Karmand v. Karmand

DEBORAH S. EYLER, Judge. Din M. Karmand, the appellant, challenges the judgment of the Circuit Court for Montgomery County (Sundt, J.) in his divorce action against Soraya Karmand, D.D.S., the appellee. The appellant presents the following questions for review, which we have combined and rephrased as follows: I. Did the trial court abuse its discretion in denying his request for indefinite alimony?

II

Did the trial court err in permitting the appellee to testify about the value of her dental practice?

III

Did the trial court err by not ascertaining what portion of the value of the marital home was derived from the appellant’s non-marital property?

IV

Did the trial court err by classifying as extant marital property a Jeep the appellant gave to his daughter in January 2000, and $3,823 in cash he put in a joint account with his daughter in August 1999? V. Did the trial court err in valuing certain jewelry based on the appellee’s testimony about what she paid for it? For the following reasons, we shall affirm the judgment of the circuit court. FACTS AND PROCEEDINGS The following evidence was adduced at trial, which took place in February 2001.

The appellant was born in Afghanistan. In 1968, he emigrated to the United States; and he became an American citizen thereafter. The appellant attended graduate school at the University of Maryland, earning a masters degree in ³²³ mechanical engineering in 1972. At the time of trial, he was 56 years old and had been employed for slightly more than 18 years as a property engineer for the Floyd Davis Company.

The appellee was bom in Iran, and completed two years of college in that country. In 1977, she emigrated to the United States. She also eventually became an American citizen. At the time of trial, the appellee was 49 years old and was working full time in her own private dental practice.

The parties married on April 12, 1980. They moved into a house in Silver Spring that the appellant owned, and had purchased prior to the marriage. The house subsequently was retitled to tenants by the entireties ownership. The parties’ first child, a girl named Arezo, was born on August 2,1981.

When the parties married, the appellant was working full-time for Blake Construction Company and part-time for the Crown Corporation. Soon after the marriage, the appellee enrolled in Montgomery College. While attending school, she worked part-time during the school year, and full-time during the summer, as a chairside dental assistant, at the Georgetown Dental School. The appellee earned her associates degree and then continued with her schooling at Montgomery College.

She attended school part-time and worked part-time in a private dental office. In 1985, the parties had a second child, a boy named Omied. The appellee was the primary care-giver for the parties’ children. She continued with her education, however, and in 1986 earned a bachelors degree from Montgomery College.

After Omied was born, the parties sold their house in Silver Spring and purchased a house in Potomac. Soon after she earned her bachelors degree, the appellee was admitted to Howard University Dental School. She attended that dental school full time, from 1986 to 1990. During those four years, the appellee did not work outside the home.

The appellant supported the family by working two full-time ³²⁴ jobs. For five days a week, he worked eight hours during the day for the Floyd Davis Company and eight hours during the night for the Crown Corporation. He employed a nanny to help with the children. The appellee remained the primary care-giver for the children and took care of the house.

The appellee took out student loans to finance her dental school education. In July 1990, soon after she graduated from dental school, the appellant paid $8,000 toward the balance on the appellee’s student loans. Immediately upon graduation, the appellee opened a private dental practice in a rented office on Colesville Road, in Silver Spring. Because the space had never been used for a dental office, it needed extensive remodeling.

The appellant oversaw the construction, supervising the electricians, plumbers, carpenters, and painters. The appellee worked with the architect and obtained the necessary permits for the construction. The initial cost of construction was about $129,000. The parties paid this sum with $64,000 from their joint savings accounts and $65,000 obtained by refinancing their house in Potomac.

In the early years of her dental practice, the appellee worked seven days a week, twelve hours a day. She also was responsible for the children and for taking care of the house. With time, her practice became established and profitable. She was able to use her earnings from the practice to pay off her student loans.

In October 1994, the parties decided to purchase the Colesville Road property that housed the appellee’s dental practice. The purchase price was $188,000. The parties purchased the property free and clear by again refinancing their Potomac house. Also in 1994, the appellee returned to dental school and obtained a specialized degree in orthodontics.

Her tuition was paid with marital funds. During the marriage, the appellant was responsible for the family’s financial investments. He purchased, in joint names, two rental properties in Virginia, and handled all the business ³²⁵ aspects of the properties, such as collecting rent and property maintenance. As the appellee’s practice became more lucrative, the appellant invested the earnings it produced.

The investments included establishing custodial accounts for the children, which by the time of trial had balances totaling $210,000. In 1994, the appellant was diagnosed with diabetes. He underwent angioplasties in 1997 and 1999, and in 2000 was diagnosed with high blood pressure. As of the time of trial, he was taking several medications.

In 1999, the parties’ relationship became strained. There was some evidence that the appellant had become involved in a relationship with another woman, although he denied that. There also was evidence that the appellee had become estranged from the appellant and had told a mutual friend that she did not love him anymore. The deterioration in the parties’ relationship continued and culminated in their voluntarily separating on September 6,1999.

On September 10, 1999, the appellant filed a complaint for limited divorce, in the Circuit Court for Montgomery County. He later filed an amended complaint for absolute divorce. The appellee answered and filed a counter-complaint for absolute divorce. On March 22, 2000, the parties entered into a consent order on the issues of custody, visitation, and child support with respect to Omied.

(By then, Arezo was emancipated by age). The agreement gave the parties joint legal custody, with the appellee having primary residential custody and the appellant having visitation. The appellant agreed to maintain health insurance for Omied and to pay $451 per month in child support. The case went to trial on the issues of grounds for divorce, use and possession of the marital home, alimony, monetary award, and attorney’s fees.

The trial lasted three days. On March 29, 2001, the court entered a judgment of absolute divorce, on the ground of mutual and voluntary separation. ³²⁶ On April 11, 2001, the court issued a memorandum opinion and order awarding the appellee use and possession of the family home until July 13, 2003 (Omied’s eighteenth birthday), denying the appellant’s request for indefinite alimony, directing that the parties’ marital property be sold and divided by title, and reserving on the issue of attorney’s fees. The appellant noted this appeal on May 10, 2001. 1 We shall recite additional facts as pertinent to our discussion of the issues. DISCUSSION I The appellant first challenges the trial court’s decision denying his request for indefinite alimony.

As the Court of Appeals explained in Tracey v. Tracey, 328 Md. 380 , 614 A.2d 590 (1992), we review that decision under an abuse of discretion standard: An alimony award will not be disturbed on appellate review unless the trial judge’s discretion was arbitrarily used or the judgment below was clearly wrong. This standard implies that appellate courts will accord great deference to the findings and judgments of trial judges, sitting in then-equitable capacity, when conducting divorce proceedings. Id. at 385 , 614 A.2d 590 (citations omitted). The appellant maintains that Judge Sundt’s decision to deny his request for indefinite alimony was based on two clearly erroneous factual findings, and therefore was an abuse of discretion.

The findings he takes issue with are: 1) that he is self-supporting, and 2) that the standards of living of the parties are not “unconscionably disparate.” Historically, alimony was judicially defined as court ordered payments made by a husband to a wife for her support for their joint lives, so long as they lived separate and apart and ³²⁷ the wife did not remarry. Mendelson v. Mendelson, 75 Md. App. 486, 495 , 541 A.2d 1331 (1988). Thus, by tradition, the primary purpose of alimony was to enable a financially dependent wife to continue her standard of living after separation or divorce. Quinn v. Quinn, 11 Md.App. 638, 651 , 276 A.2d 425 (1971). “It was a basic concept of alimony that a financially dependent [wife] (at least one who was not at fault for the destruction of the marriage) should be able to maintain the same standard of living to which [she] had become accustomed during the marriage, provided, of course, that [the husband] could afford it.” Holston v. Holston, 58 Md.App. 308, 321 , 473 A.2d 459 (1984).

When Maryland adopted the Equal Rights Amendment in 1972, Article 46, Md. Decl. Rights, courts became empowered to award alimony to husbands as well as to wives. Quigley v. Quigley, 54 Md.App. 45, 52 , 456 A.2d 1305 (1983). The essential purpose of alimony was changed with the adoption of the Maryland Alimony Act in 1980 (“Act”).

Where the principal function of alimony once had been maintenance of the recipient, dependent spouse’s standard of living, upon passage of the Act, that function became rehabilitation of the economically dependent spouse. Since passage of the Act, “ ‘the purpose of alimony [has been] to provide an economic means for both parties to deal with their new unmarried life on their own. Put another way, the purpose of alimony is to provide an opportunity for the recipient party to become self-supporting.’ ” Turrisi v. Sanzaro, 308 Md. 515, 524 , 520 A.2d 1080 (1987) (quoting 1980 Report of the Governor’s Commission on Domestic Relations Laws (hereinafter “Governor’s Commission’s Report”), at 2). Under the Act, alimony no longer serves the purpose of providing a lifetime pension to an economically dependent spouse.

Turrisi v. Sanzaro, supra, 308 Md. at 524-25 , 520 A.2d 1080 ; Jensen v. Jensen, 103 Md.App. 678, 692 , 654 A.2d 914 (1995); Holston v. Holston, supra, 58 Md.App. at 321 , 473 A.2d 459 . See also Governor’s Commission’s Report, at 4. Rather, its primary purpose is to aid an economically depen ³²⁸ dent spouse in becoming independent through self-sufficiency, when practicable. As noted in the Governor’s Commission’s Report: “The award of alimony in the ordinary case should be for a specific time, and that time should be stated in the Order or Decree making the award.

Preferably, that time should be fixed in relation to a specified program or goal on the part of the recipient party that will lead to self-sufficiency before that time.” Governor’s Commission’s Report, at 4. It is now well recognized that the sole purpose of temporary alimony is rehabilitation of the recipient spouse and, for that reason, an award of temporary alimony must be grounded in a finding that the recipient spouse is not self-supporting and needs training,' education, or other steps to help that spouse achieve .financial self-reliance. Reuter v. Reuter, 102 Md.App. 212, 229 , 649 A.2d 24 (1994). See also Lemley v. Lemley, 102 Md.App. 266, 300 , 649 A.2d 1119 (1994)(holding that an award of temporary or rehabilitative alimony may not be made unless the recipient spouse is not self-supporting and citing Hull v. Hull, 83 Md.App. 218, 220-221 , 574 A.2d 20 (1990)).

In keeping with the recommendations of the Governor’s Commission’s Report, the law favors temporary alimony awarded for a definite time’ period to facilitate the transition from the married to single state and rehabilitation of the dependent spouse ’ to self-sufficiency. Turrisi v. Sanzaro, supra, 308 Md. at 524-25 , 520 A.2d 1080 . The Governor’s Commission’s Report recognized two exceptions to the guiding principle that alimony be temporary and rehabilitative, and recommended that trial judges be given wide discretion to resolve those exceptional instances on a case-by-case basis.- - The exceptions are addressed in Md.Code (1999 RepLVol., 2000 Supp.), section ll-106(c) of the Family Law Article (“FL”). Under the first exception, the court may award indefinite alimony if, “due to age, illness, infirmity, or disability, the party seeking- alimony cannot reasonably be expected to make substantial progress toward becoming self-supporting.” FL § ll-106(c)(l).

Under the second excep ³²⁹ tion, the court may award indefinite alimony upon a finding that even after the'party seeking alimony will have made as much progress toward becoming self-supporting as can reasonably be expected, the respective standards of living of the parties will be unconscionably disparate. FL § 11—106(c)(2). With regard to the issue of the respective standards of living of former spouses after divorce, the Governor’s Commission’s Report observed: The measure of self-sufficiency for a divorced party has been less widely discussed than the question of the period of time during which alimony should be paid. Nevertheless, underlying the views expressed to the Commission by individuals and organizations, there is discernible a range of disagreement, -bounded on the one hand with the view that any standard is acceptable that holds body and soul together, and on the other by the position that the recipient spouse must live on the same scale as the paying one, indeed on the same scale as that on which the parties lived while married.

The Commission believes that different ills call for different remedies. Certainly Cinderella, after only a week of marriage, even to the Prince, might be young and strong enough to adapt herself to a return to her stepmother’s kitchen. Cinderella, after thirty years of royal marriage, would find such a return a less practicable course. The Commission believes that the proper solution is neither to forbid nor to require either equality or discrepancy with respect to the standard of living of the parties after a divorce.

Our proposal does not require the Court to make the two standards the same. It does empower the Court, however, in cases where the standard of living of the recipient party would be unconscionably disparate from that of the paying party, to provide for an extended or indefinite period of payment. This allows the matter of ³³⁰ relative standards of living to be resolved, as it seems to us it must be, on a case-by-case basis. Governor’s Commission’s Report, at 4-5.

(Emphasis in original.) In Roginsky v. Blake-Roginsky, 129 Md.App. 132, 142 , 740 A.2d 125 (1999), cert. denied, 358 Md. 164 , 747 A.2d 645 (2000), we explained that because the objective of alimony is to assist spouses in becoming self-supporting and not to provide a lifetime pension, indefinite alimony should be awarded “only in exceptional circumstances.” See also Turrisi v. Sanzaro, 308 Md. at 527 , 520 A.2d 1080 (observing that the concepts underlying the Act, including “the use of indefinite alimony only in exceptional circumstances,” did not mandate elimination of the power to reserve). In addition, “[a] trial court’s finding of unconscionable disparity under [FL section 11-106(c)(2)] is a question of fact, and [the appellate court will] review it under the clearly erroneous standard contained in Md. Rule 8-131 (c).” Roginsky v. Blake-Roginsky, 129 Md. App. at 143 , 740 A.2d 125 . FL section ll-106(b) addresses considerations that must be made by the court in determining the amount and duration of any alimony award. It provides that “the court shall consider all the factors necessary for a fair and equitable award,” including the specific factors listed thereafter.

When a party seeks indefinite alimony under FL section ll-106(c)(2), the court must consider the factors enumerated in subsection (b), to the extent pertinent, in deciding whether there is a disparity in the parties’ respective standards of living and, if so, whether the, disparity is “unconscionable.” As the prefatory language in subsection (b) makes plain, however, the court is not restricted to a consideration of the factors expressly listed. .In the case at bar, Judge Sundt’s memorandum opinion addressed each of the factors in FL section ll-106(b). She made the following factual findings, which are fully supported by the record. As of the time of trial, the appellant was employed full time, earning a gross income of $67,000 a year. He did not need ³³¹ further education or training to continue in his employment.

During the three years preceding the trial, the appellee’s dental practice had earned between approximately $250,000 and $350,000 annually. In some years, those earnings had included earnings produced by another dentist with whom the appellee was working. On the appellee’s financial statement, which was introduced into evidence, she listed her monthly income as $15,470 (which converts to an annual income of $185,640); her monthly expenses as $6,063 per month; and Omied’s monthly expenses as $3,858 per month. None of the expenses is unreasonable; the highest expenses are for the monthly mortgage and legal fees.

Because the parties jointly own the Silver Spring office building in which the appellees’ dental practice is located, when all of the parties’ jointly owned real estate is sold, the appellee will have to move her office to a new location. The court found that the appellee may suffer a decline in income when that occurs, and may incur additional expenses in order to relocate. The court concluded that for these reasons, “it is unlikely that [the appellee’s] gross receipts will reflect the success of prior years, at least temporarily.” At the time of trial, the appellant was living in a condominium owned by the parties’ daughter, but paid for by him. In the last several years before the parties separated, the appellee was the primary source of financial support for the family.

The parties enjoyed an affluent standard of living during their marriage. They owned four pieces of real property, five cars, and valuable jewelry. They traveled extensively, including trips to Turkey, London, and Spain. The appellant’s investment acumen resulted in the parties’ earning income above and beyond their salaries through employment.

Both parties made monetary and non-monetary contributions to the well-being of the family. The appellant supported the family financially, by working two full-time jobs when the appellee was attending dental school and hiring a nanny for the family. He assisted with the building renovations for the ³³² appellee’s dental practice, and helped the appellee establish and expand her practice. Before becoming the primary source of financial support for the family in the latter years of the marriage, and while she was attending school and working part time, the appellee was the primary custodial parent for the children, especially when they were very young.

The parties’ marriage deteriorated over a long period of time, with episodes of ugly conflict in the summer of 1999 that led to the parties’ separation. Much of the conflict concerned the appellant’s controlling attitude toward the appellee, including his insistence on deciding how the earnings from her dental practice would be invested, to the exclusion of recommendations made by the parties’ accountant. Judge Sundt commented that since the parties’ separation, the appellant had fostered a controlling relationship with Arezo that seemed to encourage her alienating herself from her mother. Judge Sundt concluded, however, that the breakup of the marriage was a consequence of the parties’ having gradually grown apart.

As of the time of trial, the parties’ real estate, all jointly owned, had a value of $917,420. The court ordered that that property be sold. (The court granted the appellee use and possession of the marital home, so that asset will not be sold until after July 13, 2003.) Upon the sale of all the parties’ real property, each party will receive approximately $458,000. The total value of the parties’ marital personal property was $303,792.

Of that amount, $157,427 was titled in the appellee’s name, and $146,365 was titled in the appellant’s name. As noted above, the appellant disagrees with the following factual findings made by Judge Sundt. Judge Sundt found that the appellant is self-supporting. Specifically, she rejected his contention that he is in poor health and that his health affects his ability to work.

Judge Sundt commented that the appellant was working full-time and apparently intends to continue to do so. ³³³ Second, Judge Sundt found that the parties’ standards of living are not “unconscionably disparate.” In so finding, she explained: In plain English, unconscionability means, “morally unacceptable ... shocking.” Fader, J. & Richard Gilbert, Maryland Family Law, § 5.66 (3d. ed.2000). Case law reflects that the party seeking alimony because of “unconscionable disparity” has the burdens of persuasion and production. Essentially, “unconscionable economic disparity is more than a numerical calculation.” Innerbichler v. Innerbichler, 132 Md.App. 207 [, 248, 752 A.2d 291 ] (2000). Furthermore, “[a] finding of mathematical disparity will not automatically trigger an award of indefinite alimony.” Ware v. Ware, 131 Md.App. 207, 232 , 748 A.2d 1031 (2000).

The Court must apply equitable considerations on a case-by-case basis aided by several factors. The standard of living of the parties must be considered as well as how and when that standard was acquired. Additionally, the assets of the parties and whether a monetary award was given impact the decision awarding alimony. (Citing Fader, J. and Gilbert, R., Maryland Family Law, § 5.10, 5-66 (3d. ed.2000).) After completing her discussion of the factors listed in FL section 11—106(b), Judge Sundt went on to find that given that the appellant earns $67,000 per year, has assets titled in his name and in his control of $142,842, and will be receiving approximately $458,000 upon the sale of the parties’ real property, and that while the appellee’s dental practice is successful, it likely will experience a temporary decline in revenue after the divorce, “[t]here is no need or basis for awarding alimony,” and any disparity in the parties’ standards of living is not unconscionable.

The appellant’s challenge to Judge Sundt’s finding that he is self-supporting is two-fold. He takes issue with the court’s conclusion that he is not in poor health, arguing that the evidence was uncontradicted that he had undergone two angioplasties, was suffering from hypertension and diabetes, and ³³⁴ was taking numerous medications. This challenge has no merit. Plainly, Judge Sundt accepted the uncontradicted evidence about the state of the appellant’s health but found, contrary to his assertion, that the state of his health was not interfering with his ability to work.

The court’s finding on this point was supported by the evidence, which showed that the appellant indeed was physically capable of working full-time in his field of mechanical engineering. The appellant also argues that his financial statement, which was introduced into evidence, and was not contradicted by any other evidence, showed that he was not self-supporting because his monthly income of $4,300 is less than his monthly expenses of $6,600. In fact, the figures the appellant recites are not as they are reflected on his financial statement. The financial statement shows that his gross monthly salary is $5,285.41, with another $333.33 in bonuses; his approximate net monthly salary after taxes is $4,101.97.

His approximate monthly expenses, including such incidentals as $150 for vacations, $150 for donations to charities, $90 for gifts, and $70 for entertaining at home, and not including voluntary contributions to a retirement fund, total $4,961. Those expenses include $451 in child support (which will terminate in slightly more than a year), and $1,500 rental for the condominium in which the appellant lives; he testified, however, that the condominium rental in fact is $500 a month, but he has been paying his daughter $1,000 per month above that amount. The evidence about the appellant’s monthly income and expenses supports Judge Sundt’s finding that he is self-supporting. We hasten to add, moreover, that a person does not establish that he is not self-supporting merely by presenting monthly expenses, even reasonable monthly expenses, that exceed his monthly income.

If that were the test, a multimillionaire could be found not to be self-supporting. The appellant asserts that Judge Sundt’s finding that the parties’ standards of living are not “unconscionably disparate” ignores uncontradicted evidence about a great disparity in the ³³⁵ parties’ incomes and in the affluence vel non of their lifestyles. He points out that since the separation, the appellee has purchased a luxury automobile, has continued to take expensive vacations to foreign countries, and enjoys earnings of at least three times his earnings. By contrast, he drives an old automobile purchased during the marriage, has not taken any vacations, lives with his daughter, and earns about a third of what the appellee earns.

The appellant argues that Judge Sundt’s focus on the value of the assets he will own after the