This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2004).






In re the Marriage of:


Michael Joseph Saul, petitioner,





Danetta Parker Saul,



Filed September 5, 2006


Worke, Judge


Ramsey County District Court

File No. DM-F8-03-1296


Michael C. Black, Michael C. Black Law Office, Ltd., 265 West Seventh Street, Suite 201, St. Paul, MN 55102 (for respondent)


Terri A. Melcher, 6401 University Avenue N.E., Suite 201, Fridley, MN 55432 (for appellant)


            Considered and decided by Toussaint, Chief Judge; Stoneburner, Judge; and Worke, Judge.

U N P U B L I S H E D   O P I N I O N

WORKE, Judge

            On appeal in this dissolution matter, appellant argues that the district court abused its discretion by (1) failing to credit her in the property division with certain private-school tuition she paid for the parties’ children; (2) overvaluing certain retirement funds and not accounting for certain taxes on those funds; (3) failing to treat a certain tax obligation incurred by appellant as marital; (4) understating the marital portion of an investment account; (5) overstating the marital portion of her retirement plan and failing to properly account for the taxes due on those funds; and (6) finding that respondent adequately traced his nonmarital interest in a business.  Because we find no clear error in the district-court findings, we affirm. 


Marital Property Division

            District courts have broad discretion over the division of marital property, and this court will not alter the district court’s division of property absent a clear abuse of discretion or an erroneous application of the law.  Chamberlain v. Chamberlain, 615 N.W.2d 405, 412 (Minn. App. 2000) (clear abuse of discretion), review denied (Minn. Oct. 25, 2000); Ebnet v. Ebnet, 347 N.W.2d 840, 842 (Minn. App. 1984) (misapplication of the law).  “We defer to the [district] court’s findings of fact and will not set them aside unless they are clearly erroneous.”  Antone v. Antone, 645 N.W.2d 96, 100 (Minn. 2002). 


            Appellant Danetta Parker Saul argues that the district court erred by failing to take into account the $1,225 tuition payment she made in November 2003 when the district court ordered each party responsible for one-half of their children’s tuition for school years 2003-04 and 2004-05.  Appellant’s argument is meritless.  The district court found that there was $9,010 due for past tuition for the 2003-04 school year and $6,000 due for tuition for the 2004-05 school year.  Tuition statements from December 2003 and May 2004 show an unpaid balance of $9,010 ($4,635 past due, plus $5,600 tuition, less $1,225 payment).  The district court’s calculation of the unpaid tuition includes credit for appellant’s $1,225 payment.  Because appellant does not argue that the district court erred in ordering each party to pay one-half of the tuition, and the $1,225 payment was deducted, the district court did not err in finding that $9,010 remained unpaid for the 2003-04 school year.

            Travelers Life and Annuity Account

            Appellant next argues that the district court clearly erred in finding that she failed to prove that the liquidation of her Travelers Life and Annuity account, which occurred after service of the summons and petition, was necessary to pay for her and the parties’ minor children’s living expenses.  Under Minn. Stat. § 518.58, subd. 1a (2004), if a party to a dissolution proceeding disposes of, transfers, encumbers, or otherwise conceals a portion of marital assets outside the usual course of business or for the necessities of life, “the court shall compensate the other party by placing both parties in the same position that they would have been in had the transfer, encumbrance, concealment, or disposal not occurred.”  The district court “may impute the entire value of an asset and a fair return on the asset to the party who transferred, encumbered, concealed, or disposed of it.”  Minn. Stat. § 518.58, subd. 1a. 

            The district court found that following service of the summons and petition, and without respondent Michael Joseph Saul’s consent, appellant liquidated her Travelers Life and Annuity account in the amount of $22,804.66.  The district court also found that while appellant testified that she needed the funds for life necessities, she failed to explain how she used the funds, with the possible exception of the $1,225 tuition payment.  This court must give deference to the district court’s assessment of witness credibility.  Sefkow v. Sefkow, 427 N.W.2d 203, 210 (Minn. 1988); see also Minn. R. Civ. P. 52.01.  Because it is within the province of the district court to make witness credibility determinations, and the record lacks any documentation or explanation as to how appellant used the funds, the district court did not err in concluding that appellant received $22,804.66 in marital funds from the liquidated account.

             Appellant’s 2002-03 Tax Liabilities

            Appellant also argues that the district court erred in finding that she is solely responsible for her 2002 and 2003 income tax liabilities.  Appellant testified that she felt that respondent was deceiving her in the preparation of the parties’ joint tax returns; thus, in 1998, the parties began filing separate tax returns.  At the time of trial, appellant owed $25,707.20 to the Internal Revenue Service and $3,494.14 to the Minnesota Department of Revenue for unpaid income taxes for 2002 and 2003.  The tax debts were the result of appellant failing to withhold sufficient sums from her income to pay the taxes on her pension benefits and the early withdrawal from her Travelers annuity account.  Respondent also had tax liabilities for tax years 2002 and 2003; however, his taxes were paid at the time of trial.  The district court concluded that it would be inequitable to require respondent to contribute to appellant’s tax debts.  Because the record shows that the parties had filed separate tax returns since 1998 and the reason for appellant’s significant tax liability is partly due to the liquidation of her Travelers annuity account, the district court did not abuse its discretion in holding appellant solely responsible for her unpaid taxes.

            Deposit to Smith Barney IRA

            Appellant next argues that the district court erred in its finding regarding the value of respondent’s Smith Barney IRA because it failed to take into account a $3,500 deposit respondent made following the December 31, 2003 valuation date.  A district court has broad discretion in dividing property and setting reasonable valuation dates.  Desrosier v. Desrosier, 551 N.W.2d 507, 510 (Minn. App. 1996).

            A district court must value marital assets on the day of the initial prehearing conference, unless otherwise stipulated or unless the district court makes findings that another date is fair and equitable.  Minn. Stat. § 518.58, subd. 1 (2004).  A district court may also adjust the valuation of an asset when “there is a substantial change in value of an asset between the date of valuation and the final distribution.”  Id.  The parties stipulated to a valuation date of December 31, 2003, and a value of $4,108.74 for the Smith Barney IRA account.  Stipulations in dissolution cases are favored by the courts because they simplify and expedite litigation.  Anderson v. Anderson, 303 Minn. 26, 31, 225 N.W.2d 837, 840 (1975).  “Stipulations are therefore accorded the sanctity of binding contracts.”  Shirk v. Shirk, 561 N.W.2d 519, 521 (Minn. 1997).

            The district court noted respondent’s $3,500 contribution in 2004 for the tax year 2003, and the fact that the contribution may have increased the value of the account.  But the district court adopted the $4,108.74 figure based on the parties’ stipulation.  Because the district court recognized respondent’s contribution and because the parties stipulated to the amount, the district court did not abuse its discretion in finding that the account had a value of $4,108.74.     

            Nonmarital Interests

            Appellant argues that the district court erred in its findings regarding the marital portion of her benefits through the Teacher’s Retirement System of Louisiana (TRSL) and respondent’s nonmarital interest in Saul Enterprises, Inc.

Whether property is marital or nonmarital is a question of law, but a reviewing court must defer to the [district] court’s underlying findings of fact.  However, if we are left with the definite and firm conviction that a mistake has been made, we may find the [district] court’s decision to be clearly erroneous, notwithstanding the existence of evidence to support such findings. 


Olsen v. Olsen, 562 N.W.2d 797, 800 (Minn. 1997) (quotation and citations omitted). 


            TRSL Retirement Account

            Appellant argues that the district court erred in its finding regarding the marital value of her TRSL retirement account.  The district court found that the marital value of the account to be $91,969.  Appellant’s TRSL pension income was based on 20 years of pension service credit.  When the parties moved to Minnesota, appellant had only 19 years of service.  Respondent made a $14,549.27 payment from a nonmarital account to purchase .99 year of pension service, which enabled appellant to immediately receive her full monthly retirement benefit.  Appellant gave respondent the first 11 pension payments to restore respondent’s nonmarital account.  At trial, a pension actuary determined that the marital portion of the pension was 8.49 years: the earned marital portion of 7.5 years and the purchased .99 year of service.  Appellant argues that the .99 year of service should not be treated as marital and that the marital portion of the account is $82,362.  But appellant failed to provide any expert testimony to rebut the pension actuary’s valuation.  Because the .99 year of service was not earned, but rather purchased by respondent, the only reasonable inference is that it is marital.  Based on the record, the district court did not clearly err. 

            Saul Enterprises, Inc.

            Appellant argues that the district court erred in its finding regarding respondent’s nonmarital interest in Saul Enterprises, Inc.  The parties stipulated that the net value of the business on December 31, 2003, was $218,278.65.  Respondent claimed that $207,000 of the company’s value is nonmarital and that he completed a nonmarital tracing of those funds to assets he acquired prior to the marriage. 

            All property, real or personal, is presumed to be marital if “acquired by the parties, or either of them . . . at any time during the existence of the marriage relation between them, or at any time during which the parties were living together as husband and wife[.]”  Minn. Stat. § 518.54, subd. 5 (2004).  Nonmarital property is real or personal property “acquired by either spouse before, during, or after the existence of their marriage, which (a) is acquired as a gift, bequest, devise or inheritance made by a third party to one but not to the other spouse; [or] (b) is acquired before the marriage[.]”  Id.  Nonmarital property includes “both property acquired before the marriage and the increase in value of that property.”  Quinlivan v. Quinlivan, 359 N.W.2d 276, 279 (Minn. App. 1984).  “A party seeking to establish the nonmarital character of an asset must do so by a preponderance of the evidence.  In order to maintain its nonmarital character, nonmarital property must be kept separate from marital property or, if commingled, must be readily traceable.”  Wopata v. Wopata, 498 N.W.2d 478, 484 (Minn. App. 1993) (citations omitted); see also Carrick v. Carrick, 560 N.W.2d 407, 413 (Minn. App. 1997) (noting that the standard required is not “strict tracing,” but a preponderance of the evidence).  

            In 1976, respondent was the sole proprietor of Academy Pest Elimination Service Technologies (APEST).  When the parties married in 1983, the company had approximately $500,000 in gross annual sales.  The company continued to make this amount through 1986, when it was purchased for $250,000.  Appellant argues that the income generated from the sale was marital because respondent failed to meet his burden of proof as to the value of APEST at the time of the marriage and that the value of the corporation did not increase during the marriage.  Appellant contends that the value of the corporation at the time of the marriage, based on the balance sheet included in APEST’s 1983 corporate income tax return, was $57,794.  However, as respondent correctly points out, this fails to take into consideration the corporation’s annual sales, which were based on service contracts with customers.  APEST’s sales income in 1983 was $506,273 and $518,010 in 1984.  The record shows that those figures continued through 1986 when the corporation was sold.  Appellant also argues that her efforts during the marriage created a marital component in the value of APEST.  However, the record shows that appellant worked at the corporation as a secretary for six months.  Appellant’s own testimony—that she had no further role in the company—supports the denial of a marital component based on her contribution to the value of the corporation.  The district court properly determined that respondent was able to trace his assets from the sale of APEST into five investment accounts.  The district court’s finding that respondent has a nonmarital interest in Saul Enterprises, Inc. in the amount of $207,000 is supported by the record and is not clearly erroneous.  Further, the district court did not err in failing to include the reduction of the balance of Saul Enterprises, Inc.’s business loans during 2004.  The parties stipulated to the valuation date and the value of the company on that date.  It is only logical that business loans that are paid by monthly payments would be reduced between the valuation date and trial. 

            Finally, there is no evidence in the record to support a finding of “unfair hardship” under Minn. Stat. § 518.58, subd. 2 (2004).  This court generally considers “only those issues that the record shows were presented and considered by the [district] court in deciding the matter before it.”  Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988).  Because appellant failed to raise this issue in the district court, we will not address it on appeal.