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Present of Actual Property Partnership Was Marital Property When Gifted Throughout Marriage

Tennessee case abstract on property division, classification, and valuation in divorce.

Carolyn Diane Long v. Steven Lawrence Long

The spouse filed for divorce in Cumberland County, Tennessee, in 2014.  The trial courtroom divided the events’ property and there was a primary enchantment to the Tennessee Court docket of Appeals, which remanded the case to Decide Larry Michael Warner with directions to make adequate factual findings and conclusions to allow overview.  Particularly, the dispute concerned the classification of the spouse’s partnership curiosity in an entity often known as Pioneer Properties and its worth.

The husband and spouse have been initially married in 1984.  They have been divorced however remarried in 1987.  The spouse’s household had been concerned in actual property, and in 1993, her mom and stepfather created and funded the partnership.  The companions have been the spouse and her siblings.  The husband and spouse by no means contributed funds to the partnership.  When distributions have been paid out, the spouse deposited them right into a joint account.

In 1988, the events additionally acquired a property.  They have been considering divorce on the time, and the spouse meant to dwell there.  The husband quitclaimed his curiosity to the spouse, however they later reconciled and lived collectively on the home for a number of years.  They later moved and rented out that property.

Earlier than the primary enchantment, the trial courtroom awarded the spouse your complete curiosity within the partnership, which the spouse valued at over $300,000.  The trial courtroom, nonetheless, seen it as marital property.  The husband argued that it had a better worth, and to offset the worth, the courtroom awarded the husband different properties.

Within the first enchantment, the Court docket of Appeals famous that there’s a presumption that the partnership was marital, because it was acquired throughout the marriage.  This presumption, nonetheless, might be rebutted, with the spouse having the burden of proof.  The spouse had testified that the curiosity was a present, and meant to be separate.  The decrease courtroom, nonetheless, made no findings on this important challenge, ensuing within the remand.

After a listening to, each events ready an order, and the trial courtroom adopted the husband’s proposed order.  That order recited that each events had proferred proposed findings, which the courtroom had reviewed, and that the ultimate order mirrored the courtroom’s unbiased judgment.

The trial courtroom finally awarded the spouse’s curiosity solely to her, with the husband obtain different property solely.  The spouse then appealed to the Tennessee Court docket of Appeals.  She argued that the trial courtroom erred in adopting verbatim the husband’s findings of truth, with out making its personal unbiased judgment.  The appeals courtroom cited a 2014 case which makes clear that the “report should not create doubt that the choice represents the trial courtroom’s personal deliberations and determination.”

The appeals courtroom agreed with the spouse that the findings have been missing.  Specifically, it identified that the trial courtroom introduced its determination earlier than the proposed findings have been ready.  It additionally agreed that the difficulty was correctly earlier than the appeals courtroom.  Nonetheless, it additionally acknowledged that neither social gathering wished the case remanded, and it was finest to resolve the enchantment based mostly upon the report that was accessible.

The important thing challenge in deciding the destiny of the partnership was whether or not it had constituted a present to the spouse.  Right here, the courtroom zeroed in on the truth that distributions have been paid right into a joint account, indicating that at the very least the distributions, which totaled over $70,000 have been presents to the wedding, versus presents to only the spouse.  It discovered that this proof supported a conclusion that the partnership itself was a marital asset.  Particularly because the spouse had the burden of proof, the Court docket of Appeals affirmed the decrease courtroom’s ruling as to the standing of the partnership.

The appeals courtroom additionally reviewed the general distribution of the marital property and concluded that they have been equitable, regardless that not mathematically equal.

For these causes, the Court docket of Appeals affirmed the decrease courtroom’s judgment in its entirety.

The opinion of the Court docket of Appeals was penned by Decide Thomas R. Frierson, II, and Judges D. Michael Swiney and John W. McClarty joined.

No.E2020–01350-COA-R3-CV (Tenn. Ct. App. Sep. 27,  2021).

See unique opinion for precise language.  Authorized citations omitted.

To study extra, see Property Division in Tennessee Divorce and Transmutation in Tennessee Property Division Divorce Law.

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