Kelly v. Kelly
381 S.W.3d 817
| Ark. | 2011Background
- John K. Kelly and Christy Snowden Kelly married Nov 27, 1982; one child born of the marriage.
- Christy filed for divorce Jan 10, 2006; May 10, 2007 hearing addressed Christy’s interest in Tarco Roofing Materials, Inc. (TRM).
- TRM was formed with stock issued to Christy and David Snowden Jr.; the stock’s origin and intent were disputed.
- Circuit court (July 30, 2007) held Christy’s TRM stock was a nonmarital gift from her father, David Sr., based on an inter vivos gift theory.
- Subsequent hearings (2008–2009) and the August 20, 2009 divorce decree allocated TRM stock as Christy’s sole nonmarital property but treated Edgehill mortgage funds as a marital debt; appeal followed.
- The appellate court reversed and remanded on the TRM stock issue, citing that the stock was marital property, thereby not addressing the debt division issue on remand.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether TRM stock is marital or nonmarital property. | Kelly argues the stock was gifted or acquired with nonmarital funds. | Kelly contends the stock was nonmarital due to lack of valid gift or separate-ownership origin. | TRM stock is marital property; remanded for property division. |
| Whether the marital home deficiency should be equally divided. | Equal sharing of the marital debt and deficiency. | Equitable considerations may justify unequal division. | Not addressed on appeal due to remand on the stock issue. |
Key Cases Cited
- Farrell v. Farrell, 365 Ark. 465 (2006) (court recognized gift or exchange-for-gift as potential nonmarital property under §9-12-315(b))
- McDermott v. McDermott, 336 Ark. 557 (1999) (premise that most property acquired during marriage is marital unless excepted)
- Jackson v. Jackson, 298 Ark. 60 (1989) (enforces right-to-acquire property as marital unless excepted)
- Chalmers v. Chalmers, 327 Ark. 141 (1997) (delivery sufficiency in gifts between family members)
- O'Fallon v. O'Fallon, 341 Ark. 138 (2000) (gift elements and delivery considerations)
- Hackett v. Hackett, 278 Ark. 82 (1982) (consideration of debts in property division proceedings)
- Boxley v. Boxley, 77 Ark.App. 136 (2002) (context of marital debt allocation alongside property division)
- Taylor v. Taylor, 369 Ark. 31 (2007) (de novo review standard in divorce appeals)
- Conlee v. Conlee, 370 Ark. 89 (2007) (standard for reviewing property division findings)
- Hernandez v. Hernandez, 371 Ark. 323 (2007) (illustrates unequal distributions may be warranted under §9-12-315)