Hattaway v. Coulter

• Decision Date: 17 December 2021
• Docket Number: 2200502
• Parties: Terrell Hattaway v. Valerie Kathy Coulter
• Court: Alabama Court of Civil Appeals

Terrell Hattaway v. Valerie Kathy Coulter

No. 2200502

Alabama Court of Civil Appeals

December 17, 2021

Appeal from Baldwin Circuit Court (CV-20-900339)

THOMPSON, PRESIDING JUDGE.

Terrell Hattaway appeals the judgment of the Baldwin Circuit Court ("the trial court") in favor of Valerie Kathy Coulter on Hattaway's unjust- enrichment claim arising from Coulter's retention of an engagement ring. We reverse and remand with instructions.

Hattaway and Coulter were involved in a romantic relationship for several years, and, during the latter part of the relationship, Hattaway and Coulter had cohabited. Throughout the relationship, Hattaway gave Coulter numerous gifts including a diamond tennis bracelet valued at $10, 000. Hattaway testified that those gifts were unconditional gifts and that he had had no expectation of their return if his relationship with Coulter ended.

On December 24, 2018, Hattaway presented Coulter with a Christmas gift bag. Coulter stated that, when Hattaway handed her the bag, she knew that "it was going to be something big" because he pulled out his telephone and started making a video recording.^[1] Inside the gift bag was a Christmas ornament with a two and one-half carat diamond ring, valued at $32, 000, ^[2] attached to it. According to Hattaway when Coulter pulled out the ornament from the gift bag, he dropped to one knee and asked Coulter to marry him. Hattaway testified that, when she responded affirmatively to his proposal of marriage, he placed the ring on her finger. Coulter disagreed, testifying that Hattaway did not propose marriage to her when she opened the gift and never informed others that they were engaged. She did state, however, that when she received the gift she "assumed" that the ring was an engagement ring. Hattaway testified that when he gave Coulter the ring he did not explicitly state that he expected her to return the ring if she did not marry him.

According to Hattaway, he and Coulter discussed a wedding date for several months and participated in counseling to work on their relationship but could not agree on a wedding date. Coulter testified that Hattaway refused to discuss a wedding date. In September 2019, the relationship ended when Coulter moved out of their shared home and into a home that she had purchased. Hattaway testified that he did not immediately ask Coulter to return the ring but that, later, he inquired about the ring via text messages and then, through a letter from his attorney, dated November 18, 2019, asked Coulter to return the ring.

Coulter refused to return the ring, informing Hattaway and his attorney that she had thrown the ring into the Intracoastal Waterway. At trial, Coulter testified that she had been untruthful to Hattaway and his attorney about having thrown the ring into the water. According to Coulter, she created that fabrication because, she said, Hattaway was using the return of one of her family heirlooms to negotiate the return of the ring. Coulter admitted that, even though she had not returned the ring, Hattaway had returned her family heirloom. Coulter testified that, although she knew the ring was valued at $32, 000, she sold the ring to an individual for $10, 000 sometime in 2020 after she had lost her employment due to the COVID-19 pandemic and needed funds.

On March 12, 2020, Hattaway filed a complaint against Coulter, alleging claims of conversion and intentional infliction of emotional distress. On August 19, 2020, Hattaway amended the complaint to include a claim alleging unjust enrichment. With regard to that claim, Hattaway alleged:

"[Coulter] knew that the $32, 000 engagement ring was a gift conditioned on marrying [Hattaway] inasmuch that it was proffered with the proposal of marriage, and that only if [Coulter] agreed to marry [Hattaway] would she be entitled to receive the ring as a gift, pending the future marriage. Such tradition is so common place and customary in our society that [Hattaway] respectfully requests that the court take judicial notice of that concept.

"By requesting a copy of the ring's appraisal shortly before parting ways with [Hattaway], [Coulter] further demonstrated an intent to profit from the ring after breaking off the ... engagement.

"A plaintiff can recover on an unjust enrichment claim if he can prove that 'the defendant holds money which, in equity and good conscience, belongs to the plaintiff or holds money which was improperly paid to defendant because of mistake or fraud.' Mantiply v. Mantiply, 951 So.2d 638, [654] (Ala. 2006).

"By virtue of the conscious wrongdoing alleged above, [Coulter] has been unjustly enriched at the expense of [Hattaway, ] who is entitled in equity, and hereby seeks, the disgorgement and restitution of [Coulter's] wrongful profits to the extent and in the amount deemed appropriate by the court; and such other relief as the court deems just and proper to remedy [Coulter's] unjust enrichment."

Hattaway specifically requested that the trial court enter a judgment against Hattaway in the amount of $32, 000, plus interest, costs, punitive damages, and a reasonable attorney fee.

On August 20, 2020, Coulter filed a motion to dismiss, arguing that Hattaway's conversion claim should be dismissed because, she said, an engagement ring is a gift and, therefore, Hattaway could not prove that she had exercised dominion and control over his property.^[3] She further argued that Hattaway's intentional- infliction-of-emotional-distress claim should be dismissed because that claim rested upon Hattaway's emotional hurt caused by the ending of the romantic relationship and/or his anger over the fact that Coulter did not return the engagement ring to him. Coulter maintained that "[s]uch is improper as a civil cause of action." With regard to Hattaway's unjust-enrichment claim, Coulter maintained: "The engagement ring at issue in this case was a gift from [Hattaway] to [Coulter]. The claim of unjust enrichment does not apply to a gift as an engagement ring."

On November 2, 2020, after considering Coulter's motion to dismiss, the trial court dismissed Hattaway's claims of conversion and intentional infliction of emotional distress.^[4] On January 20, 2021, the trial court conducted a bench trial on the remaining unjust-enrichment claim. On January 21, 2021, the trial court entered a judgment, providing in pertinent part:

"[Hattaway] proposed marriage on Christmas Eve in 2018. [Hattaway] presented [Coulter] with an engagement ring, which [Coulter] accepted. The parties never set a wedding date, [Hattaway] never expressly or orally put any conditions on the acceptance of the ring, they never discussed the ring, and eventually [Coulter] called off the wedding/engagement/relationship some time in 2019. [Coulter] didn't ask for the ring back, until several months after the breakup, ^[5] and only upon consulting an attorney. Finally, [Coulter] refused to return the ring.

"[Hattaway's] burden for proving unjust enrichment is met if he shows the fact finder, 'the defendant[, Coulter, ] holds money [or the ring] which, in equity and good conscience, belongs to the plaintiff[, Hattaway, ] or holds money [or the ring] which was improperly paid to defendant[, Coulter, ] because of mistake or fraud.' Mantiply v. Mantiply, 951 So.2d 638, [654] (Ala. 2006).

"[Hattaway] wrapped the engagement ring into a Christmas present attached to a Christmas ornament, gave it to [Coulter, ] and put no conditions on that 'gift.' Clearly, [Hattaway] has failed to prove unjust enrichment.

"The Court notes that [Coulter] has an outright moral obligation to return the engagement ring. The fact that she testified that she sold a $32, 000 ring for $10, 000 because she was struggling during the pandemic, and that in some manner [that] justifies her keeping the ring is telling to the Court as to her moral compass.

"That said, this Court does not sit as a court of morality, and the Court must follow current precedent, as set forth by the Alabama Appellate Courts.

"The Court finds in favor of [Coulter] and against [Hattaway]. Each party to bear their own costs."

On January 22, 2021, the trial court entered an amended judgment to correct a clerical error in the January 21, 2021, judgment. On February 21, 2021, Hattaway filed a timely postjudgment motion.^[6] In his motion, Hattaway argued that Alabama law has not addressed whether, as a matter of law, an engagement ring is a conditional gift, that the evidence supported a finding that Hattaway's presentation of the engagement ring with a proposal of marriage established that the ring was a gift conditioned on marriage, that Coulter had been untruthful about throwing the ring in the Intracoastal Waterway, that Coulter had known the value of the ring and had sold the ring for one-third of its value, and that Hattaway had conditioned the acceptance of the ring on marriage. Hattaway maintained that the evidence established all the elements necessary to prove unjust enrichment because it established that Coulter "knowingly sold a conditional gift to which she failed to meet its condition [and] ... was unjustly enriched in that she fraudulently sold a ring which she was not entitled to hold," and Hattaway requested that the trial court vacate its judgment and enter a judgment in favor of Hattaway in the amount of $32, 000. On March 3, 2021, the trial court denied Hattaway's postjudgment motion, and on April 13, 2021, Hattaway filed his notice of appeal.

The standard of review for this case is well established. Because the trial court conducted a bench trial and heard ore tenus evidence, this court presumes that the trial court's findings on disputed facts are correct and will not reverse the judgment based on those findings unless the judgment is palpably erroneous...