Rearden v. Rearden, Ky COA, Classification Of Property, Attorney Fees

Rearden v. Rearden, __ S.W.3d __ (Ky. App. 2009)

Rearden v. Rearden, __ S.W.3d __ (Ky. App. 2009)


The parties divorced after approximately 6 months of marriage.  No children were born during the marriage.  Thus, the primary issues at trial and on appeal concerned the classification of assets as marital or non-marital property:


Down payment on marital residence:  The trial court classified the husband’s pre-wedding down payment of $3000.00 from his personal money market account on the marital residence as marital.  Following the Source of Funds Rule, the COA found that the down payment was an identifiable portion of the purchase price and it was made by the husband prior to the wedding.  However, the husband could not trace the $526.87 refund received from the down payment during the marriage as a result of calculations in the closing documents.  COA held that $526.87 refund was marital property and that the remaining $2473.13 was husband’s non-marital property.


The treadmill, dining room suite, and bed/mattress:  The trial court classified these items as marital property since the husband could not sufficiently prove they were purchased with his non-marital funds.  COA agreed. Husband purchased the items with his personal credit card, but paid some of the credit card transactions using funds from the parties’ joint account.  The fact that the wife did not challenge husband’s testimony that he used non-marital funds to buy the items does not equate to an admission by the wife.  Husband still had to meet his burden of proof. 


Husband’s military retirement benefits:  The trial court found that since the parties were married for 2 months of husband’s 270 months of service credit, wife was entitled to $8.08 per month for the remainder of husband’s life.  Instead of requiring the husband to make such a small monthly payment to the wife, the court ordered husband to pay the wife a lump sum of $3000.  The court did not give an explanation of how it arrived at the lump sum amount.  COA agreed that the wife would be entitled to $8.08 per month for the rest of the husband’s life and that the trial court had discretion to convert the payments to a lump sum.  COA reversed and remanded for an explanation of how the court arrived at $3000.00 as a fair calculation of the wife’s future interest. 


The final issue on appeal concerned whether the trial court erred in not awarding the husband attorney fees after finding the wife to be in contempt of court more than once.  COA affirmed, finding that the trial court is not authorized to consider any other factors beyond the financial positions of the parties when awarding attorney fees.  COA also noted that the husband was awarded attorney fees in the companion appeal, specifically addressing the finding of contempt. 


Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

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