Lead Opinion
FOR THE COURT:
¶ 1. This is the second appeal of the equitable distribution of assets of Howard Carney III and Andrea Bell Carney by the Chancery Court of Warren County. In the first appeal, this Court reversed and remanded, holding that the chancellor manifestly had erred by awarding 100% of the equity in the marital home to the wife, in the absence of an explanation for that award. Carney v. Carney,
FACTS
¶2. The parties were married on November 20, 1998. The couple had two children, Amanda Leigh Carney, born in June 1999, and Katherine Emily Carney, born in June 2006. They purchased what was to be their marital home, known as the “Bell property,” in 2006. The house, which had been constructed in 1937, was the former home of the wife’s grandparents and father. Later, it was purchased by the wife’s sister, Patricia Barnes. But after Patricia Barnes passed away unexpectedly in 2004, her widowed husband placed the Bell property on the market.
¶ 3. Patricia Barnes had designated her sister, Andrea Carney, beneficiary of her $176,000 life insurance policy. Although the Carneys wanted to purchase the Bell property, the life insurance proceeds would not cover the full purchase price, and they were unable to obtain financing for the remaining amount. So another of Andrea Carney’s sisters, Debra, and her husband, Bob Bayler, purchased the Bell property for $279,000 and rented it to Andrea and Howard Carney. Andrea paid the Baylers $165,000 from the life insurance proceeds as a down payment on the home. The Baylers financed the remainder of the purchase price with River Hills Bank, and they paid the mortgage installments using the Carneys’ monthly rental payments.
¶ 4. On May 8, 2006, Andrea and Howard Carney borrowed $70,000 from Tensas State Bank. Of those funds, they used $54,102.13 to pay off the balance of the Baylers’ mortgage with River Hills Bank. They placed the remaining $14,925.87 in a joint account. On May 8, 2006, Andrea, Howard, and the Baylers executed a settlement statement and the Baylers executed a warranty deed that conveyed the Bell property to Andrea Carney. Later, the Carneys placed a second mortgage on the Bell property for $10,030 to pay bills.
¶5. Howard and Andrea Carney separated on December 1, 2008. Andrea filed a complaint for divorce in December 2008, alleging grounds of habitual cruel and inhuman treatment, and/or irreconcilable differences, and in September 2009 she filed an amended complaint adding the ground of adultery. Howard Carney filed a coun-tercomplaint for divorce on the grounds of habitual cruel and inhuman treatment, adultery, and/or irreconcilable differences. The chancery court entered a temporary order in March 2009 that granted Andrea Carney custody of the children and $2,000 per month in child support and temporary maintenance. On January 13, 2010, the parties filed a consent to a joint withdrawal of fault grounds, requesting an irreconcilable differences divorce. The parties asked that the chancellor determine the issues of child support, property division, alimony, and attorney fees.
¶ 6. On March 19, 2010, the chancellor entered a final judgment granting an irreconcilable differences divorce and equitably dividing the parties’ assets under Ferguson v. Ferguson,
¶7. The chancellor deemed the Bell property a marital asset and determined that, at the time of the divorce, the Carneys’ first mortgage had a remaining balance of $64,399.29, and their second mortgage had a remaining balance of $3,348.14. On May 28, 2009, the Bell property was appraised for $253,800, leaving equity of $186,052.57, after subtraction of the mortgage balances. The chancellor awarded Andrea Carney title to-the property, possession of the property, and the entire $186,052.57 in equity.
¶ 8. The chancellor also found that, under the factors from Armstrong v. Armstrong,
¶ 10. Howard Carney filed a petition for certiorari, which this Court granted. Carney,
The chancellor found the “Bell Property” was marital property under the commingling-of-assets and marital-use doctrines. Hemsley v. Hemsley,639 So.2d 909 (Miss. 1994) .... On this basis, the chancellor found that the home was a marital asset. But the chancellor did not allot Howard any share in the home’s equity. This created a significant disparity in the division of the marital estate. Further, by absolving Andrea from obligations on the second mortgage’s remaining balance and assigning the balance to Howard, the chancellor’s division resulted in even a greater disparity than that indicated in the above fact portion of this opinion. Technically, since this debt followed Howard, Andrea was awarded $189,400.71 in equity, not $186,052.57.
In dividing the marital estate, the chancellor conducted a thorough Ferguson analysis for the record. But we can find no explanation and/or justification therein for the disparity that resulted in the marital-éstate division. ... And it appears to this Court that the chancellor, perhaps unintentionally, but nonetheless ultimately, treated those funds as nonmarital. This was manifest error. Having found that those funds were commingled with the marital estate, the chancellor was required to treat those funds as marital and-to distribute and/or consider them equitably under the Ferguson factors.
[W]e iterate that awarding 100 percent equity in a marital asset to one party is not error per se. But, in this instance, based on the record before this Court, we are unable to ascertain why the chancery court awarded the entire equity of the marital home solely to Andrea, without awarding Howard some other equitable share in the marital estate or equitable relief from the marital debt. Accordingly, we reverse and remand this matter for further proceedings consistent with this opinion.'
Id. at 438-39.
¶ 11. On remand, the chancellor again awarded all of the equity in the marital
¶ 12. Then, the chancellor made new findings on the Ferguson factors. Following those factors, the chancellor must consider the following:
(1) Substantial contribution to the accumulation of the property. Factors to be considered in determining contribution are as follows: (a) Direct or indirect economic contribution to the acquisition of the property; (b) Contribution to the stability and harmony of the marital and family relationships as measured by quality, quantity of time spent on family duties and duration of the marriage; (c) Contribution to the education, training or other accomplishment bearing on the earning power of the spouse accumulating the assets.
(2) The degree to which each spouse has expended, withdrawn or otherwise disposed of marital assets and any prior distribution of such assets by agreement, decree or otherwise.
(3) The market value and the emotional value of assets subject to distribution.
(4) The value of assets not ordinarily, absent equitable factors to the contrary, subject to such distribution, such as property brought to the marriage by the parties and property acquired by inheritance or inter vivos gift by or to an individual spouse;
(5) Tax and other economic consequences, and contractual or legal consequences to third parties, of the proposed distribution;
(6) The extent to which property division may, with equity to both parties, be utilize d to eliminate periodic payments and other potential sources of future friction between the parties;.
(7) The needs of the parties for financial security with due regard to the combination of assets, income, and earning capacity; and
(8) Any other factor which in equity should be considered.
Ferguson,
¶ 13. In her findings on the Ferguson factors in the judgment after remand, the chancellor added new findings to her original ones, as follows:
(1)Substantial contribution to the accumulation of the property.
(a) Direct or indirect contribution to the acquisition of the property.
¶ 14. In the original judgment, the chancellor had recognized that both parties had contributed money to a joint account from which they had purchased materials for the house, and that both parties had pei*-formed labor on the house. In the judgment after remand, the chancellor additionally found that Andrea Carney had contributed $165,000 to the acquisition of the marital home, and had paid the mortgage, insurance, and tax payments, while Howard Carney had contributed to the home’s upkeep. The chancellor also recognized that both parties had placed their incomes into the joint account for marital expenses.
(b) Contribution to the stability and harmony of the marital and family relationships as measured by the quality and quantity of time spent on family duties and duration of the marriage.
¶ 15. In both judgments, the chancellor found that the parties had been married for ten years before separating, and that the husband’s travel for his employment had strained the marital relationship.
(c)Contribution to the education, training or other accomplishment bearing on the earning power of the spouse accumulating the assets.
¶ 16. The chancellor again found that no evidence had beén offered on this factor.
(2) The degree to which each spouse has expended, withdrawn or otherwise disposed of marital assets and any prior distribution of such assets by agreement, decree or otherwise.
¶ 17. The chancellor again found that no evidence had been offered on this factor.
(3) The market value and the emotional value of the assets subject to distribution.
¶ 18. The chancellor again found that “Mrs. Carney has strong emotional ties to the marital home as it was the family ‘Bell’ home of her paternal grandmother,” and that the market value of the assets subject to distribution was $237,503.72. In the judgment after remand, the chancellor added that the parties had' lived in the marital home for about four years-before their separation.
(4) The value of assets not ordinarily; absent equitable factors to the contrary, subject to distribution.
¶ 19. The chancellor again found that the wife had a Smith Barney account with a present value of $19,759, and nonmarital furniture with an appraised value of $1,480.
(5) Tax and other economic consequences, and contractual or legal consequences to third parties, of the proposed distribution.
¶20. The chancellor’s findings on this factor did not change. The chancellor found that-the balance on the first mortgage was $64,399,29, and the balance on the second mortgage was $3,348.14. The chancellor found that the balance on a 2005 Chevrolet truck was $10,712.20, that the
(6) The extent to which property division may, with equity to both • parties, be utilized to eliminate periodic payments and other potential sources of future friction between the parties.
¶21. Again, the chancellor found that the parties lacked sufficient assets that could be used to eliminate the need for periodic alimony. In the judgment after remand, the chancellor added that “the property division eliminates the need for lump sum alimony to be paid to Mrs. Carney.” ' ^
(7) The needs of the parties for financial security with due regard to the combination of assets, income and earning capacity.
¶22. The chancellor again found that Andrea Carney was currently employed by the Louisiana Department of Corrections, and Howard Carney was currently employed by the State of Louisiana as a college welding instructor. In the judgment after remand, the chancellor additionally found that, although the wife had a higher salary than the husband, she also had higher monthly expenses. The chancellor added that Andrea Carney has non-marital assets totaling $21,239, including the Smith Barney account and the non-marital furniture.
(8) Any other factor which in ; equity should be considered.
¶ 23. In both judgments, the chancellor found that no other specific factors warranted consideration.
¶ 24. The chancellor made no further findings regarding alimony but stated that the wife’s request for alimony was “denied in light of the equitable division of the marital assets.”
STANDARD OF REVIEW
¶ 25. “This Court employs a limited standard of review of property division and distribution in divorce cases.” Bowen v. Bowen,
ANALYSIS
WHETHER THE CHANCELLOR’S AWARD OF THE EQUITY IN THE MARITAL HOME TO ANDREA CARNEY RENDERED THE EQUITABLE DISTRIBUTION CLEARLY ERRONEOUS.
¶ 26. Howard Carney contends that the equitable distribution performed by the chancellor on remand was clearly erroneous. He complains that, except for assessing the second mortgage against the wife, the chancellor’s equitable distribution after remand did not change. He avers that the equitable distribution after remand bestowed 93% of the marital assets upon Andrea Carney, leaving him with a mere 7%. He argues that the chancellor again erroneously treated the $165,000 in life insurance proceeds as the wife’s separate property despite this Court’s admonition that the funds could not be treated as her separate property due to commingling. He also avers that the chancellor’s decision to award all of .the equity to his former
if 27. When conducting a property division in a divorce case; the chancellor first must classify each asset as marital or nonmarital. Johnson v. Johnson,
¶ 28. If, after equitable division, an equitable deficit exists, the' chancellor then should consider alimony. Rogillio v. Rogillio,
Lump-sum alimony can serve two distinct purposes. The first purpose is to aid the chancellor in equitably dividing the marital estate under the Ferguson factors. See Haney [v. Haney ],907 So.2d 948 [ (Miss. 2005) ]. The second purpose is to aid the chancellor in correcting an equitable deficit, resulting from the equitable distribution of the marital estate under the Armstrong factors. See Rogillio v. Rogillio,57 So.3d 1246 , 1249 (Miss. 2011).
Davenport v. Davenport,
¶ 29. We reject Howard Carney’s argument that the chancellor treated the life insurance proceeds as the wife’s separate property. In the judgment on remand, the chancellor expressly recognized this Court’s concern that, in the original judgment, she, perhaps unintentionally, had treated the life insurance proceeds as non-marital. Therefore, the chancellor made clear that she had awarded the equity in the marital home to the wife as part of the equitable distribution of the marital assets under the Ferguson factors. Thus, the chancellor did not treat the life insurance proceeds as the wife’s separate property in the judgment on remand.
¶ 30. And, in the judgment on remand, the chancellor also made additional findings explaining the reasons for the award. First, the chancellor found that the wife had made a substantial contribution to the acquisition of the marital home because she had contributed $165,000 in life insurance proceeds to the marital estate that then were used as the down payment on the home. In Singley v. Singley, 846 So.2d
Id. (citing Henderson v. Henderson,
¶ 31. The Court of Appeals applied Singley in Allgood v. Allgood,
Singley, “[a] chancellor possesses the discretion to adjust equitably the Ferguson distribution in recognition -of a separate contribution of a spouse;” and “[t]his Court can find no abuse of discretion in allowing [the husband] credit for the inherited funds used to pay off the mortgage.” Id. at 448-49. Under Singley and Allgood, the chancellor did not err by crediting Andrea Carney, in the Ferguson analysis, with her sizeable contribution to the marital home.
¶32. The chancellor also considered Andrea Carney’s significant emotional connection to the marital home. Under Ferguson, the emotional value of the marital home should be considered, if relevant. Ferguson,
¶33. The chancellor also placed significant weight on the sixth Ferguson factor, which is “the extent to which property division may, with equity to both parties, be utilized to eliminate periodic payments and other potential sources of future friction between the parties.” Ferguson, 639
¶ 34: In the original judgment, in denying Andrea Carney’s request for alimony, the chancellor made certain fact findings on alimony which were incorporated in their entirety into the judgment on remand. First, the chancellor found that, under the factors from Armstrong v. Armstrong,
¶ 35. The factors cited in Tilley v. Tilley for the determination of lump sum alimony were gleaned from Cheatham v. Cheatham,
¶ 36. We turn to the chancellor’s analysis of the sixth Ferguson factor and the determination that the wife should receive the equity in the Bell property to avoid an award of lump sum alimony. In denying Andrea Carney’s request for alimony, the chancellor found that she was entitled to periodic alimony, but that no liquid assets were available to fund such an award. In her Ferguson analysis, the chancellor stated that “the court considered awarding [Howard Carney] a percentage of the equity in the home and awarding [Andrea Carney] lump sum alimony. The court instead equitably divided the assets of the parties and was able to completely eliminate any alimony award.”
¶ 37. Howard argues that the chancellor’s analysis of this factor was erroneous because the facts did not support the chancellor’s finding that Andrea Carney was entitled to periodic alimony. In the Armstrong analysis, the chancellor found that the parties had no significant income disparity and that both parties’ expenses exceeded their incomes. But the chancellor found that, because the wife had custody of the two minor children, whose reasonable needs exceeded her income, she
¶38. The father’s argument assumes that, but for the finding that the mother was entitled to alimony, the chancellor would have awarded him half the equity in the house, totaling approximately $93,000. But as explained above, under Singley and Allgood, the chancellor was entitled to weigh Andrea Carney’s substantial contribution of $165,000 toward the purchase of the marital home in her favor in the equitable distribution. We note that, if $165,000 is deducted from the $186,052,57 in equity, $21,052.57 remains. The chancellor 'articulated that, if she had given some of the equity to Howard in the Ferguson analysis, she would have ordered him to pay alimony. Given the reality that both parties’ expenses exceeded their incomes and Andrea Carney had greater expenses due to her custody of the minor children, the chancellor’s finding that the award of the equity to her negated the need for alimony was not manifestly erroneous. While the dissent, would reverse. because there-was no income disparity and the wife’s separate estate was larger, the considerations discussed above demonstrate that the chancellor’s findings on Ferguson’s alimony factor were not manifestly erroneous.
¶39. In summary, the chancellor was not manifestly wrong in awarding Andrea Carney all of the equity in the marital home under Ferguson given her substantial contribution to the acquisition of the home, her , emotional attachment to the home, and the fact that the award.eliminated the need .for alimony. Because , the chancellor’s Ferguson analysis .and findings.complied with the Ferguson principles and were within the chancellors discretion, “we are duty bound to let [the] distribution stand.” Phillips,
CONCLUSION
¶ 40. On remand, the chancellor adequately justified her award of the equity in the Bell property to Andrea Carney and the chancellor’s equitable division of the marital property was not manifestly wrong or clearly erroneous. Therefore, we affirm the judgment of the Chancery Court of Warren County.
¶ 41. AFFIRMED.
Notes
.’ The facts of the case are taken largely from the prior opinion of this Court. Carney,
. The chancellor distributed the assets and debts as follows:
Wife was awarded the following marital assets:
Marital Home: $186,052.57 in equity
Marital Household Furnishings: $5,175.00
2002 Toyota Sequoia: $7,170.00
TSB Checking; $53.00
RHB Checking: $800,00
DOC-CU Savings: $800.00
State of LA Retirement: $24,000.00
Total: $224,050.57
Wife was required to pay the following debts:
First Mortgage with Tensas State Bank: $64,399.29
Capital One: $2,307.04
HSBC: $186,80
Total: $66,893.13
Husband was awarded the following assets:
2005 Chevrolet Truck: $327.80 in equity
2007 Travel Trailer: $3,677.12 in equity
Social Security Benefits: Actual Value Unknown
TSB Checking: $875.21
TSB Savings: $43.52
40IK: $7,279.50
Tools: $1,250.00
Total: $13,453.15
Husband was ordered to pay the following debts:
2005 Chevrolet Truck: $10,712.20
20.07 Travel Trailer: $12,712.88
Jon Barry & Assoc.: $551.42
Second Mortgage-with Tensas State Bank: $3,348.14
Capital One: $2,765.65
Orchard Bank: $1,765.00
Total: $31,855.29
. .In Armstrong, this Court held that "[t]he following factors are to be considered by the chancellor in arriving at findings and entering judgment for alimony:”
1. The income and expenses of the parties; 2. The health and earning capacities of the parties; 3. The needs of each party; 4. The obligations and-assets of each party; 5. The length of the marriage; 6. The presence or absence of minor children in the home, Which may require that one or both of the parties either pay, or personally provide, child care; 7- The age of the parties; 8. The standard of. living of the. parties, both during the marriqge and. at the time of the support determination; 9: The tax consequences of the spousal 'support order; 10. Fault or misconduct; 11. Wasteful dissipation of assets by either party; or 12. Any other factor deemed by the court to be "just and equitable” in connection with the setting of spousal support.
Armstrong v. Armstrong,
Dissenting Opinion
DISSENTING:
¶ 42. The majority and the chancellor justify this inequitable property distribution based on the theory that, had Andrea Carney not been awarded all of the equity in the marital home, she would have been awarded lump-sum alimony. Because Andrea Carney was not entitled to lump-sum alimony, I respectfully dissent.
ÍI44. The chancellor did not use lump-sum alimony to aid in the equitable division of the marital property, and Andrea was not left with a deficit after the distribution of the marital estate. Howard Carney, on the other hand, was left with an extreme deficit, so if anyone was entitled to lump-sum alimony it would have been him. Furthermore, the chancellor found that Andrea’s .monthly income, with child support, amounted to $4,065.04, while Howard’s monthly income amounted to $2,936.60. She also found the both Howard and Andrea have expenses that, exceed their monthly incomes.
¶45. In Cheatham v. Cheatham,
¶ 46. Because under this Court’s precedent I believe that Andrea Carney was not entitled to lump-sum alimony, I respectfully dissent.
LAMAR, J., JOINS THIS OPINION.
. Davenport v. Davenport,
. Id.; see Haney v. Haney,
. Id.; see Rogillio v. Rogillio,
. Cheatham v. Cheatham,
.Id.