Brown v. Brown

• Decision Date: 05 December 1967
• Docket Number: No. 672,672
• Citation: 248 Md. 139,235 A.2d 706
• Parties: Edith B. BROWN v. Raymond Guynne BROWN, Jr.
• Court: Maryland Court of Appeals

Page 139

248 Md. 139

235 A.2d 706

Edith B. BROWN v. Raymond Guynne BROWN, Jr.

No. 672.

Court of Appeals of Maryland.

Dec. 5, 1967.

Stanford Hoff, Westminster (E. Austin James, Frederick, on the brief), for appellant.

No attorney for appellee.

Before HAMMOND, C. J., and MARBURY, McWILLIAMS, FINAN and SINGLEY, JJ.

McWILLIAMS, Judge.

This dreary feud began nearly 20 years ago and except for a few short periods of relative tranquility it has been pressed with seeming relish ever since. By virtue of its visit to this Court in 1952 (Brown v. Brown, 199 Md. 585, 87 A.2d 626) and again in 1954 (Brown v. Brown, 204 Md. 197, 103 A.2d 856) it now has a clear title to the status of unwelcome visitor. The present, and we hope final, skirmish arises out of an agreement made in May 1957. It recites the 'protracted separation (since 1950) between the parties,' the desire of the appellee (Brown) 'to reestablish the * * * marriage and to resume the marital relationship' and 'to provide for the security of' the appellant (Edith). In consideration of Edith's willingness 'to condone all (of his) past acts' and 'to reestablish and resume their marital relationship' Brown agreed to transfer the real estate standing in his name alone to Edith and himself as tenants by the entireties, to assign to Edith 51% of the stock of Brown's Amusements, Inc., 50% of his stock in Potomac Diner, Inc. and Park Drive Inn, Inc., to discharge all existing income tax obligations, and to allow Edith to operate and manage, jointly with himself, Brown's Amusements, Inc., he to continue to operate and manage Potomac Diner and Park Drive Inn.

The reconciliation lasted about 9 months. Hostilities were resumed in March 1958 when Edith packed up and left the marital domicile for the second time. In March 1960 she filed a bill for a divorce in Frederick County alleging adultery. From time to time testimony was taken before an examiner but the case was never concluded. Edith eventually dismissed it. In February 1963 she filed another bill for a divorce, this time alleging voluntary separation. More testimony was produced and, on 5 April 1963, the chancellor granted a divorce a vinculo but held all other matters sub curia. Twenty-eight months later there was a hearing before the court auditor. After another year went by there were two more hearings, a week apart. Seven months later the chancellor signed the order from which this appeal was taken. The opinion and order of the chancellor dealt with a number of items but we shall discuss only those which have been challenged in Edith's brief. There was no brief and no appearance for Brown.

I.

Edith's first contention arises out of Brown's failure to comply with the provision in the agreement relating to the assignment of stock in 3 corporations. The chancellor was 'of the opinion that an equity court under its divorce jurisdiction' is without authority to determine the 'ownership of shares of stock in a corporation or corporations which no longer exist and as a remedy therefor decree money damages.' Accordingly he held Edith 'must assert her claim * * * in some action other than this divorce proceeding.'

What happened in connection with the stock was certainly extraordinary. Some months after the reconciliation agreement Brown gave Edith the certificate for 74 shares of the stock of Brown's Amusements, Inc., standing in his own name. The assignment form on the reverse side had been completed, on a typewriter, to show the assignment to Edith of 51 of the shares represented by the certificate. Just before he handed over the certificate Brown struck out 51 with a pen and changed it to 50. The assignment was dated and Brown's signature was witnessed. There was testimony that the total stock issued and outstanding was 100 shares. No transfer to Edith was ever made in the corporate records and she testified Brown refused to issue a new certificate in her name. She said during the nine months they lived together he consulted her 'a couple of times' about the operation of the business. After that she was not allowed to have anything to do with its management. In 1962 a part of the business was sold to Edith's brother for $10,000. He paid Brown $4,000 in cash and gave a note for the $6,000 balance which was paid in full during the following year. Brown insisted that the corporation received this money but he was unable to point to any evidence of it in the corporation books or records. When Edith's counsel suggested that he had pocketed the money instead of depositing it in the corporation account Brown took umbrage, said he was being called a thief and declared he was 'more of a man than' counsel. Order was restored by the auditor. Later on, it developed, the rest of the business was sold to Eyler's Vending Service for $20,000, $13,000 of which was represented by a note. In December 1964 all of the assets (including the note) of Brown's Amusements, Inc. ($20,240.72) were distributed to Brown, his brother and his father. Edith received nothing.

Brown steadfastly refused to transfer to Edith 50% of his stock in Potomac Diner, Inc. He admitted, however, that he received a $70 quarterly dividend in 1962. Edith claims he received like amounts between 22 May 1957 and 9 December 1966 (the date of the decision in the court below). These dividends, she says, amounted to $2,450 and as the owner of 50 of Brown's 98 shares she is entitled to $1,225 and a stock certificate for one-half of his stock.

Brown gave Edith his certificate for 98 shares of the stock of Park Restaurant of Frederick, Inc. (Park Drive Inn, Inc. in the agreement). The form on the reverse side was filled in to indicate the assignment of 50 shares to Edith. The corporate records do not reflect such an assignment nor was a certificate ever issued to her for the 50 shares. Brown testified 'the place was tore down' and that 'there wasn't anything whatsoever left and nothing whatsoever as far as the Park Drive Inn is concerned, it is not as good as the paper it is written on.' Indeed Edith's counsel, in the brief, seems to concede that Park Drive Inn, Inc. is 'defunct.'

The chancellor felt that Brucker v. Benson, 209 Md. 247, 121 A.2d 230 (1956), is controlling. We see differences between Brucker and the case at bar which lead us to a contrary conclusion. In Brucker the wife sought a monetary decree for $3,500 as 'her share of mutual personal property.' There was no agreement between the parties such as there is here. She alleged that during the period in question she contributed toward the purchase of the personal property about $9,500 and that the husband's contribution during the same period was $11,200. Chief Judge Brune, who wrote for the Court, after quoting Code, Art. 16, § 38 (1951) (now § 29 ¹), pointed out that the wife:

'* * * does not seek by her petition as filed to establish her ownership of, or claim to, personal property, nor does she seek the sale of any such property in order that the proceeds thereof may be divided. She seeks money-not tangible property-and she seeks it in an amount which she says is equivalent to her total contributions to a matrimonial, pooled fund used to buy personal property.' Id. at 251, 121 A.2d at 232.

Judge Brune went on to note that the charging of the former husband with the full amount of her contributions to the fund which may have been applied to the purchase of personal property, regardless of the present ownership, value, or even existence, of such property would, (he said):

'* * * upon divorce, convert all of her alleged contributions towards the personal property fund into demand deposits, repayable by the husband.' Id. at 252, 121 A.2d at 233.

He noted her failure to take any depreciation into account. He adverted to the fact that her petition ignored the presumption of a gift and the impact on her claim of the interest she acquired in the jointly held real estate. He also characterized her evidence as 'both scanty and very indefinite.'

In the case before us Edith is not trying to establish her ownership of the stock. She became the undisputed equitable owner of the stock by virtue of the agreement in which it is described as her 'sole and separate property.' She is seeking not the sale but the possession of it. In paragraph 3 of the prayer for relief in the bill of complaint she asks not only for 'a division of the personal property' but also for the specific enforcement of 'the provisions of' the agreement, which was attached to the bill and filed as an exhibit.

We think the agreement, to use the language of the statute, is 'valid, binding and enforceable to every intent and purpose' in this divorce action. Code, Art. 16, § 28 ² (1966, Repl.Vol.). In Grossman v. Grossman, 234 Md. 139, 145, 198 A.2d 260 (1964), where the divorce granted below was reversed, we held that an offer of reconciliation wrongfully refused did not vitiate a prior separation agreement and that it was valid and enforceable. Speaking for the Court, Judge Marbury said:

'We have, of course, long recognized the validity of such agreements, and a statute specifically so provides.

Code (1957), Article 16, Section 28, and see generally, Myerberg, The Practical Aspects of Divorce Practice (2d ed.), Chapter VII, especially page 86.'

That relief eventually may come to Edith in the form of a money judgment against Brown does not seem to us to be sufficient reason for denying jurisdiction. After all, the situation was not of her making. It arises solely out of Brown's wrongful dispersal of the corporate assets and his failure to comply with the obligation he assumed in the agreement.

Edith is clearly entitled to receive from Brown a certificate for one-half of his stock in Potomac Diner, Inc. She is entitled also to one-half of whatever dividends he may have received between 22 May 1957 and 9 December 1966. The chancellor, in his opinion, said 'Potomac Diner, Inc., was sold, no sale date being given in the testimony.' If...