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HomeMy WebLinkAbout1996-2728 Civil JOAN M. BEATTIE, Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION-LAW WILLIAM H. BEATTIE, Defendant NO. 96-2728 CIVIL TERM IN RE: EXCEPTIONS TO DIVORCE MASTER'S INTERIM REPORT BEFORE OLER and GUIDO, JJ. ORDER OF COURT AND NOW, this 2nd day of April, 2007, upon consideration of the exceptions filed by Defendant to the Divorce Master's interim report, and for the reasons stated in the accompanying opinion, the exceptions are denied and it is hereby ordered and directed as follows: 1. Counsel shall attempt to agree on a realtor or realtors to list the property at III Clemson Drive, Carlisle, Cumberland County, Pennsylvania and the Bloserville apartment complex for sale. If counsel are unable to agree on a realtor or realtors, then they shall each provide the Master the names of two realtors and the Master will select from that list a person or persons to handle the sale of the real estate and will, with the advice of counsel and the recommendation of the realtor, set a listing price for the sale of each parcel of real estate; 2. Defendant shall be able to continue to reside in the marital residence at III Clemson Drive until the sale and settlement of the real estate. Defendant shall be responsible for making the payments for the mortgage and the maintenance and Plaintiff shall not lose any claims which she had for credits on account of Defendant's occupancy of the real estate; 3. If the parties have not accepted an offer to sell or to purchase either of the parcels of the real estate within 90 days based on the listing value, then the listing price will be reduced after the 90 days by 5%. If there is to be further discussion on reduction, then that will have to come before the Master with counsel to discuss how a further reduction in the price of the properties will be dealt with; 4. Defendant shall have an opportunity to participate, by offering to purchase the real estate, at any sale of the real estate; 5. Upon sale of the real estate, the funds shall be placed in an escrow account at which time counsel will request that the Master schedule a conference with counsel to discuss further proceedings in the Master's office in this case and to help outline the testimony and witnesses which will be necessary to deal with the remaining issues that are going to be identified at that conference; and 6. Upon the sale and settlement of the martial residence, each of the parties will receive an advance on equitable distribution of $5,000.00. The payment to Defendant specifically will be to allow him money to relocate to another residence. BY THE COURT, 1. Wesley Oler, Jr., 1. E. Robert Elicker, II, Esq. Divorce Master Wayne F. Shade, Esq. 53 West Pomfret Street Carlisle, P A 17013 Attorney for Plaintiff Karl E. Rominger, Esq. 155 South Hanover Street Carlisle, P A 17013 Attorney for Defendant 2 JOAN M. BEATTIE, Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION-LAW WILLIAM H. BEATTIE, Defendant NO. 96-2728 CIVIL TERM IN RE: EXCEPTIONS TO DIVORCE MASTER'S INTERIM REPORT BEFORE OLER and GUIDO, JJ. OPINION and ORDER OF COURT OLER, 1., April 2, 2007. In this bifurcated divorce case, Defendant William H. Beattie has filed exceptions to the Divorce Master's interim report recommending the sale of jointly owned real estate. The exceptions of Defendant read as follows: 4. Defendant was not permitted to call witnesses or present testimony prior to the interim order. 5. Previously, a hearing had been held on alleged spoliation of asset value, at the request of Plaintiff. 6. Plaintiffs witnesses were heard from, but none of [D]efendant's witnesses were allowed to be called. 7. Further, Plaintiff actively discouraged a subpoenaed witness from coming to the earlier hearing. 8. Defendant was ready[,] willing and able to call witnesses at the time of the last master's hearing, which was canceled, and this interim report entered. 9. [Defendant] has lived in and enjoyed use of the martial home for the last 10 years, has a business there, and is not financially able to move. 10. It is highly likely that given the offsets available, including an apartment building, a thrift savings plan in excess of $50,000.00 and [Plaintiff]' s postal pension, that [Defendant's] share of equitable distribution would allow him to keep the house as a distributed assets to him. 11. Removing [Defendant] from the house is prejudicial to him. 12. The master erred in not first having a hearing on the factors for equitable distribution. 13. If after hearing, it is determined that [Defendant] is to take anywhere from 25% to 60% of the martial estate, distributing the house to him would be both possible and fair. 14. It was an abuse of discretion to order the sale of the house without first determining whether it was directly distributable to one of the parties, particularly the party who had solely paid the mortgage for the last ten years, resides there, and has a business there. 15. Market value can be determined by appraisal, no sale is necessary. 16. [Defendant] specifically objects then to the portion of the master's report directing for the listing and sale of the martial home. 1 F or the reasons stated in this opinion, Defendant's exceptions will be denied. STATEMENT OF FACTS Plaintiff Joan M. Beattie resides at 75 Partridge Circle, Carlisle, Cumberland County, Pennsylvania. 2 Defendant William H. Beattie resides at III Clemson Drive, Carlisle, Cumberland County, Pennsylvania. 3 Plaintiff and Defendant were married on December 6, 1969, and physically separated on April 5, 1996, when Plaintiff left the marital home on Clemson Drive.4 In May of 1996, Plaintiff commenced this divorce action against Defendant. 5 Plaintiff and Defendant were divorced by bifurcated decree on September 7, 2005.6 Several years before the parties separated, Plaintiff was involved in a car accident and received approximately $107,525 in an ensuing personal injury claim.7 A portion of these proceeds, approximately $38,000, was used to purchase an apartment building in 1 Defendant's Exceptions to Divorce Master's Report, filed January 4,2007. 2 NT. 40, Hearing, August 22,2002 (hereinafter NT. _, August 22,2002). 3 NT. 88, August 22,2002. 4 NT. 40-41, August 22,2002. 5 Plaintiffs Complaint in Divorce, filed May 16, 1996. 6 Defendant initially appealed the divorce decree and then withdrew his appeal. Notice of Appeal, filed September 26,2005; Praecipe, No. 1620-MDA-2005 (Pa. Super. Ct., January 9, 2006). 7 NT. 44, 50, August 22, 2002; NT. 36-37, Hearing, June 2, 2005 (hereinafter NT. _, June 2, 2005). 2 joint ownership of the parties. 8 The building, which included four apartments, was managed by both parties when they were together, but since separation Defendant has controlled the management of the property and the rental income derived therefrom. 9 In July of 1996, Plaintiff filed a motion for a preliminary injunction in which she requested authority to control the cash flows from the apartments. This motion was denied, and Defendant has remained in exclusive control of the management of the property and the rental income. 10 In April of 1999, Plaintiff served on Defendant discovery requests for information pertaining to Defendant's investment of the personal injury proceeds and management of the apartments since 1996, when Defendant obtained exclusive control.ll Defendant's subsequent response failed to indicate the amount of monthly rent for each apartment unit; the dates and amounts of rental increases for each unit, the dates and durations of, and the reasons for, vacancies in the apartment building, the dates, payors, and amounts of each rental payment or other receipts for each unit, and the dates, payees, amounts, and purposes of all disbursements with respect to the rental properties.12 In August of 2001, Plaintiff filed her first Petition To Compel Discovery. 13 The Court issued a rule to show cause,14 held a discovery conference, and ordered Defendant to provide Plaintiff with the requested information within thirty days.15 Receiving no response Plaintiff filed her first 8 NT. 36-37, June 2, 2005. Plaintiff and Defendant purchased the apartment building in November of 1994 for $115,000. Id. at 37. 9 NT. 22-26, June 3, 2002; NT. 44-45, 50, 56-58, 60, August 22, 2002; Order of Court, July 10, 1996 (Hoffer, J.). 10 NT. 22-26, June 3, 2002; see also NT. 44, 50, 58, August 22,2002. 11 NT. 28-31, June 3, 2002; see Plaintiffs Petition To Compel Disclosure, ~31, filed August 31, 2001. 12 NT. 28-31, June 3, 2002; see Plaintiffs Ex. 13, Hearing, June 3, 2002 (hereinafter Plaintiffs Ex. _, June 3, 2002); see Plaintiffs Ex. 13, June 3, 2002. 13 Plaintiffs Petition To Compel Discovery, filed August 31, 2001. 14 Order of Court, September 4,2001. 15 Order of Court, November 11,2001. 3 Petition for Discovery Sanctions. 16 Hearings on the issues of discovery and sanctions occurred on June 3, 2002, August 22, 2002, and September 25, 2002. Regarding Plaintiff s petitions for discovery sanctions and special relief this Court ordered the following: 1. Defendant is ordered to pay Plaintiff, at the time of final disposition of this case, reasonable attorney's fees in the amount of $11,595 in accordance with this Court's January 7,2003 Order awarding attorney's fees; 2. For purposes of equitable distribution of the parties' property, Defendant will be charged with the constructive receipt of $1,820 per month, reflecting the rental income of the apartments as they were when the parties separated, for the period of July 10, 1996 through and including December 31, 1997; 3. For purposes of equitable distribution of the parties' property, unless Defendant proves otherwise at the Divorce Master's Hearing, Defendant will be charged with the constructive receipt of $13,905.73 the amount of money in the PC Financial account as reflected in the last pre-separation financial statement produced by Defendant; 4. Defendant is ordered to pay to Plaintiff, at the time of final disposition of this case, reasonable attorney's fees in the amount of $6,930 for time and expenses associated with counsel's preparation and filing of Plaintiffs fourth petition for sanctions; 5. Defendant is ordered to produce to Plaintiff, within 60 days of the date of this order, the settlement statements for the marital dwelling, the cleaning business records, and the records of insurance proceeds as sought by Plaintiff s request for documents; 6. Plaintiffs Second Petition for Special Relief is denied; and 7. Plaintiff s motions for deemed abandonment and rule absolute are denied. 17 In August of 2004 a master was appointed to review various economic issues, including the distribution of property.18 The Master held a hearing on June 2, 2005, regarding the economic issues, specifically issues relating to the parties' jointly-owned real estate. At the hearing Plaintiff called two witnesses, Defendant and Plaintiff; 16 Plaintiffs Petition for Discovery Sanctions, filed December 10, 2001. Additional petitions included: Plaintiffs Second Petition for Discover Sanctions, filed December 26,2001; Plaintiffs Third Petition for Discovery Sanctions, filed March 14, 2002; Plaintiffs Fourth Petition for Discovery Sanctions, filed March 17,2003. 17 Order of Court, June 1,2004. 18 Order of Court, August 13, 2004. 4 however, time concluded before Defendant was able to present witnesses. 19 The hearing was scheduled to reconvene on December 5,2006. The June 2005 hearing mainly discussed the condition and alleged waste by Defendant of the real estate. In regard to the rental property, Defendant commented that "I could not do any maintenance on $50.00 a month. I did the best I could. I have eviction notices here. I have court settlements. I have over 250 documented hours of my work trying to keep that building going. ,,20 It was noted that, in 1997, a fire occurred in one of the apartments21 and in 2001 one of the apartments was vandalized.22 Defendant also commented that maintenance of the apartment buildings declined over time; he stated that "roughly around the year 2000 or 1998 . . . they started to go down, which is when I started to payout of my pocket, and it went progressively downhill from there.,,23 At the June 2005 hearing Defendant admitted that the Master had given him two weeks, following a pre-hearing conference in February of 2005, to submit evidence that he could acquire the funds to refinance the real estate in his name alone and satisfy Plaintiff s equitable distribution claim.24 Defendant also admitted that he was unable to fulfill this assignment. 25 At the December 5,2006 hearing the Master began by commenting: Today's hearing was to have been a continuation of the hearing on June 2, 2005. Throughout the course of the proceedings before the Master, the Master has raised a question to counsel, as to how husband can maintain and have distributed to him two parcels of real estate because of the Master's concern that he has no assets or financing to provide wife with the 19 See NT. 5, 154, June 2,2005. 20 NT. 50, June 2,2005. 21 NT. 55-57, June 2, 2005. 22 NT. 98, June 2,2005. 23 NT. 101, June 2,2005. 24 NT. 144, June 2,2005. 25 Id. 5 funds necessary to accomplish an equitable distribution. The two assets the Master is referring to involve an apartment building in Bloserville, Pennsylvania, and martial home at III Clemson Drive, Carlisle, Pennsylvania. Counsel have indicated that there are two other assets of some substantial value, namely, a thrift savings plan that wife has from her employment and wife's disability which she receives as a result of her prior postal service employment. 26 In the Master's interim report, the Master noted that: [Defendant] was asked to provide testimony or information to the Master some time ago about his ability to buyout [Plaintiff]' s interest in the real estate. As the Master recalls, there was a deposition of a bank officer which did not apparently satisfy the Master's inquiry that [Defendant] had sufficient ability to obtain financing. Also, the Master did not receive any substantial or unequivocal guarantee from any members of [Defendant]' s family or from any other sources of [Defendant]' s relationships that he was going to be able to borrow sufficient funds to supplement whatever he might achieve through a refinancing arrangement. Consequently, this real estate has set in its present condition continuously since the acquisition of this property without any disposition of how we should proceed and the status of this real estate continues to be a point of major contention and concern because of its financial drain on the martial estate. The Master has reached the conclusion that the real estate needs to be sold and that the market should establish the value of the real estate. If we were to proceed with another hearing on the real estate, we would, of course, have to have additional testimony and updated appraisals as to the value of which would pout the parties to more expense since so much time has passed since we accomplished the previous appraisals. ... Therefore, the Master believes that the best way to proceed to get this case toward a final resolution is to let the market establish the value, sell the real estate, and put the real estate proceeds into an escrow fund pending a final resolution of the remaining issues involving equitable distribution, alimony, and counsel fees?? The Master then provided a process for conversion of the real estate into cash pursuant to his recommendation: 26 Interim Master's Report, 2-3, filed December 6, 2006. 27 Interim Master's Report, 4-5, filed December 6, 2006. 6 The process for accomplishing this result. . . will be to put into place a procedure for getting the properties listed for sale. The Master is proposing that if counsel cannot agree on a realtor or realtors . . . then the Master suggests that each counsel provide the Master with two names of realtors and then the Master will select from that list of four a realtor to list the properties. ... [Defendant] will be permitted to continue to reside in the martial residence until such time as the property is sold and settled?8 Objecting to the Master's proposal, Defendant's counsel stated on the record: I would have called [Defendant] today, if we continued the hearing, because I had not called any witnesses before the Master decided to enter an interim report-I think that [Plaintiffs counsel] had actually rested when we adjourned. I would have called [Defendant] for the purpose of discussing the condition of the apartments and he would have generally testified that when he took them over there was approximately $50.00 in net income above and beyond all the three mortgages he paid at that time, and as time went on he got some judgments against him; bad tenants, it fell into a state of disrepair and he was unable to ever sort of prime and pump and re-capitalize on the building and as the wear and tear took the building down, it became harder and harder to find better tenants and he could rent for less and less. He would then also testify that he had repeatedly asked wife for some assistance with those expenses. . .. We would have then called the parties' two daughters, Tara Reed, . . . the oldest daughter, who would have testified that she was privy to numerous requests by [Defendant] to get [Plaintiff] involved to help out with the apartment building, to put some money down on things, to cooperate minimally. She would have testified that [Plaintiff] has refused to have any meaningful communication about any assets whatsoever with [Defendant] in any way, shape, or form. The other daughter, Danielle, would have testified the . .1 1 29 slml ar y. According to the Master's report, witnesses on the substantive issue of equitable distribution could be presented at a subsequent hearing. Responding to Defendant's concern, the Master stated: Nobody is foreclosed here from presenting testimony later when we reconvene for further testimony if necessary. Nobody's rights are affected 28 Interim Master's Report, 6-7, filed December 6,2006. 29 Interim Master's Report, 10-12, filed December 6,2006. 7 by coming back and you both have the right to call and present any witnesses that you wish.30 Defendant's counsel noted that he would have called Ted Rudberg, Plaintiffs alleged paramour, to testify at the hearing. I had subpoenaed [Ted Rudberg] for the original hearing and he failed to attend. We would probably call [Plaintiffs counsel] as a witness. We believe that [Plaintiffs counsel] talked with the witness and told him that he didn't need to attend. We believe the failure-and we have that third-hand information so may be [Plaintiffs counsel] can address that, but he was served with a witness fee check and a subpoena. We attempted to reserve him for this hearing. When the process server got to the door, [Plaintiff] found out what the paperwork was and locked the process server out and would not give access to Mr. Rudberg.31 In response, Plaintiff s counsel stated: As far as Mr. Rudberg is concerned, he did not attend the last hearing because when he was served with the subpoena he was not served with an appearance fee or a mileage fee check at the time and my advice was, under those circumstances, that the statutory law-that service-that subpoena was null; it was noneffective. 32 Defendant proceeded to file exceptions to the Master's interim report III accordance with his objections raised at the December 2006 hearing.33 The exceptions were argued before an en banc court on January 24,2007. Plaintiff had also, on November 27, 2006, filed a petItIOn for special relief requesting the sale of the martial residence at Clemson Drive.34 At a hearing held before the undersigned judge on that motion on March 7, 2007, Defendant was afforded another opportunity to present evidence of his financial ability to purchase the jointly-owned 30 Interim Master's Report, 18, filed December 6,2006. 31 Interim Master's Report, 12-13, filed December 6, 2006. Defendant's counsel raised the same objection at the June 2, 2005 hearing. "We believe that Mr. Shade and/or his client counseled that witness not to attend and otherwise discouraged them from coming to testify, and we are going to ask that an adverse inference be taken from that." NT. 3-4, June 2,2005. 32 Interim Master's Report, 16, filed December 6,2006. 33 Defendant's Exceptions to Divorce Master's Report, filed January 4,2007. 34 Wife's Fourth Petition for Special Relief, filed November 27, 2006. 8 properties. Again, the only witnesses presented were Plaintiff and Defendant, and Defendant failed to provide any credible evidence that he was financially capable of purchasing or refinancing the jointly-owned properties. DISCUSSION When reviewing a divorce master's report, the trial court is to give the report "great consideration," particularly regarding the credibility of witnesses. Rothrock v. Rothrock, 2000 PA Super. 412, ~I6, 765 A.2d 400,404. However, the report is advisory only, and, when exceptions are filed, the court must conduct its own review of the evidence to determine whether the master's recommendations, to which exceptions are taken, are proper. Id The trial court IS required to reVIew the master's report, determine if the recommendations of the report are appropriate and enter a final order. Reed v. Reed, 354 Pa. Super. 284, 289, 511 A.2d 874, 877 (1986); Neil v. Neil, 731 A.2d 156, 157 (Pa. Super. Ct. 1999). The court has the discretion to deviate from the recommendations of the Master regardless of whether either party has raised a particular issue in an exception. Morschhauser v. Morschhauser, 357 Pa. Super. 339, 349, 516 A.2d 10, 15 (1986). With respect to the exceptions of Defendant to the Divorce Master's interim report, the Court is of the view that they are not meritorious. First, the contention that the Master committed reversible-type error by failing to allow Defendant to present evidence is not persuasive. According to the record, Defendant testified at the June 2005 hearing and was afforded opportunities before and after the hearing to provide evidence to the Master regarding the disposition of the real estate at issue. The Master's interim report indicated that Defendant failed to provide the Master with adequate support for the proposition that he was financially able to purchase the real estate. Defendant was afforded another opportunity at the hearing before the Court on March 7, 2007, to present evidence, and again failed to provide credible evidence that he was financially capable of purchasing the real estate. The record also suggests that Defendant had allowed the rental property to deteriorate, and there is no agreement by the parties as to the appropriate value of the jointly-owned real estate. Furthermore, the Master's 9 recommendation for the sale of the jointly-owned real estate is not a substantive determination, as the recommendation would merely covert the jointly-owned real estate into cash for eventual equitable distribution. Finally, Defendant can participate in any sale of the real estate and purchase the real estate himself on the same basis as any other purchaser. Second, Defendant's contention that "Plaintiff actively discouraged a subpoenaed witness from coming to the earlier hearing" has not been briefed by Defendant. The Cumberland County Local Rules provide that "[i]ssues raised, but not briefed, shall be deemed abandoned." C.C.R.P. 1028(c)(6). Accordingly, Defendant's exception in this regard is deemed abandoned. Therefore, the following order will be entered: ORDER OF COURT AND NOW, this 2nd day of April, 2007, upon consideration of the exceptions filed by Defendant to the Divorce Master's interim report, and for the reasons stated in the accompanying opinion, the exceptions are denied and it is hereby ordered and directed as follows: 1. Counsel shall attempt to agree on a realtor or realtors to list the property at III Clemson Drive, Carlisle, Cumberland County, Pennsylvania and the Bloserville apartment complex for sale. If counsel are unable to agree on a realtor or realtors, then they shall each provide the Master the names of two realtors and the Master will select from that list a person or persons to handle the sale of the real estate and will, with the advice of counsel and the recommendation of the realtor, set a listing price for the sale of each parcel of real estate; 2. Defendant shall be able to continue to reside in the marital residence at III Clemson Drive until the sale and settlement of the real estate. Defendant shall be responsible for making the payments for the mortgage and the maintenance and Plaintiff shall not lose any claims 10 which she had for credits on account of Defendant's occupancy of the real estate; 3. If the parties have not accepted an offer to sell or to purchase either of the parcels of the real estate within 90 days based on the listing value, then the listing price will be reduced after the 90 days by 5%. If there is to be further discussion on reduction, then that will have to come before the Master with counsel to discuss how a further reduction in the price of the properties will be dealt with; 4. Defendant shall have an opportunity to participate, by offering to purchase the real estate, at any sale of the real estate; 5. Upon sale of the real estate, the funds shall be placed in an escrow account at which time counsel will request that the Master schedule a conference with counsel to discuss further proceedings in the Master's office in this case and to help outline the testimony and witnesses which will be necessary to deal with the remaining issues that are going to be identified at that conference; and 6. Upon the sale and settlement of the martial residence, each of the parties will receive an advance on equitable distribution of $5,000.00. The payment to Defendant specifically will be to allow him money to relocate to another residence. BY THE COURT, sf 1. Wesley Oler, Jr. 1. Wesley Oler, Jr., 1. E. Robert Elicker, II, Esq. Divorce Master 11 Wayne F. Shade, Esq. 53 West Pomfret Street Carlisle, P A 17013 Attorney for Plaintiff Karl E. Rominger, Esq. 155 South Hanover Street Carlisle, P A 17013 Attorney for Defendant 12