In Stephens v. Stephens, (297 Neb. 188) the Supreme Court of Nebraska tried to sort out millions of dollars in assets.
In this case, the husband owns 34 percent of his company’s stock. He claims that none of the almost $5 million in appreciation of his stock interest during the parties’ 25-year marriage was subject to equitable division. Janet Stephens and Robert L. Stephens were married for 24 years. For the last ten years of the marriage, Janet was disabled and unable to work. She gets SSI. She is not expected to become employable.
The husband and a partner founded a construction company back in 1971. When the Stephens married in 1991, the portion Robert owned was worth just under $300,000. At the time of the dissolution, it was worth more than $5 million dollars. There are also five other businesses that were examined. The court divided many of the Stephens’ assets between the two parties. It also awarded each one-half of the total interest in these other businesses through a transfer of ownership. Janet appealed the decree claiming the district court erred in finding that the appreciation in the value of the largest business during the marriage should be considered nonmarital.
The court says all property accumulated and acquired by either spouse during the marriage is part of the marital estate. Any given property can be a mixture of marital and nonmarital interests; part of an asset can be marital property while another portion can be separate property. Therefore, the original value of an asset may be nonmarital, while all or some portion of the earnings or appreciation of that asset may be marital. Applying that rule here, accrued earnings or appreciation of nonmarital assets during the marriage are presumed marital unless the party seeking the classification of the growth as nonmarital proves the growth is readily identifiable and traceable to the nonmarital portion of the account and the growth is not due to the active efforts of either spouse.
The Court said the construction company should not have been withheld from the marital estate. Therefore that portion of the decree is reversed and remanded. The Court also found the lower court did not abuse its discretion in awarding Janet 120 months of maintenance—it was statutorily warranted. However, with the change in the marital estate, the Supreme Court said the lower court can reconsider that amount in light of the change in assets. The Supreme Court also affirmed the transfer of ownership in the other businesses in lieu of a cash award.
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