#26242-a-GAS

2012 S.D. 72

                             IN THE SUPREME COURT
                                     OF THE
                            STATE OF SOUTH DAKOTA

                                    ****

NICOLE A. HAGEDORN,                          Plaintiff and Appellee,

      v.

MICHAEL G. HAGEDORN,                         Defendant and Appellant.


                                    ****

                  APPEAL FROM THE CIRCUIT COURT OF
                     THE SECOND JUDICIAL CIRCUIT
                  MINNEHAHA COUNTY, SOUTH DAKOTA

                                    ****

                THE HONORABLE KATHLEEN K. CALDWELL
                               Judge

                                    ****
VICTORIA M. DUEHR of
Bangs, McCullen, Butler,
 Foye & Simmons, LLP
Sioux Falls, South Dakota                    Attorneys for plaintiff
                                             and appellee.

GREGORY T. BREWERS of
Strange, Farrell, Johnson
 & Brewers, PC
Sioux Falls, South Dakota                    Attorneys for defendant
                                             and appellant.


                                    ****
                                             CONSIDERED ON BRIEFS
                                             ON AUGUST 27, 2012

                                             OPINION FILED 10/17/12
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SEVERSON, Justice

[¶1.]        Nicole and Michael Hagedorn were married for 15 years and had two

daughters. In December 2010, Nicole filed for divorce on the grounds of extreme

cruelty and adultery. The trial court granted Nicole a divorce on those grounds and

awarded her alimony of $5,000 per month and attorney fees. Michael appeals the

awards of alimony and attorney fees. We affirm the trial court.

                                  BACKGROUND

[¶2.]        Nicole and Michael Hagedorn married in Brookings, South Dakota, on

August 10, 1996. Prior to their marriage, Nicole and Michael dated for several

years while Michael attended South Dakota State University in Brookings. On

March 25, 1993, Nicole gave birth to the couple’s oldest daughter. Nicole and

Michael’s second daughter was born on April 29, 2005. Both Nicole and Michael are

currently in their early 40s and in good health.

[¶3.]        Michael earned a bachelor’s of science degree in economics and

business from South Dakota State University. After completing his degree in 1995,

he worked in Minnesota before returning to Sioux Falls to work for Norwest Bank.

He began working for Central Billing Incorporated (CBI) in early 1998, selling and

servicing cash registers and point of sale systems. In 1999, he purchased the

business for $27,500. Michael paid for the purchase with loans from his father and

a bank. He paid both his father and the bank back within six months of the

purchase. The business grew as Michael expanded available product lines, added

services, and marketed the company throughout the region. In addition, at the time

of trial, Michael worked on a contract basis for Sprint/MBO Partners providing


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technical support services at the Communication Service for the Deaf Relay

Services location in Sioux Falls.

[¶4.]        Nicole earned an applied associate of science degree from Killian

Community College in Sioux Falls. After receiving her degree, she sought work as a

legal assistant, but was unsuccessful. She found full-time employment as a

mailroom clerk, then a receptionist, and then a flexible benefits claims processor at

Sanford Health in Sioux Falls. Nicole worked at Sanford for over five years before

she and Michael decided that it would be better for the family and the business if

Nicole worked at CBI. Nicole began working full-time as an administrative

assistant at CBI and continued working there until early 2011.

[¶5.]        Throughout their marriage, Michael and Nicole disagreed about

Michael’s drinking habits. Michael frequently spent time on the weekends drinking

with friends and family. Nicole testified that when Michael was drinking he was

verbally abusive and called her a variety of derogatory names.

[¶6.]        Beginning in the summer and early fall of 2009, Nicole and Michael

lived separately. When Michael lived in the family’s cabin at Lake Madison, Nicole

lived with their daughters in the family’s Sioux Falls residence. The parties

switched locations during the summer of 2010 and switched back for the school

year. Michael also rented an apartment in Sioux Falls for a period of time. During

the separation, Michael began dating a family friend. His relationship with the

woman continued off and on through June 2011. Additionally, Michael admitted to

Nicole that he was having a relationship with another woman in early 2010.




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[¶7.]          In December 2010, Nicole filed for divorce. A trial was held from

September 27 through 29, 2011. At trial, the most significant issues were alimony

and division of property. Nicole and Michael agreed that Michael would retain

ownership of CBI. CBI produced between $215,000 and $276,000 of income per

year in the last three years for the family, though these figures also include

Michael’s income from his work for Sprint/MBO Partners. A vocational expert

evaluated Nicole’s earning capacity and testified at trial that she would likely earn

between $10 and $12 per hour in her future employment.

[¶8.]          Judge Caldwell awarded alimony to Nicole in the amount of $5,000 per

month for life or until she remarries. This award was slightly less than Nicole’s

projected budget of $5,135 per month. Judge Caldwell also awarded attorney fees

and costs, totaling $14,419.43, to Nicole. Michael appeals the judgment of alimony

and attorney fees. Michael argues that the awards are an abuse of discretion by the

trial court.

                              STANDARD OF REVIEW

[¶9.]          The standard of review for alimony determinations and awarding

attorney fees in divorce cases is abuse of discretion. Dejong v. Dejong, 2003 S.D. 77,

¶ 5, 666 N.W.2d 464, 467; Voelker v. Voelker, 520 N.W.2d 903, 908 (S.D. 1994)

(citing Ryken v. Ryken, 461 N.W.2d 122, 128 (S.D. 1990); Garnos v. Garnos, 376

N.W.2d 571, 574 (S.D. 1985)). The trial court’s findings of fact are not set aside

“unless they are clearly erroneous.” Dejong, 2003 S.D. 77, ¶5, 666 N.W.2d at 467

(citing Keller v. Keller, 2003 S.D. 36, ¶8, 660 N.W.2d 619, 622).




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                                    DISCUSSION

[¶10.]       1.     Whether the trial court abused its discretion by awarding
                    alimony in the amount of $5,000 per month for life.

[¶11.]       The party requesting alimony has the burden to “‘establish that they

have a need for support and that their spouse has sufficient means and abilities to

provide for part or all of that need.’” Anderson v. Anderson, 2002 S.D. 154, ¶ 12, 655

N.W.2d 104, 107 (quoting Urban v. Urban, 1998 S.D. 29, ¶7, 576 N.W.2d 873, 875).

The trial court should consider a number of factors to determine a party’s need for

alimony and the amount and duration of alimony. Id. These factors are “(1) [the]

length of the marriage; (2) [the] respective earning capacity of the parties; (3) their

respective age, health and physical condition; (4) their station in life or social

standing; and (5) relative fault in the termination of the marriage.” Id. ¶ 12, at 107

(citing Urban, 1998 S.D. 29, ¶ 8, 576 N.W.2d at 875; Christians v. Christians, 2001

S.D. 142, ¶ 16, 637 N.W.2d 377, 381).

[¶12.]       Here, the trial court found a variety of factors to support the award of

$5,000 per month to Nicole. Nicole and Michael were married for 15 years, though

they had a relationship for almost 20 years. The trial court also considered the

earning power of both Nicole and Michael. The parties agreed that Michael would

receive the family business. Michael’s earning capacity, including CBI and his work

with Sprint/MBO Partners, is around $19,000 per month. Nicole’s earning capacity

is between $10 and $12 per hour. Nicole testified that, because of her age, she is

unlikely to return to school to gain additional education or skills. In addition, the

trial court found that both Nicole and Michael are in their early 40s and in good

health and physical condition. The trial court also found that the parties lived a

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middle-class lifestyle and Nicole’s social standing or station in life would decline

without alimony. Finally, the trial court granted the divorce to Nicole on the

grounds of extreme cruelty and adultery, finding Michael at fault.

[¶13.]       Michael argues that the trial court erred because the alimony award

pays all of Nicole’s budgeted expenses and would allow her to sit idle. The trial

court found that Nicole’s budget of $5,135 per month was reasonable and justified to

maintain the standard of living she had throughout the marriage. After taxes are

paid on the monthly alimony, Nicole will have just under $4,200 for her expenses.

After taxes are paid and alimony is taken out of Michel’s monthly income, he will

have almost $9,800 for his expenses.

[¶14.]       Michael cites to the Wallahan case for the proposition that alimony

should not be awarded in an amount that would allow a spouse who can work to

“‘sit in idleness.’” Wallahan v. Wallahan, 284 N.W.2d 21, 27 (S.D. 1979) (quoting

Guindon v. Guindon, 256 N.W.2d 894, 898 (S.D. 1977)). In Wallahan, we stated

that alimony will not be provided in an amount that would “allow a wife capable of

work to sit in idleness.” Id. (internal quotation marks omitted). However, neither

will alimony be denied because a wife may “obtain employment and support

herself.” Id. (internal quotation marks omitted). The trial court found that Nicole

has not been idle. She has sought employment since ending her employment at CBI

and made a good faith effort to obtain a position.

[¶15.]       The trial court properly considered the factors above in making an

alimony award to Nicole. In particular, the trial court considered Michael’s monthly

income, the fact that he would receive the primary income producing asset, Nicole’s


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employment prospects, and current economic conditions. Considering the evidence

in the record, the findings of fact, and conclusions of law of the trial court, we

cannot say that the trial court abused its discretion in awarding alimony to Nicole

in the amount of $5,000 per month for life or until she remarries.

[¶16.]       2.     Whether the trial court abused its discretion by awarding
                    $14,419.43 for attorney fees.

[¶17.]       Allowing an award for attorney fees is within the discretion of the trial

court. Voelker, 520 N.W.2d at 908. A trial court should consider a number of

elements to determine whether and in what amount attorney fees should be

awarded. Id. The elements include:

             (1) The amount and value of the property involved, (2) the
             intricacy and importance of the litigation, (3) the labor and time
             involved, (4) the skill required to draw the pleadings and the
             drawing of the cause, (5) the discovery procedures utilized, (6)
             whether there existed complicated legal problems, (7) the time
             required to try the cause, and (8) whether written briefs were
             required.

Id. (citing Peterson v. Peterson, 449 N.W.2d 835, 840 (S.D. 1989); Garnos, 376

N.W.2d at 574-75). The trial court should also consider “the property owned by

each of the parties, their relative incomes, whether the property is in liquid or fixed

assets, and whether the actions of a party unreasonably increased the time spent on

the case.” Id. (citing Garnos, 376 N.W.2d at 575).

[¶18.]       The trial court valued and divided a variety of marital property at

trial. Nicole’s attorney submitted detailed information about her fees and the time

spent on a variety of tasks leading up to the trial. The trial took place over three

days. The trial court found that Michael had a greater income and the largest

income producing asset of the marriage, CBI. Additionally, the trial court found

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that Michael caused confusion regarding the profit and loss statements of CBI and

his other income, resulting in additional hours of work on the case.

[¶19.]       Michael argues that Nicole’s award of $14,419.43 of attorney fees is

duplicative of an earlier award of $5,000. This argument is not supported by the

record.

[¶20.]       Further, Michael argues that the award of attorney fees had no

justification. As noted above, the trial court made specific findings about the

ownership of assets and income from those assets. The trial court found that

Michael had significant income producing assets and that he had increased the time

spent on the case. These findings are specific to the factors that we require trial

courts to consider when awarding attorney fees.

[¶21.]       The trial court properly considered the factors above in making an

award of attorney fees to Nicole. In particular, the trial court considered that

Michael would receive the income producing asset and had the ability to pay for the

attorney fees. Considering the evidence in the record, the findings of fact, and

conclusions of law of the trial court, we cannot say that the trial court abused its

discretion in awarding attorney fees of $14,419.43 to Nicole.

                                   CONCLUSION

[¶22.]       The trial court did not abuse its discretion in awarding alimony or

attorney fees to Nicole. We affirm.

[¶23.]       GILBERTSON, Chief Justice, and KONENKAMP, ZINTER, and

WILBUR, Justices, concur.




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