Morrow v. Morrow, No. M2003-02448-COA-R3-CV (TN 7/14/2005)
| Decision Date | 14 July 2005 |
| Docket Number | No. M2003-02448-COA-R3-CV.,M2003-02448-COA-R3-CV. |
| Parties | GORDON E. MORROW, JR. v. TAMMY LYNN (PUGH) MORROW. |
| Court | Tennessee Supreme Court |
Appeal from the Circuit Court for Wilson County; No. 4104; DVC Clara Byrd, Judge.
Judgment of the Circuit Court Affirmed as Modified.
John Michael Garrett, Larry H. Hagar, Nashville, Tennessee, for the appellant, Tammy Lynn (Pugh) Morrow.
Shawn J. McBrien, Lebanon, Tennessee, for the appellee, Gordon E. Morrow, Jr.
Patricia J. Cottrell, J., delivered the opinion of the court, in which William C. Koch, P.J., M.S., and Frank G. Clement, Jr., J., joined.
The husband filed for divorce after a marriage of over twenty-three years. The trial court granted the divorce to the wife on the ground of the husband's inappropriate marital conduct and divided the marital property equally between the parties. Because of the property division, and because the wife had more formal education than the husband, the court decided that she was not entitled to any alimony. The wife appealed. We modify the trial court's decree to eliminate the payment to the husband ordered as part of the property division. Because this modification serves the goal of self-sufficiency for the economically disadvantaged spouse, we affirm the denial of alimony. We also affirm the award of attorney's fees.
Gordon "Buddy" Morrow and Tammy Lynn Pugh Morrow married in 1979. Their marriage produced two children, Lindsey, a daughter who was born in 1985, and Blake, a son who was born in 1988. On December 27, 2002, Mr. Morrow filed a Complaint for Divorce in the Circuit Court of Wilson County. The Complaint stated that "irreconcilable differences have arisen between the parties such that they can no longer live together as husband and wife." Mr. Morrow did not request child custody, but asked the court to equitably divide the marital property and the marital debts.
Ms. Morrow's Answer and Counter-Complaint for Divorce was filed on January 23, 2003. She claimed that her husband "has been guilty of such inappropriate marital conduct as renders cohabitation unsafe and improper." She asked for custody of the two children, child support, division of marital property, and either alimony in futuro or alimony in solido. Mr. Morrow had moved into a bonus room in the marital home just prior to filing for divorce. Several weeks after Ms. Morrow answered, he moved out of the marital home and into a duplex owned by his father.
The court conducted its first hearing in this case on February 19, 2003 and heard evidence as to the parties' income and expenses. At the conclusion of the hearing, the court ordered Mr. Morrow to pay $935 per month as pendente lite child support and alimony. Ms. Morrow subsequently filed a motion for an increase in support, and after a hearing the trial court increased support to $1,166 per month "as long as the daughter continues to reside with the mother." Several months of discovery followed, during which Mr. Morrow initially denied but finally admitted to an affair with another woman. He claimed, however, that the affair did not begin until after the parties separated.
The final hearing of this case took place over two days, beginning on July 16, 2003. The only witnesses to testify were the parties themselves and their Certified Public Accountant (CPA). There was little testimony as to grounds. Most of the testimony and all of the documentary evidence that was presented involved financial matters.
Ms. Morrow had earned an associates degree in business from Cumberland University, and then left school in order to marry. During the first years of the parties' marriage, she worked at Safeco Insurance Company. After their first child was born, the parties agreed that Ms. Morrow should leave her job to become a full-time mother and homemaker while Mr. Morrow provided all the financial support for the family. The proof showed that the parties were generous to their children. For example, they bought a $5,000 motorcycle for Blake and built a motorcycle racing track on their property for his use.1
Several years prior to the filing of the divorce complaint, Ms. Morrow took a job with the Wilson County Board of Education. That job paid about $8.60 an hour. She subsequently transferred into a job as a school secretary at Lebanon High School so she could be on the same schedule as her son and could work near him. That job paid $7.63 per hour. During the hearing, Ms. Morrow expressed an interest in going back to school so she could become either a licensed practical nurse, which would enable her to find a job paying about $12 per hour, or a registered nurse, which would pay about $28 per hour.
Mr. Morrow only had a high school diploma, but had learned the construction trade from family members. The proof showed that he was a hard worker and a good provider. During the first few years of marriage, he worked for an insulation company. He later became a carpenter and operated his own home building and framing company, Buddy Morrow Construction. He was also involved in a partnership with his family that bought and sold real property. The couple was very successful at accumulating assets. The court found the net value of the marital estate to be almost $540,000.
The most valuable asset of the parties was the marital home in Lebanon, which Mr. Morrow built himself. The parties stipulated to an appraisal that valued the home and the five acres on which it sits at $302,000. The property was not subject to a mortgage or any other encumbrance. At the time of divorce, the parties also owned a duplex and two unimproved lots. The parties had differing views about the value of those properties. The trial court found the equity in the duplex to be $64,500 and the equity in the lots to be $15,873. Another substantial marital asset was a savings account holding $75,690 from sales of real property.
In order to adequately deal with the question of child support, and to a lesser extent with the question of alimony, the court had to determine Mr. Morrow's earning capacity and/or his income. The CPA submitted unaudited tax returns for 1999, 2000, and 2001. They showed the profits from Mr. Morrow's framing business for those years to be $9,499, $ 26,414, and $14,525 respectively2 . The trial court was understandably skeptical about those figures and commented that they were inconsistent with the size of the marital estate.
Closer examination of the tax returns and further questioning indicated the use of a number of strategies to reduce the parties' tax obligation. Mr. Morrow's business enjoyed revenue that ranged from a low of $178,000 to a high of $534,000 during the years in question. While labor costs consumed most of that money, Mr. Morrow also purchased real property with some of it and deducted the purchase price as a business expense. He also applied accelerated depreciation schedules to the equipment he purchased. Sometimes he bartered his labor for cash or services, and he may have used cash transactions on occasion. Of course, by using his own labor to build the marital home, he was able to increase his net worth without generating any additional taxable income.
A loan application that the parties submitted in 2002 to the Wilson Bank and Trust recited a $56,000 annual income for the parties, with $7,000 - $8,000 attributed to Ms. Morrow. Mr. Morrow testified that he earned about $25 an hour as a framing carpenter, but that rainy or inclement weather imposed an upper limit on the number of days he could work.
At the conclusion of the first day of hearings, the trial court declared that it was granting the divorce to Ms. Morrow. Final decisions on property division, child support and alimony were held in abeyance until the second day of hearings on August 6, in part to allow Mr. Morrow to submit into evidence his 2002 tax return, which had not yet been filed. That return proved to be consistent with the earlier ones, showing revenues of $263,485 for Buddy Morrow Construction, and net profit of $16,093.
At the conclusion of all the proof, the trial court announced its decision from the bench, a decision that was memorialized in its order of September 11, 2003. The court granted the divorce to Ms. Morrow on the ground of the adulterous conduct of Mr. Morrow and ruled that, in light of the length of the marriage and the contributions of both parties to the marital estate, the most equitable division of the property was one that was exactly equal. The court found the total value of the marital property to be $539,768 and awarded each party property worth $269,884.3
Mr. Morrow was awarded the duplex, the two lots, the savings account, and all the equipment associated with his business. Ms. Morrow wished to remain in the marital home with the children and was awarded that property. The court placed a lien on the home in favor of Mr. Morrow in the amount of $66,056, to equalize the property division. The amount of the lien was ordered to be paid by July 1, 2007, or earlier if Ms. Morrow sold or refinanced the home.
The court further found Mr. Morrow's annual income to be $36,000 per year or $3,000 per month, and set child support in accordance with the guidelines at $762 per month, with a reduction to $500 per month after the daughter graduates from high school. Mr. Morrow was also ordered to pay Ms. Morrow $ 214 per month to reimburse her for the children's medical insurance premiums.
The court stated that it was declining Ms. Morrow's request for alimony because of the financial burden that child support placed upon Mr. Morrow and because Ms. Morrow has more education than Mr. Morrow does. The court commented that "I can't see ordering Mr. Morrow to pay alimony for the rest of his life," and declared that Ms. Morrow was capable of finding a better-paying job than the one she had. The court...
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