Reprise: 8.05’s are the Gold Standard of Financial Proof
January 29, 2016 § 2 Comments
Reprise replays posts from the past that you might find useful today.
8.05 FINANCIAL STATEMENTS: “THE GOLD STANDARD” OF PROOF
August 22, 2012 § 4 Comments
This just in: Rule 8.05 financial statements are the “gold standard” of financial proof in chancery court. That’s what Judge Fair said in the COA case of Collins v. Collins, decided August 21, 2012, beginning at ¶34:
This case highlights the role of the income and asset disclosures required by Rule 8.05 of the Uniform Chancery Court Rules. Rule 8.05 mandates prescribed forms for such disclosure and also requires:
(B) Copies of the preceding year’s Federal and State Income Tax returns, in full form as filed, or copies of W-2s if the return has not yet been filed.
(C) A general statement of the providing party describing employment history and earnings from the inception of the marriage or from the date of divorce, whichever is applicable.
¶35. Compliance with the rule is mandatory, for obvious reasons. If both parties put down identical values for marital property and properly disclose their income and expenses, supported by the required federal and state tax returns and earnings history, a court can adjudicate property and money issues expeditiously and in accord with the law. Noting the importance of Rule 8.05 disclosures, in Trim v. Trim, 33 So. 3d 471 (Miss. 2010), the supreme court has ruled that filing a substantially false Rule 8.05 financial disclosure statement constitutes fraud on the court.
¶36. Though there may be contrary misinterpretation of some decisions, which properly [fn 1] apply only when conflicts between forms conflict,1 Rule 8.05 disclosures should not be evidence of last resort. Rather, they should be the gold standard, requiring other evidence only when there are legitimate disputes as to valuation. [Emphasis added]
[fn 1] “Chancellors may rely on these statements to value property when the parties fail to offer any other evidence as to value.” Kimbrough v. Kimbrough, 76 So. 3d 715, 721 (¶28) (Miss. App. 2011) (quoting Studdard v. Studdard, 894 So. 2d 615, 618-19 (Miss. Ct. App. 2004)). “To the extent that further evidence would have aided the chancellor in [his] decision, the fault lies with the parties and not the chancellor.” Messer v. Messer, 850 So. 2d 161, 170 (¶43) (Miss. Ct. App. 2003).
Yes, 8.05’s are the gold standard of proof to a chancellor trying to root enough information out of the record to make a decision about equitable distribution and alimony. But some lawyers treat them like fool’s gold. Their 8.05’s do not include tax returns, figures are contradictory and incomplete, valuations are lacking, and there is no employment history.
In Collins, Mr. Collins included no tax returns, and he contradicted himself in his testimony, admitting that his 8.05 was incorrect and inaccurate. As a result, the chancellor relied on her own best judgment and calculated what she believed to be his income, resulting in an impressive $1,300 a month child support obligation.
The chancellor also accepted Ms. Collins’ valuations of real property in the absence of proof offered by Mr. Collins. Ouch.
Some parties offer tables of personal property with some pretty incredibe valuations. In one case I had the husband wanted the riding lawn mower, which he valued at $800. The wife — I am not kidding — valued it at $15,000. Husband testified that he had bought it several years before for $1,600 at Sears. I found his valuation more credible. What was the wife thinking when she tagged the item with that value? Did she think I’d bite on that? Where was her attorney when that table was prepared before trial.
Many lawyers and their clients adopt the extremely unhelpful tactic of valuing everything at near zero that they expect to get, and assigning astronomical values to everything the other party expects to get. For example, wife has the green couch, and she wants to keep it, so she values it at $50; husband opines that it is worth $2,750, and he does not want it. Give me a break.
Most people can not afford to hire a personal property appraiser to value their near-worthless pile of stuff. So lawyers toss it into the chancellor’s lap to flip a coin and make a call as to what the values might be. That’s a cop-out. Lawyers should be more professional than that.
If you try many financial-issue cases in chancery, I encourage you to read Collins. It’s the latest illustration of how parties shoot themselves painfully in the foot when they do a less-than-adequate job in prepping their 8.05’s, and it just might give you some ideas how an on-the-ball attorney can help his or her client avoid that kind of disaster.
Testamentary Capacity, Undue Influence, and the Burden of Proof
January 27, 2016 § 4 Comments
A will contest can present a bewildering forest of legal issues that can entangle the best lawyers. So, any time we can find some clarification, it’s worth taking a break to look it over.
In the COA case of Estate of Phelps: Terry et al. v. Phelps, et al., handed down December 8, 2015, the court dealt with an appeal from a classic will challenge based on a claim of both lack of testamentary capacity and undue influence.
The chancellor held that the testator, Dorothy Phelps, did have testamentary capacity. He also ruled that there was a confidential relationship between Dorothy and her son, Henry III, but that Henry had rebutted the presumption of undue influence by clear and convincing evidence. The contestants, Henry III’s siblings Irene Phelps Terry and Mary Phelps Domin, appealed.
The COA affirmed. Since this is a pretty useful recitation of the law, I am going to quote at length from the opinion. Judge Lee wrote for the court:
A. Testamentary Capacity
¶14. In their first issue, Irene and Vicki claim the chancellor erred in finding that Dorothy possessed testamentary capacity.
¶15. “For a will to be valid, the testator must possess testamentary capacity.” Noblin v. Burgess, 54 So. 3d 282, 291 (¶32) (Miss. Ct. App. 2010). “For testamentary capacity to be present, the testator must be of ‘sound and disposing mind’ at the time of the will’s execution.” Id. (quoting Miss. Code Ann. § 91-5-1 (Rev. 2004)). “At that time, the testator must: ‘understand and appreciate the nature and effect of his act of making a will, the natural objects or persons to receive his bounty and their relation to him, and be able to determine what disposition he desires to make of his property.’” Id. (quoting In re Estate of Mask, 703 So. 2d 852, 856 (¶17) (Miss. 1997)).
¶16. Our supreme court has explained the burden of proof on the issue of testamentary capacity is as follows:
At trial, the will’s proponents carry the burden of proof, which they meet by the offering and receipt into evidence of the will and the record of probate. A prima facie case is made by the proponent solely by this proof. Afterwards, although the burden of proof remains on the proponents, the burden of going forward with proof of testamentary incapacity shifts to the contestants, who must overcome the prima facie case. The proponents may then present rebuttal proof if necessary. In short, the proponents must prove the testator’s testamentary capacity by a preponderance of the evidence.
In re Estate of Rutland, 24 So. 3d 347, 351 (¶10) (Miss. Ct. App. 2009) (quoting In re Estate of Edwards, 520 So. 2d 1370, 1372 (Miss. 1988)).
¶17. In the instant case, an objection to probate was entered prior to the will being admitted to probate.
¶18. Henry III made his prima facie case of the will’s validity through the testimony of Kay Ousley Hyer, Cordell’s [the lawyer who prepared the will] legal secretary at the time Dorothy’s will was executed. Although Hyer had no recollection of the events on February 10, 1988, Hyer testified that she would not have signed the will’s attestation clause if she felt, through her interactions with Dorothy on February 10, 1988, that Dorothy was not of sound and disposing mind and memory. When asked whether Cordell would have signed the attestation clause, Hyer stated: “He would not have affixed his signature if [Dorothy was] not of sound mind and body.”
¶19. To support their argument on this issue, both Irene and Vicki testified that Dorothy lacked testamentary capacity because of her grief over Henry II’s death and because of other medical issues.
¶20. However, “[t]he mere fact that someone is too ill to handle his affairs does not in and of itself render him . . . void of testamentary capacity.” In re Estate of Laughter, 23 So. 3d 1055, 1061 (¶22) (Miss. 2009). Furthermore, we recognize that “[t]he testimony of subscribing witnesses receives greater weight than the testimony of witnesses who were not present at the will’s execution.” In re Estate of McQueen, 918 So. 2d 864, 871 (¶30) (Miss. Ct. App. 2005) (citing Edwards, 520 So. 2d at 1373). Therefore, Hyer’s testimony is given more weight than the testimony of Irene and Vicki, who were not present at the will’s execution, did not interact with Dorothy on February 10, 1988, and have an interest in the outcome of this case.
¶21. Even if Irene and Vicki presented sufficient evidence to overcome Henry III’s prima facie case, we note that Henry III presented rebuttal evidence through the testimony of Flora Collins. Collins worked for Dorothy for approximately twenty-six years and interacted with Dorothy on an almost daily basis. Collins stated that Dorothy appeared to be herself, “like she’s always been,” after returning home from the hospital. Collins also stated that Dorothy told her about the will on two separate occasions: “She told me that I have a will and they’re going to be surprised who I’m going to leave everything to.” Additionally, we note that the will appears reflective of Dorothy’s intent in prior codicils. This issue is without merit.
B. Undue Influence
¶22. In their second issue, Irene and Vicki claim Henry III did not present sufficient evidence to overcome the presumption of undue influence.
1. Presumption of Undue Influence
¶23. A presumption of undue influence arises where: (1) a confidential relationship existed between the testator and a beneficiary, and (2) there existed suspicious circumstances—such as the testator’s mental infirmity—or the beneficiary in the confidential relationship was actively involved in some way with preparing or executing the will. In re Last Will & Testament of Bowling, 155 So. 3d 907, 910-11 (¶16) (Miss. Ct. App. 2014) (citing Croft v. Alder, 237 Miss. 713, 115 So. 2d 683, 688 (1959)).
¶24. It is conceded that there was a confidential relationship between Dorothy and Henry III. However, the fact, alone, that a confidential relationship existed between Henry III and Dorothy is not sufficient to give rise to the presumption of undue influence. See In re Estate of Grantham, 609 So. 2d 1220, 1224 (Miss. 1992).
¶25. Nevertheless, in In re Estate of Harris, 539 So. 2d 1040 (Miss. 1989), our supreme court held that the presumption was raised with very little besides a confidential relationship. In re Last Will & Testament of Smith, 722 So. 2d 606, 612 (¶18) (Miss. 1998). In Harris, “the beneficiary simply found an attorney at the testator’s request and drove the testator to the attorney’s office.” Id.
¶26. The facts in the instant case are distinguishable from those in Harris. Henry III did not contact the attorney prior to the execution of the will. Nor did Henry III have knowledge that he was driving Dorothy to Hollandale for the purpose of executing a will. Henry III merely drove Dorothy to Hollandale on February 10, 1988, so she could “tend to some business.”
¶27. Furthermore, Henry III was not present during the execution of the will. Hyer testified as to Cordell’s usual practice with respect to allowing other people in the room during the execution of a will. Hyer stated: “I cannot recall a time that he would do that. It was always just the individual . . . It would be just between [Cordell and] that individual.”
¶28. In finding a presumption of undue influence, the chancellor noted Dorothy’s health and age. The chancellor also noted that after the will’s execution, the will was placed in a safety deposit box in both Dorothy and Henry III’s names; therefore, Henry III had the opportunity to view the will after its execution. The circumstances listed by the chancellor had nothing to do with the preparation and execution of the will or with Dorothy’s independent action.
¶29. The fact, alone, that a confidential relationship existed between Henry III and Dorothy is not sufficient to give rise to the presumption of undue influence. See Grantham, 609 So.2d at 1224. Henry III was not actively involved in preparing or executing the will, nor were there suspicious circumstances that negate independent action. See Dean v. Kavanaugh, 920 So. 2d 528, 537 (¶46) (Miss. Ct. App. 2006). As such, the chancellor erred in finding that there was a presumption of undue influence. However, because we ultimately reach the same conclusion, this issue is without merit.
2. Overcoming the Presumption of Undue Influence
¶30. Even if there was a presumption of undue influence, Henry III presented sufficient evidence to overcome such a presumption.
¶31. Our supreme court has stated that:
[T]he presumption of undue influence is overcome if the beneficiary has proven by clear and convincing evidence:
(1) Good faith on the part of the beneficiary;
(2) the testator’s full knowledge and deliberation of his actions and their consequences; and
(3) independent consent and action on the part of the testator.
Grantham, 609 So. 2d at 1224 (citing Mullins v. Ratcliff, 515 So. 2d 1183 (Miss. 1987)).
¶32. In the instant case, the record contains sufficient evidence to satisfy each of these three prongs. With respect to the good-faith requirement, the chancellor considered the following factors: (a) the identity of the initiating party seeking preparation of the will; (b) the place of the execution of the will and in whose presence; (c) the fee paid; (d) by whom it was paid; and (e) the secrecy or openness surrounding the execution of the will. In re Estate of Holmes, 961 So. 2d 674, 682 (¶25) (Miss. 2007). The chancellor found that Dorothy initiated the preparation of the will, the terms of the will were discussed between Dorothy and Cordell outside the presence of others, and the will was executed before two attesting witnesses.[Fn 3] Although there was no evidence of the fee paid or who paid the fee, we agree there was clear and convincing evidence that Henry III acted in good faith.
[Fn3] See Rogers v. Pleasant, 729 So. 2d 192, 194 (¶9) (Miss. 1998).
¶33. With respect to the second requirement—that Dorothy had full knowledge and deliberation of the consequences of her actions—the chancellor considered the following factors: (a) whether Dorothy was aware of her total assets and their worth; (b) whether Dorothy understood who her natural inheritors were and how her action would legally affect prior wills; (c) whether Dorothy knew nonrelative beneficiaries would be included or excluded; and (d) whether Dorothy knew who controlled her finances and how dependent Dorothy was on anyone handling her finances. Holmes, 961 So. 2d at 684 (¶39). The chancellor found that the will gave each daughter not only a life estate in 320 acres of land but also exclusive control and possession of the income generated by that land, which was evidence that Dorothy was aware of her total assets. The chancellor also found that the revocation clause along with specific devises and bequests in the will was evidence that Dorothy understood who her natural inheritors were and how her action would legally affect prior wills. It is clear from prior documents that Dorothy never had any intention of including nonrelative beneficiaries. Finally, the chancellor found that there was evidence that Dorothy knew who controlled her finances. We agree there was clear and convincing evidence that Dorothy had full knowledge and deliberation of the consequences of her actions.
¶34. With respect to the last requirement, the chancellor found that Dorothy exhibited independent consent and action when she obtained independent advice from Cordell, who was a competent person, disconnected from Henry III, and devoted wholly to Dorothy’s interests. Holmes, 961 So. 2d at 680 (¶18). We agree there was clear and convincing evidence that Dorothy exhibited independent consent and action.
¶35. Assuming there was a presumption of undue influence, the presumption was overcome by clear and convincing evidence that Henry III acted in good faith, Dorothy had full knowledge and deliberation of the consequences of her actions, and Dorothy exhibited independent consent and action when she executed her will. This issue is without merit.
Some comments on this case next week.
A CD Pitfall
January 26, 2016 § 5 Comments
A 2015 COA case reveals a feature of CD’s that could cause problems for some of your clients, and could impact estates you handle.
In 1990, Audie Bell English and several other relatives purchased a $75,000 CD at Sunburst Bank, which later was acquired by Regions Bank. The CD automatically renewed every 6 months at the then-prevailing rate. Under its terms, any of the purchasers could cash out the CD without participation of the others, but to do so the original CD was required to be presented. There was a policy in place, however, for issuance of a replacement original in the event that the initial original certificate became lost.
All of the other purchasers died, and Audie Bell, the sole survivor, presented the original certificate to Regions for payment. The bank refused to honor it, however, because it could not locate any records, which it took to mean that the CD had already been redeemed.
After Audie Bell died, the executrix of her estate filed suit against Regions for breach of contract, seeking damages in the face value of the $75,000 CD, plus a little more than $247,000 in accrued interest.
Both the estate and the bank filed motions for summary judgment.
The chancellor granted Regions summary judgment, relying on a New York case that held, in essence, that there is a legal presumption of payment arising out of the fact of a long delay between the right to enforce an obligation and the attempt to do so. He found no genuine issue of material fact, and that Regions was entitled to a judgment as a matter of law.
In the case of Estate of English v. Regions Bank, decided August 25, 2015, the COA reversed, noting that Mississippi did not recognize the same presumption as in the New York case. The court remanded for a hearing on the fact issue whether the CD had been redeemed, or whether it should be paid.
It should be emphasized here that what was reversed here was the finding that there was no genuine issue of material fact. The chancellor may well resolve the fact issue against the estate at trial, but that will depend on presentation of evidence by both sides.
What I think merits your attention is that, more and more, it seems to me, the rules of banking are tilting in favor of the banks and against “small” depositors [to a bank, $75,000 is a piddling deposit; to most of us, it is a fortune]. You might want to factor this in when advising your clients about record-keeping and protecting assets. Some of your may have some comments about how your clients can protect themselves from an adverse outcome in a scenario such as this, and how to avoid litigation. I just think most of us believe that when we have in hand an original negotiable instrument such as a CD, we expect it to be honored, and that the burden of its own record-keeping should be on the bank.
Chancery Court and the Family Feud
January 25, 2016 § 3 Comments
You will not find it in the Mississippi Constitution or in any statute, but chancery courts in Mississippi have long exercised original subject-matter jurisdiction over family feuds that may not exactly invoke any legally cognizable cause of action.
You can find a recent example in the COA’s McGriggs v. McGriggs, et al., decided December 15, 2015. In that case, after Alfred McGriggs died, one faction of his family buried him on family land in Claiborne County. Soon after, another faction filed a petition to have the body exhumed and reinterred somewhere else, alleging that (a) the burial violated the cemetery laws of the state, and (b) having a body buried on the land impaired its value for the survivors, of whom there are apparently many.
You can read Judge Wilson’s opinion for yourself. It will enlighten you about the legality of burial on private property and who gets to make the call about where and how to dispose of a dead body. Oh, and the appellant and the appellees were all pro se. [Spoiler alert: the COA affirmed the chancellor’s decision to deny the petition.]
What I want to inspect here is how chancellors handle these family disputes.
In McGriggs, the chancellor was confronted with pro se litigants who insisted on trying to air out decades-old family disagreements, misunderstandings, and slights. With the patience of a saint, the chancellor gave them wide latitude to air their grievances, reeling them back in when they went too far afield.
That really is the key in handling a case like this: to allow the airing of grievances without letting it turn into a rabbit hunt.
I once had a suit styled “Complaint for Partition of Real Property,” called for trial. Other than the fact that it included no deraignment of title, the pleading was professional-looking and set out all of the required averments. When I called the case, the two named plaintiffs answered for themselves. They were proceeding pro se. When I called the defendant, he was pro se also. I told the plaintiffs they could present their case, and they asked me what they were supposed to do. I explained that I could not help either side, but that they could call witnesses of they liked. One of the plaintiffs took the stand and explained that the defendant had moved into momma’s house after she died, and the rest of the family insisted that he move out or pay rent. He left in a huff, but when he did he dismantled the fireplace and took it with him. They wanted him to replace it or pay for a new one. The defendant did not have any cross-examination, and the plaintiffs said that was all the proof they had. I dismissed the case and pointed out this was really a lawsuit that should have been brought in county court. There was no way I could stretch this into a partition suit. But before they were shown out of chancery, the family was able to make a record of how irresponsible and low-down was the defendant.
In another case, brothers had been fighting for years over a pond that straddled their property lines. When the case came before me in 2007, I noticed that this was their fourth trip to court. All three previous cases had been settled by agreed orders, which apparently did not fix the real problem. When the lawyers came in with an agreed order this time, I told them I would not approve their settlement, but that we would give them both a chance to be heard. In two days of testimony we heard a little about a drainage problem with the pond, but we heard a lot about: rude behavior; how one brother did not attend the funeral or even send a card when the other’s son died; name-calling; hurt feelings; and a litany of petty grievances that had piled up into a family dispute. I ordered some remedial work on the drainage system and enjoined putting up of signs and other provocative acts. They have not been back since. I don’t know whether the airing of grievances helped, but I like to think it did.
Sometimes what people need is just the chance to tell someone what a no-good so and so the other party is. If it keeps people from killing and maiming each other to make that point, then I suppose that’s a legitimate function of chancery court. As McGriggs illustrates, though, it requires the chancellor to have the wisdom and insight to understand that, and the patience to let it proceed.
A Few Comments on McGrew
January 21, 2016 § Leave a comment
Following up on our post yesterday about McGrew v. McGrew, here are some comments:
- First of all, let me say that none of my comments here pertain to the lawyers or judge in McGrew. I do not know enough about everything that transpired to comment on what was done or not done, and why. These comments are general.
- As a general proposition, the longer you delay to get a final judgment entered, or to get that QDRO done, or to close that estate, the more problems will crop up. I have never understood, and still do not understand, lawyers who procrastinate in tending to their clients’ business. Do those lawyers have unlimited malpractice insurance, or are they somehow bulletproof? Get it done, get it entered, get it final, and move on. That’s what your clients are paying you for.
- If you think the particular lightning bolt of a litigant dying amidst your particular litigation is far-fetched, think again. Baby-boomers, who have inherited more wealth than any previous generation, are entering their 70’s and 80’s. So within the next 20 years, you can expect to see lots of litigation involving them (us), and mortality being what it is, odds are it will claim some of the parties in your cases in mid-lawsuit.
- When the judge directs a lawyer to prepare a judgment or order, the responsibility is on that lawyer, not on the judge or opposing counsel. If the judge says “10 days,” do it in that time-span.
- As I said yesterday, White was my case. Luther “Luke” White was my client. He was 71 when the divorce was filed, and Johnnie was 77. On record this was their fourth divorce from each other; however, at the conclusion of the trial a local attorney approached me and said that there had been yet another case some years before in which the chancellor ordered the couple to retire to a witness room and see whether they could settle the case. They emerged holding hands, he said, and went downstairs to the clerk’s office and dismissed the divorce. Shannon Clark was the chancellor in my case. When he rendered his bench opinion for the small audience gathered in the courtroom, he began something like this: “In my years as a chancellor, and as a practicing attorney, I have seen many divorces. A good number have involved couples getting their second divorce from the same spouse as previously. And you might be surprised to know that a number of cases have involved couples getting their third divorce from each other. But never, in all my years as a chancellor or lawyer, have I ever seen the same couple get their fourth divorce from each other. Never.”
‘Til Death Do Us Part
January 20, 2016 § 1 Comment
It should be pretty clear that one party’s death during pendency of a divorce proceeding puts a stop to the divorce and leaves the parties right where they were before the divorce action was filed.
What is less clear is what happens to the divorce when one party dies after trial but before a judgment is entered.
That scenario has actually been played out in appellate cases several times, as we shall see.
The most recent example is the case of McGrew v. McGrew, decided by the COA December 15, 2015.
A trial in the divorce case of Peggy and Charles McGrew was held on November 22, 2013. The chancellor ruled from the bench that Peggy was entitled to a divorce from Charles on the grounds of adultery and imprisonment. The chancellor also ordered that Peggy have use and possession of the former marital residence until Charles was released from prison, at which time it would be sold and the equity divided. The chancellor ordered that a judgment be prepared based on his oral rulings.
Peggy was dissatisfied with the ruling on the residence, however, and she filed a R59 motion on December 2, 2013. No judgment of divorce had been entered.
On March 25, 2014, following a hearing on the R59 motion, the judge directed Peggy’s attorney to prepare and present a judgment granting a divorce, based on the previous bench ruling, within ten days, but took the rehearing motion under advisement.
Charles died on June 10, 2014. No judgment of divorce had yet been entered. Peggy immediately filed to withdraw her divorce action. Charles’s attorney filed a motion contending that the bench ruling was final and binding, and that the equitable distribution should be enforced.
On July 18, 2014, the chancellor entered a judgment granting the divorce nunc pro tunc to November 22, 2013, including the terms adjudicated that day.
The COA reversed and rendered. The rationale by Judge Barnes is a lengthy quote by the standards of this blog, but it’s worth your attention:
¶16. Peggy argues the divorce action abated on Charles’s death, and the chancellor had no authority to enter the final judgment nunc pro tunc after Charles’s death.
¶17. Generally, a pure divorce action abates upon the death of one spouse prior to the final decree. Pittman v. Pittman, 375 So. 2d 415, 416 (Miss. 1979). Once a spouse dies, “there is then no status of marriage upon which the final decree of divorce may operate.” Id. (quoting Caprita v. Caprita, 60 N.E.2d 483, 485 (Ohio 1945)). Our supreme court, quoting the American Law Reports, has stated:
It is well settled by practically all of the authorities that, upon the death of one of the parties to a purely divorce action, before the entry of a final decree therein, whether before or after the entry of an interlocutory decree or a decree nisi, the action abates with the consequence that the action may not be continued and no final decree of divorce may be entered thereafter, since the object sought to be accomplished by the final decree, that is, the dissolution of the marriage relation, is already accomplished by the prior death of one of the parties, and there is then no status of marriage upon which the final decree of divorce may operate. The result is that, notwithstanding the pending divorce action and the fact that a divorce might have been granted had no death occurred, the wife is regarded as the widow of the deceased husband, or the husband is regarded as the widower of the deceased wife, as the case may be. Id. (quoting 104 A.L.R. 654).
¶18. Like the request for a divorce, when one spouse dies, “all issues . . . incidental to the request for a divorce and the contest thereon . . . die[].” Id. at 417. This is consistent with the general rule that “[l]itigation is not to be carried on by or against any deceased person.” Billy G. Bridges & James W. Shelson, Griffith Mississippi Chancery Practice § 591 (2000). As explained in Griffith Mississippi Chancery Practice § 620:
A valid judgment cannot be rendered in favor of two persons, one of whom at the time is dead. Such a judgment is void. And likewise a judgment rendered against a defendant after his death is void if he was the sole defendant or was an indispensable party to the action, although the interlocutory or temporary judgment was rendered while he was alive.
¶19. If, however, all issues have been formally adjudicated prior to one spouse’s death, the entry of the divorce judgment postmortem may be permissible under limited circumstances. The rule in such a situation is as follows:
[I]f the facts justifying the entry of a decree were adjudicated during the lifetime of the parties to a divorce action, so that a decree was rendered or could or should have been rendered thereon immediately, but for some reason was not entered as such on the judgment record, the death of one of the parties to the action subsequently to the rendition thereof, but before it is in fact entered upon the record, does not prevent the entry of a decree nunc pro tunc to take effect as of a time prior to the death of the party. But if no such final adjudication was made during the lifetime of the parties, a decree nunc pro tunc may not be entered after the death of one of the parties, to take effect as of a prior date.
Thrash v. Thrash, 385 So. 2d 961, 962-63 (Miss. 1980) (internal citations omitted) (quoting 104 A.L.R. 654, 664 (1936)).
¶20. Here, the chancellor found that because he intended the bench ruling to be final, the entry of the nunc pro tunc order was permissible. Nunc pro tunc means “now for then.” White v. Smith, 645 So. 2d 875, 880 (Miss. 1994). A nunc pro tunc order is used to “supply omissions in the record of what had previously been done, and by mistake or neglect not entered.” Id. (quoting Green v. Myrick, 177 Miss. 778, 171 So. 774 (1937)). A judgment entered nunc pro tunc “normally does not refer to a new or fresh (de novo) decision, as when a decision is made after the death of a party, but relates to a ruling or action actually previously made or done but concerning which for some reason the record thereof is defective or omitted.” Id. (quoting Thrash, 385 So. 2d at 963). The entry of a nunc pro tunc order “does not itself have a retroactive effect[,] but it constitutes the later evidence of a prior effectual act.” Id. (quoting Thrash, 385 So. 2d at 963).
¶21. The chancellor relied on White in support of his decision that the entry of the nunc pro tunc order was permissible. In White, the wife, Johnnie White, filed a complaint for divorce from her husband, Luther White. Id. at 876. The parties later consented to an irreconcilable difference divorce. Id. at 879. A hearing was held, and the chancellor orally granted the divorce. Id. However, before the oral ruling was reduced to writing, Luther died. Id. at 877. Upon Luther’s death, Johnnie moved to dismiss the divorce action. The motion was denied. The chancellor then entered the divorce judgment nunc pro tunc to the date of the bench ruling. The supreme court found the nunc pro tunc judgment permissible, as all matters had been finally adjudicated prior to Luther’s death. Id. at 881. The supreme court reasoned:
[F]rom a technical standpoint, Luther died while married, since his death was prior to the entry of the decree. However, the record clearly indicates that all submitted issues had been litigated and ruled upon by the chancellor on [the date of the bench ruling]. Nothing more was to be accomplished in the interim between the ruling and formal filing of the judgment.
Id.; see also Thrash, 385 So. 2d at 964 (finding divorce judgment proper where all matters were resolved and the judgment was signed by the chancellor one day prior to the husband’s death, but the judgment was not filed by the clerk until one day after the husband’s death).
¶22. Although not discussed by the chancellor, we find it important to note a key distinction between this case and White. White involved a consent divorce, whereas Peggy sought a fault-based divorce. The parties in White had entered into an “irrevocable consent to divorce” prior to Luther’s death. White, 645 So. 2d at 879. Because the parties had signed the irrevocable consent to divorce, the parties were statutorily bound by this contractual agreement, and they were estopped from arguing otherwise. Id. Thus, there was no decision for the chancellor to make regarding the grant or denial of the divorce. Oral factual findings were made regarding the division of property not previously agreed upon. These findings were incorporated into the final judgment. However, it was undisputed these matters were adjudicated as of the date of the bench ruling. Id. at 881.
¶23. Because of this distinction, we find the chancellor’s reliance on White was misplaced. We agree with Peggy’s assertion that the facts here are analogous to those in Pittman, 375 So. 2d at 415, where no final adjudication was found. In Pittman, the wife, Ella Mae Pittman, died between the chancellor’s bench ruling and final divorce judgment. Id. at 415-16. Two weeks prior to her death, the chancellor sent a letter to both sides, setting out his findings and stating that a divorce would be granted in favor of Ella Mae. Id. He instructed the attorneys to prepare a judgment consistent with the letter. After negotiations, the attorneys agreed to the form of a final judgment and sent it to the chancellor. Id. at 416. The chancellor executed the judgment ten days after Ella Mae’s death. Id. The supreme court reversed, finding that the chancellor had no authority to enter the final judgment after Ella Mae’s death, because “all issues in the cause were incidental to the request for a divorce and the contest thereon, and the entire cause died with the complainant.” Id. at 417. In finding the action abated upon Ella Mae’s death, the supreme court stated:
The authorities are clear that the death of [a party] in the divorce action prior to the execution and entry of the final decree by the lower court ended the marriage of the parties and cancelled fully the bill of complaint for divorce and incidental property relief. This is so even though testimony had been heard in the cause and the court had issued what might be termed an “interlocutory order” in the form of a letter.
Id. at 416. The supreme court emphasized “that every decree is in the breast of the court until entered, and a decree has no validity until written out and signed by the chancellor.” Id. (quoting Orr v. Myers, 223 Miss. 856, 862, 79 So. 2d 277, 278 (1955)).
¶24. Although the chancellor in Pittman did not enter the judgment nunc pro tunc to a date prior to Ella Mae’s death, we find this of no consequence. The fact remains that the divorce was not finally adjudicated prior to Ella Mae’s death. A nunc pro tunc judgment is meant to supply omissions in the record, not to set forth a new or fresh decision. White, 645 So. 2d at 880. Thus, a nunc pro tunc judgment would not have been permissible.
¶25. Like Pittman, we find the record here does not support a finding of finality prior to Charles’s death. First, in his bench ruling, the chancellor left the record open for the parties to resolve certain property disputes, stating:
I want to give those things to each of the parties in accordance with its emotional value to either of the parties. . . . So y’all try [to] work those out in that manner so that I don’t have to try to do it myself after this trial is over. And if I have to reconvene the trial to deal with those, I will. But I don’t want the parties to have to get buried in that stuff. And we’ll get back to that.
. . . .
Now, I’m going to leave the record open for you all to divide those personal items.
¶26. Next, Peggy’s motion for reconsideration was not ruled upon during Charles’s lifetime. While the hearing on this motion occurred during Charles’s lifetime, on March 14, 2014, no oral ruling was made. Instead, at the conclusion of the arguments, the chancellor stated:
All right. . . . What I’m going to do is take that under advisement and I’ll give you a decision within 30 days. . . . If you want to submit any law, either side may do so within 10 days.
There is no indication that law was submitted, or that the chancellor reached a decision in thirty days. The next mention of the motion for reconsideration appears in the chancellor’s findings of fact and conclusion of law, which were not drafted or entered until after Charles’s death.
¶27. Also at the hearing on the motion for reconsideration, the following exchange took place regarding the lack of a final judgment:
[CHARLES’S COUNSEL]: . . . Because of Mr. Crosby’s filing this motion [for reconsideration], we have not yet supplied the Court with an order and I hope we’re not negligent in doing so.
THE COURT: Okay. Well, you probably are. It’s been awhile.
[CHARLES’S COUNSEL]: I was saying I might wait another 30 days if you’re giving something consideration.
THE COURT: I would rather see at least the form of the order — if I’m going to reconsider something, I would like to see what I’m reconsidering.
[PEGGY’S COUNSEL]: Yes, sir.
[CHARLES’S COUNSEL]: We’ll have it next week, Your Honor.
THE COURT: Okay.
[PEGGY’S COUNSEL]: In the meantime, would it be appropriate if I gave you the divorce itself, the divorce of the parties, or should we wait?
THE COURT: No. I want to do it all at one time. The supreme court likes it better that way.
(Emphasis added).
¶28. Although Peggy’s counsel requested the chancellor to enter an order solely granting the divorce, the chancellor chose not to do so.[FN 2]
[Fn 2] Had the chancellor entered such an order of divorce, it would not have been “final” without a Mississippi Rule of Civil Procedure 54(b) certification. See M.W.F. v. D.D.F., 926 So. 2d 897, 899-900 (¶¶4-6) (Miss. 2006) (judgment of divorce not final where custody and division of assets not yet adjudicated).
Rather, the chancellor again left the matter open pending resolution of all issues. On March 25, 2014, the chancellor wrote the attorneys and requested that Peggy’s counsel submit a proposed final judgment consistent with the bench ruling. Both sides submitted proposed judgments. However, the judgments differed in (1) who was granted the divorce and upon what grounds, (2) who was awarded a generator that was wired into the marital home, and (3) the disposition of one of the vehicles. Because of the discrepancies, the chancellor ordered a transcript of the bench ruling. The transcript was received six days after Charles’s death, on June 16, 2014. The judgment was then drafted and entered on July 18, 2014.
¶29. Finally, although the judgment states it is consistent with the bench ruling, there are differences. For example, in the final judgment, Charles is awarded the 1992 Jeep Wrangler and Yamaha jet ski. However, in his bench ruling, the chancellor ordered these same vehicles sold and the proceeds divided. Adding to the inconsistency, these same two vehicles were awarded to Peggy pretrial, for her to liquidate and keep the proceeds. Also, there is no indication of an agreement regarding the disputed personal property, as ordered by the chancellor at the bench hearing. Although the chancellor states in his findings of fact and conclusions of law that all disputes were resolved, the divorce judgment does not reflect such a resolution. Rather, the divorce judgment states: “[T]he personal property in the home shall be divided . . . . If the parties cannot agree on a division of said personal property, then each party shall submit a list to the other party.”
¶30. Because all issues were not finally adjudicated prior to Charles’s death on June 10, 2014, the chancellor’s entry of the nunc pro tunc divorce judgment was improper. The chancellor had no authority to enter the divorce judgment. A chancellor may not circumvent the general rule that “a decree rendered against a defendant after his death is void” by entering a judgment nunc pro tunc. Bridges & Shelson, Griffith Mississippi Chancery Practice § 620. Consequently, the divorce judgment is void. See Pittman, 375 So. 2d at 416-17. Consistent with the supreme court’s ruling in Pittman, we “reverse[] and render[] [this cause] without prejudice to the rights of any person affected by [Charles’s] death[.]” See id. at 417.
Don’t assume the lag-time between entry of the final judgment and the death was as long in the cited cases as it was in McGrew. In White, for instance, the trial was concluded mid-afternoon on Tuesday, and the final judgment was put in the mail to Johnnie’s lawyer that day (this was in the pre-email era). It was received by Johnnie’s lawyer (50 miles distant from Luther’s lawyer) on Thursday. Luther was admitted to the hospital on Friday, and he died the following Monday. That’s how fast things can spin out of control. And how do I know all this? White was my case.
More comments on McGrew tomorrow.
Lamar Won’t Run Again
January 19, 2016 § Leave a comment
Turnover on the MSSC continues with Justice Ann Lamar’s announcement that she will not seek re-election. Her position is up for re-election in November, 2016. Her term ends on December 31, 2016.
Lamar, from Senatobia, was elected to an 8-year term in November, 2008, from the Northern District. She had been appointed in 2007.
Change in judicial positions, particularly appellate posts, sometimes seems to occur at a glacial pace, but that is certainly not the case this year and last. Lamar’s is the third MSSC position to turn over since December, 2015. This one will be filled by election. The other two — Justices Beam and Maxwell — were filled by Governor Bryant’s appointment. There is still a vacant COA post in the Southern District awaiting appointment.
Partiting the Former Marital Residence
January 14, 2016 § 2 Comments
Robert and Betty Coleman were divorced in 2002. Under the terms of the divorce judgment, Beverly got exclusive use and possession of the former marital residence, which was situated on family land deeded to the couple by Beverly’s mother, until the parties’ minor child attained majority age. Beverly was responsible to pay the mortgage debt, taxes, and insurance on the property, and the parties were to split equally any maintenance expenses. The judgment did not spell out what was to be done when the child turned 21.
In the years following the divorce, Beverly lived in the home and dutifully paid the sums assigned to her. Robert never paid any of the maintenance expenses.
When the child turned 21 in 2013, Beverly filed an action, apparently for modification of the divorce judgment, seeking possession, title to, and ownership of the home.
Robert counterclaimed for partition, and he filed a motion for a summary judgment that partition, rather than modification, was the proper avenue to accomplish the division. The chancellor agreed with Robert, ruling that “the parties are not married, the property is no longer the marital homestead and the property is subject by law to a division by partition as provided by statute.” That’s a neat, pinpoint ruling that avoids the problem that property division may not be modified.
A hearing was held on the petition, and the chancellor ruled that Betty should have title. He adjusted the equities by ordering Beverly to pay Robert $34,103.70, which amounted to his half-equity in the property at the time of the divorce adjusted upward for appreciation over time.
Robert appealed, arguing that the trial court impermissibly modified the divorce judgment and unfairly partited the property.
In Coleman v. Coleman, handed down January 12, 2016, the COA, by Judge Griffis, affirmed.
So, did the chancellor improperly modify the divorce judgment? Judge Griffis responds:
¶7. “A cotenant wishing to partite real property subject to a divorce decree is not required to file suit to modify the decree, but may exercise her statutory right to partition by filing a petition for partition.” Mosby v. Mosby, 962 So. 2d 119, 123 (¶12) (Miss. Ct. App. 2007) (citing Blackmon v. Blackmon, 350 So. 2d 44, 46 (Miss. 1977)). Robert argues that the chancellor essentially modified the divorce decree and that this modification was improper.
¶8. “This argument is without merit because the chancellor clearly granted the petition for partition and did not, in fact, modify the decree.” Id. Robert requested a partition, and the chancellor stated in his judgment that “the parties are no longer married, the equities need to be adjusted[,] and the partition statutes provide a sound method of arriving at a just and equitable result.” The court “proceeded accordingly under partition.” As the chancellor’s decision was based upon the partition statutes and he did not modify the divorce decree, the Court finds this issue without merit.
And did the chancellor abuse his discretion in how he awarded title and adjusted the equities? Again, Judge Griffis:
¶9. When parties seek a partition of land, “the question of title shall be tried and determined in the suit and the court shall have power to determine all questions of title.” Miss. Code Ann. § 11-21-9. In doing so, “[t]he court may adjust the equities between and determine all claims of the several cotenants . . . .” Id.
¶10. Generally, “a partition in kind, rather than a partition by sale, is the preferred method of dividing property in Mississippi.” Cathey v. McPhail & Assocs., 989 So. 2d 494, 495 (¶4) (Miss. Ct. App. 2008) (citing Fuller v. Chimento, 824 So. 2d 599, 601 (¶8) (Miss. 2002)). Robert and Beverly agreed that the home could not be divided in kind and that it should be sold under statute. They also agreed to a private sale to allow Beverly to purchase the home. A chancellor may order the sale of property and “a division of the proceeds among the cotenants according to their respective interests.” Miss. Code Ann. § 11-21-11 (Rev. 2004). As both parties agreed to a sale, the chancellor essentially needed to “adjust the equities between and determine all claims” of Robert and Beverly and divide “the proceeds” between Beverly and Robert “according to their respective interests.” Miss. Code Ann. §§ 11-21-9 & 11-21-11.
As for how the chancellor adjusted the equities, the COA went through the court’s analysis, and found it proper that Robert was awarded his equity at the time of the divorce plus its appreciation, and Beverly was awarded her equity at the time of the divorce, plus its appreciation, plus the additional equity that accrued over the years due to her payment of the mortgage debt. The COA found no merit in Robert’s argument.
Most crucially, the trial judge’s findings were supported by substantial evidence:
¶15. Keeping in mind the appropriate standard of review, this Court holds that the chancellor’s findings of fact and conclusions of law are supported by substantial evidence and are not an abuse of discretion. Robert did not provide any alternatives to the findings of the chancellor. Furthermore, the parties both agreed that a sale to Beverly was ideal. The chancellor’s well-reasoned conclusions are supported by the record and the briefs of the parties. The partition statutes allow for the chancellor to divide the proceeds among the cotenants according to their interests in the property. Miss. Code Ann. § 11-21-11. After inspecting the record, this Court is unable to see that Robert was denied any of his rights as a cotenant in the chancellor’s final decree. Finding no error, this Court affirms.
This is not one of those spectacular, keeper cases that one whips out every few trials. It’s just a workaday, nuts-and-bolts decision that provides a glimpse into the quotidian matters that stream steadily through the chancery courts every day, and how the chancellors are called upon to fashion common-sense, practical solutions.
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