This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2002).

 

STATE OF MINNESOTA

IN COURT OF APPEALS

C1-03-141

 

In re the Marriage of:

Corrine Patricia Jahnke, petitioner,

Respondent,

 

vs.

 

Kenneth James Jahnke,

Appellant.

 

Affirmed in part, reversed in part, and remanded; motions denied

Filed October 21, 2003

Minge, Judge

 

Hennepin County District Court

File No. DC260852

 

Karen L. Schreiber, Sonja Trom Eayrs, Lindquist & Vennum, P.L.L.P., 4200 IDS Center, 80 South Eight Street, Minneapolis, MN 55402 (for respondent)

 

Judith L. Oakes, J. Oakes & Associates, Hamline Place, 2589C Hamline Avenue North, Roseville, MN 55113 (for appellant)

 

            Considered and decided by Hudson, Presiding Judge, Randall, Judge, and Minge, Judge.

U N P U B L I S H E D   O P I N I O N

MINGE, Judge

            Appellant-father Kenneth Jahnke challenges provisions in a dissolution judgment imposing sanctions on him and awarding respondent-mother Corrine Jahnke need-based attorney fees, conduct-based attorney fees, and permanent maintenance.  Father further challenges the granting of mother’s pretrial motion in limine and the posttrial denial of his motion to reduce his maintenance obligation.  He also moves to strike portions of mother’s brief.  Mother seeks attorney fees for responding to father’s motion.  We affirm in part, reverse in part, and remand, and deny the parties’ motions. 

FACTS

            The parties married and had two children.  Both parties worked outside the home.  Mother was a salesperson.  In 1998, the parties agreed to share mother’s sales territory.  Later in 1998, mother gave father full responsibility for her territory, and started working for the company in a different capacity.  Eventually mother lost her job. 

After the parties separated in the summer of 2000, father withdrew $153,055.71 from the parties’ accounts without mother’s knowledge or consent.  At the end of August, mother petitioned to dissolve the marriage.  In June 2001, the district court issued an order for temporary relief.  Among other things, it awarded mother temporary maintenance of $1,200 per month.  An October 2001 interim order directed father to pay mother $13,158 as her share of the funds for which he had not accounted.  Father did not do so, and in November 2001, the district court again ordered him to pay mother for her share of the missing funds.  The district court also granted mother’s motion in limine to preclude father from entering evidence regarding the reason for her termination from employment and increased mother’s temporary maintenance award to $2,660 per month. 

In April 2002, the district court issued a judgment that, among other things, ordered father to pay mother (a) $13,967 for her share of the missing funds; (b) a $13,967 sanction for wrongfully withholding from mother her share of the missing funds; (c) $20,000 in need-based attorney fees; (d) $15,000 in conduct-based attorney fees; and (e) $2,660 in permanent monthly maintenance.  The judgment also awarded the parties joint physical custody of the children and directed mother to continue to seek “suitable employment.” 

Father then moved for amended findings.  His motion alleged that certain findings were unsupported and proposed new language for those findings.  Neither the motion nor any associated document, however, attempted to explain why the evidence in the record did not support the district court’s findings.  The district court noted that both it and mother had difficulty in responding to father’s motion because that motion was so conclusory that it failed to give adequate notice why father was seeking to amend the findings.  One exception is mother’s new employment; after the trial she began working for a net monthly wage of about $2,894, about twice what she had been receiving in unemployment benefits.

            On August 12, the district court amended certain findings and changed the basis for the sanction from father’s failure to pay mother her share of the missing funds to father’s failure to return to mother various items of property he had taken from the house.  The court, however, denied the bulk of father’s motion.  On October 18, the district court (a) found mother’s expenses had increased because of a mortgage refinancing needed to pay her attorney fees; (b) found that father’s income increased $1,000 per month; and (c) denied father’s motion to reduce his maintenance obligation.  Father appeals.  On appeal, he moves this court to strike portions of mother’s brief.  Mother opposes father’s motion and seeks attorney fees for responding to the motion.

D E C I S I O N

I.

            The judgment initially sanctioned father for his dissipation of, and subsequent refusal to pay mother for her share of, the funds he took from the parties’ accounts.  After father moved for amended findings, the district court changed the basis for the sanction to father’s refusal to honor a June 20, 2001 order regarding removal of property from the homestead.  Father challenges the sanction.

A dissolution summons must include a notice that generally forbids parties from disposing of assets and states that doing so “WILL” subject the violator to “SANCTIONS BY THE COURT.”  Minn. Stat. § 518.091(a) (2002).  Father admits that he removed property from the house without authority.  The district court noted that this conduct required “one or more emergency telephone conference calls” to the court and issuance of a court order.  The district court also found mother “more credible” than father regarding the damage to the property that was returned and the extent of the property that was not returned, and ordered father to pay mother $2,167 for the repair and replacement of the damaged and missing property.

            Father argues that the sanction was inappropriate because the district court initially refused to award attorney fees for his removal of the property.  We reject that argument.  That attorney fees initially might be deemed inappropriate for certain conduct does not mean that no sanction is appropriate.  Cf. Black’s Law Dictionary 1341 (7th ed. 1999) (defining “sanction” as “[a] penalty or coercive measure that results from failure to comply with a law, rule, or order”).  The district court did eventually base its award of conduct-based attorney fees in part on father’s removal of the property.

            Father alleges the sanction is defective because it was imposed a year after the conduct in question and six months after the trial, and because he had already remedied the problem by returning the disputed items.  But the passage of time does not mean father was not subject to sanctions, and the district court rejected father’s allegation that he returned all of the property intact.  See Sefkow v. Sefkow, 427 N.W.2d 203, 210 (Minn. 1988) (stating appellate courts defer to district court credibility determinations).

            Father also argues that a sanction exceeding $13,000 for $2,167.36 in lost or damaged property is excessive.  We agree and, for three reasons, reduce the sanction.  First, the sanction is more than six times the financial damage caused by father’s conduct.  Absent findings that a sanction so disproportionate to the damage caused is necessary to deter future improper conduct or for some other reason, the district court did not adequately justify the sanction imposed here.  Second, because the sanction was imposed in the posttrial proceedings, the deterrence-related value of the sanction was limited; by that point, father had a significantly reduced opportunity to engage in similar conduct.  Third, in addition to imposing the sanction, the district court also awarded mother $15,000 in conduct-based attorney fees, partially based on father’s conduct related to the property removed from the house.  Therefore, we conclude that limiting this sanction to $2,167.36, representing the value of the lost or damaged property, is appropriate. 

II.

Father challenges the award to mother of $20,000 in need-based attorney fees.  A district court “shall” award need-based attorney fees if it finds that (a) the fees are necessary for a good-faith assertion of rights; (b) the payor has the ability to pay the award; and (c) the recipient does not have the means to pay his or her own fees.  Minn. Stat. § 518.14, subd. 1 (2002).  Most case law states that need-based attorney-fee awards are discretionary with the district court.  Kahn v. Tronnier, 547 N.W.2d 425, 431 (Minn. App. 1996), review denied (Minn. July 10, 1996).  But see Geske v. Marcolina, 624 N.W.2d 813, 816 n.1 (Minn. App. 2001) (citing cases suggesting district court may lack discretion regarding need-based attorney fees).  Here, the district court made the statutory findings, stating (a) mother was “warranted” in asserting that much of the litigation was caused by father’s lack of integrity; (b) mother lacked “sufficient funds” to pay her attorney and expert fees; and (c) father had “substantial cash assets” from which he could contribute to mother’s attorney and expert fees. 

While father argues that the district court’s analysis of the parties’ respective abilities to pay fees is flawed because he was only awarded $94,634 in liquid assets rather than the $109,674 found by the district court, he does not explain what is included in the district court’s calculation of his liquid assets that is not included in his own calculation.  Father also argues that the evaluation of the parties’ liquid assets omits consideration of the requirement that he transfer $45,101.36 to mother for her share of the missing funds, compensation for the damaged or missing personal property taken from the house, conduct-based attorney fees, and sanctions.  But we have significantly reduced the sanction.  Also, because the transfers to mother are to compensate her for the effects of father’s improper conduct, adopting father’s argument would be to rule that he can avoid imposition of an obligation to pay need-based attorney fees by acting in bad faith.  We decline to adopt such an argument. 

Citing cases that do not involve Minn. Stat. § 518.14, subd. 1, or were decided under a version of that statute predating its 1990 amendments, father argues that “[g]enerally,” an award of fees is necessary “only when there is a marked disparity in the circumstances of the parties, and a spouse lacks job skills and experience.”  But under the amended statute, a disparity in resources does not govern whether a party can be awarded need-based fees.  See Geske, 624 N.W.2d at 817 n.2.  A similar analysis addresses father’s argument that parity of resources precludes an award of need-based fees.  In sum, we affirm the award of $20,000 of need-based attorney fees.

III.

Father challenges the award to mother of $15,000 in conduct-based attorney fees.  A court has “discretion” to award “additional” conduct-based attorney fees “against a party who unreasonably contributes to the length or expense of the proceeding.”  Minn. Stat. § 518.14, subd. 1.  An award of conduct-based fees under Minn. Stat. § 518.14, subd. 1, may be made regardless of the recipient’s need for fees and regardless of the payor’s ability to pay the obligation.  See Gales v. Gales, 553 N.W.2d 416, 423 (Minn. 1996).  Father notes that there was no finding that his conduct was unreasonable.  On this record however, any failure to make such a finding is harmless because the unreasonableness of various aspects of father’s conduct is self-evident. 

Father argues that basing the conduct-based fee award on his failure to pay mother her share of the dissipated funds penalizes him twice for that conduct because it was also the basis for a sanction.  But the amended order changed the basis for the sanction to father’s improper removal of property from the home.  Father also argues that if he was sanctioned for his removal of property from the house, the district court penalized him twice for that conduct because it was also used as a basis to award the conduct-based attorney fees.  We reject this argument for three reasons.  First, we have significantly reduced the sanction.  Second, Minn. Stat. § 518.091(a) states that improper disposition of property “WILL” subject the offending party to sanctions, and Minn. Stat. § 518.14, subd. 1 gives the court “discretion” to award conduct-based attorney fees.  Neither statute forbids its use if the other has been invoked.  Therefore, that the sanction and the conduct-based fees were partially based on the same conduct is not per se improper.  Third, after reviewing the record, we conclude that the significantly reduced sanction and the conduct-based attorney-fee award do not aggregate to excessively penalize father. 

The district court also used father’s failure to maintain existing home, auto, and umbrella insurance coverages as a basis for awarding conduct-based attorney fees.  Father observes that while the summons required him to keep those coverages in place, his failure to do so after June 2001 was consistent with the June 20, 2001 order for temporary relief that directed each party to “obtain and maintain” their own homeowner’s and automobile insurance.  The June 2001 order, however, did not eliminate father’s obligation to provide umbrella coverage. 

The district court found that father’s initial refusal to attend co-parenting class with mother “resulted in additional unnecessary attorney fees.”  Father argues that “no evidence” supports this finding.  But mother’s September 16, 2001 affidavit states that father agreed to attend the parenting classes “only because of the intervention of attorneys.”  And father’s assertion that his failures to comply with court directives are excused by the fact that “emotions [were] running high” is not persuasive. 

The district court found that father’s initial failure to sign joint tax returns for 2000 generated unnecessary fees and costs.  Father challenges this finding, noting that he signed joint returns for 2001 and that his temporary maintenance obligation was increased in November 2001.  How these events bear on the 2000 tax returns, however, is neither explained nor apparent. 

The district court also cited father’s full-day deposition of mother as a basis for awarding conduct-based attorney fees, noting that the deposition addressed the attorney-fee question.  Father argues that the deposition addressed other subjects and that counsel was not “abusive” during the deposition.  The point of the district court’s ruling is that the deposition was unnecessary, not whether counsel was courteous in conducting the deposition.  Additionally, that portions of the deposition addressed other nominally legitimate topics does not mean that other portions of it were proper. 

To support its award of conduct-based fees, the district court found that while the parties temporarily alternated living in the marital home, father “unilaterally” changed the parties’ phone-answering service, Internet access, and email accounts.  Father argues that this was reasonable because the parties were then dissolving their marriage.  But the changes were not the basis of the fee award; it was the changes combined with the father’s giving mother neither notice of the changes nor the new access codes for the computer and answering machine.  In sum, we cannot conclude the district court abused its discretion in ordering father to pay $15,000 for conduct-based attorney fees.

IV.

            Father challenges the amount and duration of mother’s $2,660 permanent monthly maintenance award.  Generally, absent an abuse of the district court’s “wide discretion” in setting maintenance, its determination “is final.”  Erlandson v. Erlandson, 318 N.W.2d 36, 38 (Minn. 1982).  While Minn. Stat. § 518.552 (2002) lists factors to be considered in setting the amount and duration of maintenance, no single factor is dispositive, and the issue is basically the recipient’s need balanced against the obligor’s financial condition.  Erlandson, 318 N.W.2d at 39-40.  Uncertainty about a maintenance recipient’s ability to become self-supporting requires an award of permanent maintenance.  Minn. Stat. § 518.552, subd. 3; Nardini v. Nardini, 414 N.W.2d 184, 198 (Minn. 1987). 

A.        Duration

            At the time of trial, mother was unemployed.  Noting that his expert estimated that mother could use her skills as a salesperson to earn $70,000 to $100,000 annually within three to five years, father argues that mother should have been awarded maintenance for three to five years.  But the district court (a) found that mother’s reasonable monthly expenses when paying for half of the children’s activity expenses would be $5,717 and that it is reasonable that the parties equally split the children’s expenses; (b) noted that father’s expert qualified his assertion regarding mother’s future income in light of mother’s desires to avoid traveling and to spend time with the children; (c) found that, in light of the expert’s qualified prediction about mother’s income, it was “speculative” that mother would actually earn that much within three to five years; (d) refused to speculate in that manner; and (e) retained jurisdiction to modify maintenance.  The district court’s refusal to speculate is consistent with case law.  See Hafner v. Hafner, 406 N.W.2d 590, 593 (Minn. App. 1987).  And the district court noted that, including maintenance, mother would have $4,325 in monthly income to meet $5,717 in monthly expenses, meaning both that mother is unable to support herself and that the district court did not abuse its discretion in awarding her permanent maintenance. 

B.        Amount

            Father alleges that mother’s maintenance award is excessive because it is based on a $219 overstatement of the monthly expenses of the parties’ children.  However, any error is harmless.  The court found mother’s monthly deficit is approximately $1,400.  If we assume father is right, it is clear that overstating mother’s monthly expenses by $219 does not eliminate her need for maintenance.  Father also argues that the expenses found by the district court overstated mother’s monthly expenses because they failed to reflect the decrease in the parties’ standards of living required by mother’s unemployment.  Father’s motion for amended findings asserted that mother’s monthly expenses were “approximately $5,000.”[1]  This amount still exceeds the $4,325 the district court found to be mother’s monthly cash flow.  Again, even if the expense figure were adjusted as father asked in his motion for amended findings, mother’s monthly need would still exceed her cash flow. 

            Based on his own calculations, father argues that mother was awarded 67% of the parties’ disposable monthly income and that this amount was excessive.  Father’s calculations suggest that the parties’ combined monthly expenses must be reduced by $2,987, or $1,493.50 each.  The district court’s figures show mother and father have monthly deficits of $1,392 and $1,403, respectively.  Thus, father is apparently arguing that his maintenance obligation is excessive by $101.50 (the difference between mother’s current $1,392.50 monthly deficit and the $1,493.50 father apparently believes that it should be).  But the maintenance imposed by the district court roughly equalizes the parties’ deficits and allows each party to choose how to reduce their expenses.  Father has not shown that the district court abused its discretion in setting the amount of mother’s maintenance award.  Cf. Ganyo v. Engen, 446 N.W.2d 683, 687 (Minn. App. 1989) (affirming $900 monthly maintenance award even though it caused the appellant’s maintenance obligation and expenses to exceed his income).

V.

Father challenges the denial of his motion to reduce maintenance.  Whether to modify maintenance is discretionary with the district court and requires the moving party to show both substantially changed circumstances and that the change makes the existing award unreasonable and unfair.  Hecker v. Hecker, 568 N.W.2d 705, 709 (Minn. 1997); see Minn. Stat. § 518.64, subd. 2 (2002) (addressing maintenance modification).  Although one reason the district court denied father’s motion was that father did not provide sufficiently specific information and argument to support the motion, we will address the question.  See Nguyen v. State Farm Mut. Auto. Ins. Co., 558 N.W.2d 487, 491 (Minn. 1997) (stating that courts are reluctant to “punish” clients for their attorney’s mistakes). 

The record shows that mother’s claimed increase in her expenses was because she refinanced her house to cover her attorney fees and that she became employed with an increase of income of about $1,500 per month.  The district court accepted the refinancing cost as an added living expense and disregarded the new income.  Since each party is initially responsible for her or his remaining attorney fees and since the district court had already equally divided the parties’ assets and addressed their abilities to support themselves in the maintenance provisions of the judgment, a further adjustment of the judgment for an attorney-fee related financing is an abuse of discretion absent further explanation.  Since mother’s new income from employment is substantial, it is similarly an abuse of discretion for the district court to reject any adjustment to the maintenance award on this ground without any explanation.  Therefore, we reverse the district court’s denial of father’s motion to reduce his maintenance obligation and remand for the district court to readdress whether to grant father’s motion.  On remand, the district court, to the extent necessary to address the refinancing and employment questions (as well as any other maintenance-related questions deemed pertinent) shall reopen the record to address those questions.  We note the father’s income has increased by $1,000 per month and we express no opinion on the merits of the remanded issues.

VI.

            A pretrial order granted mother’s motion in limine and forbade father from entering evidence regarding the termination of mother’s employment.  Father challenges this ruling.  Generally, a failure to seek a new trial precludes appellate review of evidentiary rulings.  Alpha Real Estate Co. v. Delta Dental Plan, 664 N.W.2d 303, 309 (Minn. 2003).  On appeal from a judgment, however, we may review any order affecting the judgment.  Minn. R. Civ. App. P. 103.04. 

            Income may be imputed to a maintenance recipient if the recipient is underemployed in bad faith.  Carrick v. Carrick, 560 N.W.2d 407, 410 (Minn. App. 1997).  Here, father argues that the evidence in question addressed whether the conduct for which mother was terminated was in good faith.  A successful appellate challenge to an evidentiary ruling requires the complaining party to show both that he was prejudiced by a district court’s ruling and that the ruling was either an abuse of the district court’s broad discretion related to evidentiary matters or based on a misunderstanding of the law.  Uselman v. Uselman, 464 N.W.2d 130, 138 (Minn. 1990). 

            The evidence that father seeks to have considered is evidence that mother did not perform her duties, was unfamiliar with the geographic area assigned to her for sales purposes, and was not working in her sales territory.  Such evidence could suggest that mother failed to perform her duties because she did not know how to do so.  If mother did not know how to do what her employer wanted her to do, her failure to perform those tasks could not be in bad faith.  More importantly, the transcript shows that the district court had significant and legitimate concerns about whether the evidence in question was more prejudicial than probative.  On this record, father has not shown that the district court abused its discretion in excluding the evidence. 

VII.

            Father moves to strike three references from mother’s brief.  The first two involve mother’s refinancing of her house.  Because this court is remanding the maintenance modification issue for the district court to address, among other things, the refinancing question, we need not strike the refinancing references in mother’s brief.  The third reference that father seeks to strike involves the income derived from the sales territory that used to be mother’s sales territory.  When read in context, the statement cannot mislead the court.  Therefore, we decline to strike it. 

            Mother seeks attorney fees for responding to father’s motion but fails to cite any authority for the requested fees.  Because she argues that she should be awarded the fees because father’s motion is “baseless,” we infer that she is seeking conduct-based attorney fees under Minn. Stat. § 518.14, subd. 1.  On this appeal, we decline to award additional conduct-based attorney fees. 

            Affirmed in part, reversed in part, and remanded; motions denied.



[1] Father’s motion for amended findings gives no rationale or calculation to support this amount.  For this reason, we have grave doubts about whether the motion was adequate to obtain an alteration of the finding of mother’s monthly expenses or any other finding regarding which the motion may have been similarly undeveloped.  See Lewis v. Lewis, 572 N.W.2d 313, 316-17 (Minn. App. 1997) (addressing requirements of motions for amended findings).