Addis v. Addis, 85-243

• Decision Date: 18 February 1986
• Docket Number: No. 85-243,85-243
• Citation: 288 Ark. 205,703 S.W.2d 852
• Parties: Tim D.L. ADDIS, Appellant, v. Elizabeth ADDIS, Appellee.
• Court: Arkansas Supreme Court

Page 852

703 S.W.2d 852

288 Ark. 205

Tim D.L. ADDIS, Appellant, v. Elizabeth ADDIS, Appellee.

No. 85-243.

Supreme Court of Arkansas.

Feb. 18, 1986.

Skinner and Heuer by Sam T. Heuer, Batesville, for appellant.

Highsmith, Gregg, Hart, Farris & Rutledge by Josephine L. Hart, Batesville, for appellee.

DUDLEY, Justice.

The basic issue in this divorce case is whether the chancellor correctly divided marital property. We modify and affirm the division of property.

Tim Addis, appellant, and Elizabeth Addis, appellee, were married in 1966. They have a 22 year old son, Dean, and two minor daughters, Timberly and Katherine. Appellant is a veterinarian employed by the United States Department of Agriculture as an inspector with a base pay of $32,858.00 per year. In June 1982, appellant and Dean formed a partnership for the purpose of operating a dairy. The chancellor awarded the appellee $8,500.00 as the sum equal to one-half of appellant's net interest in the partnership. The appellant's first argument is that this award is in the wrong amount.

Under the Uniform Partnership Act, a partner's rights in specific partnership assets are those of a tenant in partnership. Ark.Stat.Ann. § 65-125 (Repl.1980). At divorce, in determining the rights of a husband or wife to a spouse's partnership interest, a court cannot make specific awards of partnership assets. The court must determine the value of the interest in the partnership and then award the spouse an amount equal to one-half of the value of the interest, which may be enforced by a charging order on the partnership interest. Riegler v. Riegler, 243 Ark. 113, 419 S.W.2d 311 (1967).

The appellant testified that the liabilities of the partnership were $86,000.00 at the date of the trial. He testified that the assets were worth $79,000.00. An independent witness testified that the assets were worth $79,980.00. However, the independent witness did not include machinery which had an initial cost of $14,527.20, and, according to the partnership tax return, had a depreciated value of $9,210.24 at the time of the trial. In addition, his appraisal did not include permanent leasehold improvements to the land which initially cost $17,828.08, and, after a straight-line depreciation over the life of the lease, had a depreciated value of $11,121.04. In order to determine the value of all the partnership assets, we accept the $79,980.00 value assigned to the assets which were appraised by the independent appraiser, and add to this figure the depreciated value of the items not appraised. Thus, we take the appraised figure of $79,980.00, and we add $9,210.24 and $11,121.04 for total assets of $100,311.28. The difference between partnership assets of $100,311.28 and liabilities of $86,000.00 is $14,311.28. Therefore, based upon our calculations, one-half of the net interest in the partnership amounts to $7,155.64. The Chancellor awarded appellee $8,500.00 as an amount equal to one-half the value of the partnership interest. Accordingly, we modify the $8,500.00 award to $7,155.64.

Appellant next argues that the trial court erred in fixing $4,000.00 as the amount of money which appellant must pay to appellee for her interest in his retirement account. He does not contend that the retirement account is not marital property.

During the last four years of the marriage, appellant worked for the Department of Agriculture and paid seven percent (7%) of his salary into a retirement account. At the time of trial, this account would entitle appellant to withdraw $8,000.00 if his employment were terminated for any reason. Appe...