Potter v. Easley
| Decision Date | 03 February 1986 |
| Docket Number | No. 85-144,85-144 |
| Citation | 288 Ark. 133,703 S.W.2d 442 |
| Parties | David J. POTTER, Appellant, v. Betty (Potter) EASLEY, Appellee. |
| Court | Arkansas Supreme Court |
Mitchell, Williams, Selig, Jackson & Tucker by Jim Guy Tucker, Little Rock, Steel & Steel by George E. Steel, Jr., Nashville, for appellant.
Smith, Jernigan & Smith by Robert D. Smith, III, and H. Vann Smith, Little Rock, for appellee.
This is the second appeal in this divorce case. Potter v. Potter, 280 Ark. 38, 655 S.W.2d 382 (1983). After hearing additional testimony on remand, Judge Ford referred to the parties' constant bickering, felt that he had reached the limit of his endurance, and withdrew from the case. Judge Langston was then assigned to the case and, after another hearing, entered the final decree. By then Mrs. Potter had remarried and is now Mrs. Easley. Potter's appeal comes to us under Rule 29(1)(j). He argues six assignments of error, none of which can be sustained.
I. Confirmation of Sale of Homeplace. Judge Ford ordered that the homeplace be sold at public sale for cash, check, or certified funds. The sale was conducted by the clerk of the court on May 6, 1982. The only bidders were the Potters. Potter opened the bidding at $40,000, though the mortgage debt against the property was about $45,000. When the bidding reached a point at which Mrs. Potter had bid $87,000, Potter stopped the sale by producing a $1,000 supersedeas bond and persuading the clerk to discontinue the sale and declare that it had not been completed.
After stopping the sale, Potter wrote to Judge Ford on the same day, explaining why he had stopped the sale. His main reason was that Mrs. Potter did not have the money to pay her bid and intended to use the "credits" she was entitled to under the divorce decree, then being appealed. Potter's letter went on to say:
[I]f those credits are reversed on appeal, Betty would not likely have any source of funds with which to pay if she were the successful bidder on the house....
In essence, she was bidding play money, and when the bid reached and slightly exceeded the value I testified the house would bring, I posted the supersedeas bond. While I was as anxious as anyone to conclude this matter, I cannot be placed in a position of bidding against a person who has no money with which to perform the sale. ... [I]f the money judgment awards are reversed, she will have no money with which to fulfill the sale. There would be no sanctions against her and I would be damaged with no recourse.
Later on Potter testified that if a resale were ordered his first bid would be $100,000. Mrs. Potter testified that she can pay her bid of $87,000.
Judge Ford was not unsympathetic toward Potter's self-induced predicament, for he said to Potter upon withdrawing from the case: "I feel that when you decide something you probably really believe it, and when you decide this is the way it ought to be, that you go forward in that, whether it's right or wrong or anything else." Nevertheless, after a hearing about confirmation Judge Ford wrote in an opinion:
It is inconceivable that the Court-ordered sale of the home property could be stopped as was testified to. I feel Mr. Potter waived the supersedeas he later posted, when he took part in the bidding. I will confirm the sale.
Judge Ford withdrew without having confirmed the sale, which was confirmed by Judge Langston.
It is now argued that we should set aside the confirmation and order a resale. We disagree. To begin with, Judge Ford was right in saying it was inconceivable that a judicial sale could properly be stopped midway, as Potter succeeded in doing. The court had ordered the sale. It was the duty of the parties to obey the order while it was in force, presenting objections later. See Stewart v. State, 221 Ark. 496, 254 S.W.2d 55 (1953).
In the second place, Potter cannot be allowed to take inconsistent positions by taking part in the bidding in its early stages and then repudiating the proceeding when the bidding reached what he considered a reasonable figure. It can hardly be doubted that if Potter had bid $85,000 and the bidding had ended, he would have sought confirmation. His maneuver was necessarily planned in advance, for he came to the sale with a supersedeas bond already signed by him and a surety. A court has the responsibility of protecting the integrity of its judicial sales, for otherwise prospective bidders can have no confidence in their legitimate high bids. Fleming v. Southland Life Ins. Co., 263 Ark. 272, 564 S.W.2d 216 (1978). There we cited some of our cases holding that a sale will not be reopened merely to permit a party to offer more money for the property. Without discussing all the appellant's lesser arguments, such as that the sale was invalid because the clerk did not announce the final bid three times, we conclude that the sale was rightly confirmed.
II. Division of Sale Proceeds. In the divorce decree, from which the first appeal was taken, the chancellor ordered that the homeplace be sold and the proceeds, less the mortgage debt and expenses, be divided equally between the parties. Potter argued on appeal that the proceeds should be divided in proportion to the parties' contributions to the acquisition of the property, which he calculated in his appellate brief to have been as follows:
Potter's contributions
Mills fee $7,000.00
Fayetteville proceeds 9,656.08
Gift from McMillin 5,000.00
Debt reduction 3,051.00
---------
24,707.08
Mrs. Potter's contribution
Debt reduction 3,051.00
On that basis Potter argued that he would be entitled to 89% of the proceeds of sale and Mrs. Potter to 11%. His theory of proportionate division rested primarily on the case of Tibbetts v. Tibbetts, 406 A.2d 70 (Me.1979).
Potter's calculation was based to a large extent upon his own testimony and so is not treated as undisputed. On the first appeal we recognized, on the authority of a Texas case, that property acquired in part out of marital funds and in part out of one spouse's separate funds may be in part marital property and in part separate. We resolved the issue by holding that Potter "owns a separate interest in the lot and house in the amount of $9,656.08." We cited the Tibbetts case, not for the principle of proportionate division but for the "acquired in exchange for" clause in statutes governing the division of community property.
On remand Judge Langston construed our opinion to mean that Potter is entitled to $9,656.08 from the net proceeds of sale, the rest to be divided equally. The judge was right. Our settled procedure is to review chancery cases de novo and to end the controversy by a final judgment or by a direction to the chancellor to enter a final decree. Wilborn v. Elston, 209 Ark. 670, 191 S.W.2d 961 (1946). When, as here, the facts have been fully developed, it would be pointless for us to remand the case to the chancellor for a further evaluation of the facts, with the possibility of a second appeal on the same facts. Yet that is in effect what the appellant is arguing to have been the intent of our opinion on the first appeal.
It is our practice not to leave questions unanswered on chancery appeals. That practice was followed in this case. Our holding that Potter is entitled to a separate $9,656.08 interest in the homeplace was a rejection of his theory of proportionate division. Had we meant to adopt that theory we would have spelled out the exact interest of each party and not have left that question for the chancellor to decide on the very facts that were before us. Needless to say, our opinion on the first appeal is the law of the case, which we would not be at liberty to modify even if we now thought it erroneous. Wilson v. Rodgers, 256 Ark. 276, 507 S.W.2d 508 (1974); United States Annuity & Life Ins. Co. v. Peak, 129 Ark. 43, 195 S.W. 392, 1 A.L.R. 1259 (1917); Taliaferro v. Barnett, 47 Ark. 359, 1 S.W. 702 (1886).
On this appeal the dissenting opinion argues that we should allow Potter a larger share of the proceeds from the sale of the homestead, proportionate to his contribution of $9,656.08. The justification offered is that the opinion on the first appeal was wrong in this respect.
There are two answers to this argument. First, we are by no means convinced that our decision was wrong. It was not contrary to the specific language of the statute. The statute defines "marital property" as all property acquired subsequent to the marriage, with five specific exceptions. Ark.Stat.Ann. § 34-1214(B) (Supp.1985). All five classes of excepted property might be acquired before a marriage, but only subsection (5) mentions an increase in value: "(5) The increase in value of property acquired prior to the marriage." The homeplace in question was not so acquired. We do not say that increases in the value of property in the other classes are necessarily included in the definition of marital property, but that is a question of statutory interpretation that might vary with the fact situation.
On the first appeal we allowed one of the disputed items claimed by Potter, but disallowed two others. The actual award of $9,656.08 was evidently selected as the best choice among several possibilities. In fairness we should not reconsider only one of the items without reopening the whole issue and possibly deciding that even the allowance of $9,656.08 was too liberal.
Second, the doctrine of the law of the case requires us to adhere to our decision on the first appeal even though we might think it to have been wrong. The annotation cited in the dissent states in § 4 that some courts follow what is sometimes referred to as the "right or wrong" rule, by which the first decision is considered to be binding whether it was right or wrong. 87 A.L.R.2d 271, 285. The...
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