Shewbart v. Shewbart
2010 Ala. Civ. App. LEXIS 381
Ala. Civ. App.2010Background
- Wife and husband divorced; remanded to value the sole proprietorship Swamp John’s Restaurant & Catering and reconsider alimony.
- On remand, CPA Norvell valued the business using income-approach; two computations presented (EBITDA-based and salary-based) with a proposed value of $191,376 or $300,000 respectively.
- Trial court on remand used a three-year income average (2006–2008) and a two-times multiple, yielding $69,986 total, with wife’s half valued at $34,993 minus $7,000 previously allocated, rounded to $28,000.
- Appellate review found a mathematical error in EBITDA calculation (correct three-year average is $36,679.67), but affirmed use of a two multiple given industry conditions and hours worked by husband.
- Court reversed and remanded to correct the amount owed to wife for her half-interest in the business and to reserve future periodic alimony due to potential changes in circumstances.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did court comply with remand mandate on valuation? | Shewbart contends the remand directives were not followed and valuation flawed. | Shewbart argues the court complied, adopting income-approach and considering assets. | Remand complied; valuation error acknowledged (EBITDA math corrected) requiring correction. |
| Whether EBITDA and chosen multiple were properly applied | Income-tax EBITDA understates earnings; Sunday argument for higher earnings and fourx multiple. | Trial court reasonably used two, justified by hours worked and local economy; NORVELL acknowledged four could be arbitrary. | Two as a lower, conservative multiple is supported; not reversible. |
| Amount owed to wife for half-interest in business | Trial court miscalculated value; should be $29,679.67 after correction. | Value offset by prior $7,000 paid; no error in calculation beyond rounding. | Correct value is $73,359.34; wife’s half is $29,679.67; remand to adjust judgment accordingly. |
| Whether periodic alimony should have been awarded | Wife demonstrated need; court should award periodic alimony. | Husband cannot be shown able to pay given earnings; no automatic alimony. | Reversed to reserve future periodic alimony due to potential future changes in circumstances. |
Key Cases Cited
- Ex parte Alabama Power Co., 431 So.2d 151 (Ala. 1983) (remand must follow appellate mandate strictly; no new evidence)
- Clarke v. Clarke, 47 Ala.App. 558, 258 So.2d 902 (Ala. Ct. App. 1972) (judicial notice and economic considerations in valuation)
- First Nat’l Bank of Opp v. Wise, 241 Ala. 481, 3 So.2d 68 (Ala. 1941) (economic conditions may affect valuation considerations)
- Pate v. Guy, 942 So.2d 380 (Ala.Civ.App. 2005) (appellate court may not reweigh evidence)
- Young v. Young, 515 So.2d 32 (Ala.Civ.App. 1987) (appellate deference to trial court findings)
- Edwards v. Edwards, 26 So.3d 1254 (Ala.Civ.App. 2009) (factors guiding alimony determinations)
- Gates v. Gates, 830 So.2d 746 (Ala.Civ.App. 2002) (consider living standard and equity in alimony decisions)
- Hewitt v. Hewitt, 637 So.2d 1382 (Ala.Civ.App. 1994) (discretionary nature of alimony absent need)
- Yohey v. Yohey, 890 So.2d 160 (Ala.Civ.App. 2004) (possible future need to reserve alimony jurisdiction)
- Ashbee v. Ashbee, 431 So.2d 1312 (Ala.Civ.App. 1983) (consideration of all circumstances bearing on fairness)