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HomeMy WebLinkAbout99-6036 CIVILFREDERICK A. WIESEMAN, III, Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW CAROL ANN WIESEMAN, Defendant NO. 99-6036 CIVIL TERM DR 29,431 IN RE: PLAINTIFF'S PETITION FOR ALIMONY PENDENTE LITE MODIFICATION BEFORE OLER, J. OPINION and ORDER OF COURT OLER, J., November 30, 2001. This divorce case presents the issue, inter alia, of the treatment to be accorded a substantial inheritance received by an obligor, for purposes of calculating alimony pendente lite, where the inheritance was received during the parties' marriage in 1993, where the obligor's practice has been to live off the inheritance, and where the value of the inheritance has dwindled appreciably. This issue is presented as an appeal from a recommended order of court which denied a petition to modify alimony pendente lite filed by Plaintiff husband. Interestingly, in the support case of Humphreys v. DeRoss, 563 Pa. 216, 759 A.2d 371 (2000), the Pennsylvania Supreme Court has granted a petition for allowance of appeal and directed the parties to address the following issues: 1. Is an inheritance included in the definition of "income" as set forth in Section 4302 of the Divorce Code, 23 Pa.C.S.A. 4302? 2. If an inheritance meets the statutory definition of "income," should the entire inheritance be considered as income when calculating a support order or only the interest generated or imputed to be generated by the entire inheritance? 3. If an inheritance is not included when calculating a support order under the Support Guidelines, should it be considered a factor in deviating from the support amount determined by the Guidelines? 4. If an inheritance is considered when calculating support, should it be allocated over the period of the child's minority or limited to the year following receipt of the inheritance? 5. Should the amount of an inheritance affect the way in which it is considered for calculating a support order? 6. Should a payor who receives an inheritance be required to place in escrow an amount sufficient to secure the support obligation?~ In the present case, for the reasons stated in this opinion, the order will be modified to a limited extent based on changed circumstances. STATEMENT OF FACTS Plaintiff is Frederick A. Wieseman, iii, 59;2 he resides at 1005 Robert Street, Mechanicsburg, Cumberland County, Pennsylvania, and is not employed.3 Defendant is Carol A. Wieseman, 58;4 she resides at 100 Deerfield Road, Camp Hill, Cumberland County, Pennsylvania, and is employed as a clerk and bookkeeper for a district justice in the county of York, Pennsylvania. 5 The parties were married on July 15, 1967.6 Their children are now adults.7 They separated on September 30, 1999.8 Plaintiff husband filed the instant action for divorce on October 4, 1999, and Defendant wife raised a claim for alimony ~ Humphreys, 563 Pa. 216, 759 A.2d 371. 2 N.T. 5, Hearing, September 28, 2001 (hereinafter N.T. ~. Unfortunately, at the hearing the designation of Plaintiff and Defendant became confused, probably because Defendant wife was the claimant with respect to alimony pendente lite. As a consequence, exhibits of Defendant wife were referred to as PlaintifFs exhibits and exhibits of Plaintiff husband were referred to as Defendant's exhibits. No attempt in this opinion has been made to redesignate the exhibits. 3 N.T. 28-29. 4N.T. 5. s N.T. 8-9. 6N.T. 5. ~N.T. 5. 8N.T. 5. 2 pendente lite on February 22, 2000. On April 13, 2000, following a Domestic Relations Office conference, a recommended order of court was entered providing for payment of alimony pendente lite by Plaintiff husband to Defendant wife in the monthly amount of $960.00, based upon a net monthly income/earning capacity of Plaintiff of $4,022.54 and a net monthly income/earning capacity of Defendant of $1,619.00.9 Plaintiff husband filed an appeal from this order pursuant to Pennsylvania Rule of Civil Procedure 1910.1 l(i), on April 25, 2000.l° The basis for the appeal was that Plaintiff husband was "[n]ot agreeable to [the] monthly net income/earning capacity assigned to parties.''~ This appeal, however, was apparently withdrawn.~2 Defendant wife filed a Petition for Modification of an Existing Support Order on August 16, 2000.~3 The basis for the petition was that [Plaintiff husband] was provided with a Rozman credit for direct household expenses he paid at the time of the APL hearing. He has since stopped paying the mortgage, real estate taxes, telephone and cable bills and contributes nothing to the household. The APL Order should therefore be increased. In addition, home repair costs have been incurred which total $578.00. [Plaintiff husband] refuses to contribute any portion thereto.TM On September 22, 2000, following a Domestic Relations Office conference, a recommended order of court was entered providing for payment of alimony pendente lite by Plaintiff husband to Defendant wife in the monthly amount of $1,210.00, based upon a net monthly income/earning capacity of Plaintiff husband Order of Court, April 13, 2000; see Pa. R.C.P. 1910.11. l0 Plaintiff's Demand for Hearing, filed April 25, 2000. Plaintiff's Demand for Hearing, filed April 25, 2000. ~2 Summary of Trier of Fact, September 21, 2000, at 3. ~3 Plaintiff's Petition for Modification of an Existing Support Order, filed August 16, 2000. 14 Plaintiff's Petition for Modification of an Existing Support Order, filed August 16, 2000, at 2. 3 of $4,643.00 and a net monthly income/earning capacity of Defendant wife of $1,619.00.~5 On May 25, 2001, Plaintiff husband filed the Petition for Alimony Pendente Lite Modification which the parties have treated as the subject of this proceeding.~6 On June 27, 2001, following a Domestic Relations Office conference, a recommended order of court was entered denying the petition.~7 The order was based on the perception of the conference officer that there had been no change in Plaintiff husband's net income/earning capacity,la Plaintiff husband challenges this order on appeal.~9 A hearing was held by the court on Plaintiff husband's petition for modification on September 28, 2001. The evidence established, to the court's satisfaction, the following facts: Plaintiff husband, for present purposes, has no earned income or earning capacity.2° He last worked in 1992.2~ During the parties' marriage, in May of 1993, Plaintiff husband received an inheritance in the amount of $477,000.00.~ He placed this inheritance into a cash management account (which included stocks and bonds~3) in his own name, and never commingled the funds with joint assets.~4 ~5 Order of Court, September 22, 2000; see Pa. R.C.P. 1910.11. 16 N.T. 4; see Plaintiff's Petition for Alimony Pendente Lite Modification, filed May 25, 2001. ~7 Order of Court, June 27, 2001; see Pa. R.C.P. 1910.11. ~8 Order of Court, June 27, 2001. 19 Although Plaintiff's Demand for a Hearing indicates that Plaintiff husband appeals from the order of support entered on Setpember 22, 2000, the parties have treated this matter as an appeal from the June 27, 2001, order that denied Plaintiff's Petition for Alimony Pendente Lite Modification. N.T. 4. Accordingly, the court will also treat this as an appeal from the denial of of Plaintiff husband's petition. 20 N.T. 7. 2~ N.T. 12. 22 N.T. 31. 23 N.T. 32-33. 24 N.T. 31. 4 Since receipt of the inheritance, it has been Plaintiff husband's practice to live off the inheritance, and the parties' bills were paid with funds arising out of the inheritance.25 In 1999, Plaintiff husband's monthly withdrawals from the inheritance account averaged $4,247.53; in 2000, his monthly withdrawals averaged $5,073.25; and in 2001, his monthly withdrawals have averaged $5,562.50.26 The value of the investment account was $512,000.00 in 1999,27 fell to $415,239.00 in 2000,28 and has fallen to $299,980.50 in 200129 with the decline of the stock market.3° In addition to the monthly withdrawals from the investment account, Plaintiff husband receives retirement income from the Commonwealth of Pennsylvania in the net monthly amount of $164.003~ and disability income from the Veterans Administration in the net monthly amount of $101.00.32 Defendant wife's net monthly income from her employment is $1,219.00.33 In addition, she receives $300.00 per month in rent from the parties' oldest child, who resides with her.34 Her reasonable monthly expenses exceed her income.35 Finally, the sum of $695.00 per month which is received in rent from investment real estate owned jointly by the parties is deposited in an account in 25 N.T. 12, 41-42. 26 Plaintiff's Exhibit 3, Hearing, September 28, Exhibit ~. 27 N.T. 34-35. 28 N.T. 34-35. 29 N.T. 35. 30 N.T. 32. 3~ N.T. 30. 32 N.T. 29; Defendant's Exhibit 11. 33 N.T. 6. 34 N.T. 9. 35 Plaintiff's Exhibit 1. 2001 (hereinafter Plaintiff's or Defendant's 5 Defendant wife's name.36 This money is treated by Defendant wife as joint funds 37 and not subject to her personal use. Jointly held assets of the parties consist primarily of the marital residence, where Plaintiff wife presently resides, which has an equity value of about $163,000.00,38 and the aforementioned rental property, which has a market value of about $85,000.00 and is not subject to a mortgage.39 The money which is treated by Defendant wife as joint funds amounts to about $2,200.00.4° The aforesaid items appear to be the extent of the parties' incomes and assets. DISCUSSION In Humphreys v. DeRoss, 737 A.2d 775 (Pa. Super. Ct. 1999), appeal granted, 563 Pa. 216, 759 A.2d 371 (2000), the Pennsylvania Superior Court affirmed a lower court's treatment of an inheritance as income in the context of determining a child support obligation. Id. at 776. In DeRoss, the lower court had amortized the lump sum amount over a period concluding with the child's anticipated date of majority for purposes of arriving at a periodic income figure. Id. This approach obviously involves some invasion of principal as opposed to utilization of funds generated by, or an increase in value of, the corpus of the inheritance only. The pendency of an appeal in Humphreys notwithstanding, the duty of this court is of course to apply the holding of the Superior Court on the issue presented. See Cook v. Cook, No. 2000-0022 Civil Term, slip op. at 8 n.9 (Ct. Com. Pl. Cumberland County Feb. 2, 2001) (Guido, J.). 36 N.T. 17-19. 37 N.T. 18-19. 38 N.T. 17. 39 Plaintiff's Exhibit 1; N.T. 18-19. 40 Plaintiff's Exhibit 1. 6 In the present case, a substantial change has occurred in the circumstances of the parties, in that the value of Plaintiff husband's inheritance has decreased dramatically due to market conditions. In the context of alimony pendente lite, an amortization period does not suggest itself (as it does in the context of child support) whereby an inheritance can be reduced to periodic amounts for purposes of calculating an obligor's income. However, the practice of Plaintiff husband of making withdrawals from the inheritance corpus over the years for living expenses, and the amounts of the withdrawals in evidence, when considered in conjunction with the decrease in value of the account, militates in favor of an attribution of net monthly income based upon the inheritance in the amount of $2.550.00.41 When Plaintiff husband's retirement income is added to this figure, his net monthly income for purposes of a calculation of alimony pendente lite is $2,815.00. As previously mentioned, Defendant wife's net monthly income for purposes of the calculation is $1.519.00. The following order will be entered accordingly: ORDER OF COURT AND NOW, this 30th day of November, 2001, upon consideration of Plaintiff husband's Petition for Alimony Pendente Lite Modification, and following a hearing, and the court finding that Plaintiff husband's net monthly income is $2,815.00 and that Defendant wife' s net monthly income is $1,519.00, Plaintiff husband's appeal is sustained to the extent that the recommended order dated June 27, 2001, as modified in accordance with the support guidelines and without deviation therefrom, is entered. 4~ In 1999, the last year when the parties lived together, the value of the inheritance was $512,000, and Plaintiff husband's withdrawals averaged $4,247.53 per month. Presently, the value of the fund is about 60% of the 1999 amount. The figure of $2,550.00 represents about 60% of the 1999 average monthly withdrawal. 7 BY THE COURT, Charles Rector, Esq. 1104 Femwood Avenue Camp Hill, PA 17011 Attorney for Plaintiff Kathleen C. Daley, Esq. 1029 Scenery Drive Harrisburg, PA 17109 Attorney for Defendant J. Wesley Oler, Jr., J. 9 FREDERICK A. WIESEMAN, III, Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA Vo CIVIL ACTION - LAW CAROL ANN WIESEMAN, Defendant NO. 99-6036 CIVIL TERM DR 29,431 IN RE: PLAINTIFF'S PETITION FOR ALIMONY PENDENTE LITE MODIFICATION BEFORE OLER, J. ORDER OF COURT AND NOW, this day of November, 2001, upon consideration of Plaintiff husband's Petition for Alimony Pendente Lite Modification, and following a hearing, and the court finding that Plaintiff husband's net monthly income is $2,815.00 and that Defendant wife' s net monthly income is $1,519.00, Plaintiff husband's appeal is sustained to the extent that the recommended order dated June 27, 2001, as modified in accordance with the support guidelines and without deviation therefrom, is entered. BY THE COURT, Charles Rector, Esq. 1104 Fernwood Avenue Camp Hill, PA 17011 Attorney for Plaintiff Kathleen C. Daley, Esq. 1029 Scenery Drive Harrisburg, PA 17109 Attorney for Defendant J. Wesley Oler, Jr., J.