Where Do the Children’s Vehicles Go?
August 28, 2013 § 4 Comments
The parties have complied with the court’s order to produce at trial a consolidated list of all the marital assets. There, among all the end tables, pots, pans, what-nots, and nick-nacks, is the 1994 Honda auto — worth $15,275 — that was purchased for the daughter to transport herself to and from college. Husband says wife should get it in equitable distribution, and wife says husband should get it. Whoever winds up with it gets a $15,275 bump in the asset column.
Those were the essential facts in the COA case of Terrell v. Terrell, decided July 16, 2013.
In that case, Robert Terrell had purchased the car for his daughter, Catherine, titled it in her name, and transferred ownership to her. The chancellor nonetheless included the vehicle in wife Mary Terrell’s share of equitable distribution. Mary appealed, arguing that the asset value of the car erroneously inflated her allocation of the marital estate.
The COA agreed with Mary, reversing and rendering:
¶17. We agree that the vehicle should not have been deemed a part of the marital estate. While it was purchased during the course of the marriage, it is not marital property, nor is it separate property. Rather, it was a gift from Robert and Mary to Catherine, who was a third-party recipient. Catherine has retained physical custody of the vehicle and has been the legal title holder of the vehicle since it was purchased. It was not an asset of Robert or Mary either jointly or separately. Accordingly, we reverse and render this issue specifically for the elimination of Catherine’s automobile from the marital estate.
The outcome here is pretty clear, but there are all kinds of permutations of this fact scenario, in my experience. Robert could have kept the car titled in his name, for insurance purposes. Or the car could have been titled in Mary for the same reason. Some parents want the car titled in either or both names solely as a control mechanism. Sometimes the car is titled in one parent’s name until the child pays some consideration for it. The possibilities are limited only by one’s imagination.
I have put the child’s auto in the column of a parent who testified that he had the car titled in his name, and did not know whether he would continue to provide the child with a vehicle. It seems to me that where the car goes depends on the particular facts of the case. In general, however, I think it’s safe to say that if the car is clearly going to stay with the child, it should be kept out of equitable distribution, and if it is really only a chattel that a parent is going to exercise control over, it should go with that parent.
I do the same with the children’s furniture and moveables.
One final point. There is plenty of case law that says if one part of the determination of assets-equitable distribution-alimony triangle is disturbed, the chancellor must look at it again and redo the whole ball of wax. Here, the appeal result is to reduce Mary’s distribution by $15,275, a not inconsiderable chunk of change. I just wonder why this was rendered and not remanded.
Thank you for the clarification and also for taking time to do what you do. You have greatly improved my practice, and I advise all new lawyers to read your blog. If Debbie Bell is the mother of Mississippi family lawyers, you are certainly our father.
Just to clarify as to children’s furniture: In dividing children’s furniture, the furniture should be charged against the parent who takes it. If the children are young, the parent who is not awarded the furniture will likely face having to purchase furniture for the children to have during visitation. Was that your point? That’s the way that I’ve treated that issue in the past during negotiations for property division.
My point was that, where the parent will leave the asset with the child, and will not exercise control such as selling it or taking it back, the asset should be neutral. Cars can beused to control a child. E.g., good grades = car; bad grades = no car.
Asset values are fair market value, which posits that they can or may be sold. A parent may take a car away from a child and sell it, which in this case wold have produced $15,000 or so in cash. Since that was quite unlikely in this case, the chancellor should not have assigned that value to the wife who likely would not sell it.
With children’s furniture, it’s rare that it is used in quite that manner, although if you read Hamby v. Hamby, a COA case decided December 4, 2012, that kind of behavior did occur. The children usually get use of the furniture as long as they are in the home.
The value of most children’s items is minimal. If it will not create toomuch distortion in the equitable distribution, I award it and its value to the parent who will have charge of it. If the furniture has significant value, it should be studied more closely. What is the likelihood it will be turned into cash? If nil, it should probably be neutral.