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Collins v. Collins12/21/2004
Frogfur at $30,419. Lonnie argues the court incorrectly based its findings on the testimony of Gail's expert, James Connors (Connors), who, Lonnie claims, is unqualified as an expert in valuing businesses. Lonnie also contends the court credited assets to Gail twice even though she liquidated inventory from the businesses to support herself after the petition for dissolution was filed. As such, Lonnie alleges Gail was allowed to liquidate marital property yet receive a benefit in the decree based on assets no longer in existence.
Gail first argues the District Court correctly determined the value of the real property. Gail asserts the testimony of her expert, Vern Gebhart (Gebhart), a real estate broker previously hired by Lonnie to assist in selling the property, established a high value of the entire property at $168,667. Gail also presented the testimony of Sharon Grant, manager of the Yellowstone County Department of Revenue, who placed a low total value of $129,070 on both the residential and commercial portions of the real property. Gail contends the District Court did not abuse its discretion by averaging these two valuations and disregarding Lonnie's expert's appraisal, whose assessment was made for the purpose of enabling Lonnie to take out a loan after the dissolution.
Gail next argues the District Court did not err in reaching its valuation of the businesses. Gail contends her expert witness, Connors, made an accurate appraisal of the businesses utilizing an asset-based approach which provides a liquidation value of all assets and liabilities of the business to arrive at a proper valuation. Although Gail admits Connors had never valued a small business for purposes of a divorce , his testimony was based on a treatise published by the ABA Section of Family Law and consistent with standards applied by leading national experts in the field. Gail also contends the valuation of inventory and equipment for both businesses was made at the date of the parties' separation and includes all items sold at the garage sale.
We conclude the District Court did not err in determining the value of the marital estate. First, the court properly considered substantial credible evidence in valuing the real property. Indeed, both parties presented evidence at trial regarding the real property's value. Lonnie's expert estimated a value of $100,000 for the residential portion of the real property. Gail's experts, Gebhart and Grant, valued the real property, including both the residential and commercial portions, at $168,667 and $129,070 respectively. Adjusting Gebhart's valuation to the Laurel market and averaging it with the State's value, the District Court found the real property, including both the commercial and residential portions, yielded a value of approximately $140,135. Further, the District Court found Lonnie, acting in his individual capacity, had encumbered the real property with a deed of trust in the amount of $44,050 and therefore was solely responsible for its repayment.
Second, the District Court also correctly considered substantial credible evidence in valuing the Blue Bell and Frogfur businesses. Again, the court was presented with testimony regarding the value of both businesses. Through videotape deposition, Gail submitted the testimony of Connors, an expert in the field of business valuation. Connors testified to three different methods used when valuing a business. Of the three methods, the District Court adopted the asset-based approach, which provides a liquidation value of all assets and liabilities of the business to arrive at a business valuation. The District Court reasoned the asset-based approach was the only accurate method to use when a busine
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