McGahey v. Wilson
| Decision Date | 17 July 2001 |
| Docket Number | 00-01931 |
| Parties | CONNIE L. McGAHEY v. JAMES M. WILSONIN THE COURT OF APPEALS OF TENNESSEE AT NASHVILLE |
| Court | Tennessee Court of Appeals |
Appeal from the Chancery Court for Davidson County, No. 99-2652-II
Carol McCoy, Chancellor
Upon divorce, the parties entered into an agreement that provided the parties would retain ownership as the marital residence as tenants in common, but could not sell the property without mutual consent. Mrs. McGahey now desires to partition the property over her former husband's objection. The special master found that the contract provision barring partition was unenforceable. The chancellor found the provision enforceable but only for a reasonable period of time (sixteen years). Mr. Wilson now appeals the trial court's judgment ordering partition by sale. Resolution of this appeal requires us to examine the effect of a contract barring partition between tenants in common when no time limitation or purpose for the restriction against sale was stated in the agreement. We hold the contract provision to be unenforceable.
Tenn. R. App. P. 3 Appeal as of Right ; Judgment of the Chancery Court
Affirmed as Modified
William B. Cain, J., delivered the opinion of the court, in which William C. Koch, Jr. and Patricia J. Cottrell, JJ., joined.
G. Dennis Jinkerson, Goodlettsville, Tennessee, for the appellant, James M. Wilson.
H. E. Miller, Jr., Gallatin, Tennessee, for the appellee, Connie L. McGahey.
The parties purchased approximately three acres of land together in 1975 and built a residence on it during their marriage. In 1984, the parties were divorced and entered into a Property Settlement Agreement which was incorporated in the final divorce decree. In the Property Settlement Agreement, the parties agreed to retain ownership of the property and residence as tenants in common. The pertinent portion of the parties' agreement provided:
The parties have agreed to retain joint ownership of said property as tenants in common after the granting of the divorce contemplated herein, with Wife to have sole right of possession until her remarriage, at which time possession of the property shall revert to the Husband. The party in possession shall be the party responsible for the mortgage indebtedness, taxes, insurance, and maintenance on said property and shall indemnify and hold the other party harmless for same while he or she reside in said property. The parties further agree that the property cannot be sold unless agreed to by both parties hereto. Should the property be sold, the proceeds derived therefrom shall be divided equally between the parties. Both parties further agree not to encumber their one-half interest in the property at any time without the prior written consent of the other party.
After the divorce, Mrs. McGahey lived in the house with the three children of the parties from 1984 through 1993. In 1993, Mr. Wilson took possession of the house.
On September 17, 1999, Mrs. McGahey filed a complaint pursuant to Tenn. Code Ann. 25-27-101 seeking a partition by sale of the property. The trial court referred the case to a Special Master over the defendant's objection.
The Special Master filed her Report of the Master finding in pertinent part as follows:
Answer:The Master finds and recommends to the Court that the 1984 Property Settlement Agreement between the parties is contractual in nature. The agreement to divide possession of the marital home retains its contractual status, despite being incorporated into the circuit court's order. This is the case because the court does not have continuing statutory power to modify the terms of ownership and possession of the real property upon a change of circumstances. Penland v. Penland, 521 S.W.2d 222 (Tenn. 1975).
In the face of a lawsuit to partition the property however, the settlement agreement provision regarding possession is unenforceable. It illegally restrains the free alienation of property and is therefore against public policy.
Although there is no Tennessee case directly on point, the Tennessee Supreme Court has adopted the ". . . time-honored rule that the law favors the free and untrammeled use of property, and that restrictions in conveyances on the fee are always regarded unfavorably." Central Drugstore v. Adams, et al, 201 S.W.2d 682 (Tenn. 1947). See also, Wade R. Habeeb, Annotation, Contractual Provisions as Affecting Right to Judicial Partition, 37 A.L.R. 3d 962 (1971). A study of the cases collected in the Annotation reflect the majority view that enforceable restrictions upon the right to partition must be limited in time or have an implied time limitation. See, e.v., Raisch v. Schuster, 352 N.E.2d 657 (Ohio App. 1975). The facts in the case before this court reflect an agreement in which the restriction upon partition is in perpetuity: ". . . The parties further agree that the property cannot be sold unless agreed to by both parties hereto . . ." The Master finds that such perpetual restriction against partition is against the rule adopted in this state and the majority rule elsewhere, and is unenforceable.
Finally, the Master finds and recommends that the property be sold for partition as it cannot be partitioned in kind.
Mr. Wilson objected to the Master's finding.
Mrs. McGahey filed a Motion to Confirm Report of the Master and Response to Objections to Master's Report.
On May 17, 2000, the chancellor entered an Order Granting Plaintiff's Motion to Confirm Report of the Master and Defendant's Objections in Part stating:
After hearing argument of counsel and after having reviewed the entire record, the Court has concluded that the Plaintiff's Motion should be granted and that the Defendant should be granted relief in regard to one of his Objections.
. . . .
The Master found that this provision was unenforceable. The Court has determined that such a bar may be enforced for a reasonable period of time. The Court has determined that the parties did anticipate that the property would be sold at some point in time. The parties were divorced in 1984. The Plaintiff resided on the property for approximately nine years pursuant to the provisions of the Property Settlement Agreement, and the Defendant has resided on the property for approximately seven years. A life tenancy was not anticipated by the parties, as the Defendant only has the right to possess the property. Approximately sixteen years has passed since the parties were divorced. The Court finds that sixteen years constitutes a reasonable time. As a reasonable period of time has passed, the Court finds that the property may now be partitioned and that the partition should be by auction sale.
This appeal follows.
Mr. Wilson argues that the portion of the Property Settlement Agreement stating that the "property cannot be sold unless agreed to by both parties hereto" constitutes a bar to partition and that the agreement is enforceable based upon a logically implied reasonable period of time other than sixteen years.
This hearing is on appeal from the findings of the Chancellor and the Special Master. A trial court's referral of certain matters to a Special Master can affect the standard of review on appeal. "A concurrent finding of fact by a Master and a trial court is conclusive on appeal, except where it is upon an issue not properly to be referred, where it is based on an error of law or a mixed question of fact and law, or where it is not supported by any material evidence." Mandrell v. McBee, No. M2000-00108-COA-R3-CV, 2000 WL 1753070 at * 5 (Nov. 30, 2000 Tenn.Ct.App.); Long v. Long, 957 S.W.2d 825, 828 (Tenn.Ct.App. 1997); Aussenberg v. Kramer, 944 S.W.2d 367, 370 (Tenn.Ct.App. 1996); Archer v. Archer, 907 S.W.2d 412, 415 (Tenn.Ct.App. 1995).
There is no presumption of correctness with the trial court's conclusions of law. Campbell v. Florida Steel Corp., 919 S.W.2d 26 (Tenn. 1996).
The central issue on appeal is the review of the Chancellor's conclusion of law with regard to the enforceability of the property agreement.
In this case, Mr. Wilson asks us to review the trial court's finding of law which is contrary to that of the Special Master's finding of law. Thus, we review de novo with no presumption of correctness.
The significant issue on appeal is whether the partition can be had against the will of one of the tenants in common, Mr. Wilson.
Tennessee Code Annotated section 29-27-101 provides:
Any person having an estate of inheritance, or for life, or for years, in lands, and holding or being in possession thereof, as tenant in common or otherwise, with others, is entitled to partition thereof, or sale for partition, under the provisions of this chapter.
Generally, a tenant in common, is entitled to partition, or sale for partition. Yates v. Yates, 571 S.W.2d 293 (Tenn. 1978); Tenn. Code Ann. § 29-27-101. From the plain language of the statute, it appears that a tenant in common has a right to withdraw from a co-tenancy at any time for whatever reason fostering the principal of free alienability of property, although, generally, this right is not absolute where the parties have contracted otherwise.
"It is the policy of the law to give each person his own severalty and not to force him to continue in partnership with another." Nicely v. Nicely, 41 Tenn. App. 179, 293 S.W.2d 30, 32 (1956); see also Bunch v. Bunch, No. 02A01-9705-CH-00106, 1998 WL 46217 at * 3 (Jan. 8, 1998 Tenn.Ct.App.).
"Partition will not be granted in violation of an express or implied agreement not to partition the property where the agreement covers only a reasonable period of time and is otherwise valid, binding, and effective." 68 C.J.S. Partition § 26 (1998). "Courts of other states have denied partition in cases where a co-tenant has entered into an agreement not to partition." Bunch at * 3. (citing Wade R. Habeeb, Annotation, Contractual Provisions as Affecting Right to Judicial Partition, 37 A.L.R.3d 962 (1971...
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