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Seifert v. Seifert

Court of Appeals of Tennessee, Knoxville

May 17, 2017

PHILLIPJAY SEIFERT
v.
MARIA COVENY SEIFERT

          Session January 25, 2017

         Appeal from the Chancery Court for Knox County No. 186118-3 Michael W. Moyers, Chancellor.

         The principal issues in this divorce action arise from the parties' antenuptial agreement. The trial court declared the parties divorced, classified the bulk of the assets as Husband's separate property, divided the modest amount of assets that were classified as marital property, and awarded Wife alimony in futuro of $8, 000 per month and alimony in solido of $500, 000. Both parties appeal. Wife contends the court erred in classifying the bulk of the assets as Husband's separate property and that the alimony awarded to her is insufficient. She also requests an award of attorney fees incurred on appeal. Husband contends that all of the income he earned during the marriage is his separate property, that all assets he acquired with that income is his separate property, and that the antenuptial agreement prohibited the trial court from considering the value of his separate property in awarding alimony to Wife. We affirm the trial court in all respects. We also find that Wife is entitled to recover reasonable and necessary attorney fees incurred on appeal.

         Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed.

          Ronald J. Attanasio, Knoxville, Tennessee, for the appellant, Phillip Jay Seifert.

          L. Caesar Stair, III and C. Scott Taylor, Knoxville, Tennessee, for the appellee, Maria Coveny Seifert.

          Frank G. Clement, Jr., P.J., M.S., delivered the opinion of the Court, in which D. Michael Swiney, C.J., and Thomas R. Frierson, II, J., joined.

          OPINION

          FRANK G. CLEMENT, JR., P.J., M.S.

         Phillip Jay Seifert ("Husband") and Maria Coveny Seifert ("Wife") married in August 1997. A few days prior to the marriage, the parties entered into an agreement designed to handle the disposition of the parties' property in the event of divorce ("Antenuptial Agreement" or "Agreement").

         At the time of the marriage, Husband was in his early thirties and Wife was in her early forties. Husband had an established medical practice as an emergency room physician, and Wife, who held an associate's degree, had established her career as a registered nurse. Husband continued to work as an emergency room physician throughout the marriage and earned an annual income ranging from $350, 000 to $550, 000 (approximately $29, 166 to $45, 833 per month). Wife worked as a registered nurse until sometime in 2000 or 2001, at which time she became a homemaker and the primary caretaker of the parties' children, born in 1997 and 1999.

         After nearly sixteen years of marriage, Husband filed for divorce. In his complaint, Husband sought a divorce, to be named the primary residential parent of their two minor children, and an equitable division of the marital property in the event that the parties did not enter into a Marital Dissolution Agreement. Husband filed an amended complaint requesting enforcement of the Antenuptial Agreement in the event that the parties did not enter into a Marital Dissolution Agreement. Wife filed an answer and counter-complaint for divorce challenging the validity and enforceability of the Agreement. Wife also sought to be designated primary residential parent of the children, alimony, an equitable division of the marital estate, and payment of her attorney fees and litigation expenses.

         The trial court held a bifurcated hearing on the issue of the validity and enforceability of the Antenuptial Agreement on July 29 and 30, 2015. Following the hearing, the trial court rendered its opinion finding the Agreement to be valid and enforceable. Neither party challenges this finding on appeal.

         Almost a year later, the underlying divorce action was tried over two days in June 2016. At the conclusion of the trial, the court ordered the parties divorced pursuant to Tenn. Code Ann. § 36-4-129. When the divorce was granted, Wife was in her early sixties, Husband was in his early fifties, and both parties were in good health. Their oldest child had reached the age of majority, and their youngest child was seventeen years old.[1] In ruling from the bench, the trial court adopted Mother's proposed parenting plan verbatim, finding it to be in the child's best interest. The parenting plan, as adopted by the court, designated the primary residential parent as "Mother when the children are with her, and Father when the children are with him." The plan also provided equal parenting time and directed that major decisions regarding the child be made jointly.

         In dividing the martial estate, the trial court first looked to the Antenuptial Agreement for guidance as to classification of the separate and marital property of the parties. The court determined that the language and intent of the agreement was to categorize all property acquired after marriage, including personal services income acquired after the marriage, as separate property, unless the property was acquired jointly or titled in both of their names. Based on its interpretation of the Antenuptial Agreement, the trial court found that Husband had a separate estate valued at approximately $3.5 to $4 million. Husband's separate assets included, inter alia, the marital residence, an Oppenheimer Retirement Fund, and an Oppenheimer investment account, all of which were acquired after the marriage with Husband's income and titled solely in Husband's name. The trial court found that Wife had a separate estate valued at approximately $54, 352, which included, inter alia, her pension, jewelry, and household furnishings.

         With respect to marital property, the trial court recognized that there was a "limited marital estate to be distributed because of the result of the prenuptial agreement[.]" In addition to disputed household furnishings and contents, the court found two marital assets to be divided: the parties' vacation home in Florida (equity valued at $200, 000) and a stock account with Johnson Controls (valued at $64, 029). The court awarded both marital assets to Husband but ordered him to pay Wife $100, 000 as her share of the equity in the vacation home and to transfer one-half of the value of the stock to Wife as her share.

         As for spousal support, the trial court found that its ability to assess alimony or support was not limited in any way by the Antenuptial Agreement. After considering the relevant statutory factors, the trial court awarded Wife alimony in futuro of $8, 000 per month and alimony in solido of $500, 000. In issuing its award of alimony, the trial court found that Wife was not capable of rehabilitation, considering, inter alia, the fact that she "became a homemaker" and "did not have the opportunity to acquire the sorts of assets that [Husband] did during the life of the marriage, " and "even had she worked, at the very best her income would have been . . . a tint [sic: tenth] of what [Husband] makes." The trial court stated that its alimony award would allow Wife to purchase a home and live comfortably for the remainder of her life. Moreover, in response to a request for a separate hearing on attorney fees, the court stated that it intended for its award of alimony in solido "to cover [Wife's] attorneys fees along with her other debts, " but that "she can do with it whatever she likes . . . ." Thus, the trial court stated that "there [wouldn't] be any necessity for a separate hearing on attorneys fees."

         The Final Judgment for Divorce reflecting the trial court's decision and incorporating by reference the transcript of its ruling from the bench for its findings of fact and conclusions of law was entered on June 29, 2016. Thereafter, Husband filed a Motion for Relief Pending Appeal requesting an order suspending the relief ordered by the trial court in the Final Judgment for Divorce. The trial court granted Husband's motion as to the award of alimony in solido of $500, 000 and the division of the Johnson Controls stock, but it denied Husband's motion as to the award of alimony in futuro and the award of Wife's share of the equity in the vacation home. Husband timely perfected this appeal.

         Standard of Review

         "In all actions tried upon the facts without a jury, the court shall find the facts specially and shall state separately its conclusions of law and direct the entry of the appropriate judgment." Tenn. R. Civ. P. 52.01. If the trial court makes the required findings of fact, appellate courts review the trial court's factual findings de novo upon the record, accompanied by a presumption of the correctness of the findings, unless the preponderance of the evidence is otherwise. Kelly v. Kelly, 445 S.W.3d 685, 692 (Tenn. 2014) (citing Tenn. R. App. P. 13(d)). "For the evidence to preponderate against a trial court's finding of fact, it must support another finding of fact with greater convincing effect." State ex rel. Flowers v. Tenn. Trucking Ass'n Self Ins. Grp. Trust, 209 S.W.3d 595, 598-99 (Tenn. Ct. App. 2006) (citations omitted).

Requiring trial courts to make findings of fact and conclusions of law is generally viewed by courts as serving three purposes. First, findings and conclusions facilitate appellate review by affording a reviewing court a clear understanding of the basis of a trial court's decision. Second, findings and conclusions also serve "to make definite precisely what is being decided by the case in order to apply the doctrines of estoppel and res judicata in future cases and promote confidence in the trial judge's decision-making." A third function served by the requirement is "to evoke care on the part of the trial judge in ascertaining and applying the facts." Indeed, by clearly expressing the reasons for its decision, the trial court may well decrease the likelihood of an appeal.

Lovlace v. Copley, 418 S.W.3d 1, 34-35 (Tenn. 2013) (internal citations and footnotes omitted).

         While there is no bright-line test by which to assess the sufficiency of the trial court's factual findings, the general rule is that "the findings of fact must include as much of the subsidiary facts as is necessary to disclose to the reviewing court the steps by which the trial court reached its ultimate conclusion on each factual issue." Id. at 35. "Simply stating the trial court's decision, without more, does not fulfill [the Rule 52.01] mandate." Gooding v. Gooding, 477 S.W.3d 774, 782 (Tenn. Ct. App. 2015) (quoting Barnes v. Barnes, No. M2011-01824-COA-R3-CV, 2012 WL 5266382, at *8 (Tenn. Ct. App. Oct. 24, 2012)).

         If the trial court fails to explain the factual basis for its decisions, the appellate court "may conduct a de novo review of the record to determine where the preponderance of the evidence lies or remand the case with instructions to make the requisite findings of fact and conclusions of law and enter judgment accordingly." Id. at 783 (citing Lovlace, 418 S.W.3d at 36; Ganzevoort v. Russell, 949 S.W.2d 293, 296 (Tenn. 1997); Nashville Ford Tractor, Inc. v. Great Am. Ins. Co., 194 S.W.3d 415, 424 (Tenn. Ct. App. 2005)).

         Our review of a trial court's determinations on issues of law is de novo, without any presumption of correctness. Lind v. Beaman Dodge, Inc., 356 S.W.3d 889, 895 (Tenn. 2011).

         Analysis

         Husband presents thirteen "issues" for our review, some of which are not appropriate for this court to consider in that they are argumentative and non-justiciable contentions. Therefore, we decline to track the issues as stated by Husband, and instead, we consolidate and restate the issues that are appropriate for our consideration as follows:

1) Whether the trial court divided the marital property, specifically the household furnishings and contents, in accordance with the Antenuptial Agreement.
2) Whether the trial court erred in interpreting the Antenuptial Agreement and, thus, erred in considering the separate property of Husband for purposes of determining an award of alimony.
3) Whether the trial court erred in its award of alimony to Wife.
4) Whether the trial court erred in its adoption of Wife's permanent parenting plan.
5) Whether Husband was entitled to a separate hearing on the attorney fees claimed by Wife.
6) Whether Husband was entitled to a stay of execution on Wife's award of alimony in futuro.

         Wife presents three additional issues for our review. We restate Wife's issues as follows:

1) Whether the trial court erred in interpreting the Antenuptial Agreement and, thus, erred in classifying the separate and marital property of the parties.
2) Whether the trial court erred by failing to award Wife an additional amount of alimony in solido to cover her debts of approximately $126, 180; her attorney fees as of April 22, 2016, in the amount of $83, 085; and additional attorney fees incurred by Wife from April 22 to July 1, 2016.
3) Whether Wife is entitled to an award of attorney fees and litigation expenses on appeal.

         For ease of analysis, we will address the issues in the following categories: (1) the disposition of property; (2) alimony; (3) the permanent parenting plan; and (4) other matters.

         I. Disposition of Property

         Wife challenges the trial court's classification of the parties' separate and marital property, and Husband challenges the division of the household furnishings. The resolution of these issues is controlled by the parties' Antenuptial Agreement.

         A. Antenuptial Agreement

         It is well-settled that parties may control the disposition of property upon divorce by way of a valid antenuptial agreement. Tenn. Code Ann. § 36-3-501 (2001); Kahn v. Kahn, 756 S.W.2d 685, 694 (Tenn. 1988). Antenuptial agreements are valid and enforceable in this state as long as they are entered into freely, knowingly, and without duress or undue influence. Perkinson v. Perkinson, 802 S.W.2d 600, 603 (Tenn. 1990). Where an antenuptial agreement is valid and enforceable, having been shown to meet the prerequisites, the terms of that agreement regarding distribution of property upon divorce will be applied instead of the statutory definitions of marital and separate property or general principles regarding an equitable distribution. Id. at 603-04.

         A valid antenuptial agreement is the same as any other contract and should be interpreted using principles of construction that apply to other written agreements. Wilson v. Moore, 929 S.W.2d 367, 373 (Tenn. Ct. App. 1996). In construing a contract, courts should seek to identify the intent of the parties as set forth in the language of the contract. City of Cookeville ex rel. Cookeville Reg'l Med. Ctr. v. Humphrey, 126 S.W.3d 897, 904 (Tenn. 2004); Wilson, 929 S.W.2d at 373. Because antenuptial agreements are favored by public policy, they are construed liberally to give effect to the intention of the parties. Sanders v. Sanders, 288 S.W.2d 473, 477 (Tenn. Ct. App. 1955). In general, the provisions of a contract must be examined in the context of the entire agreement. Wilson, 929 S.W.2d at 373. Contractual terms should be given their plain, ordinary meaning and "should be construed harmoniously to give effect to all provisions and to avoid creating internal conflicts." Id. With respect to antenuptial agreements, the substance of the parties' intent will prevail over the form of the instrument, and the agreement "will not be held invalid for technical or trifling reasons." Sanders, 288 S.W.2d at 478.

         The interpretation of a contract is a question of law. Guiliano v. CLEO, Inc., 995 S.W.2d 88, 95 (Tenn. 1999). Therefore, the trial court's interpretation of a contractual document is not entitled to a presumption of correctness on appeal. Id.; Angus v. W. Heritage Ins. Co., 48 S.W.3d 728, 730 (Tenn. Ct. App. 2000). This court must review the documents ourselves and make our own determination regarding their meaning and legal import. Hillsboro Plaza Enters. v. Moon, 860 S.W.2d 45, 47 (Tenn. Ct. App. 1993).

         Because the trial court's holding that the Antenuptial Agreement between the parties was enforceable has not been appealed, our task is to enforce the terms of the Agreement in light of the facts in the record. The provisions of the Antenuptial Agreement that are relevant to the issues raised on appeal read as follows:

[Seventh Recital] WHEREAS, each of the parties has been advised that any property he or she may own at the time of the marriage would constitute "separate property"; separate property is defined as property acquired before marriage or property acquired either before or after marriage by bequest, devise, descent, or gift from a party other than the spouse, compensation for personal injuries and property acquired in exchange for or the increase in value of separate property, except to the extent that such appreciation is due in part to the contributions or efforts of the other spouse or as the parties may agree in writing; and
[Eighth Recital] WHEREAS, each party desires to keep all of his or her separate property, whether now owned or hereafter acquired, including any property either now owned or acquired after the date of the marriage, in his or her own name or with any person, firm or corporation other than his or her spouse, regardless of whether said property would be deemed "marital property" pursuant to any law, from any claim of the other by virtue of the forthcoming marriage; and
[Ninth Recital] WHEREAS, each party desires to keep all of his or her separate property, whether now owned or hereafter acquired, including any property either now owned or acquired after the date of the marriage, in his or her own name or with any person, firm or corporation other than his or her spouse, regardless of whether said property would be deemed "marital property" pursuant to any law, from any claim of the other by virtue of the forthcoming marriage; . . .
. . . .
3. PROPERTY RIGHTS. The parties agree that after the marriage, in the event of a subsequent legal separation or divorce between the parties, the property presently owned by each of them shall be disposed of in accordance with the following provisions of this paragraph:
a. Any property presently owned by either of the parties shall be deemed his or her separate property. All separate property, as defined in this Agreement, shall be eliminated from consideration by the courts of this or any other state or jurisdiction in the event of any ...

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