Rogers v. Rogers ( 2020 )

THE STATE OF SOUTH CAROLINA
In The Court of Appeals
Laurie Rogers, Appellant,
v.
George Rogers and the Navy Federal Credit Union,
Of Whom George Rogers is Respondent.
Appellate Case No. 2017-002091
Appeal From Horry County
Jan Bromell Holmes, Family Court Judge
Opinion No. 5778
Heard July 21, 2020 – Filed October 21, 2020
AFFIRMED IN PART AS MODIFIED, REVERSED
IN PART, AND REMANDED
Nicole Nicolette Mace, The Law Offices of Curt
Sanchez, P.A., of West Palm Beach, Florida, for
Appellant.
Anita Floyd Lee, of Conway, for Respondent.
KONDUROS, J.: After a nineteen-year union, Laurie Rogers (Wife) filed for
divorce from George Rogers (Husband). The family court granted the divorce on
the grounds of one year's continuous separation, divided the marital estate 50/50,
and awarded custody of the parties' four children to Wife. Wife appeals various
aspects of the equitable apportionment and the imposition of discovery sanctions
against her. She contends the family court lacked jurisdiction because she was
incompetent and the family court failed to appoint her a guardian ad litem (GAL).
We affirm in part as modified, reverse in part, and remand.
FACTS/PROCEDURAL BACKGROUND
Husband and Wife separated on November 29, 2015, and Wife retained custody of
their children. On February 11, 2016, Wife filed an action for divorce on the
ground of adultery, wherein she also requested alimony, custody, and child
support. Husband filed an answer and counterclaim, agreeing the parties should
divorce but denying adultery.
A temporary hearing was initially scheduled for March 8, 2016, but was continued
until April 24, 2016. However, on March 11, 2016, the parties entered into a
consent order for discovery and on March 14, 2016, Ryan Stampfle was appointed
as GAL for the benefit of the parties' children. Wife's attorney was relieved as
counsel, and at the request of Wife's second lawyer, the hearing was rescheduled
for June 9, 2016. At that time, the family court issued an order which provided,
inter alia, that Husband would be responsible for child support in the amount of
$1,286 per month and Wife would have possession of the parties' home and would
be responsible for the monthly mortgage obligation incidental thereto.
Additionally, the court ordered that Wife present herself for a psychological
evaluation and that the children immediately begin counseling with their father to
address alienation concerns. The court also ordered a review hearing within sixty
days. The GAL was charged with the responsibility of scheduling Wife's
psychological evaluation as well as the counseling. Subsequent to this hearing,
Wife dismissed her second attorney.
On June 21, 2016, Husband filed a motion to compel discovery responses. At the
review hearing on August 26, 2016, Wife had still not appeared for the
psychological evaluation, and the children had yet to begin counseling. Husband
also scheduled his motion to compel discovery simultaneous with the review
hearing. At this August 26, 2016 hearing, the parties agreed the former marital
residence would be immediately placed on the market for sale; the children would
immediately begin counseling with Hal Heidt; Wife would immediately present
herself for a psychological evaluation with Douglas Ritz; and Wife would respond
to discovery within ten days.
Because of the lack of progress between the hearings on June 9 and August 26, the
family court ordered another hearing to be scheduled in October 2016.
Unfortunately, that hearing was continued until December 8, 2016, due to
inclement weather. Prior to the commencement of the December 8, 2016 hearing,
Wife's counsel presented a doctor's excuse on behalf of Wife. She advised the
court Wife was unable to attend the hearing and sought a continuance. Husband's
counsel then informed the court she had also scheduled a motion to compel for the
second time, as well as a rule to show cause for this date, though Wife had evaded
service of process of the rule (the hearing date for the motion was served directly
on Wife's counsel). The family court denied Wife's request for a continuance,
concluding instead that Wife did not need to be present for the review hearing.
The court then requested a progress report, after which the family court noted Wife
had not completed her psychological evaluation, had thwarted counseling efforts,
had withdrawn large amounts of cash from the parties' bank account, and had
transferred a large sum of money to a new location.
The court also determined Wife had severely damaged the parties' home by
removing and selling light fixtures, cabinets from walls, a toilet, and a majority of
furnishings from the home. As a result of this hearing, the court ordered custody
be immediately transferred to Husband, Wife pay the outstanding utility bills, and
Wife immediately vacate the property. In addition, Wife was ordered to respond to
all discovery requests by January 3, 2017. On about February 23, 2017, Wife's
third lawyer was relieved as counsel. Husband returned the children to Wife after
only one day and did not pay child support from that time forward. However,
Husband assumed the mortgage obligation from the time of the December hearing
until the time the home was sold. Husband testified he only returned the children
because Wife had alienated the children to such an extent that Husband had
absolutely no control of them, and actually feared them based upon their
fabrications to the police.1
Mediation was thereafter scheduled for March 3, 2017, but Wife did not attend,
claiming she had not received notice. Husband requested a final hearing, which
was scheduled for May 18, 2017. On the date of trial, Wife appeared with her
fourth lawyer, who moved for a continuance, claiming Wife had not been properly
notified of mediation or the final hearing. The court determined Wife had been
properly notified of mediation and that she had elected not to appear. The court
1
One of the children ran away and when picked up by police indicated she would
rather go to foster care than live with her father. She kicked a police officer and
eventually went to the Department of Juvenile Justice for a short time. Another
child told police Husband had hit him and the other children supported this story
although police discerned from the child's appearance the story was implausible.
acknowledged notice of the final hearing had been served on the parties' daughter,
so out of an abundance of caution, the trial was continued until July 10, 2017.
A hearing on Husband's motion to compel discovery and show cause was held on
June 5, 2017. At the time of the June 5, 2017 hearing, Husband had received from
Wife only copies of what he had presented at previous hearings. Accordingly, the
court ruled that unless Wife complied with discovery requests by June 16, 2017,
she would not be allowed to testify on the issues of alimony, child support,
equitable apportionment, or attorney's fees, and she would not be allowed to offer
any evidence regarding her income, alimony, or equitable apportionment. As of
June 16, 2017, Wife had still not provided the requested bank statements; she had
still not verified her income as had been requested; and she had still not produced
full tax returns.
At the final hearing, the family court was notified Wife had moved marital funds
into at least four separate accounts at the Navy Federal Credit Union (NFCU), said
accounts all being in Wife's name, though each account also bore an additional
name, one for each of the parties' four children. The NFCU accounts were opened
with funds transferred from another account Husband discovered during the
pendency of the action containing more than $200,000.
After Wife disclosed more specific information about the NFCU accounts, the
court recessed the final hearing until the following morning, July 11, 2017. The
family court ordered Wife to provide to Husband's counsel the names, account
numbers, phone numbers, and any other pertinent information relative to these
accounts. The family court further issued an order restraining Wife from
transferring the funds, from dissipating the accounts, or from accessing these funds
in any manner pending the issuance of a Final Order. Wife was also ordered to
obtain a verified social security statement indicating how much she received from
social security each month.
The following morning, Wife's counsel advised the court Wife had been
hospitalized, and she requested a continuance. Husband then informed the court
that after the previous day's hearing, Wife had driven to Charleston and attempted
to withdraw the funds from the NFCU. However, NFCU had placed a temporary
hold on the accounts, and Wife was denied access to the funds. After Wife
returned from Charleston, she drove herself to the emergency room at Grand
Strand Regional Medical Center.
Wife's request for a continuance was denied, and the court noted that even if Wife
had been present, her ability to testify or present any evidence in regards to any of
the contested issues would have been severely limited, based upon her refusal to
comply with discovery after several orders to compel had been issued. This was
based not only on the order following the June 5, 2016 hearing, but also the court's
warning from the prior day of the final hearing wherein the court was still
considering the severity of limitations it would place on Wife's testimony. The
GAL was excused from attendance to locate Wife and after he returned to court, he
noted Wife had been in the emergency room at Grand Strand Regional Medical
Center and that when he saw her, she was in the process of being discharged.
However, she had never actually been admitted to the hospital. The GAL noted
that he was able to have a "lucid, normal conversation [with Wife] just like every
other conversation I had with her."
At trial, Husband testified as to various issues including custody, child support,
asset valuation, and equitable division. Husband presented a realtor, Glenn
Hellofs, who testified as to the valuation of the marital home, the GAL who
testified as to custody, and a friend of Husband who testified as to the parties
having lived separate and apart for one year. Following trial, the family court
issued an order granting a divorce on the grounds of one year's continuous
separation, awarding Wife custody of the children, dividing the marital estate
50/50, denying alimony, and awarding child support in a lump sum in the form of
an offset against Husband's equitable distribution interest. Thereafter, Wife filed a
motion to alter or amend the final judgement. The court issued an order denying
Wife's motion, though it did correct some clerical errors and reference additional
evidence presented at trial to support its initial ruling. The amended Final Order
was filed September 29, 2017. This appeal followed.
STANDARD OF REVIEW
[W]hile retaining the authority to make our own findings
of fact, we recognize the superior position of the family
court judge in making credibility determinations.
Moreover, consistent with our constitutional authority
for de novo review, an appellant is not relieved of his
burden to demonstrate error in the family court's findings
of fact. Consequently, the family court's factual findings
will be affirmed unless "appellant satisfies this court that
the preponderance of the evidence is against the finding
of the [family] court."
Lewis v. Lewis, 392 S.C. 381, 392, 709 S.E.2d 650, 655 (2011) (footnote omitted)
(quoting Finley v. Cartwright, 55 S.C. 198, 202, 33 S.E. 359, 360-61 (1899)).
"Lewis did not address the standard for reviewing a family court's evidentiary or
procedural rulings, which we review using an abuse of discretion standard."
Stoney v. Stoney, 422 S.C. 593, 594 n.2, 813 S.E.2d 486, 486 n.2 (2018) (per
curiam).
LAW/ANALYSIS
I. Mental Incompetence, Discovery Sanction and Continuance
A. Mental Incompetence/Subject Matter Jurisdiction
On appeal, Wife argues the family court lacked subject matter jurisdiction over the
parties' case because she was mentally incompetent and the family court did not
appoint a GAL to represent her interests.2 We disagree.
"Mental incompetency 'in its ordinary meaning imports mental deficiency so great
as to render one unable to comprehend or transact the ordinary affairs of life.'"
Thompson v. Moore, 227 S.C. 417, 422, 88 S.E.2d 354, 356 (1955) (quoting Edge
v. Dunean Mills, 202 S.C. 189, 195, 24 S.E.2d 268, 271 (1943)). In Zaragoza v.
Zaragoza, 309 S.C. 149, 151-52, 420 S.E.2d 516, 517-18 (Ct. App. 1992), the
family court considered the wife's argument that her husband was incompetent.
The husband had suffered a brain injury while in the armed forces and was
receiving disability. Id. at 150, 420 S.E.2d at 516. He had lapses in memory and
required assistance in managing some of his affairs. Id. However, he lived and
traveled independently with some minor assistance from his mother. Id. The
family court determined it would not equate the husband's disability with
incompetence, and this court affirmed. Id. at 152-53, 420 S.E.2d at 518.
In the present case, Wife demonstrated unwise and sometimes illogical behavior.
However, her conduct was generally directed at prolonging and complicating the
divorce proceedings and attempting to maintain marital assets for her own benefit.
Although the family court ordered a psychological examination for Wife, that
examination was based on the GAL's recommendation and was likely geared
2
"The court shall appoint a guardian ad litem for a minor or incompetent person
not otherwise represented in an action or shall make such order as it deems proper
for the protection of the minor or incompetent person." Rule 17(c), SCRCP.
toward determining parental fitness more so than the larger question of
competence. Additionally, it appears Wife eventually completed a partial
psychological evaluation. However, information about that process is not included
in the record. At trial, Husband was asked if he was aware of Wife's traumatic
brain injury, to which he responded "that is what she says." The only evidence in
the record regarding Wife's physical, mental, or emotional state was Husband's
testimony that Wife had "issues" and goes to the Department of Veteran's Affairs
for medications. Whatever Wife's issues, they do not appear to have rendered her
unable to communicate with her attorneys, the family court, or the children's GAL
or to understand the family court's instructions. In fact, Wife understood the nature
of the proceedings so well that she surreptitiously manipulated the parties' assets,
not to mention the children's attitudes toward Husband, in a clear attempt to gain
an advantage whenever the family court issued an order that preserved the status
quo. This included selling fixtures from the marital home, charging legal fees to
credit cards in Husband's name, withdrawing and carefully hiding funds from the
marital joint checking account, and secreting funds in the NFCU accounts.3
Notably, in spite of her lack of cooperation in the divorce case, neither Wife, nor
her numerous counsels of record, put forward Wife's competence as an issue.4
Based on all of the foregoing, we find the family court did not err in failing to
appoint Wife a GAL.
B. Discovery Sanctions
Next, Wife contends the family court erred in imposing discovery sanctions that
prevented her from offering evidence as to the issues of alimony, child support,
and equitable division. We disagree.
3
The record suggests Wife ably familiarized herself with the federal government's
requirement that banks report withdrawals of $10,000 or more as she withdrew
funds from disputed accounts, discussed later in this opinion, in increments of
$9,999. See 31 U.S.C. § 5316(a) (2018); 31 C.F.R. § 1010.311 (2019).
4
Husband contends Wife's competency argument is unpreserved as it was not
raised to the family court until Wife's motion for reconsideration. Wife
denominates the issue as one of subject matter jurisdiction which would negate
Husband's contention. We are not convinced Wife's position is correct as "[t]he
family court has exclusive jurisdiction . . . to hear and determine actions for
divorce a vinculo matrimonii . . . ." S.C. Code Ann. § 63-3-530(A)(2) (2010).
Regardless, as seen from the discussion supra, we conclude the family court did
not err as to this issue.
"If a party fails to obey an order to provide or permit discovery, the trial court may
impose sanctions such as striking pleadings, dismissing the action, or rendering a
default judgment." Griffin Grading & Clearing, Inc. v. Tire Serv. Equip. Mfg. Co.,
334 S.C. 193, 198, 511 S.E.2d 716, 718 (Ct. App. 1999) (citing Rule 37(b)(2)(C),
SCRCP)). "When the court orders default or dismissal, or the sanction itself results
in default or dismissal, the end result is harsh medicine that should not be
administered lightly." Id. "Therefore, the sanction should be aimed at the specific
conduct of the party sanctioned and not go beyond the necessities of the situation
to foreclose a decision on the merits of a case." Id. at 198, 511 S.E.2d at 719.
"Where the sanction would be tantamount to granting a judgment by default, the
moving party must show bad faith, willful disobedience or gross indifference to its
rights to justify the sanction." Id. at 198-99, 511 S.E.2d at 719.
Numerous discovery violations were delineated in the family court's order and the
record demonstrates Wife's noncompliance was willful. Wife was forewarned in
an order from the June 5, 2017 hearing that this sanction would be issued if she
continued refusing to produce discovery or comply with orders of the court by June
16, 2017. In spite of this order, the family court left open the question of the
parameters of Wife's testimony at the conclusion of the first day of the final
hearing and instructed Wife to bring her discovery information to court the
following day. Wife did not avail herself of the family court's offer, but instead
failed to attend the second day of the hearing.
In the absence of Wife's discovery, the family court conducted in-court inquiries in
an attempt to verify Wife's disability benefits. Husband presented evidence of the
values of other assets and testified as to his estimate of the value of other items.
Husband presented a realtor who testified to the value of the marital home both
before and after Wife's damage to the home. Unquestionably, Wife was prejudiced
by the discovery sanctions. However, Wife was forewarned of the sanctions and
continued to disregard the family court's instructions. Consequently, we are not
persuaded the family court erred as to this issue.
C. Continuance
Next, Wife maintains the family court erred in denying her request for a
continuance on the second day of the final hearing because she was at the hospital
in the emergency room. We disagree.
Rule 40(i)(1) of the South Carolina Rules of Civil Procedure provides "[i]f good
and sufficient cause for continuance is shown, the continuance may be granted by
the court." The family court determined Wife's trip to the hospital was a ruse
designed to delay the proceedings and as Wife would not be permitted to present
evidence due to the discovery sanctions, the proceedings could continue in her
absence. Wife was represented by counsel the second day of trial, and the family
court sent the children's GAL to the hospital to attempt to ascertain Wife's status
and wishes with regard to the custody of the children. The GAL indicated Wife
was notably under stress but was capable of communicating clearly and logically
with him. Based on all of the foregoing, we conclude the family court did not err
refusing to grant Wife a continuance on the second day of trial.
II. Lump Sum Child Support Credit Against Equitable Distribution
Wife contends the family court erred in awarding her a lump sum for child support
for the parties' four children. She also contends the court erred in executing that
award through a setoff against Husband's equitable portion of the marital estate.
We agree.
The family court awarded Wife child support in the amount of $64,640. This
represented the total child support amount for each of the parties' four children for
the duration of each child's minority. The amounts were based upon the child
support guidelines as calculated by Husband. Husband also included an additional
$10,000 "cost of living" in reaching the final lump sum. The family court
determined this award would be unmodifiable and would be awarded as an offset
against Wife's portion of the marital estate. These decisions were driven by
Husband's wishes to avoid future litigation and entanglement with Wife.
The issue of lump sum child support has not been directly addressed in South
Carolina. Other jurisdictions have different positions on the subject. In North
Carolina, lump sum child support is specifically allowed pursuant to statute. See
N.C. Gen. Stat. § 50-13.4(e) (West, Westlaw through S.L. 2020-74) ("Payment for
the support of a minor child shall be paid by lump sum payment, periodic
payments, or by transfer of title or possession of personal property of any interest
therein, or a security interest in or possession of real property, as the court may
order."). Georgia courts have concluded that although lump sum child support is
not specifically allowed pursuant to statute, it is not precluded. In Mullin v. Roy,
the court stated:
Nothing in OCGA § 19-6-15 expressly precludes lump-
sum child support awards. To the contrary, the statute as
amended explicitly authorizes trial courts to exercise
discretion in setting the manner and timing of payment.
See OCGA § 19-6-15(c)(2)(B) (requiring trial courts to
"[s]pecify . . . in what manner, how often, to whom, and
until when the support shall be paid"). This language is
certainly broad enough to encompass an order to pay
a child support obligation all at once.
700 S.E.2d 370, 372 (Ga. 2010) (alteration and omission in original).
Conversely, Florida and Mississippi have specifically disallowed lump sum
support. "Mississippi law is clear that 'that child support should never be awarded
in lump sum.'" McCall v. McCall, 2019 WL 350628 at *3 (Miss. Ct. App. Jan. 29,
2019) (quoting Pittman v. Pittman, 909 So. 2d 148, 153 (Miss. Ct. App. 2005)). In
analyzing the issue in Florida, the district court of appeals explained:
First, we reverse the trial court's lump sum child support
award to the former wife, because no statutory or
precedential authority allows for such a lump sum child
support award. If the Florida Legislature intended to
permit a lump sum child support award, then perhaps the
Legislature would have included such a provision within
the child support provisions of section 61.30, Florida
Statutes (2016), as it did within the alimony provisions
of section 61.08(1), Florida Statutes (2016). . . . [I]nstead
of a lump sum child support award, the trial court may
consider sequestering the former husband's assets to
provide security for the child support award.
Masnev v. Masnev, 253 So. 3d 638, 639 (Fla. Dist. Ct. App. 2018).
Like Florida, South Carolina makes no specific provision for lump sum child
support awards although it does so for alimony. See S.C. Code Ann. § 20-3-
130(B)(2) (2014) (explaining the nature and purpose of lump sum alimony).
In Mitchell v. Mitchell, 283 S.C. 87, 92-93, 320 S.E.2d 706, 710 (1984), the court
affirmed a $400 per month child support award. The wife was to retain, in an
interest-bearing account, the husband's one-half of the proceeds from the sale of
the marital home, with her having the right to withdraw monthly $400 in interest
and principal to satisfy the husband's support payment. Id. at 89, 320 S.E.2d at
708. This arrangement still provided for periodic child support but sequestered the
funds to provide security for the child.5 Securing an award is permissible under
certain circumstances. See S.C. Code Ann. § 20-3-160 (2014) ("In any action for
divorce from the bonds of matrimony the court may at any stage of the cause, or
from time to time after final judgment, make such orders touching the care,
custody[,] and maintenance of the children of the marriage and what, if any,
security shall be given for the same as from the circumstances of the parties and
the nature of the case and the best spiritual as well as other interests of the children
may be fit, equitable[,] and just.").
After considering the relevant law and the facts of this case, we conclude the
family court's lump sum child support award must be reversed as there is no
statutory or precedential authority in South Carolina for a lump sum award.
Although the court may create a trust or require other security to protect child
support payments, such device is generally used to ensure the asset will not be
dwindled away by the supporting parent. In this case, the lump sum was not
placed in any secure asset for benefit of the children but was simply credited
against Husband's equitable share at his request to diminish the possibility of future
conflict with Wife. We agree with the family court that Wife's behavior warrants
making certain arrangements to minimize her ability to file litigation simply for the
sake of harassing Husband. However, the lump sum award is not an appropriate
vehicle for accomplishing this goal. Furthermore, the child support award in this
case was deemed unmodifiable. This is contrary to the instruction in section 20-3-
160 providing the family court retains authority to modify orders touching the
maintenance and security of children even after final judgment.
Although we are reluctant to remand a case in which the parties have obviously
suffered such a fractured relationship, we must. Unwinding the matter of the lump
sum child support and offset will be complex. On remand, the family court should
effectuate a 50/50 division of the marital estate in keeping with the other
modifications in this opinion and bearing in mind that any offset to Wife for child
support is eliminated. Furthermore, the family court should calculate any unpaid
child support Husband owes to Wife. Because the child support award was
heretofore unmodifiable, the family court should take testimony and evidence from
the parties as to any substantial or material change in circumstances that have
occurred since the final hearing.6 Normally, a party would be required to file and
5
The wife did not appeal the manner in which the award was to be administered,
just the monthly amount of the award.
6
We affirm the family court's original calculation of $1,070 as the amount of
monthly child support as it was based on the information provided at trial and the
prove a change in circumstances; however, the complexity of setting support and
correcting the offset from the award of equitable division may require a full
evaluation of the parties' and their children's present circumstances. The family
court should use this information to determine any accrued child support and the
amount of Husband's support obligation going forward. Any accrued child support
payments should be paid to Wife as the family court deems appropriate for
Husband's circumstances.
III. Equitable Distribution
A. Marital Residence
Next, Wife argues the family court erred in valuing the marital residence at its
prelitigation value and in awarding Wife the home as part of the equitable division.
We disagree.
The family court valued the martial residence at $265,000 based on the testimony
of realtor Glenn Hellofs. This was his estimate of the value of the house prior to
Wife's selling many of the fixtures in the home, damaging it, and otherwise failing
to care for it.7 After her misconduct, the precise date of which is uncertain, Hellofs
valued the marital residence at $185,000. $110,000 was owed on the home's
mortgage. The family court awarded Wife the devalued asset to hold Wife
accountable for her destructive behavior. This distribution put Wife in the position
of absorbing the entire cost of the devaluation in the home—$80,000. While this is
a harsh penalty to Wife, we are not persuaded the family court erred in its decision.
In Dixon v. Dixon, the husband had intentionally devalued his business after the
filing of litigation to the point of bankruptcy. 334 S.C. 222, 228-35, 512 S.E.2d
539, 542-44 (Ct. App. 1999) (per curiam). The family court awarded the husband
the business in the parties' equitable division and assigned the business, C&R, its
prelitigation value. Id. at 233-35, 512 S.E.2d at 545. In affirming this decision,
the court of appeals explained:
child support guidelines. Changes may include the emancipation of any of the
children or other substantial changes in Husband's or Wife's financial
circumstances.
7
The GAL's report suggest the damage to the home may not be as significant as
described by Husband and Hellofs. However, the GAL acknowledges the parties'
home would require some fairly substantial renovations to sell for what it is
potentially worth.
Had C & R been in existence at the time of the final
hearing, it likely would have been awarded solely to the
Husband, given his importance to the business and the
Wife's minimal involvement in the day-to-day
operations. Other marital assets would have been
awarded to the Wife to bring the equitable division in
line with the percentage allocation of the estate as
determined by the family court. In this case, however, to
assess the entire value of C & R against the Husband's
share of the marital estate will have severe consequences.
The value we have assigned to C & R, although an
accurate determination of its value at the time of the
commencement of this action, is nonetheless an artificial
value in one sense, given that C & R in fact no longer
exists. Thus, every dollar of C & R's value that we
assign to the Husband amounts to a dollar reduction in
his realized share of the marital estate. Because C & R is
the single largest asset in the marital estate, the
Husband's share of the marital estate will be reduced
dramatically.
However, were we to assess any portion of C & R's value
against the Wife's share of the marital estate, we would
be reducing her realized share of the marital estate.
Thus, to assess any portion of the C & R's value against
the Wife would reward the Husband for his economic
misconduct and punish the Wife, who was completely
without responsibility for the demise of C & R.
Accordingly, we conclude that the only equitable way to
allocate the value of C & R is to assess its entire value
against the Husband's share of the marital estate.
Id. at 233-34, 512 S.E.2d at 545.
We note, this case is distinguishable from Dixon in some respects. In this case,
Wife alleged adultery although it was not proven. In Dixon, the husband, the party
who devalued the asset, was found to have committed adultery. Id. at 226, 512
S.E.2d at 541. Additionally, the parties had no dependent children in the Dixon
case. Id. at 225, 512 S.E.2d at 540. In this case, Wife was responsible for the care
of the parties' four children.8 Nevertheless, Wife's economic misconduct was the
cause of the devaluation. This is a difficult issue, but overall we are not persuaded
the family court erred in awarding Wife the marital home at its prelitigation value.
B. Credit Card Debt
Wife argues the family court erred in holding her solely responsible for the
$14,843 credit card debt accumulated post-separation. We agree in part.
The equitable division statute9
creates a rebuttable presumption that a debt of either
spouse incurred prior to the beginning of marital
litigation is a marital debt and must be factored in the
totality of equitable apportionment. When the debt is
incurred before marital litigation begins, the burden of
proving a debt is nonmarital rests upon the party who
makes such an assertion.
Wooten v. Wooten, 364 S.C. 532, 546-47, 615 S.E.2d 98, 105 (2005) (citations
omitted).
Husband maintained Wife made the charges at issue without his knowledge. This
appears to be the sole basis for the family court's decision according to the final
amended order. However, this does not in and of itself mean the charges did not
benefit the marriage as Wife was maintaining the home and providing all the
support for the children during this time period. See Thomas v. Thomas, 346 S.C.
20, 27, 550 S.E.2d 580, 584 (Ct. App. 2001) ("Marital debt is debt incurred for
the joint benefit of the parties regardless of whether the parties are legally
jointly liable for the debt.") aff'd as modified, 353 S.C. 523, 579 S.E.2d 310 (2003).
Charges made post-separation but prelitigation would be presumed marital unless
Husband rebutted that presumption. Therefore, the family court erred in adopting
Husband's position wholesale, without closer scrutiny.
8
Husband never sought sole custody of the children but sought joint custody in the
form of visitation. As the record demonstrates, a shared custody arrangement was
derailed by Wife's efforts to alienate Husband and the children.
9
S.C. Code Ann. § 20-3-620 (2014).
Reviewing the credit card statements presented by Husband, we ascertain some
charges were not in support of the marriage. Wife incurred charges totaling $5,350
for legal services presumably related to the parties' separation. These charges were
obviously not in support of the marriage, household, or children. However, of the
$14,843 at issue, $6,045.25 of the charges were incurred prior to the
commencement of marital litigation for more generalized expenses that supported
the family and household. Therefore, that amount, $6,045.25, should be
considered marital debt and apportioned equally between Husband and Wife. The
remaining debt—$8,797.75, constituting legal fees and post-litigation charges—are
nonmarital debt and should be charged against Wife's portion of the equitable
division.
C. Marital Property Awarded to Husband—Joint Checking and
Savings Accounts and Honda Odyssey Van
Wife maintains the family court erred in valuing and awarding certain assets to her
as part of the equitable distribution. We agree in part.
The ownership prong can potentially raise troublesome
issues if the family court overlooks assets which should
rightly be included in the marital estate, but which are
non-existent on the date of filing due to a party's
misconduct. Consequently, if a party attempts to unfairly
extinguish ownership of marital property before
the date of filing . . . , the family court must include that
property in the marital estate. To do otherwise would
"promote fraud, reward misconduct, and contravene
legislative intent."
Shorb v. Shorb, 372 S.C. 623, 632, 643 S.E.2d 124, 129 (Ct. App. 2007) (citations
omitted) (quoting Bowman v. Bowman, 357 S.C. 146, 155, 591 S.E.2d 654, 659
(Ct. App. 2004)).
Husband and Wife maintained a joint savings account and a joint checking account
at Bank of America prior to their separation. As to those assets, Husband testified
as follows:
Q. Did you also have a joint savings account at Bank
of America?
A. Yes, ma'am.
Q. And that reflects the amount of $49,674, also on
November 30, 2015.
A. Yes, ma'am.
Q. Is that correct?
A. Yes, ma'am.
Q. And did you make any withdrawals from that
savings account?
A. Yes, ma'am, I took $20,500.
Q. Thereby leaving in the checking account $37,797,
and $29,174; is that correct?
A. Yes, ma'am.
Q. And what happened the next day?
Husband testified Wife knew Husband was going to take funds from the savings
account, so she attempted, albeit too late, to electronically withdraw all the funds
from the savings account and checking account and thereby created an overdraft.
However, when faced with the overdraft, Wife returned the $20,500 to the savings
account. Keeping the funds she had remaining from both savings and checking,
Wife opened a new account and then withdrew funds from that account in
increments of $9,999 or less until the account was emptied by the date litigation
was filed. According to Wife's testimony, she and the children lived off these
funds and she had approximately $9,000 remaining at the time of trial. Wife
testified Husband "took $20,700 of December 1, 2015. I called him because I went
to pay the bills thinking this was a temporary separation. I said where did the
$20,000 go? He said I took that for a nest egg for myself, the rest is yours and the
kids'. It's yours."
Based on the testimony from both parties, the family court erred in valuing the
joint savings account as of the date of separation instead of the date of filing. The
parties had divided the account by agreement and taken individual ownership of
their part prior to the filing of marital litigation. Wife did not unfairly attempt to
extinguish ownership of the joint savings account so there is no basis for valuing
the asset at a time other than the time litigation was commenced. See Taylor-
Cracraft v. Cracraft, 417 S.C. 570, 581, 790 S.E.2d 423, 429 (Ct. App. 2016)
("Marital property subject to equitable distribution is presumptively valued at the
date of the divorce filing."). At that time, the joint savings account had a value of
zero.
With regard to the joint checking account, Husband's marital asset addendum also
reflects the date of separation, not filing, for valuation. The record reflects Wife
withdrew the entire amount of the checking account post-separation and prefiling
with no agreement from Husband. Then, she moved the funds into other accounts
in amounts less than $10,000. Because she attempted to extinguish the account
prefiling, the family court did not err in valuing the checking account at the time of
the separation and awarding its value against Wife's share of the marital estate.
Finally, Wife also contends the family court erred in its valuing a Honda Odyssey
Wife purchased approximately two months before the parties separated at $40,000.
We disagree.
Husband testified Wife told him she paid $40,000 for the van. He listed the asset
on his marital asset addendum with a $40,000 equity value. Although Wife could
not offer any evidence about the van, she did not cross-examine Husband about his
testimony. The only other evidence in the record relating to the van is Husband's
Exhibit 2, a joint savings account statement, which indicates $20,000 was
withdrawn on October 5, 2016. A hand-written notation indicates the withdrawal
was made for "purchase of van by Wife." The dearth of evidence as to the equity
in the van is regrettable. However, based on the record, we cannot say the family
court's valuation is against the preponderance of the evidence.
IV. Alimony
Wife argues the family court erred in denying her request for alimony. We
disagree.
"Generally, alimony should place the supported spouse, as nearly as is practical, in
the same position he or she enjoyed during the marriage." Allen v. Allen, 347 S.C.
177, 184, 554 S.E.2d 421, 424 (Ct. App. 2001). "It is the duty of the family court
to make an alimony award that is fit, equitable, and just if the claim is well
founded." Id.
Factors to be considered in making an alimony award
include: (1) duration of the marriage; (2) physical and
emotional health of the parties; (3) educational
background of the parties; (4) employment history and
earning potential of the parties; (5) standard of living
established during the marriage; (6) current and
reasonably anticipated earnings of the parties; (7)
current and reasonably anticipated expenses of the
parties; (8) marital and nonmarital properties of the
parties; (9) custody of children; (10) marital misconduct
or fault; (11) tax consequences; and (12) prior support
obligations; as well as (13) other factors the
court considers relevant.
Id. (citing S.C. Code Ann. § 20-3-130(C) (Supp. 2000)). "No one factor is
dispositive." Id. at 184, 554 S.E.2d at 425.
"Generally, if on appeal there is inadequate evidentiary support for each of the
factors, the appellate court should reverse and remand so the trial court may make
specific findings of fact." Griffith v. Griffith, 332 S.C. 630, 646, 506 S.E.2d 526,
535 (Ct. App. 1998). "However, when an order from the family court is issued in
violation of Rule 26(a), SCRFC, the appellate court 'may remand the matter to the
trial court or, where the record is sufficient, make its own findings of fact in
accordance with the preponderance of the evidence.'" Id. at 646-47, 506 S.E.2d at
535 (quoting Holcombe v. Hardee, 304 S.C. 522, 524, 405 S.E.2d 821, 822
(1991)).
In this case, the family court did not address each of the factors specifically in
declining to award alimony to Wife. The family court noted Wife received
disability and social security benefits totaling $4,625 per month. Wife's emotional
health, educational background, or earning potential do not impact the monthly
amount of her income as her income is derived from sources independent of her
current employability. Wife would have had more expenses than Husband based
on the fact that she retained custody of the four children; however, she was
prevented from admitting evidence as to precisely those expenses at trial because
of her discovery violations.10 Additionally, Wife will begin receiving monthly
payments to contribute toward additional expenses she incurs on behalf of the
children once the child support order is modified. Furthermore, the record reflects
one reason Wife was solely responsible for the children was because she alienated
them from Husband. The family court also emphasized that Wife possessed
significant non-martial property—a $350,000 inheritance.
Wife repeatedly failed to exercise her right to participate fully in her own case.
Had she done so, she may have proven a case for alimony. We are not persuaded
10
Wife presented a financial declaration in June of 2016 that the family court may
have considered, but if so, it is not referenced in the family court's order. In any
event, the family court found Wife inherently uncredible.
the family court's decision was against the preponderance of the evidence
presented. Therefore, the family court's ruling on alimony is affirmed.
V. Attorney's Fees and Guardian Ad Litem Fees
Finally, Wife argues the family court erred in awarding Husband attorney's fees
and in requiring her to pay the outstanding GAL fees. We agree in part.
"In determining whether an attorney's fee should be awarded, the following factors
should be considered: (1) the party's ability to pay his/her own attorney's fee; (2)
beneficial results obtained by the attorney; (3) the parties' respective financial
conditions; (4) effect of the attorney's fee on each party's standard of living."
E.D.M. v. T.A.M., 307 S.C. 471, 476-77, 415 S.E.2d 812, 816 (1992).
The family court awarded Husband $20,000 of the $33,872.12 he accrued in
attorney's fees based largely on Wife's misconduct during the course of the
litigation. Misconduct or uncooperativeness can be a factor in awarding attorney's
fees. See Spreeuw v. Barker, 385 S.C. 45, 73, 682 S.E.2d 843, 857 (Ct. App. 2009)
("Taking into account that [the f]ather's uncooperative conduct greatly increased
the cost of litigation, we affirm the family court's award of $43,675
in attorney's fees to [the m]other."); see also Donahue v. Donahue, 299 S.C. 353,
365, 384 S.E.2d 741, 748 (1989) (holding husband's lack of cooperation serves as
an additional basis for the award of attorney's fees); Anderson v. Tolbert, 322 S.C.
543, 549-50, 473 S.E.2d 456, 459 (Ct. App. 1996) (per curiam) (noting
an uncooperative party who does much to prolong and hamper a final resolution of
the issues in a domestic case should not be rewarded for such conduct).
The court noted the incomes of both parties, found Husband obtained beneficial
results in the litigation, and concluded Wife would be able to pay this amount
without diminishing her standard of living based in part on her inheritance. The
record demonstrates Wife made the litigation more difficult and expensive and
although the record is not fully developed as to the financial conditions of both
parties, we are not persuaded the family court erred in awarding Husband $20,000
in attorney's fees as the record demonstrates Wife has a large inheritance that
places her in a stronger financial position. However, the beneficial results analysis
changes slightly in light of some of the modifications in this opinion. Therefore,
we remand the award of attorney's fees for reconsideration based on this factor.
Additionally, the parties had accrued $11,705 in GAL fees in the case. At the time
of trial, Husband had paid $4,625 of the fees. After reiterating the difficulty Wife
created in the case, particularly Wife's trip to the emergency room the second day
of trial, the family court ordered Wife to pay the outstanding $5,518.75. The
family court did not address any factors outside Wife's misconduct in making this
award. However, the record is sufficient to allow affirmance. See Griffith, 332
S.C. at 646-47, 506 S.E.2d at 535 ("[W]hen an order from the family court is
issued in violation of Rule 26(a), SCRFC, the appellate court 'may remand the
matter to the trial court or, where the record is sufficient, make its own findings of
fact in accordance with the preponderance of the evidence.'" (quoting Holcombe,
304 S.C. at 524, 405 S.E.2d at 822)).
Here, it appears Wife would be able to pay a portion of the GAL fees without
significantly compromising her standard of living based again on her inheritance
and disability/social security income. The issues in the case were very contentious,
and the record demonstrates much of the GAL's time and effort was expended due
to Wife's lack of cooperation and efforts to thwart Husband's relationship with the
children. Consequently, we affirm the family court's decision as to the payment of
the GAL's fees. See Klein v. Barrett, 427 S.C. 74, 89, 828 S.E.2d 773, 781 (Ct.
App. 2019) (affirming the family court's finding that the wife should bear the
majority of the fees and costs because she was in a superior financial position and
because a signification portion of the GAL fees were incurred based on the wife's
conduct during the litigation).
CONCLUSION
To summarize, we find the family court had jurisdiction to determine this case and
affirm the family court's decision to deny Wife's continuance and impose discovery
sanctions. Additionally, we affirm the family court's denial of Wife's request for
alimony and the division of GAL fees. Further, we affirm the family court's
valuation of the marital home and the Honda Odyssey van and the award of both to
Wife. We also affirm the valuation date of the parties' joint checking account and
its award to Wife.
We reverse and remand the family court's award of an unmodifiable, lump sum
child support payment issued as a setoff against Husband's share of the marital
estate. We also reverse the family court's valuation of the parties' joint savings
account as of the date of separation. We modify the family court's decision
regarding the credit card debt as discussed herein. We remand the case to the
family court to recalculate the amounts owing between the parties based on the
changes in the value of certain assets and the reversal of the lump sum child
support award. Additionally and finally, we remand the issue of attorney's fees for
the family court to consider changes in the beneficial results obtained by Husband
in light of this opinion.
AFFIRMED IN PART AS MODIFIED, REVERSED IN PART, AND
REMANDED.
WILLIAMS and HILL, JJ., concur.