Delby B. Pool, Esq.
Clarksburg, West Virginia
Attorney for the Appellant
Douglas A. Cornelius, Esq.
Clarksburg, West Virginia
Attorney for the Appellee
The Opinion of the Court was delivered PER CURIAM.
1. "There are three broad inquiries that need to be
considered in regard to rehabilitative alimony: (1) whether in
view of the length of the marriage and the age, health, and skills
of the dependent spouse, it should be granted; (2) if it is
feasible, then the amount and duration of rehabilitative alimony
must be determined; and (3) consideration should be given to
continuing jurisdiction to reconsider the amount and duration of
rehabilitative alimony." Syllabus Point 3, Molnar v. Molnar, 173
W. Va. 200, 314 S.E.2d 73 (1984).
2. "W. Va. Code, 48-2-1(e)(1) (1986), defining all
property acquired during the marriage as marital property except
for certain limited categories of property which are considered
separate or nonmarital, expresses a marked preference for
characterizing the property of the parties to a divorce action as
marital property." Syllabus Point 3, Whiting v. Whiting, 183
W. Va. 451, 396 S.E.2d 413 (1990).
3. "The purpose of W. Va. Code, 48-2-13(a)(4) (1986),
is to enable a spouse who does not have financial resources to
obtain reimbursement for costs and attorney's fees during the
course of the litigation." Syllabus Point 14, Bettinger v.
Bettinger, 183 W. Va. 528, 396 S.E.2d 709 (1990).
Shelly Kiraly Kapfer appeals the final order of the
Circuit Court of Harrison County that granted her a divorce from
Louis Andrew Kapfer on the grounds of irreconcilable difference,
distributed property and awarded her alimony. On appeal, Mrs.
Kapfer contends that the circuit court awarded an inadequate amount
of alimony, failed to evaluate certain property, improperly allowed
Mr. Kapfer to recoup all principal paid on the mortgage of the
marital home after the date of separation, and failed to award her
attorney's fees. Because we agree that the circuit court erred in
some of these matters, we reverse the circuit court.
After twenty-three years of marriage, Mr. and Mrs. Kapfer
separated on October 29, 1986 and divorced on May 14, 1990 on the
grounds of irreconcilable differences.See footnote 1 During the early course
of the marriage Mrs. Kapfer worked as executive secretary, but in
1972 after the parties moved to West Virginia, Mrs. Kapfer became
a full-time homemaker. The Kapfers have no children. Mr. Kapfer
is a petroleum engineer who has worked for the same company since
May 1967. In addition to the marital home, the parties' major
asset consists of stock shares in the company for which Mr. Kapfer
The matter was heard by a family law master and her recommendations were adopted by Circuit Court of Harrison County. The circuit court awarded Mrs. Kapfer the following alimony: $2500 payable within 30 days of the order, $1200 per month for 6 months and thereafter $500 per month. Mrs. Kapfer was awarded one half of Mr. Kapfer's monthly pension benefit accrued to November 1, 1986 or about $411 per month with payments to commence in January 1992. The circuit court ordered that stock shares be divided equally but allowed Mr. Kapfer to select the stock shares to be transferred to Mrs. Kapfer. Although the circuit court ordered the marital home sold with net sale proceeds to be equally divided, Mr. Kapfer was to be reimbursed for all principal he paid on the mortgage after the date of separation. The circuit court also required each party to pay his or her own attorney's fees.
On appeal, Mrs. Kapfer alleges that the circuit court
erred in its award of alimony, failed to classify and to evaluate
certain property correctly, improperly awarded Mr. Kapfer credit
for principal paid on the marital home's mortgage after the date of
separation and failed to award Mrs. Kapfer her attorney's fees.
Mrs. Kapfer alleges that the circuit court's award of alimony was inadequate because of insufficient current income
information and that given her age and health, the circuit court
erred in granting rehabilitative alimony.
W. Va. Code, 48-2-16(b)(3) , requires that "[t]he present employment income and other recurring earnings of each party from any source. . ." be considered in determining the amount of alimony.See footnote 2 Although the parties separated on October 29, 1986,
the hearing before the family law master was not held until
February 14, 1989 and the circuit court finally adopted the family
law master's recommendations on October 22, 1990. According to the
record, Mr. Kapfer's income up to the first part of 1987 was the
only employment income information available to the family law
master and the circuit court. The record also contains Mr.
Kapfer's pay stub for February 15, 1989; however, this information
was not disclosed until a March 7, 1991 hearing before the circuit
court.See footnote 3
In addition to a salary, Mr. Kapfer apparently receives compensation from an employee stock option plan. In 1984 the parties' total income was $57,231.59; in 1985, the parties' total income jumped to $114,688 and in 1986, the parties' total income was $96,257. Mr. Kapfer's 1989 pay stub indicated that his annual salary was about $64,000. Because Mr. Kapfer's income varied depending on the stock option plan, a complete disclosure of his income is necessary to determine what income is available for alimony. To the extent that the stock from the employee stock option plan is part of the assets for distribution, the value of
the stock shares should not be considered as income in order to
avoid duplication. See infra Section II.
Mrs. Kapfer also maintains that Mr. Kapfer's deferred
compensation and credit union savings were not disclosed and were
not considered in the determination of alimony. Although these
voluntary deductions from Mr. Kapfer's income were specified in the
record, the information was not current. Because of the lack of
current financial information, we are unable to determine if the
award of alimony is inadequate and we remand this case for further
development of this issue.
Mrs. Kapfer also alleges that given her health and age,
rehabilitative alimony should not have been granted. Although Mrs.
Kapfer was awarded permanent alimony of $500 per month, she was
also awarded rehabilitative alimony to pay for retraining ($2,500)
and to support her during retraining ($1,200 per month for 6
months).See footnote 4 In Syllabus Point 3, Molnar v. Molnar, 173 W. Va. 200,
314 S.E.2d 73 (1984), we required a broad inquiry to be made
concerning rehabilitative alimony:
There are three broad inquiries that need to be considered in regard to rehabilitative alimony: (1) whether in view of the length of the marriage and the age, health, and skills of the dependent spouse, it should be granted; (2) if it is feasible, then the amount and duration of rehabilitative alimony must be determined; and (3) consideration should be
given to continuing jurisdiction to reconsider
the amount and duration of rehabilitative
See Bettinger v. Bettinger, 183 W. Va. 528, 396 S.E.2d 709, 723 (1990).
In the present case the record shows that Mrs. Kapfer was
trained and employed as an executive secretary; however, her last
employment was in 1972 and she is now 51 years old. Mrs. Kapfer
said she is willing to work and in 1989 estimated the cost of
retraining to be $4,300 for a 10 month course.See footnote 5 Although Mrs.
Kapfer is willing to return to employment, her desire and the award
of some of the retraining costs do not automatically equal an
employed person with a minimal need for support. In Bettinger at
___, 396 S.E.2d at 723, we noted that "[w]hile rehabilitative
alimony may be ideally suited to a young spouse, it is less suited
to an older person who may find his or her age a limitation in a
skilled job market."
"'Questions relating to alimony and to the maintenance and custody of the children are within the sound discretion of the court and its action with respect to such matters will not be disturbed on appeal unless it clearly appears that such discretion has been abused.' Syllabus, Nichols v. Nichols, 160 W. Va. 514, 236 S.E.2d 36 (1977)." Syllabus, Luff v. Luff, ___ W. Va. ___, 329 S.E.2d 100 (1985).
Syllabus Point 8, Wyant v. Wyant, ___ W. Va. ___, 400 S.E.2d 869
Given Mrs. Kapfer's age and health problems, we are not satisfied that the circuit court properly considered the award of rehabilitative alimony. In Molnar, we recognized that in an appropriate case the court should continue jurisdiction to reconsider the duration and amount of alimony. If on remand, the circuit court should decide that rehabilitative alimony is appropriate, the court should continue its jurisdiction to reevaluate Mrs. Kapfer's employment status after retraining.
In summary, we reverse the circuit court's alimony award
and remand the case to develop further the record on current
employment income and to reevaluate the rehabilitative alimony
On appeal Mrs. Kapfer contends that the circuit court
failed to classify and to evaluate certain property correctly.
Specifically Mrs. Kapfer maintains that the 1985 Buick should have
been classified as her separate property, that the future stock
options should have been classified as marital property and that
the stock shares were not evaluated.
In Whiting v. Whiting, 183 W. Va. 451, 396 S.E.2d 413 (1990), we noted that under W. Va. Code 48-2-32 , equitable distribution is a three step process: classification, evaluation
and division. In the present case, Mrs. Kapfer raises two
objections concerning the circuit court's classification of
property, namely the classification of an automobile as marital
property and the failure to classify certain future stock options.
In classifying property as separate or marital, the legislature has indicated a preference for classifying property as marital. In Syllabus Point 3, Whiting, we said:
W. Va. Code, 48-2-1(e)(1) (1986), defining all property acquired during the marriage as marital property except for certain limited categories of property which are considered separate or nonmarital, expresses a marked preference for characterizing the property of the parties to a divorce action as marital property.
In accord, Syllabus Point 1, Koontz v. Koontz, 183 W. Va 477, 396
S.E.2d 439 (1990).
First, Mrs. Kapfer contends that the 1985 Buick is her separate property because it was a present from her husband. Although the automobile was titled in Mrs. Kapfer's name only, Mrs. Kapfer said that she had selected the automobile in the same way that all the automobiles had been selected. Mr. Kapfer denied that the automobile was a gift to Mrs. Kapfer. Although one spouse can transfer property to the other spouse by irrevocable gift under W. Va. Code, 48-3-10 , "[i]n all instances, the burden of proof is upon the spouse who would claim the gift." Roig v. Roig, 178 W. Va. 781, 364 S.E.2d 794, 798 (1987). Based on the
conflicting testimony, we find that the circuit court's decision
that the automobile was marital property is not clearly wrong.
Second, Mrs. Kapfer alleges that the circuit court failed
to classify certain employee stock options titled to Mr. Kapfer,
thus omitting these options from the equitable distribution
process. Mr. Kapfer disclosed that he, as of the date of
separation, had the following stock options: (1) an option for
1125 shares with an acquisition date of April 4, 1988 and (2) an
option for 750 shares with an acquisition date of March 13, 1991.
Mr. Kapfer said that stock options were subject to forfeiture upon
termination of his employment and the value was dependent on market
price. Other than the brief information provided by Mr. Kapfer,
the record is silent. Indeed, neither the family law master nor
the circuit court classified these options.
Because these stock options were acquired during the parties' marriage, they should have been considered by the circuit court. Given the lack of information about the options, we are unable to determine what value they have, if any, and how much of that value should be considered marital property subject to equitable distribution. On remand the circuit court should further develop the record by expert testimony, if necessary, to determine
the value of the options and how much of that value is marital
property subject to equitable distribution.See footnote 6
Third, Mrs. Kapfer argues that the circuit court erred in failing to evaluate the stock shares in the company for which Mr. Kapfer works that were acquired by the parties during the marriage.See footnote 7 Although the circuit court equally divided the stock shares with each party to receive 1,377 shares, the circuit court allowed Mr. Kapfer to select the shares to be transferred to Mrs. Kapfer. If the costs of acquiring the company's stock shares were equal, the stock shares could be treated as a fungible item. However, in the present case, the stock shares were acquired at different times with different costs ranging from $36 per share to $45.75 per share. Because the cost or other basis is used to determine the capital gain or loss for tax purposes, stock shares with different costs have different tax consequences, which need to be considered. Mr. Kapfer alleges that the circuit court allowed him to select the stock shares to be transferred because of a
$5,100 tax he paid in 1986.See footnote 8 Other than Mr. Kapfer's allegation
of a tax adjustment, the record does not show that the potential
tax consequences for both parties were considered.
On remand, the circuit court should consider the tax
consequences in determining the division of the stock shares. If
necessary, an expert can be appointed to assist the court and if
the stock shares are no longer available, any imbalance that
resulted from the division can be corrected either by a lump sum
payment or off-set from other available marital assets.
On appeal, Mrs Kapfer objects to the credit given to Mr. Kapfer for the principal he paid on the mortgage of the marital home between the date of separation and the date of sale. After the parties separated in 1986, Mr. Kapfer was required to pay the mortgage on the marital home in which Mrs. Kapfer continued to live until November 1990. As part of the final order, the circuit court ordered the marital home to be sold with the net proceeds to be equally divided after Mr. Kapfer was reimbursed for the principal he paid on the mortgage after the date of separation. Mrs. Kapfer
agreed to the arrangement during the hearing before the family law
master by saying "That's fine."See footnote 9
W. Va. Code, 48-2-15(b)(4)  allows the circuit
court to require payments to third parties for charges necessary
for the occupancy of the marital home, but provides that the
circuit court can deem such payments to be "alimony, child support
or installment payment for the distribution of marital property. .
. ." In Syllabus Point 1, Sly v. Sly, ___ W. Va. ___, ___ S.E.2d
___ (No. 20167, Filed April 3, 1992), we said:
W. Va. Code, 48-2-15(b)(4)  provides that if the circuit court, upon ordering a divorce, requires payments to third parties in the form of home loan installments, land contract payments, rent, payment for utility services, property taxes, insurance coverage, or other expenses reasonably necessary for the use and occupancy of the marital domicile, those payments shall be deemed to be alimony, child support or installment payments for the distribution of marital property in such proportion as the circuit court may direct. W. Va. Code, 48-2-15(b)(4)  further provides that if the circuit court does not set forth in the order that a portion of such payments are deemed to be child support or installment payments for the distribution of marital property, then all such payments shall be deemed to be alimony.
In the present case, the parties agreed to allow Mr. Kapfer to recoup from the sale all mortgage principal he paid on the marital home after the date of separation and the circuit
court's order sets forth the parties' agreement. Given the
parties' agreement, we find no abuse of discretion in allowing Mr.
Kapfer to recoup from the net proceeds of the sale of the marital
home the principal he paid after the date of separation.
Finally, Mrs. Kapfer argues that the circuit court erred
in not requiring Mr. Kapfer to pay her attorney's fees, which
amounted to $2,100 at the hearing before the family law master. W.
Va. Code, 48-2-13(a)(4) , states that "[t]he court may compel
either party to pay attorney's fees and court costs reasonably
necessary . . . to prosecute or defend the action in the trial
court." In Syllabus Point 14, Bettinger, supra, we stated "[t]he
purpose of W. Va. Code, 48-2-13(a)(4) (1986), is to enable a spouse
who does not have financial resources to obtain reimbursement for
costs and attorney's fees during the course of the litigation."
In the present case, the circuit court required each
party to pay his or her own attorney's fees because the marital
assets were substantial, indeed each party receives 1377 shares of
stock that sells for about $40 per share. Based on these assets,
we agree with the circuit court's decision that reimbursement of
attorney's fees was not necessary to enable Mrs. Kapfer "to
prosecute or defend the action in the trial court." W. Va. Code,
However, on remand, the circuit court should again examine the issue of attorney's fees because of the additional fees and costs that have accrued on appeal and that will accrue on remand. In determining if Mr. Kapfer should be required to pay a portion of the additional fees and costs, the circuit court should consider the fact that several of the assignments of error occurred because Mr. Kapfer failed to present evidence of his current income and failed to provide information about the unequal tax treatment of the stocks.
Because we find merit in Mrs. Kapfer's assignments of
error concerning alimony, and classification and evaluation of
marital property, the judgment of the circuit court is reversed and
the case is remanded for further proceedings consistent with this
Reversed and remanded.
Footnote: 1Because the May 14, 1990 divorce order was entered without considering Mrs. Kapfer's exceptions to the recommended decision of the family law master filed on May 11, 1990, the circuit court after considering Mrs. Kapfer's exceptions adopted the recommended decision of the family law master on October 16, 1990.
Footnote: 2W. Va. Code, 48-2-16(b) , provides:
In cases where the parties to an action
commenced under the provisions of this article
have not executed a separation agreement, or
have executed an agreement which is incomplete
or insufficient to resolve the outstanding
issues between the parties, or where the court
finds the separation agreement of the parties
not to be fair and reasonable or clear and
unambiguous, the court shall proceed to
resolve the issues outstanding between the
parties. The court shall consider the
following factors in determining the amount of
alimony, child support or separate
maintenance, if any, to be ordered under the
provisions of sections thirteen and fifteen
[§§ 48-2-13 and 48-2-15] of this article, as a
supplement to or in lieu of the separation
(1) The length of time the parties were
(2) The period of time during the marriage
when the parties actually lived together as
husband and wife;
(3) The present employment income and other
recurring earnings of each party from any
(4) The income-earning abilities of each of the parties, based upon such factors as educational background, training, employment skills, work experience, length of absence
from the job market and custodial
responsibilities for children;
(5) The distribution of marital property to
be made under the terms of a separation
agreement or by the court under the provisions
of section thirty-two [§ 48-2-32] of this
article, insofar as the distribution affects
or will affect the earnings of the parties and
their ability to pay or their need to receive
alimony, child support or separate
(6) The ages and the physical, mental and
emotional condition of each party;
(7) The educational qualifications of each
(8) The likelihood that the party seeking
alimony, child support or separate maintenance
can substantially increase his or her income-earning abilities within a reasonable time by
acquiring additional education or training;
(9) The anticipated expense of obtaining the
education and training described in
subdivision (8) above;
(10) The costs of educating minor children;
(11) The costs of providing health care for
each of the parties and their minor children;
(12) The tax consequences to each party;
(13) The extent to which it would be
inappropriate for a party, because said party
will be the custodian of a minor child or
children, to seek employment outside the home;
(14) The financial need of each party;
(15) The legal obligations of each party to
support himself or herself and to support any
other person; and
(16) Such other factors as the court deems necessary or appropriate to consider in order to arrive at a fair and equitable grant of alimony, child support or separate maintenance.
Footnote: 3The March 7, 1991 hearing was held to consider Mrs. Kapfer's post-judgment, Rule 60(b), motion for relief.
Footnote: 4Effective January 1992, Mrs. Kapfer is to received $411 per month from Mr. Kapfer's pension plan.
Footnote: 5In 1986 Mrs. Kapfer estimated the cost of retraining to be $2,500 for a 6 month course.
Footnote: 6Although we hesitated to dictate any specific method for evaluating and dividing these stock options because of a lack of information, the circuit court should follow the broad guidelines for distributing pension benefits found in Syllabus Point 5, Cross v. Cross, 178 W. Va. 563, 363 S.E.2d 449 (1987).
Footnote: 7Mrs. Kapfer also questions the circuit court's evaluation of the automobile and the household furnishings. However the argument is not developed and given the conflicting evidence, we find that the circuit court did not abuse his discretion in valuing these items. See Syllabus Point 1, Bettinger supra.
Footnote: 8The only information in the record that noted the parties' tax liability for stock transactions in 1986 was the parties' 1986 Federal tax return, which listed $199 in income based on 40% of the capital gain distributions.
Footnote: 9On appeal Mrs. Kapfer contends for the first time that if Mr. Kapfer recoups principal paid after the date of separation, she should be allowed to recoup maintenance expenses.