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.
from the Iowa District Court for Madison County, Richard B.
Agan appeals and Julianne Agan cross-appeals from various
provisions of the decree dissolving their marriage.
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,
by Danilson, C.J., Doyle, J., and Scott, S.J. [*]
DANILSON, CHIEF JUDGE
(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.
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.
Background Facts & Proceedings.
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.
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.
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.
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.
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."
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.
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.
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.
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.
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.
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. 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,
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.
(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
(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
(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.
(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
(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
(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.
(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.
(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
(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.
(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.
(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.
(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
(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
(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.
(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
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."
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
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
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.
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.
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.
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 ...