Childers v. Childers

Supreme Court of Oklahoma · Family Law

Family Lawproperty divisionvaluation of marital estateattorney feesdivorcemarital estatevaluationaccrual accounting

Facts

The parties were married in 1996 and during the marriage developed numerous businesses, mostly tied to the wife's medical practice, which the husband managed from home. After the wife filed for divorce, a receiver was appointed to manage the businesses and he prepared profit and loss statements and asset-liability information using accrual-basis accounting, along with appraisals of certain real property and airplanes. At trial, the receiver, the husband, and the wife testified; the husband did not object to the receiver's valuation evidence and offered no valuation evidence beyond his own statements. The trial court awarded the wife assets with equity of $519,020, the husband assets with equity of $177,942, and the husband $150,000 in alimony in lieu of property, while ordering each party to pay his or her own attorney fees.

Issue

Whether the trial court's valuation of the marital estate using the receiver's accrual-basis accounting evidence was against the clear weight of the evidence, whether the resulting property division was just and reasonable, and whether ordering each party to pay his or her own attorney fees was an abuse of discretion.

Rule

A trial court's valuation of marital assets in a divorce will not be disturbed unless it is against the clear weight of the evidence, and the court may select among several acceptable valuation methods based on the evidence presented. Jointly acquired property must be divided in a manner that is just and reasonable, meaning equitable rather than necessarily equal, and this may be accomplished by an in-kind division or by awarding property to one spouse and compensation to the other. In deciding attorney fees, the trial court may award reasonable expenses as are just and proper under the circumstances, guided by a judicial balancing of the equities and the means and property of each party, and its decision is reviewed for abuse of discretion.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In a divorce trial in Oklahoma City, Dana Mercer and Elias Mercer dispute the value of three jointly owned clinics. A court-appointed accountant with years of experience managing distressed businesses testifies from accrual-basis profit-and-loss statements and balance sheets, and Elias offers no expert valuation of his own.

On appeal, Elias argues the decree must be reversed because the court did not determine the clinics' fair market value using a different methodology. What is the best answer?

Explanation. The majority held that a trial court's valuation of marital assets will not be disturbed unless against the clear weight of the evidence. It also emphasized that the court may select among several acceptable valuation methods based on the evidence presented. Where a credible accountant supplied accrual-basis financial information and the challenging spouse offered no competing valuation evidence, affirmance is proper. (Derived from Childers v. Childers (n.d.).)