Llaurado v. Garcia-Zapata

223 A.3d 247

Marta Maria LLAURADO

v.Javier GARCIA-ZAPATA, Appellant

No. 180 EDA 2019

Superior Court of Pennsylvania.

Argued October 17, 2019

Filed November 13, 2019

Reargument Denied January 17, 2020

Francis A. Urso, Media, for appellant.

Craig B. Huffman, Media, for appellee.

BEFORE: BENDER, P.J.E., DUBOW, J., and COLINS, J.^*

OPINION BY COLINS, J.:

Appellant Javier Garcia-Zapata ("Husband") appeals from the decree entered December 19, 2018 divorcing Husband and Appellee Marta Maria Llaurado ("Wife") from the bonds of matrimony. Husband now challenges an earlier order entered on June 26, 2018, dividing the marital estate and awarding alimony to Wife, which was finalized by the divorce decree. For the reasons set forth below, we affirm.

Husband and Wife were married on October 10, 1989, are currently in their early 50s, and are the parents of three minor children born in 2002, 2004, and 2012. On May 17, 2013, Wife filed a divorce complaint. Wife later withdrew the complaint but then reinstated it on December 23, 2013. Husband filed an affidavit of consent, and on July 9, 2014, Husband filed an answer and counterclaim. Following the trial court's entry of an order establishing the date of separation as March 15, 2013, Husband filed an affidavit on March 26, 2015, stating that the marriage was irretrievably broken pursuant to Section 3301(d) of the Divorce Code, 23 Pa.C.S. § 3301(d). Wife filed a counter-affidavit of non-opposition to divorce on April 14, 2015.

Following a hearing, an equitable distribution master issued a report and recommendation on April 11, 2017. Both parties objected to the report and recommendation and requested a hearing de novo . The trial court conducted a de novo hearing on April 4, 2018. At the hearing, counsel agreed that the equitable distribution proceeding would be conducted on a "case-stated basis" on documentary exhibits and facts stated by counsel without requiring the testimony of their clients.¹ N.T., 4/4/18, at 4-5. The trial court issued its equitable distribution order with findings of facts and conclusions of law on June 26, 2018.

In the order, the trial court determined that the total value of the marital estate was $168,337 and that the estate should be divided with Wife receiving 60% and Husband receiving 40%. Order, 6/26/18, at 11, 22. Among the assets in the marital estate were four retirement investment accounts that Husband had liquidated in 2014 and 2015; the trial court valued the accounts at $132,137 based on their gross value at the time of liquidation, concluding that Husband should be solely responsible for the taxes and penalties resulting from the early liquidation of the accounts. Id. at 3-4, 11-12. In addition, the trial court valued a Boston Whaler 200 Dauntless boat owned by the couple at $22,000. Id. at 15, 22. The trial court also awarded Wife alimony in the amount of $1,897 per month for four years from the date of the order and counsel fees in the amount of $5,000 payable in five monthly installments. Id. at 20-21, 23.

Husband filed a notice of appeal of the equitable distribution order. However, on August 20, 2018, this Court sua sponte quashed the appeal as being from a non-final order because, while the trial court had resolved the parties' economic claims, no divorce decree had been entered. The trial court then issued the divorce decree on December 19, 2018. Husband filed a timely notice of appeal of that order on January 10, 2019.²

Husband presents the following issues for our review:

1. The learned trial court erred by utilizing the gross amount of the retirement and/or investment accounts for purposes of equitable distribution without considering certain tax ramifications thereby compelling [Husband] to remain solely responsible for all assessed taxes[.]

2. The learned trial court erred by utilizing the gross amount of the retirement and/or investment accounts for purposes of equitable distribution when [Husband] while under the specter of unmerited and unwarranted domestic relations orders and eventual imprisonment for purported contempt of said Orders was forced to liquidate certain retirement and/or investment accounts to meet support obligations[.]

3. The learned trial court erred by utilizing the gross amount of the retirement and/or investment accounts for purposes of equitable distribution when [Husband] liquidated same as [Husband] had no income and no other funds with which to pay certain support obligations as evidenced by [Husband's] unemployment from August 7, 2013 through January 11, 2016 and his imprisonment in the G.W. Hill Correctional Facility from contempt of said support obligations from May 4, 201[5] until November 5, 2015. SeeGriffin v. Griffin , 558 A.2d 86 (Pa. Super. 1989).

4. The learned trial court erred by failing to consider the federal, state and local tax ramifications associated with the accounts [Husband] was forced to liquidate to meet his support obligations. See 23 Pa.C.S.A. § 3502(10.1).

[5]. The learned trial court erred by determining the valuation assigned to a 2008 Boston Whaler boat totaled $22,000.00 and failing to credit [Husband] for the $4,500.00 [Wife] received when the boat was sold in 2014.

[6]. The learned trial court erred by determining [Wife] was entitled to an award of alimony in the amount of $1897 per month for four (4) years despite finding that as of the date of the hearing and equitable distribution award, [Husband] was unemployed.

[7]. The learned trial court erred by determining that alimony was appropriate in light of the alimony factors outlined in 23 Pa.C.S.A. § 3701 and in particular, [Husband's] employment status as of the date of the hearing and equitable distribution award.

8. The learned trial court erred by awarding [Wife] $5,000.00 in counsel fees when the invoice for said fees failed to segregate attorney time and expenses among representation for custody, child support, or equitable distribution.

9. The learned trial court erred by failing to address the parties' student loan obligations and failing to determine the parties were solely responsible for any and all student loan debt incurred by either party prior to or during the marriage and the party securing said debt would indemnify the other for any collection efforts and/or seizures, past, present and future associated with the failure to timely pay his or her student loans.

Husband's Brief at 4-5 (reordered for ease of disposition).

Our review of a challenge of an equitable distribution award is governed by the following standards:

A trial court has broad discretion when fashioning an award of equitable distribution. Our standard of review when assessing the propriety of an order effectuating the equitable distribution of marital property is whether the trial court abused its discretion by a misapplication of the law or failure to follow proper legal procedure. We do not lightly find an abuse of discretion, which requires a showing of clear and convincing evidence. This Court will not find an abuse of discretion unless the law has been overridden or misapplied or the judgment exercised was manifestly unreasonable, or the result of partiality, prejudice, bias, or ill will, as shown by the evidence in the certified record. In determining the propriety of an equitable distribution award, courts must consider the distribution scheme as a whole. We measure the circumstances of the case against the objective of effectuating economic justice between the parties and achieving a just determination of their property rights.

Moreover, it is within the province of the trial court to weigh the evidence and decide credibility and this Court will not reverse those determinations so long as they are supported by the evidence.

Brubaker v. Brubaker , 201 A.3d 180, 184 (Pa. Super. 2018) (citation omitted).

In his first four appellate issues, Husband challenges the trial court's valuation of the retirement investment accounts at the gross amount of $132,137 without making an adjustment for over $30,000 in taxes that Husband was required to pay when liquidating the accounts. Husband first argues that the valuation of the accounts at the gross amount violates Section 3502(a)(10.1) of the Divorce Code, which requires that a court weighing the division of marital assets consider "[t]he Federal, State and local tax ramifications associated with each asset to be divided, distributed or assigned, which ramifications need not be immediate and certain." 23 Pa.C.S. § 3502(a)(10.1). Consideration of the tax ramifications of marital assets is mandatory. Carney v. Carney , 167 A.3d 127, 133 (Pa. Super. 2017). However, as this Court has explained, "the statute requires us only to consider the tax ramifications ... along with numerous other listed factors, but the Divorce Code does not make a deduction for them mandatory." Id. at 133-34 (emphasis in original) (quoting Balicki v. Balicki , 4 A.3d 654, 664 (Pa. Super. 2010) ).

The trial court plainly considered the tax ramifications of the retirement accounts in the equitable distribution order. The trial court found that the accounts were liquidated without the consent of Wife and without the permission of the trial court. Order, 6/26/18, at 3, 12. In addition, the court noted that, as a result of the Husband's unilateral liquidation of the accounts, Wife had lost the value of the potential market growth of the assets. Id. at 4, 12. The trial court thus concluded that Husband alone should bear responsibility for the taxes deducted as a result of the early liquidation of the accounts. Id. at 4, 12. The trial court properly considered the tax ramifications in assessing the value of the retirement accounts, and we decline Husband's invitation to overturn its well-supported findings and conclusions.

Husband further argues that the trial court's refusal to assign some shared responsibility for the taxes he paid is inequitable and fails to account for the fact that Husband's liquidation of the accounts was not voluntary and...