Morrill v. Morrill

613 S.E.2d 821 (2005) 45 Va. App. 709

Naheed Saeed MORRILL
v.
Clarence Grant MORRILL, II.

Record No. 1461-03-4.

Court of Appeals of Virginia, Richmond.

June 7, 2005.

Alexander B. Berger (Robert H. Cox; Howrey Simon Arnold & White, L.L.P., on brief), Washington, DC, for appellant.

Christopher W. Schinstock (James Ray Cottrell; Gannon & Cottrell, on brief), Alexandria, for appellee.

Present: FITZPATRICK, C.J., and BENTON, ELDER, BUMGARDNER, FRANK, HUMPHREYS, CLEMENTS, FELTON, KELSEY, McCLANAHAN and HALEY, JJ.

UPON REHEARING EN BANC

ELIZABETH A. McCLANAHAN, Judge.

By published opinion dated August 17, 2004, a divided panel of this Court vacated the judgment of the trial court. Morrill v. Morrill, 43 Va.App. 621, 600 S.E.2d 911 (2004). On September 21, 2004, we granted Clarence Morrill's petition for rehearing en banc, stayed the mandate of the panel decision, 44 Va.App. 18, 602 S.E.2d 410 (2004), and reinstated the appeal. Upon reconsideration en banc, we affirm the judgment of the trial court.

Naheed Saeed Morrill (wife) appeals from a final decree of divorce from Clarence Grant Morrill, II (husband). She contends that the trial court erred by reopening the record on an issue heard by the commissioner in chancery, making a finding inconsistent with that of the commissioner, and, thereby, entering an internally inconsistent divorce decree. For the reasons that follow, we affirm the trial court.

I. BACKGROUND

On appeal, we review the evidence in the light most favorable to the party prevailing below. Jacobsen v. Jacobsen, 41 Va.App. 582, 589, 586 S.E.2d 896, 899 (2003) (citation omitted). So viewed, the evidence establishes that wife filed a bill of complaint for divorce from husband on the grounds of desertion and cruelty. Husband filed a cross-bill of complaint for divorce on the grounds of constructive desertion and cruelty.

The trial court entered a decree of reference, "governed by the General Order for Commissioners of March 11, 1996." The general order directs the commissioner in chancery to answer specific questions in a divorce cause. The commissioner's questions pertinent to this case are the following:

6. Were the grounds for divorce alleged in the pleadings proved by corroborated testimony, and if so, how proved?

* * * * * *

8A. For those situations in which either party seeks relief under the so-called equitable distribution provisions of the Code of Virginia, upon request of either party state the circumstances and factors which may have contributed to the dissolution of the marriage, (which shall include any conduct constituting grounds for divorce, any specific act of cruelty and/or any extramarital relationship). However, the effect of that behavior upon the well-being of the family and/or the marital property and its value are to be presented at the equitable distribution hearing. Evidence that a party did not contribute nonmonetarily to the well-being of the family, thereby requiring the other party to take on additional marital responsibilities should also be presented at the equitable distribution hearing.

At the commissioner's hearing, husband presented evidence to establish that he was justified in leaving the marriage because he discovered wife had fraudulently incurred credit card debt, amounting to almost $86,000, in husband's name alone and without his knowledge. However, the commissioner's report recommended that wife's grounds for divorce on desertion be granted because husband had not met his burden of proving the credit card forgery allegation. The commissioner stated,

the evidence on this issue [the credit card debt] is in equipoise. With the testimony of one party in total contradiction of the other party, as clearly supported by the record here, and no other evidence beyond the documents from which both parties are testifying, GRANT MORRILL did not meet his burden of proving by a preponderance of the evidence that NAHEED MORRILL forged his signature in the circumstances and for the purposes to which he has testified.

The commissioner concluded that, even if husband had proven that wife had forged his name to incur the credit card debt without his knowledge or permission, it would not constitute legal justification for deserting the marriage. Husband filed exceptions to the commissioner's report.

At the equitable distribution hearing, the trial court heard husband's exceptions to the commissioner's report, which included objections to the commissioner's findings regarding: (1) the failure to prove legal justification for the husband leaving the marriage, and, (2) the failure to prove the credit card forgery allegations. Husband asked the trial court to take additional evidence from a handwriting expert on the latter issue.

The trial court allowed husband to present evidence on the credit card forgery issue, including testimony by a handwriting expert. At the conclusion of the hearing, the trial court sustained the commissioner's report, but stated, "I don't see any reason why I need to go back and grant the Husband's exceptions on the Commissioner's findings." The court granted wife a divorce on the grounds of desertion, stating that even if husband had proven the credit card forgery allegations, he would not have established a legal justification for deserting the marriage. The court also stated that it found the handwriting expert to be credible, and it accordingly concluded that wife incurred the credit card charges "without [husband's] consent and through a process of forgery." The court further stated, "as to the circumstances contributing to the dissolution of the marriage, while I do not find that the forgeries constitute a legal justification for desertion, I do find that [the forgeries are] a significant factor" in determining an equitable distribution award pursuant to Code § 20-107.3(E).

In the final order, entered on May 9, 2003, the court found that wife amassed credit card debt, by forgery and fraud, in the amount of approximately $86,000, and therefore ordered wife to "fully indemnify the Husband should the Husband hereafter be obligated and required to pay any or all of the total credit card debt." The court also awarded husband any fees and costs associated with calling the handwriting expert in the equitable distribution hearing.^[1]

At the May 9, 2003 hearing on the entry of the final decree, wife, by way of an exception to the final decree, continued to assert that the court was bound by the commissioner's findings on the credit card forgery issue. The court treated wife's exception as a motion for reconsideration, and, after hearing brief argument, denied the motion.

II. ANALYSIS

"When a court refers a cause to a commissioner in chancery, it does not delegate its judicial functions to the commissioner, and it is not bound by the commissioner's recommendations. Rather, the court must review the evidence, apply the correct principles of law, and make its own conclusions as to the appropriate relief required." Dukelow v. Dukelow, 2 Va.App. 21, 26-27, 341 S.E.2d 208, 211 (1986) (citing Lawrence v. Lawrence, 212 Va. 44, 47, 181 S.E.2d 640, 643 (1971)). "The Supreme Court has defined the authority of a commissioner in chancery in an equity proceeding as ``an officer appointed by the chancellor to aid him [or her] in the proper and expeditious performance of his [or her] duties.'" Kelker v. Schmidt, 34 Va.App. 129, 136-37, 538 S.E.2d 342, 346 (2000) (quoting Raiford v. Raiford, 193 Va. 221, 226, 68 S.E.2d 888, 891 (1952)); see also Haase v. Haase, 20 Va.App. 671, 678-79, 460 S.E.2d 585, 588 (1995). Code § 8.01-610 provides: "The report of a commissioner in chancery shall not have the weight given to the verdict of a jury on conflicting evidence, but the court shall confirm or reject such report in whole or in part, according to the view which it entertains of the law and the evidence."

The Fairfax County Circuit Court general order directs commissioners in chancery to answer whether the grounds of divorce alleged in the pleadings were proven. The order also asks the commissioner, in those cases in which a party seeks equitable distribution, to "state the factors and circumstances that may have contributed to the dissolution of the marriage." (Emphasis added). But, it specifically reserves to the trial court the authority to make findings and legal conclusions relative to the possible factors and circumstances and how they affect the well-being of the family, the equitable distribution of the parties' property, and allocation of debt. Those findings and legal conclusions are not to be made at the commissioner's hearing, but are to be made at the trial court's hearing on equitable distribution.

In fact, Code § 20-107.3(E) requires the trial court to consider the factors and circumstances that contributed to the dissolution of the marriage along with the grounds of divorce when dividing or transferring jointly owned marital property, making a monetary award, and apportioning the marital debts of the parties. The commissioner's job is to aid the trial court by stating all possibilities, but the commissioner is not given authority to determine the ultimate question as to whether the factors or circumstances actually had an impact on the break-up of the marriage for purposes of equitable distribution.

Code § 20-107.3(E)(5) requires the court to consider the circumstances and factors that contributed to the dissolution of the marriage without limiting the trial court to considering only the grounds of divorce that were proven. See Code § 20-107.3(E)(5). Whether a party has proven such a factor or circumstance as legal grounds for divorce is different from whether it had an impact on the marriage dissolving. In this case, while not proven as the grounds of divorce, the debt created by the wife's credit card forgeries was a factor that contributed to the dissolution of the marriage. More importantly, Code § 20-107.3(E)(7) specifically requires the trial court to consider "the debts and liabilities of each spouse [and] the basis for such debts and liabilities...." See Gamer v. Gamer, 16 Va.App. 335, 341, 429 S.E.2d 618, 623 (1993); see also Trivett v. Trivett, 7 Va.App. 148, 155, 371 S.E.2d 560, 564 (1988). Finally, Code § 20-107.3(E)(11) authorizes the court to consider any evidence that impacts equitable distribution.^[2] Thus, in this case, the trial court's equitable distribution decision is inseparable from its resolution of the fraud issue. The trial court interpreted the decree of reference and general order as not invading its authority under Code § 20-107.3(E) to examine evidence regarding the effect of the forgery allegations on the marital property and equitable distribution award.^[3]

Upon a review of the record, it is clear that the commissioner's scope of referral under the decree of reference and general order was limited to answering whether the grounds of divorce alleged in the pleadings were proven and to state any circumstance or factor that may have contributed to the dissolution of the marriage. The commissioner and the trial court interpreted the decree and order as so limited. In her report, the commissioner limited discussion on the forgery issue to whether the evidence presented at the commissioner's hearing satisfied the burden of proof for desertion. The commissioner stated that the evidence on the forgery issue was found to be in "equipoise" —neither proven nor disproven. The commissioner did not make a factual finding that wife did not commit the forgery. Instead, the commissioner wrote, "GRANT MORRILL did not meet his burden of proving by a preponderance of the evidence that NAHEED MORRILL forged his signature...." Whether wife had committed fraud in incurring the debt was not before the commissioner. The only finding that the commissioner made with regard to the forgery was to state, "However, even if true, the circumstances do not necessarily give rise to a finding of legal justification, as argued by him, or preclude the finding of desertion based on the evidence presented."

The court accepted and affirmed the commissioner's report with regard to its findings on the issue of whether the grounds of divorce had been proven. However, affirmation of the commissioner's finding on the grounds of divorce issue did not preclude the court from hearing evidence on the forgery allegations with regard to their effect on the equitable distribution award. The forgery allegations were a factor and circumstance that led to the dissolution of the marriage, even though not proven as a justification for desertion.

The trial court's interpretation of the decree of reference and general order was reasonable and falls within the latitude we afford trial courts in the construction of their own decrees. On appeal, "``when construing a lower court's order, a reviewing court should give deference to the interpretation adopted by the lower court.'" Albert v. Albert, 38 Va.App. 284, 298, 563 S.E.2d 389, 396 (2002) (quoting Fredericksburg Constr. Co. v. J.W. Wyne Excavating, Inc., 260 Va. 137, 144, 530 S.E.2d 148, 152 (2000); Rusty's Welding Serv., Inc. v. Gibson, 29 Va.App. 119, 129, 510 S.E.2d 255, 260 (1999) (en banc)). Thus, we do not find that the court abused its discretion in hearing the forgery evidence for purposes of equitable distribution under its interpretation of the decree and general order.

Husband requests the Court to direct wife to pay his attorney's fees and costs incurred on appeal. See O'Loughlin v. O'Loughlin, 23 Va.App. 690, 695, 479 S.E.2d 98, 100 (1996). On review, the litigation addressed appropriate and substantial issues, and wife did not generate unnecessary delay or expense in pursuit of her interests. Therefore, the request is denied.

III. CONCLUSION

The commissioner was not authorized to make findings on equitable distribution; that task was left to the trial court. The commissioner reported on the grounds of divorce in accordance with section 6 of the general order of reference, and the trial court made its findings on equitable distribution, as required by Code § 20-107.3 and section 8A of the order of reference. Accordingly, the judgment of the trial court is affirmed.

Affirmed.

HUMPHREYS, J., with whom BENTON, FRANK, CLEMENTS, and FELTON, JJ., join, dissenting.

I disagree with the majority's conclusion that, under the circumstances of this case, the trial court was permitted to hear additional evidence relating to a finding of fact that had already been made by the commissioner in chancery and accepted by the trial court. Because I would reverse the judgment of the trial court, I respectfully dissent.

A.

Decisions concerning the admissibility of evidence are committed to the sound discretion of the trial court. Blain v. Commonwealth, 7 Va.App. 10, 16, 371 S.E.2d 838, 842 (1988). However, "a trial court has no discretion to admit clearly inadmissible evidence because admissibility of evidence depends not upon the discretion of the court but upon sound legal principles." Gray v. Rhoads, 268 Va. 81, 86, 597 S.E.2d 93, 96 (2004) (internal quotations omitted). Similarly, "``[a]lthough trial courts have discretion to interpret their own orders, that discretion must be exercised reasonably and not arbitrarily or capriciously.'" Smoot v. Commonwealth, 37 Va.App. 495, 500, 559 S.E.2d 409, 411-12 (2002) (quoting Rusty's Welding Serv. v. Gibson, 29 Va.App. 119, 130, 510 S.E.2d 255, 261 (1999)).

Generally, a court order "``must be interpreted within its four corners.'" Id. (quoting United States v. Armour & Co., 402 U.S. 673, 682, 91 S. Ct. 1752, 29 L. Ed. 2d 256 (1971)). According to the decree of reference, entered December 11, 2002, the trial court referred these divorce proceedings to the commissioner "for the purpose of taking evidence of the parties and their witnesses, and reporting to [the trial court] findings, conclusions of law, [and] recommendations in regard to the allegations contained in the pleadings." The decree further indicates that its execution was to be "governed by the General Order for Commissioners," which provides, in pertinent part, that the commissioner is to make findings as to "the circumstances and factors which may have contributed to the dissolution of the marriage," but that evidence as to "the effect of that behavior upon the well-being of the family and/or marital property and its value [is] to be presented at the equitable distribution hearing." (Emphasis added).

Thus, under the "four corners" of the decree, the commissioner was responsible for receiving evidence and making factual findings as to the factors (including the parties' behavior) that contributed to the dissolution of the marriage. The trial court, in contrast, was responsible for receiving evidence and making factual findings as to how those factors affected the marriage and the value of the marital estate.

Here, the commissioner received evidence from both parties on the issue of whether wife engaged in certain "behavior"—specifically, whether she forged husband's name on multiple credit card receipts. The commissioner then made a factual finding that, based on the evidence before her, husband failed to prove that wife engaged in that behavior. Specifically, the commissioner found that

[T]he evidence on this issue is in equipoise. With the testimony of one party in total contradiction of the other party, as clearly supported by the record here, and no other evidence beyond the documents from which both parties are testifying, [husband] did not meet his burden of proving by a preponderance of the evidence that [wife] forged his signature in the circumstances and for the purposes which he has testified.

During the equitable distribution hearing, the trial court accepted the commissioner's report, but it then permitted husband to present additional evidence on the issue of whether wife engaged in the alleged "behavior." However, once the commissioner determined that wife did not engage in that behavior, and the trial court accepted that finding of fact, the decree of reference limited the trial court to receiving evidence as to the effect of wife's behavior upon the marriage—not whether she engaged in that behavior in the first place.^[4]

For example, if the commissioner had determined that wife forged husband's name upon the credit card receipts, the trial court would have been authorized to receive evidence as to the effect of wife's forgery upon the marriage and the marital estate. But even under those circumstances, the trial court would have been precluded from allowing wife to present additional evidence to prove that, contrary to the commissioner's finding, she did not commit the alleged forgery.^[5]

Simply put, on the issue of whether wife committed forgery, the parties were limited to the evidence they had already presented to the commissioner. Unquestionably, the trial court had the authority to reexamine the evidence that was presented to the commissioner and to conclude, based upon an independent review of that evidence, that the commissioner's factual findings were erroneous. See Orgain v. Butler, 255 Va. 129, 132, 496 S.E.2d 433, 435 (1998) (noting that, "[a]lthough the report of a commissioner in chancery does not carry the weight of a jury verdict, the report should be sustained unless the chancellor concludes that the commissioner's findings [of fact] are not supported by the evidence ... taken in the commissioner's presence" (emphasis added) (citation omitted)); see also Code § 8.01-610. But neither Code § 8.01-610 nor this decree of reference reserve to the trial court any authority to hear additional evidence to use as a predicate for deciding whether a particular finding of fact was, in fact, erroneous.

Thus, I would hold that the decree of reference clearly delegated to the commissioner the responsibility to receive evidence and to make factual findings relating to wife's "behavior." And, once the commissioner found that wife did not engage in that behavior, the evidentiary record on that particular issue was closed and should not have been reopened unless husband met his burden of proving that the evidence satisfied the four-prong test set forth in Joynes v. Payne, 36 Va.App. 401, 551 S.E.2d 10 (2001).

B.

In Joynes, this Court held that a party's attempt to introduce "additional evidence into the record after the commissioner has filed his report is treated as a motion to receive after-discovered evidence." Id. at 418, 551 S.E.2d at 18. Thus, in order to reopen the record, four requirements must be met:

(1) the evidence must have been discovered after the record was closed; (2) it could not have been obtained prior to the closing of the record through the exercise of reasonable diligence; (3) it is not merely cumulative, corroborative, or collateral, and (4) it is material, and, as such, should produce an opposite result from that contained in the commissioner's report.

Id.

Here, husband did not present any evidence indicating that the expert witness testimony "was discovered after the record was closed," nor did he contend that the evidence "could not have been obtained prior to the closing of the record through the exercise of reasonable diligence." Because husband did not carry his burden of proving that the evidence met the four-prong test required for admitting after-discovered evidence, I would hold that the trial court erred when it reopened the record on the issue of wife's alleged forgery.

C.

For these reasons, I believe that the trial court abused its discretion because it erred, as a matter of law, in reopening the record to hear additional evidence on the issue of whether wife engaged in the alleged behavior. See Congdon v. Congdon, 40 Va.App. 255, 262, 578 S.E.2d 833, 836 (2003) (noting that the trial court abuses its discretion if it uses "an improper legal standard in exercising its discretionary function" (internal quotations omitted)); see also Gray, 268 Va. at 86, 597 S.E.2d at 96. Because I would reverse the judgment of the trial court, I respectfully dissent.

NOTES

[1] We need not address the issue of the trial court's award of attorney's fees and costs to husband, because wife has abandoned that issue for rehearing en banc. See Schwartz v. Brownlee, 253 Va. 159, 161-62, 482 S.E.2d 827, 829 (1997) (failure to include an assignment of error in the petition for rehearing constitutes an abandonment of that assignment of error). Wife did not raise the issue as a question presented nor develop any argument on it in her en banc brief. Cf. Rule 5A:20. See Buchanan v. Buchanan, 14 Va.App. 53, 56, 415 S.E.2d 237, 239 (1992); see also Rogers v. Rogers, 170 Va. 417, 421, 196 S.E. 586, 588 (1938).

[2] Code § 20-107.3(E)(11) states "[s]uch other factors as the court deems necessary or appropriate to consider in order to arrive at a fair and equitable monetary award."

[3] Wife characterizes the evidence husband presented to the trial court as "additional evidence" subject to the test recited in Joynes v. Payne, 36 Va.App. 401, 551 S.E.2d 10 (2001). We disagree. Joynes involved a situation where all of the issues in the divorce proceeding were referred to the commissioner in chancery. In that case, there was nothing left for the trial court to do but to hear exceptions to the commissioner's report, either confirm or reject the report, and enter the final decree. In Joynes, this Court stated that it would not consider whether the request to present additional evidence was improperly denied, as the record did not disclose the nature of the evidence and the circumstances surrounding the request. Id. at 418, 551 S.E.2d at 18. In the case at bar, there were "no other issues [for the commissioner] to recommend or report to the court, other than the factors and circumstances contributing to the dissolution of [the] marriage; fault grounds to the extent pled or testified and the other statutory requirements to establish the jurisdiction of the court in the divorce proceeding." (Transcript from commissioner's hearing, February 14, 2003, p. 5, lines 10-15.) Every other issue in the proceeding was reserved to the trial court, including the issue of equitable distribution. The Joynes test for admission of additional evidence, therefore, does not apply.

[4] The majority states that the commissioner merely found that husband failed to carry his burden of proof, concluding that this statement is not equivalent to a factual finding that wife did not commit forgery. However, as wife argues, courts typically state factual findings in terms of a party's failure to meet his burden of proving that particular fact. See, e.g., Woo v. Smart, 247 Va. 365, 371, 442 S.E.2d 690, 694 (1994) ("The trial court made the factual finding that the [party] ``failed to carry her burden of proo[f] ....'" (emphasis added)). Thus, implicit in a court's statement that a party failed to carry his burden of proof is a finding that, for purposes of those proceedings, the "fact" (e.g., "forgery") does not exist, and the status quo (e.g., "no forgery") controls. See, e.g., Brothers Constr. Co. v. Va. Empl. Comm'n, 26 Va.App. 286, 294-95, 494 S.E.2d 478, 482 (1998) (noting that, if an employer "fails to meet its burden of pro[ving]" that an employment relationship does not exist, the court must presume that an employment relationship does exist); see also Charles E. Friend, The Law of Evidence in Virginia § 9-3(a)(2) (6th ed. 2003) ("The party who seeks to change the status quo... is often said to have the burden of proof.").

[5] The trial court reasoned, and the majority implies, that husband should be permitted to introduce additional evidence relating to wife's alleged behavior because husband was introducing the evidence "in a different context, and for a different purpose." However, under the circumstances of this case, the subjective purpose for which the evidence was offered is irrelevant. By the very nature of these bifurcated proceedings, evidence introduced in the first phase would be in a "different context" and for a "different purpose" than evidence introduced in the second phase. But the fact that the legal issue being decided differs from phase to phase of a trial or other court proceeding does not make evidence relating to an already-determined factual issue admissible in the later phase to prove or disprove that same fact. Cf. McDaniel v. Anheuser-Busch, Inc., 987 F.2d 298, 305 (5th Cir.1993) (noting that, where the district court ordered a separate trial on the issue of causation, "if the first jury decides the causation issue, the second jury cannot consider that same issue"). This would be akin to permitting a criminal defendant to relitigate the issue of his guilt during sentencing proceedings.