author:
KAPSNER, Justice.
      SANDSTROM, Justice,

text:
    2002 ND 144
    Sheila BOEHM, Plaintiff and Appellee, v. David BOEHM, Defendant and Appellant.
    No. 20010318.
    Supreme Court of North Dakota.
    Aug. 29, 2002.

      Todd D. Kranda, Kelsch, Kelsch, Ruff & Kranda, Mandan, ND, for plaintiff and ap-pellee.
    Robert V. Bolinske, Jr., Bismarck, ND, for defendant and appellant.
   KAPSNER, Justice.

[¶ 1]- David Boehm appeals from a divorce judgment, challenging the trial court’s denial of his motion for continuance, the property division, and child support calculation. The trial court did not abuse its discretion in denying the motion for a continuance, and was not clearly erroneous in its property division. The. trial court did err as a matter of law in calculating David’s child support obligation. We affirm in part, reverse in part, and remand .for further proceedings consistent with this opinion.

I

[¶ 2] Sheila and David Boehm were married in August of 1989. Sheila worked at Wal-Mart and David managed the family video store business. They have two minor children. In January of 2001, Sheila filed for divorce on the grounds of irreconcilable differences. Trial was set for September 6, 2001.

' [¶3] In January of 2000, David had entered into an agreement with his father regarding a video store business with locations in Bismarck and Dickinson. The “lease with option to purchase” covered a seven-year period — January 1,. 2000 through December 31, 2006. The terms of the agreement included an initial $25,000 payment and monthly payments of $2500. If the agreement ran the full term, David could purchase the business “for $20,000.00 or- a different price if agreed to ... in writing.” David could also purchase the business before the duration of the agreement had run “by applying an amount equal to 85 percent of the total lease payments to date ... and paying the difference in cash.” The agreement valued the business at $200,000, but the price could “be modified if agreed to ... in writing.” In June of 2001, the Bismarck location was destroyed by fire. In August of 2001, David moved for a continuance of the trial, based on the uncertain future of the business. His motion was denied, and trial was held on the date scheduled.

[¶ 4] On November 8, 2001, the parties were granted a divorce on the grounds of irreconcilable differences. Sheila was awarded custody of their two children, and David’s child support obligation was calculated to be $779 per month. David has appealed the denial of the motion for continuance, the property division, and child support calculation.

II

[¶ 5] David contends the trial court abused its discretion in denying his request for continuance of the September 2001 trial date. He argues because the destruction of the video store rendered his business future and income uncertain, it would have been beneficial for both parties to have the trial continued to a later date. David asserts the complexity of the situation, amplified by the provisions of the lease, made it impossible to clarify issues regarding the business prior to the scheduled trial date.

[¶ 6] “A motion for continuance will be granted only for good cause shown.” Kjonass v. Kjonass, 1999 ND 50, ¶ 11, 590 N.W.2d 440. “The decision to grant or deny a motion for continuance lies within the discretion of the trial court, and its determination will not be overturned on appeal absent an abuse of discretion.” Id. “A trial court abuses its discretion when it acts in an arbitrary, unreasonable, or unconscionable manner.” Fahlsing v. Teters, 552 N.W.2d 87, 90 (N.D.1996).

[¶ 7] Even though the Bismarck business location was destroyed on June 12, 2001, David did not move for a continuance until August 23, 2001 — two weeks before the scheduled trial date. David failed to assert any pertinent information, whether financial or otherwise, was destroyed in the fire. Under these circumstances we cannot say the trial court acted arbitrarily, unreasonably, or unconscionably in denying David’s request for a continuance. The trial court did not abuse its discretion.

Ill

[¶ 8] David argues he is entitled to one-half of the value of both the marital home and Sheila’s Wal-Mart retirement accounts because of contributions made during the marriage. He also argues valuing the video store at $40,000 is clearly erroneous.

A

[¶ 9] Under N.D.C.C. § 14-05-24(1), “[w]hen a divorce is granted, the court shall make an equitable distribution of the property and debts of the parties.” “There is no set formula for dividing a marital estate, but the trial court must equitably divide the property based upon the circumstances of the particular case.” Nelson v. Nelson, 1998 ND 176, ¶ 6, 584 N.W.2d 527. With property distribution, equitable does not mean equal, but a substantial disparity must be explained. Wald v. Wald, 556 N.W.2d 291, 294 (N.D.1996). “The trial court’s determinations regarding division of property are treated as findings of fact and will not be reversed unless they are clearly erroneous.” Mellum v. Mellum, 2000 ND 47, ¶ 14, 607 N.W.2d 580. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if there is no evidence to support it, or if, although some evidence supports it, on the entire evidence this Court is left with a definite and firm conviction a mistake has been made. Peterson v. Peterson, 1999 ND 191, ¶ 6, 600 N.W.2d 851.

[¶ 10] When distributing property, the trial court must use the Ruff-Fischer guidelines, which stipulate the consideration of the following factors:

the respective ages'of the parties to the marriage; their earning abilities; the duration of the marriage and the conduct of each during the marriage; their station in life; the circumstances and necessities of each; their health and physical conditions; their financial circumstances as shown by the property owned at the time; its value and income-producing capacity, if any, and whether it was accumulated or acquired before or after the marriage; and such other matters as may be material.

Mellum, 2000 ND 47, ¶ 15, 607 N.W.2d 580. We have held the trial court must consider all property accumulated by the parties, whether jointly or individually owned. Barth v. Barth, 1999 ND 91, ¶ 8, 593 N.W.2d 359. After all assets are included in the marital estate, only then under the Ruff-Fischer guidelines can the source of the property be considered in making the equitable distribution. Barth, at ¶ 8.

[¶ 11] David’s argument he is automatically entitled to one-half of the value of both the marital home and Sheila’s retirement accounts is flawed. The award of the marital home and the Wal-Mart retirement accounts to Sheila “can only properly be considered in the context of the entire property distribution.” Lohstreter v. Lohstreter, 1998 ND 7, ¶ 34, 574 N.W.2d 790 (Neumann, J., concurring and dissenting). The trial court does not examine and distribute each piece of property independently without regard to other property. Instead, all assets and property accumulated by the parties, including the home and retirement accounts, must be included in the marital estate and considered , by the trial court. See Dufner v. Dufner, 2002 ND 47, ¶ 9, 640 N.W.2d 694 (holding a trial court must consider all property obtained by the divorcing parties). Once all property is included in the marital estate, only then is it equitably divided. See id. The whole distribution of property must be equitable, not each individual asset. Emter v. Emter, 1999 ND 102, ¶ 10, 595 N.W.2d 16.

B

[¶ 12] David also argues valuing the video store at $40,000 is clearly erroneous. David contends the store has a value of $0, while Sheila contends the store has a value of $300,000. Sheila’s valuation is based upon the $20.0,000 purchase price listed in the agreement and insurance policy values on the Bismarck location. David’s valuation is based upon the destruction of the Bismarck location and his contention he did not have any vested interest in the business. The trial court valued the store at $40,000 based on David’s “experience and management abilities.”

[¶ 13] A trial court’s determination on valuation of property is treated as a finding of fact and will be reversed only if clearly erroneous. Kautzman v. Kautzman, 1998 ND 192, ¶ 8, 585 N.W.2d 561. “The trial court, which had the opportunity to observe the demeanor and credibility of the parties, is in a far better position than an appellate court in ascertaining the true facts regarding the property’s value.” Freed v. Freed, 454 N.W.2d 516, 521 (N.D.1990). “Marital property valuations within the range of the evidence are not clearly erroneous.” Peterson, 1999 ND 191, ¶ 12, 600 N.W.2d 851. Generally, fair market value is the proper method of valuing marital property in a divorce. Id. at ¶ 11. Earning power is not a property interest subject to equitable distribution. See Nastrom v. Nastrom, 262 N.W.2d 487, 493 (N.D.1978) (“Earning power is not, however, property that a court may divide as it would a parcel of land or a collection of household goods.”). A trial court can value property 'not yet completely owned by one of the divorcing parties. ■ See Peterson, at ¶ 13-(affirming a trial court’s valuation of a steakhouse where a balance was owing on its contract for deed). Property interests not yet reduced to possession during the marriage are to be regarded as marital property if the interest still exists at the time of divorce. See Sonja A. Soeh-nel, Annotation, Divorce Property Distribution: Treatment and Method of Valuation of Future Interest in Real Estate or Trust Property not Realized During Marriage, 62 A.L.R.4th 107, 135 (1988) (citing Frank G.W. v. Carol M.W., 457 A.2d 715 (Del.1983)). Although David did not yet have the legal title to the video store business we cannot conclude the trial court erred in including it in the property distribution where the contract provided for eventual transfer of title and the contract remained in force at the time of trial. See Peterson, at ¶ 13.

[¶ 14] The agreement between David and his father was styled as a “lease with option to purchase.” That description is not conclusive and we are not bound by it. Prairieview Nursing Home v. North Dakota Department of Human Services, 1999 ND 142, ¶ 13, 598 N.W.2d 116. Rather than being a lease with an option to purchase the video stores, the agreement is more akin to a conditional sale. Wallwork Lease and Rental Co. v. JNJ Investments, Inc., 303 N.W.2d 545, 547 (N.D.1981) (citing Burroughs Corp. v. Barry, 380 F.2d 427, 431 (8th Cir.1967)). In this instance, David has the capacity to realize a value from the agreement because he has the ability to complete the sale. Future interests may constitute intangible personal property which are marital assets subject to equitable distribution. See 24 Am.Jur.2d Divorce and Separation § 515 (1998) (“Choses in action, rights, and other interests, the benefits of which may be receivable, now and in the future, may constitute intangible personal property which are marital assets subject to equitable distribution.”). According to the provisions of the agreement, David could “purchase the [business] at anytime after December 31, 2001, but before December 31, 2006.” The business included locations in both Bismarck' and Dickinson. The Dickinson location was not destroyed and was still operating at the time of trial. An operating business has a value. See Bard v. Bard, 380 N.W.2d 342, 344 (N.D.1986) (a business’ value includes “at a minimum the interest in the office equipment, furniture, fixtures, and the accounts receivable.”). David could realize a value from the agreement because he could still purchase the video store business.

[¶ 15] Forty thousand dollars is within the range of values which could have been assigned to the video store business. David was approximately eighteen months into the seven-year term of the agreement. If David was current on his monthly $2500 payments through June of 2001, he would have paid a total of $42,500 in payments. Although the evidence suggests David was late in his payments, there is no evidence David’s father declared a default in the business agreement, and at the time of the trial David was continuing in his management of the business. Under the terms of the agreement, eighty-five percent of the monthly payment amount could be applied to the purchase price. Eighty-five percent of the total payments due through June 2001 results in $86,125. In addition David had made a down payment of $25,000. We cannot say the valuation of the video store business at $40,000 is clearly erroneous.

C

[¶ 16] The trial court awarded Sheila $177,888 in marital property, allocated $88,188 in debt to her, leaving her with a net award of $89,700. David was awarded $60,217, allocated $7,205 in debt, and left with a net award of $53,012. While acknowledging the disparity in the awards, the trial court adequately accounted for it in its factual findings. The trial court explained:

XV.
Her need for additional cash is a consideration in determining that she should be able to retain the liquidity represented by her Wal-Mart savings plan.
XVI.
... The history of domestic violence, and the Defendant’s chemical dependency problems are considered to be a principal reason for the failure of this marriage. He has, if he can mobilize his abilities, greater earning capacity than the Plaintiff, and she will need a significant period of training in order to have a reasonable earning level....
XVII.
Also taken into account are the needs of the minor children of the parties, for whom the Plaintiff will be assuming principal responsibility. The distribution allows for adequate housing for the benefit of the children to be maintained as an alternative to a forced sale of the residence and division of the proceeds.
XVIII.
Also the Plaintiff will be assuming a larger portion of responsibility for the expenses incurred during the next 13 or 14 years for the benefit of the children. The division of property has also been influenced somewhat by the Defendant’s pattern of avoidance in coming to grips with the property issues associated with the divorce....

It is clear the trial court considered the Rujf-Fischer guidelines in distributing the parties’ property. In this case, the trial court took into account David’s greater earning abilities, his conduct during the marriage, and the need for adequate housing for the children. Because the valuation of the video store was within the range of evidence, and because any disparity in the property distribution was adequately explained, the trial court’s property distribution was not clearly erroneous.

IV

[¶ 17] David argues the trial court improperly calculated his child support obligation when it attributed to him an income level equal to what he was earning in 1998 and 1999, even though it acknowledged he is not presently capable of earning that amount because of chemical dependency and the destruction of the Bismarck video store location.

[¶ 18] Section 14-09-09.7 of the North Dakota Century Code mandates the department of human services establish child support guidelines and creates the rebutta-ble presumption the amount of support designated in the guidelines is correct. Chapter 75-02-04.1 of the North Dakota Administrative Code establishes these child support guidelines.

Child support determinations involve questions of law which are subject to the de novo standard of review, findings of fact which are subject to the clearly erroneous standard of review, and may, in some limited areas, be matters of discretion subject to the abuse of discretion standard of review. A court errs as a matter of law when it fails to comply with the requirements of the child support guidelines in determining an obli-gor’s child support obligation. As a matter of law, the trial court must clearly set forth how it arrived at the amount of income and level of support. The trial court’s findings of fact in making its child support determination are overturned on appeal only if they are clearly erroneous. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if no evidence exists to support it, or if, on the entire record, we are left with a definite and firm conviction that a mistake has been made. Findings are adequate if we can understand from them the factual basis for the court’s determination.

Minar v. Minar, 2001 ND 74, ¶ 10, 625 N.W.2d 518 (citations omitted).

[¶ 19] To determine child support, a court must first calculate an obligor’s gross income. Hoverson v. Hoverson, 2001 ND 124, ¶ 35, 629 N.W.2d 573. Gross income is income from any source, in any form. N.D. Admin. Code § 75-02-04.1-01(5). An obligor’s net income is then used to compute the child support obligation. Id. § 75-02-04.1-02(3). “A proper finding of net income is essential to determine the correct amount of child support under the child support guidelines.” Hoverson, at ¶ 35. Net income is defined as gross income less various deductions and exemptions. N.D. Admin. Code § 75-02-04.1-01(7). “Courts, by necessity, rely on past information about a child support obligor’s income when calculating child support amounts.” Helbling v. Helbling, 541 N.W.2d 443, 447 (N.D.1995). “Past income is generally the best predictor of future income and child support is based upon income.” Id. The child support guidelines clearly express this principle in N.D. Admin. Code § 75-02-04.1-02(8), which provides:

Calculations made under this chapter are ordinarily based upon recent past circumstances because past circumstances are typically a reliable indicator of future circumstances, particularly circumstances concerning income. If circumstances that materially affect the child support obligation áre very likely to change in the near future, consideration may be given to the likely future circumstances.

“The guidelines thus amplify the direction to use the most recent information available by allowing use of circumstances that are very likely to change ‘in the near future’ that ‘materially affect the child support obligation.’ ” Mahoney v. Mahoney, 1997 ND 149, ¶ 17, 567 N.W.2d 206.

[¶ 20] The district court calculated David’s child support obligation based upon his 1998 and 1999 tax return figures and “impute[d] income to him at the level he was earning in 1998 and 1999” because David “frustrated the efforts of the Plaintiff and to some extent the Court in terms of evaluating his income situation based on a failure to provide adequate income records, even up to the point of trial.” David failed to provide his 2000 tax and income figures. “[A] court’s determination of an obligor’s income is dependent upon the evidence presented by the parties.” Schumacher v. Schumacher, 1999 ND 149, ¶ 35, 598 N.W.2d 131. In setting the child support obligation, the trial court was required to use the most recent information available. See Mahoney, 1997 ND 149, ¶ 17, 567 N.W.2d 206 (holding the child support guidelines “amplify the direction to use the most recent information available ...”); see also Helbling, 541 N.W.2d at 447 (holding “[c]ourts, by necessity, rely on past information about ... income ... ”). David failed to make a reasonable effort to provide the requested income information. “We will not permit a party to take advantage of his duplicity at the trial court level to urge error on appeal.” Anderson v. Anderson, 504 N.W.2d 569, 571 (N.D.1993). “If the obligor fails, upon reasonable request made in any proceeding to establish a child support obligation, to furnish reliable information concerning the obligor’s gross income from earnings, income based on earning capacity equal to the greatest of subdivisions a through c of subsection 3 must be imputed.” N.D. Admin. Code §§ 75-02-04.1-07(7). Subdivisions a., b., and c. of N.D. Admin. Code § 75-02-04.1-07(3) provide the greatest is to be imputed:

a.An amount equal to one hundred sixty-seven times the hourly federal minimum wage.
b. An amount equal to six-tenths of prevailing gross monthly earnings in the community of persons with similar work history and occupational qualifications.
c. An amount equal to ninety percent of the obligor’s greatest average gross monthly earnings, in any twelve consecutive months beginning on or after thirty-six months before commencement of the proceeding before the court, for which reliable evidence is provided.

Since neither party supplied information regarding subdivisions a. and b., the trial court is to impute income according to subdivision c. Because this proceeding was filed January 4, 2001, N.D. Admin. Code § 75-02-04.1-07(7) required that income be' imputed based upon David’s highest earnings in a consecutive twelve-month period, commencing on or after January 4, 1998, for which reliable evidence was provided. The highest twelve-month period for which reliable evidence was presented in this case is David’s 1999 income of $41,706. Accordingly, we reverse and remand with directions to .calculate child support based upon ninety percent of David’s 1999 income.

V

[¶ 21] The trial court did not abuse its discretion in denying the motion for a continuance and was not clearly erroneous in its property division. The trial court did err as a matter of law in calculating David’s child support obligation. We affirm the denial of the motion for continuance and property distribution. We reverse the child support order and remand with directions to calculate child support based upon ninety percent of David’s 1999 income. - ■

[¶ 22]GERALD W. VANDE WALLE, C.J, MARY MUEHLEN MARING, and WILLIAM A. NEUMANN, JJ.

SANDSTROM, Justice,

dissenting.

[¶ 23] I dissent to the majority’s affir-mance of the business asset value of $40,000, which is ’included in the marital estate and awarded to David Boehm.

[¶ 24] The majority writes a rationale of how the trial court could have achieved this result regarding the valuation of the business. The problem is, it is not what the trial court did, and what the trial court did is not permitted.

[¶ 25] The majority says, at ¶ 14:

The agreement between David and his father was styled as a “lease with option to purchase.” That description is not conclusive and we are not bound by it. Rather than being a lease with an option to purchase the video stores, the agreement is more akin to a conditional sale. In this instance, David has the capacity to realize a value from the agreement because he has the ability to complete the sale. Future interests may constitute intangible personal property which are marital assets subject to equitable distribution.

(Citations and footnote omitted). This is all fine and good, but it is not what the trial court found or did.

[¶26] What the majority conjures is refuted by the trial court’s Memorandum Opinion, at its Findings of Fact, Conclusions of Law, and Order for Judgment. In its Memorandum Opinion, the trial court writes:

I conclude that the record of the business arrangement between the defendant and his father indicates that he has little of value in terms of actual equity in the businesses, but am going to attribute the sum of $40,000 to him based on his experience and management abilities if he is able to continue the business relationship with his father.

(Emphasis added). In its Findings of Fact, Conclusions of Law, and Order for Judgment, the trial court says:

The case involves difficult issues regarding computation of the parties’ assets based on the unusual business relationship the Defendant had with his father, Albert Boehm. The Defendant’s father continues to be the owner of video store businesses in Bismarck and Dickinson, which the Defendant was leasing with certain purchase option provisions that would contemplate a buy-out of the businesses at a future date. The Plaintiff asserted that the businesses should be valued at their full value and attributed to the Defendant as a marital asset of $300,000. The destruction by fire of the major Hollywood Nites video business prior to the divorce trial, coupled with the apparent faltering nature of the business due to the Defendant’s failure to provide adequate management, or fulfill terms of the business arrangement, with his father, have left the impression that the business asset figure the Plaintiff proposes is significantly inflated. The record of the business arrangement between the Defendant and his father indicates that he has little of value in terms of actual equity in the businesses. The sum of $4-0,000 is attributed to him based on his experience and management abilities.

(Emphasis added).

[¶ 27] As the majority notes at ¶ 13, “Earning power is not, however, property that a court may divide as it would a parcel of land or a collection of household goods.” Nastrom v. Nastrom, 262 N.W.2d 487, 493 (N.D.1978). But that is what the trial court did when it included and distributed a “$40,000 asset” of David Boehm’s “experience and management abilities.” The trial court could not do it, but did. Therefore, I would reverse and remand on the issue.

[¶ 28] Dale V. Sandstrom

      . In Wall-work Lease and Rental Co., we held the test in determining whether an agreement is a lease or a conditional sale
      " 'is whether the option to purchase at the end of the lease term is for a substantial sum or a nominal amount ... [.] If the purchase price bears a resemblance to the fair market price of the property, then the rental payments were in fact designated to be in compensation for the use of the property and the option is recognized as a real one. On the other hand, where the price of the option to purchase is substantially less than the fair market value of the leased equipment, the lease will be construed as a mere cover for an agreement of conditional sale.' "

        Wallwork Lease and Rental Co., 303 N.W.2d at 547.


source: Caselaw Access Project

author: MARING, Justice.

license: Public Domain

text:
    2002 ND 148
    Frank ROSE, individually and on behalf of all others similarly situated, Plaintiff and Appellee, v. UNITED EQUITABLE INSURANCE COMPANY, United Equitable Life Insurance Company, Defendants, and Standard Life and Accident Insurance Company, Defendant and Appellant. Frank Rose, individually and on behalf of all others similarly situated, Plaintiff and Appellee, v. United Equitable Insurance Company, Defendant and Appellant, United Equitable Life Insurance Company, and Standard Life and Accident Insurance Company, Defendants.
    Nos. 20020094, 20020095.
    Supreme Court of North Dakota.
    Sept. 3, 2002.

      Monte L. Rogneby (argued) and H. Patrick Weir (on brief), Vogel Law Firm, Bismarck, ND, and Timothy Q. Purdon (appeared) and Thomas A. Dickson (on brief), Dickson & Purdon, Bismarck, ND, for plaintiff and appellee.
    Michael F. Braun (argued), Schuyler Roche & Zwirner, Chicago, IL, and Lawrence A. Dopson (appeared), Zuger Kirmis & Smith, Bismarck, ND, for defendant and appellant United Equitable Insurance Company.
    Stephen W. Plambeck (argued) and Daniel J. Crothers (appeared), Nilles, Hansen & Davies, Ltd., Fargo, ND, and Scott Daniel (on brief), Greer, Herz & Adams, L.L.P., Galveston, TX, for defendant and appellant Standard Life and Accident Insurance Company.
   MARING, Justice.

[¶ 1] United Equitable Insurance Company (“United Equitable”) and Standard Life and Accident Insurance Company (“Standard”) appealed from an order certifying a class action under N.D.R.Civ.P. 23. We affirm, concluding the district court did not abuse its discretion in certifying the class action.

I

[¶ 2] In 1982, Frank Rose purchased a guaranteed renewable nursing home insurance policy from United Equitable. United Equitable Life Insurance Company (“United Life”), the parent company of United Equitable, sold identical nursing home policies in North Dakota. In 1986, Standard acquired all of the nursing home insurance policies which United Equitable and United Life had issued in North Dakota. After that date none of the three companies issued similar nursing home policies in North Dakota, a practice known as “closing the block” of business for those North Dakota policyholders.

[¶ 3] In 2000, Rose sued United Equitable, Standard, and United Life, on his own behalf and for others similarly situated, alleging constructive fraud, actual fraud, consumer fraud, false advertising, and negligent misrepresentation. Rose alleges the insurers knew at the time the policies were issued that they were improperly underwritten and defectively un-derpriced. Rose claims the insurers intentionally marketed the policies with knowledge that exorbitant increases in renewal premiums would be necessary in future years of the policies. Rose further claims the insurers misrepresented the reasons for the numerous premium increases, intending these increases to induce policyholders to drop their coverage, and never advised policyholders they had “closed the block” on the nursing home policies. Rose claims the combination of higher premiums and a shrinking pool of insureds to share increased costs of claims resulted in a “death spiral” or “selection spiral,” with premiums, increasing so dramatically that the remaining policyholders are unable to pay and are forced to relinquish their policies.

[¶ 4] In November 2000, the district court granted the insurers’ motion to dismiss the complaint, concluding Rose’s claims were barred by the statute of limitations. Rose appealed, and we reversed and remanded for further proceedings. Rose v. United Equitable Ins. Co., 2001 ND 154, 632 N.W.2d 429. On remand, the district court granted class certification, including within the class all policyholders who had purchased certain nursing home policies in North Dakota from the insurers. United Equitable and Standard have appealed, alleging the district court abused its discretion in granting class certification.

II

[¶ 5] An order certifying a class action under N.D.R.Civ.P. 23 is appealable. Ritter, Laber & Assocs., Inc. v. Koch Oil, Inc., 2000 ND 15, ¶ 3, 605 N.W.2d 153 (“Ritter I”); Werlinger v. Champion Healthcare Corp., 1999 ND 173, ¶ 6, 598 N.W.2d 820. The trial court has broad discretion in determining whether to certify a class action under N.D.R.Civ.P. 23. Klagues v. Maintenance Eng’g, 2002 ND 59, ¶ 6, 643 N.W.2d 45; Ritter I, at ¶ 4. The trial court’s decision to certify a class action will not be overturned on appeal unless the court has abused its discretion. Klagues, at ¶ 6; Ritter I, at ¶ 4. A trial court abuses its discretion only when it acts in an unreasonable, arbitrary, or unconscionable manner, when its decision is not the product of a rational mental process leading to a reasoned decision, or when it misinterprets or misapplies the law. Klagues, at ¶ 6; Ritter I, at ¶ 4.

[¶ 6] We have traditionally construed N.D.R.CÍV.P. 23 to provide an open and receptive attitude toward class actions. Ritter, Laber & Assocs., Inc. v. Koch Oil, Inc., 2001 ND 56, ¶ 5, 623 N.W.2d 424 (“Ritter II”); Ritter I, 2000 ND 15, ¶ 3, 605 N.W.2d 153; Werlinger, 1999 ND 173, ¶ 7, 598 N.W.2d 820. In reviewing an order granting certification, we are guided by the broad and liberal public policy in favor of class actions in this state:

Decisions as to whether class action status should be allowed seem to rest, more than many other judicial determinations, on judicial philosophy, rather than on precedent or statutory language. ...
We will interpret Rule 23 so as to provide an open and' receptive attitude toward class actions.
We believe that Rule 23 is a remedial rule which “continues to have as its objectives the efficient resolution of the claims or liabilities of many individuals in a single action, the elimination of repetitious litigation and possibly inconsistent adjudications involving common questions, related events, or requests for similar relief, and the establishment of an effective procedure for those whose economic position is such that it is unrealistic to expect them to seek to vindicate their rights in separate lawsuits.” Wright & Miller, Federal Practice and Procedure: Civil § 1754.

Peterson v. Dougherty Dawkins, Inc., 1998 ND 159, ¶ 10, 583 N.W.2d 626 (quoting Rogelstad v. Farmers Union Grain Terminal Ass’n, 226 N.W.2d 370, 376 (N.D.1975)).

[¶ 7] A trial court may certify a class action under N.D.R.Civ.P. 23 if the following four requirements are satisfied:

1. The class is so numerous or so constituted that joinder of all members, whether or not otherwise required or permitted, is impracticable;
2. There is a question of law or fact common to the class;
3. A class action should be permitted for the fair and efficient adjudication of the controversy; and
4. The representative parties fairly and adequately will protect the interests of the class.

Klagues, 2002 ND 59, ¶ 7, 643 N.W.2d 45; see also Ritter II, 2001 ND 56, ¶ 6, 623 N.W.2d 424; Ritter I, 2000 ND 15, ¶ 5, 605 N.W.2d 153; Peterson, 1998 ND 159, ¶ 11, 583 N.W.2d 626.

[¶ 8] There is no real dispute that factors (1) and (2) are satisfied in this case. The class consists of some 8,000 policyholders who purchased nursing home policies from the insurers in North Dakota, so joinder of all parties would be impracticable. The claims all relate to alleged fraudulent underwriting of the policies and fraudulent misrepresentations to policyholders in uniform written communications from the insurers. There are clearly questions of law and fact common to the class. The dispute in this case focuses upon factors (3) and (4): the insurers argue the trial court abused its discretion in determining that a class action will provide a fair and efficient adjudication and in concluding that Rose can adequately represent the class.

Ill

[¶ 9] Rule 23(c)(1), N.D.R.Civ. P., lists thirteen factors for the trial court to consider in determining whether a class action will provide a fair and efficient adjudication of the controversy. Klagues, 2002 ND 59, ¶ 8, 643 N.W.2d 45; Ritter I, 2000 ND 15, ¶ 10, 605 N.W.2d 153. The trial court must weigh the competing factors, and no one factor predominates over the others. Klagues, at ¶ 8; Ritter I, at ¶ 10. The court need not specifically address all thirteen factors. Werlinger, 1999 ND 173, ¶ 56, 598 N.W.2d 820; Peterson, 1998 ND 159, ¶ 14, 583 N.W.2d 626. As we noted in Peterson, at ¶ 15:

In most cases some of the thirteen factors will weigh against certification and some will weigh in favor. It is for the trial court, employing its broad discretion, to weigh the competing factors and determine whether a class action will provide a fair and efficient adjudication of the controversy. Thus, even if Dougherty is correct in its assertion four of the factors weigh against certification, that does not preclude the court from certifying the class action if, in its opinion, those factors are outweighed by other factors supporting certification.

A

[¶ 10] The insurers contend the trial court erred by “mechanically” determining that a majority of the thirteen factors favored class certification. The insurers argue that the court applied a purely mathematical calculation and did not understand that it could give some factors more weight than others:

Unfortunately, the court below misapplied this test and instead of weighing the various factors to determine whether on balance they favored or disfavored class certification, the court simply added up the number of factors that it concluded favored class certification and determined that more factors favored class certification than disfavored class certification. As a consequence, the court’s Order simply notes “a majority of the thirteen factors weigh in favor of certification.” In reaching this result, the court appears to have eliminated completely the essential judicial function of weighing the factors. Instead, the court applied an erroneous, mechanical, mathematical test of whether 7 or more of the 13 factors favor class certification. By so doing, the court determined that the class should be certified without consideration of the relative weight that any of the factors might have in this particular case. Indeed, it cannot be determined from the court’s opinion whether the court gave all factors equal weight or even if the court understood that it could (and should if appropriate) weigh some factors more heavily than others.

[¶ 11] , The insurers have read the trial court’s remarks out of context and have misinterpreted its conclusion. Although the court stated a “majority” of the factors favor certification, there is no indication that the court simply tallied up which side had numerically more factors and declared a winner. A reading of the court’s entire order clearly demonstrates the court was well aware of the appropriate standards for considering the thirteen factors and correctly applied those standards,

[¶ 12] Before addressing the thirteen factors, the court in its memorandum opinion and order first quoted the standards from our prior cases, acknowledging that in most cases some factors will weigh against certification and some in favor, and that the court must weigh the competing factors to determine whether a class action will provide a fair and efficient adjudication of the controversy. The court then thoroughly addressed each of the thirteen factors, covering twelve pages of its opinion, and determined that some weighed against certification, some weighed in favor, and some were inapplicable. In reaching its conclusion, the court did not provide a mathematical result of how many factors were for or against certification. Although the court’s unfortunate choice of words indicated a “majority” of the factors weighed in favor of certification, a thorough reading of the court’s opinion clearly shows the court was aware it was to weigh all of the factors, and was not required to give equal weight to each factor, in determining whether a class action would provide a fair and efficient adjudication. Applying that standard, the court concluded a class action would provide a fair and efficient adjudication in this case.

B

[f 13] One of the thirteen factors the court must consider is “whether common questions of law or fact predominate over any questions affecting only individual members.” N.D.R.Civ.P. 23(c)(1)(E). The insurers contend the trial court erred in concluding common questions predominate over individual questions in this case.

[¶ 14] The trial court may conclude that common questions predominate even if there are significant individual questions to be resolved:

There is no precise test governing the determination of whether common questions predominate over individual claims. Rather, a pragmatic assessment of the entire action and all of the issues is involved in making the determination. For common questions to predominate, it is not necessary the individual claims be carbon copies of each other. “Predominate” should not be automatically associated with “determinative” or “significant,” and consequently when one or more central issues to the action are common and can be said to predominate, the class action will be proper. Class certification is not to be refused merely because individual issues will remain even after disposition of common issues. The common issues need not dispose of the case, and the presence of individual issues is of no obstacle to proceeding as a class action.

Werlinger, 1999 ND 173, ¶ 33, 598 N.W.2d 820 (citations omitted); see also Klagues, 2002 ND 59, ¶ 19, 643 N.W.2d 45; Ritter I, 2000 ND 15, ¶ 22, 605 N.W.2d 153; Peterson, 1998 ND 159, ¶¶ 21-22, 583 N.W.2d 626.

[¶ 15] The insurers argue there will be numerous individual issues remaining after the common issues have been determined. Our prior cases, however, make it clear class certification need not be refused on that basis alone. See, e.g., Klagues, 2002 ND 59, ¶ 19, 643 N.W.2d 45; Werlinger, 1999 ND 173, ¶ 33, 598 N.W.2d 820. Class certification is not automatically precluded by the existence of individual issues which will remain after the common questions of law and fact have been resolved.

[¶ 16] The insurers also contend that, for purposes of'determining whether common issues predominate, this case ⅛ governed by Saba v. County of Barnes, 307 N.W.2d 590 (N.D.1981). In Saba, this Court concluded the trial court did not abuse its discretion in determining that individual questions predominated over common questions where complex individual questions of proximate cause and damages would remain after the common questions were resolved.

[¶ 17] The insurers’ argument ignores the highly deferential standard of review we employ in reviewing a trial court’s decision to certify a class action. This Court in Saba held only that the trial court had not abused its discretion in determining individual questions predominated over common ones. The Court did not hold that, as a matter of law, that result was required. A decision in which we affirmed a trial court’s denial of certification on the abuse of discretion standard is readily distinguishable when the current appeal is from an order certifying a class action. See Ritter I, 2000 ND 15, ¶ 24, 605 N.W.2d 153. By definition, when a matter is left to the broad discretion of the trial court, it is envisioned there is a broad range of factual scenarios in which the trial court is left to make its choice, and whichever choice it makes will be upheld on appeal. This case presented many close questions and difficult choices, and it was for the trial court to make those choices without interference from this Court on appeal unless there has been an abuse of discretion.

[¶ 18] We also note that many of the insurers’ alleged individual issues are at this point merely speculative, and will depend upon further development of the facts as the case progresses. The trial court has the authority to decertify, create subclasses, or modify the class if the case ultimately proves unmanageable in its present form:

Under N.D.R.Civ.P. 23(b), a trial court generally considers issues about certification of a class action “as soon as practicable after the commencement of a class action,” and at that stage of the proceeding, issues regarding a joint or common interest may not be fully crys-talized. A trial court may' amend a certification order at any time before entry of judgment on the merits. N.D.R.Civ.P. 23(e). Under similar language in Fed.R.Civ.P. 23(c)(1), federal trial courts are free to decertify, sub-classify, or modify a class certification previously granted. In Richardson [v. Byrd, 709 F.2d 1016, 1019 (5th Cir.1983)], the court aptly explained a federal trial court “must define, redefine, subclass, and decertify as appropriate in response to the progression of the case from assertion to facts.”

Ritter II, 2001 ND 56, ¶ 16, 623 N.W,2d 424 (citations omitted).

[¶ 19] We conclude the trial court did not abuse its discretion in determining common questions predominated over individual questions, and the court did not abuse its discretion in determining a class action will provide a fair and efficient adjudication of the controversy in this case.

W

[¶ 20] The insurers contend the trial court erred in concluding Rose could adequately represent the class.

[¶ 21] In order to certify a class action, the trial court must find that the representative party or parties “fairly and adequately will protect the interests of the class.” N.D.R.Civ.P. 23(b)(2)(C); see also Werlinger, 1999 ND 173, ¶ 19, 598 N.W.2d 820. Rule 23(c)(2) sets the framework for the trial court’s determination whether the class representative can fairly and adequately represent the class:

In determining under subdivision (b)(2) that the representative parties fairly and adequately. will protect the interests of the class, the court must find that:
(A) the attorney for the representative parties will adequately represent the interests of the class;
(B). the representative parties do not have a conflict of interest in the maintenance of the class action; and
(C)the representative parties have or can acquire adequate financial resources, considering subdivision (q), to assure that the interests of the class will not be harmed.

The determination whether the party will fairly and adequately represent the interests of the class lies within the discretion of the trial court, and its decision will not be overturned on appeal absent an abuse of that discretion. See Klagues, 2002 ND 59, ¶ 26, 643 N.W.2d 45; Werlinger, at ¶¶ 23, 25.

[¶ 22] The trial court thoroughly addressed each of the three requirements under N.D.R.Civ.P. 23(c)(2) and concluded Rose’s attorneys will adequately represent the interests of the class, Rose did not have any conflict of interest in representing the class, and Rose had or could acquire adequate financial resources to maintain the class action. We conclude the trial court did not abuse its discretion in determining that Rose can fairly and adequately represent the interests of the class..

V

[¶23] We have considered the remaining issues raised by the parties, including the insurers’ due process claim, and we conclude they are either unnecessary to our decision or are without merit. Parties mounting constitutional challenges should bring up the heavy artillery or fore-go the attack entirely. State v. Clark, 2001 ND 194, ¶ 9, 636 N.W.2d 660; State v. Kensmoe, 2001 ND 190, ¶ 19, 636 N.W.2d 183.

[¶ 24] We affirm the order certifying the class action.

[¶ 25] GERALD W. VANDE WALLE, C.J., WILLIAM A. NEUMANN, and DALE V. SANDSTROM, JJ., and WILLIAM F. HODNY, S.J, concur.

[¶ 26] The Honorable WILLIAM F. HODNY, S.J., sitting in place of KAPS-NER, J., disqualified.

      . Rose's claims are set out in greater detail in Rose v. United Equitable Ins. Co., 2001 ND 154, ¶¶ 3-4, 632 N.W.2d 429.

      .. United Life is currently in receivership and has been dismissed from this action.


author: AMUNDSON, Justice. ZINTER, Justice

text:
    2002 SD 108
    Kevin LEISINGER, Plaintiff and Appellee, v. Cheryl D. JACOBSON, Defendant and Appellant.
    No. 22086.
    Supreme Court of South Dakota.
    Considered on Briefs April 22, 2002.
    Decided Aug. 21, 2002.

      Wilson Kleibacker and Daniel J. Brown of Lammers, Lammers & Kleibacker, Madison, South Dakota, Attorneys for plaintiff and appellee.
    Patricia A. Meyers of Costello, Porter, Hill, Heisterkamp, Bushnell & Carpenter, Rapid City, South Dakota, Attorneys for defendant and appellant.
   AMUNDSON, Justice.

[¶ 1.] Kevin Leisinger (Kevin), Appel-lee/Plaintiff, sued his former spouse, Cheryl Jacobson (Cheryl), Appellant/Defendant, for malicious prosecution. A jury awarded Kevin compensatory and punitive damages. Cheryl appeals. We affirm in part, reverse in part and remand.

FACTS

[¶ 2.] This case is a result of what Cheryl describes as an “acrimonious” divorce. After the decision in the divorce proceedings, Kevin sued Cheryl for malicious prosecution based on conduct that occurred during the pendency of the divorce. Evidence at the malicious ■ prosecution jury trial indicated that on-March 6, 1997, after Cheryl started divorce proceedings, both parties remained in the marital home and an argument ensued. Kevin testified that he called 911 after Cheryl grabbed something out of his hands and threw it at him. Cheryl testified that Kevin had grabbed for her neck and her necklace broke. Law enforcement arrived and Cheryl,, allegedly following advice of divorce counsel who she had called just prior to the arrival of the police, filed a complaint charging Kevin with simple assault. Kevin was' arrested and kept in police custody over night. The following day, Cheryl filed for a temporary restraining order. Prosecution later dismissed the charge.

[¶ 3.] Additionally, testimony showed that on March 18, 1997, a hearing was held and a protection order prohibiting physical and verbal contact, as well as harassment and threats, was issued. Despite Cheryl’s request for such an order, Kevin claims Cheryl initiated phone contact with him several times. Subsequently, on March 25, 1997, both parties ended up in the same bar in Sioux Falls, South Dakota. Cheryl alleged that Kevin had been watching her, so she' called the police. Kevin claimed he was .to -meet someone there, but upon discovering Cheryl in the bar, he turned around and left. Cheryl called the police and reported the incident. A criminal complaint was- filed, but the charge stemming from this event was dismissed.

[¶4.] The jury was presented with a series of other complaints filed following the initiation of divorce proceedings. On May 9, 1997, Cheryl filed a complaint after Kevin approached her at the Minnehaha County Courthouse. There were also several charges for violation of the protection order filed when Kevin allegedly placed mail in Cheryl’s mailbox and made phone calls to Cheryl. According to Kevin, however, many of the calls were made in an effort to talk to his daughter and Cheryl initiated conversations with him.

[¶ 5.] On June 11, 1997, the protection order was suspended. On July 9, 1997, Cheryl alleged that Kevin approached her in a Sioux Falls restaurant, followed her and their daughter home and stood on the front step yelling and beating on the front door. Kevin was charged.with disorderly conduct for these actions, not a violation of the protection order because it was no longer in place. He was later acquitted. In fact, all of the charges at issue in the malicious prosecution lawsuit were either dismissed, or Kevin was found not guilty of committing the criminal act alleged.

[¶ 6.] Kevin testified that during one of the phone conversations between the parties, Cheryl stated that Kevin was to give her the farm, which had been her family’s farmstead, and $100,000 in cash for the divorce settlement, or she would have him arrested. He also alleged that Cheryl drove by his work place and approached him at work, and initiated much of the contact that occurred between the two. He further claimed Cheryl orchestrated the protection order, and violations of it, to obtain leverage against him in the divorce.

[¶ 7.] On May 23, 2001, a jury entered a judgment in favor of Kevin, awarding him $13,754.67 in compensatory damages and $120,000 in punitive damages. Cheryl appeals the following issues:

1) Whether the trial court should have instructed the jury regarding prosecutorial discretion by the state’s attorney.
2) Whether the trial court should have set aside the punitive damage award as unreasonable and excessive.

STANDARD OF REVIEW

[¶ 8.] When addressing whether the trial court erred in its decision on what jury instructions should have been given at the conclusion of the evidentiary phase of trial, we apply the following standard of review:

On issues supported by competent evidence in the record, the trial court should instruct the jury. The trial court is not required to instruct on issues lacking support in the record. Failure to give a requested instruction that correctly sets forth the law is prejudicial error. Jury instructions are reviewed as a whole and are sufficient if they correctly state the law and inform the jury. Error is not reversible unless it is prejudicial. The burden of demonstrating prejudice in failure to give proposed instructions is on the party contending error. This Court has repeatedly stated that “[a] trial court must present only those instructions to the jury which are supported by competent evidence and set forth the applicable law.”

Parker v. Casa Del Rey-Rapid City, Inc., 2002 SD 29, ¶ 5, 641 N.W.2d 112, 115 (citation omitted).

[¶ 9.] In excessive punitive damages review, we have stated that we consider the following: “[Is] the verdict ... so large as to clearly indicate that it must have been given under the influence of passion or prejudice ... [?[?] ” Grynberg v. Citation Oil & Gas Corp., 1997 SD 121, ¶ 36, 573 N.W.2d 493, 504. We have further said that to overturn the jury verdict on punitive damages, the amount “must be so excessive as to strike mankind, at first blush, as being, beyond all measure unreasonable and outrageous, and such as manifestly show the jury to have been actuated by passion, partiality, prejudice or corruption. In short, the damages must be flagrantly outrageous and extravagante.]” Flockhart v. Wyant, 467 N.W.2d 473, 479 (S.D.1991). Today, we are not disagreeing with our previous statements, but we clarify this standard of review by adopting the abuse-of-discretion standard, which has been implemented by other courts when reviewing punitive damages awards.

DECISION

[¶ 10.] 1) Whether the trial court should have instructed the jury regarding prosecutorial discretion by the state’s attorney.

[¶ 11.] At trial, Cheryl proposed two instructions, which were rejected by the trial judge. Defendant’s proposed instruction number 22 states that “[t]he fact that a criminal charge is dismissed by the prosecutor is not, standing alone, sufficient evidence that probable cause is lacking.” De: fendant’s proposed instruction number 23 says:

You are instructed that if the defendant merely states what is believed, leaving the decision to prosecute entirely to the uncontrolled discretion of the officer, or if the officer makes independent investigation, the defendant is not regarded as having instigated the proceeding.

In denying these instructions, the trial court held that the court’s instructions correctly set forth the law to be applied by the jury in this malicious prosecution case.

[¶ 12.] The following elements must be proven to establish a claim for malicious prosecution:

(1) the commencement or continuance of an original criminal or civil judicial proceeding; (2) its legal causation by the present defendant against plaintiff, who was defendant in the original proceedings; (3) its bona fide termination in favor of the present plaintiff; (4) the absence of probable cause for such proceeding; (5) the presence of malice; and .(6) damages conforming, to legal standards resulting to plaintiff.

Kaarup v. St. Paul Fire and Marine Ins. Co., 485 N.W.2d 802, 804 (S.D.1992). Malicious prosecution is a prosecution “begun in malice, without probable cause to believe it can succeed, and which finally ends in failure.” Specialty Mills, Inc. v. Citizens State Bank, 1997 SD 7, ¶ 9, 558 N.W.2d 617, 620. See also Manuel v. Wilka, 2000 SD 61, ¶ 18, 610 N.W.2d 458, 462 (defining elements of malicious prosecution); Michlitsch v. Meyer, 1999 SD 69, ¶ 19, 594 N.W.2d 731, 735 (same). If the plaintiff fails to prove any of these six elements, he fails in proving his claim. Miessner v. All Dakota Ins. Assoc., Inc., 515 N.W.2d 198, 200 (S.D.1994).

[¶ 13.] In deciding whether the jury was adequately instructed on the applicable laws involved in the malicious prosecution claim, we follow a “two prong approach” for review: “A party challenging as erroneous a jury instruction must show not only ‘that the instruction was in error, but also that it was prejudicial error to the effect that under the evidence, the jury ... probably would have returned a different verdict.’ ” Rantapaa v. Black Hills Chair Lift Co., 2001 SD 111, ¶ 17, 633 N.W.2d 196, 202 (quoting City of Sioux Falls v. Hone Family Trust, 1996 SD 126, ¶ 11, 554 N.W.2d 825, 827 (citations omitted)).

[¶ 14.] In this case, the trial court instructed on the elements of malicious prosecution, along with all the definitions to be applied to that claim. Cheryl argues that instruction number 23 should have been given because it presents language closely modeling our language in previous cases. In Miessner, we said:

If the defendant merely states what is believed, leaving the decision to prosecute entirely to the uncontrolled discretion of the officer, or if the officer makes an independent investigation, or prosecutes for an offense other than the one charged by the defendant, the latter is not regarded as having instigated the proceeding.

515 N.W.2d at 201. We have acknowledged that if the State’s prosecutors do their own investigation, prepare the complaint, or if an informer only tells law enforcement about a possible offense, the informant is not liable for malicious prosecution. See Weber v. Western Bank, 336 N.W.2d 652, 653 (S.D.1983); Malloy v. Chicago, M. and St. P. Ry. Co., 34 S.D. 330, 148 N.W. 598 (1914). If the defendant is not “the proximate and efficient cause of maliciously putting the law in motion,” but rather the state’s attorney or an officer of the law pushes the prosecution forward, that defendant is not liable. Malloy, 148 N.W. at 600. Thus, the proposed instructions at issue are not untrue statements. They were, however, unnecessary considering the evidence presented at trial. See Parker, 2002 SD 29 at ¶ 14, 641 N.W.2d at 115 (stating the trial court must only instruct on issues “supported by competent evidence” (citation omitted)). Other than Cheryl’s own testimony, no witness indicated that the prosecution did its own investigation or made charges other than those Cheryl complained of, or in any way did an independent prosecution. Thus, the record did not support proposed instruction 23.

[¶ 15.] Furthermore, instruction 22 only stated that dismissal of prosecution, in and of itself, is insufficient to prove probable cause is lacking. This, too, is a true statement, but we agree with the trial judge that based on the case he heard, the instructions given explained the applicable law. During the settlement of instructions, the trial judge reasoned:

I will deny instruction 22 .... The issue of whether probable cause is lacking is a fact question for the jury and the other instructions taken as a whole clearly state the law. So this instruction is not necessary and could lead to confusion in this case. So I’ll deny 22.
Twenty-three .... [This language from the] Meissner case was not the holding of the court but was dicta citing [Keeton, Prosser and Keeton on the Law of Torts § 119 (5th ed.1984)] as is written and as applied to the facts in this case. It is not a complete statement of law and the instructions on malicious prosecution ... which lists the elements that would give plaintiff the ability to argue the factual issues without this instruction. So 23 is denied.

Clearly, the defense was not precluded from explaining to the jury that probable cause existed for her complaints or that once she called police and reported the various alleged crimes, it was out of her hands. There is no evidence in the record regarding the prosecution’s decision to dismiss the complaint; no prosecuting attorney was questioned in front of the jury and no officer of the law was asked why the charges against Kevin never resulted in convictions. Under our laws, if a party fails to present evidence or witnesses, such nonproduction justifies an inference that the evidence would be unfavorable. Cody v. Leapley, 476 N.W.2d 257, 264 (S.D.1991). “The nonproduction or suppression by a party of evidence which is within his power to produce and which is material to an issue in the case justifies the inference that it would be unfavorable to him if produced.” Id. See also 29 Am.Jur.2d Evidence § 245 (1994) (stating “[a]n inference may be drawn that withheld evidence would be unfavorable if it is relevant evidence which would properly be part of a case is within the control of the party whose interest it would naturally be to produce it”).

[¶ 16.] We conclude that on this record the instructions in the case “provided a full and correct statement of the law.” Thomas v. Stilly Co., 2001 SD 73, ¶ 4, 629 N.W.2d 590, 591 (quoting Veeder v. Kennedy, 1999 SD 23, ¶ 32, 589 N.W.2d 610, 618).

[¶ 17.] 2) Whether the trial court should have set aside the punitive damage award as unreasonable and excessive.

[¶ 18.] Cheryl’s second point of contention is the punitive, damage award. In his complaint, and through his testimony at trial, Kevin requested $13,754.67. in actual damages, $50,000.00 for intentional infliction of emotional distress and $50,000.00 in punitive damages. The verdict form for the plaintiff first provided for the award of actual damages and’ left a blank line. The jury filled $13,754.67 in the blank. Next, the form said “we, the jury ... find that punitive ’ damages should be allowed and award Plaintiff punitive damages of and from the Defendant in the sum of $_” The jury entered the amount of $120,000.00 in the blank, more than Kevin asked for in emotional distress and punitive damages combined. The form did not, however, ask for a break down of punitive and emotional distress damages, and no instruction explained the law of intentional infliction of emotional distress to the jury. Therefore, the jury obviously awarded $120,000 in punitive damages.

[¶ 19.] This Court has established a fivé-factor test for determining whether punitive damages are appropriate or excessive. Grynberg, 1997 SD 121 at ¶ 37, 573 N.W.2d at 504.

We consider: (1) the amount allowed in compensatory damages, (2) the nature and enormity of the wrong, (3) the intent of the wrongdoer, (4) the wrongdoer’s financial condition, and (5) all of the circumstances attendant to the wrongdoer’s actions.

Id.

[¶ 20.] Under the first factor, we have said that there must be “‘a reasonable relationship’ between the punitive damages and compensatory damages[,]” but that there is no “precise mathematical ratio between” the two. Id. at 38 (citation omitted). We acknowledge that it is difficult to see the relationship between the $120,000.00 granted in punitive damages and the $13,754.67 granted in actual damages, a ratio of approximately 9 to 1. In Grynberg, we acknowledged that the ratio there was 13.5 to 1, and noted it was “cause for concern” but proceeded to analyze the four other factors to put the ratio in perspective. Id. We do the same here.

[¶ 21.] The second factor requires us to analyze the enormity of the wrong. While we do not condone malicious prosecution, the record demonstrates behavior often exhibited in an acrimonious divorce. And, although the jury determined malicious prosecution occurred, Kevin’s actions do not appear' to be entirely angelic. Witnesses testified regarding some of his less than cordial behavior towards Cheryl, one of whom was the parties’ daughter. Com sidering the underlying situation, it is extremely difficult for us to do a thorough analysis of this factor. Based on the conflicting testimony in the record, it is also difficult to analyze Cheryl’s intent. In an analysis of the fifth factor, the circumstances attendant to the wrongdoer’s actions, we have previously looked at the “the availability of other sanctions, including those under our criminal code” and “deterring future misconduct.” Id. at ¶¶ 46-47. This record reveals no showing of any alternative sanctions to be considered.

[¶ 22.] The fourth factor, the financial condition of the wrongdoer, plays the most vital role in this ease based on the evidence at trial. During trial, Kevin testified regarding Cheryl’s financial well being. He stated that Cheryl received a significant award of property in the divorce. He then submitted a list of the property Cheryl received in the divorce into evidence, and pointed out that the property was worth $299,174.90. Kevin testified that, in his opinion, the real estate Cheryl received “was worth more than what the judge at the [divorce] trial determined.” He went on to state that a gravel pit on the property alone exceeded $300,000 and that the house Cheryl received was worth “a good portion of that.” Cheryl submitted some testimony about having to sell a portion of her property to pay attorney fees and testified about the mortgage on her home and the fact that she received $1,000 in monthly alimony, but little else established her net worth, or even gave a fair estimation of it. Moreover, assuming the only number backed by evidence at trial is accurate, the $299,174.90 Cheryl received in the divorce settlement, $120,000.00 punitive award is over forty percent of the amount she received in the divorce. In Grynberg we determined the punitive damages equal to ten percent of the defendant’s entire net would create too drastic of a financial impact on the defendant to justly uphold the verdict. Id. at ¶ 45.

[¶ 23.] We have said that “[p]unitive damages must not be so oppressive or so large as to shock the sense of fair-minded persons.” Schaffer v. Edward D. Jones & Co., 1996 SD 94, ¶ 27, 552 N.W.2d 801, 810. We usually leave the question of when punitive damages should be awarded and in what amount up to juries, but the lack of evidence regarding Cheryl’s financial condition, in conjunction with the enormity of the amount of punitive damages is “flagrantly outrageous and extravagant” under the circumstances of this case. Flockhart, 467 N.W.2d at 479.

[¶ 24.] In past eases “where we have found the verdict not to be justified under our standard of review and rather based on passion or prejudice, we have reduced, or in the alternative if the reduction was not acceptable to the plaintiff, granted a new trial to the defendant.” Schaffer, 1996 SD 94 at ¶ 26, 552 N.W.2d at 810. See also Grynberg, 1997 SD 121 at ¶ 50, 573 N.W.2d at 508 (reducing punitive damages award); Shippen v. Parrott, 1996 SD 105, ¶ 29, 553 N.W.2d 503, 511 (same). Our decision to do so in this case is based on the fact that “the purpose,of punitive damages is to punish, not to permanently cripple or destroy.” Grynberg, 1997 SD 121 at ¶ 49, 573 N.W.2d at 508-09.

[¶ 25.] After considering all of the relevant factors, we conclude that the punitive damage award should be reduced to $25,000. Within 30 days from the date of this opinion, Kevin must file a written election with this Court to either accept or reject judgment in the sum of $25,000, together with interest at the legal rate from the date of judgment- of the trial court and costs in that court. If he accepts this amount, the judgment of the trial court will be affirmed. If Kevin does not so elect the above punitive damage award, the punitive damage judgment shall be reversed, and a new trial on punitive damages will be ordered. See Shippen, 1996 SD 105 at ¶ 30, 553 N.W.2d at 511 (reducing punitive damage award and giving plaintiff the choice to either accept the reduced amount with interest and court costs or electing a new trial- on punitive damages).

[¶ 26.] Affirmed in part, reversed in part and remanded.

[¶ 27.] GILBERTSON, Chief Justice, and SABERS and KONENKAMP, Justices, concur.

[¶ 28.] ZINTER, Justice, concurs specially.

ZINTER, Justice

(concurring specially).

[¶ 29.] I concur and write to note that additional record evidence also supports the trial court’s decision to not give proposed instructions # 22 and # 23. I also write to note one minor disagreement with the majority’s opinion on punitive damages.

[¶ 30.] With respect to the instructions, it should first be noted that there is additional evidence in this record that further justified the trial court’s general instructions rather than Cheryl’s more specific instructions. For example, there is evidence that a number of the underlying prosecutions were either “citizens arrests” in which Cheryl herself initiated the prosecution, or they were incidents where Cheryl admitted knowing that her complaint would result in a prosecution. This evidence clearly supported the trial court’s decision to not give Cheryl’s more specific instruction that only applied where the decision to prosecute was left “entirely to the uncontrolled discretion of the officer” (Cheryl’s proposed instruction # 23).

[¶ 31.] Additionally, there is record evidence that the motivation for some of Cheryl’s actions was .to gain leverage in her divorce proceeding. There was also evidence that Cheryl misrepresented material facts in some of the proceedings. All of this evidence supported the trial court’s decision to not give Cheryl’s more specific instruction that applied where the only evidence of malice was the dismissal of the criminal charge (Cheryl’s proposed instruction # 22).

[¶ 32.] With respect to the issue of punitive damages, I do not agree that the jury “obviously” awarded $120,000 in punitive damages. Supra at ¶ 18. Notwithstanding that disagreement, the remittitur is justified by the balance of the majority opinion.

      . The direct appeal in Leisinger v. Leisinger, 601 N.W.2d 283 (S.D.1999), was affirmed by an order directing issuance of judgment of affirmance.

      . In Cooper Indus., Inc. v. Leatherman Tool Group, Inc., the United States Supreme Court stated that when reviewing punitive damage awards, "[i]f ho constitutional issue is raised, the role of the appellate court, at least in the federal system, is merely to review the trial court's 'determination under an abuse-of-discretion standard.’ ” 532 U.S. 424, 433, 121 S.Ct. 1678, 1684, 149 L.Ed.2d 674 (2001) (citation omitted). Cooper held that "[c]ourts of appeals should apply a de novo standard when reviewing district court determinations of the constitutionality of punitive damages awards.” 532 U.S. at 424, 121 S.Ct. at 1679, 149 L.Ed.2d 674. Today, we choose to follow the courts that find the abuse of discretion standard applies to issues regarding excessive punitive damages unless the issue has been raised as a constitutional violation, which is reviewed de novo. See, e.g., Stroud v. Lints, 760 N.E.2d 1176, 1180 (Ind.App.2002) (holding abuse of discretion standard applies when determining whether punitive damages were properly awarded, and finding de novo review applies when constitutional violations are alleged); Time Warner Entm’t Co. v. Six Flags Over Georgia, L.L.C., et al., 254 Ga.App. 598, 563 S.E.2d 178, 182 (Ga.Ct.App.2002) (same). In this case, there is no argument that the excessive award resulted in a violation of the constitution, so the appropriate review is abuse of discretion.

      . The court’s instruction number 10 stated:
      When the expression "proximate cause,” which is sometimes called "legal cause,” is used, it means an immediate cause of any injury, which, in natural or probable sequence produces the injury complained of. Without the proximate cause, the injury would not occur. The proximate cause need not be the only cause, nor the last or nearest cause. It is sufficient if it concurs with some, other cause acting at the same time, which in combination with it causes the injury.
      For proximate cause to exist, you must find that the .harm suffered was a foreseeable consequence of the act complained of.
      Instruction number 12 given by the trial court stated:
      A malicious prosecution is one that is begun in malice, without probable cause to believe it can succeed, and which finally ends in failure. Malicious prosecution requires six elements:
      1. The commencement or continuance of an original criminal or civil judicial proceeding;
      2. Its legal causation by the present defendant against plaintiff, who was defendant in the original proceeding;
      3. Its bona fide termination in favor of the present plaintiff;
      4. The absence of probable cause for such proceeding;
      5. The presence of malice; and
      6. Damages conforming to legal standards resulting to plaintiff.

      . The appellee argues that the $120,000.00 was for punitive damages and intentional infliction of emotional distress damages. There was no instruction to the jury defining intentional infliction of emotioned distress, nor any provision on the plaintiff's verdict form for assessment of such damages. South Dakota pattern jury instruction 145-01 enumerating the elements of intentional infliction of emotional distress could have been presented to the jury. The elements, as described in the pattern instructions, are:
      (1) The defendant engaged in extreme and outrageous conduct. (2) [The defendant intended to cause the plaintiff severe emotional distress] or [The defendant acted recldessly causing the plaintiff severe emotional distress], (3) The defendant's conduct, in fact, caused plaintiff to suffer severe emotional distress. ’ (4) The plaintiff suffered an extreme disabling emotional response to the defendant's conduct.

        See also Maryott v. First Nat’l Bank of Eden, 2001 SD 43, ¶ 22, 624 N.W.2d 96, 104 (discussing elements of intentional infliction of emotional distress). Kevin presented no evidence regarding symptoms • of severe emotional distress. He could have put a psychological expert, or another qualified witness oh the stand to prove that he met the elements for intentional infliction of emotional distress, but he did not.


author: Justice ROBERT A. AMUND- SABERS, Justice AMUNDSON, Justice

text:
    2002 SD 113
    The PEOPLE of the State of South Dakota in the Interests of C.C.H., Minor Child, and Concerning N.C.H. and M.C.H.
    No. 22006.
    Supreme Court of South Dakota.
    Argued on Feb. 12, 2002.
    Decided Sept. 4, 2002.

      Mark Barnett, Attorney General, Richard M. Williams, Assistant Attorney General, Pierre, for appellee.
    Dana Hanna, Valentine, NE, for appellant C.C.H.
   Justice ROBERT A. AMUND-

[IT 1.] SON delivers the majority opinion of the Court on Issue 1, which reverses the trial court’s delinquency adjudication.

[¶ 2.] Acting Justice GORS delivers the majority on Issue 2, which reverses the trial court’s child in need of supervision adjudication.

[¶ 3.] C.C.H., a minor child, was adjudicated delinquent pursuant to SDCL Chapters 26-7A and 26-8C and a child in need of supervision as defined in SDCL Chapter 26-8B. C.C.H. appeals this disposition. We reverse.

FACTS

[¶ 4.] On February 13, 2001, in response to a teacher’s inquiry, C.C.H., an eighth grader in Winner, South Dakota, made threatening remarks regarding another student. Audrey Keierleber (Keier-leber), C.C.H’s Home Economics teacher, had noticed C.C.H. was behind on a class project, so she tried to assist him. C.C.H., however, refused to concentrate; rather, he stared across the classroom at B.C., another student. When Keierleber inquired into his actions, C.C.H. stated in a serious tone that he was angered by some of the students and that he wanted to kill B.C. Keierleber changed the subject and did not discuss C.C.H.’s comments with him. Later the same afternoon, Keierle-ber e-mailed middle school administrators the following message:

I am not sure what I should be doing. [C.C.H.] is in my 8th period FACS [home economics] class. When he is here he will not work for me. He wanted to [kill B.C.] and [S.] is irritating him. And the White Girls are looking at him. As a result he gets nothing done. I am open to suggestions. There is a potential explosion about to happen, and I want some way to deal with the problem ahead of time. Thanks for the help.
/s/ Audrey Keierleber

[¶ 5.] The following day, C.C.H. worked more productively in Keierleber’s class, but at the end of the period, again, responded to a second teacher inquiry that he wanted to kill B.C. In response, Keier-leber again wrote an e-mail to school administrators explaining that things went well, but that C.C.H. said he still wanted to kül B.C.

[¶ 6.] On February 15, 2001, school administration notified the Winner Police Department of C.C.H.’s statements to Keier-leber. C.C.H. was charged with simple assault and two counts of disorderly conduct. After a court trial, the simple assault charge and one count of disorderly conduct were dismissed. The trial court found C.C.H. guilty beyond a reasonable doubt on the remaining charge and entered an order of disposition.

[¶ 7.] The court entered a judgment finding C.C.H. to be a delinquent child as defined by SDCL 26-8C-2. The court further held that C.C.H. is a child in need of supervision (ChINS) as defined by SDCL 26-8B-2 even though the State did not submit a ChINS petition.

STANDARD OF REVIEW

[¶ 8.] Our standard of review for the disposition of a delinquency finding requires us to ensure that “the State proved each element of the offense beyond a reasonable doubt.” In Interest of A.W., 438 N.W.2d 557, 558 (S.D.1989). When reviewing the evidence, we will construe any inferences in favor of supporting the verdict. Id. See also In Interest of W.Y.B., 515 N.W.2d 453, 455-56 (S.D.1994). The State must prove the allegation made in a ChINS adjudication beyond a reasonable doubt, -and this Court applies the clearly erroneous standard on review of the trial court’s decision. In Matter of T.K., 462 N.W.2d 893, 895 (S.D.1990). “When an asserted error implicates an infringement of a constitutional right, we employ a de novo standard of review.” State v. Dillon, 2001 SD 97, ¶ 12, 632 N.W.2d 37, 43.

DECISION

[¶ 9.] AMUNDSON, Justice, delivers the majority on Issue 1, which reverses the trial court’s delinquency adjudication.

[¶ 10.] In addition to arguing that the elements of disorderly conduct have not been met, C.C.H. argues that his threats were -mere words of frustration that were communicated privately to Ms teacher. Therefore, he contends his words were not criminal in nature, and constitute protected speech under the First Amendment.

[¶ 11.] We have previously analyzed First Amendment rights to free speech and the types of speech exempted from constitutional protection. See, e.g., In the Interest of S.J.N-K., 2002 SD 70, 647 N.W.2d 707 (2002) (finding First Amendment protection did not apply to student’s vulgar language based on student’s threatening behavior); State v. Hauge, 1996 SD 48, 547 N.W.2d 173 (discussing over-breadth and restriction on speech by restraining order); Krueger v. Austad, 1996 SD 26, 545 N.W.2d 205 (discussing First Amendment in a libel action). We have not, however, had the opportunity to address the “true threats” doctrine.

[¶ 12.] The United States Supreme Court has clearly announced that a “true threat” is not protected by the First Amendment. Watts v. United States, 394 U.S. 705, 89 S.Ct. 1399, 22 L.Ed.2d 664 (1969). In Watts, the United States Supreme Court determined that an individual should not be prosecuted for statements he made about killing the President at a political rally. The comments made, the Court held, were not threats under the particular facts of the case, and true threats “must be distinguished from what is constitutionally protected speech.” Id. at 707, 394 U.S. 705, 89 S.Ct. at 1401, 22 L.Ed.2d 664.

[¶ 13.] In examining the true threats doctrine, it is obvious that courts have somewhat conflicting rulings regarding what constitutes a true threat. . Some courts have held students’ threatening words fall outside the realm of first amendment protection. See, e.g., Jones v. State, 347 Ark. 409, 64 S.W.3d 728 (2002) (holding a rap song from one classmate to another that described the killing of the recipient and her family constituted a true threat so that the First Amendment did not apply); In re A.S., 243 Wis.2d 173, 626 N.W.2d 712 (2001) (affirming adjudication of delinquency based on telling classmate a detailed plan of how he was going to kill and torture people at 'school). See also Svedberg v. Stamness, 525 N.W.2d 678 (N.D.1994) (finding a minor’s “incessant teasing” and “harassment” of another minor was not protected speech pursuant to the “fighting words” doctrine). Other courts, however, have held students’ threatening words fall within the realm of protected speech. In re Douglas D., 243 Wis.2d 204, 626 N.W.2d 725 (2001) (finding story written as a class assignment, which described the teacher’s head being cut off, is protected speech under the First Amendment); Doe ex rel. v. Pulaski Co. Special Sch. Dist., 263 F.3d 833 (8thCir.2001) (holding eighth grader’s composition discussing killing of classmate who broke up with him was protected speech under the First Amendment).

[¶ 14.] The Eighth Circuit has stated that the Supreme Court has not “established a bright-line test for distinguishing a true threat from protected speech.” Pulaski Co. Special Sch. Dist., 263 F.3d at 836. In Pulaski, the Eighth Circuit analysis of the true threat doctrine provides for consideration of the following factors:

Whether an objectively reasonable recipient would view the message as a threat; whether the threat was communicated directly to its victim; whether the maker of the threat had made similar statements to the victim in the past; whether the victim had reason to believe that the maker of the threat had a propensity to engage in violence; and whether the recipient of the alleged threat could reasonably conclude that it expresses “a determination or intent to hurt presently or in the future.”
“Alleged threats should be considered in light of their entire factual context, including the surrounding events and the reaction of the listeners.”

Id. (internal citations omitted). We adopt this analysis.

[¶ 15.] In applying this test, we first acknowledge that there are very few pages in the adjudicatory trial transcript that address these factors. Clearly, the evidence proves,that the threats were not communicated directly to the intended victims, but rather to a teacher who had inquired into C.C.H.’s demeanor. There is, however, very little evidence upon which to determine whether an objectively reasonable recipient would view the message as a threat.

[¶ 16.] Few pages in the trial transcript prove how Keierleber, the listener, reacted after hearing C.C.H.’s words. When asked what her reaction was when C.C.H. said he wanted to kill B.C., she said, it

“[k]ind of scared me. It was a very serious tone of voice. Very believable.” Despite Keierleber’s alleged fear, -she let C.C.H. and B.C. both leave her classroom at the end of class. She did e-mail her concerns to school administrators, but there is no indication in the trial record of why the administration did not act more quickly. Additionally, the only other .witness who testified about the threat 'was Paul Schueth, the police officer who questioned C.C.H. , about the incident. He merely stated that he had a short conversation with C.C.H., during which C.C.H. denied saying that he wanted to kill B.C.

[¶17.] We refuse to analyze C.C.H.’s usé of the word kill “in a vacuum[,]” and the surrounding untimely attentiveness by school administrators, lack of compelling testimony by Keierleber and lack of evidence regarding C.C.H.’s propensity to carry through with his threats leave us unconvinced that C.C.H.-should have been adjudicated a delinquent for the words he spoke. See S.J.N-K., 2002 SD 70 at ¶ 15, 647 N.W.2d at 712 (acknowledging the Court’s analysis of the circumstances surrounding the use of profane language). The evidence presented fails to prove that the solicited comments of C.C.H. constitute true threats. On this record, the only result that can be reached is that the words uttered by C.C.H. were not true threats; thus, we refrain from stripping C.C.H. of his right to free speech.

[¶ 18.] Hostility and competition among our youth- is natural. It happens in competitive sports; it happens in adolescent love affairs; it happens among siblings; it is an inevitable part of growing up. Many of the unkind words that stem from this hostility and competition may cause others uneasiness, but most of the words are protected by the First Amendment.

[I]n our system, undifferentiated fear or apprehension of disturbance is not enough to overcome the right to freedom of expression. Any departure from absolute regimentation may cause trouble. Any variation from the majority’s opinion may inspire fear. Any word spoken, in class, in the lunchroom, or on the campus, that deviates from the views' of another person may start an argument or cause a disturbance. But our Constitution says we must take this risk; and our history says that it is this sort of hazardous freedom — this kind of openness — that is the basis of our national strength and of the independence and vigor of Americans who grow up and live in this relatively permissive, often disputatious, society. .

Tinker v. Des Moines Indep. Cmty. Sch. Dist. 393 U.S. 503, 508, 89 S.Ct. 733, 737, 21 L.Ed.2d 731 (1969) (holding First Amendment protects. right to wear arm bands displaying disapproval of Vietnam War to school).

[¶ 19.] Therefore, we reverse the trial court’s delinquency adjudication.

[¶ 20.] GILBERTSON, Chief Justice, and KONENKAMP, Justice and GORS, Acting Justice, concur as to Issue 1.

[¶ 21.] SABERS, Justice, dissents as to Issue 1.

[¶ 22.] ZINTER, Justice, not having been a member of the Court at the time this action was submitted to the Court, did not participate.

SABERS, Justice

(dissenting).

[¶ 24.] I vote to affirm Issue 1 because there was sufficient evidence to adjudicate C.C.H. a delinquent under SDCL 22-13-1 because he “intentionally cause[d] serious public inconvenience, annoyance, or alarm to [another] person, or ereate[d] a risk thereof by: (1) engaging in ... threatening behavior [.] ” (emphasis added).

[¶.25.] GORS, Acting Justice, delivers the majority on Issue 2, which reverses the trial court’s finding that C.C.H. is a child in need of supervision.

[¶ 26.] C.C.H. cannot be adjudicated to be a Child in Need of Supervision. No ChINS petition was filed. Therefore, C.C.H. had no notice that he was being tried as a ChINS. C.C.H. could not defend against what he was not charged with, tried for, or alleged to be.

[¶ 27.] If C.C.H. were an adult, this would not be permitted. In State v. Tschetter, 337 N.W.2d 829, 830 (S.D.1983), this Court held that a trial court could not enter a. judgment of guilt for an offense other than that upon which the verdict was based. Here, the trial court entered an adjudication for another offense (ChINS status) that it thought also fit the facts. Although this Court upheld a ChINS adjudication when the evidence was insufficient to sustain a delinquency petition in In re T.K., 462 N.W.2d at 895, a trial court does not have the authority to fit a child’s conduct into an uncharged category, and then adjudicate and punish the child. It is a fundamental tenet of due process that when a person is charged with something, that person is entitled to notice of what the charge is and a hearing on the charge. City of Pierre v. Blackwell, 2001 SD 127, ¶ 13, 635 N.W.2d 581, 585 (“Under the Fourteenth Amendment to the United States Constitution, as well as Article VI, § 2 of the South Dakota Constitution, ‘no person shall be deprived of life, liberty, or property without due process of the law.’ Due process guarantees that notice and the right to be heard are granted in a ‘meaningful time and in a meaningful manner.’ Such guarantees are fundamental.”) (citations omitted). The only notice C.C.H. received of the charge was when he was adjudicated to be a ChINS. He had no hearing on the ChINS allegation. The ChINS adjudication was used as a catchall: C.C.H. must have done something wrong, so this must be it.

[¶ 28.] If the record is too limited to determine whether C.C.H.’s comments to the teacher were a “true threat” to support an adjudication for disorderly conduct, then the same insufficiency exists regarding the ChINS adjudication. A child in need of supervision is defined in SDCL 26-8B-2 as follows:

In this chapter and chapter 26-7A, the term, child in need of supervision, means:
(1) Any child of compulsory school age who is habitually absent from school without legal excuse;
(2) Any child who has run away from home or is otherwise beyond the control of the child’s parent, guardian, or custodian;
(3) Any child whose behavior or condition endangers the child’s own welfare or the welfare of others; or
(4)Any child who has violated any federal, state, or local law or regulation for which there is not a penalty of a criminal nature for an adult, except violations of § 34-46-2(2), or petty offenses.

C.C.H. is not a truant under subdivision (1) or beyond parental control under subdivision (2) or a status offender under subdivision (4). Subdivision (3) proscribing “behavior [which] endangers the child’s own welfare or the welfare of others” is the only provision that fits the trial court’s finding that “B.C.’s and other persons welfare was threatened.” The burden of proof is the same for ChINS and delinquents-beyond a reasonable doubt. SDCL 26-7A-K2) and 26-7A-86; In re T.K., 462 N.W.2d at 895; In re Interest of A.M., 438 N.W.2d at 558 (S.D.1989). If it has to be a “true threat” to be disorderly conduct, then it also has to be a “true threat” to endanger the welfare of other people because the same conduct and the same burden of proof is being considered for both adjudications.

[¶ 29.] One troubling aspect of this procedure is apparent. C.C.H. was held in pretrial detention for 66 days. A ChINS cannot be held in pretrial detention for more than 24 hours unless the child has violated a valid court order. SDCL 26-7A-14, 26-7A-15, 26-8B-3. Similarly, a ChINS cannot be placed in post-trial detention as a disposition, except under the very limited circumstances set forth in SDCL 26-8B-6(3) for violators of valid court orders, which is not applicable here.

[¶ 30.] Examining the evidence in the light most favorable to the State, the most that can be said of C.C.H. is that when his teacher asked him what was wrong, he told her: He made no threats and- created no disturbance. He took no steps to carry out his statement. It is not a ChINS offense to have bad thoughts. It is also not a ChINS offense to articulate bad thoughts, unless they are a “true threat.”

[¶ 31.] Therefore, we reverse the trial court’s ChINS adjudication.

[¶ 32.] SABERS and KONENKAMP, Justices, concur as to Issue 2.

[¶ 33.] GILBERTSON, Chief Justice and AMUNDSON, Justice, dissent as to Issue 2.

[¶ 34.] ZINTER, Justice, not having been a member of the Court at the time this action was .submitted to the Court, did not participate.

AMUNDSON, Justice

(dissenting).

[¶ 36.] C.C.H. argues for a reversal of the trial court’s decision that he is a child in need of supervision on the same grounds that he requested reversal of the delinquency adjudication. He also mentions that no ChINS petition was submitted to the court by the State.

[¶ 37.] In In re T.K., the State’s petition alleged a minor child was delinquent, but the order declared him to be a ChINS. The trial court said that it had done so because the State had not proven the underlying criminal charge of trespassing beyond a reasonable doubt. 462 N.W.2d at 894-95. We upheld the trial court’s decision because. “[t]he potential of violence existed. T.K’s and other persons’ welfare was threatened.” Id. at 895. Similarly, we should find the trial judge did not err by finding C.C.H. a ChINS. “It is well established that the purpose of any juvenile disposition is to serve the best interest of the child and the public.” Id. Here, we should find the trial court’s assessment of C.C.H. as a ChINS accurate and in C.C.H.’s best interest.

[¶ 38.] I would affirm the trial court’s decision on the ChINS adjudication.

[¶ 39.] GILBERTSON, Chief Justice, joins this dissent.

      . Under SDCL 22-13-1, disorderly conduct occurs when "[a]ny person who intentionally causes serious public inconvenience, annoy-anee, or alarm to any other person, or creates a risk thereof by: (1) Engaging in fighting or in violent or threatening behavior; ... ”

      . SDCL 26-8C-2 states that a delinquent child is defined as "any child ten years of age or older who ... violates any federal, state or local law or regulation for which there is a penalty of a criminal nature for an adult....”

      . A child in need of supervision is defined by SDCL 26-8B-2 as:
      (1) Any child of compulsory school age who is habitually absent from school without legal excuse;
      (2) Any child who has run away from home or is otherwise beyond the control of the child’s parent, guardian, or custodian;
      (3) Any child whose behavior or condition endangers the child's own welfare or the welfare of others; or
      (4) Any child who has violated any federal, state, or local law or regulation for which there is not a penalty of a criminal nature for an adult, except violations of § 34-46-2(2), or petty offenses.

      . C.C.H. contends that there was insufficient evidence to adjudicate him delinquent because he did not "intentionally” threaten B.C., and therefore the state failed to prove that element of the crime underlying his delinquency adjudication. SDCL- 22-13-1. C.C.H. also contends Keierleber’s response to the threats- was insufficient to prove the threats were a serious, public inconvenience. See SDCL 22-13-1(1) (requiring "serious public alarm” to prove disorderly conduct); State v. Rocky Mountain, 449 N.W.2d 257, 258 (S.D.1989) (explaining the "public” element of disorderly conduct).
      "Intent” under the disorderly conduct statute may be proven through circumstantial evidence and a, defendant's state of mind is “fairly deducible from the circumstances surrounding the offense.” State v. Holzer, 2000 SD 75, ¶ 14, 611 N.W.2d 647, 651. We have further said that "[bjecause the nature of intent is such that it is 'rarely susceptible to direct proof, the fact finder may determine intent by such reasonable inferences and deductions as may be drawn from facts proved by evidence in accordance with common experience and observation.’ " Id. at ¶ 16 (citation omitted). In this case, we find intent could certainly have been deduced from the evidence.
      Also,- the actions took place in a public school, which is clearly a public place. We have stated that "disorderly conduct may be directed at one person,” and that “it is clear from the statute that an essential element of disorderly conduct is the public nature of the offense.” Rocky Mountain, 449 N.W.2d at 258 (quoting Ellis v. Archer, 38 S.D. 285, 161 N.W. 192 (1917)). Thus, we need not address this issue further.

      . Jones v. State, 347 Ark. 409, 64 S.W.3d 728 (2002), analyzed Me various tests used by courts to assess whether a threat is true, and thus unprotected by the constitution. The First Circuit says the standard is “whether [the defendant] should have reasonably foreseen that the statement he uttered would be taken as a threat by those to whom it was made.” Id. at 735 (citation omitted). The Second Circuit asks if the language "on its face and in the circumstances in which it is made is so unequivocal, unconditional, immediate, and specific as to the person threatened, as to convey a gravity of purpose and imminent prospect of execution.” Id. at 734-35 (citation omitted.) The Sixth Circuit asks if a reasonable person would perceive "a serious expression of an intention to inflict bodily harm” and "the purpose of furthering some goal through the use of intimidation.” Id. at 735 (citation omitted). The Ninth Circuit asks, "[w]hether a reasonable person would foresee that the statement would be interpreted by those to whom the maker communicates the statement as a serious expression of intent to harm or assault.” Id. (citation omitted).

      ,. "Adjudication” in juvenile court is the functional equivalent of the "guilt or innoqence” phase in adult court. SDCL 26-7A-l (2).

      . The exception to the 24 hour limit to pretrial detention of a ChINS, for a child who has violated a valid court order, is not at issue here. SDCL 26-8B-3.

      . “Disposition” in juvenile court is the functional equivalent of sentencing in adult court. SDCL 26-7A-R17), 26-8B-6 and 26-8C-7. If C.C.H. had been tried as an adult, the maximum sentence would have been thirty days in jail and a $200 fine. SDCL 22-13-1 and 22-6-2(2).