J.A19031/14

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37


CHRISTINE L. BERNARDO,                      :     IN THE SUPERIOR COURT OF
                                            :          PENNSYLVANIA
                          Appellee          :
                                            :
                    v.                      :
                                            :
                                            :
ROBERT R. BERNARDO,                         :
                                            :
                          Appellant         :     No. 1838 WDA 2013


                    Appeal from the Order November 8, 2013
               In the Court of Common Pleas of Clearfield County
                      Civil Division No(s).: 2011-1637-CD

BEFORE: BENDER, P.J.E., OLSON, and FITZGERALD,* JJ.

MEMORANDUM BY FITZGERALD, J.:                       FILED AUGUST 13, 2014

        Appellant, Robert R. Bernardo (“Husband”), appeals from the equitable

distribution order entered in the Clearfield County Court of Common Pleas.1

Appellant contends the court erred in formulating a 55%/45% equitable

distribution scheme in favor of Appellee, Christine L. Bernardo (“Wife”),



*
    Former Justice specially assigned to the Superior Court.
1
  Appellant filed the instant appeal prior to the entry of a final decree in
divorce. This Court issued a rule to show cause why the appeal should not
be quashed pursuant to Campbell v. Campbell, 516 A.2d 363 (Pa. Super.
1986) (holding that order of equitable distribution may not be appealed until
entry of final divorce decree.) If a decree is entered during the pendency of
the appeal, the appeal is perfected. Id. at 366. On December 23, 2013, the
court entered a final divorce decree. Therefore, this appeal is perfected.
See id.
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determining Appellee was entitled to a reduction of the value of the marital

real estate for realtor’s fees and commission, and awarding her alimony. We

affirm.

      The master made the following, inter alia, findings of fact:2

            Wife was 44 years old at the time of the Master’s
          hearing. . . .

            Husband was 50 years old at the time of the Master’s
          hearing. . . .

                                  *    *    *

             The parties were married on September 5, 1992 and
          separated on September 29, 2011.

             There was one child born of this marriage . . . dob
          [1996]. The child is in the primary physical custody of
          Wife.

                                  *    *    *

            Husband is employed full-time with UPS. Husband has
          been employed in a full-time basis with UPS since 1998. . .
          .

             Husband earns approximately $59,000.00 per year in
          his position as a UPS package car driver.

             Husband also has numerous benefits available to him
          through his employment with UPS. Husband’s benefits
          include: paid vacation, 401(k) plan, UPS pension plan,
          stock options, Teamster’s pension plan and medical
          insurance.

             Husband is a high school graduate and did attend West
          Virginia University for approximately two years. . . .

2
 The trial court “fully adopt[ed] all of the terms and provision of the Report
and Recommendations filed by the Master . . . .” Trial Ct. Order, 11/8/13.



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             Wife is self-employed and is the sole employee of Chris
          Bernardo’s Carpet Shack. Wife has owned and operated
          this business since approximately 2001.

             Wife does not have benefits available to her
          employment, although Wife has started her own IRA fund.
          At the time of the Master’s hearing Wife depended on
          Husband for her health insurance.

             Wife is a high school graduate and also holds an
          Associate’s Degree in Art, Letters & Sciences from Penn
          State University.

              Wife additionally has taken courses during the marriage
          in regards to real estate and has a license as a Nail Tech.

              Wife also has experience working in interior design, but
          is not licensed in this area.

Master’s Report & Recommendation, 9/18/13, at 4-6 (citations to transcript

and paragraph numbers omitted).

     The master recommended that a distribution scheme of 55%/45%

division in favor of Wife.3 Proposed Order, 9/18/13, at 1. The master also

recommended that Wife receive alimony in the amount of $300 per month

for a period of two years from the date the proceedings are finalized. Id. at

3.

     Husband filed exceptions to the report and recommendation of the

master.   The court held a hearing and subsequently dismissed Husband’s

exceptions.     The   court   entered   an    order   adopting   the   report   and


3
 We note that the parties stipulated to the value of the marital property.
See Stipulation & Supplemental Stipulation, 8/9/13.



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recommendations filed by the master.           This timely appeal followed.

Husband filed a timely court-ordered Pa.R.A.P. 1925(b) statement of errors

complained of on appeal.

      Husband raises the following issues for our review:

         [1]. Did the lower court err in determining that [Husband]
         has “numerous benefits available” to him, which warrants
         the uneven distribution scheme?

         [2]. Did the lower court err in determining that [Husband]
         has not contributed to the education, training and
         increased earning power of [Wife]?

         [3]. Did the lower court err in determining that the parties
         are similarly situated in regards to the ability to acquire
         future capital assets and income?

         [4]. Did the lower court err in determining that [Wife] is
         automatically entitled to a reduction of the value of marital
         real estate for realtor’s fees and commission pursuant to
         23 Pa.C.S. § 3502(a)(10.2)?

         [5]. Did the lower court err in awarding alimony to [Wife]?

         [6]. Did the lower court err in determining that a fair and
         reasonable distribution of the marital estate should be
         55%/45% in favor of [Wife]?

Husband’s Brief at iv.

      We address Issues 1, 2, 3, and 6 together because they are related.4

Husband first argues the court erred in determining, under 23 Pa.C.S. §


4
  We note that in issues 1, 2, and 3 in the argument section of Husband’s
brief, with the exception of the quotations of 23 Pa.C.S. § 3502(a)(6),
3502(a), 3502(a)(5), and 3502, respectively, Husband does not cite to or
discuss any legal authority. The “failure to develop an argument with
citation to, and analysis of, relevant authority waives that issue on review.”



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3502(a)(6), that he had numerous benefits available to him warranting the

uneven distribution scheme. Husband states that as of January, 2014, he

will have to pay for a portion of his medical insurance. Id. at 10. At the

master’s hearing Husband testified that he did not know the amount of his

contribution. N.T., 6/7/13, at 203.    Husband asserts that his pension is “a

minor benefit at best” because at the present time his employer only

contributes 0.5% to his pension, which is less than $3000 a year. Husband’s

Brief at 10. He claims that his “401(k) is not really a benefit” because his

Harris v. Toys “R” Us-Penn, Inc., 880 A.2d 1270, 1279 (Pa. Super.
2005); see also Pa.R.A.P. 2119(b). However, because this defect does not
impede our ability to conduct appellate review, we decline to find waiver.

       Additionally, in Issue 6, Appellant claims the 55%/45% distribution of
marital property is inequitable. Husband’s Brief at 24. His sole argument is:
“As not to waste this Honorable Court’s time, [Husband] refers this
Honorable Court to all the previous arguments in this brief since the factors
for equitable distribution have already been addressed in their own section
or in the alimony section.” Id. at 24-25.

     Where an appellant incorporates previous issues by reference as the
argument for an issue, this Court has declined to consider the issue
separately. In Lynn v. Pleasant Valley Country Club, 54 A.3d 915 (Pa.
Super. 2012), we held:

               Although [the a]ppellant lists five questions for our
        review, his arguments with respect to issues one and two
        are intertwined. We address those issues together. [The
        a]ppellant’s arguments with respect to issues three and
        five incorporate previous arguments by reference, with no
        additional discussion. . . . As a result, we dispose of these
        issues in our analysis of [the a]ppellant’s other issues.

Id. at 918. Analogously, we address Issue 6 in our analysis of Husband’s
other issues. See id.




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employer does not make any contribution to it. Id. at 10-11. He states

that his stock option is not a benefit because he is required to pay full price

for the company stock. Id. at 11.

      Husband’s second claim is that the court erred in failing to give him

credit, under subsection 3502(a)(4), for paying for Wife’s classes for interior

design and real estate and to become a nail technician. Id. at 12. He avers

that he “sustain[ed] the family unit through his income.” Id. He also points

out that the master and the court emphasized the fact that Wife “is not

using her classes or licenses in her current position as a small business

owner.” Id.

      In his third issue, Husband avers that the court erred, under

subsection 3502(a)(5), in determining that “the parties are similarly situated

in regard to the ability to acquire future capital assets      and income.”      Id.

Husband    points   out   that    Wife’s   “average   annual   gross    income    is

approximately $53,000[,]” while his is $59,000.        Id. at 13.      He concedes

that “[b]ased on those incomes alone, one could make an argument that the

parties are similarly situated or [he] is in a better position moving forward.”

Id. at 14. Husband claims the distribution of assets 55%/45% in favor of

Wife is inequitable. Id. at 24.

             We review an equitable distribution order for an abuse
          of discretion.

            A trial court has broad discretion when fashioning an
            award of equitable distribution. Our standard of
            review when assessing the propriety of an order


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            effectuating the equitable distribution of marital
            property is whether the trial court abused its
            discretion by a misapplication of the law or failure to
            follow proper legal procedure. We do not lightly find
            an abuse of discretion, which requires a showing of
            clear and convincing evidence. This Court will not
            find an abuse of discretion unless the law has been
            overridden or misapplied or the judgment exercised
            was manifestly unreasonable, or the result of
            partiality, prejudice, bias, or ill will, as shown by the
            evidence in the certified record. In determining the
            propriety of an equitable distribution award, courts
            must consider the distribution scheme as a whole.
            We measure the circumstances of the case against
            the objective of effectuating economic justice
            between the parties and achieving a just
            determination of their property rights.

Reber v. Reiss, 42 A.3d 1131, 1134 (Pa. Super. 2012) (citations omitted),

appeal denied, 62 A.3d 380 (Pa. 2012). Furthermore, “[i]n the context of an

equitable distribution of marital property, a trial court has the authority to

divide the award as the equities presented in the particular case may

require.” Id. at 1137 (citation omitted).

      Section 3502 of the Divorce Code governs the equitable distribution of

marital property and provides:

         Factors which are relevant to the equitable division of
         marital property include the following:

            (1) The length of the marriage.

            (2) Any prior marriage of either party.

            (3) The age, health, station, amount and sources of
            income,      vocational   skills,  employability, estate,
            liabilities and needs of each of the parties.




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            (4) The contribution by one party to the education,
            training or increased earning power of the other party.

            (5) The opportunity of each party for future acquisitions
            of capital assets and income.

            (6) The sources of income of both parties, including, but
            not limited to, medical, retirement, insurance or other
            benefits.

            (7) The contribution or dissipation of each party in the
            acquisition, preservation, depreciation or appreciation of
            the marital property, including the contribution of a
            party as homemaker.

            (8) The value of the property set apart to each party.

            (9) The standard of living of the parties established
            during the marriage.

            (10) The economic circumstances of each party at the
            time the division of property is to become effective.

            (10.1) The Federal, State and local tax ramifications
            associated with each asset to be divided, distributed or
            assigned, which ramifications need not be immediate
            and certain.

            (10.2) The expense of sale, transfer or liquidation
            associated with a particular asset, which expense need
            not be immediate and certain.

            (11) Whether the party will be serving as the custodian
            of any dependent minor children.

23 Pa.C.S. § 3502(a)(1)-(11).

      Instantly, the master considered the statutory factors.        As to the

benefits   which Husband has      available   to   him   pursuant to Sections

3502(a)(4-6) the Master opined:




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         Wife earned a certification as a Nail Tech and took a class
         in real estate during the marriage while Husband worked.
         Wife does not use her education in either one of these
         areas and has been employed as the owner/operator of
         Chris Bernardo Carpet Shack.           Neither party has
         contributed to the increased earning capacity of the other.
         ...

         The parties are similarly situated in regard to the ability to
         acquire future capital assets and income. Husband has a
         greater ability in his work in regard to salary and benefits.
         Wife, being self-employed, has had fluxuating (sic)
         income, although historically Wife’s income has been
         similar to but slightly less than Husband’s. Wife however
         has no benefits offered to her given that she is self-
         employed.      The parties were fortunate through the
         marriage to have acquired significant assets and not
         accrue significant debt. . . .

         Both parties have their primary source of income being
         their full-time employment.     The significant difference
         between the parties is the benefits that Husband is able to
         receive through his employment. While Wife has managed
         to acquire two IRA accounts, Husband has available paid
         vacation, a 401(k), multiple pensions and stock options,
         as well as medical insurance. Wife currently is covered
         under Husband’s medical insurance, however after a
         divorce decree is granted Wife will have to obtain her own
         insurance or pay the figure of $609.00 per month under
         COBRA.

Master’s Report & Recommendation at 10-11.           We discern no abuse of

discretion. See Reber, 42 A.3d at 1134.

      Fourth, Husband claims the court erred “in determining that [Wife] is

automatically entitled to a reduction of the value of marital real estate for

realtor’s fees and commission pursuant to 23 Pa.C.S. § 3502(a)(10.2).”

Husband’s Brief at 15. Husband avers that he “strongly disagrees with this

interpretation of the statute.”   Id.   He explains that the parties stipulated


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that Wife will receive three properties, and points out that Wife testified she

has “no intention to ever sell or liquidate any of the properties.” Id. at 16.

      In Balicki v. Balicki, 4 A.3d 654 (Pa. Super. 2010), the trial court

reduced the marital value of the husband’s insurance agency to account for

tax ramifications and expenses of sale. Id. at 657. On appeal before this

Court, the wife argued that “the tax ramifications and expenses of sale can

only be considered if [the husband] is likely to sell the marital interest in the

insurance agency.” Id. at 663. This Court rejected wife’s argument:

         This theory violates the clear directive from the legislature
         to consider the tax ramifications and expense of sale,
         which “need not be immediate and certain.” The Source
         and Official Comment to 23 Pa.C.S. § 3502(a)(10.1)
         explain its history and leave no doubt [a h]usband’s tax
         ramifications are relevant, where a sale is likely or not.

            [Previously, trial courts] have required tax ramifications
            to be immediate and certain in order for them to be
            considered in equitable distribution. New subsection
            (a)(10.1) seeks to change this interpretation by making
            clear that tax ramifications are relevant and need not
            be immediate and certain.

         It is crystal clear that the Legislature intended to stop the
         practice of the lower courts analyzing the prospect of sale
         of an asset . . . . We believe the Legislature intends the
         assets simply be given the value they would have at
         distribution after deducting every expense necessary to
         achieve liquidation. Since the language in the Divorce
         Code concerning the immediacy and certainty of the
         expense of sale is identical, it also is relevant.
Id. at 663-64 (Pa. Super. 2010) (alteration omitted).

      Contrary to Husband’s claim, the court did not hold that Wife was

“automatically” entitled to a reduction of the value of the marital property.



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See Husband’s Brief at 15. Instead, the master reduced the marital value of

the properties after consideration of Balicki and testimony that Wife has no

immediate plans to sell the properties.

            Wife has argued that real estate to be awarded to Wife
         should be reduced by the costs of transfer and sale of said
         real estate. Specifically Wife wants said values to be
         reduced by 7%, six percent (6%) being attributed to a
         realtor’s commission and one percent (1%) being one-half
         of the transfer tax (transfer tax is typically a total of 2%,
         however parties to a transaction will split that equally
         between buyer and seller). Both Husband and Wife agree
         that the 6% realtor’s commission and 1% transfer tax are
         standard in real estate transactions. Wife argues that
         pursuant to 23 Pa.C.S.A. § 3502(a)(10.2) which indicates
         the expense of the sale, transfer or liquidation associated
         with a particular asset, which expense need not be
         immediate and certain.          (emphasis added) Husband
         disagrees with reducing Wife’s real estate considerations
         by these amounts and cites to the case of Balicki v.
         Balicki, 4 A.3d 654 (Pa. Super. 2010). Husband stresses
         that the Divorce Code does not make a deduction for
         expenses of sale mandatory. Husband cites to the Balicki
         decision to support this claim.

             In reviewing the Superior Court’s decision in Balicki,
         the Court actually encourages the deduction for the
         expenses of the sale of assets. The Court states “We
         believe the legislature intends the assets simply to be
         given the value they would have at distribution after
         deducting every expenses necessary to achieve liquidation.
         . . .” See id. at 664. After analyzing the tax ramifications
         and expense of sale associated with the marital interest in
         an insurance agency, the Court in Balicki indicated that
         deducting the expenses of sale is a fair and just method
         for valuing said agency. See id.

            While the Master understands that it is not
         mandatory that the expenses of sale be deducted,
         and further recognizes that there was no testimony
         of immediate sale in this matter, the language of the
         statute as well as the Court’s decision in Balicki


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         favor a reduction of 7% in this situation. One key
         distinction needs to be noted however regarding the
         positions of the parties in applying the 7% reduction in
         that it is recommended that this be given to all real estate
         and [marital] components of real estate of all parties. . . .

Master’s Report & Recommendation at 18-20 (emphasis added). We agree.

See Balicki, 4 A.3d at 663-64.

      Fifth, Husband argues the trial court erred in awarding Wife alimony

based upon the statutory factors in 23 Pa.C.S. § 3701(b)(1) through (17)

and avers that the statute militates against an award of alimony. Husband’s

Brief at 19-23. He claims that “[a]s per the stipulations of the parties, both

parties, especially [Wife], will have more than sufficient assets and minimal

liabilities to cover their needs moving forward.” Id. at 21.

      This Court has stated:

         Our standard of review regarding questions pertaining to
         the award of alimony is whether the trial court abused its
         discretion.    We previously have explained that “[t]he
         purpose of alimony is not to reward one party and to
         punish the other, but rather to ensure that the reasonable
         needs of the person who is unable to support himself or
         herself through appropriate employment, are met.”
         Alimony “is based upon reasonable needs in accordance
         with the lifestyle and standard of living established by the
         parties during the marriage, as well as the payor’s ability
         to pay.” Moreover, “[a]limony following a divorce is a
         secondary remedy and is available only where economic
         justice and the reasonable needs of the parties cannot be
         achieved by way of an equitable distribution award and
         development of an appropriate employable skill.”

Teodorski v. Teodorski, 857 A.2d 194, 200 (Pa. Super. 2004) (citation

omitted).



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     Pursuant to Section 3701(b), the court considers the following factors

in determining whether to award alimony either for a definite or indefinite

period:

          (1) The relative earnings and earning capacities of the
          parties.

          (2) The ages and the physical, mental and emotional
          conditions of the parties.

          (3) The sources of income of both parties, including, but
          not limited to, medical, retirement, insurance or other
          benefits.

          (4) The expectancies and inheritances of the parties.

          (5) The duration of the marriage.

          (6) The contribution by one party to the education, training
          or increased earning power of the other party.

          (7) The extent to which the earning power, expenses or
          financial obligations of a party will be affected by reason of
          serving as the custodian of a minor child.

          (8) The standard of living of the parties established during
          the marriage.

          (9) The relative education of the parties and the time
          necessary to acquire sufficient education or training to
          enable the party seeking alimony to find appropriate
          employment.

          (10) The relative assets and liabilities of the parties.

          (11) The property brought to the marriage by either party.

          (12) The contribution of a spouse as homemaker.

          (13) The relative needs of the parties.




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           (14) The marital misconduct of either of the parties during
           the marriage. The marital misconduct of either of the
           parties from the date of final separation shall not be
           considered by the court in its determinations relative to
           alimony, except that the court shall consider the abuse of
           one party by the other party. As used in this paragraph,
           “abuse” shall have the meaning given to it under section
           6102 (relating to definitions).

           (15) The Federal, State and local tax ramifications of the
           alimony award.

           (16) Whether the party seeking alimony lacks sufficient
           property, including, but not limited to, property distributed
           under Chapter 35 (relating to property rights), to provide
           for the party's reasonable needs.

           (17) Whether the party seeking alimony is incapable of
           self-support through appropriate employment.

23 Pa.C.S. § 3701(b)(1)-(17).

      Instantly, the master addressed all of the Section 3701 factors and

concluded Wife was entitled to an award of alimony based upon the following

factors:    Husband has a steady income, while Wife’s income fluctuates.

Master’s Report & Recommendation at 25.          “Further, because she is self-

employed, Wife does not have the benefit of the safety net through

employer benefits that are offered to Husband.” Id. “Wife . . . will need to

purchase her own health insurance.”       Id. at 26.   “”Wife has testified that

through COBRA she would need to pay $609.00 per month for insurance. . .

. Given the considerable size of this expense this would make a significant

financial impact on Wife.” Id. at 29 (citation to record omitted).




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      Furthermore, a review of the record belies Husband’s assertion that

“[a]s per the stipulations of the parties, both parties, especially [Wife], will

have more than sufficient assets and minimal liabilities to cover their needs

moving forward.” See Husband’s Brief at 21 (emphasis added). In support

of this averment, Husband cites the master’s report and recommendation at

page 27 which states: “As was discussed under equitable distribution and as

set forth on schedules A and B attached hereto, the parties have acquired

significant assets while avoiding accrual of substantial debt.” See Master’s

Report & Recommendation at 27. Schedule A lists the assets to be awarded

to Husband and Wife pursuant to the 55%/45% distribution.                Id. at

Schedule A. Schedule B reflects the marital debt. Id. at Schedule B. Wife’s

debt totaled $25,393.04 and Husband’s debt was $5,867.18.           The Master

averred: “The parties have stipulated to the values and ownership of most of

the assets in this matter. The parties were fortunate to be able to acquire a

number of assets without the accrual of significant debt. Following equitable

distribution each party will be in possession of a substantial number of

assets.” Id. at 28-29.

      The master found:

         While Husband is correct there are some costs associated
         with the health insurance and that the percentage of
         employer contribution to pensions have gone down, he still
         maintains a more favorable position because these benefits
         are offered through his employment, while Wife has no
         such benefits being self-employed. Additionally once the
         parties are divorced, Wife, who has been covered under
         Husband’s health insurance plan, will need to purchase her


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        own health insurance.    This will create an additional
        expense to Wife thus reducing the amount of income she
        has available to her.

Id. at 25-26. The master concluded, “The parties have acquired significant

assets which will be distributed through equitable distribution, in addition

while Wife is at somewhat of a disadvantage due to not have as many

benefits as Husband, this is remedied through the awarding of alimony to

Wife.” Id. at 30. We discern no abuse of discretion. See Teodorski, 857

A.2d at 200.

     Order affirmed.

     Olson, J. concurs in the result.

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary

Date: 8/13/2014




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