Grogan v. Grogan, 92-CA-00331

• Decision Date: 09 June 1994
• Docket Number: No. 92-CA-00331,92-CA-00331
• Citation: 641 So.2d 734
• Parties: Ronald E. GROGAN, v. Carolyn Tate GROGAN.
• Court: Mississippi Supreme Court

Page 734

641 So.2d 734

Ronald E. GROGAN, v. Carolyn Tate GROGAN.

No. 92-CA-00331.

Supreme Court of Mississippi.

June 9, 1994.

Rehearing Denied Sept. 15, 1994.

Ross R. Barnett, Jr., Barnett Law Firm, Thomas J. Lowe, Jr., Jackson, for appellant.

Richard C. Roberts, III, Jackson, for appellee.

EN BANC.

PRATHER, Presiding Justice, for the Court:

I. INTRODUCTION.

This case is appealed from the Chancery Court of Hinds County, First Judicial District. Following a two-day trial on January 14-15, 1992, the chancellor awarded Carolyn Tate Grogan a divorce from her husband, Ronald E. Grogan, on the ground of uncondoned adultery. A final judgment in this case was entered on February 5, 1992. Among other things, this final judgment required Ronald to pay to Carolyn $600 per month in child support ($300 per child), $25,020 lump sum alimony (payable in sixty $417 monthly payments), and also awarded Carolyn partial attorney's fees in the amount of $15,000. From this ruling, Ronald appeals to this Court assigning as error the following:

I. WHETHER OR NOT THE CHANCELLOR ABUSED HER DISCRETION AND COMMITTED MANIFEST ERROR IN THE DETERMINATION IN THE AMOUNT OF THE AWARD OF CHILD SUPPORT.

II. WHETHER OR NOT THE CHANCELLOR ABUSED HER DISCRETION AND COMMITTED MANIFEST ERROR IN THE AWARDING AND DETERMINATION IN THE AMOUNT OF THE AWARD OF ALIMONY.

III. WHETHER OR NOT THE CHANCELLOR ABUSED HER DISCRETION AND COMMITTED MANIFEST ERROR IN AWARDING AND THE DETERMINATION OF THE AMOUNT OF THE AWARD OF ATTORNEY'S FEES.

II. STATEMENT OF THE FACTS.

Ronald E. Grogan and Carolyn Tate Grogan were married on August 6, 1973. Ronald and Carolyn had two children, Ronald Wade Grogan and Heather A. Grogan, who were ages 17 and 9 respectively at the time of the trial.

After they were married, when she was 20, Carolyn went to work for Audubon Insurance Company. At Audubon, she began as a receptionist, but later worked in the company's commercial underwriting department. Carolyn worked there for five and one half years.

In 1982, Ronald bought a commercial charter bus operation, Deep South Buses, from his father. Carolyn quit her job at the insurance company and went to work for Ronald full time at Deep South where she did not make a salary. In 1984, Ronald bought a travel agency called American Adventure Travel, which dealt with charter bus tours and individual travel arraignments. After about six months Carolyn went to work at American Adventure Travel on a full time basis. Carolyn worked there eight hours a day, five days a week and drew no salary for her work. Ronald and Carolyn would take a draw out of the company and would then deposit this in their joint checking account. Carolyn testified that this draw averaged about $4,000 per month. With the amount drawn on the company and deposited in their joint checking account, Carolyn would pay their bills. However, only home expenses such as the house note, utilities, groceries, and school notes were paid out of this joint checking account. Other expenses, including car notes, car insurance, car tags, and fuel, were paid each month by the company. Also, the company paid the premium for the family's health, medical, and cancer insurance policies. Carolyn has only a high school education, and she testified that her only work skills are those that she developed while working in the travel industry.

Ronald was the sole shareholder and also the president of American Adventure Travel. While Carolyn did not own any stock in American Adventure Travel, she did serve as the company's secretary and treasurer. In her capacity as secretary and treasurer, Carolyn signed documents as an officer of American Adventure Travel, and also signed continuing guarantees of indebtedness of the corporation. In addition to serving as secretary and treasurer, Carolyn made several other significant contributions to American Adventure Travel. When Ronald and Carolyn sold their home, Carolyn deposited her half of their home equity ($6,000) into American Adventure Travel's account. Carolyn took a $4,000 cash advance on her personal Visa Classic Account and deposited this in the company's account. Also, at Ronald's request, Carolyn purchased a computer for American Adventure Travel from Office Depot on her Citibank Visa charge card. ¹

While the family did live a "comfortable" lifestyle, the company did on occasion experience a cash flow problem. To help relieve this situation Ronald requested that Carolyn ask her parents about possibly lending them some money. Carolyn did, and her father, J.N. Tate, agreed to lend them $20,000. To get this money, Mr. Tate took out a home equity loan for which he had already been approved. Mr. Tate gave the money to Carolyn in cash and she deposited it into American Adventure Travel's account. The amount of repayment on this loan was $418 per month. Ronald would authorize a check from the company for that amount in Carolyn's name. Carolyn would deposit this check into their joint checking account and would then write her parents a check from this account. ²

Ronald and Carolyn separated on November 6, 1990, when Ronald left home. Ronald said that he needed some time alone and that it was not Carolyn's fault. Carolyn testified that after Ronald left home, she tried to get him to return, but with no success. After the separation, Carolyn continued to work with Ronald at American Adventure Travel until December 1990. She left because of the strain between her and Ronald and because she said that Ronald asked her to leave. Ronald then got Carolyn a job at Cline Tours. She worked there on a commission basis, where she would get one half of all that she sold, with the owner getting the other half. Carolyn testified that when she told Ronald that she and the children could not live off of the commission that she would make at Cline Tours, Ronald told her not to worry and that he would take care of them. Following the separation, Ronald began paying himself a salary of $3,000 per month at American Adventure Travel. His take-home pay was approximately $2,200.

In April of 1991, Ronald admitted to Carolyn that he was having an affair with Angela Jones. Carolyn testified that after she learned of this affair, Ronald told her that he would give her $1,000 per month to support her and the children. Carolyn filed suit for separate maintenance, child custody, and support on May 28, 1991, because she stated the $1,000 from Ronald and her commissions from Cline Tours of approximately $650 per month were inadequate to support her and the children. In his answer to this complaint, Ronald counterclaimed for divorce on the grounds of cruel and inhuman treatment and irreconcilable differences.

On June 11, 1991, a hearing was held on Carolyn's Request for Temporary Relief. Among other things, this Temporary Order, entered on June 24, 1991, awarded custody of the children to Carolyn, required Ronald to pay to Carolyn $750 per month in child support ($375 per child), and $750 separate maintenance. Also, Ronald had to make payments to Mr. J.N. Tate, Carolyn's father, of $418 in repayment of the loan, provided that Ronald was able to do so.

After this temporary order, on July 1, 1991, Ronald transferred the assets of American Adventure Travel into Grogan Coaches, Inc., a corporation formed by Ronald. Carolyn then made a Motion for Citation for Contempt. A hearing was held on this motion on July, 29, 1991. At this hearing the chancellor found Ronald to be in contempt in the amount of $1,363 in that he had the ability to pay, but had failed to do so. The chancellor also awarded Carolyn $400 in attorney's fees. Ronald was ordered into the custody of the Hinds County Sheriff's Department until he purged himself of this contempt. However, the incarceration was stayed until July 31, 1991, in order to give Ronald time to raise this money.

On the day following the contempt hearing, July 30, 1991, Ronald sold his two corporations, American Adventure Travel and Grogan Coaches ³ to his brother Chris Grogan for a total of $3,000. ⁴ Ronald testified at a later hearing that he sold his corporations because he was about to go to jail as a result of his inability to pay the contempt judgment and that he did so with no malice toward Carolyn or his children. Ronald also testified that Carolyn had made threats to him to the effect that before she was through with him, both he and his corporations would be broke. There is also a considerable amount of dispute as to whether Carolyn was offered the opportunity to buy the companies. Ronald testified that he offered to give the companies to Carolyn and that she refused to take them. While Carolyn admits that Ronald did make this offer, she claims that this was not a legitimate offer because it was made in a "flipped way" and was made during the course of a heated argument.

Chris testified at trial that he bought the corporations only to keep his job and to help support his family. He did not buy the corporations with the intention to either help his brother, Ronald, or to hurt Carolyn. When he made this purchase, Chris did not know what the companies' assets or liabilities were nor did he review any financial statements. Chris did admit that Ronald told him about Carolyn's credit card cash advance and her purchase of the computer, and that the corporations should be responsible for those amounts. Chris also testified that even after the sale, the corporations have continued to pay some of Ronald's debts. These included a $430.48 per month note to George Fisher for Ronald's purchase of P & G Charter and a number of other expenses.

This sale of the corporations to Chris Grogan took place the night before a Temporary Restraining Order went into effect. This TRO, which went into effect at 11:30 a.m. on July 31, 1991, prevented Ronald E. Grogan, and those persons in active concert with him from taking any action whatsoever to sell, transfer or convey, or otherwise dispose of or liquidate...