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Smart v. Smart

Supreme Court of Delaware

April 6, 2015

MATTHEW E. SMART, [1] Petitioner Below-Appellant,
NANCY F. SMART, Respondent Below-Appellee.

Submitted: January 23, 2015

Court Below-Family Court of the State of Delaware, in and for Sussex County File No. CS12-01045 Petition No. 12-01824

Before HOLLAND, VALIHURA, and VAUGHN, Justices.


Karen L. Valihura, Justice

This 6th day of April 2015, upon consideration of the parties' briefs and the record below, it appears to the Court that:

(1) The appellant, Matthew Smart ("Husband"), filed this appeal from an order of the Family Court, dated July 9, 2014, which divided the parties' property ancillary to their divorce and awarded permanent alimony to Nancy Smart ("Wife"). Among other things, Husband argues that the Family Court abused its discretion by ordering Husband to pay $1055 per month in alimony to Wife based on its finding that Wife was only capable of earning $9000 per year. We agree. Accordingly, we reverse and remand for further proceedings.

(2) The parties were married on November 6, 1992, separated on June 15, 2011, and divorced on October 12, 2012. It was Husband's first marriage and Wife's second marriage. The parties have two children, a daughter and a son. The children were both minors at the time the parties separated, but each has since turned eighteen. Due to their respective financial circumstances and their desire to retain the marital home while their son was still in school, the parties have continued to live together in the marital home after their separation and divorce. After the parties separated in June 2011, Husband, who had been the primary wage-earner throughout the marriage, continued to pay all of the expenses associated with the home.

(3) In April 2012, Wife filed a petition for interim alimony. Wife asserted that she was an unemployed student and that her worker's compensation benefits had run out. She indicated that she was seeking full-time employment to support herself. Husband filed a response in opposition. A Family Court Commissioner held a hearing on Wife's petition. The Commissioner found that Wife was living in the marital home with the Husband and that Husband was paying all of the expenses associated with the household, including support for the parties' two children (who were both then living with them). The Commissioner noted that Husband had provided documentation showing that he had made significant payments on Wife's credit card bills and that Husband was in the midst of pursuing personal bankruptcy. The Commissioner further noted that Wife, who was working at the time of the hearing, had provided no evidence of her income or expenses. Because Husband's evidence established that the household expenses exceeded his net available income, the Commissioner denied Wife's petition for interim alimony on September 21, 2012.

(4) Thereafter, on December 12, 2012, the parties jointly filed their Rule 16(c) financial report. The report reflects that Husband was employed as an instructor at a community college earning $71, 270 per year. Wife reported working part-time in retail sales. Before her current employment, Wife had been receiving unemployment compensation of $13, 000 per year for the two preceding years. Both parties reported that they had pension plans with the State of Delaware. The parties agreed that the marital home was worth $200, 000. The parties had three vehicles and a scooter but no other marital assets to be divided.

(5) The debts listed by the parties reflected a mortgage and a home equity loan with a combined balance of nearly $200, 000. Husband requested in the Rule 16(c) report that he be credited with all payments he made on the mortgage and home equity loan after the parties separated. Husband also requested credit for marital debt that he had consolidated into a single debt in his own name and had discharged in bankruptcy. Husband also requested credit for the costs associated with filing for bankruptcy.

(6) The Family Court held a pretrial conference with the parties, who were not represented by counsel, on October 16, 2013. The hearing resulted in a letter order outlining the parties' marital assets (including both parties' pensions) and their debts (including Husband's request for equitable credit for the marital debt that he had discharged in bankruptcy).

(7) The Family Court held the ancillary hearing on April 21, 2014. Neither party was represented by counsel. Husband and Wife were the only witnesses at the hearing.[2] The parties agreed at the hearing that the marital home was worth $200, 000 but had a mortgage equal to that, leaving the parties with no equity in the home. Both parties continued to reside in the home since the date of separation, but Husband had paid the mortgage, utilities, and related household expenses. The parties indicated that they did not wish to sell the house presently because of their teenage son. After questioning by the trial judge, the parties agreed that they would share the expenses of selling the house and, when the home was eventually sold, they would split the proceeds 50/50.

(8) Wife agreed to be responsible for one-half of all of the household expenses, including the mortgage, utilities, insurance, and major and minor capital improvements, as long as she continued to reside in the home. The Family Court noted, however, that Wife did not have the current financial ability to pay her share of the expenses in light of her limited income, which the Family Court found was about $170 per week. As to debts, the Family Court noted that Husband had consolidated the parties' credit card debt shortly after the parties' separation and had had $22, 500 worth of marital debt discharged in a bankruptcy proceeding that was filed in his name alone.

(9) In its order dated July 9, 2014, the Family Court awarded Wife one-half the value of Husband's pension and deferred compensation plans but did not mention or equitably divide Wife's pension. The Family Court noted the parties' agreement as to the division of their vehicles. The court also noted the parties' agreement to a 50/50 division of the proceeds from the sale of the marital home once the parties sell it, as well as the parties' agreement to share equally the expenses related to the home so long as Wife remained living there. The Family Court ordered that Husband be reimbursed at the time of settlement for any major capital improvements to home if Wife did not pay ...

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