Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

In re Marriage of Agan

Court of Appeals of Iowa

November 7, 2018

IN RE THE MARRIAGE OF STEPHEN D. AGAN AND JULIANNE M. AGAN Upon the Petition of STEPHEN D. AGAN, Petitioner-Appellant/Cross-Appellee, And Concerning JULIANNE M. AGAN, Respondent-Appellee/Cross-Appellant.

          Appeal from the Iowa District Court for Madison County, Richard B. Clogg, Judge.

         Stephen Agan appeals and Julianne Agan cross-appeals from various provisions of the decree dissolving their marriage.

          Ryan D. Babich and Phillip F. Van Liew of Babich Goldman, PC, Des Moines, for appellant.

          Elisabeth S. Reynoldson of Reynoldson & Van Werden, LLP, Osceola, and Jane E. Rosien of Flander Rosien, PC, Winterset, for appellee.

          Heard by Danilson, C.J., Doyle, J., and Scott, S.J. [*]

          DANILSON, CHIEF JUDGE

         Stephen (Steve) Agan appeals and Julianne (Juli) Agan cross-appeals from various provisions of the decree dissolving their marriage. Steve argues the dissolution court inequitably valued and divided the marital property. Juli argues the court erred in valuing the pastureland. Neither party challenges the distribution of property, rather both raise various issues to support their contention that the equalization award was inequitable. Steve also requests appellate attorney fees.

         Upon our de novo review of the decree, we modify the dissolution decree to account for various gifted monies and conclude the equalization payment to Juli from Steve shall be in the amount of $80, 000. We do not award appellate attorney fees.

         I. Background Facts & Proceedings.

         Steve and Juli began living together in February 2009, and were married on February 27, 2010. On March 3, 2015, Steve filed a petition for dissolution of marriage. In June 2015, Juli moved out of the home where the parties had resided together. The trial was held on November 16-17, 2016, and the decree was filed on February 27, 2017.

         Steve works as a heavy equipment operator with Elder Corporation. Juli works at Wells Fargo. Steve receives unemployment compensation during his company's annual layoff. In addition to his job, Steve raises cattle and serves as manager of his family's trust, the Raymond John Agan Trust. As compensation for his work as manager, Steve is permitted to live in the home owned by the Trust and to use the adjoining farm buildings and graze the 100 acres of adjoining pasture land. He is not required to pay any rent for the house, buildings, or pasture land.

         Steve's grandfather gave him five cows in 2000 and fifteen cows in 2001. Steve purchased a bull before he and Juli were married. At the time of the parties' 2010 marriage, Steve owned twenty-five cows, one bull, and ten to thirteen calves. One cow and two bulls were purchased during the marriage. Juli took time off work to assist the veterinarian in working the herd. She was involved in the calving season, contacting the veterinarian when needed, pulling calves, and bottle feeding. Both Juli and Steve were involved in the bookkeeping necessitated by the cattle operation.

         During their marriage, Steve and Juli combined their bank accounts. They both deposited their paychecks into a joint account at Farmer and Merchants State Bank, which was used both as their personal account and as the farm account to fund the cattle operation. Juli also deposited the child support she received for her two children from a prior marriage into this account. The parties also had joint checking and savings accounts at Union State Bank.

         In March 2012, Steve and Juli purchased 36.74 acres of pasture in Madison County. The funds for the purchase of the real estate ($89, 058) came from Steve's mother, Mildred Jo Agan ("Jo"). The instrument of conveyance executed when the real estate was purchased vested title in Steve and Juli as "Joint Tenants with Full Rights of Survivorship and Not as Tenants in Common."

         During the marriage, Steve and Juli paid for and made substantial improvements to the pasture land, reconstructing the pond on the land, installing a fence around the pond, installing an additional stretch of fence, installing tile and waterers, building a small corral, and building a crossing. All of these improvements were paid for out of the parties' joint bank account at Farmers and Merchants State Bank. Until late 2014 when the parties separated, their bank accounts, real estate taxes, insurance premiums, and all other expenses related to the real estate were paid out of the parties' joint Farmers bank account.

         Since June 2015, Steve has retained sole and exclusive possession of the real estate without regard to Juli's ownership interest. He received and retained all benefit, enjoyment and income generated from the real estate. Juli received no compensation or consideration in any form or amount.

         By 2015, the cattle herd had grown to sixty-five cows. Steve sells his calves each year. After filing for divorce, Steve sold nine cows, one bull, and thirty-nine calves. He did not deposit the proceeds from these sales into any bank account, he retained over $38, 000 cash.

         On the date of trial-November 16, 2016-Steve was forty-five and Juli was forty-six years old, and both parties were in good health. They have no children together; Steve has no children and Juli has two children from a prior marriage. Steve's gross year-to-date income was $42, 423, and he anticipated making another $1000 from Elder Corporation and about $6000 in unemployment compensation for the year. In addition, he benefits from the free rent and free use of buildings and pasture for supervising the properties owned by the trust. Juli's annual income was about $52, 000.

         At trial, Steve claimed the livestock were offspring from his premarital gifted livestock, with the exception of one cow and two bulls. He sought to have all but the one cow and two bulls set aside as gifted property. He also asserted that the $89, 058 his mother provided to purchase the thirty-six acres of farmland as pasture was a gift to him alone. Further, Steve contended in August 2012, his mother gifted to him alone $15, 150 to purchase a hay rake and hay mower; on July 9, 2013, $16, 660 to purchase a hay processer; and in July and August 2013, $11, 000 to purchase a Kawasaki all-terrain vehicle (ATV) side-by-side. Steve's father also gifted him a boat in 2012 and a 1998 Dodge Dakota in 2013. Steve testified as to his estimate of the value of farm machinery, vehicles, and other property. He also testified the value of the pasture land was $2900 per acre.

         Juli testified she had performed computer research of various sites she and Steve had used to purchase the various pieces of farm machinery, and she presented estimates from those websites as to the current value of the farm machinery and other items.[1] She also testified she had researched the sales of comparable properties to the pasture land purchased in 2012. She opined the value was $3800 per acre or $139, 600.

         Following trial, the district court made findings as to the value of contested property. The court found, "A fair and reasonable current fair market value of Steve and Juli's pasture land is $3200.00 to $3600.00 per acre for a total value of $125, 000.00." The court also concluded the parties' assets included these items and determined their fair market values.[2]

(a) Kuhn GMD 3550 Mower Conditioner (Serial #B0070) was purchased in approximately December 2011. Virtually the same piece of equipment, Kuhn GMD Mower Conditioner (Serial #B0098), is for sale in Albia, Iowa for $12, 900.00. The fair and reasonable value of the parties' mower conditioner is $8500.00.[3]
(b) Kuhn SR110 Hay Rake (Serial #E3929) was purchased in approximately December 2011. A similar but slightly older piece of equipment (Serial #E3571) is for sale in Waukon, Iowa for $4995.00. The rake for sale in Waukon is Serial #3571, produced approximately 400 units before production of E3929. The parties' hay rake has a kicker wheel, the one listed for sale does not, which increases value. The fair and reasonable value of the parties' hay rake is $3750.00.[4]
(c) Kewanee 1010 18' Disk was purchased in approximately June 2012. A similar piece of equipment is for sale in Ellsworth, Wisconsin for $4495.00. The fair and reasonable value of the parties' disk is $2200.00.
(d) Demco 500 gallon sprayer was purchased in approximately June 2012. S&H Farm Supply in Lockwood, Iowa, recently sold a similar sprayer for $500.00. The fair and reasonable value of the parties' sprayer is $500.00.[5]
(e) 2011 Kawasaki Mule 610 4x4 XC was purchased in approximately January 2011. A similar Mule, but without a roof and without a bumper/cattle guard, is listed for sale in Peninsula, Ohio, for $5998. A Kelley Blue Book valuation of a 2011 Kawasaki Mule 610 4x4 XC, also without a roof and bumper/cattle guard, is valued at $5245. The fair and reasonable value of the parties' Mule is $4250.00.[6]
(f) 2015 John Deere X534 Lawn Tractor (Serial #xxxFM101067) was purchased in March 2016. The parties' 2012 John Deere X534 Lawn Tractor, both purchased and paid for in full during the marriage, was traded in against the purchase of the 2015 Lawn Tractor. A trade allowance was given of $4200.00 for the 2012 Lawn Tractor. The parties' 2015 Lawn Tractor has only 40 hours of use, a 54" deck and a rack/cattle guard on the front. A 2015 John Deere X534 with only a 40" deck, 60 hours of use and no rack/cattle guard is for sale in Dubuque, Iowa for $6100. A 2015 X534 with a 54" deck and 86 hours of use, but no rack/cattle guard on the front, is for sale in Sleepy Eye, Minnesota for $6250.00. A fair and reasonable value of the parties' 2015 Lawn Tractor is $5300.00.[7]
(g)1975 John Deere 4430 Tractor with Cab was purchased in January 2012. A slightly newer 1977 John Deere 4430 Tractor with Cab is for sale in Jordan, Minnesota for $12, 900.00. A fair and reasonable value of the parties' 1975 John Deere 4430 is $9000.00.[8]
(h) 2013 12' Big Dog Feed Lot Box Scraper (Serial #H2120912800) was purchased in March 2013. The parties' scraper is in remarkably good or excellent condition. Two other 2013 12' Big Dog Feed Lot Box Scrapers are for sale in Iowa. One in Chariton; and, one in Manchester. Both are listed for sale for $4700.00. A fair and reasonable value of the parties' Big Dog Scraper is $3600.00.[9]
(i) 2013 727TK Grasshopper Mower with Powerfold Duramax 61" Deck (Serial #6314103) was purchased in March 2013. A 2001 720K/61 Grasshopper Mower owned by Steve prior to the marriage was traded in against the purchase of the 2013 Mower. A trade allowance was given of $2630.00 for this 2001 Grasshopper Mower. The parties' 2013 Grasshopper has approximately 140 hours of use. A 2013 Grasshopper 727T, without the Kohler cooled engine and with 244 hours of use is for sale in Sleepy Eye, Minnesota for $9650.00. A fair and reasonable value of the parties' 2013 Grasshopper 72TTK is $7500.00.[10]
(j) 2013 Highline CFR650 Bale Processor (Serial #CFR6505413) was purchased in July 2013. The same model but slightly older unit (Serial #CFR650402) is for sale in Osceola, Iowa for $17, 500.00. The same model sold in Moorhead, Minnesota in April 2016 for $15, 100.00. A fair and reasonable value of the parties' bale processor is $10, 000.00.[11]
(k) 2012 Kawasaki Teryx KRF750NCS was purchased in August 2013. It has a roof, 1723 miles and 360 hours of use. A 2013 Kawasaki Teryx without a roof is for sale in Pound, Wisconsin for $6900.00. A fair and reasonable value of the parties' Teryx is $3800.00.[12]
(l) 2015 Suzuki King Quad 750 AXI was purchased in October 28, 2015. It has 15 miles and 3.4 hours of use, upgraded tires, upgraded wheels, a front rack and a back rack. A Kelley Blue Book valuation of a 2015 Suzuki King Quad, without any upward adjustment for the upgrades and accessories, is $7260.00. A fair and reasonable value of the parties' King Quad is $5200.00.[13]
(m) 2015 Wilson Ranch Hand 24' Aluminum Trailer (Serial #PSGN-5724T) was purchased in April 2015. A 2011 model of this trailer with only one center gate is for sale in Harrisburg, South Dakota for $14, 500.00. The parties' trailer has two center gates and is in very good condition. The 2011 model decreased in value $666.00 per year. A fair and reasonable value of the parties' Wilson Trailer is $14, 800.00.[14]
(n) 2014 Ranchworx Aerator (Serial #56890314130RHA) was purchased in April 2014. This is a unique aerator. Comparable listings or sales are difficult to find. According to the manufacturer a comparable 2016 model would cost $22, 700.00. A two-year-old model would decrease in value. A fair and reasonable value of the parties' aerator is $8000.00.[15]
(o) 259DS Caterpillar Multi Terrain Loader (Serial #FTL08580) was purchased in May 20, 2016. Two 259D Caterpillar Multi Terrain Loaders, one with 159 hours of use and one with 133 hours of use, are for sale on CatUsed.com for $56, 500.00. Ziegler, Inc., the CAT dealership where the parties' loader was purchased, values it between $55, 000.00 and $60, 000.00. A fair and reasonable value of the parties' loader is $53, 000.00.[16]
(p) Feeders, hay rings, waterers, portable fencing and miscellaneous hand tools and power tools were also purchased throughout the marriage. Steve and Juli, and now Steve individually, insure feeders for $5000.00, portable fencing for $8000.00 and miscellaneous hand tools and power tools for $13, 450.00. The parties' income tax return depreciation schedules for the period of the marriage show the purchase of waterers totaling $1774.00; and, feeders totaling $680.00. Additionally, during 2015 Steve purchased a feeder for $2521.62 which was omitted from his 2015 depreciation schedule. Discounting these amount for items purchased prior to the marriage and for depreciation in value, a fair and reasonable fair market value of these items is $1000.00 for feeders, hay rings and waterers; $2000.00 for portable fencing; and, $1000.00 for miscellaneous hand and power tools.

         In the February 27, 2017 dissolution decree, the district court characterized Steve's claims that the pastureland and farm machinery were gifts to him as an effort to "effectively deprive Juli of any interest or equitable consideration from those assets." The court did find there was credible evidence that monies were gifted to provide for the purchase of the pastureland. However, the court also determined, "Even so, it is not clear those monies were gifted only to Steve and, even if they were, the gift has been sufficiently commingled to render it property subject to division in these proceedings."

         The court also rejected Steve's claim that items were either in disrepair or damaged, decreasing their value. The court found no credible evidence supported reducing the fair market value of the 1975 John Deere 4430 Tractor, the 2012 Kawasaki Teryx, the 2015 Suzuki King Quad, or the 2014 Ranchworx Aerator.

         The court also rejected Steve's claim that the monies used to purchase the 2012 Kawasaki Teryx, Kuhn SR110 Hay Rake, Kuhn GMD 3550 Mower Conditioner, and 2013 Highline CFR650 Bale Processor were from his mother and given exclusively to him. The court found:

Steve and Juli's joint bank account records show cash deposits at or about the time of these items being purchased. Unlike the records admitted regarding the real estate purchase funded by Jo, there are no accompanying records of these cash deposits coming from Steve's mother. Steve testified that he did not like to have a lot of money in the bank and intentionally keeps large amounts of cash on hand at home. Juli corroborated this. It cannot be verified that the cash deposits made at or about the time these items were purchased were monies provided by Jo Agan, and not just cash Steve had on hand and deposited. Again, no gift tax returns were filed verifying the amounts of the gifts and/or the gift donee(s).
Regardless, the monies were deposited into the joint checking account maintained by Steve and Juli at Farmers and Merchants State Bank. Steve and Juli together researched, shopped for and went to purchase these items. The insurance premiums for these items were paid out of the parties' joint account for so long as it existed. The cost of repair, service and maintenance for these items was paid out of the parties' joint account for so long as it existed. The items were used in the parties' joint cattle operation and were claimed as assets on the depreciation schedule filed with their joint income tax returns.

         As for the cattle, the court determined that even if Steve's original cows were gifted to him,

[f]rom the moment the parties were married the cattle operation was funded through the parties' joint checking account, the same account into which Juli deposited all of her paychecks and all of her child support payments. Promptly after their marriage, Steve and Juli set into motion a very intentional plan to grow the cattle herd. The real estate was acquired and substantially improved with joint monies as described above to allow for the growth of the cattle herd. Bulls were purchased. Calves were held back, fed, cared for and bred. Juli was an active participant in these decisions and in the care of the herd. Feed, hay, feeders and waterers were purchased with monies from the parties' joint bank account. Veterinarian bills were paid from the parties' joint bank account. Machinery and equipment used in the cattle operation was purchased, serviced, maintained and insured with monies from the parties' joint bank account. It is unlikely that many, if not all, of Steve's original 25 head of cows are even still part of the herd. Under these circumstances, it would be inequitable to set aside 25 head of cows as Steve's separate property.

         With respect to Steve's claim that the 2011 Kawasaki Mule should not be considered marital property because it had been given to his mother and was kept at his mother's residence, the court found:

Steve and Juli purchased and paid for the 2011 Mule during the marriage. Steve continued to list the 2011 Mule on his bank financial statements after August 2013. The 2011 Mule remained a listed asset on Steve and Juli's income tax return depreciation schedules for all years since 2011, including on Steve's individual return for tax year 2015. The 2011 Mule remained a listed item on Steve and Juli's insurance coverage, including on the individual policy Steve acquired in January 2016. While it is undisputed that Steve's mother has been allowed to use the Mule and it has remained at her residence, its actual ownership has not been transferred. It remains an asset of the parties for purposes of these proceedings.

         The district court did set aside some items to Steve as gifted property, i.e., a 1997 Buick LeSabre, a 1980 Chevrolet pickup, and a boat. The court divided the marital property and debts, awarded Juli fifty percent of Steve's pension fund accrued during the parties' marriage, assigned vehicles to each party, awarded Steve the cows, the pastureland, and the farm machinery, and ordered Steve to pay Juli an equalization ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.