Stroh v. Stroh, 2015–CA–01719–COA

• Decision Date: 27 June 2017
• Docket Number: NO. 2015–CA–01719–COA,2015–CA–01719–COA
• Citation: 221 So.3d 399
• Parties: Jeffrey Jack STROH, Appellant v. Nancy Jane Zehr STROH, Appellee
• Court: Mississippi Court of Appeals

221 So.3d 399

Jeffrey Jack STROH, Appellant

v.Nancy Jane Zehr STROH, Appellee

NO. 2015–CA–01719–COA

Court of Appeals of Mississippi.

June 27, 2017

ATTORNEYS FOR APPELLANT: MICHAEL J. MALOUF, ROBERT E. JONES II

ATTORNEY FOR APPELLEE: T. JACKSON LYONS

BEFORE GRIFFIS, P.J., FAIR AND WILSON, JJ.

WILSON, J., FOR THE COURT:

¶ 1. Jeff and Nancy Stroh agreed to an irreconcilable differences divorce and agreed that the Rankin County Chancery Court would determine and distribute the marital estate and rule on Nancy's claim for alimony. After a two-day trial, the chancellor entered an opinion and final judgment dividing the marital estate and awarding Nancy periodic alimony. On appeal, Jeff alleges that the chancellor erred (I) by not including Nancy's residence in the equitable distribution of the marital estate despite finding that the home was marital property; (II) by equally dividing the value of a tract of land referred to as "the Hill"; (III) by valuing the Hill at $106,000; (IV) by not accounting for a $7,000 debt incurred in connection with the parties' purchase of a sailboat; and (V) by awarding Nancy $750 per month in periodic alimony.

¶ 2. We reverse and remand for further proceedings consistent with this opinion as to issues (I) and (V). We find no error and affirm as to issues (II), (III), and (IV).

FACTS AND PROCEDURAL HISTORY

¶ 3. Jeff and Nancy married on July 27, 2007. This was the second marriage for both Jeff, who was fifty-two years old at the time of the marriage, and Nancy, who was then forty-five years old. Jeff had two children from his prior marriage, which ended in divorce after twenty-six years. Nancy had two children from her prior marriage, which ended in divorce after sixteen years.

¶ 4. Prior to and during the marriage, Jeff owned two businesses in Pearl: Eldorado Storage LLC and Outdoor Graphics. Eldorado Storage is a storage rental business with seven storage buildings, five of which were constructed and being rented prior to Jeff's marriage to Nancy. The other two buildings were finished during the marriage but were 90% finished before the marriage. Outdoor Graphics is a small mailbox and sign production company that Jeff has operated since college.

¶ 5. Nancy was found to be disabled prior to her marriage to Jeff and began receiving Social Security disability payments. She worked sporadically prior to the marriage but not enough to support herself. After her marriage to Jeff, Nancy did some bookkeeping and clerical work for Jeff's businesses, for which she was compensated. Nancy also managed the couple's finances.

¶ 6. When they were married, Jeff moved into Nancy's home. Jeff continued to own his prior residence in Pearl. During the marriage, Jeff performed maintenance and repair work at the marital residence. He cleared the back part of the three-acre lot of tree stumps and other growth, graded and landscaped the lot, maintained the swimming pool, and installed three pool pumps and a new pool liner. He also built and installed shutters, installed copper

lanterns, and enclosed the back porch. Jeff and Nancy also substantially paid down the mortgage on the home during the course of the marriage. The evidence indicates that the parties made mortgage payments of approximately $70,000 during the course of the marriage. Nancy's Rule 8.05 financial statement estimated the value of her home at $250,000, with a mortgage balance of $13,671. Jeff estimated that the parties spent approximately $13,000 on improvements to the home (not counting his own labor) during the course of the marriage.

¶ 7. The parties never lived in Jeff's prior residence during the marriage. Instead, it was used as a rental property.

¶ 8. Jeff owned the property on which he built Eldorado Storage prior to the marriage. Adjacent to that property is a 2.45–acre lot that the parties refer to as "the Hill." When Jeff constructed and began operating Eldorado Storage, his mother, Joyce, owned the Hill. Joyce allowed Jeff to install sewer treatment lines on the Hill because sewer service was not available and there was no room to install lines on the Eldorado Storage property. Jeff testified that Joyce permitted him to install sewer lines on the Hill because she intended to give him the property one day.¹ Jeff described the system as consisting of sewer treatment lines and above-ground "spray heads" that spray out treated water in a thirty-foot radius.

¶ 9. In 2007, after Jeff married Nancy, he offered to buy the Hill from Joyce, and she agreed to sell him the land for $21,000. Jeff used funds from Eldorado Storage to make a $5,000 down payment and $300 monthly payments until the amount was paid in full in 2012. Jeff's mother then conveyed the land to Jeff and Nancy as joint tenants with rights of survivorship. Jeff and Nancy also successfully petitioned the City of Pearl to rezone the property as commercial property. No improvements have been made to the Hill since Jeff's installation of the sewage treatment system.

¶ 10. The Hill, the lots on which Eldorado Storage and Outdoor Graphics are located, Jeff's residence, Joyce's former residence, a vacant lot, and an approximately one-acre lot referred to as "the Boneyard" are all part of the same continuous tract of land along Eldorado Road and Summer Ridge Drive in Pearl. Jeff purchased the Boneyard and the vacant lot prior to his marriage to Nancy. This land has been in Jeff's family for a number of years.

¶ 11. From the beginning of the marriage until approximately January 2013, Nancy assisted Jeff's business as a part-time bookkeeper. At times, she also assisted him with accounts payable and in making various business decisions. Nancy testified that she also "did everything at home so Jeff could come and go to work," i.e., "the laundry, the housekeeping, the cooking, the grocery shopping," etc. She was also responsible for the couple's personal banking and finances.

¶ 12. During the marriage, Jeff and Nancy purchased a Cape Dory Mark II sailboat for $14,000 in an online auction. Jeff and Nancy traveled to Maryland to get the boat and sailed for ten days before leaving it in North Carolina to be transported back to Mississippi. Testimony concerning the source of funds used to pay for the boat was unclear and conflicting. Nancy testified that she withdrew funds from her money market account to fund at least part of the purchase price, various upgrades, and/or the sailing trip. Jeff testified that he took out a home equity loan to pay for the boat and related expenses. On appeal, Jeff claims that he still owes $7,000 on that loan.

¶ 13. Jeff and Nancy separated on March 23, 2014. Jeff claimed that Nancy was the cause of the separation. He testified that Nancy constantly pressured him to put her name on separate assets that he had accumulated prior to the marriage, which he intended to leave to his sons. Jeff felt like Nancy was forcing him to choose between her and his sons, which Nancy denied. Nancy testified that she did not want to divorce Jeff and desired to reconcile long after he left her. Jeff left the marital home abruptly on March 23, 2014. He sent Nancy a text message to let her know that he wanted to separate and was leaving.

¶ 14. Nancy subsequently filed a complaint for separate maintenance, and Jeff answered and counterclaimed for divorce on the grounds of habitual cruel and inhuman treatment, or in the alternative, irreconcilable differences. On July 21, 2015, Jeff and Nancy filed a joint motion consenting to an irreconcilable differences divorce and to trial on specified issues. The chancellor signed an order granting the motion. In the motion, the parties stipulated that "[e]ach party may retain use and ownership of their respective homes." They also submitted the following issues for decision by the court: (1) "[p]roperty rights between the parties"; (2) alimony, if any; (3) "[d]etermination of marital assets and equitable distribution of all assets of the marriage"; (4) "[r]esolution of differing valuations of property"; (5) determination and assignment of all marital debts; (6) "[d]istribution of the personal property of the marriage"; (7) any issues related to tax deductions, exemptions, refunds, or liabilities; (8) any assessment of costs and attorney's fees; and (9) whether any "marital waste" had occurred and any assessments for the same.

¶ 15. Trial was held on July 21–22, 2015. The chancellor issued a final judgment and opinion on September 18, 2015, which addressed all issues submitted by the parties. The chancellor found that Nancy's residence was marital property; however, he concluded that it was "not ... subject to equitable division due to the agreement of the parties." The chancellor ruled that Jeff's residence, Eldorado Storage, Outdoor Graphics, the vacant lot, and the Boneyard were all Jeff's separate property. The chancellor found that the Hill was marital property and that it should be valued at $106,000. He ordered Jeff to pay Nancy $53,000 for her interest, plus $4,500 in rent payments received by Jeff after the parties' separation. The chancellor provided that Jeff could pay this amount in twenty-eight monthly installments of $2,000, plus a final installment of $1,500. The chancellor found that the Cape Dory sailboat was difficult to value, so he ordered Jeff to make Nancy an offer to purchase her interest in the boat, which Nancy would be free to accept or reject; however, if Nancy rejected Jeff's offer, she would be required to purchase Jeff's interest from him for the same amount.² Finally, the chancellor awarded Nancy permanent periodic alimony of $750 per month. The chancellor's opinion included full Ferguson³ and Armstrong⁴ analyses.

¶ 16. Jeff filed a timely motion for reconsideration, which was denied, and a timely notice of appeal. On appeal, he raises the five issues listed above in ¶ 1, which concern Nancy's residence, the Hill, debt related to the Cape Dory sailboat, and alimony.

ANALYSIS

¶ 17. "When reviewing a decision of a chancellor, this...