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Higgins v. Higgins

Florida Court of Appeals, Fourth District

August 23, 2017

ROBERT W. HIGGINS, Appellant,
v.
KATHY MUSSO HIGGINS n/k/a KATHY P. MUSSO, Appellee.

         Not final until disposition of timely filed motion for rehearing.

         Appeal and cross-appeal from the Circuit Court for the Nineteenth Judicial Circuit, Martin County; Laurie E. Buchanan, Judge; L.T. Case No. 11000031DRAXMX.

          Troy William Klein of the Law Office of Troy W. Klein, West Palm Beach, for appellant.

          Benjamin T. Hodas of the Law Office of Benjamin T. Hodas, LLC, West Palm Beach; and Tara S. Pellegrino of Broad and Cassel LLP, West Palm Beach, for appellee.

          Ciklin, J.

         This appeal and cross-appeal arise from an amended final judgment of dissolution of marriage. We agree with the former husband that the trial court erred by (1) failing to assign a value to a business which was deemed marital property, (2) including a dissipated asset in equitable distribution, and (3) failing to provide reasons for its finding that a boat was a marital asset. We also agree with the former wife that the trial court erred in designating as a marital asset all of the proceeds from the sale of a nonmarital property. We otherwise affirm.

         The only issues raised at trial and on appeal relate to equitable distribution. We review a trial court's determination of equitable distribution for an abuse of discretion. Kovalchick v. Kovalchick, 841 So.2d 669, 670 (Fla. 4th DCA 2003). "Distribution of marital assets and liabilities must be supported by factual findings in the judgment or order based on competent substantial evidence." Bardowell v. Bardowell, 975 So.2d 628, 629 (Fla. 4th DCA 2008) (citing § 61.075(3), Fla. Stat.). "A trial court's legal conclusion that an asset is marital or nonmarital is subject to de novo review." Mondello v. Torres, 47 So.3d 389, 392 (Fla. 4th DCA 2010).

         For his first issue on appeal, the former husband argues that the trial court erred in awarding a marital asset, a business, to the former wife based on a finding that the business's value is based on personal goodwill of the former wife and without assigning a value to the business (aside from the former wife's goodwill). When there is evidence that a marital business has value aside from one spouse's goodwill, the court must make a finding regarding that value for purposes of equitable distribution. See Niekamp v. Niekamp, 173 So.3d 1106, 1108-09 (Fla. 2d DCA 2015) (reversing and remanding to trial court to value marital property, excluding any goodwill attributable to one party, where there was evidence that the business had other assets).

         Although there was evidence that the business had tangible assets, the trial court inexplicably found that no such evidence was offered. The former wife acknowledges that the business is a marital asset, and she appropriately concedes that the asset has a value aside from her goodwill.[1] Accordingly, we reverse and remand to the trial court to value the business for purposes of equitable distribution.

         The former husband next contends that the trial court erred in including the parties' 2010 tax refund in its equitable distribution scheme when the refund was dissipated before trial and the trial court did not make a finding of misconduct. We agree. See Tradler v. Tradler, 100 So.3d 735, 740 (Fla. 2d DCA 2012) (recognizing that it is generally error to include assets in equitable distribution which have been dissipated during the dissolution proceedings in the absence of a finding of misconduct). Therefore, we reverse and remand for the trial court to omit the tax refund from its equitable distribution analysis.

         The former husband's final point on appeal relates to a boat that he purchased during the marriage to replace one he owned prior to the marriage. He argues that the trial court erred in treating the new boat as a marital asset. During trial, the former husband testified that he purchased the replacement boat using insurance proceeds he received after the premaritally-purchased boat was irreparably damaged. The former wife did not dispute that insurance proceeds related to the premarital boat were used to purchase the second boat. Instead, she testified that the former husband gifted her the new boat as a Christmas gift.

         Nonmarital assets include "[a]ssets acquired . . . by either party prior to the marriage, and assets acquired . . . in exchange for such assets." § 61.075(6)(b)1., Fla. Stat. (2011); see also Steiner v. Steiner, 746 So.2d 1149, 1151 (Fla. 2d DCA 1999) (recognizing that properties purchased during the marriage with proceeds from the sale of nonmarital property acquired before the marriage are nonmarital assets "to the extent that their purchase prices were paid with proceeds that are traceable" to the party's sale of that premarital property).

         In deeming the new boat to be a marital asset, the trial court stated that the former husband "claims he used" insurance proceeds "to purchase the [new] boat, " and it further found that the boat was titled in the former husband's name but currently in the former wife's possession. It is unclear from these findings why the trial court designated the boat as a marital asset. The former wife argues that the trial court made a credibility determination and believed her, but the court did not make any findings relating to the former wife's testimony that the former husband gifted her the new boat. This lack of findings makes review impossible. For that reason, we must reverse and remand for the trial court to either make factual findings that support designation of the new boat as a marital asset or amend the equitable distribution scheme. See § 61.075(3)(d), Fla. Stat. (requiring trial court, with respect to equitable distribution, to make "[a]ny other findings necessary to advise the parties or the reviewing court of the trial court's rationale for the distribution of marital assets and allocation of liabilities").

         The former wife raises two issues in her cross-appeal. We affirm on one issue and decline to further address it, but we reverse with respect to her claim that the trial court erred in treating as a marital asset ...


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