Brave v. Brave
2014 Ark. 175
Ark.2014Background
- Peter and Marie Brave, married >20 years, co-owned Brave New Restaurant; Peter filed for divorce in November 2010.
- Circuit court valued Brave, Inc. (including real estate, FF&E, and goodwill) and found net business value $840,000; awarded Marie $420,000 as her share (paid via monthly installments), plus child support and long-term alimony.
- Peter challenged (1) characterization of the business goodwill as corporate (marital) rather than personal to him, and (2) that awarding both a share of goodwill and alimony impermissibly "double dips" into his future earnings.
- Trial testimony (Dobbs valuation) used an EBITDA/market-sale approach and adjusted for replacement of Peter, supporting marketable (corporate) goodwill. Circuit court found the valuation credible and concluded goodwill was corporate; it reduced alimony from $5,000 to $4,000 after considering the double-dipping argument.
- Peter appealed; Marie moved to dismiss based on partial payments. Circuit court had found those payments involuntary; the Supreme Court denied dismissal, affirmed characterization of goodwill as corporate, rejected double-dipping claim, and vacated the court of appeals opinion.
Issues
| Issue | Plaintiff's Argument (Brave) | Defendant's Argument (Marie) | Held |
|---|---|---|---|
| Whether goodwill in Brave New Restaurant is personal to Peter or corporate (marital) property subject to division | Goodwill is personal to Peter and represents his future earning capacity, not a divisible business asset | Valuation evidence shows goodwill is marketable and part of the business; thus marital and divisible | Court affirmed: goodwill is corporate/marital based on market-sale valuation and replacement-operator adjustment |
| Whether awarding both a share of goodwill and alimony impermissibly "double dips" into Peter's future income | Division of goodwill plus alimony improperly double-counts Peter's future earning capacity | Alimony is discretionary to address post-divorce economic imbalance; corporate goodwill division is separate and permissible | Court affirmed: no impermissible double-dipping; court considered the argument and reduced alimony amount |
| Whether voluntary post-judgment payments deprived the Supreme Court of jurisdiction to hear the appeal | Peter’s payments show voluntary acquiescence to judgment, so appeal should be dismissed | Peter announced intent to appeal, sought stay, and circuit court found payments involuntary; appeal preserved | Court denied dismissal: payments were not voluntary acquiescence given motion to stay and circuit-court finding of involuntariness |
| Standard of review for valuation and alimony issues on appeal | N/A (procedural) | N/A | Court applies de novo review for divorce appeals generally; factual findings (valuation) affirmed unless clearly erroneous; alimony reviewed for abuse of discretion |
Key Cases Cited
- Wilson v. Wilson, 294 Ark. 194 (1987) (adopts Nebraska approach: goodwill is divisible marital property only if marketable independently of an individual)
- Taylor v. Taylor, 222 Neb. 721 (1986) (distinguishes personal goodwill tied to an individual from marketable business goodwill)
- Kuchmas v. Kuchmas, 368 Ark. 43 (2006) (sets alimony standard: discretionary award to address economic imbalances; factors to consider)
- Hall v. Hall, 2012 Ark. 429 (2012) (payment in compliance with judgment can be voluntary acquiescence barring appeal when no steps taken to preserve rights)