Pittman v. Jetter Pittman & Pittman Prof'l Land Surveying, Inc.

• Citation: 407 S.C. 141,754 S.E.2d 501
• Decision Date: 06 March 2014
• Docket Number: Nos. 27352.,s. 27352.
• Court: South Carolina Supreme Court
• Parties: Gloria PITTMAN, Respondent, v. Jetter PITTMAN and Pittman Professional Land Surveying, Inc., Defendants, of whom Jetter Pittman is, Petitioner. Appellate Case No. 2011–203269.

407 S.C. 141

754 S.E.2d 501

Gloria PITTMAN, Respondent,

v. Jetter PITTMAN and Pittman Professional Land Surveying, Inc., Defendants,of whom Jetter Pittman is, Petitioner.Appellate Case No. 2011–203269.

Nos. 27352.

Supreme Court of South Carolina.

Heard Nov. 5, 2013.

Decided Jan. 15, 2014.

Rehearing Denied March 6, 2014.

Thomas F. McDow, IV, and Erin K. Urquhart, both of Law Office of Thomas F. McDow, Rock Hill, for Petitioner.

Daniel D. D'Agostino, of York, for Respondent.

Justice KITTREDGE.

In this domestic action, we granted a writ of certiorari to review the court of appeals' decision affirming the family court's finding of transmutation, which resulted in the inclusion of Petitioner Jetter Pittman's premarital land surveying business in the marital estate. Pittman v. Pittman, 395 S.C. 209, 717 S.E.2d 88 (Ct.App.2011). Although we find the court of appeals erred in affirming the family court's reliance on the parties' premarital conduct in the transmutation analysis, we affirm based on the parties' conduct during the marriage. We find the evidence preponderates in support of a finding that the parties intended the land surveying business to be the common property of the marriage.

I.

Jetter Pittman (Husband) and Gloria Pittman (Wife) were married in April 2000 and separated in March 2007. It was a second marriage for both, and they have no children together. Wife instituted this divorce action against Husband in May 2007, on the grounds of adultery. In addition, Wife argued to the family court that Husband's land surveying business, Pittman Professional Land Surveying, Inc., was transmuted into marital property and was thus subject to equitable apportionment.

Husband and Wife met and began their relationship in 1991. Wife worked as a registered nurse in Rock Hill, South Carolina. Husband, a licensed professional land surveyor, was living and working in Winston–Salem, North Carolina. The parties' relationship was long-distance at first, but in May 1993, Husband's job was transferred to Albemarle, North Carolina, and Husband then moved in with Wife in her Fort Mill, South Carolina home. From the time the parties began living together and throughout the marriage the parties pooled their funds in a joint checking account, and Wife paid all of the parties' personal and household expenses from their joint account.

In addition to his full-time job, Husband regularly took side jobs as a surveyor. Throughout the parties' relationship, Wife assisted Husband with his surveying jobs by handling all the billing and accounting tasks and by performing light field duties on occasion. In 1996, Husband quit his full-time job and became self-employed, incorporating his surveying business (Business) ¹ and initially operating from the upstairs bedroom of Wife's home. ² Both parties had day-to-day responsibilities for the Business; Husband managed the surveying jobs and the employees, and Wife continued to handle all the financial and bookkeeping tasks for the Business, in addition to maintaining her employment as a registered nurse. Although this arrangement began at the inception of the Business—before the parties were married—it also continued during the marriage and did not cease until approximately six months after Wife filed for divorce.

After the parties married in 2000, they agreed for Wife to take on an increased role and participation in the Business and work only part-time at the hospital. As the Business grew, Wife increased her commitment to the Business, often working 35–hour weeks, while ultimately decreasing her nursing job to one day per week.³ When the Business first began, the parties were sometimes unpaid for their work; however, by the time of separation, both Husband and Wife both drew a salary from the Business, with Wife receiving $4,200 per month. From the date of marriage to the date of separation, Wife's income steadily increased each year. The parties agreed to raise Wife's salary to increase her social security income because Wife was older than Husband ⁴—a decision the parties made for their mutual benefit so they would have more money during their retirement.

Additionally, before the Business was firmly established and producing significant income, the parties purchased three surveying geodimeters at a cost of more than $30,000 each. The record reveals that, at the time of marriage, the parties were still servicing debt associated with the geodimeters. Further, in November 2002, both Husband and Wife signed an unlimited personal guaranty agreement to secure the Business's financial obligations.⁵

The family court granted Wife a divorce on the ground of adultery; ordered Husband to pay Wife $600 per month in permanent, periodic alimony; identified, valued, and equitably apportioned marital property and debts; and awarded wife $12,500 in attorney's fees. In identifying marital property, the family court found the Business was transmuted into marital property and was properly included in the marital estate. Specifically, the family court found:

The [Wife] and [Husband] both worked in the company, increased its value, had a plan for growing and developing the business, jointly made decisions as to the business, jobs, loans, and employees. The [Wife] signed an unlimited guarantee for the business. The [Husband] clearly treated the business as a martial [sic] asset during the entirety of the marriage.

The family court emphasized that Husband was able to become self-employed in 1996 “because he was able to fall back on the [Wife's] full-time guaranteed income and the parties, prior to the marriage, pooled their money and paid all bills jointly.”

In ascertaining the marital estate, the family court found the parties intended the Business to be a joint asset of the marriage. In including the value of the Business in the marital estate,⁶ the family court rejected Husband's argument that he was entitled to a special equity in the value of Business as of the date of the marriage. The family court weighed the statutory factors and determined a 50/50 division of the marital estate was appropriate and equitable. The marital estate was apportioned accordingly.

Husband filed a motion for reconsideration pursuant to Rule 59(e), SCRCP, arguing the family court's finding that the Business was transmuted was unsupported by any evidence in the record demonstrating Husband's intent to treat the Business as a marital asset. The family court rejected Husband's argument, reiterating that the credible evidence objectively established transmutation. Husband appealed.

The court of appeals affirmed in part and reversed in part. Concerning the transmutation issue, the court of appeals found that Wife met her burden of showing the parties intended to treat the Business as a marital asset. Following the denial of Husband's petition for rehearing, this Court granted Husband's petition for a writ of certiorari to review the court of appeals' decision regarding the transmutation finding.

II.

“ ‘In appeals from the family court, the appellate court has jurisdiction to find facts in accordance with its view of the preponderance of the evidence. However, this broad scope of review does not require this Court to disregard the findings of the family court.’ ” Lewis v. Lewis, 392 S.C. 381, 384, 709 S.E.2d 650, 651 (2011) (quoting Eason v. Eason, 384 S.C. 473, 479, 682 S.E.2d 804, 807 (2009)). “[T]he appellate court is not required to disregard the findings of the trial judge who was in a superior position to make credibility determinations.” Id. at 385, 709 S.E.2d at 651–52.

A.Transmutation

Husband argues the finding of transmutation was error because Wife presented no evidence that the parties intended the Business to be transmuted into marital property. Husband further claims the family court committed legal error in considering the parties' premarital conduct in the transmutation analysis. We agree with Husband on this latter point, but we find the record is replete with evidence of the parties' conduct during the marriage to support a finding of transmutation.

The term “marital property” means “all real and personal property which has been acquired by the parties during the marriage and which is owned as of the date of filing or commencement of the marital litigation ... regardless of how legal title is held.” S.C.Code Ann. § 20–3–630(A) (Supp.2013). However, “[p]roperty acquired prior to the marriage is generally considered nonmarital.” Pirri v. Pirri, 369 S.C. 258, 269, 631 S.E.2d 279, 285 (Ct.App.2006) (citing S.C.Code Ann. § 20–7–473(2) (Supp.2004)). Nevertheless, “[p]roperty that is nonmarital when acquired may be transmuted into marital property if it becomes so commingled with marital property that it is no longer traceable, is titled jointly, or is used by the parties in support of the marriage or in some other way that establishes the parties' intent to make it marital property.” Wilburn v. Wilburn, 403 S.C. 372, 384, 743 S.E.2d 734, 740 (2013) (citing Trimnal v. Trimnal, 287 S.C. 495, 497–98, 339 S.E.2d 869, 871 (1986)).

“As a general rule, transmutation is a matter of intent to be gleaned from the facts of each case.” Johnson v. Johnson, 296 S.C. 289, 295, 372 S.E.2d 107, 110 (Ct.App.1988). “The spouse claiming transmutation must produce objective evidence showing that, during the marriage, the parties themselves regarded the property as the common property of the marriage.” Jenkins v. Jenkins, 345 S.C. 88, 98, 545 S.E.2d 531, 537 (Ct.App.2001) (citing Pool v. Pool, 321 S.C. 84, 86, 467 S.E.2d 753, 756 (Ct.App.1996)).

In terms of evidence tending to establish transmutation, “the use of property in support of a marriage is relevant to transmutation[; however] the mere use of income from nonmarital assets does not transmute those assets into marital property.” Wilburn, 403 S.C. at 385, 743 S.E.2d at 741 (citing Peterkin v. Peterkin, 293 S.C. 311, 313, 360 S.E.2d 311, 313 (1987)).⁷ Husband seeks to characterize ...