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Unequal Property Division Reversed
© 2003 National Legal Research Group, Inc.
WISCONSIN: In re Marriage of LeMere, ___ Wis. 2d ____, 663 N.W.2d 789 (2003).
The trial court erred by awarding the husband 54% of the marital property, based upon extraordinary direct financial contributions to the operation of a successful business. The court did not give sufficient consideration to the wife's homemaker contributions.
During the marriage, the husband started his own business which became highly successful. The wife had two jobs before having children but, with the agreement of the husband, she stopped working after the birth of their second child. The husband devoted substantial time and effort to the development and growth of the company. While he drew a salary, most of the profits were retained as working capital to support the continued expansion of the company. After nearly twenty years of marriage, the parties separated and the husband filed for divorce.
At trial, the husband sought an unequal division of the business so as to reflect his industriousness in increasing its value. The trial court agreed and rendered a 65-35% split of this most valuable of the parties' assets in favor of the husband based upon the husband's efforts in making the business a success. The overall division of marital assets was 54-46% in favor of the husband. The wife appealed.
The Wisconsin Supreme Court first recognized that under the governing statutes there is a presumption in favor of an equal division of marital property, although the presumption is rebuttable. The trial court may deviate from a 50-50 division but only after considering all of the enumerated factors set forth in Wis. Stat. 767.255(3). It noted that the legislature had abandoned any dower-type formula in favor of a 50-50 presumption because of a recognition that the homemaking partner contributes services which enable the financially supporting partner to achieve his or her station in life and, in so doing, the homemaking partner has lost ground in the job market. Moreover, the presumption of equality in the division of marital assets is based upon the status of marriage as a partnership. Spouses are presumed to be equal contributors to the accumulated wealth of a marriage, regardless of whether their contributions are principally made inside or outside of the home.
The court then considered the basis for the trial court's deviation from the equal division of the business under the facts and circumstances of the case before it. It was plain that the lower court's division was based entirely upon its analysis of the parties' respective contributions to the marriage pursuant to Wis. Stat. 767.255(3)(d), the specific statutory factor regarding contribution of the parties. This, declared the court, was an error that required a reversal of the marital division granted by the trial court, as the statute mandates that all the listed factors be considered. In reaching its decision, the Wisconsin Supreme Court stated that its ruling should not be read so as to preclude a trial court from giving one statutory factor greater weight than another, or from concluding that some factors may not be relevant at all. A property division is still a discretionary decision, but the record must reflect the court's consideration of all applicable factors before a reviewing court can conclude that the proper legal standard has been applied to overcome the presumptive equal property division. The court also remarked that a trial court's failure to exercise factually inapplicable statutory factors will not be an erroneous exercise of discretion. Neither did it hold that every incomplete consideration of the statutory factors must be reversed as an erroneous exercise of discretion, as a failure to consider all the statutory factors might well be harmless, particularly where the overlooked factors are only marginally relevant or not relevant at all. But here, it was stressed that the trial court devalued the contributions of the stay-at-home mother as against the entrepreneurship of the husband expressly because she did not directly contribute to the development and expansion of the family business. While the court admitted that it was not per se impermissible to assign greater or lesser weight to spousal contributions depending on the facts in the case, it is an erroneous exercise of discretion to do so without considering the other applicable statutory factors and in a way that eviscerates the legislative purpose to place child-rearing and homemaking on an equal footing with income-earning for purposes of property division in divorce.
Finally, while the court recognized that while the total property division of 54-46% in favor of the husband did not substantially deviate from the statutory presumption of 50-50, that deviation was arrived at without considering the required statutory factors and was, therefore, an erroneous exercise of discretion that required reversal and remand for reconsideration of the property division.
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