William Hunter Babcock v. Sonnia Elizabeth Babcock ( 2015 )

IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
Assigned on Briefs January 23, 2015
WILLIAM HUNTER BABCOCK v. SONNIA ELIZABETH BABCOCK
Appeal from the Chancery Court for Hamilton County
No. 130724 Ward Jeffrey Hollingsworth, Judge
No. E2014-01670-COA-R3-CV-FILED-MARCH 9, 2015
WILLIAM HUNTER BABCOCK v. SONNIA ELIZABETH BABCOCK
Appeal from the Circuit Court for Hamilton County
No. 13D1231 Ward Jeffrey Hollingsworth, Judge
No. E2014-01672-COA-R3-CV
A married couple entered into a business partnership prior to their marriage. This is a
consolidated appeal from the parties’ divorce action and their partnership dissolution action.
We affirm the trial court’s decision to adjudicate the partnership dissolution action and the
divorce action separately, based on Wife’s failure to raise any argument on this issue in the
trial court. With regard to the remaining issues, however, we vacate the judgment of the trial
court and remand for findings of fact and conclusions of law pursuant to Rule 52.01 of the
Tennessee Rules of Civil Procedure.
Tenn. R. App. P. 3 Appeal as of Right; Judgments of the Chancery and Circuit
Courts
Affirmed in Part; Vacated in Part; and Remanded
J. S TEVEN S TAFFORD, P.J., W.S., delivered the opinion of the Court, in which A RNOLD B.
G OLDIN, J., and B RANDON O. G IBSON, J., joined.
Carol M. Ballard and Bill W. Pemerton, Chattanooga, Tennessee, for the appellant, Sonnia
Elizabeth Babcock.
Sandra J. Bott, Chattanooga, Tennessee and Justin G. Woodward, Ringgold, Georgia, for the
appellee, William Hunter Babcock.
OPINION
Background
On January 26, 2009, William Hunter Babcock (“Husband”) and Sonnia Elizabeth
Babcock (“Wife”) entered into a Partnership Agreement creating the Lambert-Babcock
Partnership (“Partnership”). The parties were not married at the time that they entered into
this agreement. The Partnership Agreement provides, “All properties purchased by either
partner after the date of this Agreement, however titled, shall become partnership property
unless specifically excluded by a written statement signed by all partners.” The Partnership
Agreement reflected Husband’s initial real property contribution to the Partnership of
$60,000.00 made as a down payment on an apartment building in Baltimore, Maryland
(“Maryland property”). Husband stated that his total contribution for the Maryland property
was approximately $200,000.00 because the property required significant refurbishing. The
Partnership also operated an ice cream business in Florida.1 It is unclear how the parties
acquired the ice cream business in Florida; however, Husband testified that he purchased the
equipment for the business and paid the rent. Although Wife did not make any capital
contributions to the Partnership, she managed the partnership properties, including the
Maryland property, and performed other services for the Partnership, such as dealing with
the property’s tenants.
Although Husband later testified that marriage was not contemplated at the time the
parties entered into the Partnership, Husband and Wife eventually married on August 5,
2011. This marriage was Wife’s “fourth or fifth” and Husband’s fifth. No children were born
of the marriage. Husband alleged that he married Wife at her request, but that the marriage
1
The classification and division of the ice cream store does not appear to be in dispute. In its oral
ruling on the partnership dissolution action, the trial court stated that the ice cream store was part of the
Partnership Agreement, “but it’s my understanding there is nothing there so we don’t need to worry about
it.” Further, the ice cream store is not mentioned in the trial court’s final written order, nor is it mentioned
in either party’s brief to this Court. Neither party raises the trial court’s disposition of this property as an
issue on appeal.
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was troubled from the start.
The parties moved to Tennessee in June 2012, when Husband accepted a job with the
Watts Bar Nuclear Power Plant. The parties purchased a home in Red Bank, Tennessee
(“Red Bank home”), where Wife primarily resided after moving to Tennessee. The Red Bank
home was titled in both parties’ names rather than in the name of the Partnership. Husband,
however, did not primarily reside in the Red Bank home, but maintained his own separate
apartment close to his employer.
Soon after the parties’ move to Tennessee, however, both their professional and
personal relationships soured. As such, this appeal stems from two separate actions filed to
dissolve the parties’ relationships: a partnership dissolution action in Hamilton County
Chancery Court and a divorce action filed in Hamilton County Circuit Court. Specifically,
on June 7, 2013, Husband filed his Complaint for Divorce against Wife in the Circuit Court
of Hamilton County. As grounds for divorce, Husband cited irreconcilable differences or, in
the alternative, inappropriate marital conduct. On July 3, 2013, Wife filed a motion for
alimony pendente lite. Shortly thereafter, on July 11, 2013, she filed her answer and her
counter-complaint, citing as grounds inappropriate marital conduct, adultery, indignities
rendering her position intolerable, abandonment, and, in the alternative, irreconcilable
differences. The trial court thereafter entered an order requiring Husband to pay Wife
alimony pendente lite of $500.00 per month.
Several months later, on October 2, 2013, Husband filed his Verified Complaint
against Wife in the Chancery Court of Hamilton County, requesting a dissolution of the
partnership and an order directing an accounting of the assets. Husband specifically asserted
that Wife had converted Partnership assets and breached her fiduciary duties. On the same
day, Husband filed a motion for an immediate temporary restraining order to prevent Wife
from acting on behalf of the Partnership and prevent her from destroying any records related
to the Partnership. As previously discussed, the partnership dissolution action and the divorce
action were filed in two separate courts under two separate docket numbers. On October 3,
2013, however, Judge Hollingsworth of the Hamilton County Circuit Court , the judge
presiding over the parties’ divorce case, entered an order stating that he would preside over
the parties’ dissolution case by interchange. Nothing in the record indicates that either party
objected to Judge Hollingsworth presiding over both cases, nor does the record contain any
request by either party to consolidate the two actions. Indeed, Wife filed no responsive
pleadings in the partnership dissolution action.2
2
The only action by Wife in the partnership dissolution action was a motion by Wife’s counsel
(Continued...)
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The trial court heard proof in both the partnership dissolution and divorce actions on
the same day, June 10, 2014. The facts of this case are gleaned from the transcripts of both
cases. The trial court heard the partnership dissolution action first. At the conclusion of the
partnership dissolution trial, the trial court ruled that the Partnership was dissolved and that
both the Maryland property and Red Bank home were partnership property subject to
distribution in the dissolution action. The trial court ordered the parties to immediately place
the Red Bank home on the real estate market and divide the net proceeds received from its
sale pursuant to the Partnership Agreement, but allowed Wife to occupy the residence an
additional ninety (90) days. The trial court’s written ruling did not mention Husband’s reptile
breeding businesses, which are discussed in more detail, infra; however, the trial court’s oral
ruling reveals that this omission is due to the trial court’s finding that the reptile breeding
businesses did not constitute partnership property. Finally, the trial court ordered that all the
property and assets of the Partnership be liquidated, and that upon sale, the parties present
a full accounting to the court. Each party would also be responsible for his or her portion of
any non-recoverable expenses after liquidation pursuant to the Partnership Agreement. With
the exception of the finding concerning the classification of Husband’s reptile breeding
businesses, the foregoing findings were memorialized in a written order entered August 6,
2014. Neither party raises any issue concerning the trial court’s underlying rulings in the
dissolution action.3
The trial court next considered the parties’ cross-complaints for divorce. The parties’
central disagreements concerned Wife’s entitlement to alimony and the classification and
distribution of the parties’ property. Wife testified that, prior to the parties’ marriage, she
worked for Lucent Technologies and AT&T for twenty years. When she met Husband, her
income was approximately $80,000.00 to $85,000.00 annually. She retired from the company
and became an independent contractor when she met Husband. At trial, the parties disputed
Wife’s reason for quitting her employment; while Husband reiterated that it was Wife who
voluntarily left her employment to avoid her child support obligations, Wife testified that she
did so at Husband’s request. In any event, Wife testified that she could not immediately
return to her previous job, and that she would need approximately two years to complete
(...continued)
to withdraw, which motion was granted. Although the record does not contain a notice of appearance on
behalf of a new attorney, Wife was represented by counsel at both the partnership dissolution and divorce
trials.
3
As discussed in detail, infra, Wife does argue that the trial court erred in not considering the
totality of the parties’ property in the divorce case. Other than the trial court’s decision to bifurcate the
issues, however, Wife does not point to any specific errors made by the trial court in the dissolution
proceeding.
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certifications for her prior job or to finish her biochemistry degree and obtain a job in that
field. As an entry-level worker with a biochemistry degree, Wife testified she could earn
approximately $60,000.00 annually.
In contrast, at the time of trial, Husband was employed as a contractor for the Watts
Bar Nuclear Power Plant, earning approximately $240,000.00 annually. His salary was
deposited into a bank account solely in his name throughout the marriage. Outside of his
employment at the power plant and the Partnership, Husband maintained several other
business ventures, including two reptile breeding businesses, Ophidian and Adnoartina.
According to Husband, both of these businesses began after the commencement of the
Partnership but prior to the parties’ marriage. Husband contributed significant amounts of
money to these two businesses. Between 2012 and 2014, Husband contributed over
$200,000.00 to Ophidian. Between 2012 and 2014, he contributed over $8,000.00 to
Adnoartina. Husband testified that he had not received any returns on the funds he
contributed to either business. Husband stated that he contributed the money, however,
because he was contractually obligated by other partnership agreements to which Wife was
not a party. Wife claims that she was unaware of Husband’s contributions during most of
their marriage. Neither party disputes that Husband’s involvement with these businesses
began prior to the parties’ marriage or that Husband substantially contributed to the
businesses during the marriage.
In addition to his business expenditures for Ophidian and Adnoartina, Husband also
made a payment in 2012 for $4,069.00 on a $25,000.00 loan he allegedly received from his
girlfriend. Husband also testified that, throughout the parties’ marriage, he continued to date
his girlfriend, who loaned him the $25,000.00. Additionally, Husband purchased a
$36,000.00 truck when the parties were separated. Husband listed the same truck as a
$7,000.00 liability on his asset and liability sheet at the time of the divorce.
Wife also inherited a condominium in Florida (“Florida condominium”) from her
father after the parties were married. The Florida condominium was eventually titled in both
parties’ names and Husband contributed significant funds to its repair. In addition to the
parties’ property previously discussed, the record indicates that the parties had other property,
including: two vehicles; a rental property in Chattanooga; at least two more business entities
titled William Hunter Enterprises and William Hunter Properties; Husband’s Simplified
Employee Pension Plan/Individual Retirement Account; Wife’s pension; and miscellaneous
tools, furniture, and personal belongings.
Both parties also testified as to how the parties allocated and paid their living expenses
during the marriage. Wife was able to use the income from the Maryland property for her
personal expenses. Husband testified that he never used any of the funds from this account.
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Husband testified that Wife also received a pension from her employment with Lucent
Technology, but that he was unaware of the amount of the pension or whether she was
currently receiving income from it. In her testimony, Wife does not dispute receiving the
pension from Lucent Technology, but she offers no details as to the amount. Wife also
receives approximately $400.00 per month in rent from the inherited Florida condominium,
although she testified that the entirety of the payments are used to cover the condominium’s
expenses.
The trial court entered the Final Decree of Divorce on August 15, 2014. In its written
order, the trial court granted Wife a divorce based upon Husband’s inappropriate marital
conduct. With regard to the parties’ property, the trial court ruled that the Florida
condominium had transmuted into marital property based on Wife’s actions of jointly titling
it in both parties’ names. Wife does not take issue with this finding on appeal. The court
ordered the parties to immediately place the Florida condominium on the real estate market
and equally divide the net proceeds. Husband was awarded additional property, including his
furniture, tools, and clothing from the Red Bank home, which personal property had not been
previously adjudicated in the partnership dissolution action. The trial court also awarded
Wife a 2006 Honda Ridgeline vehicle and ordered Husband to pay the indebtedness on that
vehicle as alimony in solido.4
With regard to Wife’s request for either rehabilitative or transitional alimony, the trial
court, considering the factors in Tennessee Code Annotated Section 36-5-121, found that this
was a “marriage of short duration, the [Wife] has been provided with temporary support for
one year during the pendency of the separation, and has the education, earning capacity and
separate assets to provide for her own support[.]” As such, Wife’s request for rehabilitative
or transitional alimony was denied by the trial court. Husband was ultimately ordered to pay
Wife’s attorney’s fees of $5,000.00 and court costs as alimony in solido because the trial
court found him at fault in the divorce. Neither of the trial court’s written orders in either the
partnership dissolution action or the divorce action incorporated the trial court’s oral rulings
by reference.
Wife filed a timely appeal of the trial court’s final judgments in both the partnership
dissolution action and the divorce action on August 28, 2014. Initially, the two cases were
assigned two different docket numbers on appeal. On November 13, 2014, at Wife’s request,
this Court consolidated docket number E2014-01670-COA-R3-CV, the partnership
dissolution action, and docket number E2014-01672-COA-R3-CV, the divorce action, into
4
Although the trial court made specific findings as to which party the Honda Ridgeline and
personal property in the Red Bank home would be awarded, the trial court made no specific finding that such
property was marital or separate property, as discussed in detail, infra.
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one appeal under the docket number E2014-01670-COA-R3-CV.
Issues
Wife presents three issues for review:
1. Whether the trial court erred in failing to award rehabilitative
or transitional alimony;
2. Whether the trial court erred in the division of marital
property regarding the transmutation of Wife’s separate property
and Husband’s alleged dissipation of marital assets;
3. Whether the trial court erred in failing to treat the parties’ real
estate partnership as marital property.
Additionally, Husband presents one issue:
1. Whether Husband is entitled to his reasonable attorney’s fees
for defending this appeal.
We address each issue in turn.
Discussion
Classification of Marital Property and Partnership Property
Before we address Wife’s issues regarding the division of marital property and
alimony, we begin with her argument that the trial court erred when it applied partnership law
in dissolving the partnership, rather than domestic relations law. Husband asserts that Wife
has waived this issue on appeal due to her failure to request consolidation of the cases at trial.
We agree that Wife has waived this issue. The only indication that Wife did not
consent to the two separate proceedings is a statement by Wife’s counsel on the day of trial
that the Red Bank home was marital property and not Partnership property. “[T]here is little
difference between an issue improperly raised before the trial court at the last minute and one
that was not raised at all.” In re Adoption of E.N.R., 42 S.W.3d 26, 32 (Tenn. 2001).
Although Wife certainly had ample opportunity to contest the procedure utilized by the trial
court over the seven months that the partnership dissolution action was pending, Wife
registered no objection in the trial court. Wife’s acquiescence on this issue at the trial level
constitutes a waiver of the issue on appeal.
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Division of Marital Property
As we perceive it, Wife next argues that the trial court erred when it did not award her
a larger share of the marital property. With regard to this issue, the trial court’s written order
provides that the Florida condominium was transmuted to marital property and ordered it to
be sold and the net proceeds divided equally. In addition, the trial court awarded Wife the
2006 Honda Ridgeline and ordered Husband to pay the indebtedness on the vehicle and a
portion of Wife’s attorney’s fees, as alimony in solido.
Tennessee law provides that the division of marital property, including its
classification and valuation, are findings of fact. Woodward v. Woodward, 240 S.W.3d 825,
828 (Tenn. Ct. App. 2007). Accordingly, the trial court’s decisions regarding classification,
valuation, and division of property are reviewed de novo with a presumption of correctness
unless the evidence preponderates otherwise. Farrar v. Farrar, 553 S.W.2d 741, 743 (Tenn.
1977). Trial courts have “wide latitude in fashioning an equitable division of marital
property.” Altman v. Altman, 181 S.W.3d 676, 683 (Tenn. Ct. App. 2005); however,
Tennessee Code Annotated Section 36-4-121(c) directs the trial court to consider a list of
factors when making an equitable division of marital property. See Tenn. Code Ann. § 36-4-
121(c) (listing several factors the trial court “shall consider” before equitably dividing the
parties’ marital property). The division of marital property is rooted in equity, and a division
of marital property is not rendered inequitable merely because it is not precisely equal,
Lofton v. Lofton, 345 S.W.3d 913, 923 (Tenn. Ct. App. 2008) (citing Cohen v. Cohen, 937
S.W.2d 823, 832 (Tenn. 1996)), or because each party does not receive a share or portion of
each marital asset. Lofton, 345 S.W.3d at 923 (citing Cohen, 937 S.W.2d at 833).
When making its division of property, the trial court must first classify the property.
Tennessee recognizes two distinct types or classes of property: “marital property” and
“separate property.” The distinction is important because Tennessee Code Annotated Section
36-4-121(a) “provides only for the division of marital property.” See also Batson v. Batson,
769 S.W.2d 849, 856 (Tenn. Ct. App. 1988). In addition, Tennessee Code Annotated Section
36-5-121(b)(1)(B) provides that any increase in value to separate property may be considered
marital property if each party contributed to its preservation and appreciation.
In the instant case, the trial court failed to classify any of the parties’ property with the
exception of the Florida condominium, which was found to be transmuted by virtue of
Husband’s contributions to its repairs into marital property. As previously discussed, in
addition to the Florida condominium, the record shows that the parties have other assets,
including two vehicles, two reptile businesses, Husband’s retirement account, Wife’s
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pension, the two William Hunter businesses, and the rental property in Chattanooga.5 Nothing
in the trial court’s written order indicates that the trial court classified any of this property
as either marital or separate. Further, while one vehicle was specifically awarded to Wife, the
trial court makes no provision or findings of any kind with regard to the other property. Thus,
the trial court did not fulfill its duty to first classify the parties’ property as either marital or
separate.
Furthermore, after a trial court classifies property as marital or separate, Tennessee
law is clear that “[t]rial courts must place a reasonable value on marital property that is
subject to division.” Kraus v. Thomas, No. M2012-00877-COA-R3-CV, 2013 WL 2612458,
at *10 (Tenn. Ct. App. June 7, 2013); Jacobsen v. Jacobsen, No. M2012-01845-COA-R3-
CV, 2013 WL 1400618, at *9 (Tenn. Ct. App. Apr. 5, 2013) (citing Edmisten v. Edmisten,
No. M2001-00081-COA-R3-CV, 2003 WL 21077990, at *11 (Tenn. Ct. App. May 13,
2003)). In addition to the values assigned to marital property, the value of separate property
is important, as it is to be considered by the trial court making an equitable division of the
marital estate. Tenn. Code Ann. § 36-4-121(c). The parties bear the burden “to provide
competent valuation evidence.” Kraus, 2013 WL 2612458, at *10 (citing Kinard v. Kinard,
986 S.W.2d 220, 231 (Tenn. Ct. App. 1998)). “If the parties’ valuation evidence is
conflicting, the trial court ‘may place a value on the property that is within the range of the
values presented.’” Barnes v. Barnes, No. M2012-02085-COA-R3-CV, 2014 WL 1413931,
at *5 (Tenn. Ct. App. Apr. 10, 2014) (citing Watters v. Watters, 959 S.W.2d 585, 589 (Tenn.
Ct. App. 1997)).
In the instant case, although both parties included the proper chart pursuant to Rule
7 of the Rules of the Court of Appeals of Tennessee, the included charts, along with the
record on appeal, reveal that the trial court did not assign a value to any of the parties’
property, marital or separate. Although the parties purport to agree on the values of several
pieces of property, the trial court did not accept or reject these values, so it is unclear to this
Court whether the trial court deemed these values to be supported by competent evidence.
In addition, the parties offer significantly different values for at least one of Husband’s
reptile businesses, Ophidian. Wife valued Ophidian at $150,000.00, while Husband valued
the same business at $50,000.00. Although less stark, the difference in values for Husband’s
other reptile business, Adnoartina, equals $7,500.00. Here, the trial court did not place a
value on any of the parties’ marital or separate assets.
In non-jury cases such as this, Rule 52.01 of the Tennessee Rules of Civil Procedure
provides that trial courts “shall find the facts specially and state separately its conclusions
5
As previously discussed, some property, including the Maryland property and Red Bank home,
were distributed in the partnership dissolution action. Therefore, they were not at issue in the divorce action.
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of law and direct the entry of the appropriate judgment.” Tenn. R. Civ. P. 52.01 (emphasis
added). Prior to July 1, 2009, trial courts were only required to make specific findings of fact
and conclusions of law “upon request made by any party prior to the entry of judgment.” See
Poole v. Union Planters Bank N.A., No. W2009-01507-COA-R3-CV, 337 S.W.3d 771, 791
(Tenn. Ct. App. 2010) (noting the amendment). However, the current version of Rule 52.01
requires the court to make these findings regardless of a request by either party. Id.
This Court has previously held that the requirement to make findings of fact and
conclusions of law is “not a mere technicality.” In re K.H., No. W2008-01144-COA-R3-PT,
2009 WL 1362314, at *8 (Tenn. Ct. App. May 15, 2009). Instead, the requirement serves the
important purpose of “facilitat[ing] appellate review and promot[ing] the just and speedy
resolution of appeals.” Id.; White v. Moody, 171 S.W.3d 187, 191 (Tenn. Ct. App. 2004);
Bruce v. Bruce, 801 S.W.2d 102, 104 (Tenn. Ct. App. 1990). “Without such findings and
conclusions, this court is left to wonder on what basis the court reached its ultimate
decision.” In re K.H., 2009 WL 1362314, at *8 (quoting In re M.E.W. No. M2003-01739-
COA-R3-PT, 2004 WL 865840, at *19 (Tenn. Ct. App. Apr. 21, 2004)). Generally, the
appropriate remedy when a trial court fails to make appropriate findings of fact and
conclusions of law is to “vacate the trial court’s judgment and remand the cause to the trial
court for written findings of fact and conclusions of law,” unless the trial court’s decision
involves only a clear legal issue or the trial court’s decision is readily ascertainable. Lake
v. Haynes, No. W2010-00294-COA-R3-CV, 2011 WL 2361563, at *1 (Tenn. Ct. App. June
9, 2011); Burgess v. Kone, Inc., No. M2007-02529-COA-R3-CV, 2008 WL 2796409, at *2
(Tenn. Ct. App. July 18, 2008). In this case, the issues concerning the portion of the marital
estate awarded to Wife do not involve a clear legal issue, nor is the basis for the trial court’s
division of the marital estate “readily ascertainable.” Id. In the absence of appropriate
findings and conclusions under Rule 52.01 regarding the classification and valuation of all
property at issue, we cannot determine whether Wife was awarded an equitable portion of
the marital estate. Accordingly, we must vacate and remand to the trial court to make the
appropriate findings of fact and conclusions of law.
Dissipation
We next turn to Wife’s argument that the trial court erred in declining to find that
Husband had dissipated marital assets through his funding of two separate business ventures,
Ophidian and Adnoartina, totaling $208,610.00; through his repayment of a loan in the
amount of $5,269.00 to his girlfriend; and through the purchase of a $36,000.00 truck, which
Husband listed as a $7,000.00 liability on his asset and liability worksheet. The trial court’s
written order makes no finding with regard to Wife’s dissipation argument. It is well-settled
that a court speaks through its written orders. Palmer v. Palmer, 562 S.W.2d 833, 837 (Tenn.
1977). As previously discussed, Rule 52.01 mandates that trial court’s make findings of fact
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and conclusions of law to support their decisions incident to bench trials. See Tenn. R. Civ.
P. 52.01. This Court has indicated, however, that we may “soldier on” with our review
despite the trial court’s failure to make sufficient findings of fact and conclusions of law,
“when the case involves a clear legal issue, or when the court’s decision is readily
ascertainable.” Pandey v. Shrivastava, No. W2012-00059-COA-R3-CV, 2013 WL 657799,
at *5 (Tenn. Ct. App. Feb. 22, 2013) (citations omitted).
In this case, the trial court did make an oral ruling at the conclusion of the divorce trial
related to dissipation, stating:
[T]here wasn’t dissipation of assets to where the parties were
put in real financial strain. We can sit here and debate whether
or not this is going to end up being a good investment or a bad
investment, but the fact is he was making enough money he
could pay that and still support them. They chose to live apart.
That’s more expensive. That’s just the way it goes.
The trial court did not make either a written or oral ruling on whether Husband’s repayment
of the loan to his girlfriend or whether his purchase of the truck constituted a dissipation of
assets; indeed, because the trial court frames his consideration in terms of an “investment”
it appears that the trial court only considered dissipation as it related to Husband’s investment
in the reptile businesses. Accordingly, the trial court’s order is deficient with regard to Wife’s
assertion that Husband dissipated assets by repaying a loan to his girlfriend and purchasing
a new vehicle.
In addition, from our perception of the trial court’s oral ruling, the trial court’s
determination that Husband had not dissipated any assets with regard to the reptile breeding
businesses was premised on the trial court’s reasoning that Husband’s expenditures had not
put the parties in “real financial strain.” Tennessee Code Annotated defines “dissipation” as:
“wasteful expenditures which reduce the marital property available for equitable distributions
and which are made for a purpose contrary to the marriage either before or after a complaint
for divorce or legal separation has been filed.” Tenn. Code Ann. § 36-4-121(c)(5)(B). More
specifically, dissipation is “made for a purpose unrelated to the marriage, and is often
intended to ‘hide, deplete, or divert’ marital property.” Larsen-Ball v. Ball, 301 S.W.3d 228,
235 (Tenn. 2010). Dissipation is not a separate factor in the determination of dividing the
parties’ marital property. Altman v. Altman, 181 S.W.3d 676, 682 (Tenn. Ct. App. 2005).
Rather, the dissipation—that is, the “allegedly improper or wasteful expenditure or
transaction”—must be considered in the context of the marriage as a whole. Id.
The trial court’s determination of dissipation in this case does not appear to be
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analyzed under the appropriate standard. When determining whether a particular expenditure
or transaction amounts to dissipation, Tennessee courts frequently apply the following four
factors: “(1) whether the expenditure benefitted the marriage or was made for a purpose
entirely unrelated to the marriage; (2) whether the expenditure or transaction occurred when
the parties were experiencing marital difficulties or contemplating divorce;6 (3) whether the
expenditure was excessive or de minimis; and (4) whether the dissipating party intended to
hide, deplete, or divert a marital asset.” Id. at 682 (citing Halkiades v. Halkiades, No.
W2004-00226-COA-R3-CV, 2004 WL 3021092, at *4 (Tenn. Ct. App. Dec. 29, 2004)). The
trial court’s oral ruling, and certainly the written order, provides no indication that the trial
court considered the foregoing factors in determining whether Husband dissipated marital
assets. Instead, the trial court’s reasoning rests on whether the parties were placed in
“financial strain,” which is not an element courts consider when making a determination of
dissipation. See Altman, 181 S.W.3d at 682.
Based on the foregoing, we are unable to “soldier” in the face of these deficiencies.
The issue of whether Husband dissipated marital assets is remanded to the trial court for
specific findings of fact and conclusions of law in accordance with the foregoing principles.
Alimony
Wife also raises the issue of whether the trial court erred when it declined to award
her rehabilitative or transitional alimony. Because we are remanding to the trial court to make
appropriate findings of fact and reconsider its decisions concerning the equitable division of
the parties’ marital property, we decline to address the remaining issue raised by Wife
concerning whether the trial court erred when it did not award her rehabilitative or
transitional alimony. See Franks v. Franks, No. W2014-00429-COA-R3-CV, 2015 WL
58913, at *18 (Tenn. Ct. App. Jan. 2, 2015) (declining to address the issue of alimony in light
of insufficient findings concerning the valuation of the parties’ property). Because the trial
court’s determinations regarding the division of marital property are subject to change on
remand, any change that the trial court makes on this issue could have a significant effect on
the issue of alimony. See Tenn. Code Ann. § 36-5-121(i) (providing that the trial court shall
consider each parties’ separate property and the division of marital property when
determining whether an award of spousal support is warranted). As such, this issue is
pretermitted.
Attorney’s Fees on Appeal
6
Transactions that were commonplace during the parties’ marriage are typically not deemed to be
dissipation, especially when the other spouse acquiesced to them. Altman, 181 S.W.3d at 682, n.5.
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Finally, Husband requests that this Court award him his reasonable attorney’s fees
incurred in defending this appeal. An award of appellate attorney’s fees is a matter within
this Court’s sound discretion. Archer v. Archer, 907 S.W.2d 412, 419 (Tenn. Ct. App. 1995).
In considering a request for attorney’s fees on appeal, we consider the requesting party’s
ability to pay such fees, the requesting party’s success on appeal, whether the appeal was
taken in good faith, and any other equitable factors relevant in a given case. Darvarmanesh
v. Gharacholou, No. M2004-00262-COA-R3-CV, 2005 WL 1684050, at *16 (Tenn. Ct.
App. July 19, 2005). Considering all of the relevant factors in this case, we respectfully
decline to award Husband’s attorney’s fees in this appeal.
Conclusion
The judgments of the Circuit and Chancery Courts of Hamilton County are hereby
affirmed in part, vacated in part, and remanded. Costs of this appeal are taxed one-half to
Appellant Sonnia Elizabeth Babcock, and her surety, and one-half to Appellee William
Hunter Babcock, for all of which execution may issue if necessary. This cause is remanded
to the trial court for the collection of costs and all further proceedings as may be necessary
and are consistent with this Opinion.
_________________________________
J. STEVEN STAFFORD, JUDGE
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