Charlotte Scott Forbess v. Michael E. Forbess
2011 Tenn. App. LEXIS 654
| Tenn. Ct. App. | 2011Background
- Wife and Husband, married in 1990, seek equitable division of marital assets including Husband's one-half interest in a real estate partnership (Forbess Brothers Partnership).
- Pre-marriage assets included a single partnership asset (Smithville Mobile Home Park) later sold for cash and a note, with proceeds/notes partially memorialized in marital arrangements.
- Partnership assets expanded during marriage to include Hunter property, Westside Mobile Home Park, Covington office buildings, and lease-purchase arrangements; distributions and income from these assets were a core part of the marital estate.
- Trial evidence included competing expert valuations of Husband's partnership interest, with Wife presenting a higher, more subjective valuation and Husband presenting discounting methodologies reflecting lack of marketability and control.
- Trial court valued Husband’s 50% partnership interest at $750,000, ordered a $375,000 distributive award to Wife funded by monthly partnership distributions, and awarded Wife $250 per month alimony in futuro; Smithville Note was deemed marital property and subject to division; court denied attorney fees to Wife.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Division of marital property: value and distribution of partnership interest | Forbess argues partnership should be valued higher and/or Wife should receive a direct property interest. | Boals/Ivy valuations support $750,000 value and distributive award via income; tax implications and marketability discounts justify the structure. | Court's factual findings upheld; Wife received distributive award funded by partnership distributions. |
| Alimony in futuro amount | Wife contends $250 monthly alimony is inadequate given Wife's education, health, and disparity in earning capacity. | Court weighed statutory factors and found award within its discretion given Wife's needs and Husband's ability to pay. | No abuse of discretion; alimony award affirmed. |
| Characterization of Smithville Note and other assets as marital property | Note and related distributions should be treated as marital property subject to division. | Note and distributions are part of marital estate due to commingling and use for marital purposes. | Court affirmed treating Smithville Note as marital property subject to division. |
| Tax consequences of the division (tax liability deduction from cash award) | Taxes should not diminish Wife's cash award directly; tax considerations should be addressed differently. | Court properly accounted for anticipated tax implications in the distributive award. | Tax considerations reflected in the court’s calculations; no error found. |
| Adequacy of recordkeeping and Rule 7 compliance regarding valuation chart | Wife failed to include Rule 7 chart; arguments should be waived | Partial excusal possible; but Husband's arguments similarly not properly raised. | Wife's valuation issues waived; court considered record and continued. (Note: waiver handled; issues not reversible.) |
Key Cases Cited
- Farrar v. Farrar, 553 S.W.2d 741 (Tenn. 1977) (review of division of marital property involves de novo standard with factual underpinnings)
- Woodward v. Woodward, 240 S.W.3d 825 (Tenn. Ct. App. 2007) (trial court has wide latitude in equitable division of marital property; deference to trial court findings)
- Gonsewski v. Gonsewski, 350 S.W.3d 99 (Tenn. 2011) (abuse-of-discretion standard for alimony with factual balancing of statutory factors)
- Newcomb v. Kohler Co., 222 S.W.3d 368 (Tenn. Ct. App. 2006) (failure to cite authority constitutes waiver of issue on appeal)
- Bean v. Bean, 40 S.W.3d 52 (Tenn. Ct. App. 2000) (requirement to cite record and authority in appellate briefing to preserve issues)
- Childress v. Union Realty Co., 97 S.W.3d 573 (Tenn. Ct. App. 2002) (waiver for failing to designate issues or argument on appeal)