Tramel v. Tramel, 96-CT-01275-SCT.

• Citation: 740 So.2d 286
• Decision Date: 12 August 1999
• Docket Number: No. 96-CT-01275-SCT.,96-CT-01275-SCT.
• Parties: Wendell Wayne TRAMEL v. Lisa Renee Coleman TRAMEL.
• Court: United States State Supreme Court of Mississippi

740 So.2d 286

Wendell Wayne TRAMEL v. Lisa Renee Coleman TRAMEL.

No. 96-CT-01275-SCT.

Supreme Court of Mississippi.

August 12, 1999.

Robert H. Broome, Batesville, Attorney for Appellant.

John T. Lamar, Jr., Senatobia, Attorney for Appellee.

EN BANC.

ON WRIT OF CERTIORARI

MILLS, Justice, for the Court:

¶ 1. We granted certiorari to address the division of personal injury settlements between spouses in divorce proceedings. The Court of Appeals found that the law has broadened in favor of the non-injured spouse since we last squarely addressed the issue in Regan v. Regan, 507 So.2d 54 (Miss.1987). The Court of Appeals reversed and remanded to the Chancery Court of Panola County for further proceedings. Tramel v. Tramel, ___ So.2d ___, 1998 WL 536861 (Miss.Ct.App. Aug.18, 1998). Finding the decision of the Court of Appeals to be correct, we affirm.

STATEMENT OF THE FACTS

¶ 2. On November 6, 1996, Lisa Tramel was awarded a divorce from her husband of seventeen years, Wendell Tramel, on the grounds of habitual cruel and inhuman treatment. The chancellor awarded Lisa forty percent of the proceeds from a personal injury settlement received by Wendell as the result of a work-related accident in Texas in which his arm was completely severed and subsequently reattached. The accident occurred on April 18, 1984, and the settlement agreement was entered into in January of 1988.

¶ 3. A check made payable to Wendell and Lisa individually and as husband and wife in the amount of $250,000 was received by Wendell and Lisa prior to the divorce on March 9, 1988. Reimbursements were made for costs advanced, worker's compensation benefits, and attorneys' fees. In addition to the lump sum payment, it was agreed that Wendell or his estate would receive monthly payments of $1,940.71 for thirty years, or the rest of his life if he lives longer than thirty years. Wendell or his estate is also guaranteed to receive eight specific lump sum payments in increasing amounts every four years until the year 2019.

¶ 4. The record, however, does not reflect any allocation of the settlement proceeds for the claims Wendell and Lisa each had. Both parties acknowledged the monthly payments and the eight lump sum payments were to be paid to Wendell or his estate. The chancellor found that the entire proceeds from the settlement were subject to equitable distribution and awarded Lisa forty percent of all monthly and future lump sum payments.

¶ 5. Wendell appealed, and argued, inter alia, that the chancery court erred in finding the entire proceeds of the personal injury settlement were marital assets which were subject to equitable distribution. The Court of Appeals found that the law has changed since we last visited the issue in Regan v. Regan, 507 So.2d 54 (Miss.1987), and reversed and remanded the case to the Chancery Court of Panola County to give the parties an opportunity to present evidence as to the amount of the settlement attributable to Wendell's claims and the amount of the settlement attributable to Lisa's claims.

ANALYSIS

¶ 6. "Our scope of review in domestic relations matters is limited under the familiar rule that this Court will not disturb a chancellor's findings unless manifestly wrong, clearly erroneous, or if the chancellor applied an erroneous legal standard." Johnson v. Johnson, 650 So.2d 1281, 1285 (Miss.1994) (citing McEwen v. McEwen, 631 So.2d 821, 823 (Miss.1994)).

¶ 7. In Regan v. Regan, 507 So.2d 54 (Miss.1987), the husband was injured while working on an offshore oil rig in the North Sea. The husband and wife received a $107,000 certificate of deposit as joint tenants as a result of the husband's work-related injury. The chancellor divided the certificate of deposit equally between the two parties, and on appeal the husband claimed it was error. Regan at 56.

¶ 8. This Court found:

There is no dispute that the origin of the funds reflected by the certificate of deposit was the settlement of Lloyd's maritime personal injury claim arising out of his work on an oil rig for Santa Fe Oil Company in the North Sea in September of 1978. The record contains a copy of a settlement draft dated August 14, 1981, issued by underwriters for Santa Fe Oil and payable to Lloyd Ray Regan, Jeanette Regan and their attorney, jointly and severally, in the amount of $225,000.00. There is no suggestion that Jeanette suffered any personal injuries. Rather, her name was on the check and she signed the release no doubt as a part of the custom and practice in the settlement of claims such as this that any possible claims of the wife be extinguished as a part of the settlement. Such claims, no doubt, are limited here to claims for loss of society or consortium.

Regan at 56. We further stated:

While it is true that the evidence suggests that a good bit of the settlement proceeds have been expended for the mutual benefit of the parties, there is no evidence that Lloyd ever made any gift of one-half or any other part of the proceeds to Jeanette. See May v. Summers, 328 So.2d 345, 347-48 (Miss.1976)

; Tucker v. Tucker, 252 Miss. 344, 358, 173 So.2d 405, 411 (1965). To the extent that the funds reflected by the certificate of deposit were in fact derived from the Lloyd's maritime personal injury claim, they are his property and may not be ordered shared with his wife as a part of a property division incident to divorce proceedings. See Amato v. Amato, 180 N.J.Super. 210, 434 A.2d 639, 641-44 (1981).

The Chancery Court erred when it ordered the certificate of deposit divided equally between the parties. Rather, the property division should have reflected, pro rata, the extent to which the settlement proceeds were fairly attributable to the respective claims of Lloyd and Jeanette.

Id. at 57.

¶ 9. In 1994, this Court completely transformed the law of property division in divorce proceedings in Hemsley v. Hemsley, 639 So.2d 909 (Miss.1994), and Ferguson v. Ferguson, 639 So.2d 921, 930 (Miss. 1994). In Hemsley, we held:

We define marital property for the purpose of divorce as being any and all property acquired or accumulated during the marriage. Assets so acquired or accumulated during the course of the marriage are marital assets and are subject to an equitable distribution by the chancellor. We assume for divorce purposes that the contributions and efforts of the marital partners, whether economic, domestic or otherwise are of equal value.

Hemsley, 639 So.2d at 915. We went on to say, "[i]n arriving at an equitable distribution the chancellor should follow those guidelines as set out in Ferguson v. Ferguson, 639 So.2d 921, decided July 7, 1994...." Id.

¶ 10. In Ferguson v. Ferguson, 639 So.2d 921 (Miss.1994), the Court set forth the current principles to be considered regarding the equitable distribution process.

[T]his Court directs the chancery courts to evaluate the division of marital assets by the following guidelines and to support their decisions with findings of fact and conclusions of law for purposes of appellate review. Although this listing is not exclusive, this Court suggests the chancery courts consider the following guidelines, where applicable, when attempting to effect an equitable division of marital property:

1. Substantial contribution to the accumulation of the property. Factors to be considered in determining contribution are as follows:

a. Direct or indirect economic contribution to the acquisition of the property;

b. Contribution to the stability and harmony of the marital and family relationships as measured by quality, quantity of time spent on family duties and duration of the marriage; and

c. Contribution to the education, training or other accomplishment bearing on the earning power of the spouse accumulating the assets.

2. The degree to which each spouse has expended, withdrawn or otherwise disposed of marital assets and any prior distribution of such assets by agreement, decree or otherwise.

3. The market value and the emotional value of the assets subject to distribution.

4. The value of assets not ordinarily, absent equitable factors to the contrary, subject to such distribution, such as property brought to the marriage by the parties and property acquired by inheritance or inter vivos gift by or to an individual spouse 5. Tax and other economic consequences, and contractual or legal consequences to third parties, of the proposed distribution;

6. The extent to which property division may, with equity to both parties, be utilized to eliminate periodic payments and other potential sources of future friction between the parties;

7. The needs of the parties for financial security with due regard to the combination of assets, income and earning capacity; and,

8. Any other factor which in equity should be considered.

Ferguson at 928.

¶ 11. In Johnson v. Johnson, 650 So.2d 1281(Miss.1994), this Court explained the application of Hemsley and Ferguson.

Division of marital assets is now governed under the law as stated in Hemsley and Ferguson. First, the character of the parties' assets, i.e., marital or nonmarital, must be determined pursuant to Hemsley. The marital property is then equitably divided, employing the Ferguson factors as guidelines, in light of each parties' nonmarital property. Ferguson, 639 So.2d at 928. If there are sufficient marital assets which, when equitably divided and considered with each spouse's nonmarital assets, will adequately provide for both parties, no more need be done. If the situation is such that an equitable division of marital property, considered with each party's nonmarital assets, leaves a deficit for one party, then alimony based on the value of nonmarital assets should be considered. This process does not require divestiture of inherited or giftacquired nonmarital property.

Johnson at 1287 (footnote omitted).

¶ 12. In Marsh v. Marsh, 313 S.C. 42, 437 S.E.2d 34 (1993), the South Carolina Supreme Court was faced with the very same question before us now. In...