# FILED October 14, 1998 Cecil W. Crowson Appellate Cou rt Clerk 

### IN THE COURT OF APPEALS OF TENN ESSEE

AT NASHVILLE
CAROLYN VIRGINIA WALLACE, ) ) Plaintiff/Appellee, ) ) Appeal No. ) 01-A-01-9712-CC-00751 VS. ) ) Davidson Circuit ) No. 96D-248 RANDEL EUGENE WALLACE, ) ) Defendant/Appellant. ) APPEALED FROM THE CIRC UIT COURT OF DAVIDSON C

OUNTY AT NASHVILLE, TENNESSEE THE HONORABLE MARIETTA M. SH IPLEY, JUDGE
LOUISE R. FONTECCHIO BRUCE, WEATHERS, CORLEY, DUGHMAN & LYLE 2075 First American Center 315 Deaderick Street Nashville, Tennessee 37238- 2075 Attorney for Plaintiff/Appellee W. A. MOODY MOODY, WHITFIELD & CASTELLARIN 95 White Bridge Road, Suite 509 Nashville, Tennessee 37205 Attorney for Defendant/Appellant

AFFIRMED AND REMAN DED

BEN H. CANTRELL, JUDGE CONCUR: KOCH, J. CAIN, J. 

## O P I N I O N- 2 - This case involves the

value of a CPA firm included in the marital assets. The trial ju dge found the v alue to be $140 ,000. We affirm.

I. Among other assets the parties had accumulated d uring their marriage was an accounting firm that star ted as the wife’s bookkeepi ng business in the late 1970's. Husband, aCPA and a teacher at Nashv ille Tech, began to get i nvolved and do tax work for his wife’s

clients. At first the parties w orked out of their home, but by the time of the divorce they worked out of an office build ing on White Bridge Road. The husband was by then the primary source of the professional serv ices rendered to the clients.
In November of 1994 the husbandpurchased another accounting firm’s clientlist and office assets for approximatel y $100,000. In December of 1995 he filed a fin ancial statement with the b ank showing the val ue of his firm at $260,000. H e testified in the divorce hearing that the personal property in the business was wor

th $64,900 and that the accou nts recei va ble amoun ted to $40,000. The wife testified that in 1995 the husband was considering selling the business and that he valued it at between $310,000 and $350,000. The tri al judge found that the firm was a marital asset and valued it at $140,000.

II.- 3 - We decided in Smith v. Smith , 709 S.W.2d 588 (Tenn. App. 1985) that the good will of a

small law firm was not part of the marital property. It cannot be sold separately from the business,and it is extremely hard to evaluate.
The husband in this case insis ts thatth e same rule applies to his business and that the trial judge’s finding of the value of the business for div ision as martial property included a large portion of the

firm’s good will. We agree that the rule in Smith v. Smith

applies here. But we c annot agree that the

value found by the trial judge included the firm’s good w ill. The record shows

that the husband had an ongoing business which he managed with the help of three or four other employees while teaching full time

at Nashville Tech. In 1 995 he purchased another firm’s cl ient list and other tangible assets for approximately $100,000. The personal property and accounts receivable amounted to approx imately $105,000

at the time of

the divorce. Th ere is evidence in the record that a firm such as this one would sell fo r approximately the amount of its gross receipts for one year. In this case the firm was averaging around $250,000 in gross receipts each year.

With proof showin g t angible assets of $105,000 and a mark et value including its good will of $250,0 00, the trial judge chose to value the firm at $140,000. We think the finding is supported by the record and that it does not include good will.

The judgment of the trialcourt i s affirmed and the cause is remanded to the Circuit Court of Dav idson County for any further proceedings necessary. Tax the costs on appeal to the appellant.

____________________________ BEN H. CANTRELL, JUDGE CONCUR:- 4 -

_____________________________ WILLIAM C. KOCH, JR., JUDGE

_____________________________ WILLIAM B. CAIN, JUDGE