This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2006).
IN COURT OF APPEALS
In re the Marriage of:
Gwenne Melisa Olsen, petitioner,
Filed August 21, 2007
Affirmed as modified
Dakota County District Court
File No. F5-05-14654
Jenny L. Ryan, Katie Trotzky, Legal
Assistance of Dakota County, Ltd.,
Nathan M. Hansen, Peggy L.
Considered and decided by Ross, Presiding Judge; Shumaker, Judge; and Parker, Judge.*
U N P U B L I S H E D O P I N I O N
Appellant challenges the district court’s dissolution judgment and decree, arguing that the district court abused its discretion by (1) overvaluing and improperly dividing his 401(k) account; (2) undervaluing his nonmarital interest in the parties’ home; (3) overvaluing his interest in two vehicles and mischaracterizing the parties’ trailer as marital property; (4) not rejecting all of respondent’s testimony after being impeached; and (5) ordering compliance with discovery requests after the discovery deadline. We affirm the district court’s judgment but modify the value of appellant’s interest in the two vehicles.
Appellant Chad Eric Olsen and respondent Gwenne Melisa Dykoff (f/k/a Gwenne Melisa Olsen) married in March 2003 and had one child together. The marriage was dissolved in July 2006. The parties’ marriage was tumultuous, marked by multiple instances of domestic violence.
As a result of the domestic abuse, Olsen was convicted of making terroristic threats. Olsen took out a $10,000 loan from his 401(k) account to help pay for his criminal defense. Dykoff co-signed for the loan, as required by company policy. The retirement account had a value of $14,559.04 when the parties married and a value of $22,619.11 on the valuation date for property-division purposes. The account statement shows that the account value decreased $10,000 due to the loan.
The district court issued a scheduling order directing that all discovery be complete by January 1, 2006. Dykoff’s attorney served document requests and interrogatories on Olsen’s attorney on December 9, 2005. Olsen’s attorney refused to respond “[d]ue to lack of timeliness.” Dykoff’s attorney moved to compel and the district court granted the motion on February 1, 2006, and provided Olsen an additional nine days to comply. Olsen’s attorney did not comply with the February 1 order, causing additional trial delays.
evidence at trial shows that Olsen purchased a home in
The parties stipulated that they purchased a trailer during the marriage, although Olsen later testified that he used some nonmarital funds to purchase it. Olsen also testified that he purchased an all-terrain vehicle (ATV) and snowmobile before the marriage. After the marriage, Dykoff spent $11,300 in nonmarital funds to pay off encumbrances on those vehicles, and they had a combined value of $8,380 at the valuation date.
The district court issued a final order for judgment and amended it on Olsen’s motion. The district court found the marital portion of Olsen’s 401(k) to be worth $18,060.07. The district court arrived at this figure by adding the actual value of the account ($22,619.11) to the loan ($10,000) and subtracting Olsen’s nonmarital interest of $14,559.04.
district court found that the
district court awarded Olsen: (1) Dykoff’s nonmarital interest of $11,300 in
the ATV and snowmobile; (2) $2,150 marital interest in the trailer; and (3)
$9,303.03 of the marital interest in his 401(k). The court awarded Dykoff: (1) Olsen’s nonmarital
interest in the
D E C I S I O N
courts have broad discretion over the division of marital property and
appellate courts will not alter a district court’s property division absent a
clear abuse of discretion or an erroneous application of the law.” Sirek
v. Sirek, 693 N.W.2d 896, 898 (
“Whether property is marital or non-marital is a
question of law, but we defer to the district court’s underlying findings of
fact.” Senske v. Senske, 644 N.W.2d 838, 840 (
district court may award nonmarital property if the division of marital
property is “so inadequate as to work an unfair hardship.” Minn. Stat. § 518.58, subd. 2
(2006). The court must make findings to
support an apportionment of nonmarital property due to unfair hardship, and may
divide only up to one-half of nonmarital property in such cases.
1. 401(k) loan
Olsen argues that the district court abused its discretion by apportioning the 401(k) loan entirely to him and by characterizing the loan as a withdrawal.
Debt apportionment is part of property division, and
district courts are “not required to apportion marital debts but [are] only
required to meet the just and equitable standard of property divisions.” Berenberg
v. Berenberg, 474 N.W.2d 843, 848 (Minn. App. 1991), review denied (Minn. Nov. 13, 1991). Marital property must be divided equitably,
but it need not be divided equally.
Minn. Stat. § 518.58, subd. 1 (2006); Riley v. Riley, 369 N.W.2d 40, 43 (
Olsen contends that the loan is a marital debt and that the district court inequitably apportioned the debt entirely to him. The district court found that the loan paid for Olsen’s attorney fees and that he “is liable alone to pay the loan incurred for his legal defense . . . .”
We hold that the record supports the
district court’s finding that the parties incurred the debt to pay for Olsen’s
legal defense stemming from charges relating to domestic violence. Furthermore, the record shows that Olsen has
a substantially greater ability to pay the debt; Dykoff earns $1,376.53 per
month with $3,328 in monthly living expenses, while Olsen makes $2,193.06 per
month with $1,450 in expenses. Therefore,
we conclude that the district court did not abuse its discretion by
apportioning the debt entirely to Olsen.
See Dahlberg v. Dahlberg, 358
N.W.2d 76, 80 (
Next, Olsen argues that that district court erred by finding that the loan was taken from his 401(k) account. Olsen contends that his 401(k) was merely collateral for the loan and that the district court improperly added back the loan to calculate the value of the account. We disagree.
The record shows that Olsen’s 401(k) account balance decreased $10,000 due to the loan. Additionally, Olsen’s “participant loan policy” shows that his account was the source of the loan and not simply collateral. Once the loan is repaid in full, the $10,000 account liability will disappear, so in effect Olsen is not paying twice on the loan, as he argues. Therefore, the district court did not abuse its discretion by adding back the loan from Olsen’s 401(k) to determine the value of the account.
2. Marital home
Olsen also argues that the district court undervalued his nonmarital interest in the parties’ home. Olsen contends that the district court improperly applied the Schmitz formula in calculating his nonmarital interest in the marital homestead.
The Minnesota Supreme Court summarized the formula for calculating marital and nonmarital interests in property acquired during the marriage using nonmarital funds:
The present value of a nonmarital asset used in the acquisition of marital property is the proportion the net equity or contribution at the time of acquisition bore to the value of the property at the time of purchase multiplied by the value of the property at the time of separation. The remainder of equity increase is characterized as marital property . . . .
Brown v. Brown, 316 N.W.2d 552, 553 (
The supreme court has
subsequently recognized that “the Schmitz
formula may be used to determine marital and nonmarital interest in property
acquired during the marriage with a nonmarital down payment . . . as
well as property acquired before the marriage.”
Antone, 645 N.W.2d at
102. When calculating the nonmarital
interest in property acquired before the marriage, “the formula uses the time
of the marriage instead of the time of the purchase.”
[t]he present value of a [nonmarital interest in property acquired before the marriage] is the proportion the net equity . . . at the time of [the marriage] bore to the value of the property at the time of [the marriage] multiplied by the value of the property at the time of separation. The remainder of equity increase is characterized as marital property . . . .
Here, the district court
purported to apply the Schmitz formula
to determine Olsen’s nonmarital interest in the parties’ marital home. To do so, the court needed to calculate
Olsen’s nonmarital interest in the
The parties purchased the
3. Vehicles and trailer
Olsen contends that the district court clearly erred by overvaluing the ATV and snowmobile, and erred by finding that the trailer purchased during marriage is marital property.
The court awarded Olsen the ATV and snowmobile and valued them at $11,300 for purposes of the distribution—Dykoff’s nonmarital contribution to their purchase. The court found, however, that the combined current value of the vehicles is $8,380. The difference between the value of the vehicles found by the district court and the amount awarded by the district court is $2,920, and we therefore modify the value of the award to account for this difference. We note that this difference does not practically affect the result because the district court did not order the property sold.
The district court also found that the parties’ trailer, purchased during the marriage, was marital property and divided its value equally. Olsen argues that he used nonmarital funds to purchase the trailer and that Dykoff waived any interest in the property.
The record shows that the parties
stipulated that Olsen used all of the proceeds from the sale of the
Similarly, it is not clear from the record that Dykoff waived her marital interest in the trailer. Olsen argues that Dykoff “conceded any marital claim to the Haulmark Trailer.” But the record shows that Dykoff’s attorney stated that “[Dykoff] asserts [the trailer] is marital” and did not make an unequivocal waiver of any marital interest in the trailer. Accordingly, the district court did not abuse its discretion by dividing the trailer equally between the parties.
4. Witness credibility
Olsen argues that the district court
abused its discretion by not excluding all of Dykoff’s testimony. Olsen alleges that Dykoff made an intentional
misrepresentation of a material fact at trial, and, therefore, “no credence
need be given to [her] testimony.” Segerstrom v. Nelson, Mullen & Nelson,
Olsen contends that Dykoff knowingly
misrepresented the date when Olsen last saw the parties’ child. But the record shows that Dykoff’s testimony
was not definitive regarding Olsen’s parenting-time schedule and that she was
tired and nervous during her testimony.
Although the district court was free to disregard testimony it deemed
unreliable, it did not do so in this case, and we defer to the district court’s
credibility determinations. Sefkow v. Sefkow, 427 N.W.2d 203, 210 (
Finally, Olsen argues that the district court abused its discretion by granting Dykoff’s motion to compel discovery. Olsen contends that the district court did not comply with its own scheduling order and contravened the rules of civil procedure because Dykoff’s discovery requests were untimely.
The district court has broad discretion to determine
the procedural calendar of the case. Rice v. Perl, 320 N.W.2d 407, 412 (
The record shows that the scheduling order closed discovery on January 1, 2006, and that Dykoff’s attorney served document requests and interrogatories on December 9, 2005. Olsen’s attorney did not answer because the rules provide 30 days to respond, which could have extended discovery beyond January 1. Dykoff moved to compel discovery on January 13, and the district court granted her motion.
The rules provide 30 days to respond
to document requests and interrogatories, but it does not mandate that parties
must wait 30 days before responding.
Affirmed as modified.
* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.