COURT OF APPEALS OF VIRGINIA 

Present: Chief Judge Moon, Judges Willis and Fitzpatrick 

Argued at Alexandria, Virginia 

CHARLES STUART DeHAVEN, JR. 

 MEMORANDUM OPINION* BY 

v. Record No. 0997-96-4 JUDGE JOHANNA L. FITZPATRICK 

 APRIL 8, 1997 

PAMELA BUSH DeHAVEN 

FROM THE CIRCUIT COURT OF FREDERICK COUNTY 

James L. Berry, Judge 

 Jeffery R. Patton (Louthan & Patton, P.C., on 

brief), for appellant. 

 Stephen G. Butler (Kuykendall, Johnston, 

McKee & Butler, P.L.C., on brief), for 

appellee. 

 On appeal from a final decree granting the parties a divorce 

and distributing their property, Charles Stuart DeHaven, Jr. 

argues that the trial court erred in: (1) its classification of 

the value of the marital residence; (2) its classification of 200 

shares of corporate stock; (3) its determination that the 

increase in the corporate stock value was attributable to the 

efforts of the parties, and (4) its determination that the 

increase in the corporate stock value was not attributable, in 

part, to the efforts of other persons. For the reasons that 

follow, we affirm in part and reverse in part. 

I. BACKGROUND

 Charles Stuart DeHaven, Jr. (husband) and Pamela Bush 

 

 *Pursuant to Code § 17-116.010 this opinion is not 

designated for publication. 
 2 

DeHaven (wife) were married in 1976, and two children were born 

of the marriage. In 1978, the parties constructed a family 

residence on land belonging to Charles Stuart DeHaven, Sr. 

(Charles Sr.), husband's father. Husband received funds from his 

father and labor from his father's plant nursery business when 

constructing the residence. In 1979 and 1980, Charles Sr. and 

his wife, Jane DeHaven, deeded the property ("land with 

improvements thereon") by deeds of gift to both husband and wife. 

 Charles Sr. was the sole proprietor of the nursery from 1966 

to 1986. In 1986, the business was incorporated, and the 

corporation leased land from Charles Sr. on which it constructed 

approximately $171,000 worth of improvements. The improvements 

became Charles Sr.'s property pursuant to a one-year lease. To 

service its operation, the corporation used water from a well 

situated on land belonging to husband and wife. 

 Wife worked for the nursery business from 1979 and was a 

director of the corporation from 1986 until 1994, when she was 

"removed." Wife was paid a small salary throughout her 

employment with the corporation. Husband worked for the business 

from 1976 throughout the parties' married life. At the time of 

incorporation in 1986, husband owned twenty-five percent of the 

business. By 1993, husband owned ninety-five percent of the 

corporation, as a result of gifts of stock made to him by his 

parents. Additionally, during this time period, the corporation 

paid husband a substantial salary. 
 3 

 On March 29, 1996, the trial court entered a final decree of 

divorce. The final decree incorporated the court's letter 

opinion dated December 29, 1995. The trial court's findings 

included the following: 

 The Court determines the first 200 

shares issued in 1986 to be marital property 

. . . . It is the opinion of the Court from 

the evidence that [the increase in value of 

the shares of stock received by the 

defendant], excluding inflation, is due to 

the personal efforts of the parties. 

 It is the further opinion of the Court 

that the residence, built in 1978, and gifted 

to both parties in October of 1979 and 

February 1980 is entirely marital property. 

 Additionally, the court classified as marital property a 

life insurance policy valued at $7,694.74, husband's IRA valued 

at $23,933.58, and wife's IRA valued at $17,917.36. The court 

found that husband possessed separate property of one hundred 

acres of real estate valued at $100,000, and his separate share 

of DeHaven Nursery, Inc. valued at $184,898.20. Finally, the 

court found that the "credit line debt of $39,555.78 [was] 

entirely within the control of the [husband]" and attributed this 

debt solely to husband. The court stated its consideration of 

the statutory factors as follows: 

 Considering the factors set out in 

§ 20-107.3 the Court finds Factors 3, 4, 5, 

6, 7, 8, and 9 to be either non-determinative 

or not applicable. Factor 1, strongly in 

favor of the complainant, Factor 2, slightly 

in favor of the defendant and Factor 5 in 

favor of the complainant. In addition, the 

Court has considered under Factor 10 that 

defendant holds net separate property 

totaling $245,343 and that the corporation 
 4 

has constructed $171,000 worth of 

improvements on the defendant's parents' 

property. 
 5 

II. THE MARITAL RESIDENCE

 Husband's first assignment of error is that the marital 

residence should have been classified as part separate and part 

marital property because it was "retraceable by a preponderance 

of the evidence." He contends that his "contributions of 

separate property commingled with marital property" to become 

"newly acquired property." Thus, husband argues, because the 

trial court erred in the classification of the marital residence, 

it therefore erred in the valuation and distribution of the 

marital residence. 

 "Code § 20-107.3(A) gives the court the authority, '[u]pon 

decreeing the dissolution of a marriage,' to value and apportion 

marital property and marital debts. The distribution 

contemplated by the General Assembly is predicated on the 

philosophy that marriage represents an economic partnership 

requiring that, upon dissolution, each partner should receive a 

fair proportion of the property . . . ." Floyd v. Floyd, 17 Va. 

App. 222, 226, 436 S.E.2d 457, 459 (1993) (quoting Roane v. 

Roane, 12 Va. App. 989, 994, 407 S.E.2d 698, 701 (1991)). Under 

Code § 20-107.3, all property acquired during the marriage and 

before the last separation of the parties is presumed to be 

marital property in the absence of satisfactory evidence that it 

is separate property. See Stainback v. Stainback, 11 Va. App. 

13, 17, 396 S.E.2d 686, 689 (1990). Property that is titled in 

the names of both husband and wife, as well as all other property 
 6 

acquired by either of them during the marriage which is not 

separate property is marital property. See Dietz v. Dietz, 17 

Va. App. 203, 208, 436 S.E.2d 463, 467 (1993). 

 "Generally, the character of property at the date of 

acquisition governs its classification pursuant to Code 

§ 20-107.3." Stratton v. Stratton, 16 Va. App. 878, 881, 433 

S.E.2d 920, 922 (1993). "Although property is initially 

classified as of the date of acquisition, once acquired, its 

character may change." McDavid v. McDavid, 19 Va. App. 406, 410, 

451 S.E.2d 713, 716 (1994). The party claiming that property 

should be classified as separate has the burden to produce 

satisfactory evidence to rebut the presumption that the property 

acquired during the marriage is marital. See Stratton, 16 Va. 

App. at 882, 433 S.E.2d at 922. 

 The trial court specifically found that, "the residence, 

built in 1978, and gifted to both parties in October of 1979 and 

February 1980 is entirely marital property." We agree. It is 

undisputed that the parties built their residence in 1978 upon 

land owned by husband's parents. Husband and his father 

testified that the property at issue was gifted to both husband 

and wife in 1979 and 1980, and the deeds of gifts clearly reflect 

the two transactions: 

 THIS DEED OF GIFT, made and dated this 10th 

day of October, 1979, by and between CHARLES 

STUART DeHAVEN and JANE METZ DeHAVEN, . . . 

and CHARLES S. DeHAVEN, JR., and PAMELA BUSH 

DeHAVEN . . . . [T]he Grantors make this Deed 

of Gift and hereby grant and convey, . . . 

unto the Grantees in fee simple, jointly, as 
 7 

tenants by the entireties with common law 

right of survivorship, an undivided one-half 

interest in the . . . described real estate 

 . . . [a]ll of that lot or parcel of land 

with improvements thereon . . . . The 

Grantors covenant that . . . the property 

. . . is free from all liens and encumbrances 

. . . .1

Although husband testified that he contributed funds he had 

accumulated prior to his marriage to the costs of building the 

marital residence, the trial court determined that this testimony 

did not sufficiently rebut the presumption that, upon 

acquisition, the marital residence and land was, in fact, marital 

property. 

 "Property which is initially separate may become marital 

property either by express agreement, or by the manner in which 

it is maintained." McDavid, 19 Va. App. at 410-11, 451 S.E.2d at 

716 (citations omitted). "Great consideration should be given to 

the actions, or non-action, of the parties with regard to 

exercising control over the property in question." Stainback, 11 

Va. App. at 21, 396 S.E.2d at 691. The mere fact that husband 

maintained a separate bank account for the funds to be used in 

the home's initial construction does not in and of itself 

transmute the marital property into husband's separate property. 

 Rather, despite husband's contentions, the evidence demonstrated 

that the home and the land, once deeded to husband and wife, 

 

 1The deed of gift dated February 4, 1980 contains the same 

language. 
 8 

remained marital. Neither party treated it otherwise.2

 At the 

time of conveyance, or any time thereafter, husband could have 

documented his interests to reflect his belief of a separate 

ownership interest. Neither he nor his parents did so. At no 

time during the marriage did either party indicate in any way 

that husband possessed a separate interest in the home or that he 

possessed a greater share in the home's value due to his 

contributions. 

 "'[T]he finding of the judge, upon the credibility of the 

witnesses and the weight to be given their evidence, stands on 

the same footing as the verdict of a jury, and unless that 

finding is plainly wrong, or without evidence to support it, it 

cannot be disturbed.'" Yates v. Commonwealth, 4 Va. App. 140, 

143, 355 S.E.2d 14, 16 (1987) (quoting Lane v. Commonwealth, 184 

Va. 603, 611, 35 S.E.2d 749, 753 (1945)). "In this case, the 

chancellor was confronted with conflicting testimony from 

 

 2Compare McDavid, a case in which we held that where the 

wife executed a deed of gift transferring her interest in the 

marital property to husband, the marital property was transmuted 

to separate property. In McDavid, we upheld the chancellor's 

determination that property, marital when acquired by the 

parties, became separate during the marriage. The husband and 

wife executed a deed of gift transferring the wife's interest to 

husband immediately after closing. The deed provided that the 

husband would hold the property "'in his own right as his 

separate and equitable estate as if he were an unmarried man 

 . . . free from the control and marital rights of his present 

 . . . spouse . . . .'" Id. at 411, 451 S.E.2d at 717. In the 

instant case, no such evidence supports the husband's contention 

that the marital residence and land attained or retained the 

character of separate property. 
 9 

interested witnesses on each side of the case, and it was his 

province alone, as the finder of fact, to assess the credibility 

of the witnesses and the probative value to be given their 

testimony. We treat the factual determinations of a chancellor 

based on ore tenus evidence in the same manner as factual 

determinations made by a jury; we reverse them only if they are 

plainly wrong or without evidence to support them." Richardson 

v. Richardson, 242 Va. 242, 246, 409 S.E.2d 148, 151 (1991) 

(citations omitted). See, e.g., Rowe v. Rowe, Record Nos. 

0843-96-2, 0845-96-2 (Va. Ct. App. February 4, 1997) (where we 

held the trial court erred by not classifying the marital 

residence, purchased with $82,000 of husband's separate funds, as 

completely marital property). We held that the cumulative 

evidence demonstrated that a gift was intended: (1) the parties 

purchased the home to accommodate their growing family; (2) 

husband placed no reservations on the transfers of title 

permitting him to reclaim the property upon divorce or any other 

circumstance; and (3) the house was conveyed by joint title. 

 Viewing the evidence and all reasonable inferences in the 

light most favorable to the prevailing party, the wife, and 

attributing great weight to the trial court's findings, see

Pommerenke v. Pommerenke, 7 Va. App. 241, 244, 372 S.E.2d 630, 

631 (1988), we conclude that the property was marital in 

character when acquired by deed of gift from husband's parents. 

The evidence proved that the property was a gift to both parties 
 10 

at the time it was deeded to the parties. The trial court was 

entitled to attribute greater weight to wife's testimony than to 

husband's, and credible evidence supports the trial court's 

determination. Accordingly, we hold that husband failed to rebut 

the presumption that the parties' marital residence was entirely 

marital property. 

III. 200 CORPORATE STOCK SHARES

 Husband next argues that the trial court should have 

classified the initial 200 shares of corporate stock as the 

separate property of the husband. To support this argument, he 

asserts the evidence confirmed that all the shares, including the 

initial 200 shares, of corporate stock were gifted solely to him 

from his parents, and that he retained these shares in his name 

throughout the parties marriage. We agree. 

 The statutory definition of separate property includes "all 

property acquired during the marriage by . . . gift from a source 

other than the other party. . . ." Code § 20-107.3(A)(1). The 

party claiming that property acquired during the marriage is a 

gift has the burden of proving it. Stainback, 11 Va. App. at 18, 

396 S.E.2d at 689-90. "In the case of a gift to one of the 

spouses, if there is credible evidence presented to show that the 

property was intended by the donor to be the separate property of 

one of the spouses, the presumption is overcome, and the burden 

shifts to the party seeking to have the property classified as 

marital to show a contrary intent on the part of the donor." Id.
 11 

at 17-18, 396 S.E.2d at 689. "[I]f the donee presents sufficient 

evidence to rebut the statutory presumption of marital property, 

and the other party presents no evidence to the contrary, . . . 

the presumption is rebutted." Huger v. Huger, 16 Va. App. 785, 

788, 433 S.E.2d 255, 257 (1993) (citing Stainback, 11 Va. App. 

13, 396 S.E.2d 686 (1990)). Thus, if the wife presents no 

evidence contrary to the husband's that the shares from his 

parents' gifts were intended to be separate property, the 

presumption that the shares were marital property is rebutted. 

See id. 

 The evidence established that husband owned 950 outstanding 

shares of DeHaven Nursery, Inc. at the time of the dissolution of 

the parties' marriage, and that these shares had been gifted to 

husband from his parents during the period of July 1, 1986 

through April 1, 1994. The testimony confirmed that husband's 

parents gave him 200 shares of the original issue of stock, and 

that each year thereafter, husband's parents gave husband 100 

shares annually as birthday gifts. Moreover, it is undisputed 

that the initial 200 shares were issued in husband's name. Wife 

presented no evidence to challenge husband's assertion that these 

shares were meant to be other than a gift solely to the husband. 

 Additionally, "'when we are required to review on appeal an 

issue arising under [Code § 20-107.3][, w]e must be able to 

determine from the record that the trial court has given 

substantive consideration to the evidence as it relates to the 
 12 

provisions of this Code section.'" Donnell v. Donnell, 20 Va. 

App. 37, 42, 455 S.E.2d 256, 258 (1995) (quoting Trivett v. 

Trivett, 7 Va. App. 148, 153, 371 S.E.2d 560, 563 (1988)). In 

the case at bar, the trial court gave no explanation of how it 

arrived at its disposition of the 200 shares, and no evidence 

supports the court's finding that these 200 shares were marital 

property. Rather, the evidence presented at trial confirmed the 

gifting by husband's parents of all shares of corporate stock 

solely to the husband, including the initial 200 shares as his 

separate property. Accordingly, we hold that the trial court 

erred in classifying these 200 shares of stock as marital 

property. 

 IV. INCREASE IN VALUE OF SHARE OF CORPORATE STOCK

 Lastly, husband argues that the trial court erred in 

determining that the increase in the stock value was attributable 

to the efforts of the parties and was not attributable in part to 

efforts of other persons. Code § 20-107.3(A)(3)(a) provides, in 

pertinent part, as follows: 

 In the case of the increase in value of 

separate property during the marriage, such 

increase in value shall be marital property 

only to the extent that marital property or 

the personal efforts of either party have 

contributed to such increases, provided that 

any such personal efforts must be significant 

and result in substantial appreciation of the 

separate property. 

 For purposes of this subdivision, the 

nonowning spouse shall bear the burden of 

proving that (i) contributions of marital 

property or personal effort were made and 

(ii) the separate property increased in 
 13 

value. Once this burden of proof is met, the 

owning spouse shall bear the burden of 

proving that the increase in value or some 

portion thereof was not caused by 

contributions of marital property or personal 

effort. 

Thus, "[i]f husband prove[s] that passive factors . . . account[] 

for a portion of the increase in the value of his stock, such 

increase cannot be properly classified as marital property. 

Similarly, . . . where third parties contribute to the increase 

in value of separate property, the marital portion is to be 

reduced proportionately." Rowe v. Rowe, Record Nos. 0843-96-2, 

0845-96-2, slip op. at 3 (Va. Ct. App. February 4, 1997) (citing 

Decker v. Decker, 17 Va. App. 12, 435 S.E.2d 407 (1993)). "The 

increase classifiable as marital should reflect only that 

attributable to [the parties'] personal efforts and not those of 

[others] or passive factors. . . ." Id., slip op. at 4. 

 At trial, husband's expert stated that a number of factors 

accounted for the increase in valuation, including market factors 

such as inflation. Wife testified regarding her role in the 

family business, but husband and his parents presented differing 

views of wife's efforts and contributions. The trial court found 

"from the evidence that such increase in value, excluding 

inflation, is due to the personal efforts of the parties." 

(Emphasis added). The evidence supports the trial court's 

conclusion that other than inflation, the efforts of both parties 

increased the value of the stock. Husband failed to establish or 

otherwise quantify efforts made by third parties towards the 
 14 

increase in the stock value. 

 Thus, based upon the record, we cannot say that the trial 

court was plainly wrong in determining that the parties' joint 

efforts enhanced the value of the stock. For the reasons stated 

above, we reverse the trial court's classification of the initial 
 15 

200 shares of stock as marital, and affirm the trial court's 

determinations on the remaining issues. 

 Affirmed in part

and reversed in part.