### IN THE COURT OF APPEALS OF TENNESSEE AT JACKSON June 19, 2001 Session

PATSY HILL OAKLEY v. JAMES SPEN CER OAKLEY

Direct Appeal from the Circuit Court for Shelby County No. 157480 R.D. George H. Brown, Jr., Judge

No. W2000-02033-COA-R3-CV - Filed August 10, 2001

This appeal arises from a divorc e action. Husband and Wife divorced after 22 years of mar riage. Both had received prop ert y by bequest during the marriage. Husband had received stocks and

securities,real property, and Company, whic h he owned and operated. Wife received propert y which shesubsequently

sold. The proceeds of these saleswere deposited in a separate investment account after first passing through a marital checking account and were later used

to buy Condo. The trial
court specifically found that Wife had not substantially contributed to appre ciation of stocks and securities, but awarded her

25% of their appr

eciation. The ap

preciation of Hu

sband’s real pro

perty

was found to be marital property, as well as the entire value of Company. Wife’s Condo was found to be separate property. We affirm in part, reverse in pa rt, modify and remand.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court is Affirmed in part;

Reversed in part; Modified; and Remanded

D AVID R. F ARMER , J., delivered the opinion of the court, in which W. F RANK C RAWFORD , P.J., W.S., and H OLLY K. L ILLARD , J., joined.

D avid E. Caywood and Cynthia L. McLendon, Memphis, Tennessee, for the appellant, Jame s Spencer Oakley.

James O. Parker and Sam Blaiss, Memphis, Tennessee, for the appellee, Patsy Hill Oakley.

OPINION

In 1997, Patsy Oakley

filed a Complaint for Divorce against James Oakley, her husband of twenty-two years . Ms. Oakle y had been a homem aker for the d uration ofthe marriage , though she was involved in the buying and selling of antiques on an irreg ular basis. Mr. Oakley was the owner and operator of Oakley Frames, a framing business. The couple had two children, one being a minor at the time of the divorce.1 Mr. Oakley’s mother gifted Oakl

ey Frames to hi

m six months before

her death.

-2- At the time t he Com plain t for D ivorc e was f iled, the co uple o wned v ariou s asse ts. In addition to Oakley Frames, Mr. Oakley owned a substantial stock portfolio and two residential properties. Mr. Oakley had inherited most of these assets in 1986 upon the death of his mother. 1 Ms. Oakley owned a condominium in Florida. This property had been purchased in July, 1997, with money from a Merrill Ly nch account. This account contained funds Ms. Oakley had inherited from her mother and aunt. However, Ms. Oakley had made a down payment for her condo from Merri

ll Lynch funds which she ini

tially place

d into a joint marita

l checking acc

ount.
The trial court found that the appreciation of Mr. Oakley’s two residential prope rties and Oakley Fr amers were mar

ital property. In addition, t he court found Ms.

Oakley wa

s entitled to 25% of the appreciation of her husband’s stock portfolio. Ms. Oakley was aw arded her Florida condominium as sepa

rate property

. In addition, M

s. Oakley w

as awarded $375

per month in ali mon y in futuro , $1000 per month fo r 48 months as reha

bilitative alimony

, and $65,000 in ali mon y in solido . This appeal followed.

The issues, as we p

erceive them, a

re as follows:

I. Did the tri al c our t er r in awar din g Ms. Oak ley b oth ali mon y in futuro

, reha bil ita tiv e al imo ny an d al imo ny in solido of $65,000?

II. Did the trial court err in its division of marital property through its award to Ms. Oakley

of 25% of Mr. Oakl

ey’s stocks

and securities, i

ts classification of the appreciation of several real properties in Memphis and Oakley Fr amers in its entire

ty as marita

l property,

and its finding tha

t a Florida condomin

ium recently

purchased by

Ms. Oakley w

as separate pro pert y?

To the extent that these issues involve questions of fact, our review of the trial court’s ruling is de novo with a presumption of correctness. See Ten n. R . Ap p. P . 13 (d) . Ac cord ingl y, we may not reverse the court’s factual findings unless they are contrary to the preponderance of the evidence. See, e.g., Randolph v. Randolph , 937 S.W.2d 815, 819 (T enn. 1996); Tenn.

R. App. P. 13(d). With re

spect to the court

’s legal conclu

sions, however, o

ur review is de novo with no presumption of correctness. See, e.g., Bell ex rel. Snyder v. Icar

d, Merrill, Cullis, Timm, Furen and Ginsburg, P.A. , 986 S.W.2d 550, 554 (Tenn. 1999); Tenn. R. App. P. 13(d).

Alimony Award

If an award

of rehabilitative

alimony is just

ified by the

parties' circumstances, a trial court initially should award rehabilitative alimony only. An award of rehabilitative alimony pursuant to Tenn. Code Ann. § 36-5-101 must be2 Mr. Oa kley did n ot dispute th is amou nt.

-3-

predicated upon a finding that the recipient can be economically rehabilitated. Once awarded,

rehabilitative a

limony may

be modified if the r

ecipient's pros

pects for economic rehabilitation materially change. I f rehabilitation is not feasible, the trial court may then make an award of alimony in futuro. Accordingly, a concurrent award of both types of alimony is inconsistent. At the time of the decree, a trial court must necessarily find that the recipient of a limony either can be or cannot be rehabilitated although that determination is subject to later modification. Allowing concurrent awards of alimony in futuro and reha bilitative alimony would require a trial court to engage in an a ct of clairvoyance. The trial court would not only be required to anticipate the duration necessary for rehabilitation but

would also be requ

ired to anticipate

the future needs

of a spouse who, it has been determined, can be rehabilitated.

Crabtree v. Crabtree , 16 S.W.3d 356, 360 (Tenn. 2000).

In th is c ase, Ms. Oak ley w as aw arde d bo th a lim ony in futuro and rehabilitative alimony. Clearly, as stated in Crabtree , these awards are inconsistent with each other. As the trial court found that Ms. Oakley could be rehabilitated, the court erred when it awa rded Ms. Oakley ali mon y in futuro . However, it is clear from our review of the record that Ms. Oakley lacks any health insurance under the divorce decree. Ms. Oakley has suggested that the trial court’s award of al imo ny in futuro was most likely intended to provide such health insurance as Ms. Oakley testified during the trial that $375 was the cost “[f]or health insurance.” 2

Upon our review o

f the record, we

agree. An awa

rd for health insu

rance is specif

ically allowed under se

ction 36-5-101(f

)(1) of the Tenn

essee Code which

states: “[t]he cour

t may also direct a party to pay the pre miums for insurance insuring the health care costs of the other party.” Tenn. Code Ann. § 36-5-101(f)(1) (Supp. 2000). Taking this statute and the situation of the part ies int o acc oun t, w e her eby re vers e th e tr ial cou rt’ s aw ard o f al imo ny in futuro . Instead, we modify the tr

ial court’s awar

d of rehabilitativ

e alimony upw

ard by the a

mount of $375 per mo

nth to reflect the costs of Ms. Oakley’s health insurance. This portion of the reha bilitative alimony award will contin

ue until Ms. Oakley

becomes eligibl

e for Medicare

or until such time as

Ms. Oakley is able to obtain health insurance through her employ ment.

Mr. Oak ley h as al so a rgue d th at t he t ria l co urt erre d in awar din g Ms. Oak ley a lim ony in solido . However, “[b]oth in terms of logic and the purposes of alimony, we think it clear that ali mon y in solido is not inconsistent with a concurrent award of rehabilitative alimony.” Burlew v. Burlew , 40 S.W.3d 465, 472 (Tenn. 2001). In addition, “[p]rovided that the trial court considers the purposes of alimony . . . and the specific factors listed in the statute, Tenn. Code Ann. § 36- 5-101(d), it has wide discretion in determining the appropriate award.” Id. (citing Crabtree

, 16 S.W.3d at 360). Upon our review of the record, we cannot state that the trial court-4-

has abu sed its wid e di scr eti on i n th is m att er. A s a r esu lt, the tri al c our t’s awar d ofali mon y in solido in the amount of $65,000 to Ms. Oakley is hereby aff irmed.

Marital Property

Section 36-4-121(

b)(1) of the Ten

nessee Code state

s:
(A)"Marital pr

operty" me

ans all real and p

ersonal propert

y, both tang

ible and intangible, acquired by either or both spouses during the cour se of the marriage up to t

he date of the fin

al divorce hear

ing and owned by

either or both spouses as of the date of filing of a complaint for divorce, except in the case of fraudulent conv

eyance in anticipation of fi

ling, and includin

g any prop

erty to which a right was acquired up to the date of the final divorce hearing, and va lued as of a date as near as reasonably possible to the final divorce hearing date. In the case of a complaint for legal separation, the court may make a final disposition of the marital property either at the time of entering a order of legal separation or at the time of entering a final divorce decree, if any. If the marital property is divided as part of the ord

er of legal sep

aration, any

property a

cquired by

a spouse thereafter is deemed separate property of that spouse. All marital property shall be valued as of a da

te as near as poss

ible to the date of

entry of the

order finally div idi ng th e ma rit al p rop ert y. (B) "Marital property" includes income fr om, and any increase in value during the marriage of, property dete rmined to be separate property in accordance with subdivision (b)(2) if each party substantially contributed to its prese rvation and appreciation, and the value of vested and unvested pension, vested and unvested stock opt

ion rights, retir

ement or other fr

inge benefit ri

ghts relating t

o employment that accrued during the period of the marriag e. (C) "Marital pro

perty" inc ludes recovery

in personal injury

, workers' compensation, social security disability actions, and other similar ac tions for the following: wag

es lost during the

marriage, re

imbursement for me

dical bills inc urr ed an d pa id w ith mar ita l pr ope rty, and pro pert y dam age t o ma rit al p rop ert y. (D) As used in this subsection, "substantial contribution" may include, but not be limited to, the direct or indirect contribution of a spouse as homemaker, wage earner, parent or family f inancial manager, together with such other factors as the court having jurisdiction thereof may determine.

Tenn Code Ann. § 36-4-121(b)(1)(Supp. 2000), as amended by 2001 Tenn. Pub. Acts 274.3 Mr. Oakley inher ited these stocks

after his mother’s death.

-5- A. Award of Stocks and Sec urities

It is undisputed by the parties that the stocks and securities under dispute in this case we re Mr. Oak ley’ s se para te p rop ert y. 3 In addition, th e parties agre

e that neither pa

rty directl y contributed to the increase in value of these securities. The trial court agreed, specif ically finding that these stocks a

nd securities had

appreciated du

e to market forc

es “not from any

appreciable contribution by Ms. Oakley,” and were “separate property that [had] appreciated in value.” Even after making these findings however, the trial court still awarded Ms. Oakley twenty-five percent of the securities ’ appreciation. This award was in

error. The tria

l court found that t

hese securities were separate property in which Ms. Oakley had made no appreciable contribution. Thus, under section 36-4-121(b)(1) of the Tennessee Code, Ms. Oakley was not entitled to any portion of their appreciation. As a result, we hereby rever se the trial court’s award to Ms. Oakley of twenty-five percent of Mr. Oakley’s separate stocks and securities.

B. Real Properties in Memphis

Whether a spouse has made a substantial contribution to the preservation and appreciatio

n of the other spou

se's separate

property is

a question of fac

t. Substantial contributions are not limited to direct contributions but also include indirect contribu

tions such as "home

maker, wage e

arner, parent o

r family financial m anager." Tenn. Code Ann. § 36-4-121(b )(1)(C). A s pouse's contributions must be real and significant in order to be substantial. However, they need n

ot be monetarily

commensurate to th

e appreciation i

n the separate property's value, nor must they r elate directly to the separate property at issue. Brown v. Brown
, 913 S.W.2d 163, 167 (Tenn. Ct. App. 1994).

Wright-Miller v. Miller , 984 S.W.2d 936, 943-44 (Tenn. Ct. App. 1998).

Unlike its findings about Mr. Oakley ’s securities, the

trial court made n

o specific determination that Ms. Oakley did not contribute to the preservation and appreciation of Mr. Oakley’s real property

in Memphis. Through its ruling that the appreciation of these properties was marital prope

rty, the tria

l court, by ne

cessity, fo

und that Ms. Oakley

did contribute to th

eir preservation an

d appreciation. A

s the trial court’ s ruling that the a ppreciation is mar

ital property is a finding of fact, it may only be r eversed by this court if it is contrary to the pre ponderance of the evidence. Upon our review of the record, we cannot say that this finding is contrary to the preponderance of the evidence, and thus we affirm the trial court’s determination that the app reci ati on o f Mr . Oa kle y’s r eal pro pert y in M emp his was mar ita l pr ope rty.4 We also note that Mr. Oakley has questi oned Ms. Oakley’s abiliti es as a homemaker, finding such abili ties to be somewhat lacking. However, a substant

ial cont ribution can also be made while acting as a parent. Ms. Oakley helped to raise the couple ’s two chil dren during t

he marriag e. As Mr. Oakley a greed to joi

nt custody of

his minor children, with M s. Oakley having physical c ustody a nd final d ecision m aking au th orit y, wefeel tha

t he must not question Ms. Oakley’s pa

renting abi

liti es. Under Tennes see law, pa renting cont

ributions alone can be

considered a substantial c ontributio n to the pre servation and app reciation o f separate p roperty.

5 Itis clear

from the recor

d that Oakle

y Framers had some val ue at the t

ime Mr. Oakley rece

ived it, including inventory an d machin es.

-6- C. Oakley Framers

The trial court found that Oakley Framers was separ ate property of Mr. Oakley

. However, the trial court awarded Mr. Oakley only seventy-five percent of the total value of Oakley Framers, finding that Ms. Oakley had made a substantial contribution to its preservation and appreciation. Mr. Oakley argues that Ms. Oakley did not make such contributions either through working

at the business or a

s a homemaker and

parent. As such, h

e asks this court to reverse the trial court’s decision in this matter. As stated above, “[w]hether a spouse has made a substantial contri

bution to the prese

rvation and appr

eciation of the ot

her spouse's se

parate property is a question of fact.” Id. Thus, we may not reverse the t

rial court’s dec

ision on this matter unless it is contrary to the preponderance of the evidence. Upon our review, we cannot say that the trial court’s finding that Ms. Oakley made a substantial contribution to the preservation and appreciation of Oakley Fra mers is contrary to the preponderance of the evidence. 4

How ever , “an y increase in value during the marriage of, property dete rmined to be separate prope

rty . . . [can b

e considered mar

ital property

only] if eac

h party subst

antially contributed to its preservation and appreciation.” Tenn Code Ann. § 36-4-121(b)(1)(B) (Supp. 2000) (emphasis added). Thus, it is clear that Ms. Oakley is entitled only to the increase in value of Oakley F

ramers from the t

ime Mr. Oakley

received the bu

siness. The trial c

ourt was in error through its determination that the entire value of Oakley F ramers was marital property. Only the appreciation of Oakley Framers during the marriage was marital property that could be properly di

vided by the

court.
Upon reviewing the record before us, we cannot determine the initial value of Oakle y Fram ers at t he t ime it b ecam e Mr . Oa kle y’s p rop ert y. 5 As such, we are unable to determine the exact amount which Oakley Framers appreciated during the marriage. As a result, we hereby reverse the trial court’s finding that the entire value of Oakley Framers was marital property and remand to the trial court for determination of the amount of the appreciation during the marriage

. This appreciation is the only part of the total value of Oakley Framers that should be used in the div isi on o f ma rit al p rop ert y.-7- D. Florida Condom

inium

Upon our review o

f the record, we

note that the trial

court specifica

lly found tha

t Ms. Oakley’s Florida condominium was separate property. For the rea sons already discussed above, this court may not reverse the court’s factual findings unless they are contrary to the preponderance of the evidence. Upon our review of the record, we cannot state that the trial court’s determin

ation in this matter i

s contrary to the preponder

ance of the evid

ence. As a resul

t, we hereby

affirm the trial c

ourt’s finding th

at Ms. Oakley’s Florida condo minium is separate pro pert y.

Conclusion

In su mma ry, w e rev ers e th e awa rd o f al imo ny in futuro , modify the rehabilitative ali mon y, aff irm the ali mon y in solido , reverse the trial court’s decision to award Wife a portion of Husband’s separate property consisting of stocks and sec urities, affirm the decision that the increase in the r

eal property

is marital proper

ty, affirm t

he determination

that the Florida c

ondo is Wife’s separate property and affirm the decision that Wife made a substantial c ontribution to any increase in the value of the business. On remand, a determination must be made as to the value of the business at the time Husband acquired it. This cause is remanded to the trial court for a division of marital property in accordance with this opinion.

Costs on appeal ar

e taxed equally

to appellant, James S

pencer Oakley

, and appellee, Pa

tsy Hil l Oa kle y, an d th eir sur eti es, for whi ch ex ecut ion may i ssu e ifnece ssa ry.

___________________________________ DAVID R. FARMER, JUDGE