This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (1996).




In Re the Marriage of:

Kermit Edward Mahan, petitioner,



Bryce Jingle Mahan,


Filed February 24, 1998

Affirmed in part and remanded in part

Holtan, Judge**

Mower County District Court

File No. F296476

Michael Ormond, Ormond Law Offices, 300 Sexton Building, 529 South Seventh Street, Minneapolis, MN 55415 (for appellant)

Bryan J. Baudler, Baudler, Baudler, Maus & Blahnik, 108 North Main Street, Austin, MN 55912 (for respondent)

Considered and decided by Willis, Presiding Judge, Davies, Judge, and Holtan, Judge.

*Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.



Appellant-wife claims the district court erred by awarding her temporary maintenance without addressing her ability to become self-supporting, imputing income to her without finding her voluntarily unemployed, and not considering the property distribution's tax consequences. Because the property distribution is within the district court's discretion, but the findings do not support the maintenance award, we affirm in part and remand in part.


Appellant-wife Bryce Jingle Mahan and respondent-husband Kermit Edward Mahan married in 1965. In 1988, wife worked and lived away from home part-time. When wife bought a business in 1989, she spent less time at home. In 1995, wife stopped commuting back home, and in 1996, the parties stopped sharing expenses. Husband petitioned for dissolution. After trial, the district court imputed income to wife, awarded her temporary maintenance and interests in various retirement accounts, but did not consider the tax consequences of wife's plan to liquidate the accounts. Wife appeals.


Absent a new trial motion, review is limited to whether the evidence supports the findings and whether the findings support the conclusions of law and the judgment. Gruenhagen v. Larson, 310 Minn. 454, 458, 246 N.W.2d 565, 569 (1976); Erickson v. Erickson, 434 N.W.2d 284, 286 (Minn. App. 1989). Findings of fact are not set aside unless clearly erroneous and appellate courts defer to district court credibility determinations. Minn. R. Civ. P. 52.01; Sefkow v. Sefkow, 427 N.W.2d 203, 210 (Minn. 1988).

1. Absent an abuse of its "wide discretion" in awarding maintenance, "the trial court's determination is final." Erlandson v. Erlandson, 318 N.W.2d 36, 38 (Minn. 1982). An abuse of discretion occurs if the district court makes "a clearly erroneous conclusion that is against logic and the facts on record." Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984). Although Minn. Stat. § 518.552 (1996) 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. If uncertainty exists about the need for permanent maintenance, the district court "shall" award permanent maintenance and leave the award open for future modification. Minn. Stat. § 518.552, subd. 3; see Dobrin v. Dobrin, 569 N.W.2d 199, 201 (Minn. 1997) (discussing standard for awarding permanent maintenance).[1]

Wife claims her temporary maintenance award is unsupported by the findings because the district court failed to address her ability to become self-supporting, her net income, and her reasonable monthly expenses. Review of maintenance awards requires findings showing the district court "consider[ed] all factors relevant to an award of permanent spousal maintenance." Stich v. Stich, 435 N.W.2d 52, 53 (Minn. 1989). Because Minn. Stat. § 518.552, subd. 3, states permanent maintenance "shall" be awarded if there is uncertainty about a party's need for permanent maintenance, a party's ability to become self-supporting is a factor relevant when deciding whether to award permanent maintenance. See Minn. Stat. § 645.44, subd. 16 (1996) ("'[s]hall' is mandatory"). The judgment, however, does not address when or if wife would become self-supporting. Indeed, the judgment could not address wife's ability to become self-supporting because, while it found her "earning capacity," and that her reasonable monthly expenses were "at least $2000," it did not specifically find either wife's net monthly income or her reasonable monthly expenses. Inadequate findings require the maintenance issue to be remanded. Stevens v. Stevens, 501 N.W.2d 634, 637 (Minn. App. 1993). Cf. Hecker v. Hecker, 568 N.W.2d 705, 709 (Minn. 1997) (although stipulations merge into dissolution judgments, stipulations are important for modifications because they identify "baseline circumstances" against which claims of changed circumstances are measured).

2. Wife claims the district court erred by imputing income to her without finding her to be unemployed or underemployed in bad faith. A finding of bad faith unemployment or underemployment is a prerequisite for using earning capacity when setting maintenance. See id. at 709-10 (imputing income to maintenance recipient who "disregarded" stipulation's "spirit" requiring "good faith effort" to become self- supporting). Husband admits the district court did not address whether wife was unemployed or underemployed in bad faith, but he functionally claims the failure to make this finding is harmless because the finding of wife's earning capacity excludes her monthly payment for the business and that if this payment is included, it will allow her to meet her needs. See Minn. R. Civ. P. 61 (harmless error to be ignored). Because wife's claimed monthly expenses do not include the business payment, to include the payment in her income without considering the associated liability would distort wife's finances. Also, while the business payment ended in October 1997, the district court noted wife intended to incur various business-related expenses and found the expenses "reasonable." After paying these expenses, the pre-tax increase in wife's monthly income will be $81.62. Because this is not enough to allow her to meet even $2,000 in monthly expenses, the district court's failure to address whether wife was unemployed or underemployed in bad faith is not harmless.[2]

3. Wife claims the district court erred in not considering the tax consequences of her planned liquidation of the retirement accounts awarded to her. Generally, (a) whether to consider a property distribution's tax consequences is discretionary with the district court; (b) such considerations are not controlling; and (c) district courts are "willing to consider only those tax consequences that arise from the distribution itself" and are "hesitant to consider the possible tax consequences of either party's future dealings with the property." Aaron v. Aaron, 281 N.W.2d 150, 153 (Minn. 1979). Aaron did state, however, that "in a proper case" the district court "should" consider the tax consequences of a property distribution and suggested that a "proper case" was one where a sale of an asset "is required [by the property distribution] or is likely to occur within a short time after the dissolution." Id.

To support her argument, wife cites Reynolds v. Reynolds, 498 N.W.2d 266, 271 (Minn. App. 1993), a case in which she claims the taxable event was "imminent." The reason the taxable event in Reynolds was "imminent" was because it was beyond the control of the appealing party. Here, wife's liquidation of the retirement accounts is not required by the property distribution, and the district court did not abuse its discretion by not considering the possible tax consequences. See Salstrom v. Salstrom, 404 N.W.2d 848, 853 (Minn. App. 1987) (affirming refusal to consider tax consequences where record did not show asset liquidation was required); Hattstrom v. Hattstrom, 385 N.W.2d 332, 336 (Minn. App. 1986) (same), review denied (Minn. June 30, 1986).

4. Whether to reopen the record on remand shall be discretionary with the district court. We express no opinion on how to decide the remanded issues.

Affirmed in part and remanded in part.

[1] We note Dobrin was issued after the district court made its decision in this matter.

[2] Wife claims under Carrick v. Carrick, 560 N.W.2d 407, 410-11 (Minn. App. 1997), she cannot be found to be unemployed or underemployed in bad faith because she was awarded the business and continued to work for it after the dissolution as she had before the dissolution. Husband, however, did not object to the purchase of the business because the parties hoped it, combined with other work, would allow wife to make about the same amount she made before she lost a previous job. Because Carrick does not involve such a condition, it is distinguishable.