Page J. Farnsworth v. Sidney W. Farnsworth, Iii ( 2003 )

IN THE COURT OF APPEALS OF TENNESSEE
AT JACKSON
OCTOBER 17, 2003 Session
PAGE J. FARNSWORTH v. SIDNEY W. FARNSWORTH, III
Direct Appeal from the Chancery Court for Shelby County
No. D30748-III D. J. Alissandratos, Chancellor
No. W2002-01536-COA-R3-CV - Filed February 9, 2004
This case involves the property of a divorced couple and the award of attorney’s fees to the former
wife. For the following reasons, we vacate the decision of the trial court and remand for further
proceedings consistent with this opinion.
Tenn. R. App. P. 3; Appeal as of Right; Judgment of the Chancery Court Vacated and
Remanded
ALAN E. HIGHERS, J., delivered the opinion of the court, in which W. FRANK CRAWFORD , P.J., W.S.,
and DAVID R. FARMER , J., joined.
Aubrey L. Brown, Jr., Memphis, TN, for Appellant
Kimbrough B. Mullins, Kay Farese Turner, Memphis, TN, for Appellee
OPINION
Facts and Procedural History
Sidney W. Farnsworth, III (“Husband”) and Page J. Farnsworth (“Wife”) were married in
1983. The two lived in a house (“the Humes residence”) in Memphis in which Husband held equity
and owned before the marriage. At the time, Husband worked as an insurance company underwriter,
and Wife was, and continues to be, a speech pathologist. As an underwriter, Husband’s income was
approximately $30,000 per year. Subsequently, Husband decided he wished to change vocations and
chose to attend law school to become an attorney, a decision Wife supported. In 1985, Husband and
Wife moved to Nashville so that Husband could attend Vanderbilt University to earn his law degree.
While Husband attended law school, the parties rented their house in Memphis, a task for
which Wife assumed most of the responsibility. In addition, Wife also handled the renting of the
parties’ upstairs as an apartment in their Nashville home in order to pay for part of the Nashville
home’s rent. Wife performed the household chores, providing Husband with time and energy for
his studies. Wife also worked two jobs in the speech pathology field to ensure the parties had
enough income to support themselves. While in law school, Husband worked as a law clerk one
summer and another summer worked for an insurance firm. Husband completed law school at
Vanderbilt and graduated in 1988. Upon graduating, the parties moved back to Memphis and
resumed living in the Humes residence where they continued to reside until separating in 1999.
The parties returned to Memphis where each worked in their respective fields, with Wife
working as a speech pathologist and Husband attaining employment at the law firm, Armstrong,
Allen, PLC, and eventually became a member of that firm. Aside from periodic increases, Wife’s
maximum earning capacity is approximately $47,000 per annum, and Husband’s current earning
capacity is approximately $100,000 per annum.1
As for the parties’ separate property, the evidence at trial showed a sizable disparity. While
Wife testified she held separate property mostly in the form of jewelry valued at approximately
$20,000, Husband admitted to holding an account in Salomon Smith Barney of assets worth almost
$300,000, which he received as a gift from his mother. The parties agreed that the Humes residence
held a fair market value of $90,000. In addition, the parties had accumulated over $300,000 in
marital property. Finally, the parties had incurred debts from credit cards, a second mortgage on
their home, and various fees for attorneys and the guardian ad litem for this cause.
In July 1999, Wife commenced this divorce action alleging grounds of irreconcilable
differences and later amending her complaint to include fault grounds of inappropriate marital
conduct. Husband answered and filed a counter-complaint for divorce in October 2000. A three-day
trial was held in the Shelby County Chancery Court in February 2002, after which the trial court
granted the parties a divorce,2 ordered a division of the marital property in a 60/40 split for the Wife
and Husband respectively,3 and allocated most of the parties’ marital debt to the Husband.4
Additionally, the trial court prorated the guardian ad litem’s fees and ordered Husband to pay all of
Wife’s attorney’s fees. Because Wife had not received any payments for her attorney’s fees, she
moved the court to set payments on this award, and the court below set the amount of Husband’s
monthly payments, adjusting the amount to account for the interest and additional fees accrued since
1
Armstrong, Allen, PLC, utilizes a point system for determining how much income each member receives.
Although there was testimony that Husband’s income was about to be reduced by Armstrong Allen due to Husband’s
diminished productivity, the trial court below found, and this Court has no reason to disagree, that Husband’s earning
capacity per annum is $100,000.
2
The parties stipulated the grounds of divorce.
3
The Court below specified that a sum of $10,000 of W ife’s marital property was to be used to purchase a more
modern, safer car in the interests of the parties’ minor child, and that W ife was to use her portion of the equity of the
Humes residence towards the purchase of a new home.
4
The trial court also addressed issues concerning the parties’ minor child, however, those issues are not
presented to this Court on appeal.
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the final divorce decree. Husband timely appealed from the final divorce decree and presents the
following issues for our review:
I.. The trial court erred in its property division because, as a result of the
allocation of marital debt, the de facto result of the property division
resulted in an inequitable disparity;
II. The trial court abused its discretion when it awarded Wife all of her
attorney’s fees; and
III. In the alternative, the trial court erred when it modified the amount of
attorney’s fees owed to Wife in its order to set payments when such
modification was not pursuant to the procedure of Rules 59 or 60 of
the Tennessee Rules of Civil Procedure.
Wife presents the following additional issue for this Court’s review:
IV. Husband should be ordered to pay Wife’s attorney’s fees from this
appeal.
For the following reasons, this Court vacates the decision of the trial court and remands this cause
for further proceedings consistent with this opinion.
Standard of Review
Our review of a trial court’s marital property division is de novo upon the record with a
presumption of correctness accorded to the trial court’s findings of fact. Tenn. R. Civ. P. 13(d);
Dellinger v. Dellinger, 958 S.W.2d 778, 780 (Tenn. Ct. App. 1997) (citing Haas v. Knighton, 676
S.W.2d 554, 555 (Tenn. 1984); Dalton v. Dalton, 858 S.W.2d 324, 327 (Tenn. Ct. App. 1993)). We
are mindful that trial courts are given wide discretion by appellate courts for the manner in which
they divide marital property, and, therefore, such divisions are given great weight by appellate courts
on appeal. Dellinger, 958 S.W.2d at 780 (citing Wade v. Wade, 897 S.W.2d 702, 715 (Tenn. Ct. App.
1994); Wallace v. Wallace, 733 S.W.2d 102, 106 (Tenn. Ct. App. 1987)). Additionally, the award
of attorney’s fees in a divorce action is within the discretion of the trial court and appellate courts
will not interfere with such awards unless there is a clear showing of an abuse of that discretion.
Aaron v. Aaron, 909 S.W.2d 408, 411 (Tenn. 1995) (citing Storey v. Storey, 835 S.W.2d 593, 597
(Tenn. Ct. App. 1992); Crouch v. Crouch, 385 S.W.2d 288, 293 (Tenn. Ct. App. 1964)). Finally,
all questions of law warrant a de novo review by this Court with no presumption of correctness given
to the trial court. Alford v. Alford, No. E2001-02361-SC-R11-CV, 2003 Tenn. LEXIS 1046, at *5.
(Tenn. Nov. 6, 2003) (citing Union Carbide Corp. v. Huddleston, 854 S.W.2d 87, 91 (Tenn. 1993)).
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Property and Debt Division
Husband first argues that the trial court erred when it divided the marital estate, awarding
Wife 60% and Husband 40% of the property. Specifically, Husband argues that the trial court
created an inequitable disparity in this division when the allocation of the marital debt is considered.
When a trial court divides the marital property of a former husband and wife, it must consider certain
factors in making its division as required by Tenn. Code Ann. § 36-4-121(c) (2003).
In making equitable division of marital property, the court shall consider all relevant
factors including:
(1) The duration of the marriage;
(2) The age, physical and mental health, vocational skills,
employability, earning capacity, estate, financial liabilities and
financial needs of each of the parties;
(3) The tangible or intangible contribution by one (1) party to the
education, training or increased earning power of the other party;
(4) The relative ability of each party for future acquisitions of capital
assets and income;
(5) The contribution of each party to the acquisition, preservation,
appreciation, depreciation or dissipation of the marital or separate
property, including the contribution of a party to the marriage as
homemaker, wage earner or parent, with the contribution of a party
as homemaker or wage earner to be given the same weight if each
party has fulfilled its role;
(6) The value of the separate property of each party;
(7) The estate of each party at the time of the marriage;
(8) The economic circumstances of each party at the time the division
of property is to become effective;
(9) The tax consequences to each party, costs associated with the
reasonably foreseeable sale of the asset, and other reasonably
foreseeable expenses associated with the asset;
(10) The amount of social security benefits to each spouse; and
(11) Such other factors as are necessary to consider the equities
between the parties.
Tenn. Code Ann. § 36-4-121 (c) (2003)
“Marital debts” have been defined by our Supreme Court as “all debts incurred by either or
both spouses during the course of the marriage up to the date of the final divorce hearing.” Alford,
2003 Tenn. LEXIS 1046, at *8. “Unless a court has made provisions for the distribution of property
in a decree of legal separation, a period of separation before divorce has no effect on the
classification of debt as marital or separate.” Id. at *9-10 (footnote omitted). Once it is determined
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that a debt is marital, a trial court should consider the following four factors in allocating such debt:
(1) the debt’s purpose; (2) who incurred the debt; (3) which party benefitted from incurring the debt;
and (4) which party is best able to repay the debt. Id. at *2.
In the case at bar, the trial court heard evidence of credit card debts, bank loans, loans from
family, and a second mortgage on the Humes residence. The Husband challenges the allocation of
the debt by the trial court, which essentially burdened the Husband with 90% of the parties’ debt.
Though there is little dispute as to which party incurred each debt, the record lacks evidence
regarding who benefitted from the debt or the debt’s purpose. In addition, the trial court made no
findings concerning the four factors from Alford. Instead the trial court simply divided the various
debts and, in the case of the second mortgage incurred by Husband, the court below did not find that
it was “acquired properly as a marital debt.” Because it considered the second mortgage a non-
marital debt, the court below appeared not to consider any of the factors except for who had incurred
that mortgage. Therefore, this Court must remand this case to the trial court for a determination of
the proper allocation of the marital debts and marital property in accordance with the Alford decision.
Attorney’s Fees as Alimony in Solido
Because an award of attorney’s fees is considered alimony in solido, the trial court must
consider the relevant factors enumerated in Tenn. Code Ann. § 36-5-101(d)(1)(E) (2003). Koja v.
Koja, 42 S.W.3d 94, 98 (Tenn. Ct. App. 2000) (citing Herrera v. Herrera, 944 S.W.2d 379, 390
(Tenn. Ct. App. 1996); Cranford v. Cranford, 772 S.W.2d 48, 52 (Tenn. Ct. App. 1989)). Because
one of those factors to consider is “[t]he provisions made with regard to the marital property as
defined in § 36-4-121" and this Court has remanded this cause for further findings on the issue of
the parties’ marital debts, we are unable to determine the propriety of an award of attorney’s fees.
Therefore, this Court vacates the trial court’s award of attorney’s fees and remands this cause for a
determination of whether an award of attorney’s fees is proper in light of the trial court’s revised
property division.
Attorney’s Fees on Appeal
Wife argues that she should be awarded her attorney’s fees incurred on this appeal. The
Tennessee Supreme Court has enumerated a number of factors to consider for determining whether
to award a party his or her attorney’s fees on appeal. These factors include the ability of the
requesting party to pay the accrued fees, the requesting party’s success in the appeal, whether the
requesting party sought the appeal in good faith, and any other equitable factor that need be
considered. See Folk v. Folk, 357 S.W.2d 828, 829 (Tenn. 1962). Given our disposition of this
appeal, we hold that it would be improper and inequitable to award attorney’s fees from this appeal
to Wife. See Seaton v. Seaton, 516 S.W.2d 91, 93-94 (Tenn. 1974).
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Conclusion
For the foregoing reasons, we vacate the decision of the trial court and remand this cause for
further proceedings consistent with this opinion. Costs of this appeal are taxed equally to Appellant,
Sidney W. Farnsworth, III, and his surety, and Appellee, Page J. Farnsworth, for which execution
may issue if necessary.
___________________________________
ALAN E. HIGHERS, JUDGE
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