in the Court of Appeals 24 October 2017.
by defendant from orders entered 22 August 2016 by Judge
Andrea F. Dray in Buncombe County Nos. 13 CVD 5370, 15 CVS
3789 District Court.
Siemens Family Law Group, by Jim Siemens, for
Cecilia Johnson for defendant-appellant.
appeal arises from domestic litigation between Dennis Kabasan
(defendant) and his ex-wife Sonia Kabasan (plaintiff).
Defendant appeals from equitable distribution, alimony, and
child support orders entered by the trial court on 22 August
2016. Defendant has raised fourteen issues on appeal, in two
of which he challenges the trial court's acceptance of
Phaedra Xanthos as an expert in accounting, as well as the
court's adoption of most of plaintiff's proposed
findings and conclusions. Defendant also contends that the
trial court abused its discretion in the classification,
valuation, and distribution of certain assets in its
equitable distribution order. Defendant further argues that
the trial court erred in the calculations and rulings made in
the court's alimony and child support orders. After
consideration of defendant's arguments, in light of the
record on appeal and the applicable law, we affirm in part
and reverse and remand in part.
and Procedural Background
parties met in Brazil and were married there on 16 January
1999. Plaintiff was born in Brazil in 1960, and lived in
Brazil until her marriage to defendant. Defendant, who was
born in 1946, worked until his retirement in 2010 as a
physician at the Veterans Administration Hospital in
Asheville, North Carolina. Prior to marrying, the parties
executed a prenuptial agreement. After they married, the
couple moved to Asheville. One child was born to the
marriage, a daughter born in 2000. During the marriage, the
parties acquired property in the United States and Brazil.
They traveled to Brazil, and plaintiff spent time in Brazil
with her family.
December 2013, plaintiff filed a complaint, which was
assigned Buncombe County No. 13 CVD 5370, seeking divorce
from bed and board, postseparation support, alimony,
attorney's fees, and possession of the marital home.
Defendant filed an answer on 31 January 2014, denying the
material allegations of plaintiff's complaint, raising
various defenses, stating a counterclaim for joint legal and
physical custody of their daughter, and asking the court to
impose travel restrictions on the minor child. In his answer
and counterclaim, defendant also alleged that the
parties' prenuptial agreement barred plaintiff's
claims for alimony, postseparation support, and
attorney's fees, and that the terms of the prenuptial
agreement should govern the division of the parties'
property. Plaintiff filed a reply on 28 March 2014, in which
she agreed that the prenuptial agreement was valid, asked the
court to determine child custody, and sought child support
from defendant. On the same day, the trial court entered an
order that awarded plaintiff temporary postseparation support
and child support, granted the parties joint legal and
physical custody of the minor child, and granted plaintiff a
writ of possession of the marital home. On 9 July 2015, the
trial court entered a final child custody order granting the
parties joint legal and physical custody of their daughter.
August 2015, plaintiff filed a complaint that was assigned
Buncombe County No. 15 CVD 3789, seeking absolute divorce,
equitable distribution of the parties' marital assets,
and consolidation of the action with her previously-filed
complaint. Plaintiff alleged that the prenuptial agreement
did not bar her claim for equitable distribution, and that a
division of the marital estate "in favor of
plaintiff" would be equitable. On 18 September 2015,
defendant filed an answer and counterclaim seeking, inter
alia, an equal division of the marital estate. The
parties were divorced on 26 February 2016. On 8 March 2016,
the trial court entered a declaratory judgment that the
prenuptial agreement was valid and would be enforced, and
that an equal division of the marital estate would be
was conducted on the issues raised by the parties'
pleadings beginning on 25 April 2016, and on 22 August 2016,
the trial court entered orders for equitable distribution,
alimony, and child support. The evidence adduced at trial and
the provisions of the court's orders are discussed below,
as relevant to the issues raised on appeal. Defendant has
appealed to this Court from these orders.
is undisputed that '[t]he standard of review on appeal
from a judgment entered after a non-jury trial is whether
there is competent evidence to support the trial court's
findings of fact and whether the findings support the
conclusions of law and ensuing judgment.' "
Cushman v. Cushman, __ N.C.App. __, __, 781 S.E.2d
499, 501 (2016) (quoting Pegg v. Jones, 187 N.C.App.
355, 358, 653 S.E.2d 229, 231 (2007)). "The trial
court's findings of fact are binding on appeal as long as
competent evidence supports them, despite the existence of
evidence to the contrary." Resort Realty of the
Outer Banks, Inc. v. Brandt, 163 N.C.App. 114, 116, 593
S.E.2d 404, 408 (2004) (citation omitted). "Simply
stated, where the trial court's findings of fact are
supported by competent evidence, and the findings of fact, in
turn, support the trial court's conclusions of law, the
decision of the trial court will be affirmed. This Court will
not reweigh the evidence." Pegg, 187 N.C.App.
at 358, 653 S.E.2d at 231. Moreover, "where a trial
court's findings of fact are not challenged on appeal,
they are deemed to be supported by competent evidence and are
binding on appeal." Juhnn v. Juhnn,
242 N.C.App. 58, 63, 775 S.E.2d 310, 313 (2015) (citation
omitted). "While findings of fact by the trial court in
a non-jury case are conclusive on appeal if there is evidence
to support those findings, conclusions of law are reviewable
de novo." Robbins v. Robbins, 240
N.C.App. 386, 394, 770 S.E.2d 723, 728 (internal quotation
marks omitted), disc. review denied, 368 N.C. 283,
775 S.E.2d 858 (2015).
has appealed from orders for equitable distribution, child
support, and alimony. "[W]hen reviewing an equitable
distribution order, this Court will uphold the trial
court's written findings of fact as long as they are
supported by competent evidence. However, the trial
court's conclusions of law are reviewed de
novo. Finally, this Court reviews the trial
court's actual distribution decision for abuse of
discretion." Mugno v. Mugno, 205 N.C.App. 273,
276, 695 S.E.2d 495, 498 (2010) (citations and quotation
marks omitted). Similarly, our review of a child support
is limited to a determination whether the trial court abused
its discretion. Under this standard of review, the trial
court's ruling will be overturned only upon a showing
that it was so arbitrary that it could not have been the
result of a reasoned decision. The trial court must, however,
make sufficient findings of fact and conclusions of law to
allow the reviewing court to determine whether a judgment,
and the legal conclusions that underlie it, represent a
correct application of the law.
Spicer v. Spicer, 168 N.C.App. 283, 287, 607 S.E.2d
678, 682 (2005) (citations omitted). This Court has
summarized our review of alimony orders as follows:
If the court's findings of fact are supported by
competent evidence, they are conclusive on appeal, even if
there is contrary evidence. Whether a spouse is entitled to
an award of alimony or post-separation support is a question
of law. This Court reviews questions of law de novo.
. . . The trial court's determination of the amount of
alimony is reviewed for an abuse of discretion.
Collins v. Collins, __ N.C.App. __, __, 778 S.E.2d
854, 856 (2015) (citing Rickert v. Rickert,
282 N.C. 373, 379, 193 S.E.2d 79, 82 (1972)) (other citations
of Plaintiff's Expert Witness
first argues that the trial court "abused its discretion
when it accepted Phaedra Xanthos as an expert in forensic
accounting and valuation" and that the court
"should have disqualified her and her testimony once it
became apparent she was not competent to testify as an
expert." We disagree.
Qualification of Ms. Xanthos as an Expert in Accounting
argues that it was error to allow Ms. Xanthos to testify as
an expert in "forensic accounting and valuation."
Although in its equitable distribution order, the trial court
found that Ms. Xanthos "was qualified as an expert in
forensic accounting and valuation, " the transcript
establishes that, following voir dire, the trial court ruled
that "Ms. Xanthos is qualified by this Court in the area
-- as an expert in the area of accounting." At no time
during the trial did the trial court rule that Ms. Xanthos
was an expert in forensic accounting and valuation. We
conclude that Ms. Xanthos testified as an expert in
accounting, rather than as an expert in related specialties.
Moreover, at trial, defendant did not dispute that Ms.
Xanthos was well-qualified as an expert in accounting,
forensic accounting, or valuation. Following voir dire,
defendant's counsel stated:
Your Honor, I certainly don't deny that she, Miss
Xanthos, has an impressive resume. Certainly she's well
qualified in fraud investigations, in business valuations,
all of these things listed here. I would contend, however,
that she is certainly not an expert in coverture fractions,
in valuing pensions in North Carolina, anything like that. .
. . So I have very real reservations about Miss Xanthos
presenting herself as an expert in this case specifically as
to a retirement account and an annuity.
appeal, defendant argues that the trial court abused its
discretion by failing to disqualify Ms. Xanthos as an expert,
on the grounds that she offered "speculative"
testimony as to the value of certain financial assets and
real property, and that her responses to defendant's
cross-examination raised doubts as to whether Ms. Xanthos was
familiar with Brazilian family law or with the proper
interpretation of Watkins v. Watkins, 228 N.C.App.
548, 746 S.E.2d 394 (2013). Defendant contends that although
Ms. Xanthos was "qualified as an expert initially"
she "should have later been disqualified" and that
the trial court "abused its discretion in not
disqualifying Ms. Xanthos and striking her testimony[.]"
the trial, defendant objected to the trial court's
consideration of certain portions of Ms. Xanthos's
testimony, but did not move to disqualify Ms. Xanthos as an
expert in accounting. Thus, defendant's appellate
argument is apparently that that the trial court erred by not
disqualifying her ex mero motu. Defendant has not
cited any legal authority in support of his position.
"It is not the role of the appellate courts . . . to
create an appeal for an appellant." Viar v. N.C.
DOT, 359 N.C. 400, 402, 610 S.E.2d 360, 361 (2005).
"It is likewise not the duty of the appellate courts to
supplement an appellant's brief with legal authority or
arguments not contained therein." State v.
Hill, 179 N.C.App. 1, 21, 632 S.E.2d 777, 789 (2006).
it is well-established that doubts as to an expert's
opinions go "to the weight of the witness's
testimony and not to his competence as a witness."
Winston-Salem v. Cooper, 315 N.C. 702, 714, 340
S.E.2d 366, 373 (1986). In Winston-Salem, the
appellant argued that "its own expert showed [the
appellee's expert's] opinion was based on an
erroneous understanding of the applicable zoning ordinances,
thus disqualifying [him] as a competent expert witness."
Id. at 713, 340 S.E.2d at 373. Our Supreme
Court rejected this argument:
Even if [the expert] based his ultimate opinion as to value
on a misunderstanding of the allowable uses permitted by the
zoning ordinance, this would not be grounds for striking his
testimony. It would constitute an attack on part of the data
he might have considered in arriving at his opinion.
"The process or method used . . . might be considered on
the question of the credibility of the expert witnesses, but
not on the competency or admissibility of their
Winston-Salem, 315 N.C. at 714, 340 S.E.2d at 373
(quoting State v. Tola, 222 N.C. 406, 409, 23 S.E.2d
321, 323 (1942)). We conclude that defendant has failed to
establish that he is entitled to relief on the basis of this
Valuation of Financial Instruments
argues next that the trial court abused its discretion in
"how it valued the marital portion of the TSP account,
the Aviva annuity, the Vanguard Trust, and the Vanguard IRA,
as of [the] date of separation[.]" We have carefully
considered defendant's contentions concerning this issue,
and conclude that defendant is not entitled to relief.
Gen. Stat. § 50-20.1 (2016) addresses equitable
distribution awards of vested and nonvested "pension,
retirement, or other deferred compensation benefits."
N.C. Gen. Stat. § 50-20.1(d) provides that the percent
of such benefits to which each spouse is entitled is
calculated as follows:
(d) The award shall be determined using the proportion of
time the marriage existed (up to the date of separation of
the parties), simultaneously with the employment which earned
the vested and nonvested pension, retirement, or deferred
compensation benefit, to the total amount of time of
employment. The award shall be based on the vested and
nonvested accrued benefit, as provided by the plan or fund,
calculated as of the date of separation, and shall not
include contributions, years of service, or compensation
which may accrue after the date of separation. The award
shall include gains and losses on the prorated portion of the
benefit vested at the date of separation.
"The numerator of this fraction, termed a coverture
fraction, 'represents the total number of years of
marriage, up to the date of separation, which occurred
simultaneously with the employment which earned the vested
[and nonvested] pension. The denominator represents the total
years of employment during which the pension accrued.'
" Robertson v. Robertson, 167 N.C.App. 567,
572, 605 S.E.2d 667, 670 (2004) (quoting Bishop v.
Bishop, 113 N.C.App. 725, 729-30, 440 S.E.2d 591, 595
(1994) (internal quotation marks omitted)).
present case, defendant argues that the trial court abused
its discretion by applying the coverture fraction to
determine the value of the marital portion of four financial
assets: the TSP, the Aviva account, the Vanguard IRA, and the
Vanguard Trust. Defendant has not challenged the evidentiary
support for any specific findings of fact in the trial
court's order. Accordingly, the court's findings are
conclusively established. "Unchallenged findings of fact
are binding on appeal. . . . The trial court's
conclusions of law must be supported by adequate findings of
fact." Peters v. Pennington, 210 N.C.App. 1,
13, 707 S.E.2d 724, 733 (2011) (citing Koufman v.
Koufman, 330 N.C. 93, 97, 408 S.E.2d 729, 731 (1991)).
present case, the trial court's findings of fact included
the following findings relevant to the court's valuation
of the marital portion of the TSP account, the Aviva annuity,
the Vanguard IRA, and the Vanguard Trust:
37. The Defendant retired from the V.A. on May 17, 2010.
38. During the Defendant's employment at the V.A., he
participated in the Federal Employees Retirement Savings
program (hereinafter, FERS) and in the Federal Thrift Savings
Plan (hereinafter, TSP).
. . .
46.The TSP is similar to a 401(k) type plan except that the
TSP associated with the FERS employees includes employer or
agency contributions which are subject to vesting. FERS
employees have a time in service requirement before agency
47.The Defendant transferred TSP funds, including TSP funds
properly classified as marital funds, into an Aviva Annuity
and into a Vanguard IRA.
48. The parties disagree about the proper method of valuing
the marital portion of the TSP, and therefore disagree as to
the value of the marital portion of the Aviva Annuity and the
49.The parties also disagree about the fair market value of
the Aviva Annuity at date of separation and presently.
50.To resolve these issues, the Court must first consider the
proper valuation approach to take in determining the value of
the marital portion of the TSP. The Plaintiff contends that
the use of the coverture fraction is proper pursuant to N.C.
G.S. §50-20.1. Using this approach, the Plaintiff
concludes that 50.2% of the TSP is marital.
51.The Plaintiff then goes on to conclude that 50.2% of the
money transferred from the TSP to purchase the Aviva Annuity
created a 50.2% interest in the Aviva Annuity.
52.The Defendant rolled $400, 000 in TSP money into the Aviva
Annuity, in order to purchase the Aviva Annuity on June 2,
2011. . . .
53. The Plaintiff concludes that $200, 738 or 50.2% of the
Aviva Annuity was purchased with marital money from the TSP.
54. The Defendant also rolled $196, 193 in TSP money out to a
Vanguard IRA on March 11, 2013. . . .
55. The Plaintiff concludes that $98, 458 or 50.2% of this
rollover was marital money. . . .
56. Both the Aviva Annuity and the Vanguard IRA have
passively increased in value since these rollovers occurred.
57. On the date of separation, the Plaintiff contends that
the marital portion of the Vanguard IRA was $103, 219. . . .
The Plaintiff contends that date of distribution value is
$112, 372, again due to passive growth.
58. The Defendant has valued the TSP by using a tracing
method, considering and totaling each contribution to the
account made during the marriage, together with passive gains
and losses on these amounts. In support of this approach,
which is not supported by N.C. G.S. §50-20.1, the
Defendant relies on Watkins v. Watkins, 228 N.C.App.
548, 746 S.E.2d 394 (2013).
59. In Watkins, the trial court was reversed for
failing to use a coverture fraction to divide an IRA that was
funded with "deferred compensation" even though all
compensation had been earned by Defendant Watkins at his date
60. The TSP in this case likewise contained deferred
compensation; that is, compensation from the employer that
was subject to vesting. Although the Defendant's TSP was
fully vested at the time of his retirement, Defendant
Kabasan's [situation] cannot be discerned from that of
Defendant Watkins, who had also separated from his employer
and whose benefits were fully vested at the time of his
61. The Court of Appeals in Watkins has stated that:
"We note that there are certain 401(k) plans pursuant to
which employer contributions vest over a designated period of
time and that employer contributions in these instances might
be construed as 'deferred compensation benefits.'
" Watkins v. Watkins, 228 N.C.App. 548[, 554, ]
746 S.E.2d 394[, 398] (2013). . . .
62. The TSP in this case is analogous to a 401(k) that
contains "deferred compensation benefits" in that a
certain portion of the TSP contributions made by the
Defendant's employer were subject to vesting.
63. The Defendant's expert, Edward Fidelman, did not
consider Watkins before using his tracing valuation
method with respect to the TSP.
64.Mr. Fidelman was unable to state what portion of TSP
contributions by the Defendant's employer [was] subject
to vesting requirements.
65. Mr. Fidelman defined deferred compensation as all
compensation by an employer that is "not immediately
subject to tax[, ]" a definition that is actually
broader than the definition provided in Watkins.
66. The Court has no evidence upon which it can make a
determination as to what part of the TSP contributions
occurring during marriage [was] subject to vesting and
therefore "deferred compensation" and what portion
of said contributions [was] immediately vested.
67. The Defendant's analysis, produced by Edward
Fidelman, . . . contains an assumption that all marital money
traced in the TSP was used to purchase the Aviva Annuity.
Because the methodology applied by the Defendant to determine
the marital portion of the TSP is rejected, the Court need
not further consider whether or not the Defendant's
assumption is correct.
68.The Court finds that Phaedra Xanthos, the Plaintiff's
expert, has correctly applied a coverture fraction to the
69. The Court finds it equitable therefore, that this
coverture fraction be extended to the Aviva Annuity, in order
to determine the marital component of the Aviva Annuity, and
extended to the Vanguard IRA, in order to determine the
marital component of the Vanguard IRA.
70. The Court finds that on the date of separation, the
marital value of the Vanguard IRA was $103, 219. . . . The
Court finds that the date of distribution marital value of
this IRA is $112, 372 due to passive growth.
. . .
81. On the date of separation, the Aviva Annuity accumulated
value was $484, 707.86.
82. The present Aviva Annuity accumulated value is $543,
83.The marital portion of the Aviva Annuity is 50.2% or $272,
942 of the present value.
. . .
136.The parties dispute whether or not a portion of the
balance of the Defendant's Vanguard Securities Account,
which existed as a Family Trust at ...