This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2004).
IN COURT OF APPEALS
In re the Marriage of:
Renee L. Jenson, petitioner,
Leslie M. Jenson,
Filed June 27, 2006
Ramsey County District Court
File No. F5-99-2139
John P. Van Valkenburg, Gerten & Van Valkenburg, P.A., 303 East Little Canada Road, Saint Paul, MN 55117 (for respondent/appellant Renee L. Jenson)
John C. Gunderson, Meier, Kennedy
& Quinn, Chartered, 2200
Considered and decided by Stoneburner, Presiding Judge; Willis, Judge; and Crippen, Judge.*
U N P U B L I S H E D O P I N I O N
In these consolidated appeals following the vacation of an amended dissolution judgment because of fraud, wife argues that (1) the district court clearly erred by finding that wife committed fraud and (2) the district court abused its discretion by awarding husband conduct-based attorney fees. Because the record supports the district court’s finding of fraud and the district court did not abuse its discretion by awarding attorney fees, we affirm the vacation of the judgment and the attorney-fees award. Husband argues in his appeal that the preceding judgment, which was revived as a result of the order of vacation, must be amended because its conclusion of law regarding the marital-property division contains numerous errors. We agree, and reverse and remand.
Husband and wife’s 30-year marriage was dissolved in February 2001. In the dissolution judgment, husband was ordered to pay wife $2,000 per month in permanent spousal maintenance. At the time of dissolution, wife was the president and sole stockholder of a corporation formed to operate a consulting business; she received no income from the business, and the corporation had incurred losses since its formation. The district court found that
[wife] is mentally ill. Her most recent diagnosis is Bipolar Disorder Type II and Borderline Personality Disorder.
. . . .
It is clear that [wife’s] mental illness is not sufficiently stabilized at this time to allow her to be employed. Her treating psychiatrist and psychologist do not know if or when this will occur. Once her illness is stabilized, [wife] can begin vocational rehabilitation. It is almost certain that her illness will not improve but will instead grow worse. After stabilization and with vocational rehabilitation, she may be capable of earning part-time income. If she should ever become capable of full-time employment, her beginning wage might be as high as $10.00 per hour: a gross monthly income of $1,720.00. It is extremely unlikely that [wife’s] mental illness will improve sufficiently for her to make successful use of her considerable education, ability, and intelligence.
Upon motions by both parties, the district court amended various parts of the judgment in December 2001 but did not amend the findings regarding wife’s mental illness or ability to work.
In February 2002, wife appealed to
this court, arguing that the district court abused its discretion by awarding
her maintenance in an amount less than that required to meet her needs, by
limiting to five years husband’s obligation to provide health insurance for
wife, and by inequitably dividing the parties’ marital property. This court reversed and remanded the case to
the district court, determining that (1) there were errors in the property
division that needed to be corrected, (2) the maintenance award needed to be
recalculated, (3) adequate provision needed to be made for wife’s retirement
needs, and (4) appropriate relief needed to be fashioned regarding wife’s
health-insurance needs. Jenson v. Jenson, No. C2-02-235, 2002
WL 1791419, at *3-*5, *7-*9 (
Upon remand, the district court issued another amended judgment (third judgment). In the third judgment, wife’s spousal maintenance was increased to $2,300 per month. The district court also found that wife “is capable of working in some capacity on a part-time basis, such as unskilled or entry-level positions.” The district court also made new findings regarding the property division and wife’s retirement needs and determined that husband should provide wife with health-insurance coverage until the occurrence of specified events.
January 2003, both parties moved to amend the third judgment or for a new trial;
the district court granted wife’s motion for a new trial. The parties agreed to submit evidence by
written affidavits and arguments. In
January2004, wife filed with the district
court an affidavit in which she stated that the Social Security Administration had
determined that she was “disabled from all work in the
July 2004, husband moved to vacate the fourth judgment and, in support of his
motion, submitted an affidavit stating that wife “began employment with Casual
filed a responsive motion and affidavits in opposition to husband’s motion,
including an affidavit dated
That I started doing part-time work at a clothing store ten to fifteen hours per week, I do not consider this a real job. I cannot support myself with the minimal amount I receive.
. . . .
It was my mistake not to disclose this, but to me employment is a real career job where I can use my skills and education.
In her July 2004 affidavit, wife also admitted that she did not seek review of her social-security disability status in May 2002.
In March 2005, the district court vacated the fourth judgment, determining that wife had committed fraud when she represented that she was not working. The district court’s order further denied all pending motions, thereby denying husband’s motion to amend the third judgment; the third judgment was revived when the district court provided in its order vacating the fourth judgment that “[a]ll prior orders of this Court shall remain in full force and effect unless modified by subsequent orders or specifically modified by this order.”
Wife appeals from the March 2005 order vacating the fourth judgment. Husband also appeals, arguing that the third judgment must be amended so that its conclusion of law regarding property division is consistent with its findings of fact. This court consolidated the parties’ appeals.
In its March 2005 order, the district court vacated the fourth judgment, determining that wife committed fraud on the court when she represented in her January 2004 affidavit that she was fully disabled and could not work. The district court found that it had increased wife’s spousal maintenance award “premised on the assumptions that [wife] was not employed and not capable of employment due to her mental illness.” The district court concluded that the fraud directly affected the terms of the fourth judgment, and, thus, the district court granted husband’s motion to vacate the fourth judgment and awarded husband $2,500 in attorney fees and costs.
court’s decision regarding whether to reopen a judgment will be upheld unless
the court abused its discretion. Harding v. Harding, 620 N.W.2d 920, 922
(Minn. App. 2001), review denied (
motion to vacate, he asked the court to reopen the fourth judgment under Minn.
Stat. § 518.145, subd. 2(3), the provision relating to ordinary fraud. Although the district court’s order determines
that wife committed fraud on the court, the order did not invoke Maranda’s discussion of fraud on the
court. Instead, it provided that the
“failure to fully and fairly disclose all income may constitute fraud” and in support
cited Clark v. Clark, No. C0-02-2016,
2003 WL 21152517 (
Wife maintains that she did not commit fraud that would warrant vacating the fourth judgment. In January 2004, the referee sent a letter to the parties stating that “[i]n the new trial on this matter, the facts presented shall be only those facts existing at the time of the original trial.” Wife contends that, based on this letter, her “misrepresentation” regarding her employment status in January 2004 was not material because it was not relevant to the district court’s determination of her employability at the time of the dissolution in October 2000. Wife further contends that her affidavit did not mislead the district court and opposing counsel because when the district court issued the fourth judgment, it “focused on the parties’ situation in 2000” and did “not rely or even consider [wife’s] employment status in 2003.”
It is clear that wife’s January 2004 affidavit, which contained (1) statements regarding her financial situation at the time of the first trial, i.e., statements regarding her disability status and lack of employment and (2) statements regarding her financial situation since the time of trial, i.e., statements regarding her depletion of retirement assets and increased debts, failed to make a complete disclosure of her financial situation. And it is also clear that the district court relied on wife’s affidavit. The judge who vacated the fourth judgment was the same judge who issued that judgment, and in the vacation order, he found that wife’s “fraud directly impacts” the provisions of the fourth judgment. In the third judgment, the district court found that wife had the ability to work part time; in the fourth judgment, the court found that wife did not have the ability to work. In the third judgment, the district court found that wife was temporarily disabled and was an excellent candidate for rehabilitative training; in the fourth judgment, the district court found that wife was “truly disabled.” In the fourth judgment, the district court made a new finding that wife’s “marital property has been used to meet her immediate living expenses.” In the third judgment, the district court awarded wife spousal maintenance of $2,300 per month; in the fourth judgment, the district court awarded wife spousal maintenance of $4,000 per month. Thus, because it is clear that wife’s “misrepresentation” affected the fourth judgment, we conclude that the district court did not abuse its discretion by vacating that judgment.
In its order vacating the fourth judgment, the district
court awarded husband “conduct-based fees in the amount of $2,500.” An award of
conduct-based attorney fees is discretionary and will not be disturbed absent
an abuse of that discretion. Dabrowski
v. Dabrowski, 477 N.W.2d 761, 766 (
Here, the district court found that wife’s “fraud and her failure to truthfully disclose her employment status and earnings has unreasonably frustrated and prolonged this proceeding.” Because the district court identified the “offending conduct,” the conduct occurred during litigation, and the district court found that the conduct “unreasonably frustrated and prolonged [the] proceeding,” we determine that the district court did not abuse its discretion by awarding husband conduct-based attorney fees.
The effect of the order vacating the fourth judgment was to revive the third judgment. Husband asserts, however, that the third judgment must be amended, maintaining that although the district court followed the remand instructions when it issued the third judgment, the conclusion of law regarding the property division is not consistent with the findings of fact. Wife agrees that the third judgment contains errors; she asserts, however, that the district court failed to follow this court’s mandate on remand regarding the property division and “exceeded its authority on remand by changing numerous findings that had not been under review nor a part of the remand.”
courts are given broad discretion to determine how to proceed on remand, as they may act in any way not inconsistent with the remand instructions provided.” Janssen
v. Best & Flanagan, LLP, 704 N.W.2d 759, 763 (
We conclude that on remand, the district court generally complied with this court’s instruction. It is clear, however, that there are errors in the third judgment’s conclusion of law relating to division of the parties’ property; many were corrected in the fourth judgment, but that judgment has been vacated. The errors include (1) omitting a credit to wife of $4,200 for her business’s telephone system; (2) omitting a credit to wife of $2,646 for new office equipment; (3) omitting a credit to wife of $2,900 for new furnishings for her apartment and business; (4) crediting each of the parties with $122,000 for their shares of husband’s 401(k) retirement plan rather than the correct amount of $144,776 each; (5) omitting an assignment of $41,166 in marital debt to husband to reflect a loan from husband’s 401(k) plan; (6) omitting a credit to each party of $44,481 for the proceeds from the sale of the Grand Avenue property; (7) omitting a credit to wife of $5,619 for a payment that husband made to her as directed by the original judgment; (8) omitting a credit to husband of $3,245 for the balance remaining in the Firstar Account after payment of marital debts; (9) omitting a credit to husband of $11,486 for an IRA; and (10) omitting a credit to wife of $2,783 for husband’s payment of excess spousal maintenance. The district court also erred by failing to reduce wife’s assets by $2,000 to reflect husband’s failure to pay spousal maintenance in September 2000; we note that the district court made this correction in the fourth judgment.
The third judgment also omitted a credit to husband for a computer in his possession. In the second judgment, the district court found that husband had a computer valued at $2,000 but did not credit this amount to husband. On appeal, this court determined that husband should have been credited with $2,000 for the computer. Jenson, 2002 WL 1791419, at *4. We note that in the third judgment, the district court found that the parties had three computers that were valued in total at $10,393; although the district court credited wife with $6,000 for computers, it did not credit husband for the computer in his possession. In the fourth judgment, the district court awarded wife two computers valued together at $6,000 and awarded husband the remaining computer, valued at $2,000. It is unclear why the value of the computers changed; on remand, the court should clarify the value of husband’s computer and wife’s two computers and award credits to each party accordingly.
Payments Made by Husband
Husband also asserts that
wife should receive a credit of $11,273.52 for a payment that he made on her
mortgage arrears and a $5,000 credit for a payment that he made to her
attorney. But the $11,273.52 payment of
mortgage arrears was credited to wife in the third judgment. We further determine that the $5,000 payment
should not be credited to wife because in the previous appeal, we determined that
the “attorney fee payment was considered in the valuation of the [
also asserts that a tax-loss carryover valued at $8,100 should be credited to
wife. In the third judgment, the
district court found that wife’s business had a tax-loss carryover of
$8,100. The district court then made two
inconsistent findings: it stated that the tax loss “may not be used to reduce
the parties’ personal tax liability but must remain with the corporation” but
also found that wife should be credited with the value of the tax-loss
carryover. It was not credited to wife,
however, in the conclusion of law regarding property distribution. In the previous appeal, this court noted that
the district court had specifically found in the first judgment that the “tax
loss, as a corporate loss, could not reduce [wife’s] taxes.”
Home-Equity Loan Proceeds
Husband also asserts that wife should have received a credit of $30,000 for the unaccounted-for portion remaining of a $42,000 home-equity loan secured by the parties’ homestead. In the third judgment, the district court found that $3,000 of the loan proceeds was spent for repairs on the homestead and $9,000 was spent on repairs to the parties’ rental property. The district court further found that the “remaining $30,000.00 has not been accounted for by [wife] and was presumably spent by [wife] on her business. [Wife] has not provided any records showing how the remaining $30,000 was spent. This amount shall be imputed to [wife] under [Minn. Stat. § 518.58, subd. 1a] when dividing the marital assets of the parties.” But wife was not credited with this amount in the conclusion of law dividing the parties’ property. We note that in the fourth judgment, the district court made a contrary finding that the $30,000 had “not been accounted for by either party and was deposited into the parties’ joint accounts to which each party had full access.” On remand, the district court should determine whether the $30,000 is an asset that should be imputed to either or both of the parties and explain its decision.
Wife also makes an argument
regarding the $30,000 in home-equity loan proceeds. In the previous appeal, this court determined
that the $30,000 from the home-equity loan seems “especially unlikely to
produce income” for wife because the district court presumed that it had been
spent on wife’s business.
Additional New Findings
Wife argues that the findings in the third judgment regarding her employability were not supported by the record and were outside of the scope of the remand instructions. The district court found that, after stabilization of her mental illness and rehabilitation, wife “may be capable of earning part-time income.” The district court based this finding on the testimony of a psychologist who stated that wife could work if her mental health improved; and the testimony of a vocational consultant who stated that wife would benefit from vocational rehabilitation and could work to help support herself in an entry-level position. Based on the record, the district court’s finding was not clearly erroneous.
Wife also maintains that the district court improperly
made new findings on the rental income from the parties’
We conclude, however, that all of the additional findings
that wife challenges were within the district court’s discretion in light of
this court’s directive in the previous appeal that the district court on remand
“may review the entire property division if consideration of the
above-discussed issues requires modification of other portions of the award to
effect an equitable division, making specific and thorough findings to ensure a
complete and equitable division of assets.”
In this court’s previous opinion, we determined that the
district court’s findings reflected its intent to fashion an equal property
division and that, thus, wife should be awarded with one-half of husband’s May
Parties’ Joint Bank Accounts
Wife asserts that the third judgment should be amended to
include an equal division of two of the parties’ joint bank accounts. In our previous opinion, we noted that the joint
bank accounts were not included in the property division in either the first or
second judgment and, thus, were effectively converted into husband’s assets
because the temporary award ordered wife to “transfer these accounts into the
sole name of [husband].”
Wife argues that in the
third judgment the district court should have “equally divided” payments that
husband received from a stock-purchase plan.
In the original judgment, the district court found that “[a]s of the
temporary hearing on
Wife’s Retirement Savings
Wife argues that in the third judgment, the district
court failed to make adequate provisions for her retirement needs. This court directed the district court on remand
to “make adequate provisions for [wife’s] retirement needs by either making
additional findings regarding the source of her retirement income, or
recalculating her reasonable monthly expenses in consideration of her need for
reasonable retirement savings.”
But in the third judgment, the court found that wife “has sufficient retirement assets to meet her needs” based on assets that wife received. The district court found (1) that wife was awarded a PERA retirement account with a value of approximately $3,100 and that if the account were invested at the rate of 10% per year for the next 14 years, wife would have $11,722 for retirement; (2) wife is defined as a “divorced wife” by the Social Security Act and, thus, will be eligible to receive an amount that is equal to one-half of the amount that husband will receive in social-security benefits, with her benefits estimated at $913.50 per month; and (3) the 401(k) account awarded to wife can continue to grow for the next 14 years until wife reaches the age at which she can begin to draw social-security benefits and that, assuming an annual return of 5%, wife would have retirement income of $41,664 per year. Thus, we conclude that the district court followed this court’s directive on remand by making “additional findings regarding the source of her retirement income.” See id.
Wife argues that the third judgment failed to properly consider the tax consequences of the payment and the receipt of spousal maintenance. In its original judgment, the court did not consider the tax consequences of either the payment or the receipt of spousal maintenance. But in the third judgment, the court found that
[t]he spousal maintenance payments received
by [wife] are included in [wife’s] gross income. Assuming [wife’s] filing status is single
with one exemption and she has no other deductions, her anticipated Federal tax
liability on income of $24,000 per year is $2,149 or $179 per month. [Wife’s] anticipated state tax liability is
$88.00 per month. [Wife’s] total tax
liability is $267.00 per month. These
figures are based upon Internal Revenue Service and State of
Wife maintains that according to the affidavit of her certified public accountant, the “correct amount” for federal taxes is $252.16 per month, or $3,026 annually, and for state taxes is $92.66 per month, or $1,012 annually. On remand, the district court should evaluate the tax consequences to the parties of the payment and of the receipt of spousal maintenance based on their current financial circumstances.
Wife argues that the district court failed to “fashion
appropriate relief” to protect her in the “area of medical insurance.” In the original judgment, the district court
ordered husband to provide wife with medical insurance for five years after the
date of the judgment. In the first
appeal, this court determined that the district court had found that it was
“highly unlikely” that wife would be able to secure employment in the future
and, thus, wife’s prospects for future employment were “not certain enough to
warrant placing the burden of proving a change of circumstances on [wife] in
five years, when her health care coverage runs out.”
Wife argues that the medical-insurance provision does not follow this court’s directive in that it puts her coverage within husband’s control because he can terminate his employment at any time. Instead, wife maintains that the district court’s determination in the fourth judgment correctly followed this court’s directive; in the fourth judgment, the district court determined that as additional spousal maintenance, husband shall continue to provide family medical insurance for wife through his employer or any subsequent employer until husband “no longer has a spousal maintenance obligation.” But we conclude that in the third judgment, the district court properly followed this court’s directive by removing the arbitrary selection of five years and, instead, providing wife with medical coverage until husband terminates his employment, coverage is no longer available, or medical insurance is available to wife through her employer.
To facilitate a final resolution of this matter, the district court on remand shall reopen the record to accept evidence regarding the parties’ current financial circumstances. The district court may also review the spousal-maintenance award and the entire property division if consideration of the parties’ current circumstances requires modification of other portions of the award to effect an equitable division, making findings to support its decision.
Affirmed in part, reversed in part, and remanded.
* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.
 “Unpublished opinions of the court of appeals are not
precedential.” Minn. Stat.
§ 480A.08, subd. 3(c) (2004).
Therefore, the district court erred “both as a matter of law and as a
matter of practice” by relying on an unpublished opinion of the court of
appeals. See Vlahos v. R & I Constr., Inc., 676 N.W.2d 672, 676 n.3 (