FILED

July 22, 1998

Cecil W. Crowson

Appellate Court Clerk

JEANIE DIANNE (WHITE) )

HANNAH, )

)

Plaintiff/Appellee, ) Appeal No.

) 01-A-01-9712-CV-00694

v. )

) Sumner Circuit

GARY R. HANNAH; CARL ED ) No. 17178-C

HANNAH and wife, DIANE )

CARROLL HANNAH, )

)

Defendants/Appellants. )

)

COURT OF APPEALS OF TENNESSEE

APPEAL FROM THE CIRCUIT COURT FOR SUMNER COUNTY

AT GALLATIN, TENNESSEE

THE HONORABLE THOMAS GOODALL, JUDGE

MICHAEL W. EDWARDS

177 East Main Street

Hendersonville, Tennessee 37075

ATTORNEY FOR PLAINTIFF/APPELLEE

ROBERT G. INGRUM

Phillips & Ingrum

117 East Main Street

Gallatin, Tennessee 37066

ATTORNEY FOR DEFENDANTS/APPELLANTS

REVERSED IN PART,

MODIFIED IN PART,

and REMANDED.

WILLIAM B. CAIN, JUDGE
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OPINION

Defendant/husband and his father and stepmother appeal a divorce

decree on issues of property rights, personal property values and amount of child

support.

Plaintiff, Jeanie Dianne (White) Hannah and defendant, Gary Ray

Hannah were married May 18, 1991. Two children were born to the marriage,

to-wit: Chelsea Alexandria Hannah born June 26, 1990, and Collin Ray Hannah

born January 24, 1994. Defendant had one child by a previous marriage and at

the time of the proceedings herein was paying $75.00 per week for support of

this child under proper court order.

Defendants Carl Ed Hannah and wife, Diane Carroll Hannah are the

father and stepmother of Gary Ray Hannah.

On August 6, 1992, Carl Ed Hannah and wife, Diane Carroll Hannah

purchased, by warranty deed, property located at 121 Mockingbird Hill Road in

Hendersonville, Tennessee. Simultaneously, they executed a promissory note

and deed of trust encumbering the property in the amount of $30,000.00 to First

American National Bank. A mobile home was located on the property and

included within the deed and the deed of trust. Monthly payments on the note

to the bank were $638.76 for a period of five years.

This property was purchased for use as a home by Jeanie Dianne

Hannah, Gary Ray Hannah and their children but title to the property was held

by Carl Ed Hannah and Diane Carroll Hannah subject to the deed of trust to First

American National Bank. Neither Gary Ray Hannah nor Jeanie Dianne Hannah

were in any way obligated on the debt to the bank. 

An oral agreement was made among all parties that Gary Ray Hannah,

Jeanie Dianne Hannah and their children would live in the mobile home, make

the monthly payments to First American National Bank, pay insurance and
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property taxes and otherwise generally maintain the property. They would pay

no rent and if Gary Ray Hannah and Jeanie Dianne Hannah made all payments

sufficient to discharge the mortgage indebtedness, Carl Ed Hannah and Diane

Carroll Hannah would then deed the property, in fee simple, to them.

First payment on the deed of trust note was due September 15, 1992

and a like payment due monthly thereafter, through and including final payment,

due August 15, 1997.

Gary and Jeanie Hannah moved into the property and made certain of

the payments to the bank until November 1994 when these parties separated for

the first time and simply stopped making the mortgage payments. By April 1995

with Gary and Jeanie Hannah having failed and refused to make payments to the

bank and the note being five payments overdue, Carl Ed Hannah and Diane

Carroll Hannah paid off the loan balance to the bank in the amount of

$16,120.07.

After the payoff of the bank by Carl Ed and Diane Hannah, Gary and

Jeanie Hannah reconciled and moved back into the Mockingbird Hill Road

property and lived rent free with neither of them recognizing any obligation to

pay anything to Carl Ed and Diane Hannah. Gary and Jeanie separated in 1997

and suit for divorce was filed by Jeanie Hannah on July 24, 1997.

No issue is made on appeal as to the action of the trial court in granting

the divorce to Jeanie Dianne Hannah nor to the action of the trial court vesting

custody of the two minor children in her.

The first issue on appeal involves the disposition of the property at 121

Mockingbird Hill Road.

In the final decree the trial court held in part:

(2) The Court finds the following marital estate:

(a) REAL ESTATE: The house and lot located at 121

Mockingbird Hill Road, Hendersonville, Sumner County,
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Tennessee, has a fair market value of Sixty-four Thousand

and 00/100 Dollars ($64,000.00). This property is titled in

the name of the HUSBAND's parents, CARL E. HANNAH

and wife, DIANE C. HANNAH, and the Court finds that an

agreement was made between the parties that the HUSBAND

and WIFE would make the mortgage payments and once the

house was paid off, it would be titled and deeded in their

names. Without the knowledge of the WIFE, the

HUSBAND's parents paid the house off in the amount of

Twenty-oneThousand and 00/100 Dollars ($21,000.00). The

Court finds that the net equity which constitutes the marital

estate is Forty-three Thousand and 00/100 Dollars

($43,000.00).

The Court finds that the best interests of all parties

involved in this case would be served in placing the property

located at 121 Mockingbird Hill Road, Hendersonville,

Sumner County, Tennessee, in the hands of Mahailiah

Hughes, Circuit Court Clerk, as special commissioner to sell

said property and make the division thereof based on this

Court's Final Decree.

Afterwards, as a part of the division of the marital estate, the trial court

granted $12,850.00 of the 121 Mockingbird Hill Road equity to the husband and

$30,150.00 thereof to the wife.

The evidence in the case strongly preponderates against the action of

the trial court. The final judgment does not state the basis for the trial court

holding and the evidence does not support either a resulting or constructive trust

as asserted on appeal by appellee. It is undisputed that the property at all times

belonged to Carl Ed Hannah and Diane Carroll Hannah. An oral agreement

between all parties provided bilateral obligations. Carl Ed and Diane Hannah

provided the means by which the home was purchased and assumed all

obligations to the bank. Gary and Jeanie Hannah agreed to make the mortgage

payments, together with paying the taxes and upkeep on the property, during the

five year term of the mortgage. Barely two years into the mortgage term Gary

and Jeanie Hannah repudiated their oral obligation by failing and refusing to

make the mortgage payments. Since they were not obligated to the bank on the

mortgage debt the entirety of this obligation fell back on Carl Ed and Diane

Hannah. Five months passed with no payments on the mortgage debt and no

indication by either Gary or Jeanie Hannah of any intention to make any further
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mortgage payments. Faced with this problem and being the sole obligors on the

note to the bank, Carl Ed and Diane Hannah paid off the balance of the note to

the bank. The trial court found that the payoff at the bank was made without

Jeanie Hannah's knowledge. This determination is of no consequence. Jeanie

well knew that both she and Gary Hannah had breached the contract with Carl

Ed and Diane Hannah by refusing to pay the mortgage installments after

November 1994. Under this analysis, the payments made by Gary and Jeanie

amount to mere rental payments,justly compensating Gary's parents for Gary and

Jeanie's use of the property.

After their reconciliation, following the payoff of the mortgage

indebtedness, Gary and Jeanie Hannah lived rent free on the property purchased

by Carl Ed and Diane Hannah. As such, Gary and Jeanie became no more than

gratuitous tenants of sufferance.

This charitable forbearance by Carl Ed and Diane Hannah is the

antithesis of the fraud, abuse of confidence, unconscionable conduct, artifice or

concealment necessary to justify a constructive trust. Rowlett v. Guthrie, 867

S.W.2d 732 (Tenn.Ct.App.1993). 

Since Gary and Jeanie Hannah abandoned and disavowed their

obligation to pay the mortgage payments as they became due and thus left their

benefactors to pay off the mortgage, the most they could hope for would be a

resulting trust pro tanto as to the amount of money they had actually paid.

[7] Payment of a part of the consideration, under such

circumstances that if the whole were paid a trust would

result, creates a trust pro tanto, if the amount paid be definite

or constitute an aliquot part of the whole consideration. But

a general contribution is not sufficient to raise a resulting

trust. 2 Lawrence on Eq.Jur. (1929 ed.) sec. 571; Pomeroy's

Eq.Jur. (5th ed.), sec. 1038, pp. 77-78; Perkins v. Cheairs, 61

Tenn. 194, 200-202; Haggard v. Benson, 3 Tenn.Ch.

(Cooper's), 263, 278; Botsford v. Burr, 1817, 2

Johns.Ch.,N.Y., 405, 410; Socol v. King, 36 Cal.2d 342, 223

P.2d 627; Annotation, 42 A.L.R. 52. 

[8] To set up a resulting trust by parol requires a
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greater degree of proof than a mere preponderance of the

evidence. The evidence must be clear and convincing.

Hoffner v. Hoffner, 32 Tenn.App. 98, 104, 221 S.W.2d 907;

Hunt v. Hunt, 169 Tenn. 1, 9, 80 S.W.2d 666; Walker v.

Walker, supra; see other Tennessee cases cited in

Annotation, 23 A.L.R. 1513-14.

. . .

. . . Referring to parol evidence to establish a resulting

trust, Pomeroy says:

 "It is settled by a complete unanimity of

decision that such evidence must be clear,

strong, unequivocal, unmistakable, and must

establish the fact of the payment by the alleged

beneficiary beyond a doubt. Where the

payment of a part only is claimed, the evidence

must show, in the same clear manner, the exact

portion of the whole price which was paid."

(Italics supplied.) Pomeroy's Eq.Jur. (5th ed.),

sec. 1040, pp. 82-84. 

Greene v. Greene, 38 Tenn. App. 238, 249-50, 272 S.W.2d 483, 488 (1954).

The proof in the case at bar does not establish any definite amount paid

by Gary and Jeanie Hannah, and considered as a whole, the evidence falls far

short of the clear, strong, unequivocal and unmistakable testimony necessary to

establish a resulting trust pro tanto.

Indeed, such seems to have been the conclusion of the trial court at the

end of the trial:

MR. INGRUM: Now does Your honor want to

hear any proof from Mr. and Mrs. Hannah concerning their

ownership rights and what they've paid, or have you already

decided --

THE COURT: No. They own the property.

The property at 121 Mockingbird Hill Road belongs in fee simple to

Carl Ed Hannah and wife, Diane Carroll Hannah. As such neither the property

nor the fair market rents paid for its use are to be considered as marital property.

The decision of the trial court holding otherwise is reversed.
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Appellant next takes issue with the amount of child support ordered

below. The court found that the earning capacity of the appellant was far in

excess of the actual income reported by him. The evidence does not

preponderate against this finding of fact. This court, however, does take issue

with the calculation method the trial court used. In ordering the support

obligation, the court below apparently considered a $2,280.96 net income for an

individual earning $3,000 gross. The court used this net figure in calculating the

support obligation of the appellant. Although the proof below showed that Gary

Ray Hannah was "self-employed," the trial judge apparently imputed the

earnings $3,000 wages as those of an employed individual. However, this court

finds that in calculating the appellant's support obligation, the trial court failed

to consider appellant's prior support obligation of $325 per month for the child

of a prior marriage per the Child Support Guidelines. Tenn. Comp. R. & Regs.

r. 1240-2-4-.03(1994). By subtracting that $325 from the monthly gross, we

arrive at the appropriate net income of $1,955.96. This figure corresponds more

closely with $627 per month child support, payable at $146.00 per week through

the Registry of the Circuit Court Clerk's Office, plus an additional 5%

commission for a total of $153.30 per week.

Appellant complains of the allocation and valuation of marital property

made by the trial court.

First of all, since this court reverses the action of the trial court

allocating the property at 121 Mockingbird Hill Road as marital property, there

is no division thereof to be made. The valuation of the 1978 Ski Supreme boat

was valued by both parties at $2,500.00 but the value in the final decree is

$5,000.00. The value of this item is set at $2,500.00 and same is awarded to

appellant. The value of the Kabota lawn mower is established by the testimony

to be $600.00 but is valued at $3,500.00 in the final decree. The value thereof

is $600.00 and same is awarded to appellant. The value of the GMC Jimmy is

not established by the record but in the decree is valued at $2,000.00. Regardless

of its value same is awarded to appellee. The 1972 Nova is valued by the

appellee between $4,500.00 and $5,500.00 and found by the trial court to have

a value of $5,500.00. We award the 1972 Nova, whatever its value, to Jeanie
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Hannah. The tools of the appellant are valued by the appellant at $1,000.00 and

by the appellee at $8,000.00 but found by the decree to have a $3,500.00 value.

The tools are valued at $3,500.00 and are awarded to the appellant.

All other property of any kind or character, regardless of value, is

awarded to appellee.

It is necessary to comment briefly on the procedure used in the trial

court bringing about the final decree. At the conclusion of the hearing the trial

judge instructed both counsel to submit their proposals separately to the court

without exchanging same. The result is that the trial court adopted the decree

submitted by counsel for the appellee, and the first time that counsel for the

appellant was made aware of the contents thereof, was when he received a copy

of the final decree. A motion to alter or amend was thereafter denied by the trial

court. In many respects the final decree is simply contrary to the evidence in the

case. This is a procedure which should not be encouraged.

The judgment of the trial court is reversed in part, modified in part, and

remanded. Costs on appeal are assessed equally against the parties.

_________________________________

WILLIAM B. CAIN, JUDGE

CONCUR:

__________________________________

HENRY F. TODD, PRESIDING JUDGE

__________________________________

WILLIAM C. KOCH, JR., JUDGE