J-S41014-16


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

MAGDALENA CEBALLOS,                                IN THE SUPERIOR COURT OF
                                                         PENNSYLVANIA
                            Appellee

                       v.

YOHENDY CEBALLOS-RAMOS,

                            Appellant                   No. 2619 EDA 2015


                  Appeal from the Order Entered July 31, 2015
                 In the Court of Common Pleas of Bucks County
                   Civil Division at No(s): A06-09-63990-D/Q


BEFORE: BENDER, P.J.E., DUBOW, J., and STEVENS, P.J.E.*

MEMORANDUM BY BENDER, P.J.E.:                         FILED AUGUST 03, 2016

        Yohendy Ceballos-Ramos (Husband) appeals from the order entered

on July 31, 2015, that granted him and Magdalena Ceballos (Wife) a divorce,

equitably divided the marital property and denied Wife’s request for alimony,

counsel fees, costs and expenses. After review, we vacate in part and affirm

in part.

        In its Pa.R.A.P. 1925(a) opinion, the court set forth the following facts:

               On March 8, 2010, the Plaintiff, [Wife], filed a complaint in
        divorce and for alimony, child support, custody, equitable
        distribution of property, counsel fees, and costs against the
        Defendant, [Husband]. The parties were separated on March 10,
        2010. The parties have three minor children, [D.C.] (born April
        [], 2002), [Y.C.] (born December [], 2003), and [Y.C.] (born
        April [], 2010), collectively “the Children.”
____________________________________________


*
    Former Justice specially assigned to the Superior Court.
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                             ....

     Upon consideration of the Report of the Master, along with the
     memoranda of law submitted by the parties and following
     multiple days of hearings, this Court hereby makes the following
     findings of fact:

           1. The Dominican Unisex Hair Salon is a marital asset
           subject to equitable distribution and is valued at
           $252,650.00;

           2. The undeveloped land in the Dominican Republic is a
           marital asset subject to equitable distribution;

           3. The Alaver bank account in the Dominican Republic was
           closed and liquidated by Husband is a marital asset subject
           to equitable distribution and is valued at $11,153.26;

           4. The La Vega Real bank account in the Dominican
           Republic is not a marital asset subject to equitable
           distribution;

           5. The 1997 Toyota Camry which was sold by Husband, is
           a marital asset subject to equitable distribution and is
           valued at $1,600.00;

           6. The escrowed down payment for the marital residence
           in Wife's possession, is a marital asset subject to equitable
           distribution and is valued at $4,300;

           7. For the child dependency tax exemption, Wife may
           claim two children per year and Husband may claim one
           child per year.

           8. The marital estate totals $269,703.00 plus the value of
           the undeveloped land in the Dominican Republic.

           9. The martial estate shall be divided as 65% to Wife and
           35% to Husband.

Trial Court Rule 1925(a) Opinion, 1/8/16, at 1-2 (footnotes omitted).




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       As a result of these findings, the court ordered Husband to pay Wife

$171,006.95 in 54 monthly installments of $3,166.00 each on the fifteenth

of each month. The court also determined that since these payments were

the equitable distribution of the marital assets, they were not taxable to Wife

and not tax-deductible to Husband; nor were they to be discharged in any

bankruptcy proceeding.1         Lastly, Wife’s claims for alimony, counsel fees,

costs and expenses were denied.

       Husband filed a timely appeal and submitted a statement of errors

complained of on appeal. He raises the following issues for our review:

       1. Did the [t]rial [c]ourt commit an abuse of discretion and an
       error of law when it failed to set forth the legal reason for the
       award of equitable distribution and after doing so it awarded
       65% of the marital estate to Wife and 35% of the marital estate
       to Husband when Husband earns only $50,000.00 per year and
       his income was reflected in the business valuation?

       2. Did the [t]rial [c]ourt commit an abuse of discretion and an
       error of law when it [o]rdered and [d]irected that Husband “buy-
       out” Wife’s interest in a business rather than [o]rder and [d]irect
       its sale when Husband is not in the financial position to pay to
       Wife a buy-out?

       3. Did the [t]rial [c]ourt commit an abuse of discretion and an
       error of law when it directed that Husband’s buy-out of equitable
       distribution was not dischargeable in bankruptcy?
____________________________________________


1
  The court further directed that the jointly owned property in the Dominican
Republic should be sold and divided 65% Wife/35% Husband. Additionally,
the escrowed down payment on the marital residence was awarded to Wife,
and Husband was awarded the Dominican Unisex Salon, the funds in the
Alaver account and the proceeds from the sale of the Toyota. See Rule
1925(a) Opinion.



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      4. Did the [t]rial [c]ourt commit an abuse of discretion and an
      error of law in directing that Husband is entitled to claim only
      one child for income tax purposes and Wife is entitled to claim
      two of the three children when Husband’s income is higher than
      Wife’s income?

Husband’s brief at 6.

      We review an equitable distribution order for an abuse of
      discretion. Biese v. Biese, 979 A.2d 892, 895 (Pa. Super.
      2009).

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

      Id. (internal citations and quotations omitted).

Reber v. Reiss, 42 A.3d 1131, 1134 (Pa. Super. 2012).            Moreover, it is

within the province of the trial court to weigh the evidence and decide

credibility and this Court will not reverse those determinations so long as

they are supported by the evidence.       Sternlicht v. Sternlicht, 822 A.2d

732, 742 (Pa. Super. 2003), aff’d, 876 A.2d 904 (Pa. 2005).

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      With regard to Husband’s first issue, he asserts that the court in its

July 31, 2015 decree did not set forth the reasons for the ordered

distribution or the percentage of distribution for each asset. Husband does

acknowledge that the trial court rectified this error in its Rule 1925(a)

Opinion and discussed the factors relating to the division of marital property

as enumerated in 23 Pa.C.S. § 3502. See also 23 Pa.C.S. § 3506 (stating

“the court shall set forth the percentage of distribution for each marital asset

or group of assets and the reason for the distribution ordered”). However,

Husband claims that some of the court’s findings and the basis for its

conclusions are not supported by evidence in the record.

      Specifically, Husband argues that testimony presented at trial, which

the court overlooked, shows that the hair salon was acquired in April of

2011, after the parties separated, and that he had a 50% partner. He also

claims that Wife’s testimony about her health issues, found relevant by the

court, were not supported by any medical testimony or documentation.

Further, Husband claims that no testimony was presented showing that

Wife’s health issues affected her earning capacity. Husband also contends

that the court’s emphasis on the fact that because Wife is a United States

citizen, “Husband [is] able to gain continuing access to the United States,”

should not factor strongly in Wife’s favor. Rather, he claims that “he works

based upon his own education, and training as a barber.” Husband’s brief at

14. Thus, Husband again argues that this finding is not supported by the

record.   Moreover, he notes that the Master recognized that the business

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provides Husband with income “as reflected in the business evaluation,” and

that, therefore, the value of the salon should be equally divided with 60% of

the balance of the assets going to Wife. Id. at 15.

      Following its discussion of all the relevant factors listed in section

3502, the court explained its reasoning generally as follows:

            To summarize, this Court found three factors highly
      compelling in Wife’s favor: (1) through Wife, Husband was able
      to gain continuing access to the United States, and, prior to the
      marriage, Husband had no financial or business prospects in the
      Dominican Republic; (2) Wife works part-time at Produce
      Junction, where her hours are set based on the needs of her
      employers; and (3) during the course of the marriage, Husband
      was the wage earner, and Wife was the homemaker. All other
      factors either skewed slightly in Wife’s favor or did not favor
      either party.

             If one considers each [of] these factors worth five
      percentage points each [sic] over the basic fifty-fifty split, the
      division would be 65% for Wife and 35% for Husband. Also,
      65% is the average of the parties[’] proposed percentages—i.e.,
      the mean of 55% and 75% is 65%. Thus, this [c]ourt properly
      concluded that the martial property should be distributed 65% to
      Wife and 35% to Husband, and, therefore, did not commit an
      abuse of discretion nor an error of law. Accordingly, the first
      issue raised by Husband on appeal is meritless.

Rule 1925(a) Opinion at 8-9 (footnotes omitted).        Moreover, the court

provided an extensive discussion about the salon’s acquisition, stating:

            The Dominican Unisex Hair Salon (“the Salon”) is a barber
      shop and beauty parlor with ten barber chairs located at 605
      West Marshall Street, Norristown, Montgomery County,
      Pennsylvania.    The Salon was opened in 2007, when the
      marriage was still intact. Husband has been employed in the
      Salon since that date.

            In 2007, Husband had sold his business interest in his
      previous salon, Rainy Day People; this sale is not contradicted.

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     Wife testified that, while she and Husband were looking for a
     location to open the Salon, she had ordered materials and items
     for the new business. Not knowing where the new shop would
     be located, she had the items delivered to Rainy Day People,
     since Husband intended immediately to open his new business
     after closing his previous one. This testimony is corroborated by
     a receipt for the salon material[] items that were delivered to
     Rainy Day People.

            A letter was submitted to this Court signed by Husband
     and notarized on October 21, 2009, stating that he purchased
     the business two years before and put the shop in his sister’s
     name, because he did not have a barbershop license. The letter
     continues that he wanted the lease of the Salon put in his and
     Wife’s names and reaffirms that “[t]his business never really
     belonged to [his sister] and for this reason [he] would like to
     officially make the change.” During his testimony, Husband
     contended that he was tricked into signing this admission, that
     he did not understand the letter when he signed it, as he does
     not speak nor read English well, and that the letter was merely
     intended to be used to acquire health insurance for the Children.
     However, this [c]ourt did not find his testimony credible.

            Husband also claimed that he now only owns a 50% share
     of the business and that the remainder of the business is owned
     by Dominga Antonia Solares.        Husband stated that he and
     Solares paid $25,000.00 to his sister, Rosey Delgado, for the
     business, in 2011, after his separation from Wife. He added that
     Solares gave him $15,000.00 in cash to pay Delgado and has
     since contributed $17,500.00 toward improvements. Husband
     continued that he paid $10,000.00 to Delgado in four
     installments: three installments of $3,000.00, and one final
     payment of $1,000.00. Husband contended that the monthly
     profits of the business are halved between himself and Solares.

           Nevertheless, in 2011, Husband filed a Schedule C tax
     form for the Salon, which is to be used for a sole proprietorship
     only. Solares does not cut hair and is not employed by the
     business. Husband provided no documentation to support any
     involvement in the Salon by Solares.

           Husband also presented Delgado as a witness in an
     attempt to establish that the Salon was not his during the
     marriage but was sold to him subsequently by Delgado. This

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       [c]ourt also did not find Delgado's testimony to be credible.
       Delgado submitted no documentation, receipts, or other
       evidence of the sale. However, a letter signed by Husband was
       submitted which stated that he had Delgado sign the lease for
       the Salon's location. Moreover, Wife presented receipts from
       2007 and 2008 for business purchases for the Salon.

             The report of Husband’s own expert, Joseph Egler, further
       indicated that the Salon was marital property. The business
       evaluation stated: "[The Salon] was started in 2007.          Mr.
       Ceballos initially ran the business under his sister's name. This
       was done because he did not have a barber's license. In a letter
       dated October 21, 2009, Mr. Ceballos claimed 100 percent
       ownership of [the Salon].

             Thus, based on the above facts, this [c]ourt found that the
       Salon was marital property and was purchased and controlled by
       Husband prior to the parties’ final separation. This [c]ourt also
       correctly concluded that Husband has 100% ownership of the
       Salon, as there is no evidence to support the ownership or
       control of the business by Solares or anyone else.

Id. at 9-11 (footnotes omitted). Thus, the court’s conclusion that the salon

was marital property and available for distribution is supported by evidence

of record.2    Accordingly, based upon the court’s findings, conclusions and

credibility determinations, we conclude that Husband’s first issue is without

merit.

       Husband’s second issue concerns the court’s directive that Husband

pay to Wife $171,006.95 in fifty-four monthly installments to buy out Wife’s


____________________________________________


2
   As for Husband’s argument about Wife’s health and its effect on her
earning capacity, as well as the impact of Wife’s citizenship on Husband’s
ability to remain in the United States, Husband did not include these issues
in his Rule 1925(b) statement of errors and we resolve that they have been
waived. See Pa.R.A.P. 1925(b)(4)(vii).



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interest in the salon.   He claims that he is financially incapable of making

these payments and that the court should have directed that the salon be

sold, not just that he buy out her interest. The court addressed this issue by

stating:

      The fourth issue raised by Husband on appeal is: “Did the [t]rial
      [c]ourt abuse its discretion and commit an error of law in
      ordering Husband to buy-out Wife’s interest in the Business
      known as Dominican Unisex Salon as the [o]rder does not
      provide for the sale of the business thereby compelling Husband
      to maintain a marital asset. Husband received “[a]ll right, title
      and interest” in the Salon. He may do with it whatever he
      wants, including sell it, provided he pays to Wife the sum of
      $171,006.95. He is not “compel[led] … to maintain a marital
      asset.”

Id. at 13 (footnote omitted). Based upon this clarification by the court, we

conclude that Husband’s second issue is without merit.

      Husband’s third issue relates to the court’s directive that Husband pay

to Wife $171,006.95, as equitable distribution payments.          Specifically,

Husband takes issue with the court’s indication that these payments cannot

be discharged in any bankruptcy action. Husband relies on Hogg v. Hogg,

816 A.2d 314 (Pa. Super. 2002), for the proposition that a state court does

“not have the authority to reaffirm [h]usband’s [p]roperty [s]ettlement

[a]greement based on [s]tate equitable principals where the debts have

been discharged by the [b]ankrupcy [c]ourt, as the statute mandate[s] that

the request to hold a debtor spouse to the obligations could be litigated only

in [f]ederal [b]ankrupcy [c]ourt.” Husband’s brief at 16-17.




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      Initially, we note that the situation in Hogg and the one presently

before us are different.     In Hogg, we directed that the state court was

without authority to “reaffirm” the husband’s debts, resulting from a

property settlement agreement that had previously been discharged in

bankruptcy. Here, the trial court’s order essentially provided that if at some

future time Husband sought relief in a bankruptcy proceeding, any debts

remaining that involved the sums he owed Wife as a result of the equitable

distribution award could not be discharged in bankruptcy.            Obviously,

Husband contends that the court could not set forth such a directive.

Essentially, the issue is one of jurisdiction.

      The Hogg Court provided the following explanation:

            Traditionally, the Bankruptcy Code has protected non-
      debtor spouses and children by precluding discharge of a debtor
      spouse's alimony and support obligations.         11 U.S.C. §
      523(a)(5).     However, obligations of a debtor spouse that
      emanated from provisions of property settlement agreements
      not directed at support or alimony were discharged as a matter
      of course. But in 1994, the Bankruptcy Code was amended and
      a new subsection was added to address those marital obligations
      that were not for alimony or support, i.e., debts incurred as a
      result of a property settlement agreement. The new provision
      deemed such debts non-dischargeable unless 1) the debtor could
      not afford to pay them or 2) discharging the debt would result in
      a benefit to the debtor that outweighed the detrimental
      consequences to the non-debtor spouse.            11 U.S.C. §
      523(a)(15).

             Although § 523(a)(15) is viewed as weak protection for the
      non-debtor spouse, its intended purpose was to “prevent a
      debtor spouse from obtaining a discharge of debts arising from
      certain property settlement agreements.” However, there are
      explicit procedural rules that govern § 523(a)(15), as well as
      jurisdictional restraints that apply to the provision. For instance,


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      while § 523(a)(15) offers protection to the non-debtor spouse
      with a settlement agreement, the Code nonetheless places the
      burden on the non-debtor spouse to seek the provision’s
      protection and to do so in a specific manner. Thus, the non-
      debtor spouse who wishes to retain the benefit of a settlement
      agreement is required to raise the issue in an adversary
      proceeding in the Bankruptcy Court within sixty days of the first
      date set for the meeting of creditors. Unlike in the context of
      alimony and support, “the onus is on the nondebtor party to
      promptly raise and prevail on the issue of nondischargeability
      when it comes to property settlement agreement debts.”
      Further, only the Bankruptcy Court judge has jurisdiction
      to decide whether and to what extent a settlement
      agreement debt may be deemed nondischargeable. This
      too is unlike alimony and support debts, jurisdiction over which
      is shared by the federal bankruptcy court and the state divorce
      court.

            It is clear that as a result of material, substantive changes
      in the Bankruptcy Code, a domestic relations lawyer
      representing a non-debtor spouse must intervene in the debtor
      spouse's bankruptcy proceedings in order to represent his or her
      client zealously. While the prospect of entering the federal
      bankruptcy court maze is daunting, the new provisions set out
      above make the task mandatory.

Hogg,    816   A.2d   at   318-19   (emphasis    added;   citations   omitted).

Accordingly, we are compelled to conclude that the trial court did not have

jurisdiction to direct that any debts arising out of the equitable distribution

award could not be discharged in bankruptcy. Thus, that portion of the trial

court’s order is null and void. Accordingly, Husband’s third issue does have

merit and the portion of the court’s decree and order, stating that “[t]hese

payments shall not be dischargeable in any bankruptcy action” is vacated.

      Husband’s last issue concerns the award of the dependency exceptions

for income tax purposes.      The court ordered that Wife may claim two

children per year, while Husband was entitled to claim one child per year.


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Husband acknowledges that pursuant to 26 U.S.C. § 152(e)(1), the parent

with primary custody is entitled to claim the dependency exemption, but that

a trial court may “modify that determination based upon an equitable

distribution and an entry of child support.” Husband’s brief at 17. Husband

relies on Miller v. Miller, 744 A.2d 778 (Pa. Super. 1999), wherein this

Court held “that state courts may use their equitable powers to allocate the

dependency exemption to non-custodial parent.”       May v. May, 837 A.2d

566, 569 (Pa. Super. 2003) (quoting Miller, 744 A.2d at 785). Moreover,

the May opinion noted that the Miller Court opined that “[t]he primary

purpose of this allocation is to maximize the income available for the support

of the minor children.” May, 837 A.2d at 569 (quoting Miller, 744 A.2d at

785).

        Essentially, Husband argues that if he were awarded the dependency

exemptions, his net income would increase and, therefore, more income

would be available for child support. The trial court explained the basis for

its determination, first noting that treasury regulation 1.152-4 relies on

custody and that since Wife has primary physical custody of the Children,

she would be entitled to claim all three. Thus, by allowing Husband to claim

one child each year, the court reasoned that “Husband is receiving the tax

exemption for one more child than he otherwise would under the standard

[t]reasury [r]egulation, without this [c]ourt’s intervention.”   Rule 1925(a)

Opinion at 14. The court also explained that Husband proposed that each

party should claim one child and that they should alternate claiming the

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youngest child, while Wife proposed the plan that was adopted by the court.

Neither party nor the trial court directed this Court to specifics relating to

actual calculations of each parties’ income and its availability for support.

Accordingly, we conclude that the court did not abuse its discretion in

awarding the exemptions as it did, and Husband has not convinced us

otherwise.

      Order vacated in part and affirmed in part. Jurisdiction relinquished.

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 8/3/2016




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