Lofton v. Lofton
| Decision Date | 07 February 2023 |
| Docket Number | 2021-CA-00035-COA |
| Parties | CURTIS DEAN LOFTON SR. APPELLANT v. SHARON RENAE LOFTON AND PENTAGON FEDERAL CREDIT UNION APPELLEES |
| Court | Mississippi Court of Appeals |
CURTIS DEAN LOFTON SR. APPELLANT
v.
SHARON RENAE LOFTON AND PENTAGON FEDERAL CREDIT UNION APPELLEES
No. 2021-CA-00035-COA
Court of Appeals of Mississippi
February 7, 2023
DATE OF JUDGMENT: 08/04/2020
LINCOLN COUNTY CHANCERY COURT HON. JAYE A. BRADLEY TRIAL JUDGE
ATTORNEYS FOR APPELLANT:
ROBERT S. ADDISON
MATTHEW THOMPSON
ATTORNEYS FOR APPELLEES:
W. BRADY KELLEMS
BETH WINDSOR BURTON
BEFORE CARLTON, P.J., SMITH AND EMFINGER, JJ.
CARLTON, P.J.
¶1. Sharon Renae Lofton (Renae) filed a complaint for divorce against her husband, Curtis Dean Lofton Sr. (Dean), in April 2018. The divorce action is pending. About a year later, Renae filed a separate lawsuit in the Lincoln County Chancery Court against her husband and the parties' adult son, Curtis Dean Lofton Jr. (Curtis), to set aside certain allegedly fraudulent transfers of real and personal property. The fraudulent-transfer lawsuit was tried before a chancellor in 2020. This appeal is from the chancery court's judgment in Renae's favor in that lawsuit.
¶2. With the exception of a homestead conveyance,[1] the chancery court found that the transfers were fraudulent under the Uniform Fraudulent Transfer Act (UFTA), Mississippi Code Annotated sections 15-3-101 to -121 (Rev. 2012), and Mississippi caselaw. The chancery court set aside these transfers and ordered that the property be held in trust until Renae and Dean's ownership interests were adjudicated in the separate divorce proceeding. The chancery court further ordered that certain payments relating to the real or personal property be paid into the registry of the Lincoln County Chancery Court. Additionally, the chancery court awarded attorney's fees to Renae.
¶3. Dean appealed, and we have consolidated his issues for clarity. Dean asserts that the chancery court erred when it (1) concluded that the UFTA supported a finding of fraud and relied on caselaw that was distinguishable from the case before it and (2) failed to undergo a McKee[2] analysis in awarding attorney's fees to Renae. Finding no abuse of discretion or manifest error, we affirm the chancery court's judgment.
FACTS AND PROCEDURAL HISTORY
¶4. Renae and Dean were married on May 26, 1996. Curtis is their son and the only child born of this marriage. The parties lived in the home located at 2507 Dalton Lane in Smithdale, Mississippi, and declared a homestead exemption on this property (the homestead
property). Dean owned the home and lived there before he married Renae.
¶5. Renae filed a complaint for divorce against Dean on April 23, 2018. On that same date, she also filed a lis pendens notice in the Lincoln County Chancery Clerk's office, listing numerous properties located in Lincoln County and attaching copies of the deeds relating to the affected properties.
¶6. On July 9, 2019, Renae initiated her fraudulent-transfer lawsuit against Dean and Curtis. She sought to set aside the quitclaim deed conveying the homestead property from Dean to Curtis, as well as ten other quitclaim deeds from Dean to Curtis that were "purportedly dated and notarized on February 9, 2018, but were not recorded until April 27, 2018." Renae also sought to set aside a document titled "Transfer of Ownership" that transferred ownership of certain personal property that included mobile homes, vehicles, guns, and farm equipment from Dean to Curtis. Like the ten quitclaim deeds, the transfer-of-ownership instrument was purportedly dated and notarized on February 9, 2018, and recorded on April 27, 2018. In her complaint, Renae also described certain payments and insurance proceeds that had been collected by Dean or Curtis relating to the land and personal property transferred to Curtis. Renae also sought reasonable attorney's fees and costs.
¶7. Renae subsequently filed an amended complaint, joining Pentagon Federal Credit Union (PenFed) as a necessary party because it was the holder of a note and deed of trust
related to the homestead property.[3]
¶8. To be clear, we reiterate that Dean does not raise any issue on appeal relating to that portion of the chancery court's judgment setting aside the homestead-property conveyance because Dean did not obtain Renae's signature on this deed (in violation of the nonwaivable statutory requirement that both spouses sign a conveyance of homestead property).[4] Rather, at issue in this appeal is the part of the chancery court's judgment that (1) sets aside the ten other quitclaim deeds and the transfer-of-ownership instrument; (2) requires certain payments to Curtis or Dean relating to this real and personal property be paid into the registry of the Lincoln County Chancery Court; and (3) awards attorney's fees to Renae.
¶9. Renae sought to consolidate the divorce case and fraudulent-transfer case. Dean
objected to consolidation. The cases were tried separately. The fraudulent transfer case was tried over five days in 2020.
¶10. Renae testified that she left Dean on April 9, 2018, and filed her complaint for divorce on April 23, 2018. She testified that she knew about the quitclaim deed conveying the marital property to Curtis, and she also understood that someday, once they (she and Dean) passed away, the other properties would pass to their children. But she did not know anything about the ten quitclaim deeds purportedly executed by Dean on February 9, 2018, that conveyed the various other Lincoln County properties to Curtis, nor did she know anything about the transfer-of-ownership instrument transferring the personal property to Curtis that Dean also purportedly executed on February 9. When she was questioned about the properties referenced in the lis pendens notice she had filed the same day as her complaint for divorce, Renae testified that she and her lawyer "froze the assets just to be careful. I didn't know [Dean] had given everything to [Curtis.]" Renae testified that it was not until after she had filed her complaint for divorce that she discovered the quitclaim deeds and the transfer-of-ownership instrument. The documents showed that they had been recorded in the Lincoln County Chancery Court's land records on April 27, 2018, four days after she filed her divorce complaint.
¶11. Renae acknowledged during cross-examination that she and Dean were having marital problems before February 2018, but she had not threatened him with a divorce lawsuit. She also testified, however, that when she told Dean she would never leave him, "he said [that]
our son would be graduating, and . . . that I could leave if I wanted to.... [Curtis] would be out of the house, I could leave if I wanted to, because I wasn't happy."
¶12. Renae's counsel offered into evidence his attorney's fees affidavit and supporting time sheets prepared pursuant to the requirements of McKee v. McKee, 418 So.2d 764 (Miss. 1982). Dean's counsel objected with respect to certain entries, and Renae's counsel responded to these objections. The chancellor court allowed the exhibit to be admitted into evidence, noting the caselaw that allows for attorney's fees in fraudulent-conveyance cases. The chancellor also told Dean's counsel that she could cross-examine Renae's counsel on his charges during Dean's case-in-chief. The record reflects that Dean's counsel did not do so.
¶13. Gary Cupit testified for Renae. He and Dean had been "real good friends." In late 2017 and early 2018, Dean made some statements to him that stuck in his mind. According to Gary, Dean "made comments that he was fixing to get rid of some of them sorry MFers, and she was included; Renae Lofton was included, and he was on a mission." Gary said that Dean told him that "he was just going to get rid of her, Renae, and give his property to the kids where she couldn't have it."
¶14. Renae called Curtis as a witness during her case-in-chief. Curtis testified that his father had prepared all the quitclaim deeds and the transfer-of-ownership instrument. Curtis confirmed that he did not pay anybody or give anything in exchange for the real and personal property that his father conveyed to him. He also testified that although property located at
2265 West Lincoln Drive was conveyed to him in one of the quitclaim deeds from his father, his father remained listed as the insured on that property, and his father paid for the insurance, as reflected in the Alfa Insurance documents admitted into evidence listing "Curtis Dean Lofton, Sr." as the insured. Curtis also testified that his father lived on the property in the shop or "man cave" adjacent to the "big house" on the property. Additionally, Curtis acknowledged that vehicles transferred to him in the "transfer of ownership" instrument remained insured by his father, which was also reflected in the Alfa insurance documents.
¶15. Curtis testified about a document dated February 9, 2018, titled "LEGAL DOCUMENTATION Statement prepared by Curtis Dean Lofton Jr." He acknowledged that his father had required that he sign it before his father would sign the quitclaim deeds to the ten properties and the transfer-of-ownership instrument. The document provides, among other things, "that at any point in time I am deemed unfit by CURTIS DEAN LOFTON SR, [Dean and Taylor Holden (Dean's daughter by another marriage)] . . . will receive their portions of the properties and assets." Matt Dees also testified at trial. He signed Curtis's statement as a witness. He admitted that he had no personal knowledge whether Renae ever saw the statement.
¶16. During his testimony, Curtis also acknowledged that his father (Dean) was the insured for a barn and certain equipment that had been transferred to Curtis and subsequently had been lost or damaged in a fire, as reflected in the Mississippi Farm Bureau Casualty Insurance Co. (MFBCIC) documents that were admitted into evidence. The record reflects
that in August 2018, Dean was compensated for the loss of the barn in the...
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