Pursuant to Ind.Appellate Rule 65(D),
this Memorandum Decision shall not be
regarded as precedent or cited before                         May 30 2013, 9:13 am
any court except for the purpose of
establishing the defense of res judicata,
collateral estoppel, or the law of the case.


ATTORNEYS FOR APPELLANT:                                ATTORNEYS FOR APPELLEE:

LAURIE BAIDEN BUMB                                      KEITH W. VONDERAHE
Bumb & Vowels, LLP                                      JEAN M. BLANTON
Evansville, Indiana                                     Ziemer, Stayman, Weitzel & Shoulders, LLP
                                                        Evansville, Indiana
THOMAS A. MASSEY
Massey Law Offices
Evansville, Indiana


                               IN THE
                     COURT OF APPEALS OF INDIANA

IN RE THE MARRIAGE OF                               )
KENNETH G. HAYNIE, JR.,                             )
                                                    )
       Appellant-Petitioner,                        )
                                                    )
               vs.                                  )     No. 82A01-1206-DR-265
                                                    )
TERESA H. HAYNIE,                                   )
                                                    )
       Appellee-Respondent.                         )


                 APPEAL FROM THE VANDERBURGH SUPERIOR COURT
                        The Honorable Wayne S. Trockman, Judge
                            Cause No. 82D04-1103-DR-243


                                           May 30, 2013

                 MEMORANDUM DECISION - NOT FOR PUBLICATION

BAILEY, Judge
                                               Case Summary

        Kenneth G. Haynie, Jr. (“Husband”) and Teresa H. Haynie (“Wife”) were divorced

and their marital estate distributed. Husband challenged the division of marital assets in a

motion to correct error. The dissolution court modified its prior order for the distribution of

assets, and the former spouses filed cross-motions to correct error. Both motions were

denied. Husband now appeals.1 We affirm in part, reverse in part, and remand with

instructions.

                                                     Issues

        Husband presents the following consolidated and restated issues:

        I.       Whether the dissolution court contravened statutory authority by
                 systematically excluding Wife’s inherited assets from the marital estate;
                 and

        II.      Whether the dissolution court abused its discretion in the division of
                 marital assets.

                                     Facts and Procedural History

        The parties were married on February 6, 1988. On March 15, 2011, Husband filed a

petition for dissolution. During the course of the twenty-three year marriage, Wife was


1
  According to Wife, Husband has forfeited his right to appeal because he did not appeal within thirty days of
the order on the first motion to correct error. However, it is readily apparent that the order on motion to correct
error substantially changed the division of assets. Furthermore, the dissolution court failed to address
Husband’s contention that a significant portion of the assets allocated to him had not been transferred to him
from Wife. Each party then sought to correct error or obtain clarification. They agreed to treat Husband’s
motion for clarification as a new motion to correct error. After a motion to correct error has been filed and the
trial court has then altered, modified, or supplemented its findings or judgment, the parties have the discretion
to appeal immediately or to file a new motion to correct error directed to the altered findings or judgment.
Breeze v. Breeze, 421 N.E.2d 647, 650 (Ind. 1981). Time periods for the purpose of the appellate rules then
start from the time of the trial court’s ruling on the second motion to correct error. Id. Husband permissibly
awaited the outcome of his second motion to correct error, which challenged the order modifying the division
of assets. Accordingly, we reject Wife’s request that we dismiss Husband’s appeal.

                                                        2
continuously employed by Easter Seals Rehabilitation Center. She is currently a vice-

president of that organization. Husband was first employed as a securities broker; he then

practiced law for eighteen years. He was unemployed at the time of the dissolution hearing.

Wife requested a division of marital assets in her favor, arguing that she had made greater

contributions to the acquisition of assets.

       At the final hearing, the parties stipulated to values to be assigned to their assets. In

2010, Husband had received a $200,000 settlement arising from the wrongful death of his

daughter. The funds were placed in Raymond James Account **2373. A portion was used

for medical expenses; as of March 2011, $123,743.00 remained in the account. At some time

during the marriage, Husband was made a beneficiary of an irrevocable life insurance trust.

The cash value was $85,000.00. He also held some contingent interests in property. Wife

had inherited a partial interest in real estate (valued at $100,000.00) and an investment

account which was worth $107,211.00 at the time of the dissolution.

       Wife was in possession of the marital residence, which had no mortgage and was

valued at $205,000.00. After the date of separation, Husband had acquired a residence, using

marital funds from the Raymond James Account **2373 and a Raymond James IRA Trust.

The residence had no mortgage and was valued at $78,500.00. The parties also had several

retirement and investment accounts.

       On November 14, 2011, the dissolution court entered its findings of fact, conclusions

of law, and order. The order setoff to Wife the value of inherited real estate, provided that

each party was to retain the personal property and vehicle in his or her possession, and


                                               3
allocated the real property as well as retirement, irrevocable trust, and investment funds. It

was determined that Husband’s interest in a revocable trust and his contingent interest in a

residuary trust for the care of his mother were not divisible assets. The dissolution court

declined to setoff to Wife retirement accounts initially funded prior to the marriage. The

court’s stated intent was that a near-equal division of the marital estate, after setoff of

inherited property, be effected. Wife was awarded possession of the marital residence and

was ordered to pay Husband $105,000.00 for his share of the equity.

       On December 8, 2011, Husband filed a motion to correct error. A hearing was

conducted on January 25, 2012. Thereafter, the dissolution court issued an order correcting

mathematical error and ordering Husband’s counsel to prepare a Qualified Domestic

Relations Order for the payment of $57,371.00 to Husband. The dissolution court reiterated

its intention to setoff to Wife her inherited interest in real estate and further clarified:

       The Court’s intention was not to divide the Raymond James Account #9198,

       representing funds inherited by the Former Wife. Any request by the Former

       Husband to distribute the funds in this Account different from the Decree is

       denied.

(App. 24.)

       On March 1, 2012, Husband filed a request for clarification which was, by stipulation

of the parties, treated as a new motion to correct error. Wife filed a cross-motion to correct

error. On May 11, 2012, the dissolution court denied the respective motions. This appeal

ensued.


                                                4
                                   Discussion and Decision

                           I. Alleged Exclusion of Inherited Assets

                                      Standard of Review

       We review the grant or denial of a motion to correct error for an abuse of discretion.

Williamson v. Williamson, 825 N.E.2d 33, 44 (Ind. Ct. App. 2005). Husband’s motion to

correct error challenged findings of fact and conclusions of law entered by the dissolution

court, at Husband’s request, pursuant to Indiana Trial Rule 52. Accordingly, we must

determine whether the evidence supports the findings and second, whether the findings

support the judgment. K.I. ex rel. J.I. v. J.H., 903 N.E.2d 453, 457 (Ind. 2009). We will not

set aside the findings or judgment unless clearly erroneous, and due regard must be given to

the opportunity of the trial court to judge the credibility of the witnesses. Id. (citing Ind. Trial

Rule 52(A)). A judgment is clearly erroneous when there is no evidence supporting the

findings or the findings fail to support the judgment. Id. A judgment is also clearly

erroneous when the trial court has applied the wrong legal standard to properly found facts.

Id.

                                             Analysis

       The division of marital property involves a two-step process.                Thompson v.

Thompson, 811 N.E.2d 888, 912 (Ind. Ct. App. 2004), trans. denied. First the trial court

must determine what property is to be included in the marital estate, or marital pot. Id.

Second, the trial court must divide the marital property under the presumption that an equal

split is just and reasonable. Id. (citing Ind. Code § 31-15-7-5). Husband contends that the


                                                 5
dissolution court expressed an intention to divide the entirety of the parties’ property in a

substantially equal manner but nevertheless systematically excised assets that Wife had

inherited.

       The distribution of marital property is committed to the sound discretion of the trial

court. Breeden v. Breeden, 678 N.E.2d 423, 427 (Ind. Ct. App. 1997). A party who

challenges the trial court’s division of marital property must overcome a strong presumption

that the court considered and complied with the applicable statute. In re Marriage of Bartley,

712 N.E.2d 537, 542 (Ind. Ct. App. 1999). Even if the facts and reasonable inferences might

allow a conclusion different from that reached by the trial court, we will not substitute our

judgment for that of the trial court unless its decision is clearly against the logic and effect of

the facts and circumstances before it. Perkins v. Harding, 836 N.E.2d 295, 299 (Ind. Ct.

App. 2005).

       In determining the value of the marital estate, the dissolution court is required to

include property owned by either spouse before the marriage, acquired by either spouse in his

or her own right after the marriage and before final separation of the parties, or acquired by

their joint efforts. Ind. Code § 31-15-7-4. This “one pot” theory prohibits the exclusion of

any asset in which a party has a vested interest from the scope of the trial court’s power to

divide and award. Hann v. Hann, 655 N.E.2d 566, 569 (Ind. Ct. App. 1995), trans. denied.

Accordingly, the systematic exclusion of any marital asset from the marital pot is erroneous,

including those attributable to a gift or an inheritance from one spouse’s parents. Wallace v.

Wallace, 714 N.E.2d 774, 780 (Ind. Ct. App. 1999), trans. denied. However, although the


                                                6
trial court must include all assets in the marital pot, it may ultimately decide to award an asset

solely to one spouse as part of its just and reasonable property division. Ind. Code § 31-15-7-

5(2)(B) (providing that the trial court may consider as evidence to rebut the presumptive

equal distribution “the extent to which the property was acquired by each spouse through

inheritance or gift”). Even where the trial court properly sets aside the value of premarital

assets to one spouse, the appreciation over the course of the marriage is a divisible marital

asset. Wanner v. Hutchcroft, 888 N.E.2d 260, 262 (Ind. Ct. App. 2008).

       Here, the dissolution court included the inherited assets in the marital pot and

considered that property potentially subject to division, but decided to award the full value of

those assets to Wife. We have previously affirmed a property division which included the

setting aside of an inherited asset when the dissolution court clearly delineated reasoning

beyond simply reiterating the fact that it was an inheritance. See Maxwell v. Maxwell, 850

N.E.2d 969, 973 (Ind. Ct. App. 2006). Here, the trial court’s reasons, expressed in the

property division order and the order on motion to correct error, were that the real estate had

been in Wife’s family for many years, Wife had inherited only a partial interest, Wife had

brought more assets into the marriage, and Husband also had property interests set aside to

him. The court did not systematically excise a marital asset from the marital estate. Rather,

after due consideration, with evidentiary support, the trial court setoff to Wife the value of

assets acquired by inheritance. As such, the trial court did not disregard relevant statutory

authority to effect a property division in this marital dissolution action.




                                                7
                               II. Division of Marital Pot after Setoff

        Husband claims that he received a lesser share because of duplication in the allocation

of assets to him. According to Husband, the dissolution court credited him with retaining the

residence valued at $78,500.00 as well as a portion of the funds used to acquire the

residence.2 He further contends that the decree failed to include an order that Wife transfer to

him his share of the Raymond James Account **2373.

        The dissolution decree ordered the following division of assets (excluding vehicles

with substantially equal value):

        Husband                                                              Wife

Irrevocable Life Ins. Trust                85,000.00 Raymond James **9188     107,211.00
Wrongful Death Settlement                 123,743.00 Raymond James **5864      64,936.00
½ Marital Residence                       105,000.00 ½ Raymond James **6156     3,957.00
Raymond James IRA **6043                  112,532.00 ½ Marital Residence      105,000.00
Jewelry                                    36,000.00 Raymond James **9179      35,147.00
½ Tax Refund                                4,839.50 Easter Seals Retirement  271,000.00
½ Raymond James **2373                      8,020.00 Jewelry                   29,025.00
½ Raymond James **5156                      3,957.00 ½ Tax Refund               4,839.50
Husband’s Residence                        78,500.00 ½ Raymond James **2373     8,020.00
Guns and Personal Property                  6,380.00 Personal Property         32,581.00
                                         $563,971.50                         $661,716.50

        On motion to correct error, Husband contended that his assets had been over-valued

by $32,242.00 when the dissolution court included both the full purchase price of his

residence and the date-of-separation value of the Raymond James Account **2373. In

addition to using gift funds of $46,258.00 for the residential purchase, Husband had used

2
 Generally, property acquired by one spouse after the date of final separation is not property includable in the
marital pot. Thompson, 811 N.E.2d at 912. The final separation of the parties is “the date of filing of the
petition for dissolution of marriage.” Ind. Code § 31-9-2-46. Here, however, it is undisputed that Husband
used marital pot funds (gift from mother and funds from wrongful death account) to acquire the residence.

                                                       8
$32,242.00 from Account **2373. He also pointed out that there had been a $4,000.00

mathematical error in his favor because jewelry awarded to Wife had been over-valued by

that amount. Husband sought a Qualified Domestic Relations Order in the amount of

$113,083.50 to effect an equal division of assets (including those that had been set off to

Wife in which he believed he was entitled to share). Finally, he sought an order that Wife be

required to transfer $87,000.00 cash from the Raymond James Account **2373 and

$3,923.00 from the Raymond James Account **6156 to effect the actual distribution of those

accounts as contemplated in the dissolution decree.

        The dissolution court responded by clarifying its intent to setoff inherited assets to

Wife, “correct[ing] mathematical errors regarding the jewelry and the Raymond James

Freedom Account #2373” and ordering that $57,371.00 be transferred from Raymond James

Account **9188 (Wife’s 401(k)) to Husband, by means of a Qualified Domestic Relations

Order. (App. 24.)

        Husband filed a request for clarification, contending that the dissolution court had

failed to address the request for an immediate transfer of the $87,000.00 remaining from the

wrongful death settlement (allegedly in Wife’s control although awarded to Husband). Wife

also filed a motion to correct error, contending that a “near equal” distribution consistent

with the dissolution decree had been effected without the $57,371.00 order for payment.3

        After the order on motion to correct error, the division of assets is as follows:


3
 Wife’s balance sheet assigned a value of $10,200 to Husband’s gun collection (assigned a zero value by the
dissolution court, as Husband had donated the guns to a museum and Wife was to utilize the charitable tax
deduction).

                                                    9
       Husband                                                    Wife

Irrevocable Life Ins. Trust       85,000.00         Raymond James **5864     64,936.00
Wrongful Death Settlement        123,743.00         ½ Raymond James **6156    3,957.00
½ Marital Residence              105,000.00         ½ Marital Residence     105,000.00
Raymond James IRA **6043        112,532.00          Raymond James **9179     35,147.00
Jewelry                           36,000.00         Easter Seals Retirement 271,000.00
½ Tax Refund                       4,839.50         Jewelry                  25,025.00
½ Raymond James **2373             8,020.00         ½ Tax Refund              4,839.50
½ Raymond James **5156             3,957.00         ½ Raymond James #2373     8,020.00
Cash used for residence purchase 46,258.00          Personal Property        32,581.00
       (gift from mother)
Guns and personal property         6,380.00                                       ________
                               $531,729.50                                      $550,505.50

Accordingly, Wife was awarded $18,776 more in assets, after setoff, than Husband. With the

marital estate having a value of over one million dollars, this is arguably within the

dissolution court’s objective of a near-equal distribution after setoff of inherited assets.

       However, the dissolution court also ordered Husband’s counsel to prepare a Qualified

Domestic Relations Order in the amount of $57,371.00, presumably to correct mathematical

error in the dissolution decree. This sum appears to correspond to an equalization payment

amount reflected on “Exhibit B” (apparently produced by Husband on motion to correct

error). (App. 56.) However, “Exhibit B” contemplated that Husband’s life insurance trust

(valued at $85,000.00) would be setoff to him and Wife’s inherited property setoff to her,

with a total of $1,008,885.00 in remaining assets equally divided. This was not, in fact, the

division of assets made by the dissolution court.

       Moreover, the order on motion to correct error does not address Husband’s contention

that a substantial portion of the assets allocated to him ($87,000 from Raymond James

Account **2373 and $3,923.00 from Raymond James Account **6156) have not been

                                              10
transferred to him. Husband testified that Wife has $87,000.00 of the wrongful death

account funds in her possession. Wife does not deny this, but claims that Husband suggested

she use the money to pay him for his part of the equity in the marital residence. She directs

our attention to Husband’s testimony:

       Counsel: In fact, if [Wife] wanted to she could use that Eighty-Seven
       Thousand Dollars that came from your daughter’s wrongful death settlement to
       help fund the Hundred, Five Thousand Dollar [sic], one half equity payout?

       Husband: Yes, I suppose she could or take out a mortgage.

       Counsel: But, if she transferred that money essentially back to you, then the
       equalization payment would be somewhat less than Twenty Thousand Dollars
       cash?

       Husband: I’m – I’m not sure I follow.

       Counsel: Well, look down in the bank account column. The Raymond James,
       the Hundred, Twenty-Three Thousand that was divided from your daughter’s
       wrongful death settlement?

       Husband: No. I think it would be a Hundred and Twenty-Two Thousand.

       Counsel: No. Eighty-seven is currently sitting in [Wife’s] account and you
       have -

       Husband: Right.

       Counsel: Thirty-Six in yours?

       Husband: Right.

       Counsel: Which you’ve already spent to get your house?

(Tr. 103.) This exchange took place after counsel had first proposed a $222,776.00

equalization payment to Husband from Wife’s retirement funds. It is in this context that

Husband concedes that Wife might use available cash from an account in her control to pay

                                             11
him for residential equity. He did not at any time propose to relinquish his claim on the

wrongful death funds or suggest that Wife could retain them without accounting for such.

          The order on motion to correct error does not reflect the dissolution court’s intention

to divide the marital pot in a substantially equal manner after setoff. It does not provide for

the transfer of liquid assets allocated to Husband but within Wife’s control. We therefore

remand for an equal or substantially equal division of the marital assets after setoff and such

orders as are necessary to effect transfer of assets in accordance with the property

distribution.

                                            Conclusion

          The dissolution court did not err as a matter of law in setting aside to Wife assets that

she had inherited for reasons delineated and supported by the evidence. However, the

dissolution decree and order on motion to correct error do not correspond with a substantially

equal division of the remaining assets. Moreover, Husband is entitled to an order for the

transfer of assets actually allocated to him by the dissolution court in its division of marital

assets.

          Affirmed in part, reversed in part, and remanded with instructions.

NAJAM, J., and BARNES, J., concur.




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