Graves v. Graves, WD

• Decision Date: 31 March 1998
• Docket Number: No. WD,WD
• Citation: 967 S.W.2d 632
• Parties: Teri Lee GRAVES, Respondent, v. Gary Michael GRAVES, Appellant. 54248.
• Court: Missouri Court of Appeals

Page 632

967 S.W.2d 632

Teri Lee GRAVES, Respondent, v. Gary Michael GRAVES, Appellant.

No. WD 54248.

Missouri Court of Appeals Western District.

March 31, 1998.

Motion for Rehearing and/or Transfer to

Supreme Court Denied June 2, 1998.

John R. Shank, Jr., Gunn, Shank & Stover, P.C., Kansas City, for appellant.

Thomas E. Hankins, Gladstone, for respondent

Before LAURA DENVIR STITH, P.J., and HANNA and RIEDERER, JJ.

LAURA DENVIR STITH, Presiding Judge.

Gary Graves appeals the trial court's order dissolving his marriage to Teri Lee Graves. First, he claims that the trial court erred in ordering him and Graves Machinery, L.L.C. to execute a lease of property awarded to Mrs. Graves in the property distribution. He also asserts that the trial court erred in retaining jurisdiction over the issue of maintenance, in granting primary physical custody of the couple's children to Mrs. Graves, and in calculating his child support obligation. Mr. Graves also claims that the trial court erred in ordering him to pay Mrs. Graves' attorneys' fees and expert witnesses' fees. Finally, he argues that the trial court's order granting Mrs. Graves maintenance and attorneys' fees pending appeal was void.

We find that the trial court erred in its calculation of child support, and therefore remand for the trial court to correctly compute Mr. Graves' child support obligation. We also remand with directions for the trial court to order Mr. Graves to pay the lesser amount for Mrs. Graves' attorneys' fees and expert witnesses' fees stated in the judge's findings of fact. We affirm the judgment on Mr. Graves' remaining points on appeal.

I. FACTUAL AND PROCEDURAL BACKGROUND

Teri Lee Graves and Gary Michael Graves were married on November 2, 1979. They had three children together: Wesley Alan Graves, born on July 18, 1981, Emily Nicole Graves, born on December 18, 1984, and Laura Elizabeth Graves, born on January 5, 1988. The couple owned a limited liability company called Graves Machinery, L.L.C., which rented and sold heavy construction equipment. Graves Machinery, L.L.C. operated on a tract of land in North Kansas City, which it leased from the Graves.

After more than fifteen years of marriage, the couple separated in March 1996. Since the separation, the children have continued to live with Mrs. Graves. On August 28, 1996, Mrs. Graves filed a Petition for Dissolution of Marriage in Clay County, Missouri. At that time, the children were fifteen, eleven, and eight years old, respectively.

On March 10, 1997, the trial court entered a judgment dissolving the Graves' marriage. Among other items of marital property distributed, the court awarded Mr. Graves all right, title, and interest in Graves Machinery, L.L.C. The court awarded Mrs. Graves the real estate in North Kansas City on which Graves Machinery, L.L.C. operated. The court also ordered the couple to sign a twelve month lease, under which Mr. Graves leased the Graves Machinery premises in North Kansas City from Mrs. Graves for a monthly rent of $9,500. The trial court awarded Mr. and Mrs. Graves joint legal custody of their three children, with Mrs. Graves having primary physical custody. The court also ordered Mr. Graves to pay Mrs. Graves $2,422 per month for child support. Finally, the trial court ordered Mr. Graves to pay a portion of Mrs. Graves' attorneys' fees and expert witnesses' fees. This appeal followed.

II. STANDARD OF REVIEW

An appellate court reviews a decree of dissolution of marriage the same as other court-tried cases and will affirm unless the trial court erroneously declared or applied the law, unless no substantial evidence supported the judgment, or unless the judgment was against the weight of the evidence. Bullard v. Bullard, 929 S.W.2d 942, 944 (Mo.App.1996); Groh v. Groh, 910 S.W.2d 747, 749 (Mo.App.1995). The court views the evidence and all favorable inferences in the light most favorable to the party prevailing. Groh, 910 S.W.2d at 749.

III. ORDER TO EXECUTE LEASE

As previously noted, the trial court awarded Mr. Graves the couple's marital interest in Graves Machinery, L.L.C., making him the only member of the company, and awarded Mrs. Graves the real estate in North Kansas City which the company had been leasing and upon which the company operated. In his first point on appeal, Mr. Graves claims that the trial court erred in ordering him and Graves Machinery, L.L.C. to execute a twelve-month lease of the property awarded to Mrs. Graves in the property distribution for a monthly rent of $9,500. Although the trial court's judgment only ordered Mr. and Mrs. Graves to sign the lease prepared by the court, the lease itself listed Graves Machinery, L.L.C. as a lessee and included a signature line for Graves Machinery, L.L.C. to be signed by Mr. Graves as President.

Mr. Graves argues that the court did not have jurisdiction to divide property or exercise control over property that is legally owned by Graves Machinery, L.L.C. It is true that, in a dissolution decree, a court may not exercise control over property belonging to a corporation, even if one of the spouses is the sole shareholder of that corporation. Levesque v. Levesque, 773 S.W.2d 220, 222 (Mo.App.1989); Penn v. Penn, 655 S.W.2d 631, 632 (Mo.App.1983). The reason for this rule is that the shareholder does not have legal title to the property; title remains in the corporation. Levesque, 773 S.W.2d at 222; Penn, 655 S.W.2d at 632. Similarly, a member of a limited liability company does not have any interest in property owned by the company; rather, the property belongs to the company itself. § 347.061.1, RSMo 1994.

Where one spouse is the sole shareholder of a corporation, however, the court may order that spouse to cause the corporation to undertake certain acts, including the transfer of property. Mehra v. Mehra, 819 S.W.2d 351 (Mo. banc 1991). In Mehra, the couple owned a professional corporation known as Southside Medical Group, P.C. The corporation owned two insurance policies on the life of Mr. Mehra. Upon dissolution of the parties' marriage, the trial court awarded Mr. Mehra all shares in the corporation. The court then ordered Mr. Mehra "as sole shareholder of [Southside Medical Group, P.C. to] cause [the] corporation to transfer" the insurance policies to Mrs. Mehra. Id. at 356. On appeal, the Missouri Supreme Court distinguished previous cases holding that the dissolution court could not divide property belonging to a corporation, stating:

These cases may be distinguished, however, on the basis that here the trial court did not allocate the corporate assets themselves as marital property, but directed husband, as sole shareholder under the court's decree, to cause the corporation to transfer the two insurance policies on his life to Rachna Mehra. Husband makes no showing this cannot be accomplished, and we conclude the trial court did not misapply the law in this regard.

Id. (footnote and citation omitted).

Similarly, here, the trial court did not attempt to distribute any property belonging to Graves Machinery, L.L.C., did not order any property belonging to the limited liability company to be turned over to Mrs. Graves, and did not directly order Graves Machinery, L.L.C. to sign the lease. Instead, the court ordered Mr. Graves to enter into a lease contract with Mrs. Graves, which was prepared and attached by the court to the dissolution decree. Just as the husband in Mehra was the sole corporate shareholder after the court awarded the couple's shares to him, so Mr. Graves was the sole member of the limited liability company after the court awarded the couple's interest to him. Under Mehra, the court therefore was within its authority in ordering Mr. Graves to cause the company to lease the property from Mrs. Graves.

While the court did not order Graves Machinery to sign the lease or to turn over any property to Mrs. Graves, it did put a signature line for Graves Machinery, to be signed by Mr. Graves as President, on the lease agreement which it attached to its order. As noted, we agree with Mr. Graves that to the extent the order and attached lease could be interpreted to be an order by the court to the company itself to sign the lease, the court was without authority to so order. We do not take the mere presence of the signature line on the lease to constitute an attempt by the court to exercise jurisdiction over the company itself, however, but rather simply as a recognition that Mr. Graves as President could commit the company to the lease and indeed would be the one who would sign on behalf of the company.

IV. EXPERT WITNESS FEES

In Mr. Graves' second point on appeal, he argues that the trial court erred in ordering him to pay Mrs. Graves' expert witnesses' fees. At the hearing on the dissolution petition, Mrs. Graves presented the testimony of various expert witnesses. James Rosenbloom testified as to the value of Graves Machinery, L.L.C.; Al Engelstadt, of Ritchie Brothers Auctioneers, testified as to the value of the machinery owned by Graves Machinery, L.L.C.; and Noble Johnson a real estate appraiser, testified as to the value of the commercial property located in North Kansas City. The trial court found that Mr. Graves should pay $9,750 toward the payment of Mr. Rosenbloom's fees, $3,000 toward the payment of the fees of Ritchie Brothers Auctioneers, and $250 toward the payment of Mr. Johnson's fees.

Section 452.355 authorizes the trial court to order a party in a dissolution proceeding to pay a reasonable amount of the other party's expert witness fees. Faintich v. Faintich, 861 S.W.2d 217, 220 (Mo.App.1993). Section 452.355 states:

The court from time to time after considering all relevant factors including the financial resources of both parties may order a party to pay a reasonable amount for the cost to the other party of maintaining or defending any proceeding under sections 452.300 to 452.415 and for attorney's fees, including sums for legal...