A husband who drew on marital funds instead of his post-separation salary for post-separation expenses need not reimburse the marital estate, the Court of Appeals holds, as his expenses were proper and did not constitute waste; he will pay $10,000 in monthly spousal support for four years, instead of $30,000 per month indefinitely, as wife requested.
On appeal, husband challenges the trial court decision to grant wife a reservation of a right to receive future spousal support because wife waited until a motion for reconsideration to request the reservation, rather than requesting it in her divorce complaint. Under this court’s precedent, a request for a reservation of right was implicit in wife’s request for spousal support in her complaint. Her request in her motion for reconsideration was not untimely and the order allowing a reservation of rights is affirmed.
However, this portion of the decision is reversed and the matter is remanded for the trial court to fix a time period for the reservation. Under Va. Code § 20-107.1(D) there is a rebuttable presumption that the reservation will continue for a period equal to 50 percent of the length of time between the date of marriage and date of separation, i.e., nearly 11 years in this case.
Husband also contends the trial court erred in finding his Supplemental Retirement Plan (SRP) contains marital property when and if it vests. This classification of the SRP is supported by evidence in the record on appeal on how the benefits would become payable to husband. The trial court could reasonably find the SRP at issue here contain marital value falling within the scope of Code § 20-107.3(G)(1), especially as that statute also applies to retirement benefits that have not yet vested. We disagree with husband’s contention that the SRP benefits are not only not yet vested, but also entirely unearned, until they are actually awarded by the law firm executive committee. Given testimony describing the SRP a “carrot” offered to equity partners to convince them to stay at the firm, the evidence supports a reasonable inference that SRP benefits are continually being earned by the equity partner and are eventually paid as a return for work done or services rendered.
Viewing the evidence in wife’s favor, as the prevailing party on this point, her efforts contributed to husband’s successful efforts to attain an equity partnership and then to his continuing efforts to grow his very successful real estate investment trust practice. Husband became an equity partner eight years into the marriage. The evidence supports a finding that some reasonably identifiable portion of the SRP’s value in retirement benefits was earned during the marriage.
However, the trial court erred in awarding wife 25 percent of the value of the SRP upon vesting, instead of awarding her a share of the marital portion of the SRP. On remand, the trial court shall order that if and when the SRP is received by husband, the marital share shall be determined with the numerator as the number of years husband has been an equity partner during the marriage prior to separation, and the denominator shall be the total number of years husband has been an equity partner at the time he retires and the SRP is approved by the firm.
We affirm the trial court’s decision on valuation. Wife’s expert used a method of valuation called “bottom up,” approved by this court in Howell v. Howell, 31 Va. App. 332 (2000), where it also was called the excess earnings method. The trial court said this method better isolated institutional good will, as opposed to personal good will, which was not used in calculating the ED award.
In her cross-appeal, wife argued the trial court erred when it 1) declined to use an alternate valuation date for Ameritrade and Bank of America accounts, and 2) found that husband spent significant marital funds of $1.4 million from those two accounts to pay his personal expenses and spousal support, when he had the means to pay those expenses from his post-separation earnings.
There was no abuse of discretion in the trial court’s selection of the date of the hearing, and not the separation date, for valuation. The finding of no good cause for an alternate valuation date is not plainly wrong or unsupported by the evidence.
The parties do not dispute that husband proved the marital funds were spent on proper purposes after the parties separated. We decline to hold, on the circumstances of this case, that the trial court was required as a matter of law to consider the extent of husband’s post-separation income or other separate assets in determining whether husband unfairly diminished marital assets following separation.
Finally, the trial court did not err in awarding wife monthly spousal support of $10,000 for four years, as opposed to $30,000 per month for an undefined duration, as she requested. Wife holds an MBA from the University of Virginia and was regularly employed during the early portion of the parties’ marriage. Husband’s vocational expert said wife could earn up to $85,000 per year. The trial court was permitted to find wife could successfully return to the workforce, even if she testified she intended not to do so.
Each party’s request for attorney’s fees is denied.
Wright v. Wright (Beales) No. 0947-12-2 & No. 0958-12-2, Feb. 19, 2013; Richmond Cir.Ct.; Edward D. Barnes for husband; Ronald R. Tweel for wife. VLW 013-7-048, 31 pp.t