Divorce; Classification of property as a separate asset; Distribution of separate property; MCL 552.401; Marital property distribution; Berger v Berger

The court held that the trial court did not clearly err in classifying a parcel of real property (the northern farm parcel) as a separate asset and awarding it to defendant-ex-husband (Charlie). It also found no clear error in the distribution of the marital property except as to the parties’ household items and furnishings. The “trial court failed to clearly explain its decision to award Charlie the personal property that remained in the marital home[.]” Thus, the court reversed and remanded for further proceedings on that issue but otherwise affirmed the divorce judgment. As to the classification of the northern farm parcel, the court noted that while the parties had a joint interest in it, “Charlie acquired his interest in the Switzer farm before the parties married, members of the Switzer family encumbered the northern farm parcel in an attempt to discourage future conveyances, the parties never resided on the northern farm parcel, and Charlie performed the majority of the farm labor on the” parcel during the marriage. The issue thus became “whether the trial court clearly erred by declining to distribute the northern farm parcel as a separate asset.” Plaintiff-ex-wife (Christine) “testified that she contributed to the improvement of the” parcel in various ways. Charlie testified that she overstated her contributions. The court was “not left with a definite and firm conviction that the trial court inequitably awarded the northern farm parcel to Charlie. The record reflects that Charlie’s contributions to the northern farm parcel significantly outweighed Christine’s. And to the extent that the trial court based its determination on the credibility of the witnesses, it is entitled to special deference.” The court noted that “the parties agreed that they maintained separate bank accounts throughout all but the beginning of their marriage. And Charlie testified that he improved the northern farm parcel using funds from his personal bank account. He also stated that he made recent improvements to the northern farm parcel using funds he withdrew from his 401(k) retirement account.” The court further noted that they were each awarded their bank accounts and 401(k) retirement accounts. As to the marital property distribution, the court found that the “decision to award Charlie the property that remained in the marital home was a significant departure from a congruent distribution” that required explanation.