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Schultz v. Schultz

Supreme Court of North Dakota

December 6, 2018

Chad W. Schultz, Plaintiff and Appellant
v.
Kelli C. Schultz, Defendant and Appellee

          Appeal from the District Court of Stutsman County, Southeast Judicial District, the Honorable Troy J. LeFevre, Judge.

          Tressie C. Brazil, Fargo, ND, for plaintiff and appellant.

          Steven T. Ottmar, Jamestown, ND, for defendant and appellee.

          JENSEN, JUSTICE.

         [¶ 1] Chad Schultz appeals from a final judgment and decree of divorce entered on January 17, 2018 dissolving his marriage to Kelli Schultz. Chad appeals the district court's valuation of marital assets and the allocation of the marital estate. We affirm.

         [¶ 2] Chad and Kelli were married in September 2008 following a one and one-half- year period of cohabitation. In February 2016, after approximately seven and one-half years of marriage, the parties separated and Chad moved out of the marital home. The marriage was dissolved on January 17, 2018 by the filing of the final judgment and decree of divorce. Including the period of cohabitation, the time the parties were married and living together, and the time they were married and living apart, the parties were together for approximately ten and one-half years. The district court found the marriage to be a "long-term" marriage.

         [¶ 3] In 2001, prior to the parties' marriage, Chad inherited a fifty percent interest in three separate quarters of Nelson County farmland. The parties agreed that Chad would receive the farmland in the property distribution, but disagreed whether a reciprocal value should be allocated to Kelli. Chad argued that when considering the length of the marriage and that he inherited the property prior to marriage, the property should be allocated to him without a reciprocal allocation of value to Kelli. Kelli requested an equal division of the farmland's value through post-judgment payments to her from Chad. The district court's property division allocated a reciprocal value to Kelli and ordered a series of post- judgment equalization payments from Chad to Kelli. The post-judgment payments included an interest rate of 4%.

         [¶ 4] The parties also disputed the valuation of the farmland. Chad and his father, Herbert Schultz, testified to their opinions on the value of each quarter. Kelli's values for the farmland came from the 2017 County Rents and Values survey funded by the North Dakota Department of Trust Lands. The district court valued the farmland between the amounts suggested by the parties.

         [¶ 5] In 2010, the parties purchased Face 2 Face Salon ("Salon") as a business to be operated by Kelli. The parties agreed that Chad paid $35, 000 of the purchase price, and Kelli paid $5, 000 towards the purchase price. The parties agreed the Salon would be distributed to Kelli, but disputed the valuation of the Salon. Kelli argued the Salon was worth $40, 000, while Chad argued the Salon was worth $160, 000. The district court found the Salon to have a value of $40, 000.

         [¶ 6] In June 2016, Chad's father, Herbert Schultz, finished building a home located in Jamestown, North Dakota. Title to the property was held jointly by Chad and his father. The parties disagreed on whether the home should be considered marital property. Chad argued, and his father also testified, the property should not be considered marital property because Chad's name appeared on the title only for the purpose of estate planning, the home was built at the end of the parties' marriage, and the funds used to build the home were from an inheritance received by Herbert Schultz. Kelli argued the property should be included because the deed provided that the property was held jointly by Chad and his father. The district court included one-half of the value of a one-half interest in the property in the marital estate.

         [¶ 7] During the marriage, Chad was employed by the State of North Dakota and participated in the NDPERS retirement plan. All the contributions to the account were made during the marriage. Chad argued he should be allocated the entire NDPERS account, and Kelli should be allocated her MFS Roth IRA account. Kelli argued she should receive a portion of Chad's NDPERS account under the "Bullock" formula. The district court allocated the NDPERS account evenly between the parties and ordered the account to be split through the use of a Qualified Domestic Relations Order.

         [¶ 8] Prior to the marriage, Kelli owned a home, subject to a mortgage. The parties used the residence as their marital home during the majority of the marriage. Chad paid $21, 500 during the marriage to satisfy the mortgage. Chad also testified that he paid for improvements to the home and contributed the labor to complete improvements to the home. Chad argued his contribution to the payment of the mortgage should be offset against the property allocated to Kelli. The district court declined to make the requested offset.

         [¶ 9] Chad challenges the district court's overall allocation of the parties' marital property. He contends the district court erred by finding the marriage was "long- term," incorrectly valuing the farmland, not allocating the farmland to him without a reciprocal allocation to Kelli, incorrectly valuing the Salon, awarding Kelli a portion of his NDPERS retirement account, including his father's home in the marital estate, the inclusion of a property equalization payment, and applying a 4% interest rate to the equalization payment.

         [¶ 10] In determining an equitable division of a marital estate, a district court is required to consider the Ruff-Fischer guidelines. Lill v. Lill, 520 N.W.2d 855, 857 (N.D. 1994). Along with the other factors included within the Ruff-Fischer guidelines, the district court is required to consider the duration of the marriage and source of the property in determining an equitable allocation of the parties' marital property. There is no bright-line rule to distinguish between short and long-term marriages. Hitz v. Hitz, 2008 ND 58, ¶ 16, 746 N.W.2d 732. Generally, a long-term marriage supports an equal division of all marital assets. Bladow v. Bladow, 2003 ND 123, ¶ 8, 665 N.W.2d 724. In a short-term marriage, the district court may distribute property unequally and award the parties what each brought into the marriage. See Buzick v. Buzick, 542 N.W.2d ...


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