THE STATE OF SOUTH C AROLINA In The Supreme Court

Josie M. Bostick, Respondent,

v.

Earl A. Bostick Sr., Petitioner.

Appellate Case No. 2022

- 000894

ON WRIT OF CERTIORARI TO THE COURT OF APPEALS

Appeal f rom Beaufort County

Michèle Patrão Forsythe, Family Court Judge

Opinion No. 28226

Heard May 21, 2024

– Filed July 31, 2024

REVERSED

J. Michael Taylor, of Taylor/Potterfield

, of Columbia ; and H. Grady Brown III, of Brown & Norton, LLC, and Bridget Hillebrand Norton, both of Beaufor t, all for

Petitioner

.

John Ryd Bush Long, of John R. B. Long, PC , of Augusta

, GA

, for Respondent.

JUSTICE KITTREDGE : In this domestic relations appeal

, we examine whether the goodwill in a particular dental practice constitutes personal or enterprisegoodwill. We reverse the court of appeal s' decision and reinstate the family court's decision, for th e goodwill in the dental practice in this case bears all the hallmarks of personal goodwill (nonmarital property), and no evidence was presented to the family court upon which it could have concluded the goodwill was enterprise goodwill (mar i tal property)

.

I.

Dr. Earl Bostick Sr. (Husband) and Josie Bostick (Wife) married in 197 0

. Soon

after

, Husband became a dentist and opened his own practice. Over the course of his career, Husband developed two prosperous dental practices in South Carolina : Sea Island Dentistry in Beaufort and Earl Bostick Sr., D.M.D. and Associates, P.A. in Ridgeland

.

In 2009, due to various health concerns, Husband downsized his workload by selling the Sea Island practice to another dentist, the proceeds from which he received in installment payments. Husban d maintained the Ridgeland practice at that point and

continued to work

.

After about forty-fiv e years of marriage , the parties separated

, and Wife filed for

divorce in 2017

. P rior t o trial, Husband sold the Ridgeland practice for a total sales price of $569,000

. According to the sales contract, the lion's share of the total sales price

— $424,140

— was paid in exchange for the goodwill in the practice and a restrictive covenant not to compete, 1 with the remaining portion of the s ales price securing the practice's hard assets.

At trial, th e parties stipulated to a n equal division of the marital estate. They further stipulated that the value of the Ridgeland practice was $569,000

— the total sales price represented in the sales contr act

. 2 However, Husband and Wife contested

1 Specifically, the restrictive covenant precluded Husband's ability to "[s]olicit

business

. . . or attempt to convert to other providers of the same or similar services as provided by Buyer, any customer, client or account Buyer or with which Bostick has had any contact during the term of ownership of Seller." Husband also agreed he would not engage in or be financially interested in any business or group (competitor or customer) s imilar to or in competition with the buyer within a fifteen

mile radius.

2 Although that stipulation did not contain a breakdown of the total sales price, Wifewhether the goodwill in the Ridgeland practice was personal goodwill (nonmarital property) or enter prise goodwill (marital property) , and, therefore, whether the value

of that goodwill w as subject to equitable division. 3

Following trial, the family court granted Wife a divorce on the ground of one year's continuous separation. Relevant to this appeal, the family court concluded the goodwill component of the total sales price of the Ridgeland practice was a nonmarital asset , finding it was paid in exchange for personal goodwill attributable to Husband's professional status pursuant to our decision in Moore v. Moore , 414 S.C. 490, 779 S.E.2d 533 (2015).

Wife appealed to the court of appeals , which reversed the family court's goodwill

determination

. Bostick v. Bostick , 436 S.C. 434, 872 S.E.2d 859 (Ct. App. 2022)

. Subsequently, w e granted Husband a writ of certiorari to review the court of appeals'

decision.

II

.

In appeals from the family court, this Court reviews factual and legal issues de novo.

Simmons v. Simmons , 392 S.C. 412, 414, 709 S.E.2d 666, 667 (2011) (citations omitted). Thus, we have jurisdiction to find facts in accordance with our own view of the preponderance of the evidence. Moore , 414 S. C. at 497, 779 S.E.2d at 536. This broad scope of review, however, does not require us to disregard the findings of the family court, which is in a superior position to make credibility

determinations. Lewis v. Lewis , 392 S.C. 381, 385, 709 S.E.2d 650, 6 51

– 52 (2011).

I II

.

A.

In divorce proceedings

, the family court must identify, value, and apportion the

marital estate

. Gardner v. Gardner , 368 S.C. 134, 136, 628 S.E.2d 37, 38 (2006) (citation omitted). Once the family court identifies goodwill in a spouse's business

did not offer any evidence to dispute the value of the goodwill in the Ridgeland practice being the amount reflected in the sales contract.

3 The parties agreed to treat the remaining proceeds from the Sea Island sale as marital property.as an asset, t he question then becomes whether and to what extent such goodwill should be considered a marital asset subject to equitable division

. Moore , 414 S.C.

at 509, 779 S.E.2d at 543

. Answering that question requires a fact

- based

classification of the goodwill as personal or enterprise in nature , for enterprise goodwill is a marital asset subject to equitable division

, while personal goodwill is

a nonmarital asset excluded from equitable division. Id. at 512 , 779 S.E.2d at 544.

Generally, enterprise goodwill is that which exists independently of one's personal

efforts and will survive one's involvement with the business. Id. at 509

– 10

, 799

S.E.2d at 543 ( "[E]nterprise goodwill attaches to a business entity and is associated separately from the reputation of the owners

. . . . " (citation omitted)).

In contrast, personal goodwill is associated with individuals: it is that part of increased earning capacity that results from the reputation, knowledge and skills of individual people. Id. at 510, 799 S.E.2d at 543 (citation omitted)

. For that reason

, "the goodwill of a service business, such as a professional practice [such as dentistry] , consists largely of personal goodwill." Id. (emphasis added) (citation omitted); see Donahue v. Donahue , 299 S.C. 353, 360, 384 S.E.2d 741, 74 5 (1989) (reversing family court's division of the goodwill of husband's dental practice because "[t]he very nature of a professional practice is that it is totally dependent upon the professional" (citation omitted) ) ; Dickert v. Dickert , 387 S.C. 1, 7, 691 S.E.2d 448, 451 (2010) (rejecting a claim that the goodwill in the dental practice was enterprise goodwill and

, thus

, finding the goodwill was properly excluded from the marital estate). The personal characteristics of the owner are also important to

asc ertaining personal goodwill, including the owner's personal reputation, community visibility, age and health, and work habits, as well as the owner's education, experience in the industry, judgment, ability, and special skills or talents.

Moore , 414 S.C. at 51 4 , 799 S.E.2d at 54 5 (citation omitted).

B.

As an initial matter

, we emphasize that Wife did not present any evidence to the family court upon which it could have possibly determined the goodwill component of Husband's dental practice was enterprise goodwill

. 4 See i d. at 513, 779 S.E.2d at

4 To be clear, we do not fault Wife's attorney for the failure to present evidence in this regard, for it appears he was retained less than a week b efore trial and was merely the last in a string of family court attorneys retained by Wife in this matter

.545 ("The spouse claiming that goodwill should be included in the marital estate bears the burden of proving the goodwill at issue is enterprise goodwill and, thus, is properly considered marital property." (citati ons omitted))

. In th e absence of contrary evidence , we are left solely with the evidence presented by Husband regarding the nature of the goodwill in the Ridgeland practice

.

In particular, Husband submitted evidence demonstrating he established and solely

owned the Ridgeland practice

— which bore only his name

— for decades prior to its

sale . After opening his practice

, Husband devoted considerable time to immersing himself in the community with an aim at promoting his business and shaping hi s reputation as a dentist

. 5 For example, Husband joined the Rotary Club and the

Chamber of Comm erce , attending a number of events for both organizations

. Moreover , Husband created marketing materials

— which included his name and photo graph

— and a dvertised hi s practice in church brochures, on the radio, and on

television. H e also print ed promotional booklets and calendars to disseminate in the community. Finally, Husband nurtured his established patient

- base by periodically contacting his patien ts individually by , for example

, sending Christmas cards. These efforts, among many others, were successful in building and maintaining a thriving dental practice with loyal patients. All of this evidence compellingly points to the goodwill being personal to Husband

.

Of additional significance is the presence of Husband's covenant not to compete, which the purchaser required in the sale of the Ridgeland practice. See id. at 51 5

, 779 S.E.2d at 546 ("While a covenant not to compete may be present in any transaction, the market

- driven necessity for a covenant is manifest where personal goodwill is involved ." (emphasis added)). Husband's impending retirement does not

diminish the i mportance of the covenant not to compete in the goodwill analysis, or render it a "hollow promise," as erroneously found by the court of appeals. The dental practice's success and reputation existed solely because of Husband's professional skill and broad , community

- focused outreach. That being the case, any prudent purchaser of the business would insist on a covenant not to compete

— Husband's age and health notwithstanding

— to close the door on any possibility of

5 G iven the nature of dentistry —a service

- based profession

— the Ridgeland dental practice's continued patronage largely depended on the Husband's personal relationships with his patients. See Donahue , 299 S.C. at 360, 384 S.E.2d at 74 5 ("[T]he very nature of a professional practice is that it is totally dependent upon the professional."); Dickert , 387 S.C. at 7, 691 S.E.2d at 451 (same).Husband's association with or endorsement of a competitor.

These undisputed facts clearly establish the goodwill in the Ridgeland practice was personal : Husband's name, reputation, and visibility in the community were critical to the success of the Ridgeland practice prior to its sale , the continui ty of which the purchaser ensured by requiring Husband to enter a restrictive covenant not to

compete. 6 The facts of this case fit neatly

— and unequivocally

— within the personal goodwill template set forth more extensively in Moore . Accordingly, we hold th e family court properly excluded the value of the goodwill from the sale of the Ridgeland practice from the mar i tal estate.

C.

Significantly

, like the family court, the c ourt of appeals found the goodwill

associated with the Ridgeland practice was personal in nature , finding "i t closely

follows the factors set out in Moore ." However, the court of appeals reached a

different result

, cast ing Moore aside on the incorrect basis that it was limited to "ongoing" businesses. W hile the facts of Moore involved a business in which one spouse would remain as the sole owner of the business following the parties ' divor ce , nowhere in our decision did we suggest the classification of goodwill hinged upon

w hether one of the spouses would remain in the busines s. We reject t he notion that personal goodwill is present only when one spouse remains in the business. We

view the Moore situation, involving an " ongoing " business

, as an outlier

, for the typical situation is that which was presented here : one or both of the spouse s' business is sold to a third party

, and neither spouse remains in the business following their divorce. This reality reaffirms the importance of a covenant n ot to compete in determining the nature of the goodwill

. 7

6 Once again, Wife presented no evidence to establish the goodwill associated with the Ridgeland practice was enterprise go odwill, nor did she r efute Husband's evidence demonstrating the goodwill was personal. On the contrary, Wife admitted that patients were drawn to the practice because of Husband's efforts in the community. She further testified that she mark et ed Husband's dental skills personally , telling potential patients he was a "painless dentist."

7 As a final note , w e further reject the suggestion that the parties' treatment of proceeds from the Sea Island sale

— occurring roughly nine years before the parties '

divorce

— has any impact on th e analysis of the goodwill in the Ridgeland practiceIV.

In conclusion

, Wife failed to meet her burden of proving the goodwill associated

with the Ridgeland practice constituted marital property

, leaving only the

uncontradicted evidence establishing that that goodwill at issue here was personal in

nature

. Therefore, we hold the va lue of the personal goodwill in the dental practice was properly excluded from the equitable division of the marital estate. For those

reasons , we reverse the court of appeals' decision and reinstate the judgment of the family court

. 8

REVERSED.

BEA TTY, C.J., FEW, JAMES

, JJ., and Acting Justice Jan Benature Bromell
Holmes, concur.

or otherwise forecloses Husband's ability to argue that goodwill is personal, nonmarital property. As then

- Judge Hill no ted in dissent, "T he parties may have had

many reaso ns to treat the sales differently."

8 Our decision moots the anticipated remand from the court of appeals on the alimony and attorney's fees issues , which the court ordered based upon the change in the equitable distribution flowing from its erroneous decision regarding the goodwill in Husband's dental practice.