Sherman v. Boeckmann II
2016 Ark. App. 568
| Ark. Ct. App. | 2016Background
- Jeannie Sherman and Raymond Boeckmann divorced; the circuit court’s decree (Sept. 30, 2013) divided marital property, awarding each one-half of four family corporations and various bank accounts (total ≈ $3.6M; Logan Center accounts ≈ $1.6M).
- After the decree, Sherman withdrew substantial funds from Logan Center accounts (tax payments, salary increases, transfers between accounts, purchases), and Boeckmann filed multiple postdecree contempt petitions seeking accounting, reimbursement, and other relief.
- The circuit court found many corporate/bank accounts were marital property, held Sherman in contempt for some conduct, ordered reimbursements and sanctions (including a $20,000 attorney-fee sanction), and ordered removal of children as signatories and sale of a house Sherman purchased after the decree.
- Sherman appealed, arguing lack of jurisdiction, improper control of the nonparty corporation (Logan Center), error in awarding reimbursement for tax payments and other withdrawals, error in ordering sale of the postdecree house, and error in the sanctions/fee award.
- The Court of Appeals affirmed in part, reversed in part, and remanded: it upheld the court’s jurisdiction to enforce the decree and some remedies (tax offset, fee sanction), but reversed orders requiring reimbursement or sale based on withdrawals made after the decree and remanded the token-economy accounting.
Issues
| Issue | Sherman’s Argument | Boeckmann’s Argument | Held |
|---|---|---|---|
| Jurisdiction to act post-decree / during appeal | Court lost jurisdiction after decree/after 90 days; appeal divests court | Court retained jurisdiction to enforce decree; reservation in decree allowed postdecree relief | Court retained jurisdiction to enforce decree and order remedies (Rule 60 timing not applicable) |
| Tax payments (Sherman paid her 2012 taxes with Logan Center funds) | Payments were ordinary-course corporate expenses; not subject to reimbursement | Taxes were personal S-corp shareholder obligations paid from marital funds; offset/reimbursement to equalize is appropriate | Court may order offset; awarding one-half of taxes paid to Boeckmann was within discretion |
| Control of Logan Center withdrawals and salary (multiple subclaims) | Logan Center is a separate nonparty entity; court cannot micromanage corporate operations or limit postdecree use of funds awarded to Sherman | Corporate accounts were marital property; court can enforce decree, determine ordinary-course expenditures, and require reimbursements for marital funds misused | Court erred where withdrawals/postdecree expenditures were from funds already awarded to Sherman (withdrawals after decree); court properly enforced reimbursement for pre-decree excess salary and pre-decree misuses; token-economy amounts require remand to segregate pre- and post-decree spending |
| Sale of house bought post-decree & removal of children as signatories; attorney-fee sanction | House purchased after decree not marital; sale gives Boeckmann double recovery; removing children unnecessary; fee sanction improper without valid contempt finding | House purchased with marital funds; court can require accounting and remedy; removing signatories protects marital assets; contempt finding supports sanctions and fee award | Court erred ordering sale of the post-decree house and reversing reimbursements tied to post-decree expenditures; removal of children as signatories not prejudicial; fee sanction ($20,000) was within the court’s discretion and affirmed |
Key Cases Cited
- Omni Holding & Dev. Corp. v. 3D.S.A., Inc., 356 Ark. 440 (2004) (contempt can be used to effect civil remedies and make the innocent party whole)
- Cox v. Cox, 17 Ark. App. 93 (1986) (trial court may retain jurisdiction to enforce a divorce decree; Rule 60 timing not controlling for enforcement)
- Page v. Anderson, 85 Ark. App. 538 (2004) (divorce decree entry is the bright-line for determining marital vs. post-decree property)
- Williams v. Williams, 82 Ark. App. 294 (2003) (trial court has discretion to determine necessity, reasonableness, and offsets for funds used during pendency)
- Butler v. Comer, 57 Ark. App. 117 (1997) (contempt used to obtain civil relief in domestic relations context)
- Applegate v. Applegate, 101 Ark. App. 289 (2008) (attorney-fee sanctions in domestic cases must be supported by valid contempt findings)