Debra Ann PEARSON
v.
James Leroy PEARSON.
Supreme Court of Mississippi.
*159 Jоhn W. Christopher, Ridgeland, William W. Dreher, Jr., Gulfport, Attorneys for Appellant.
Brehm T. Bell, Bay St. Louis, Andrew M. Jones, Attorneys for Appellee.
EN BANC.
ON MOTION FOR REHEARING
WALLER, Justice, for the Court:
¶ 1. The motion for rehearing is granted. The original opinion is withdrawn, and this opinion is substituted therefor.
STATEMENT OF THE CASE
¶ 2. After filing for divorce, Debra Ann Pearson and James Leroy Pearson consented to a divorce on the ground of irreconcilable differences and agreed for an adjudication by the Chancellor regarding the issues of alimony and division of marital property. The Chancellor, in making an equitable distribution of marital property, ordered Dеbra to convey to James her title in three parcels of real property and a 1997 Suburban vehicle. The Chancellor awarded Debra $150,000 in lump sum alimony and in settlement of any rights to marital property to which she might have *160 a claim. Debra raises three issues on appeal, and James has cross-appealed as to one issue:
I. Whether the Court committed manifest and reversible error in its finding that there were no marital assets and that all of the assets of the parties were the separate estate of James Pearson and therеupon ordered Debra Ann Pearson to convey unto James Pearson all of her right, title and interest in and to three parcels of real property and to transfer her title to a 1997 Suburban vehicle.
II. Whether the Court committed manifest and reversible error in failing to make an equitable division of marital assets.
III. Whether the Chancery Court's award of lump sum alimony in the sum of $150,000 was manifest error or an abuse of discretion. (Debra claims the amount is grossly inadequate, while James claims it is grossly excessive.)
STATEMENT OF THE FACTS[1]
¶ 3. Debra and James met in 1989 and lived together approximatеly six months before they were married on November 21, 1991. There were no children born of the marriage. In the 6½ years that the couple were married, they separated approximately 10 times. James claimed Debra left him each time the couple separated. Debra claimed she left James only four or five times and that she left him as the result of verbal or physical abuse. She could not recall how the other separations occurred. James admitted to having slapped Debra once in April of 1997 after she had punched him during a dispute. He claimed that Debra left him because she would get angry and irrational over trivial matters.
¶ 4. James was 49 years old at the time of trial and is retired from the sea-clamming business. He began clamming at age 13, working as a deck-hand for his father and others until he was 27. He then bought his first boat, using his savings as a down-payment, and went into business for himself. James was very successful in the clamming business and bought and sold several boats. In 1984, James formed a corporation with Warren Alexander known as "Alexander and Pearson," and the two of them purchased a number of large seagoing vessels to clam far offshore in the Atlantic Northeast. Shortly after the formation of the business, and prior to James and Debra's marriage, James was earning annual income of $200,000 to $250,000.
¶ 5. Pursuant to a new law effective in 1990, "Amendment 8 of the Magnusson Act," clam fishermen were awarded licenses known as "allocations" to clam a certain limit of bushels of clams. Allocations were based entirely on the history of a particular vessel in the clamming industry. James, who had enjoyed a long and fruitful career in the clamming business, was awarded, along with his partner, some 25% of the total allocations allowed.
¶ 6. From 1990 to 1993, James's income remained constant. However, in 1993, James and his partner decided to dissolve their corporation in a tax-free equal division of the assets. Pursuant to the dissolution agreement, James received allocations, a boat, and cash and other assets of around $4 million. James formed a corporation, Pearson Boys, Inc., to receive his share of the assets. From 1993 to 1997, James leased the boat and his share of the allocations back to Alexander for $125,000 quarterly, doubling his average annual income.
¶ 7. All of Pearson Boys' assets were acquired prior to James and Debra's marriage with the exception of approximately $354,000 worth of allocations purchased after *161 the marriage but exclusively with Pearson Boys funds.
¶ 8. In January of 1997, James sold all of the assets of Pearson Boys and officially retired from the clamming business. Pearson Boys, of which James continued as sole shareholder, received $4.8 million in proceeds. James, through his company, paid $1.3 million in taxes, paid off all existing mortgages and other debts, built two commercial shrimp boats for his sons, acquired several vehicles, and made other miscellaneous purchases, leaving a balance of $1.8 million, still held in a Pearson Boys' account.
¶ 9. Debra was a bartender when she met James. She quit her job after she married James and has not held any steady employment since then. She claimed that James preferred that she not work, especially during the period of time (approximately a year and a half) that one of James's sons, who is mentally retarded and now lives at a school, lived with them. Debra testified that she looked after the boy while hе lived with them. James, however, testified that Debra had little patience with the boy and that James was the primary caregiver, which was why he sent the boy to live at a school for children with special needs.
¶ 10. Debra further testified that she took care of business affairs, such as payroll duties, keeping ledgers, and correspondence with the accountant for Pearson Boys. James, however, claimed that Pearson Boys was a mere holding company and that Debra's responsibilities amounted to nothing more than paying personal bills and helping tо collect documents in preparation for filing the annual tax return. This testimony was corroborated by his attorney who testified that he (the attorney) collected all of the allocations and performed any other duties relating to the clamming business.
¶ 11. According to testimony, three parcels of real property were identified as having been purchased during the marriage by James and titled jointly in the names of James and Debra: (1) a house and land in Grand Bay, Alabama; (2) a duplex in Spanish Fort, Alabama; and (3) a modular home in Odessa, Florida. No doсumentary evidence was offered at trial to prove the ownership of the listed property, but, as the Chancellor concluded, we assume that this property was indeed titled as presented in testimony. Likewise, there was no proof offered as to the value of the property, or whether any of the real property was claimed as homestead. There were also two vehicles, a 1997 Suburban and a 1997 Expedition, titled in her name. James drove the Suburban, and Debra drove the Expedition. All of these listed assets were purchased by Pearson Boys.
¶ 12. Debra took large sums of money from James on three occasions when she left him. Once she took $20,000 in cash and charged an additional $16,000 to his credit card. On another occasion, she took $19,000 in cash. On their final separation, Debra took $30,000 from the Pearson Boys account and $7,000 from the joint checking account. She also kept her 1997 Expedition, valued at $32,000, and other personalty.
¶ 13. The Chancellor found that there were no marital assets as Debra did not contribute financially to the marriage, and all of the couple's assеts were derived from James's career in the clamming business. However, looking at this Court's precedents regarding commingled assets, or the income derived from non-marital assets, the Chancellor looked to the factors of equitable distributions. See Ferguson v. Ferguson,
STANDARD OF REVIEW
¶ 14. "Our scope of review in domestic relations matters is limited by our familiar substantial evidence/manifest error rule." Magee v. Magee,
DISCUSSION
I. Whether the Court committed manifest and reversible error in its finding that there were no marital assets and that all of the assets of the parties were the separate estate of James Pearson and thereupon ordered Debra Ann Pearson to convey unto James Pearson all of her right, title and interest in and to three parcels of real property and to transfer her title to a 1997 Suburban vehicle.
¶ 15. The Chancellor correctly reviewed this Court's decisions regarding marital property. In Ferguson v. Ferguson,
¶ 16. Debra argues that, by titling the property jointly (or exclusively as in the case of the Suburban) in her name, James created a rebuttable presumption that he had gifted an equitable portion of the estate to Debra. In support of her argument, Debra cites Miller v. Miller,
If, as contended by appellant, his cash contributions over the sixteen year period of the marriage substantially exceeded those of the appelleе, the circumstances of the case [joint title] created a presumption that it was intended on his part that an equal interest in the property conveyed should go to appellee as a gift, notwithstanding a discrepancy in cash contributions. This presumption can be overcome only by clear and convincing proof to the contrary.
Id. In Johnson, the Court also applied a gift presumption to jointly titled property, *163 saying "we begin with the presumption that co-owners of jointly held property are equal co-contributors and owners. Where in acquiring such property one spouse has made substantially larger cash contributions, we presume that spouse has given a one-half interest to the other."
The primary thrust of Hemsley was to lessen the importance of which spouse held legal title to marital property when winding up the financial aspects of a dissolving marriage. Essentially all of the benefits arising from that case would be lost if the chancellor were, in every сase, faced with a claim that the non-titled spouse agreed to vest title in the other spouse as a gift. Therefore, we hold that interspousal transfers of marital property during the marriage may not be used to support a claim that the transfer was a gift intended to deprive the property of its status as a marital asset.
¶ 17. We are not unmindful that this Court has applied a title or gift presumption in recent years. In Sarver v. Sarver,
¶ 18. In the present case, the Chancellor likewise looked to the marital character of the subject property. Specifically, the Chancellor found that the subject property may have been maritаl in nature because the property was commingled; however, the evidence clearly showed that all of the assets of the marriage were acquired through Pearson Boys, a holding company for James's pre-marital assets. The Chancellor *164 did go through this Court's pronouncement of considerations for equitable distribution of marital assets. See Ferguson,
¶ 19. Even considering that equity favored no division of property for Debra, the Chancellor decided that Debra should keep the 1997 Expеdition and the funds she had taken from James, assets worth a total of $61,000, and be awarded $150,000 lump-sum alimony in settlement of any and all claims she might have to real property. That award to Debra is equitable in light of the Chancellor's stated findings and cannot be considered manifestly erroneous. The Chancellor did not err in divesting Debra of title or in awarding her a portion of the value of the property in lump-sum alimony. The Chancellor was limited in his evaluation of the property for purposes of making an equitable distribution as there was no proof offered of thе value of the subject property. This issue is without merit.
II. Whether the Court committed manifest and reversible error in failing to make an equitable division of marital assets.
¶ 20. Under this assignment of error, Debra argues that James's property may be subject to equitable distribution because he used Pearson Boys funds for regular household expenses, and thus commingled a marital asset with a non-marital asset. See Tillman v. Tillman,
¶ 21. This Court has recently addressed this issue in A & L, Inc. v. Grantham,
¶ 22. Grantham is distinguishable from the case at hand because not only did the husband there use the corрorations' assets to fund normal marital expenses, his actions in regards to the corporations throughout the marriage caused an increase in value of the corporations. Specifically, the Court stated in Grantham that "the evidence before the Court in the instant case suggests that there was a substantial increase in the net assets of the corporations due at least in part to John's managerial effort. That increase in value, like John's other earnings, is considered a marital asset." Id. In the present case, however, the Chancellor found that no assets were accumulated during the marriage and that technically Pearson Boys lost assets. In addition, James kept the Pearson Boys assets separate; there is no question that the Chancellor was correct in not distributing any of the Pearson Boys assets to Debra.
¶ 23. Relying on Grantham, we are hard pressed to distinguish the marital home purchased with corporate funds in that case to the real property and vehicles at issue in this case. As to the subject property, James may have commingled the corporate assets to the extеnt that they may be considered marital property.
¶ 24. That finding alone, however, does not entitle Debra to a one-half interest in the property. Because the property is a marital asset, it is subject to equitable distribution. We have never held equitable distribution to mean an equal division. As stated above, the Chancellor in this case considered the equitable division of the subject property and made an award of lump-sum alimony to compensate Debra for her interest. There is no manifest or reversible error in this issue.
III. Whether the Chancery Court's award of lump sum alimony in the sum of $150,000, and no periodic alimony, was manifest error or an abuse of discretion. (Debra claims the lump sum alimony amount is grossly inadequate, while James claims it is grossly excessive.)
¶ 25. "Whether to award alimony and the amount of alimony are largely within the discretion of the chancellor." Parsons v. Parsons,
¶ 26. The following factors are to be considered by the Chancellor in making findings of fact and conclusions of law and in entering judgmеnt 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 marriage 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,
¶ 27. Debra is a 36 year-old woman in good health and capable of working. She testified that she would like to go to college, get a degree, and enter the work force. Debra has no children to support. She did not contribute to the financial stability of the marriage; in fact, she frequently left the marriage, taking large sums of money with her. The marriage was of relatively short duration. While Debra enjoyed a high standard of living when she was with James, there is no reason to believe that an alimony award of $150,000 will not allow her to obtain an education and become self-supportive, her stated intention.
¶ 28. The Chancellor did not err in awarding a lump-sum payment instead of periodic alimony. He has great discretion in determining the amount and type of alimony, and should do so in a way to bring finality to the economic relationship of the parties, as justice and equity require. See Ferguson,
¶ 29. On cross-appeal James contends that the Chancellor's award of $150,000, in addition to the $24,000 temporary alimony, the Expedition, and the $37,000 cash that Debra took upon leaving James, is really an award of $240,000, a grossly excessive amount. However, given the disparity of the estates of the parties, this argument has no merit. Even though James is physically unable to work now and has оnly an eighth grade education, he still has a substantial estate with which to retire. Even an award of $240,000 to his former wife to help her get established is not grossly excessive.
CONCLUSION
¶ 30. The Chancellor has great discretion in determining alimony awards and property settlement. His judgment should not be reversed absent a showing of abuse of discretion or manifest error. In this case, the Chancellor made a careful consideration of the facts and circumstances of the parties' marriage, as well as the equities involved, as documented in his lengthy and well-written Findings of Fact and Conclusions of Law. The Chancellor did not err in his determinations. Therefore, the judgment of the Hancock County Chancery Court is affirmed.
¶ 31. AFFIRMED ON DIRECT APPEAL AND CROSS-APPEAL.
PITTMAN, P.J., SMITH, MILLS, COBB AND DIAZ, JJ., CONCUR. McRAE, J., CONCURS IN RESULT ONLY. BANKS, P.J., CONCURS IN PART WITH SEPARATE WRITTEN OPINION JOINED BY PRATHER, C.J.
BANKS, Presiding Justice, concurring in part:
¶ 32. I agree with the result reached by the majority because, in my view, the distribution of the assets here is equitable, taking all factors into consideration.
¶ 33. I write separately because I disagree that Ferguson v. Ferguson,
¶ 34. The distinction to be made is with regard to the purpose. Property may become marital regardless of title. In order to become marital property, a spouse has only to acquire an ownership interest in the non-marital property during the marriage. *167 See Jones v. Jones,
¶ 35. I concede that in a situation similar to that which is now before the Court, this Court in Devore v. Devore,
¶ 36. In Devore, strong evidence suggested that placing title in the non-owning spouse's name was in the nature of a contract for which the non-owning spouse failed to render the agreed consideration. Additionally there as here, considering the property as "marital" would have been of little consequence as equity would not dictate that the previously non-owning spouse should be awarded part thereof.
¶ 37. In any event, I adhere to the views expressed in Devore by Chief Justice Prather in her concurring opinion, that co-titling the property ordinarily makes it marital, despite the fact that equitable distribution factors may dictate that the previously untitled spouse does not receive a share of the property.
¶ 38. In my view, therefore, the property co-titled in Mrs. Pearson's name became marital property subject to equitable distribution.
PRATHER, C.J., JOINS THIS OPINION.
NOTES
Notes
[1] The statement of the facts is taken almost exclusively from the thorough and well-written Findings and Facts and Conclusions of Law by Chancellor J.N. Randall, Jr.
