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Steeland v. Steeland

Court of Appeals of Arkansas, Division I

November 14, 2018



          Gary J. Barrett, for appellant.

          Daggett & Perry, PLLC, by: Joe R. Perry, for appellee.


         This is an appeal following a divorce proceeding between appellant Mike Steeland and appellee Bobbie Jo Steeland. The parties were married in 2004 and have a daughter. The parties divorced by a decree entered in September 2011, and custody of their child was awarded to Bobbie Jo, but the remaining issues were reserved for later determination. In an order filed on December 19, 2016, the trial court resolved the issues of Mike's child-support obligation and the division of assets and debts. Mike appeals the December 2016 order, arguing the trial court clearly erred in its determination of his child-support obligation; in its failure to establish a value of PSI Rentals, LLC; in awarding the home where the parties lived to Bobbie Jo; and in not explaining why it divided the marital estate unevenly. We affirm as to child support, but we reverse and remand as to the remaining three points. Therefore, we affirm in part and reverse and remand in part.

         We first address Mike's argument that the trial court erred by using his gross weekly income instead of determining his net weekly income on which to calculate his child-support obligation. He argues that the trial court found his average weekly income to be $2, 000 but that this was incorrect because the trial court failed to deduct "federal and state income tax and medical insurance" as required by Administrative Order No. 10. Mike asserts that his net weekly income was $1, 247.91, as shown on his Affidavit of Financial Means (AFM). Mike adds that the trial court erred by failing to explain why it deviated his support obligation upward to include payment of the child's tuition, bus fees, and all health/dental/orthodontic needs.

         Bobbie Jo argues that Mike is self-employed and underreported his income on his AFM and that the evidence would have supported an even higher average weekly income than that set by the trial court. Bobbie Jo points out that the trial court was presented with Mike's testimony establishing that his AFM excluded certain income and that he earned $184, 000 in one year. Bobbie Jo adds that the testimony showed that Mike's businesses provided him with a company vehicle, fuel, insurance, and a cell phone. Bobbie Jo asserts that, given the evidence provided to the trial court, it cannot have abused its discretion in setting Mike's child support based on a $2, 000-per-week-average-income figure.

         Our standard of review for an appeal from a child-support order is de novo on the record, but we will not reverse a finding of fact by the trial court unless it is clearly erroneous. Ward v. Doss, 361 Ark. 153, 205 S.W.3d 767 (2005). A finding is clearly erroneous when the reviewing court, on the entire evidence, is left with a definite and firm conviction that a mistake has been made. Mathews v. Mathews, 368 Ark. 252, 244 S.W.3d 660 (2006). We give due deference to the trial court's superior position to determine the credibility of the witnesses and the weight to be given their testimony. Id. In a child-support determination, the amount of child support lies within the sound discretion of the trial court, and the trial court's findings will not be reversed absent an abuse of discretion. Id. Arkansas Supreme Court Administrative Order No. 10 defines "income" for child-support purposes intentionally broadly, and this definition is intended to encompass the widest range of sources to effectuate this state's policy to adequately support children. Troutman v. Troutman, 2017 Ark. 139, 516 S.W.3d 733.

         Our de novo review of the evidence in this case supports the trial court's decision on child support. Mike agreed in his testimony that his AFM showed a gross income of $2, 000 per week in salary but that it did not reflect income he received from rentals and other businesses. He testified that in years past he had made $200, 000 annually but that his earnings dropped when they started having marital discord. Mike testified that his taxes showed $154, 000 in W-2 income and an additional $30, 000 of income, which translates into over $3, 500 per week in income before proper deductions. Mike admitted that his businesses paid for medical insurance for their daughter. Mike testified that he occasionally received bonus income but that this money typically went to debt service, not into his pocket. Mike's office manager testified about how Mike conducted his businesses, the frequency and manner in which the businesses paid for personal expenses, and whether and when Mike paid the businesses back. The office manager confirmed that the businesses had paid part of Mike's attorney's fees, provided Mike a company vehicle and fuel, and provided Mike a cell phone. Given our de novo review of this record, we cannot conclude that the trial court abused its discretion or clearly erred in finding that Mike's average weekly net income for child-support purposes was $2, 000. Moreover, the trial court provided an explanation as to why Mike was ordered to pay for tuition, bus fees, and the health, dental, and orthodontic needs of their child; the trial court recited that the difference in the income of the parties justified ordering Mike to pay those costs. We see no clear error and no abuse of discretion in the trial court's findings with regard to support of the parties' daughter.

         Mike's remaining three arguments are an attack on the trial court's division of the overall marital estate. With respect to the division of property in a divorce case, we review the trial court's findings of fact and affirm them unless they are clearly erroneous or against the preponderance of the evidence. Brown v. Brown, 373 Ark. 333, 284 S.W.3d 17 (2008). A finding is clearly erroneous when the reviewing court, on the entire evidence, is left with the definite and firm conviction that a mistake has been committed. Jones v. Jones, 2014 Ark. 96, 432 S.W.3d 36.

         Trial courts in traditional equity cases have broad powers to distribute the property in order to achieve an equitable division. Russell v. Russell, 2013 Ark. 372, 430 S.W.3d 15. The trial court is vested with a measure of flexibility in apportioning the total assets held in the marital estate upon divorce, and the critical inquiry is how the total assets are divided. See Canady v. Canady, 290 Ark. 551, 721 S.W.2d 650 (1986). The overriding purpose of the property-division statute is to enable the court to make a division that is fair and equitable under the circumstances. Id.

         Marital property cannot always be divided exactly equally and in kind. Jones, supra. Stated differently, the property-division statute does not compel mathematical precision in the distribution of property; it simply requires that marital property be distributed equitably. McCormick v. McCormick, 2012 Ark.App. 318, 416 S.W.3d 770; Coatney v. Coatney, 2010 Ark.App. 262, 377 S.W.3d 381. We will not substitute our judgment on appeal as to the exact interest each party should have but will decide only whether the order is clearly wrong. Jones, supra.

         In this case, Mike argues that the trial court clearly erred in failing to assign a value to the marital asset PSI Rentals, LLC; in declaring the home where the parties and child resided "marital" and awarding it to Bobbie Jo; and in failing to explain why it made an unequal distribution of the marital assets and debts. Bobbie Jo asserts that the trial court used its broad powers to distribute marital and nonmarital property to effect the overriding purpose of Arkansas law, which is to make a fair and equitable distribution in light of these particular facts.

         We first consider Mike's argument that the trial court was statutorily required to, but did not, establish the value of PSI Rentals, LLC (PSI). The trial court awarded the entirety of PSI, its assets and debts, to Mike. PSI was formed as a corporation by Mike during the marriage, making it a marital asset. Mike argues that because the trial court did not make a finding of fact as to the value of this asset, the trial court clearly erred in ...

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