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HomeMy WebLinkAbout96-4914 civilRUBY I. GEHR, PLAINTIFF V. GERALD R. GEHR, DEFENDANT 96-4914 CIVIL TERM IN RE: CROSS-EXCEPTIONS TO DIVORCE MASTER'S REPORT IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA BEFORE BAYLEY, J. AND OLER, J. OPINION AND ORDER OF COURT Bayley, J., December 1, '1999:-- Plaintiff, Ruby I. Gehr, age 50, and defendant, Gerald R. Gehr, age 56, were married on July 14, 1976. They separated on October 10, 1996, after wife had instituted this divorce case on September 4, 1996. The parties had a jointly owned marital residence that they sold. Wife now lives in an apartment in Carlisle. Husband has been living in the area with various family members including his mother, brothers and sisters. This is a second marriage for both. They do not have children together. Wife dropped out of school in the ninth grade. She suffers from brittle diabetes, a carotid arterage blockage, a thyroid disorder and depression, and is unable to undertake gainful employment. She has received Social Security disability payments since 1983. The current monthly payment is $491 taking into account a deduction for Medicare coverage. Pursuant to a court order of January 29, 1998, husband, effective October 1, 1997, pays wife $555 per month Support plus forty percent of any bonuses 96-4914 CIVIL TERM he receives from his employer.' His average bonus for each of the last four yearshas been $1,639.32.2 Husband, who completed the eleventh grade, has worked in the shipping office of PPG since 1972. His net income is $2,508.79 per month. He is in generally good health. The parties litigated their economic dispute before a Divorce Master who filed a report on June 15, 1999. The Master found that the total value of marital property is $141,386.54. He recommended that those assets be distributed sixty percent to wife ($84,831.92), and forty percent to husband ($56,554.62). The Master found that following separation husband paid marital debt totaling $10,125.97. He recommended that the amount of marital assets to be distributed to wife ($84,831.92) be reduced by forty percent of that debt, or $4,050.39. The Master recommended that wife be awarded $750 per month indefinite alimony, and that husband be required to continue to pay for and retain her as beneficiary on the $100,000 group life insurance policy issued through his employer. The monthly premiums on that policy vary between $40 ' The docket reflects that subsequent to the Master's hearing wife filed a petition for an increase in spousal support. On August 3, 1999, an order was entered following a domestic relations conference setting the spousal support at $824.46 per month effective June 24, 1999. Under this order wife is required to pay the first $250 in unreimbursed medical expenses with defendant thereafter paying eighty-three percent. Husband filed an appeal from this order that is pending. 2 Wife is covered under husband's employer provided medical coverage. The support order requires husband to pay seventy-nine percent of any of wife's unreimbursed medical expenses. -2- 96-4914 CIVIL TERM and $76 and are deducted from husband's earnings? The Master recommend that husband receive the entire marital value of his pension, which is $36,920. The Master further recommended that husband upon retirement be required to select a survivor benefit option if his ex-wife is then living. That option would reduce the amount of husband's retirement benefit but would allow wife, if she survived him, to secure a benefit from his pension. The Master recommended that each party pay their own counsel fees and expenses. Husband excepts to the Master's report claiming that the Master erred in (1) requiring him to elect a survivor's benefit at retirement if wife is still living, (2) failing to ascribe a value to certain personal property retained by wife, (3) requiring him to pay $750 per month indefinite alimony and maintain $100,000 in life insurance with wife as beneficiary, (4) failing to properly ascribe marital debt, and (5) in not recommending an equal division of marital property. Wife excepts to the Master's report claiming that the Master erred in not awarding her attorney fees and costs. The issues have been briefed and were submitted to the court on October 13, 1999. DISCUSSION In Morschhauser v. Morschhauser, 357 Pa. Super. 339 (1986): [A] master's report is entitled to great consideration, but the court is not bound by it. The court is required to structure an equitable distribution of property in light of the factors set forth in 23 P.S. Section 401(b) [now 23 Pa.C.S. Section 3502(a)]. If in its discretion the court determines it must 3 There is currently a court order requiring husband to retain the insurance policy and maintain wife as beneficiary. -3- 96-4914 CIVIL TERM deviate from the recommendation of the master it may do so regardless of whether either party has raised the issue in an exception. (Footnote omitted.) (Citations omitted.) Despite the fact that wife acknowledged that she retained some marital personal property of which she was of the opinion that the value was $1,400, with husband being of the opinion that the property had substantially more value, the Master failed to ascribe any value to that property. While we find no credible evidence to ascribe to this personal property the substantial value suggested by husband we will ascribe it the value of $1,400 that was acknowledged by wife. The record thus supports a finding that the marital assets total $142,786.54: Proceeds from sale of marital home Husband's PPG pension Personalty to husband Personalty to wife The PPG savings plan as of May 26, 1999 Financial Trust checking Insurance Ohio National 1975 and 1977 Grand Prix Total $14,970.26 36,920.00 $8,242.3O $1,400.00 $77,829.6O $488.16 $1,036.22 $1,900.00 $142,786.54 In determining equitable distribution of martial property all of the factors set forth in the Divorce Code at 23 Pa.C.S. Section 3502(a) must be considered. Those factors, however, are not exhaustive or specific as to the weight that they are to be given. -4- 96-4914 CIVIL TERM Fonzi v. Fonzi, 430 Pa. Super. 95 (1993). We have reviewed and agree with the Master's Section 3502(a) analysis with regard to the equitable distribution of marital property, and his Section 3701(b) analysis with regard to alimony. We adopt both analyses as our own especially in light of the parties having lived together for twenty years, their current ages, wife's disability, the economic disparity between the parties and the value of the marital estate. Economic justice warrants the distribution of marital property at sixty percent to wife and forty percent to husband, with an award of indefinite alimony of $750 per month to wife based n the parties' current financial circumstances. With the adjustment of adding the $1,400 in personal property retained by wife we agree with the scheme of distribution of the $'142,786.54 in marital property as recommended by the Master: MARITAL ASSETS ASSIGNED TO WIFE Fifty percent of proceeds from sale of house $7,485.13 Financial Trust checking $488.16 Personalty retained by wife $1,400.00 Wife's share of PPG saving plan as of May 26, 1999 $76,298.63 Total $85,67'1.92 MARITAL ASSETS ASSIGNED TO HUSBAND Fifty percent of proceeds from sale of house Husband's PPG pension -5- $7,485.13 $36,920.00 96-4914 CIVIL TERM Personalty assigned to husband Husband's share of PPG saving plan as of May 26, 1999 Insurance Ohio National 1975 and 1977 Grand Prix automobiles Total $8,242.30 $1,53O.97 $1 ,O36.22 $1,900.00 $57,'114.62 We further agree with the Master that husband should be reimbursed for forty percent for the marital debt that he paid ($4,050.39), by reducing wife's assigned share in the PPG saving plan by that amount. Accordingly, the amount assigned to wife in the saving plan, $76,298.63, will be reduced by $4,050.39 to $72,248.24. There is some other old marital debt that neither party is paying for which the creditors have sought judgment. The Master recommended that if any of that debt is ultimately paid the obligation shall be sixty percent for husband and forty percent for wife. We agree with this recommendation. The $72,248.24 being assigned to wife from the PPG saving plan shall be transferred to her pursuant to a Qualified Domestic Relations order that shall be prepared by counsel and submitted to the court. The transfer of funds shall be as a rollover to wife in a tax deferred plan. Wife shall be responsible for payment of any penalty and tax resulting from any withdrawal of funds from the plan. Counsel will apply the stipulation entered into before the Master adjusting any gain or loss as to the value of the plan. We disagree with the Master's recommendation that husband should be required to select a survivor benefit option if wife is living when he retires, which option would -6- 96-4914 CIVIL TERM reduce his pension but allow wife to secure some benefits after his death. Husband will be paying alimony to wife which under the Divorce Code will terminate at his death.4 Husband has no obligation to pay any form of financial support to his ex-wife if she survives him. Accordingly, we will not require husband to select a survivor benefit option in his retirement plan. The Master recommended that husband be required to indefinitely maintain and pay for a group $100,000 life insurance policy issued by his employer, with his ex-wife as beneficiary. If husband's entitlement to benefits under this policy predated the parties' marriage this court could not order husband to designate wife as the beneficiary on the policy after their divorce. Chaney v. Chaney, supra.5 In Chaney, the Superior Court of Pennsylvania stated that "The courts are divided on the question of whether a party in a divorce action may be required to name his or his spouse as a beneficiary of an insurance policy." In Hoag v. Hoag, 435 Pa. Super. 428 (1994), the Superior Court of Pennsylvania in a case involving special relief where a spousal support order was entered, and before a divorce, allowed a husband to remove his wife as a beneficiary on his insurance policies. The court stated: [i]t would require a specific agreement by the parties or unusual 4 23 Pa.C.S. § 3707. This section does not authorize the award of alimony to extend past the payor's death unless the parties have voluntarily agreed otherwise. Chaney v, Chaney, 343 Pa. Super. 77 (1985). One of the advantages of settling economic litigation is that parties, for other tradeoffs, may agree to arrangements that would not otherwise form the basis of an award if the case is litigated. 5 The record is not clear on this point. -7- 96-4914 CIVIL TERM circumstances re!ating to the health or status of the husband to require him to maintain an insurance policy naming the wife as beneficiary, as support for wife terminates upon divorce or death of either party, or, as in this case, it is determined by a final support Order. Husband's health is generally good and he has held a good job for many years for which he has retirement benefits. We will not require him to pay for and maintain his ex-wife as a beneficiary on his group life insurance policy after they are divorced. The Master recommended that each party pay their own counsel fees and costs. Attorney's fees and costs may be awarded where there is an actual need to put a spouse on par in defending that spouse's rights vis a vis the other spouse. Chaney v. Chaney, supra. The Master concluded that husband does not have the ability to contribute to wife's fees and costs. Wife is receiving sixty percent of the marital property part of which, $72,248.24, is from the PPG saving plan. Husband has limited cash reserves and he will be paying substantial alimony to wife. Wife has been able to prosecute this divorce case and can pay her counsel fees and costs. Under these circumstances we agree with the Master that each party should bear their own counsel fees and costs. Concurrent with the entry of a decree in divorce, the following economic order is entered. ORDER OF COURT AND NOW, this ~ day of December, 1999, it is ordered: (1) Plaintiff, Ruby I. Gehr, is awarded the following marital property with the -8- 96-4914 CIVIL TERM values assigned: Proceeds from sale of house Financial Trust checking Personalty retained by wife $7,485.13 $488.16 $1,400.00 $72,248.24 (3) If any unpaid marital debt is paid by either party in the future, husband shall be responsible for sixty percent and wife shall be responsible for forty percent. (4) The order requiring husband to maintain wife as a beneficiary on his employer provided group life insurance policy, IS VACATED effective this date. (5) Any support order IS VACATED effective this date. (6) Wife is awarded indefinite alimony effective this date in the amount of $750 per month payable through the Domestic Relations Office. -9- Insurance Ohio National 1975 and 1977 Grand Prix automobiles $1,036.22 $1,900.00 Wife's share of PPG saving plan as of May 26, 1999, adjusted for assignment of $4,050.39 in marital debt (2) Defendant, Gerald R. Gehr, is awarded the following marital property at the values assigned: Proceeds from sale of house $7,485.13 Husband's PPG pension $36,920.00 Personalty assigned to husband $8,242.30 Husband's share of PPG saving plan as of May 26, 1999, $5,581.36 adjusted for payment of $4,050.39 in marital debt 96-4914 CIVIL TERM Carol J. Lindsay, Esquire For Plaintiff Ruby Weeks, Esquire For Defendant Domestic Relations Office :saa -10-