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Waring v. Waring

October 13, 1998

SHIRLEY B. WARING APPELLANT
v.
RICHARD L. WARING APPELLEE



Before McMILLIN, P.j., Diaz, And King, JJ.

The opinion of the court was delivered by: McMILLIN, P.j.

DATE OF JUDGMENT: 05/06/96

TRIAL JUDGE: HON. VICKI R. BARNES

COURT FROM WHICH APPEALED: WARREN COUNTY CHANCERY COURT

NATURE OF THE CASE: CIVIL - DOMESTIC RELATIONS

TRIAL COURT DISPOSITION: DIVORCE GRANTED ON IRRECONCILABLE DIFFERENCES; ALIMONY AWARDED TO APPELLANT

DISPOSITION: REVERSED AND REMANDED-10/13/98

MOTION FOR REHEARING FILED:

CERTIORARI FILED:

MANDATE ISSUED:

¶1. Shirley Waring and Richard Waring agreed to a divorce on the ground of irreconcilable differences. Unable to resolve all issues relating to property rights and post-divorce support obligations, the parties agreed in writing to submit those issues to the chancellor for resolution. The chancellor, after a lengthy evidentiary hearing, awarded Mrs. Waring sole title to the marital home, an amount of lump sum alimony, and provided her with rehabilitative alimony for a period of three years. Mrs. Waring has appealed, claiming that the chancellor's failure to be more generous was a manifest abuse of discretion. We agree and, therefore, reverse and remand for further proceedings.

I.

Facts

¶2. The parties were married on October 17, 1987 and separated finally on December 15, 1993. They were not divorced until March 1996; however, much of that period was taken up with litigation in pursuit of a divorce. For purposes of our Discussion, therefore, we will consider that this was a marriage of approximately six years duration.

¶3. Prior to the marriage, Mrs. Waring was a Louisiana resident who provided her own support by operating several businesses. One business was shut down and another was sold in contemplation of the marriage. Another business activity, involving residential interior decorating services, was continued on a part-time basis after the marriage, but it did not produce significant income to Mrs. Waring. Mr. Waring, for his part, was engaged in a number of businesses owned by Mr. Waring and certain other relatives that included a propane gas distributorship, a company engaged in the distribution of gasoline and related petroleum products, and a company that operated a number of convenience stores. Mr. Waring was a shareholder in these businesses, along with his relatives, and all of the businesses were operated as subchapter S corporations. The evidence suggests that Mr. Waring was compensated for his efforts in the family businesses by way of salary and periodic distributions of earnings. These sources of compensation provided essentially the sole source of support for the family during the marriage. Mrs. Waring did not play an active role in the businesses; however, she did become active in a significant way in local politics and served as the first female president of the country club to which the parties belonged. Mrs. Waring testified that she did, on occasion, assist in business activities; however, it is not subject to reasonable dispute that those activities were sporadic.

¶4. The marriage was the first for Mr. Waring and Mrs. Waring's third. Mr. Waring was thirty-two years of age at the time of the marriage and Mrs. Waring was thirty-nine. No children were born of the marriage. There is no evidence that either party was suffering from any significant health problems at the time of the divorce.

¶5. Mr. Waring's holdings in the family corporations predated the marriage. In addition, he owned a condominium property prior to the marriage. Mrs. Waring's separate estate at the time of the marriage consisted of an automobile which was thereafter used as the family vehicle throughout the marriage. In addition, she testified that she received funds in the approximate amount of $5,000 from the sale of one of her businesses and that she contributed those funds to the marriage. At the time of divorce, she had no separate bank accounts or investments. Mr. Waring had, during the marriage, accumulated funds in a retirement account. He testified that the account had increased by approximately $30,000 during the marriage. Mrs. Waring claimed that the fund had increased by approximately $44,000 during that time.

¶6. The parties had purchased an older home during their marriage and expended considerable sums in rehabilitating and refurbishing the home. Proof was offered that the property had an approximate value of $212,000; however, it was subject to two outstanding mortgage debts that totaled about $195,000. The chancellor did not make a specific finding as to the market value of the property.

¶7. There was evidence presented to the chancellor that the family businesses in which Mr. Waring was a shareholder and in which he was an active participant had increased substantially in value during the course of the marriage. This increase in value was apparently due, at least in part, to acquisitions of new properties and expansion of the number of convenience stores owned and operated by these family-held corporations. These acquisitions and expansions were partially financed by bank loans; however, there was also evidence that a significant part of the money for these expansions came from the profits of the operation of the businesses themselves. The parties hotly disputed the amount of the increase in value of these businesses during the marriage. Mrs. Waring produced expert opinion evidence from an accountant who had done an evaluation of these closely-held corporations that indicated that the value of Mr. Waring's holdings had increased in value from $668,101 at the time of the marriage to approximately $4,038,404 at the time of the divorce.

ΒΆ8. There was evidence presented in the form of Mr. and Mrs. Waring's joint federal tax return for 1994 that indicated the couple had an adjusted gross income before taxes of $424,639. In 1993, the couple's adjusted gross income was $409,396. In addition, Mr. Waring was furnished an automobile through the family businesses. Insofar ...


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