Baker v. Baker
| Docket Number | CV-22-186 |
| Decision Date | 01 November 2023 |
| Parties | JOHN JAMES BAKER APPELLANT/CROSS-APPELLEE v. DENISE BINNS BAKER APPELLEE/CROSS-APPELLANT |
| Court | Arkansas Court of Appeals |
APPEAL FROM THE GARLAND COUNTY CIRCUIT COURT [NO. 26DR-20-367] HONORABLE CECILIA DYER, JUDGE.
Murphy, Thompson, Arnold, Skinner & Castleberry, by Kenneth P. "Casey" Castleberry; and Schnipper Britton &Stobaugh, by: John S. Stobaugh, for appellant.
Ogles Law Firm P.A., by: John Ogles, for appellee.
John Baker and Denise Binns Baker each appeal the decree of divorce entered by the Garland County Circuit Court on September 27, 2021. On direct appeal, John argues that the circuit court erred in (1) finding that real property at 148 East Glazypeau Road was marital property; (2) finding that a five-acre tract adjoining 148 East Glazypeau Road was marital property; and (3) awarding Denise spousal support pending the parties' divorce. Denise cross-appeals, arguing that the circuit court erred in (1) ordering her to repay money she withdrew from John's nonmarital business accounts and (2) denying her request for rehabilitative alimony. We affirm on both direct appeal and cross-appeal.
John and Denise were married on October 15, 2016, and no children were born during the marriage. Denise has a daughter, MC from a previous marriage. The evidence presented at the divorce hearing showed that when the parties married in 2016 they each brought items of real and personal property into the marriage. Denise owned a home at 105 Scotch Court in Hot Springs (Scotch Court), where she lived with MC. When the parties married, John moved into Denise's home, and together they made significant improvements to the home. John had been residing at 148 East Glazypeau Road in Hot Springs (East Glazypeau), which is a home and shop where he operated Top That, LLC (Top That), a countertop fabrication business. East Glazypeau was owned by John's parents when the parties married in 2016. However, in 2017, John's parents deeded East Glazypeau to John, and John and Denise executed a mortgage with the power to sell in favor of John's parents to secure a promissory note in the amount of $100,000. Both the deed and the mortgage were filed in January 2018. John and Denise subsequently moved into the home at East Glazypeau and continued to reside there during the marriage. Also, within a year of the marriage, John and Denise purchased five acres of land (the five-acre tract) adjoining East Glazypeau using $20,000 that John's parents provided. The parties subsequently conveyed the five-acre tract to a real-estate holding company, Top That Properties, LLC (Top That Properties), that they jointly formed during the marriage.
Denise testified that she is a registered nurse. During the marriage, however, she worked for Top That helping with installs, payroll, and printing estimates. She did not draw a salary.
In March 2019, Denise discovered John's phone contained images of photographs of her daughter and niece in swimsuits. The photos had been cropped to focus on the girls' breasts and on MC's pubic area. Another photograph on John's phone showed the exposed breast of an unknown female who appeared to be a minor. Denise separated from John in March or April 2019, and John filed a complaint for divorce on July 26, 2019. However, the parties reconciled, and the divorce case was dismissed on January 28, 2020.
On September 16, 2019, while the original divorce complaint was pending, John and Denise executed a revocable trust agreement, "The John and Denise Baker Living Trust" (Trust). They were designated both settlors and co-trustees of the Trust. They placed all the real and personal property that they owned individually and jointly into the trust.
When John failed to complete counseling during the parties' reconciliation, Denise separated from him again, and she filed her complaint for divorce on May 13, 2020. John answered and filed a counterclaim, and a hearing was held on August 4, 2021, at which time the circuit court heard testimony from several witnesses, including both parties, and received multiple exhibits into evidence. After the parties submitted proposed findings of fact and conclusions of law, the circuit court entered a divorce decree.
The court first found that the terms of the Trust were clear and unambiguous, that when the parties placed their property into the Trust they were not commingling it, and that it was their intent that their nonmarital property was not converted into marital property. The circuit court then found that Scotch Court was Denise's nonmarital property and awarded it to her. The court found that East Glazypeau and the five-acre tract were marital property and ordered that the properties be sold at auction with the net proceeds of the sale to be equally divided by the parties. The court found that Top That Properties was marital property that owned no property at the time of the divorce; therefore, the court ordered that it be dissolved, with each party bearing one-half of the cost associated with dissolution. The circuit court found that Top That was John's premarital property and awarded it to him.
The circuit court next found that Denise had wrongfully taken $19,000 from two bank accounts belonging to Top That. It ordered her to return the money, but it offset the amount by $14,000, which was the amount the court awarded Denise for spousal support during the fourteenmonth divorce action. Finally, the court denied Denise's request for seven years of rehabilitative alimony. This appeal followed.
This court reviews divorce cases de novo, but it will not reverse the circuit court's findings of fact unless they are clearly erroneous or against the preponderance of the evidence. Branscum v. Branscum, 2022 Ark.App. 126, at 2, 642 S.W.3d 270, 273. A finding is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with a definite and firm conviction that a mistake has been committed. Id., 642 S.W.3d at 273. In reviewing the circuit court's findings, this court defers to the circuit court's superior position to determine the credibility of witnesses and the weight to be given their testimony and the evidence. Jez v. Jez, 2016 Ark.App. 594, at 2, 509 S.W.3d 1, 3.
Decisions about alimony and spousal support are matters within the circuit court's discretion, and this court will not reverse such decisions absent an abuse of that discretion. Middleton v. Middleton, 2020 Ark.App. 389, at 11, 609 S.W.3d 652, 660. An abuse of discretion occurs when a circuit court acts improvidently, thoughtlessly, or without due consideration. Townsend v. Townsend, 2021 Ark.App. 87, at 13. The circuit court is in the best position to determine the needs of the parties concerning an award of alimony. Id. In reviewing its decision, our role is simply to determine whether the circuit court abused its discretion; we do not substitute our judgment for that of the circuit court. Medlen v. Medlen, 2020 Ark.App. 159, at 8-9.
On direct appeal, John presents three points. The first point is that the circuit court clearly erred in finding that East Glazypeau is marital property. He contends that the property is excluded from the definition of marital property because it was a gift from his parents. John points to the fact that he is the only person listed as a grantee on the deed from his parents, the conveyance was made among family members, and no consideration was paid for the property.
Arkansas Code Annotated section 9-12-315(b) (Repl. 2015) defines marital property as all property acquired by either spouse subsequent to the marriage. However, section 9-12-315(b)(1) excludes from the definition of marital property "property acquired . . . by gift." The burden of proving that property is in fact separate property acquired by gift is on the party asserting that interest. Jez, 2016 Ark.App. 594, at 3, 509 S.W.3d at 3. Thus, John bore the burden of proving that East Glazypeau was a gift.
We hold that the circuit court did not clearly err in finding that John failed to prove that East Glazypeau was a gift to him from his parents. It is undisputed that the property was acquired subsequent to the parties' marriage. It is also undisputed that John and Denise executed a mortgage on East Glazypeau in favor of John's parents in the amount of $100,000. John asserts that no consideration was given for East Glazypeau; however, evidence presented at the hearing showed that Denise and John paid the mortgage with marital funds until February 2020 and that the mortgage was reduced to $70,000. Davis v. Jackson, 232 Ark. 953, 957, 341 S.W.2d 762, 764 (1961) (). Moreover, the legal steps the parties took to sign and execute the deed and mortgage, and then record them, provide additional support for the circuit court's finding that the conveyance was not a gift.
The court found that the only evidence that East Glazypeau was a gift to John was his own testimony, which the court found lacked credibility. The court also noted that John's parents did not appear at the hearing to testify on his behalf about their intent to "gift" the property to him. We defer to the superior position of the circuit court to determine the credibility of witnesses and the weight to be accorded their testimony. Jez, 2016 Ark.App. 594, at 2, 509 S.W.3d at 3. The burden is on the party who asserts an interest in property to establish that it is separate property not subject to division. Aldridge v. Aldridge, 28 Ark.App. 175, 177, 773 S.W.2d 103, 104 (1980). We hold that the circuit court did not clearly err in finding that John...
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