                                            No. 02-418

                IN THE SUPREME COURT OF THE STATE OF MONTANA

                                           2003 MT 50N


In Re the Marriage of:

MARY ANN KRASKE,

              Petitioner and Appellant,

and

WILLIAM WADE KRASKE,

              Respondent and Respondent.



APPEAL FROM:             District Court of the Thirteenth Judicial District,
                         In and for the County of Yellowstone, Cause No. DR 99-0742,
                         The Honorable G. Todd Baugh and Gregory R. Todd, Judges presiding.


COUNSEL OF RECORD:

              For Appellant:

                         Mary Ann Kraske (pro se), Billings, Montana

              For Respondent:

                         Patrick C. Sweeney, Attorney at Law, Billings, Montana


                                                     Submitted on Briefs: October 31, 2002

                                                                Decided: March 24, 2003
Filed:


                         __________________________________________
                                           Clerk
Justice Terry N. Trieweiler delivered the Opinion of the Court.

¶1     Pursuant to Section I, Paragraph 3(c), Montana Supreme Court 1996 Internal

Operating Rules, the following decision shall not be cited as precedent but shall be filed as

a public document with the Clerk of the Supreme Court and shall be reported by case title,

Supreme Court cause number, and result to the State Reporter Publishing Company and to

West Group in the quarterly table of noncitable cases issued by this Court.

¶2     Mary Ann Kraske filed a petition for dissolution of her marriage to William Wade

Kraske in the District Court for the Thirteenth Judicial District in Yellowstone County. The

District Court dissolved the marriage on August 2, 2001, and entered a final decree resolving

custody, support, and property distribution issues on March 15, 2002. Mary Ann appeals the

District Court's decrees. We affirm the judgment of the District Court.

¶3     Although numerous issues are raised on appeal, those we are able to decide based

on the record before us are the following:

¶4     1. Did the District Court commit reversible error when it bifurcated the issues and

dissolved the parties' marriage before deciding property distribution, custody and

support?

¶5     2. Did the District Court abuse its discretion when it distributed the marital estate?

                   FACTUAL AND PROCEDURAL BACKGROUND

¶6     Mary Ann and William Ward Kraske married on July 3, 1979, in Wyoming.

Subsequent to their marriage, the Kraskes acquired numerous rental properties with

commingled premarital and marital assets. Since their marriage, they have had three


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children, Justin Wade, born on July 1, 1981, Cody William, born on May 3, 1984, and Kari

Ann, born on February 12, 1987. On June 18, 1999, Mary Ann petitioned for dissolution.

¶7     Throughout the dissolution proceedings, the District Court was aware that Mary Ann

and William's marital discord was such that they could not co-manage their numerous rental

properties or other marital property without potential or actual conflict. On July 9, 1999, the

District Court granted Mary Ann's initial temporary restraining order excluding William

from visiting the marital home. Later, on July 20, 2000, William moved for a temporary

restraining order barring Mary Ann from properties that William was managing on the basis

that Mary Ann had harassed and assaulted him. The District Court later denied that request

after a hearing on July 27, 2000. Instead, the District Court orally directed the parties to

reach an agreement with respect to which rental properties each spouse would maintain.

Apparently, the parties managed the properties without further physical confrontation.

¶8     On July 19, 1999, the case was transferred to the Honorable G. Todd Baugh who set

a trial date for January 7, 2000. On December 9, 1999, William moved for continuance of

that date so that his attorney could properly prepare for the trial and complete the exchange

of preliminary disclosure statements. Trial was reset for March 3, 2000. From March 1,

2000, to June 12, 2001, the trial date was rescheduled seven times at Mary Ann's request and

two of her attorneys were given permission to withdraw from representation due to their

inability to work with her. In June of 2001, trial was scheduled for August 1, 2001.

¶9     On July 18, 2001, Mary Ann filed a pro se Motion for Continuance and Motion to

Compel Income and Expense Accounting, based on her contention that William failed to


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disclose necessary information. William objected, and pointed out that all discovery was

supposed to have been completed by September 1, 2000, and that any failure to disclose was

due to Mary Ann's failure to provide preliminary and final disclosures required prior to trial.

On August 1, 2001, after taking testimony from Mary Ann to the effect that there was

serious irreconcilable marital discord, the District Court decided to bifurcate the trial by

dissolving the marriage at that point and continued the remaining property and child custody

issues. The District Court entered an order bifurcating the trial on August 2, 2001, and filed

a decree of dissolution of the marriage on the same date. In its August 2, 2001, Order, the

District Court cited the reasons for its decision to bifurcate the trial:

       The Court notes that this case began on June 18th, 1999 and that this is the
       tenth trial setting for this case with three prior court dates continued to enable
       the Petitioner to seek counsel. Petitioner has had two prior counsel which has
       [sic] sought leave to withdraw which has been granted. The Petitioner
       certainly needs the assistance of counsel to press her claims, at the same time,
       the Respondent has a right to see some end to this matter. While the parties
       seem divided upon issues of property division, child support and maintenance
       there seems no dispute whatever that the marriage is irretrievable [sic] broken.

William served a notice of entry of judgment on Mary Ann on August 2, 2001. The District

Court reset the trial date on the remaining issues for November 9, 2001.

¶10    On November 9, 2001, Mary Ann moved to disqualify the District Court judge, and

for a continuance to better prepare for trial. On November 27, 2002, Judge Baugh agreed

to continue the case and recuse himself from further proceedings. On that date, the case was

assigned to the Honorable Gregory Todd, who re-scheduled the trial for February 4, 2002.

On February 4, 2002, William presented his evidence.              After Mary Ann began the

presentation of her evidence, the court recessed until the following day. On February 5,

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2002, Mary Ann appeared via telephone, and the District Court continued the trial to

February 19, 2002. On February 19, 2002, Mary Ann did not appear for the final day of the

trial, but submitted a letter that was admitted into evidence. In it she stated that she declined

to appear. William finished the presentation of his case. He filed his proposed findings of

fact on February 25, 2002.

¶11    On March 15, 2002, the District Court entered a final judgment and notice of final

judgment. On April 11, 2002, the District Court entered an order denying Mary Ann's

motion for reconsideration. Mary Ann now appeals the District Court's two Decrees of

Dissolution.

                                  STANDARD OF REVIEW

¶12    We review the district court's conclusions of law to determine whether they are

correct. Stanley v. Holms (1997), 281 Mont. 329, 333, 934 P.2d 196, 199. We review a

district court's distribution of the marital estate first to determine whether the district court's

findings of fact are clearly erroneous. Siefke v. Siefke, 2000 MT 281, ¶ 7, 302 Mont. 167,

¶ 7, 13 P.3d 937, ¶ 7. Where the district court's findings of fact are not clearly erroneous,

we will not disturb the district court's distribution of marital property unless the district court

abused its discretion. In re Marriage of Smith (1995), 270 Mont. 263, 267-68, 891 P.2d 522,

525. The standard for determining whether a district court abused its discretion is "whether

the trial court acted arbitrarily without employment of conscientious judgment or exceeded

the bounds of reason resulting in substantial injustice." In re Marriage of Rolfe (1985), 216

Mont. 39, 45, 699 P.2d 79, 83 (citation omitted).


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                                          DISCUSSION

                                             ISSUE 1

¶13       Did the District Court commit reversible error when it bifurcated the issues and

dissolved the parties' marriage before deciding property distribution, custody and support?

¶14       After numerous continuances of the trial date, the District Court ordered that the trial

be bifurcated and dissolved the parties' marriage while reserving issues of child custody and

the distribution of the marital estate for a later date.

¶15       Mary Ann contends that the District Court erred when it entered its first decree on

August 2, 2001, and that after doing so, it lacked further jurisdiction to issue its second

decree of dissolution on March 15, 2002, when it distributed the marital estate and resolved

child custody and support issues. She contends that bifurcation violated § 40-1-104, MCA,

and denied her the right to a trial on the issues of child custody and distribution of the marital

estate.

¶16       William contends that while bifurcation is not a preferred procedure, it is still

permissible despite § 40-1-104, MCA, and was, in this case, necessary due to Mary Ann's

repeated efforts to delay the proceedings. William further contends that, even if this Court

concludes that the District Court erred when it bifurcated the trial, that error was harmless

because Mary Ann had an opportunity to further adjudicate the remaining issues.

¶17       Section 40-4-104(1), MCA, provides that:

          The district court shall enter a decree of dissolution of marriage if:

          ....


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       (b) the court finds that the marriage is irretrievably broken . . .
       (c) the court finds that the conciliation provisions of the Montana Conciliation
       Law and of 40-4-107 either do not apply or have been met; and
       (d) to the extent it has jurisdiction to do so, the court has considered
       approved, or made provision for parenting, the support of any child entitled
       to support, the maintenance of either spouse, and the disposition of property.
       [Emphasis added.]

Section 40-4-108(1), MCA, further provides that "[a] decree of dissolution of marriage or

of legal separation is final when entered, subject to the right of appeal." In In re Marriage

of Skinner (1989), 240 Mont. 299, 783 P.2d 1350, we concluded based on § 40-4-104,

MCA, that it was error to bifurcate the issues in a dissolution. We stated:

       In this case we note the District Court entered a decree of dissolution of the
       marriage on November 2, 1987, and it was not until February 6, 1989 that the
       District Court filed its final judgment relating to the disposition of the marital
       property. The requirement of § 40-4-104(1), MCA, was not met. The District
       Court should have entered judgment relating to the disposition of marital
       property before entering the decree of dissolution of the marriage.

               Although we will not find reversible error in this instance, we call to
       the attention of the bench and bar the necessity to comply with the above statute.

Skinner, 240 Mont. at 302, 783 P.2d at 1352.

¶18    Based on our decision in Skinner, we conclude that the District Court erred when it

bifurcated the trial, and must consider whether the District Court's error was harmless. In

Zeke's Distributing v. Brown-Forman (1989), 239 Mont. 272, 278, 779 P.2d 908, 912, this

Court held that "[f]or error to be the basis for a new trial, it must be so significant as to

materially affect the substantial rights of the complaining party." "A harmless error does not

mandate that we reverse a district court judgment; an 'error must cause substantial prejudice'

to warrant reversal." Tipp v. Skjelset, 1998 MT 263, ¶ 16, 291 Mont. 288, ¶ 16, 967 P.2d


                                               7
787, ¶ 16 (quoting Erickson v. State ex rel. Bd. of Med.Exam. (1997), 282 Mont. 367, 375,

938 P.2d 625, 630).

¶19    Mary Ann suggests that the District Court's error was not harmless and contends that

the District Court lacked jurisdiction after it issued its original decree of dissolution.

¶20    In In re Marriage of Bukacek (1995), 274 Mont. 98, 907 P.2d 931, we considered

whether a district court lacked subsequent jurisdiction over a dissolution proceeding after it

orally granted a decree of dissolution and expressly reserved final resolution of custody and

estate distribution issues, which it decided two years later. The appellant in Bukacek

contended that the District Court's dissolution of the marriage ended its jurisdiction in the

matter. However, we disagreed, and stated:

       The term "decree" includes the term "judgment." Section 40-4-103(4), MCA.
       The Montana Rules of Civil Procedure define "judgment" as "the final
       determination of the rights of the parties in an action or proceeding . . . and
       includes a decree . . . ." Rule 54(a), M.R.Civ.P. (emphasis added). Although
       the District Court in this case purported to orally grant the parties' dissolution
       at the initial hearing, that statement was by no means a "final determination"
       of the couple's rights. As the court stated at that time, the issues of child
       custody, support, and maintenance had yet to be decided. Furthermore, the
       court later acknowledged that it had no jurisdiction to grant a dissolution
       without resolving those related issues.

Bukacek, 274 Mont. at 102-03, 907 P.2d at 933-34. We concluded that the District Court's

order granting the dissolution was not a final decree which divested the court of further

jurisdiction.

¶21    For the same reason, we conclude that the District Court retained jurisdiction in these

proceedings. It was without authority to dissolve the marriage without deciding the

remaining issues and made clear that it did not intend to do so.

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¶22    Since the District Court did not have the authority to issue a final decree prior to

resolution of all of the parties' respective rights, we conclude that the District Court

continued to retain jurisdiction to try all of the issues in the custody proceedings. The

District Court did try all of the remaining issues, on February 4, and February 19, 2002.

Mary Ann has failed to demonstrate how the District Court's error affected any of her

substantial rights. Any prejudice she ultimately may have suffered was due to her own

failure to appear at trial when it was scheduled. Therefore, while we conclude that the

District Court erred by bifurcating the proceedings, we conclude that the error was not

grounds for reversal.

                                          ISSUE 2

¶23    Did the District Court abuse its discretion when it distributed the marital estate?

¶24    Mary Ann contends that the District Court abused its discretion when it distributed

the marital assets because it gave her all of the marital liabilities, and the less desirable

properties.

¶25    We first note that, contrary to Mary Ann's suggestion, the record does not suggest that

the District Court distributed property without a trial. The only pre-trial disposition of the

property relates to the District Court's distribution of the responsibility for maintaining and

collecting rent from the rental properties, an arrangement that was clearly interlocutory and

for the purpose of preventing conflict between the parties while preserving the assets in the

marital estate.

¶26    With respect to the final distribution, we first conclude that the District Court's


                                              9
findings with respect to the value of the assets in the marital estate was not clearly erroneous.

At trial, William provided testimony and documentary evidence of the property values.

Mary Ann failed to appear at trial to contest these valuations or present different valuations.

We have previously determined that:

       A district court has far reaching discretionary powers to determine the value
       of property in a dissolution action. Its valuation can be premised on expert
       testimony, lay testimony, documentary evidence, or any combination thereof.
       As long as the valuation is reasonable in light of the evidence submitted, we
       will not disturb that finding on appeal.

In re Marriage of Milesnick (1988), 235 Mont. 88, 94-95, 765 P.2d 751, 755 (citations

omitted). Under these circumstances, we conclude that the District Court's final values for

the assets and liabilities in the marital estate were reasonable in light of the evidence

submitted, and were not clearly erroneous.

¶27    The District Court then distributed the marital estate as follows:

                                     Mary Ann                             William

Total Personal Property              $ 15,500                             $ 78,000
Total Real Property                   358,166                              451,098
Total Liabilities &
Premarital/Inherited Value              (88,000)                           (274,058)
Net Estate                           $ 285,666                            $ 255,040

This Court has previously recognized that § 40-4-202, MCA, vests the District Court with

"broad discretion to distribute the marital estate in a manner which is equitable to each party

according to the circumstances of the case," Smith, 270 Mont. at 268, 891 P.2d at 525, and

provides:

       In making apportionment, the court shall consider the duration of the marriage
       and prior marriage of either party; the age, health, station, occupation, amount

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       and sources of income, vocational skills, employability, estate, liabilities, and
       needs of each of the parties; custodial provisions; whether the apportionment
       is in lieu of or in addition to maintenance; and the opportunity of each for
       future acquisition of capital assets and income . . . .

Section 40-4-202, MCA. Although William received a greater proportion of the assets of the

marital estate, the District Court found that William retained substantially more premarital

property than Mary Ann and adjusted the final distribution to reflect the parties' premarital

property. Excluding the parties' premarital property, Mary Ann received a greater proportion

of the remaining marital assets, and both parties received income-generating rental

properties. We conclude that the District Court did not abuse its discretion when it

distributed the marital property.

¶28    For the foregoing reasons, the judgment of the District Court is affirmed.


                                                          /S/ TERRY N. TRIEWEILER


We Concur:


/S/ KARLA M. GRAY
/S/ PATRICIA COTTER
/S/ JAMES C. NELSON
/S/ W. WILLIAM LEAPHART




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