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Long v. Long

Court of Appeals of Tennessee, Knoxville

August 23, 2019


          Session: May 21, 2019

          Appeal from the Probate and Family Court for Cumberland County No. 2014-PF-4162 Larry M. Warner, Judge

         This divorce case involves the trial court's classification and division of the separate and marital property of the parties. The trial court did not place a valuation on any of the property that was contested, nor did it refer to or make any findings regarding the factors provided by the governing statute, Tenn. Code Ann. § 36-4-121 (2017). We vacate the trial court's order and remand with instructions to make sufficient findings of fact and conclusions of law as required by Tenn. R. Civ. P. 52.01.

         Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Probate and Family Court Vacated; Case Remanded

          G. Earl Patton, Crossville, Tennessee, for the appellant, Carolyn Diane Long.

          Jason F. Hicks, Cookeville, Tennessee, for the appellee, Steven Lawrence Long.

          Charles D. Susano, Jr., J., delivered the opinion of the court, in which John W. McClarty and Thomas R. Frierson, II, JJ., joined.




         Carolyn Diane Long (wife) and Steven Lawrence Long (husband) were married for the first time in 1984. Following a divorce a year later, they remarried in 1987. Wife's family was involved in real estate development and investment. In 1993, wife's mother and stepfather created and funded a partnership entity known as "Pioneer Properties." The partners were wife, her brother, sister, two stepbrothers, and her stepfather. Wife testified that the primary activity of Pioneer Properties was "buying land, subdividing it, and then selling it." It is undisputed that neither husband nor wife contributed any funds to Pioneer Properties. When wife received distributions from the partnership, she deposited them into an account jointly held by the parties.

         In 1988, while they were married, the parties acquired a property on George Smith Road. At that time, they were contemplating divorce and, according to wife, they "were separated for a long time." Wife intended to move into the house on George Smith Road and live in it by herself. Husband executed a deed quitclaiming his interest in the George Smith Road property to wife in 1988. The parties reconciled and lived together in the house for several years. Later, they moved to another house and rented the George Smith Road property.

         On October 31, 2014, wife filed her complaint for divorce. The only issues contested were the classification of two assets ‒ wife's interest in Pioneer Properties and the George Smith Road property ‒ and the division of the marital estate. By agreement, the trial was bifurcated. At the first hearing on March 10, 2017, the trial court was asked to decide whether the two contested assets were marital or wife's separate property. The parties agreed that the interests held by wife in three other business entities, Pioneer Realty, Inc., Robinson Properties Family LP, and RLW Properties, were her separate property. No value for these three assets was presented to the trial court, and it did not find or set a value for any of them.

         The only witnesses at the relatively brief first hearing were husband and wife. Wife argued that, notwithstanding the fact that the two contested assets were acquired during the course of the marriage, they were gifts to her and should be classified as her separate property. Husband argued that he made substantial contributions to the preservation and appreciation of the assets, and therefore their increase in value during the marriage should be classified as marital property. Additionally and in the alternative, husband argued that the assets were converted to marital property by operation of the doctrines of commingling and transmutation.

         The only factual findings pertaining to the disputed assets in the trial court's order following the first hearing are as follows:

That with regard to the home and real property on George Smith Road, in Cumberland County, titled solely in the name of the [wife]: The [husband] conveyed his interest in said real property to the [wife], by quitclaim deed in 1988; and the parties further exhibited an intent throughout the marriage that said real property would remain the [wife's] sole and separate property.
That with regard to the parties' interest in the partnership entity known as Pioneer Properties: This entity was a more fluid asset, with properties being bought and sold at various times throughout the marriage. The Court finds that this entity is marital property due to the fluidity of the asset and due to the fact that proceeds were regularly deposited from said partnership into a joint account of the parties.

(Numbering in original omitted).

         The second hearing took place on August 17, 2018. The trial court heard testimony from the parties and a real estate appraiser. The parties agreed on the values of many, but not all, of the numerous marital real estate assets. The only factual findings contained in the trial court's final judgment state as follows:

That for at least 27 years of this 31 year marriage the wife treated all of the property the parties collectively owned as if it were owned equally by her and husband and that all of their property should now be divided equally.
Pioneer Properties is a real estate investment business owned and run by wife and her family, and it would not be feasible for husband to continue in that business relationship after the divorce.

(Numbering in original omitted).

         The trial court awarded wife the entire interest in Pioneer Properties. Wife estimated the value of this asset to be $311, 295.81. It does not appear from the record that husband proffered a written estimated value of the Pioneer Properties interest. During the second hearing, husband's counsel argued that the value of wife's interest was $429, 527.50. To offset this award, the court awarded husband apartments on Old Mail Road that the parties agreed were worth $300, 000; two parcels of land on Woodlawn Road worth $90, 000, and a parcel on Rockledge Drive worth $3, 000. The trial court further ordered several other real estate holdings to be sold and the proceeds split equally. The marital residence was ordered to be sold and the proceeds equally divided after payment of debts associated with the residence. The parties did not agree on the value of all these assets, including the marital residence. As noted, the trial court made no findings of fact regarding the value of any asset of the marital or separate estates. Consequently, it is difficult to state an accounting of the division of the assets with any certainty. As appendices to her brief, wife submits two charts showing her argument as to the division according to her values, and according to husband's. Using wife's values, she states that she was awarded property worth $622, 147.08, and husband awarded property worth $641, 851.27. Using husband's values, wife states that the property was divided $659, 109.58 to her, and $678, 813.77 to husband. Wife timely filed a notice of appeal.


         Wife raises these issues:

Whether the trial court erred in classifying her interest in the Pioneer Properties partnership as marital property.
Whether the trial court failed to make sufficient findings of fact and conclusions of law as required by Tenn. R. Civ. P. 52.01.

         Husband raises the following additional issue:

Whether the trial court erred in classifying the George Smith Road property as wife's separate property.


         This Court has set forth the standard of review of a trial court's division of marital property as follows:

Once the marital property has been valued, the trial court is to divide the marital property in an equitable manner. Tenn. Code Ann. § 36-4-121(a)(1); Miller [v. Miller], 81 S.W.3d [771, ] at 775 [(Tenn. Ct. App. 2001)]. A division of marital property in an equitable manner does not require that the property be divided equally. Robertson v. Robertson, 76 S.W.3d 337, 341 (Tenn. 2002). Dividing a marital estate is not a mechanical process but, rather, is guided by considering the factors in Tenn. Code Ann. § 36-4-121(c). Kinard [v. Kinard], 986 S.W.2d [220, ] at 230 [Tenn. Ct. App. 1998]. . . . Trial courts have wide latitude in fashioning an equitable division of marital property, Fisher v. Fisher, 648 S.W.2d 244, 246 (Tenn. 1983), and this court accords great weight to the trial court's division of marital property. Wilson v. Moore, 929 S.W.2d 367, 372 (Tenn. Ct. App. 1996). Thus, we defer to the trial court's division of the marital estate unless it is inconsistent with the factors at Tenn. Code Ann. § 36-4-121(c) or is not supported by a preponderance of the evidence. Brown v. Brown, 913 S.W.2d 163, 168 (Tenn. Ct. App. 1994).

Luplow v. Luplow, 450 S.W.3d 105, 109-110 (Tenn. Ct. App. 2014). "However, we accord no presumption of correctness to the trial court's conclusions of law." Harper v. Harper, No. W2017-02193-COA-R3-CV, 2018 WL 5307090, at *1 (Tenn. Ct. App., filed Oct. 24, 2018), (citing Snodgrass v. Snodgrass, 295 S.W.3d 240, 245-46 (Tenn. 2009)).



         We first address the trial court's treatment of wife's interest in the Pioneer Properties partnership. As we have often noted, "a trial court must identify all of the assets possessed by the divorcing parties as either separate property or marital property before equitably dividing the marital estate." Mangum v. Mangum, No. E2018-00024-COA-R3-CV, 2019 WL 1787328, at *8 (Tenn. Ct. App., filed Apr. 24, 2019) (quoting McHugh v. McHugh, No. E2009-01391-COA-R3-CV, 2010 WL 1526140, at *3 (Tenn. Ct. App., filed Apr. 16, 2010)); Swafford v. Swafford, No. 2017-00095-COA-R3-CV 2018 WL 1410900, at *3 (Tenn. Ct. App., filed Mar. 21, 2018). Tenn. Code Ann. § 36-4-121(b) provides, in pertinent part, the following definitions of these terms:

(1)(A) "Marital property" means all real and personal property, both tangible and intangible, acquired by either or both spouses during the course of the marriage up to the date of the final divorce hearing and owned by either or both spouses as of the date of filing of a complaint for divorce, except in the case of fraudulent conveyance in anticipation of filing, and including any property to which a right was acquired up to the date of the final divorce ...

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