The terms of a Decatur County divorce have been upheld on appeal, with the Indiana Court of Appeal rejecting arguments from both exes that the trial court erred in assessing and dividing assets and liabilities.
Husband Scott Bringle is the owner and sole shareholder of Center Line Precision Technology, an S corporation formed before he married Traci Bringle. Before their divorce, Scott “purchased” real estate from the company, which also paid his various personal expenses, bringing his total amount due to the business to $659,707.
Staci filed for divorce in October 2017, and at a final hearing two years later, Scott admitted to “mingling” his business and personal expenses. He testified that the transfer of the real estate and the personal expenses paid by his company were listed as “shareholder debt” on the balance sheet and would “be paid whenever.”
Meanwhile, Houlihan Valuation Advisors appraised the business at $1.05 million, with the $659,707 due from Scott deemed a non-operational asset. In a footnote, the valuation said the amount due from Scott “should be included in the marital balance sheet.”
Ultimately, the Decatur Circuit Court awarded 60% of the marital estate to Scott and 40% to Traci, giving Scott the company at Houlihan’s appraised valued. However, the court did not recognize the $659,707 owed by Scott as a liability of the estate. The parties were also ordered to pay their own attorney fees.
Both Scott and Traci filed cross-appeals, but the appellate court affirmed in all respects in a Tuesday opinion.
On appeal, Scott argued the trial court erred in not recognizing the $659,707 as a liability in the marital estate. But the appellate panel rejected his argument that statements from a status conference, the Houlihan footnote recommending that the amount be included in the marital balance sheet, and Scott’s own valuation of the company demonstrated error.
Instead, under the Hamlin doctrine, the appellate panel said the debt “is an indefinite contingent liability” that Scott — who is “one and the same” with his company — is not obligated to pay.
“Husband cannot require himself to pay the debt, and he has failed to demonstrate by a preponderance of the evidence that he intends to pay the debt, much less that he will actually pay the debt. The evidence supports a judgment that whether Husband will ever pay and discharge the debt is uncertain, if not problematic,” Judge Edward Najam wrote for the unanimous panel. “That is, the record supports a conclusion that Husband does not recognize an affirmative duty to pay the debt and, thus, the condition precedent required to create a current liability on the martial balance sheet will not be realized. As such, the trial court did not err when, after weighing the evidence, it did not include the shareholder debt as a current marital liability.”
On cross-appeal, Traci argued the trial court erred in its unequal division of the estate in Scott’s favor, not hers. But in rejecting that claim, Najam pointed to the “substantial assets” Scott brought into the marriage, Traci’s “substantial” earning ability in real estate, and the nearly $362,000 reconciliation payment Scott was ordered to make.
Finally, the appellate panel declined to order Scott to pay Traci’s attorney fees, finding no error in the trial court’s order for the parties to pay their own fees.
The case is Scott A. Bringle v. Traci A. Bringle, 19A-DN-3007.