Donahoe v. Donahoe

LISA K. DONAHOE, APPELLEE AND CROSS-APPELLANT, v. EDWARD K. DONAHOE, APPELLANT AND CROSS-APPELLEE.

No. A-19-105.

NEBRASKA COURT OF APPEALS

January 14, 2020

MEMORANDUM OPINION AND JUDGMENT ON APPEAL

(Memorandum Web Opinion)

NOTICE: THIS OPINION IS NOT DESIGNATED FOR PERMANENT PUBLICATION AND MAY NOT BE CITED EXCEPT AS PROVIDED BY NEB. CT. R. APP. P. § 2-102(E).

Appeal from the District Court for Douglas County: JAMES M. MASTELLER, Judge. Affirmed.

Andrew M. Ferguson, of Govier, Katskee, Suing & Maxell, P.C., L.L.O., for appellant.

Joan Watke Stacy, of Sena, Polk & Stacy, L.L.O., for appellee.

PIRTLE, RIEDMANN, and WELCH, Judges.

WELCH, Judge.

I. INTRODUCTION

Edward K. Donahoe appeals, and Lisa K. Donahoe cross-appeals, the decree entered by the Douglas County District Court dissolving their marriage. Edward assigns error to the court's determination of his annual income, the valuation of his business, his child support obligation, his spousal support obligation, the attorney fee award, his tax payment obligation, and his equalization payment. Lisa assigns error to the court's failure to award her sole legal custody of the parties' minor child and failure to award her retroactive child support. Based upon the analysis set forth herein, we affirm.

II. STATEMENT OF FACTS

Edward and Lisa were married in November 1992. Two children were born during the marriage, but only one child, Drake, was a minor at the time of trial. Lisa filed for dissolution of the parties' marriage in June 2016.

1. PRE-TRIAL ORDERS

In August 2016, the district court entered a temporary order stating:

That neither party shall be ordered to pay the other party child support at this time; however the parties should be and are hereby order[ed] to pay fifty percent (50%) of the direct expenditures incurred on behalf of the parties' minor children including, but not limited to, clothing, school lunches, and extracurricular activities. . . .

That the issue of child support should be and is hereby preserved until the final hearing so that the parties can exchange income information. That any order for child support shall be retroactive to the first day of August, 2016. . . .

That the Court orders that the parties sell their marital residence; that each of the parties should be and is hereby ordered to immediately list the marital residence for sale with a licensed realtor.

In December 2016, the first temporary order was modified by a second temporary order. The second temporary order noted that Edward had previously been ordered to provide discovery responses and had failed to do so within the required time period. The court ordered Edward to fully respond to Lisa's interrogatories and request for production of documents and ordered Edward to pay $500 toward Lisa's attorney fees. The court further ordered Edward to pay spousal support in the amount of $750 per month until further order of the court. The second temporary order further provided, in relevant part:

[Edward] should be and is hereby ordered to continue to pay the joint expenses of the parties from his business account as he has in the past, including [Lisa's] car payment and car insurance, Synchrony Bank loan, Dalton's car payment and car insurance, the children's extracurricular activities, and children's clothing until further order of the Court.

. . . .

. . . That all other terms of the Temporary Order previously entered herein on the 29^th day of August, 2016, not specifically modified herein, shall remain in full force and effect.

In a third temporary order filed in March 2017, the district court noted that Edward had failed to pay the attorney fees awarded in the second temporary order, granted Lisa's motion for sanctions, and ordered Edward to pay $1,000 toward Lisa's attorney fees. The court again ordered Edward to fully respond to Lisa's first set of interrogatories and requests for production of documents.

2. TRIAL

Trial was held in October 2018. At trial, witnesses testifying on Lisa's behalf included herself and Zachary Ahlf, an accountant who was federally licensed to practice as an "EnrolledAgent." Witnesses testifying on Edward's behalf included himself and Frank Haverkamp, an attorney and owner of a business brokerage company.

The evidence established that Edward is self-employed and the sole owner of Great Plains Sports Flooring, LLC ("Great Plains"). Great Plains does not have any employees. From 2013 to 2018, Lisa worked as a teacher. The record is unclear as to Lisa's employment history prior to 2013.

Edward testified that, in 2015, his gross income was $78,000; however, because he had to pay $15,000 in taxes that year, his income was approximately $60,000, or $5,000 per month. Edward testified that he believed his tax returns were accurate and that the parties' 2015 tax return showed that Edward made $58,000 and Lisa made $52,000.

Lisa moved out of the marital home in October 2016. Edward testified that when she moved out, Lisa took some of the furniture, such as beds, for the boys to use at her residence, requiring Edward to purchase $3,064.35 of furniture to replace the items. Edward also acknowledged that the same amount, $3,064.35, appeared on his 2016 corporate tax return as furniture on form 4562 Depreciation and Amortization. Edward also acknowledged that the court ordered him to list the marital home for sale, but stated that he did not do so because that was not agreed upon between himself and Lisa.

Lisa testified at trial that despite the court's orders requiring Edward to produce discovery, he had yet to produce all of the discovery that she requested. She further testified that the trial court had issued the second temporary order which directed Edward to pay a bill to Pacesetters, which is one of Drake's baseball teams, but as of the time of the trial, Edward had not paid the team. Edward testified that he worked out a payment plan with the team.

Lisa testified that she and Edward agreed to joint legal custody during mediation in June 2016. During the trial, Lisa relied on her calendar and explained that to that point, Edward had 242 parenting days, but during 73 of those nights, Lisa had one or both of the boys. Lisa further testified that 11 of the 73 nights were days that Edward had to travel out of town for work. Lisa also testified that she has had to take Drake an additional four times per month during Edward's parenting time.

Lisa further testified that up until the time of trial, she has provided Edward's health insurance, including vision and dental, costing her just under $300 per month. Lisa also testified that she provided medical insurance for the parties' children, including the parties' oldest child while he was still a minor.

Edward testified the communication between himself and Lisa has improved since the initial filing for dissolution. He further testified that he and Lisa worked together to find a counselor for Drake to help process his feelings about the divorce.

Lisa, however, testified that communication between herself and Edward is strained. Lisa testified Edward refuses to communicate with her regarding Drake's baseball activities. More specifically, Lisa testified that when she asks Edward for that information, he either does not reply or responds with "fuck you." Lisa further testified about the harassing behavior Edward exhibited when communicating with her. Lisa testified about Edward entering her residence on more than one occasion, even though she had exclusive possession of it. Lisa described how Edward pays spousal support by explaining he never tells her when he is coming over despite her asking him for a time, and he sometimes leaves a check in her mailbox or pushes the check through her door so it is laying on the floor, which "freaked" her out.

Lisa also testified that Edward made decisions regarding Drake's involvement in baseball without consulting her. Lisa testified that Edward would make plans for Drake that were during Lisa's parenting time and changed the teams Drake was playing for without first consulting her. Lisa testified that she only became aware of Drake's baseball tournaments and Edward removing Drake from school to attend those tournaments because Drake informed her. Lisa testified that for baseball alone, Drake missed 12 days of school in one academic year. Lisa testified that Edward has made it clear that she cannot discuss baseball decisions with him until she is willing to pay for some of the associated expenses.

Edward, on the other hand, testified he and Lisa discussed the opportunity of Drake joining the Royals baseball team and that playing with that team would provide Drake with national exposure to college coaches. Edward testified that even though playing with the Royals would conflict with the Pacesetter season, Edward talked to the Pacesetter's coach and received permission for Drake to play with the Royals. Edward then explained that Drake eventually joined a New Jersey baseball team after Edward discussed the situation with both Lisa and Drake. Edward testified that the national exposure that Drake received due to his association with the New Jersey baseball team led to a $40,000 athletic scholarship from the University of Missouri.

Lisa and Edward each had an expert testify on their behalf. The testimony by Edward's witness, Haverkamp, was limited to ascertaining the value of Great Plains. Lisa's expert witness, Ahlf, testified regarding both the value of Great Plains and the total compensation Edward drew from his wholly-owned company.

(a) Frank Haverkamp

Haverkamp explained that because Great Plains appeared to be in start-up mode during 2013 and 2014, he focused his valuation review on the 2015 and 2016 income information. Haverkamp testified the value of Great Plains was, in theory, approximately $73,000. Haverkamp testified that he computed the theoretical value of the company by ascertaining its "discretionary earnings" following the add back of the owner's compensation, multiplying these ...