In re Marriage of Probasco
676 N.W.2d 179 (Iowa 2004)

Facts:

  • Craig and Ralane met in college in 1983, where both graduated in 1986 with degrees in Business.
    • Craig then worked as an insurance salesman for a short period while Ralane was at home with the kids.
  • They married in 1991 and opened a Perkins franchise around that time.
    • Ralane was working the Census Bureau and Wilson Trailer of Sioux City from 1990-1994.
      • The family relied on her income over this period.
    • From 1994-1998 she did accounting work for the restaurant.
  • The Perkins eventually became the highest volume Perkins in the system with annual sales of over $3.8 million.
    • Craig was making $238k.
  • In 1999, Craig filed for divorce.

History:
Ralane was awarded reimbursement alimony of $60k per year for 13 years, and net assets of around $801k. Craig received net assets of around $716k.

  • The rationale for the alimony award was that it was compensation for Ralane’s contribution to Craig’s obtaining the downtown Perkins franchise.
  • The 13 years was because the Perkins lease was up in 12 years.

Issue:
Whether the alimony award was proper.

Holding:
No.

Reasoning:
According to this case, there are three types of alimony:

  1. Traditional Alimony: This is payable for life or so long as a spouse is incapable of self-support.
  2. Rehabilitative Alimony: This is a way of supporting an economically dependent spouse through a limited period of re-education or retraining following divorce, thereby creating incentive and opportunity for that spouse to become self-supporting.
  3. Reimbursement Alimony: Support given as a reimbursement for expenses incurred by a spouse during the marriage (e.g., where the wife supports the husband during school while he receives a degree).

The court noted that reimbursement alimony (as well as rehabilitative) is appropriate for marriages of short duration which are devoted almost entirely to the educational advancement of one spouse and yield the accumulation of few tangible assets.

Here, however:

  1. The marriage was not one of short duration devoted almost entirely to the educational advancement of one spouse. To the contrary, both parties obtained their degrees and neither contributed to the education of the other.
  2. Although Ralane may not have pursued her career in business as much as she may have liked, she nevertheless was active in the job market during the marriage.
  3. This is not a case where the parties have little or no net worth resulting in a case where the “supporting” spouse receives little or nothing by way of a property settlement whereas the other spouse has a substantial earning capacity.

“In short, Ralane has her degree, her skills, an unencumbered home and car, and a property award in excess of $800,000 with very little debt. We agree with Craig that Ralane has been compensated for her contributions.”

Rule: Reimbursement alimony (as well as rehabilitative) is appropriate for marriages of short duration which are devoted almost entirely to the educational advancement of one spouse and yield the accumulation of few tangible assets.