Mansur Rahnema v. Shahla Rahnema

COURT OF APPEALS OF VIRGINIA
Present: Judges Humphreys, Felton and Haley
Argued by teleconference
MANSUR RAHNEMA
MEMORANDUM OPINION* BY
v. Record No. 1199-05-1 JUDGE JAMES W. HALEY, JR.
MARCH 14, 2006
SHAHLA RAHNEMA
FROM THE CIRCUIT COURT OF THE CITY OF VIRGINIA BEACH
Frederick B. Lowe, Judge
James Ray Cottrell (Kyle F. Bartol; John K. Cottrell; Gannon &
Cottrell, P.C., on briefs), for appellant.
Kimberly L. Stegall (Glenn R. Croshaw; Peter V. Chiusano;
Willcox & Savage, P.C., on brief), for appellee.
In this proceeding, Mansur Rahnema (“husband”) asserts that the trial court erred in the
following: 1) classifying the St. Edmunds Terrace property as marital, rather than separate, property
and failing to address rental income from the property; 2) classifying the High Mount property as
Shahla Rahnema’s (“wife”) separate property rather than marital property; 3) finding that the
spousal support payment required by the post-nuptial agreement was not satisfied; 4) failing to
address legal fees incurred by husband in connection with The Beeches property and husband’s
argument that wife was the beneficial purchaser of said property; 5) applying $419,585 held by
husband’s English solicitors to his share of the property division; 6) refusing to hear evidence on
federal income taxes incurred by disbursement of his pension plan account so that such costs could
be considered in the division of the marital estate; 7) failing to address husband’s allegations that
wife improperly transferred marital funds into a separate account; 8) refusing to hear evidence on
*
Pursuant to Code § 17.1-413, this opinion is not designated for publication.
wife’s alleged conversion of marital property; and 9) failing to determine if money accidentally
transferred into husband’s retirement account instead of a corporate account should be returned. We
affirm in part, reverse in part, and remand.
Facts
The parties married April 24, 1993 in Virginia Beach, Virginia. The marriage produced no
children. On July 28, 1993, the parties entered into a post-nuptial agreement (“the Agreement”)
defining what property would constitute the marital estate in the case of a divorce and setting an
amount for spousal support, among other provisions. The Agreement includes a schedule of
husband’s assets and declares that those assets, except for husband’s medical practice, Virginia
Beach Surgical Associates (“VBSA”), are marital property, even if owned prior to the marriage.
Wife’s assets obtained prior to the marriage remain her separate property. It also declares that all
property acquired during the marriage shall be marital property and jointly owned regardless of the
source of funds used to purchase and the titling of the property. In the event of a divorce, each
spouse is to receive an equal share of the marital estate as defined by the Agreement following an
inventory and valuation by the court. Should the divorce occur within the first five years, husband
agreed to pay wife a lump sum of $100,000 in lieu of spousal support. Other provisions of the
Agreement are irrelevant to these proceedings.
A later set of agreements, signed in 1994, purported to supplement the Agreement. Upon
filing for a divorce in November 1997, husband attempted to have both the Agreement and the 1994
supplements declared unenforceable. The trial court ruled that the Agreement was enforceable but
the supplements were not, and this Court affirmed that decision in Rahnema v. Rahnema, 2000
Va. App. LEXIS 163 (Mar. 7, 2000). The trial court granted the divorce on April 23, 1999.
While proceedings continued to divide the marital estate under the terms of the marital
agreement, husband filed suit to have the marriage annulled on grounds of bigamy. The trial court
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heard evidence on the matter and ruled the marriage was not bigamous and therefore not void, a
ruling upheld by this Court in Rahnema v. Rahnema, ___ Va. App. ___, ___ S.E.2d ___ (Feb. 14,
2006).
Despite the pending annulment litigation, the trial court continued to hear evidence and
address the division of the marital estate. Due to the scope of the Agreement, it controls all property
division, superceding the equitable distribution statutes. After taking evidence for nearly eight
years, the trial court ruled from the bench on March 25, 2005, a ruling partially memorialized in a
written order May 4, 2005. Husband appeals from this ruling, the third time these parties have
come before this Court.
Given the number of assignments of error and their fact specific nature, additional facts are
presented within the discussion of each point.
Standard of Review
Under familiar principles, we review the construction of a marital agreement de novo.
Smith v. Smith, 3 Va. App. 510, 513, 351 S.E.2d 593, 593 (1986). A trial court may not distribute
property in a way that is inconsistent with a contract. Parra v. Parra, 1 Va. App. 118, 128, 336
S.E.2d 157, 162-63 (1985). The trial court’s factual findings, however, when resulting from
evidence heard ore tenus, will be reversed only when plainly wrong or without supporting evidence.
Wheeler v. Wheeler, 42 Va. App. 282, 288, 591 S.E.2d 698, 701 (2004). Furthermore, we will
consider the evidence in the light most favorable to wife as the prevailing party below. Galloway v.
Galloway, 47 Va. App. 83, 86, 662 S.E.2d 267, 268 (2005) (citation omitted).
St. Edmunds Terrace
During the marriage, wife purchased property in England at 28 St. Edmunds Terrace (“St.
Edmunds”) with marital funds, making it marital property under the Agreement. Concurrent with
the proceedings in the trial court, the parties were involved in an English lawsuit with respect to
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various transactions undertaken by wife and Ms. Panthea Ansari, her daughter from a previous
marriage, concerning St. Edmunds. On January 13, 2004, the trial court entered an agreed order,
tendered by wife, adopting the final order of the English court and specifically stating that
husband’s one-half interest in St. Edmunds “is declared to be separate property.”
The Virginia trial court’s final ruling, however, includes St. Edmunds as marital property
that counts towards husband’s one-half share of the marital estate on the schedule attached to the
final order. Husband contends this ruling is in error, and we agree.
The January 13, 2004 order of the trial court settles the question by declaring St. Edmunds
to be husband’s separate property. Wife’s acceptance that the remaining one-half interest in St.
Edmunds is husband’s separate property is not limited to that order, however. On October 17, 2003,
wife’s counsel reminded the trial court that the question of St. Edmunds’ ownership was already
settled by the English order. At that same time, the parties agreed that they must abide by the
English decision because the trial court had no jurisdiction over real property in England.
Furthermore, wife’s brief concedes that the trial court “acknowledged that Ms. Ansari and
Dr. Rahnema were the owners of the property and Ms. Rahnema lacked an interest therein.”
In considering St. Edmunds to be marital property and applying its value towards husband’s
share of the marital estate, the trial court contradicted its own previous order and violated the clear
terms of the Agreement, thereby abusing its discretion. Therefore, we reverse the trial court’s final
order, re-affirm that St. Edmunds is husband’s separate property, and remand for a redistribution of
the marital estate in accordance with this ruling.
Husband further contends that the trial court erred by not accounting for rents received by
wife for St. Edmunds after the property became his and Ms. Ansari’s separate from wife. While the
English court order adopted by the trial court on January 13, 2004, declares that Ms. Ansari and
husband split future rents, the trial court declined to consider the issue of rents as part of its
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distribution of the marital estate. Given that all rents subject to the order were received after the
parties’ divorce and, therefore, are not subject to distribution under the Agreement, we see no error
in the trial court’s decision. Nor, however, do we, or does wife in her brief, see any decision of the
trial court preempting husband’s right to pursue any rents he is due in the appropriate venue.
High Mount Property
The trial court ruled that the High Mount property was wife’s separate property rather than
marital property under the terms of their agreement. Wife initially purchased High Mount in 1989.
At some point, the property went into foreclosure until someone made a payment of £100,000 UK
in 1995. At trial, the parties disputed who actually made this payment, with the trial court ruling
that wife paid the sum. Finding this ruling to be plainly wrong, we reverse.
Wife’s only evidence supporting this ruling is her own testimony that she paid the sum and
an account statement showing a £100,000 UK transfer from her bank account to the Allied Irish
Bank. She testified that this transfer was to her English solicitors in order to pay off the mortgage.
Husband testified that he had paid the mortgage and presented letters from wife’s solicitors
acknowledging his payment of the £100,000 UK. Thus, the very people wife testified she
transferred the money to in payment of the mortgage confirm that, in actuality, husband paid the
mortgage. Wife’s evidence, then, does nothing more than show a transfer of money between bank
accounts, while husband offers conclusive proof of his payment.
Furthermore, both parties agree that the property was titled in husband’s name after the
payment before being retitled in wife’s name. Wife’s attorneys undertook the retitling for husband
within a week of his having paid off the mortgage and as part of the same transaction. And while
his having paid off the mortgage explains why the title was in his name, wife contends that after she
paid off the mortgage, she titled the property in her husband’s name because the “mortgage people”
advised her to do so.
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Given that wife’s own English solicitors acknowledged husband’s payment of the mortgage
and that wife’s evidence does nothing more than show a transfer of money between accounts, we
conclude that the trial court’s finding that wife paid the mortgage on High Mount was plainly
wrong.
Having so found, the High Mount property must be part of the marital estate under the terms
of the Agreement. The agreement provides that “[a]ll property which is acquired during marriage
and prior to any separation of the parties . . . shall also be deemed marital property and shall be
jointly owned.” When husband paid the £100,000 UK to bring the property out of foreclosure and
took title to the property, he acquired it from wife. Thus, what had previously been her separate
property became marital property. We, therefore, reverse the trial court’s finding that High Mount
is wife’s separate property and remand the division of the marital estate to the trial court for
redistribution in accordance with this decision.
Spousal Support
The Agreement requires that husband pay wife a lump sum of $100,000 in lieu of spousal
support in the event that the parties separate or divorce within five years of marrying. Early in the
divorce proceedings, the trial court ordered husband to pay his own and wife’s attorneys each
$100,000 out of the VBSA’s account. If the court later found that the account was husband’s
separate property, the payment would satisfy his spousal support obligation, and if the account was
found to be marital, the paired payments would constitute an equal division of marital property,
leaving the spousal support unsatisfied.
Husband, however, paid the $100,000 from Charles Schwab Account #9089-8173, rather
than the account specified by the court. The question for the trial court to rule on, then, was if that
Charles Schwab account was marital or separate. While both sides briefed the issue, the trial court
never ruled on whether the account was marital or separate. Instead, the court compounded its error
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by confusing wife’s alleged payment of £100,000 UK toward the High Mount mortgage with the
$100,000 spousal support payment. It then concluded that since wife paid the £100,000 UK
husband was still obligated to make the spousal support payment.
The trial court’s ruling is clearly in error, as it confuses payments, accounts, and even the
amount in question. In the end, the critical question of whether the Charles Schwab Account was
marital or separate property remains unanswered. We, therefore, remand this question to the trial
court for a determination as to whether the account in question was marital or separate.
The Beeches
Husband’s pension plan account, a marital asset, purchased as an investment an English
property known as The Beeches. During the proceedings, each party was at some point under a
court order to purchase the property from the pension plan. Neither party ever did so, and after a
great deal of litigation both here and in England, the property was eventually sold to Mr. Cyrus
Davari for £750,000 UK. Relating to this sale, husband makes two separate claims: 1) that the
trial court erred in failing to reimburse him for expenses related to the maintenance and sale of
The Beeches; and 2) that he should have been allowed to introduce additional evidence that wife
was the de facto purchaser of the property. Finding insufficient evidence to support husband’s
contentions, we affirm.
Although husband claims to have not been reimbursed or credited for expenses relating to
The Beeches, the trial court’s orders show he received compensation numerous times. As to the
other expenses not compensated by the trial court, we agree that husband failed to meet his
burden of showing what the expenses were and how they were incurred. Furthermore, we find
that the trial court did not err in declining to provide additional compensation to husband for
those instances when the initial compensation he received went to satisfy debts to third parties.
Certainly, no party should receive duplicate reimbursement for expenses simply because the
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initial payments had to go to his creditors in accordance with English court orders. Finally, we
note the trial court’s suggestion that any additional litigation over these expenses occur in a
different, more appropriate venue.
As to husband’s contention that wife was the beneficial purchaser of the property, the
trial court had sufficient evidence to reach its conclusion that she was not, in fact, the purchaser
of the property. At the time it approved the contract, the trial court had read the agreement,
received the required deposit, and received affidavits sufficient to prove that the money was
Mr. Davari’s and not wife’s. Although these affidavits are not in the record, they were given at
the specific request of the trial court, and we, therefore, defer to its decision to accept whatever
documents were offered to fulfill its demands. We find no evidence whatsoever to support
husband’s contentions on this point except his own accusations. Given that over two years
passed between the sale of The Beeches and the trial court’s final ruling on the issue, we find
husband’s inability to provide any real evidence of misdeeds telling. Therefore, we affirm the
trial court’s decision.
£218,000 UK Held by Dean and Dean
Husband claims the trial court erred in including £218,000 UK held by his English
solicitors, Dean and Dean, in his share of the property division. Dean and Dean received these
funds in conjunction with the sale of The Beeches property and was ordered by the trial court
multiple times to transfer this money into the pension plan account, from which its reasonable
expenses could be reimbursed. The parties agree, however, that at no time did the trial court ever
determine the appropriate amount for Dean and Dean’s expenses and fees.
Faced with an English law firm that refused to obey its orders, the trial court chose to
credit the entire £218,000 UK toward husband’s share of the marital estate. As it is husband’s
attorneys who are holding the funds and the trial court’s efforts to recover the funds have been
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unsuccessful, the trial court had no choice but to distribute the funds in some way and allow the
parties to explore alternative remedies outside the distribution proceedings. The court concluded
that husband was in the best position to do so, and we see no clear error in that decision.
Accordingly, we affirm the award of the funds held by Dean and Dean to husband.
Failure to Account for Federal Taxes Incurred by Court-Ordered Disbursements
During the lengthy proceedings in this case, the trial court occasionally ordered
disbursements from husband’s pension plan account. That money enabled the parties to cover
living and trial-related expenses while the bulk of their accounts were frozen pending
distribution. Throughout the course of the trial, both sides have agreed, and the court has
encouraged, that the entry of a Qualified Domestic Relations Order (QDRO) could solve the
problems of federal tax liability.
Neither side, however, has tendered such an order to the court so the problem remains.
Because the trial court had jurisdiction to rule on the Agreement under Code § 20-107.3(I)
(allowing the incorporation of an agreement between the parties into a divorce decree), it retains
jurisdiction of this case to modify orders related to that agreement under Code § 20-107.3(K)(4).
We decline to review the trial court’s decision not to enter an order while it still retains
jurisdiction over the issue.
Wife’s Transfer of Marital Funds Post Separation
Husband claims that wife has sequestered marital funds in a Swiss bank account to
prevent the trial court from distributing those funds between the parties. The parties agree that in
late November 1997 wife transferred over $200,000 from her National Westminster Bank
account into a Swiss bank account. Wife testified that she used portions of this money, which
the trial court found was her separate property stemming from a previous divorce, for living
expenses and then transferred the remainder of the National Westminster Bank funds into her
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Bank of Tidewater account, which had a balance in January 1998 of $163,290.75. While
documents establish the transfer from the National Westminster Bank to Switzerland, only wife’s
testimony supports the transfer to Bank of Tidewater.
Husband, however, cites no evidence in his brief, nor can we find any in the record, that
contradicts wife’s explanation of the use of funds. The Supreme Court has said, “a trier of fact
. . . may not arbitrarily disregard uncontradicted evidence of unimpeached witnesses which is not
inherently incredible and not inconsistent with facts in the record, even though such witnesses
are interested in the outcome of the case.” Jarvis v. Tonkin, 238 Va. 115, 121, 380 S.E.2d 900,
904 (1989) (citations omitted). Here, wife’s evidence is uncontradicted and is consistent with the
evidence in the record. Therefore, neither we nor the trial court may “arbitrarily disregard” her
testimony, which husband asks us to do here. Given husband’s lack of evidence in support of his
contention, we cannot say that the trial court abused its discretion in believing the only evidence
available and finding that the transfer was acceptable.
Wife’s Alleged Marital Waste
Husband asserts that the trial court erred by denying him the opportunity to present
evidence of wife’s marital waste. He claims that wife committed marital waste when she
transferred money from marital accounts into her separate accounts before the separation. In so
doing, he argues, she thereby prevented him from receiving the 50% of that money to which he
was entitled under the Agreement.
Generally, “[t]he admissibility of evidence is within the broad discretion of the trial court,
and a ruling will not be disturbed on appeal in the absence of an abuse of discretion. Evidence is
admissible if it tends to prove a matter that is properly at issue in the case and if its probative
value outweighs policy considerations.” Blain v. Commonwealth, 7 Va. App. 10, 16-17, 371
S.E.2d 838, 842 (1988) (citing Coe v. Commonwealth, 231 Va. 83, 87, 340 S.E.2d 820, 823
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(1986); Levine v. City of Lynchburg 156 Va. 1007, 1014, 159 S.E.2d 95, 97-98 (1981)). A court
must provide “a reasonable opportunity to develop and present evidence of value.” Mosely v.
Mosely, 19 Va. App. 192, 195, 450 S.E.2d 161, 163 (1994).
In this instance, the trial court declared that it would not hear evidence of any transfers by
wife from marital accounts to separate accounts before the separation occurred. To the extent
that any such transfers decreased the marital estate, they deprived husband of his 50% share of
marital assets guaranteed by the Agreement. Evidence in the record provides at least some
support to husband’s contention that wife illegally transferred money out of some pension plan
accounts for her own use in the form of letters from the plan managers. While wife was certainly
free to spend marital assets during the marriage, under the Agreement any property purchased
with those marital funds would be marital property for division and any funds deposited in her
separate accounts remain marital and should be accounted for in the final distribution.
Since husband provided evidence of some wrongdoing by the wife that deprived him of
property to which he is entitled, the trial court abused its discretion when it refused to allow
husband to present any such evidence. Therefore, we reverse the trial court’s ruling that
evidence of the pre-separation transfers was inadmissible and remand this issue to allow husband
to present his evidence of wrongdoing.
Husband also claims the trial court erred in failing to allow him to present evidence
regarding furnishings and artwork from The Beeches and St. Edmunds. However, husband’s
brief spends only two paragraphs arguing the issue and fails to even articulate the issue
concerning the furnishings and artwork. Rule 5A:20(e) requires appellant’s brief to contain
“principles of law, the argument, and the authorities relating to each question presented.” While
the law and authorities have been rightfully scarce throughout both briefs because of the
Agreement’s central importance to the proceedings, husband here fails to enable this Court to
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understand even what the question is regarding the furnishings and artwork on which he could
not present evidence. An argument so vague and abrupt that it fails to convey its underlying
purpose certainly fails to meet the requirement of Rule 5A:20. See Buchanan v. Buchanan, 14
Va. App. 53, 56, 415 S.E.2d 237, 239 (1992) (“Statements unsupported by argument, authority,
or citations to the record do not merit appellate consideration.”).
Inadvertent Transfer of Funds into the Pension Plan Account
The parties agree that $28,605.39 was supposed to be transferred into VBSA Account
#9089-8173 but went into the Charles Schwab Pension Plan Account, which is marital property,
instead. Uncontradicted evidence establishes that these funds derived from VBSA, making them
husband’s separate property. The only disagreement is whether this transfer resulted in a
conversion of the funds into marital property or whether the money remained husband’s separately.
The marital agreement in this case determines what constitutes marital and separate property.
Under Smith, 3 Va. App. at 513, 351 S.E.2d at 593, we review a trial court’s interpretation of a
marital agreement de novo.
The relevant portion of the marital agreement reads as follows:
Husband’s interest in Virginia Beach Surgical Associates . . . shall
be Husband’s sole and exclusive separate property.
* * * * * * *
All property which is acquired during the marriage and prior to any
separation of the parties above shall also be deemed marital
property and shall be jointly owned.
A. All marital property titled in the names of one or both parties
shall be deemed equally owned irrespective of the monetary or
nonmonetary contributions made toward the acquisition, care or
maintenance of such property by either spouse.
The money here without question was originally from VBSA, and, therefore, husband’s
separate property. Under the Agreement, property is marital if acquired during the marriage, but
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the property in question here was not acquired during the marriage. It was previously separate
property and merely came to be in the pension plan account accidentally.
“The guiding light in the construction of a contract is the intention of the parties as
expressed by them in the words they have used, and courts are bound to say that the parties
intended what the written instrument plainly declares.” Wilson v. Holyfield, 227 Va. 184, 187,
313 S.E.2d 396, 398 (1984) (quoting Meade v. Wallen, 226 Va. 465, 467, 311 S.E.2d 103, 104
(1984)).
The Agreement countenances only two ways for property to be considered marital
property. First, all of husband’s assets listed on Schedule A of the Agreement not related to
VBSA became marital property upon execution. Second, property acquired during the marriage
prior to separation is marital property regardless of the source of funds (still excluding, however,
VBSA). The Agreement provides no other avenue for marital property to exist.
Furthermore, clause A, as quoted above, does not say that property titled in the name of
either party becomes marital but only that “marital property” titled in the name of either party is
equally owned regardless of contribution. Since the money in question was not acquired during
the marriage so as to become marital property, the titling portion of the agreement does not
apply. Given the specificity of the Agreement regarding the origins of marital property and the
protection of VBSA as husband’s separate property, we cannot read the contract to state that
separate property accidentally transferred into a marital account to transmute into marital
property. Therefore, the funds accidentally transferred from the VBSA account to the pension
account remain husband’s separate funds.
Conclusion
For these reasons, we find that the trial court erred in 1) ruling that husband’s interest in
St. Edmunds was marital property; 2) finding that wife paid the £100,000 UK for the High
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Mount mortgage; 3) confusing the £100,000 UK paid toward the High Mount mortgage with the
$100,000 spousal support payment; 4) failing to allow husband to introduce evidence pertaining
to wife’s transfers of funds from marital accounts into separate accounts pre-separation; and
5) finding the separate funds accidentally transferred into a marital account to be marital.
We affirm the trial court’s 1) refusal to address the St. Edmunds rents; 2) refusal to
further reimburse husband for The Beeches’ expenses; 3) refusal to find that wife was the
beneficial purchaser of The Beeches; 4) decision to include the money held by Dean and Dean
toward husband’s share of the estate; and 5) ruling that wife did not improperly transfer marital
funds post-separation.
We decline to consider husband’s contentions concerning furnishings and artwork in The
Beeches and St. Edmunds or the trial court’s failure to enter a QDRO. The former is defaulted
for lack of argument or evidence, and the latter is not properly before us.
Therefore, the decision of the trial court is affirmed in part, reversed in part, and
remanded.
Affirmed, in part,
reversed, in part,
and remanded.
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