In re Marriage of Nakiya Ramsey and Steven Holmes
Presented by Ron J. Anfuso, CPA, ABV, CFF, CDFA, FABFA
Second Appellate District
Nakiya Ramsey and Steven Holmes were married in October 2007 and separated in April of 2015. They had two children. The family lived in the home at issue from February 2005 until April 2015. Nakiya filed a petition for dissolution of marriage in October 2016.
The one-day trial took place in December 2019. Of the issues of concern in this trial, the one addressed here is the community property interest in the family home.
The dilemma before the court was that neither of the parties provided adequate evidence to allow the court to correctly calculate the community property share in the home. Steven, while recognizing at the trial the absence of critical evidence, declined to submit it, believing it was Nakiya’s burden to do so.
To make accurate Moore/Marsden calculations, the court must have (a) the purchase price of the home, (b) the amount of community funds used to reduce the mortgage principle, which in many cases, such as in this case, can be determined by calculating the difference between the balance on the mortgage at the start of the marriage and the balance at separation, (c) the market value of the house at the start of the marriage, and (d) the market value of the house at dissolution.
Steven bought the home in January 2005 as his separate property. The total purchase was $740,000. Steven put down $140,000 and obtained a $600,000 mortgage. The monthly payments varied because he secured an adjustable mortgage. The average monthly payment during that period was $3,200. During the marriage up until the separation, the mortgage payments were made with community property funds. According to Nakiya, the value of the home at the time of the trial was $1.2 million.
Nakiya’s counsel questioned Steven about three income and expense declarations he had filed, one each year from 2017 through 2019. Each had a section for Steven’s average monthly expenses related to him only. In his 2017 declaration, he checked the box for mortgage for $8,000. He did not fill in the spaces asking for the amount of principal and interest he paid. In the spaces for the amount of real property taxes and homeowner’s insurance, he just wrote “INC.”
Specifics of the Trial
Steven indicated that his average monthly mortgage payment was $3,558 on his 2018 declaration. He stated he paid an average monthly principal of $576 and interest of $1,505. In 2019, Steven indicated his monthly payment was $3,624 with $1,202 going toward principal and $2,288 to interest. In each case, he indicated that the amounts included taxes and insurance.
Nakiya’s counsel questioned Steven about the amounts he listed for his average monthly mortgage payments. However, she failed to question him about, or draw attention to, what components were included in the payments.
Steven, who is a licensed real estate broker, stated that the current home value was approximately $950,000. However, Nakiya failed to ask what the value of the home was at the time of marriage.
Steven’s counsel argued that Nakiya had not established any of the amounts needed to make the Moore/Marsden determination. He contended that Nakiya not only failed to present evidence of what the balance of the mortgage was on the date of the marriage, but also how much the principal was reduced. He also claimed that she provided only her own opinion as to the current value of the house without explaining how she reached it. She did express that the value at the time of the marriage was $779,000.
In the next issue of Forensic Accounting Today (Issue 65), I will discuss the closing remarks of the trial court, the trial court’s findings, the appeal, and the Appellate Court’s findings.