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1995 National Legal Research Group, Inc.

INDIANA: Johnson v. Johnson, 653 N.E.2d 512 (Ind. Ct. App. 1995).

The dissolution proceeding did not survive the husband's death, and neither the competing interests of the husband's minor children nor public policy warranted deviating from the general rule against survival of divorce actions.

The couple was married in 1989. The husband, who had a child by a previous marriage, brought assets worth over $126,000 to the marriage and the wife brought assets worth $24,000. The couple had a child that same year, and in 1992 the husband filed for divorce. The dissolution hearing concluded on July 27, 1993, and the court took the case under advisement. The husband died one month later, before the court issued any final order.

The wife filed a motion to dismiss the dissolution proceedings based on the husband's death, but objections were filed by the husband's estate and the husband's child from his first marriage. The trial court denied the wife's motion to dismiss and entered a nunc pro tunc order of dissolution and division of marital property. The wife appealed, and the Indiana Court of Appeals reversed.

As a general rule, the appellate court pointed out, a trial court loses jurisdiction over a divorce action immediately upon the death of one of the principals. See "Death and Equitable Distribution," 3 Equitable Distribution J. 25 (March 1986); Annot., "Effect of Death of Party to Divorce or Annulment Suit Before Final Decree," 158 A.L.R. 1205 (1945). The court conceded that over the years the state's high court had created three narrow exceptions to this rule, but it found that each exception dealt with unique circumstances not present in this case.

For example, in State ex rel. Smith v. Delaware County Superior Court, 242 Ind. 42, 176 N.E.2d 126 (1961), the court carved out an exception to allow a surviving spouse to seek modification of a property settlement based on the deceased spouse's fraudulent underreporting of his assets to the court. Likewise, in State ex rel. Paxton v. Porter Superior Court, 467 N.E.2d 1205 (Ind. 1984), the court created yet another exception for the situation where a surviving spouse's attorney wanted to recoup fees and expenses incurred while preparing the case. And in Lizak v. Schultz, 496 N.E.2d 40 (Ind. 1986), the court allowed a deceased spouse's estate to have child support arrearages reduced to judgment following the entry of the decree of dissolution.

The husband's estate argued that the general rule is not universally honored. See Lizak v. Schultz, supra, 496 N.E.2d at 43 (observing that the general rule "seems to have been honored more in the breach"). Moreover, the estate contended that this situation presented compelling competing interests specifically, the interests of the two minor children which justified deviation from the general rule. To bolster its argument that equity called for departing from the common-law approach, the estate cited Fulton v. Fulton, 204 N.J. Super. 544, 499 A.2d 542 (Ch. Div. 1985).

In Fulton, the court had heard all the evidence in the divorce but had reserved judgment until it could conduct an inquiry into the child support issue. The husband died in the interim, but the court allowed the dissolution and distribution to proceed. The court cited the potential for injustice to the children if the wife were to receive a large portion, if not all, of the assets of the decedent based on intestacy laws.

According to the Indiana court, however, Fulton meant only that under New Jersey law some aspects of equitable distribution and related relief may survive a spouse's death before divorce in "highly unusual circumstances." Johnson v. Johnson, supra, 653 N.E.2d at 515 (quoting Carr v. Carr, 120 N.J. 336, 576 A.2d 872, 875 (1990)). Indiana statutes are different, and Indiana recognizes only three exceptions to the rule against survival of divorce actions after a spouse's death, the court added.

Turning to the estate's other contention, that the action should survive as a matter of public policy, the court held that the state legislature clearly did not intend for trial courts to retain jurisdiction over dissolution actions following the death of one of the spouses. The court conceded the estate's point that nothing in the statutory scheme specifically forecloses the resolution of property disputes between the surviving spouse and the deceased spouse's successors. Nonetheless, the court held that under Indiana law a decree of dissolution is the only vehicle available to distribute marital assets.

A property settlement is part and parcel of a final decree of dissolution, the court reasoned. Once the marriage is ended by death, there can be no final decree of dissolution. Without a final decree, there can be no property settlement. Impact of Dilatory Tactics. The husband's estate also suggested that the wife was responsible for the fact that no final order had been signed. It argued that the trial court would have been able to issue a final order before the husband's death had it not been for the wife's eleventh-hour presentation of a voluminous amount of exhibits that slowed the trial court down. But the appellate court dismissed the argument in a short footnote.

Suppose, however, that one spouse is aware of the other spouse's ill health or impending demise and does use dilatory tactics to postpone the dissolution and final decree. Would this constitute a valid exception to the general rule? In Ensman v. Ensman, 86 Mich. App. 91, 272 N.W.2d 176 (1978), the court suggested that dilatory tactics can justify deviating from the general rule of abatement. There, the husband who was well aware of the wife's terminal cancer verbally agreed to a property settlement and began to divide the marital estate with her. However, the husband did not sign the property settlement and when the wife died shortly thereafter he claimed that the court was without jurisdiction to divide the property. The Michigan Court of Appeals held that it would be inequitable to allow the husband to "drag his feet or otherwise postpone until her death a final settlement" and then claim that the entire proceeding should be abated. 272 N.W.2d at 179.

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