Stewart v. Stewart, 2007-CA-00987-COA.

• Citation: 2 So.3d 770
• Decision Date: 10 February 2009
• Docket Number: No. 2007-CA-00987-COA.,2007-CA-00987-COA.
• Parties: Carey G. STEWART, Appellant, v. Bessie M. STEWART, Appellee.
• Court: Court of Appeals of Mississippi

2 So.3d 770

Carey G. STEWART, Appellant, v. Bessie M. STEWART, Appellee.

No. 2007-CA-00987-COA.

Court of Appeals of Mississippi.

February 10, 2009.

W. Brady Kellems, Brookhaven, Joseph Preston Durr, attorneys for appellant.

Robert W. Lawrence, Crystal Springs, attorney for appellee.

Before MYERS, P.J., BARNES and ROBERTS, JJ.

BARNES, J., for the Court.

¶ 1. Carey Stewart (Carey) appeals the decision of the Chancery Court of Copiah County regarding the classification and distribution of marital assets and the attorney's fees awarded to Bessie Stewart (Bessie). Finding no error, we affirm.

SUMMARY OF FACTS AND PROCEDURAL HISTORY

¶ 2. Carey and Bessie were married on March 23, 1994, and resided in Copiah County, Mississippi. They have one child together, Jamar Stewart, whose date of birth is September 3, 1996. Also, through previous relationships, Carey has two daughters, and Bessie has one daughter. Both had full custody of their children.

¶ 3. Carey owned and operated Stewart's Auto Sales and Body Shop in Hazlehurst, Mississippi, and he had owned the business for fifteen years prior to his marriage to Bessie. In the course of business, Carey bought damaged vehicles and repaired them for resale; therefore, inventory changed on a rotating basis. Carey was solely responsible for any business indebtedness, both as to the mortgage and loans on the personal properties. Although Bessie testified that she worked at the auto shop for a short period of time, she was compensated for her work. For a period of time, Bessie attended college two or three nights a week, but eventually, she went back to teaching when Jamar was old enough to attend school.¹

¶ 4. Carey also owned a separate residential property prior to the marriage, as did Bessie.² Although Carey and Bessie lived in his prior residence during the first few years of marriage, they eventually built a new home. The proceeds from the sale of Carey's prior residence, totaling $23,000, were put into the construction of their "marital property" residence.

¶ 5. On December 5, 2004, Carey and Bessie separated from each other. They reconciled on February 4, 2005, and lived together as husband and wife until their final separation on March 6, 2005. They have not cohabitated since that time. Carey filed his complaint for divorce and related relief on May 11, 2005. Subsequent to trial, but prior to the rendering of the chancellor's opinion, the parties submitted a joint amended consent and stipulation agreement, which was adopted by the chancellor. Carey was granted full legal and physical custody of Jamar, subject to the visitation rights of Bessie. Bessie was also ordered to pay $221 per month in child support. Carey was ordered to pay Bessie the sum of $56,610 in cash as equitable distribution of the marital property. On April 24, 2007, the chancellor granted the parties a divorce on the ground of irreconcilable differences, and on May 10, 2007, he entered a final judgment of divorce.

¶ 6. Carey now appeals the chancellor's findings regarding the classification of the marital estate and award of attorney's fees to Bessie.

STANDARD OF REVIEW

¶ 7. This Court reviews a chancellor's decision under an abuse of discretion standard and will not disturb the chancellor's findings of fact unless they are "manifestly wrong or clearly erroneous." Mosby v. Mosby, 962 So.2d 119, 121 (¶ 6) (Miss.Ct.App.2007). In determining the equitable division of marital property, a chancellor must follow the guidelines established in Hemsley v. Hemsley, 639 So.2d 909 (Miss.1994) and Ferguson v. Ferguson, 639 So.2d 921 (Miss.1994). Fogarty v. Fogarty, 922 So.2d 836, 839 (¶ 13) (Miss.Ct.App.2006). First, the parties' assets have to be classified as either marital or non-marital. Id. Unless an asset is shown to be solely attributable to a party's separate estate prior to or outside of the marriage, it is subject to equitable division. Pearson v. Pearson, 761 So.2d 157, 162 (¶ 15) (Miss.2000). Then the chancellor must equitably divide the designated marital property between the parties using the factors set forth in Ferguson as guidelines. Long v. Long, 928 So.2d 1001, 1004 (¶ 19) (Miss.Ct.App.2006). This Court has stated that "equitable distribution is a fair division of marital property based on each spouse['s] contribution to [the] assets during the marriage." Spahn v. Spahn, 959 So.2d 8, 14 (¶ 14) (Miss.Ct.App.2006). Therefore, the key goal for a chancellor in a divorce proceeding is to make certain that equity is accomplished, which requires fairness to both parties. Clark v. Clark, 754 So.2d 450, 461 (¶ 62) (Miss.1999). Additionally, the chancellor's objective is not only to distribute the marital property fairly, but to "conclude the parties' legal relationship, leaving them each in a self-sufficient state, where the facts and circumstances permit total dissolution." Bullock v. Bullock, 699 So.2d 1205, 1211 (¶ 26) (Miss.1997) (quoting Ferguson, 639 So.2d at 929).

I. Whether the chancellor erred by classifying proceeds from the sale of Carey's prior residence as marital property.

¶ 8. Carey contends that the $23,000 in proceeds from the sale of his prior residence, which was reinvested in the new marital residence, should not have been classified as marital property. There were conflicting testimony and evidence as to how long Carey and Bessie resided in Carey's previous residence. Carey testified at one point that it was seven years; then later he stated that it was about three years. The chancellor did not find the latter testimony credible as Carey and Bessie were married in 1994, yet testimony also showed that they did not move into their new home until 2002 or 2003.

¶ 9. However, we find the issue of whether the couple lived in Carey's prior residence for three years, seven years, or nine years irrelevant. Even if it can be proved that assets are attributable to a party's separate estate, "when separate, non-marital property is commingled with marital property the separate property can lose its characterization as such and become marital property subject to equitable distribution." Franks v. Franks, 759 So.2d 1164, 1169 (¶ 17) (Miss.1999). Consequently, "non-marital assets may lose their characterization as such if the party commingles the asset with marital property or uses them for familial benefit." Hankins v. Hankins, 866 So.2d 508, 511 (¶ 14) (Miss.Ct.App.2004) (citing Johnson v. Johnson, 650 So.2d 1281, 1286 (Miss. 1994)). As the chancellor noted, both homes that Carey and Bessie resided in were used by the family. Although Carey owned the house prior to his marriage to Bessie, the property gained status as a marital asset upon its prolonged use as their family home. See A & L, Inc. v. Grantham, 747 So.2d 832, 839-40 (¶ 26) (Miss.1999) (proceeds from the sale of the husband's home that was owned prior to marriage were used to support his family and for construction of a new home for the couple; therefore, the proceeds were commingled and converted into marital assets subject to distribution).

¶ 10. Carey also argues that although Bessie resided at his former home, she made no contributions toward any improvements and, thus, was not entitled to any equity that accrued while she lived there. Although the record reflects that Bessie was a homemaker and student for much of the marriage and, therefore, made minimal financial contributions to the home or business, that is not enough to deny her an equitable share of the marital assets. Carey encouraged Bessie to stay home, raise their family, and go to school to further her education. Carey even hired a housekeeper for their home, so that Bessie might concentrate on her studies. Therefore, we find that Bessie's role as a homemaker and mother during their time at Carey's prior residence was sufficient to warrant a showing of contribution to the equity of the home. In reviewing a chancellor's ruling in a divorce proceeding, this Court must assume that any contributions or efforts by either party in the marriage, "whether economic, domestic or otherwise[,] are of equal value." Johnson v. Johnson, 877 So.2d 485, 491 (¶ 23) (Miss Ct.App.2003) (quoting Hemsley, 639 So.2d at 915).

¶ 11. Based on the foregoing, we find no error in the chancellor's classification of the $23,000 in proceeds from the sale of Carey's former residence as marital property.

II. Whether the chancellor erred in classifying vehicles, shop equipment, and inventory as marital property.

¶ 12. Although the chancellor determined that Carey's body shop business was not marital property, he did find that several vehicles associated with the business, which had no debt and a value of $11,300, were marital property and, therefore, were subject to equitable distribution.³ Any other vehicles were disregarded as they were secured by the floor plan indebtedness. Based on the evidence in the record, the chancellor found that $75,029 in inventory was purchased during the marriage. This amount was eighty percent of the total value of the shop equipment and inventory listed on the couple's 2003 tax return. However, based on testimony by Carey that the shop equipment and inventory were only worth $50,000 (minus $4,629 for debt), the chancellor only considered eighty percent of the $45,371 as a marital asset, which was calculated to be $36,296.80. Carey contends that the chancellor erred in considering the shop inventory and equipment as marital assets. Alternatively, he argues that even if they were properly considered as marital assets, Bessie was not entitled to equitable division of these assets as she made no contribution to the business.

¶ 13. Carey cites to Mississippi cases in which a spouse has not been awarded any interest in the other spouse's business based on minimal contribution. See Elam v. Hinson, 932 So.2d 76, 80 (¶ 15) (Miss.Ct. App.2006) (wife not entitled to a share of her husband's business as any contributions by the wife were insignificant to...