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McCarty v. McCarty

Nebraska Court of Appeals · 2024 · Civil Procedure

Civil ProcedureDissolution of marriageMarital property divisionmarital estatenonmarital propertyretirement accountspremarital homevehicle classification

Facts

The parties married in 2014, separated in 2017, and had a short marriage of about 3 years. Brenda brought into the marriage a home, a Chevy Tahoe, and two retirement accounts, and during the marriage the parties also acquired a Hyundai Tucson that was heavily encumbered. The district court found neither party credible and relied on limited documentary evidence, concluding that the home had no equity for equalization purposes, the Tahoe was premarital, and Brenda should receive both retirement accounts. After separation, Crystal surrendered the Tucson to the creditor, Brenda redeemed it, and Brenda remained solely liable on the loan, which exceeded the vehicle’s value.

Issue

Did the district court abuse its discretion in classifying and distributing the marital estate by awarding Brenda the retirement accounts, marital residence, Chevy Tahoe, and Hyundai Tucson, and in denying Parsons attorney fees? More specifically, was the overall property division inequitable under Nebraska dissolution law?

Rule

In a dissolution action, property division is reviewed de novo on the record for abuse of discretion. Nebraska follows a three-step process: classify property as marital or nonmarital, value marital assets and liabilities, and equitably divide the net marital estate. Generally, property accumulated during marriage is marital, but the party claiming property or debt is nonmarital bears the burden of proof. Retirement benefits earned during the marriage are part of the marital estate, but a court may still award the full value of a marital asset to one spouse if the overall division is fair and reasonable under the circumstances; there is no strict mathematical formula, though one-third to one-half is only a general guideline.

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

Maya Ellis and Tessa Boone were married in Omaha for 2 years and had no children. Before the marriage, Maya already had a union pension and a contribution-based retirement account; records show the contribution-based account grew by $9,000 during the marriage, but the trial court awarded both accounts entirely to Maya after finding Maya earned far more than Tessa and was 25 years closer to retirement age than Tessa.

If Tessa argues the decree must be reversed because she received none of the retirement accounts despite a marital component in one account, what is the best answer?

Explanation. The governing principle is that retirement benefits earned during the marriage are part of the marital estate, but the court is not required to divide each asset itself. The polestar is fairness and reasonableness in the overall distribution, and the one-third to one-half range is only a general guide, not a mandatory formula. In a short marriage with substantially greater financial contributions by one spouse and circumstances such as proximity to retirement, awarding the full retirement accounts to that spouse may still be within the trial court’s discretion. (Derived from McCarty v. McCarty (n.d.).)