                                                                               FILED
                                                                           Mar 18 2019, 8:58 am

                                                                               CLERK
                                                                           Indiana Supreme Court
                                                                              Court of Appeals
                                                                                and Tax Court




      ATTORNEYS FOR APPELLANT                                   ATTORNEYS FOR APPELLEE
      Marvin Mitchell                                           Brian K. Zoeller
      Richard J. Dick                                           Julie Andrews
      Mitchell Dick McNelis, LLC                                Casandra L. Ringlespaugh
      Indianapolis, Indiana                                     Nicole Makris
                                                                Cohen & Malad, LLP
                                                                Indianapolis, Indiana


                                                  IN THE
          COURT OF APPEALS OF INDIANA

      Dina Hasten Cohen,                                        March 18, 2019
      Appellant-Respondent,                                     Court of Appeals Case No.
                                                                18A-DR-2139
              v.                                                Appeal from the Marion Superior
                                                                Court
      Itamar Cohen,                                             The Honorable Timothy W.
      Appellee-Petitioner.                                      Oakes, Judge
                                                                Trial Court Cause No.
                                                                49D02-1612-DR-44346



      Mathias, Judge.


[1]   Dina Hasten Cohen (“Wife”) appeals the order of the Marion Superior Court

      dissolving her marriage to Itamar Cohen (“Husband”) and distributing the

      assets of the marital estate between them. The trial court ordered Husband to

      pay Wife an equalization payment of $922,275.10, to be paid at the rate of


      Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019                           Page 1 of 12
      $6,000 per month for seventy-two months, with an additional balloon payment

      of $490,250.10 within six years. The trial court further ordered that no interest

      be paid so long as Husband made timely payments, but that interest would

      accrue if Husband missed any payments. Wife appeals and argues that the trial

      court legally erred by failing to include a provision for the payment of interest in

      its decree.

[2]   We affirm.


                                  Facts and Procedural History
[3]   As Wife has failed to provide us with a transcript of the proceedings below, we

      derive our statement of the facts from the trial court’s dissolution decree.

      Husband and Wife were married in March 1999. The marriage produced four

      children, who at the time of the dissolution decree were aged eighteen, thirteen,

      ten, and three.

[4]   On December 19, 2016, Husband filed a petition for dissolution of his marriage

      to Wife. Fortunately, all issues relating to the children were resolved by the

      parties’ Settlement Agreement as to Custody, Parenting Time, Child Support,

      and Child Related Matters, which the trial court approved on December 6,

      2017. The parties disagreed, however, on how to distribute the assets of the

      marital estate. Accordingly, on March 7 and 8, 2018, the trial court held an

      evidentiary hearing on this issue. On August 8, 2018, the trial court entered its

      dissolution decree, awarding to Husband several income-producing commercial

      properties and awarding the marital residence to Wife. The income-producing

      Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019        Page 2 of 12
      properties represented a substantial portion of the marital estate. Therefore, the

      trial court ordered Husband to pay to Wife an equalization payment as follows:

              The balance of the above leaves the Husband with a net of
              $2,070,180.40 and Wife $225,630.21, for difference of
              $1,844,550.20. Therefore, the Court seeing no reason to deviate
              from the statutory presumptive of a 50/50 asset split DECREES
              the Wife shall be awarded a judgment against Husband in the
              amount of $922,275.10 to be repaid at a rate of $6,000 per month
              for seventy-two (72) months, along with a balloon payment of
              $490,275.10 []on or before the end of the six (6) years. So long as
              all payments are made by the 1st of each month no interest shall
              accrue on those payments, but if any payments are missed the
              judgment begins accruing statutory interest.


      Appellant’s App. p. 22. Wife now appeals.


                                          Standard of Review
[5]   A trial court must divide the property of the parties to a marital dissolution in a

      just and reasonable manner. Webb v. Schleutker, 891 N.E.2d 1144, 1153 (Ind. Ct.

      App. 2008) (citing Ind. Code § 31-15-7-4(a)). An equal division of marital

      property is presumed to be just and reasonable. Id. (citing Ind. Code § 31-15-7-

      5). Decisions concerning the division and distribution of marital assets lie

      within the sound discretion of the trial court. Fischer v. Fischer, 68 N.E.3d 603,

      608 (Ind. Ct. App. 2017), trans. denied (citing Keown v. Keown, 883 N.E.2d 865,

      868 (Ind. Ct. App. 2008)). On appeal, we review the trial court’s decision only

      for an abuse of that discretion. Id. A trial court abuses its discretion only when

      its decision is clearly against the logic and effect of the facts and circumstances

      before the court. Id. When we review a challenge to the trial court’s division of
      Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019         Page 3 of 12
      marital assets, we consider only the evidence most favorable to the trial court’s

      disposition, and we will neither reweigh the evidence nor assess the credibility

      of witnesses. Id.


                                       Discussion and Decision
[6]   Wife argues on appeal that the trial court erred by ordering Husband to pay her

      an equalization payment over a period of six year without including an award

      of interest unless Husband fails to timely make a payment. Wife argues that by

      failing to include a provision for interest, the trial court’s order fails to take into

      consideration the time value of money, the risk of non-payment, and inflation.

      Wife contends that, when taking these factors into consideration, the total

      amount of future payments is not equal to the present value of those payments.

[7]   It has long been held that the question of “whether a lump sum award payable

      in installments will bear interest rests within the sound discretion of the trial

      court.” In re Marriage of Merrill, 455 N.E.2d 1176, 1177 (Ind. Ct. App. 1983)

      (citing Van Riper v. Keim, 437 N.E.2d 130, 131–132 (Ind. Ct. App. 1982)).

      Indeed, as noted in Van Riper, our supreme court held over one hundred years

      ago that “a decree awarding deferred payments of alimony in gross[1] is satisfied

      by timely payment of the installments, without interest, unless interest is




      1
        “Alimony in gross” means a certain sum, payable in one or more installments, and is generally considered
      to be a division of property. Van Riper, 437 N.E.2d 130, 132 n.1 (citing Hicks v. Fielman, 421 N.E.2d 716, 721
      (Ind. Ct. App. 1981)). Alimony in gross is thus distinct from periodic alimony, which consists of payments of
      support, subject to modification or termination. Id.

      Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019                                Page 4 of 12
      required by the decree.” Id. (citing Winemiller v. Winemiller, 114 Ind. 540, 17

      N.E. 123, 124 (1888)). We presume on appeal that that “trial courts are aware

      of the time value of money and take it into consideration when dividing

      property and deciding whether interest should be awarded.” Merrill, 455 N.E.2d

      at 1177–78.


[8]   Wife acknowledges that an award of interest is discretionary, but she argues

      that the trial court’s failure to award interest effectively awards her a share of

      the marital estate less than the one-half that the trial court found just and

      reasonable. That is, she contends that, if a trial court declines to award interest

      when payments are time delayed, then the trial court has not truly awarded an

      equal share.

[9]   Wife’s argument is based on the time value of money. Simply put, the time

      value of money recognizes the economic reality that a given sum of money

      today is worth more than the same amount in the future.2 Interest represents the

      time value of money. Indianapolis Pub. Hous. Agency v. Aegean Const. Servs., Inc.,

      755 N.E.2d 237, 241 (Ind. Ct. App. 2001) (citing Reese v. Reese, 696 N.E.2d 460,



      2
          One source summarizes the time value of money as follows:
                 Time value of money . . . is the idea that money that is available at the present time is
                 worth more than the same amount in the future, due to its potential earning capacity.
                 This core principle of finance holds that provided money can earn interest, any amount
                 of money is worth more the sooner it is received. One of the most fundamental concepts
                 in finance is that money has a time value attached to it. In simpler terms, it would be
                 safe to say that a dollar was worth more yesterday than today and a dollar today is
                 worth more than a dollar tomorrow.
      “What is the Time Value of Money,” Money Counts: A Penn State Financial Literacy Series, available at:
      https://psu.instructure.com/courses/1806581/pages/introduction-what-is-time-value-of-money.

      Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019                                       Page 5 of 12
       463 (Ind. Ct. App. 1998), trans. denied). If there is no provision for interest, the

       value of a promise to pay money in the future can be determined using a

       discount rate. See Interest Rate, Black’s Law Dictionary (10th ed. 2014) (defining

       “discount rate” as “the interest rate used in calculating present value.”).

[10]   In the present case, using the 8% statutory interest rate as our discount rate, the

       present value of the $490,275.10 balloon payment that is due in six years is

       $308,956.48. And the present value of seventy-two monthly payments of $6,000

       is not the future value of $432,000, but $342,207.13. Thus, Wife argues that she

       has, in reality, been awarded only $651,163.61, not the $922,275.10 stated by

       the trial court. In raw mathematical terms, Wife’s argument has some appeal.


[11]   Indeed, our courts have acknowledged the time value of money in dissolution

       cases. For example, in Burkhart v. Burkhart, 169 Ind. App. 588, 594, 349 N.E.2d

       707, 711 (1976), the husband was ordered to pay the wife various payments

       over time as part of the distribution of assets. The husband appealed and, using

       the total value of all future payments, argued that the wife received over 69% of

       the marital assets. Id. We rejected this claim, holding that “[t]he more proper

       way to determine the value of the assets transferred to the Wife is to consider

       the present value of the given annuity, not the total of all future payments.” Id.

       at 593, 349 N.E.2d at 711. Using a six-percent discount rate to calculate the

       present value of the payments to the wife, the court concluded that she was in

       fact awarded only 41% of the marital estate. Id. at 594, 349 N.E.2d at 712.




       Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019          Page 6 of 12
[12]   Subsequent cases followed the Burkhart holding. See Whaley v. Whaley, 436

       N.E.2d 816, 820–21 (Ind. Ct. App. 1982) (holding that trial court should have

       discounted to its present value a $137,200 judgment in favor of wife payable

       over a period of 120 months without interest); Wilson v. Wilson, 409 N.E.2d

       1169, 1175 (Ind. Ct. App. 1980) (holding that trial court failed to properly take

       time value of money into account when it awarded wife judgment of $60,500,

       payable in monthly installments of $500 over 121 months and concluding that,

       on remand, trial court should discount the payments to their present value); see

       also In re Marriage of Davis, 182 Ind. App. 342, 349, 395 N.E.2d 1254, 1259 n.2

       (1979) (noting that trial court discounted $100,000 cash award to wife to its

       present value pursuant to Burkhart holding).


[13]   Indiana courts have also acknowledged the time value of money in cases

       outside the context of the distribution of marital assets. See Christopher R. Brown,

       D.D.S., Inc. v. Decatur Cty. Mem’l Hosp., 892 N.E.2d 642, 646 (Ind. 2008) (noting

       that Indiana has long recognized the time value of money and has

       acknowledged that, in order to achieve full compensation for the loss of use of

       property, a claimant has the right to be paid pre-judgment interest on sums

       owed that are belatedly paid); Gregory & Appel Ins. Agency v. Philadelphia Indem.

       Ins. Co., 835 N.E.2d 1053, 1063 (Ind. Ct. App. 2005) (noting that the purpose of

       the pre-judgment interest statute is to encourage settlement and to compensate

       the plaintiff for the lost time value of money), trans. denied; In re Paternity of

       A.D.W., 693 N.E.2d 576, 580 (Ind. Ct. App. 1998) (recognizing the time value

       of money by noting that the present value of $10.00 weekly installments was

       Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019            Page 7 of 12
       substantially less than arrearage of $11,774); Griffin v. Acker, 659 N.E.2d 659,

       663 (Ind. Ct. App. 1995) (agreeing with the general statement that present value

       is a proper consideration in the determination of an appropriate award but

       holding that this court will not presume to dictate a proper discount rate for

       present value purposes), trans. denied.


[14]   All of this would seem to favor Wife’s argument that the trial court should have

       included a provision for interest in its equalization payment schedule, or if not,

       award her a greater share of the marital estate to reflect the present value of the

       future money. Were we writing on a clean slate, we might be inclined to agree

       with Mother’s economic and policy arguments. But we consider ourselves

       bound by our supreme court’s holding in Rovai v. Rovai, 912 N.E.2d 374 (Ind.

       2009).

[15]   In Rovai, the trial court’s dissolution decree provided that the marital assets,

       which totaled $121,893, were to be distributed equally, with both parties

       receiving $60,946.50. The trial court also awarded the parties their respective

       retirement accounts, but awarded the marital residence to the wife. After

       distributing the marital debts, the trial court ordered the wife to make an

       equalization payment in the amount of $36,090.57. The trial court reduced this

       amount to a judgment and ordered the wife pay this amount to the husband

       when any of the following occurred: “(1) both children become emancipated;

       (2) [the wife] voluntarily sells the marital home; or (3) [the wife] cohabits with

       someone else in the marital home.” Id. at 375. The trial court explicitly stated

       that “‘this amount is reduced to judgment without interest.’” Id. (emphasis in

       Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019         Page 8 of 12
       original) (record citation omitted). The children were aged six and thirteen at

       the time of the decree. Id. Thus, the payment could have been due as late as

       twelve years from the date of the order.


[16]   On appeal, a panel of this court affirmed but acknowledged that there was some

       conflict in our precedents on the matter. Rovai v. Rovai, 891 N.E.2d 177, 180

       (Ind. Ct. App. 2008), trans. granted. On transfer to our supreme court, the

       husband argued that he was entitled to post-judgment interest as a matter of law

       under Indiana Code section 24-4.6-1-101, which generally provides for post-

       judgment interest in civil cases.3 The wife argued that an award of interest in

       dissolution cases was within the discretion of the trial court and that the trial

       court’s decision not to award interest was made pursuant to Indiana Code

       section 31-15-7-4(b)(2), which provides that the court “shall divide the property

       in a just and reasonable manner by . . . setting the property or parts of the

       property over to one (1) of the spouses and requiring either spouse to pay an

       amount, either in gross or in installments, that is just and proper.”




       3
           This statue provides:
                  Except as otherwise provided by statute, interest on judgments for money whenever
                  rendered shall be from the date of the return of the verdict or finding of the court until
                  satisfaction at:
                    (1) the rate agreed upon in the original contract sued upon, which shall not exceed an
                    annual rate of eight percent (8%) even though a higher rate of interest may properly
                    have been charged according to the contract prior to judgment; or
                    (2) an annual rate of eight percent (8%) if there was no contract by the parties.
       I.C. § 24-4.6-1-101.

       Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019                                      Page 9 of 12
[17]   Our supreme court framed the question before it as:


               whether the statute directing interest on money judgments
               compels post-judgment interest be paid whenever money changes
               hands pursuant to a dissolution decree, or whether the
               dissolution statutes grant a court discretion to impose interest, or
               not, in the course of fashioning what the latter calls a “just and
               reasonable” division of property.


       Rovai, 912 N.E.2d at 376 (quoting I.C. § 31-15-7-4). The court answered this

       question as follows:

               In the law’s historic divide between law and equity, there may be
               few purer illustrations than a civil judgment for money damages
               on the one hand and a dissolution decree on the other. We see
               little reason for transporting the post-judgment interest statute
               into the equitable world of dissolutions, where some court
               orders look a good deal like civil judgments and others bear no
               resemblance.

               In a straight civil judgment, post-judgment interest and the time
               value of money bear such a straightforward relationship that
               courts are led to deploy adages like “interest goes with the
               principal as the fruit with the tree.” Reese v. Reese, 696 N.E.2d
               460, 463 (Ind. Ct. App. 1998). By contrast, judicial decrees that
               assign debts, personal property, and real estate represent a
               more complex allocation of economic values. To these are
               added orders that reflect social objectives, such as enabling
               children and the leading custodian to continue living in the
               marital residence.

               In such judicial decrees (and we rate the one before us as quite
               typical), where courts allot everything from physical objects to
               responsibility for debts of differing character to conditional rights
               of residence, the time value of money acquires a much more


       Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019         Page 10 of 12
               nuanced meaning than it does when a court hears a credit card
               collection case and says, “Judgment for $5,800.”

               We conclude that the statute on civil post-judgment interest
               does not compel that interest run on the various internal
               elements of dissolution decrees. Rather, the dissolution
               statutes confer upon trial courts the authority to order interest
               or not in the course of fashioning a just and reasonable division
               of property.


       Id. (emphases added).


[18]   The present case is on all fours with Rovai. The court in that case, as in the

       present case, ordered an equal division of the marital assets. It also ordered, as

       the trial court did here, one party to make an equalization payment to the other.

       Although there was no provision in Rovai for payment by installment, the wife

       did not have to pay until some point in the future. The same is true here, as

       Wife will not receive the full amount of the equalization payment until six years

       have passed. And the decree here, as in Rovai, did not call for interest even

       though the equalization payment was reduced to a judgment. Despite this, the

       Rovai court did not hold that interest was required in such a situation; to the

       contrary, it affirmed that, in such situations, the decision of whether to award

       interest is within the discretion of the trial court.


[19]   Thus, contrary to Wife’s claims, the trial court was not required as a matter of

       law to include an award of interest when it reduced the equalization payment to

       a judgment. Instead, the decision to award interest, or not, was wholly within

       the discretion of the trial court.

       Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019       Page 11 of 12
[20]   To the extent that Wife argues that the trial court abused its discretion in failing

       to award interest under the particular facts of this case, we disagree. We first

       note that Wife has failed to provide us with a transcript of the hearings before

       the trial court. Thus, we are unable to review any evidence Wife presented in

       support of a discretionary award of interest. Nor do the facts in the record

       before us establish any abuse of discretion on the part of the trial court. Wife

       will still receive $6,000 per month, plus a very large balloon payment. She will

       be paid in full within six years, and if Husband is late on any of the payments,

       interest will then accrue. Such an arrangement was well within the equitable

       discretion of the trial court in dividing the martial estate.


                                                  Conclusion

[21]   Under the facts and circumstances of the present case, and given our supreme

       court’s holding in Rovai, we cannot say that the trial court abused its

       considerable discretion when it failed to include an award of interest in the

       equalization payments the court ordered Husband to pay to Wife. We therefore

       affirm the judgment of the trial court.


[22]   Affirmed.


       Vaidik, C.J., and Crone, J., concur.




       Court of Appeals of Indiana | Opinion 18A-DR-2139 | March 18, 2019        Page 12 of 12
