Case Name: John Jefferson MARTIN v. Joyce Kathryn Moses MARTIN
Court: Court of Appeals of Virginia
Jurisdiction: Virginia
Decision Date: 1997-09-09
Citations: 25 Va. App. 551
Docket Number: Record No. 1772-96-3
Parties: John Jefferson MARTIN v. Joyce Kathryn Moses MARTIN.
Judges: 
Reporter: Virginia Court of Appeals Courts
Volume: 25
Pages: 551–564

Head Matter:
489 S.E.2d 727
John Jefferson MARTIN v. Joyce Kathryn Moses MARTIN.
Record No. 1772-96-3.
Court of Appeals of Virginia, Salem.
Sept. 9, 1997.
Rehearing En Banc Granted Oct. 14, 1997.
David A. Furrow, Rocky Mount (Law Offices of David A. Furrow, P.C., on briefs), for appellant.
Alton B. Prillaman, Roanoke, John Acree, Woodstock (Robin E. Dearing, Jolly, Place, Fralin & Prillaman, P.C., Roanoke, on brief), for appellee.
Present: MOON, C.J., and COLEMAN and WILLIS, JJ.

Opinion:
MOON, Chief Judge.
John Jefferson Martin ("husband") appeals the circuit court's determination of his separate property interest in his marital residence. He asserts that the trial court erred in failing to treat as separate property the increased value of the marital home attributable to his separate contribution to its purchase. We hold that the evidence supports the finding that wife's personal efforts were significant and resulted in a substantial increase in the value of the marital residence. Further, because husband's evidence did not prove, as a matter of law, that some portion of the increased value was not caused by contributions of marital property or wife's personal efforts, we hold that the trial court did not err in failing to classify as husband's separate property a proportionate share of the appreciated value of the marital residence.
Husband and Joyce Kathryn Moses Martin ("wife") were married on February 14, 1981. At the time of the parties' marriage, husband and his former wife were tenants in common in a home which was the subject of a partition sale. Wife testified that she had some real estate knowledge and "acumen" and that she determined that the house was going to sell too "cheaply." Wife stated that she told husband that they should purchase the house and then resell it at a later date at a substantial profit. They purchased the home for $60,100. Husband's separate property interest in the home was $26,-634.22. The parties obtained a joint loan of an additional $30,000 toward the purchase of the home. Husband testified that he paid $3,465.87 in "additional fees, lawyer's fees, taxes, and stuff like that." Husband stated that he had received the $3,465.87 from his former wife as part of their marital settlement.
On August 20, 1993, wife filed for divorce. The matter was referred to a commissioner in chancery, who found that husband was entitled to reimbursement of $26,634.22, the amount of his separate funds contributed to the purchase of the residence, but that the remainder was marital property which should be divided equally. The trial court overruled husband's objection to the commissioner's report and entered a final decree adopting the commissioner's findings.
Code § 20-107.3 controls the classification and division of a marital estate and specifically provides what is required in order to prove that property has been transmuted into marital property and which party has the initial burden of proving the necessary elements. In relevant part, Code § 20-107.3(A)(l) and (2) provide that:
1. Separate property is . that part of any property classified as separate pursuant to subdivision A3____ The increase in value of separate property during the marriage is separate property, unless marital property or the personal efforts of either party have contributed to such increases and then only to the extent of the increases in value attributable to such contributions. The personal efforts of either party must be significant and result in substantial appreciation of the separate property if any increase in value attributable thereto is to be considered marital property.
2. Marital property is . that part of any property classified as marital pursuant to subdivision A3____
(Emphasis added). Code § 20-107.3(A)(3) requires that:
3. The court shall classify property as part marital property and part separate property as follows:
a---- 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 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.
"Personal effort " of a party shall be deemed to be labor, effort, inventiveness, physical or intellectual skill, creativity, or managerial, promotional or marketing activity applied directly to the separate property of either party.
(Emphasis added). Reading Code § 20-107.3(A)(l) and (2) in conjunction with Code § 20-107.3(A)(3), we hold that in order to establish that the increase in the value of the marital residence was marital property, wife had to prove either that contributions of marital property or her personal efforts, or both, resulted in the increase. Further, to the extent that she relied on proving that the increased value was attributable either to her or husband's personal efforts, she had to prove that the personal efforts were "significant" and resulted in "substantial appreciation" of husband's separate property interest in the marital residence.
The question in this case is whether wife's contributed "personal effort" of "labor, effort, inventiveness, physical intellectual skill, creativity, or managerial, promotional or marketing activity applied directly to the separate property." Wife testified that her knowledge and real estate acumen led her to believe that the residence was worth substantially more than its potential purchase price.
Whether wife's personal efforts were significant was a matter for the trial court to determine, and such determination will not be reversed unless plainly wrong. Pommerenke v. Pommerenke, 7 Va.App. 241, 244, 372 S.E.2d 630, 631 (1988). Wife's testimony supports a finding that her real estate acumen and urging of her husband to invest in the residence was "personal effort" which, according to the wife, was significant and resulted in substantial appreciation of the husband's separate property. Once the evidence was sufficient to support such a finding, the burden shifted to husband to prove that factors other than wife's personal efforts and the contribution of marital funds increased the value of his investment. However, husband put on no evidence to contradict wife's evidence. Therefore, we cannot say that the trial court was plainly wrong in classifying as marital property the entire increase in the value of the husband's separate property at the time of purchase.
Wife testified that the house was bought because she recognized its potential value when husband was willing to pass on the opportunity to purchase it. Wife asserted that husband invested his $26,634.22 upon her advice that the house was worth $79,000 at the time they purchased the home for $60,100. Thus, wife contended that husband had an asset of $26,634.22 which he was about to receive in the form of cash from the sale of his former residence and she convinced him to "invest" it by purchasing the residence, which she believed was undervalued. Viewing the evidence in the light most favorable to wife, husband's asset of $26,634.22 was thus immediately increased by $8,375.82 to $35,010.04 as a result of wife's knowledge and "acumen."
Wife also testified that the increase in the value of the residence from time of purchase ($79,000) to $110,000 was attributable to her efforts in "fixing up" the residence and her investment of $5,000 of marital funds in "improvements." Wife stated that the she was actively involved in making the improvements, including carpeting, painting, and wallpapering the house. It was undisputed that at the time of the parties' divorce, the marital residence's value had increased to $110,-000 and that wife had made improvements to the home and spent marital funds in making improvements. Consequently, construing the evidence in the light most favorable to wife, we hold the evidence was sufficient to prove that husband's original investment of $26,634.22, which increased at the time of purchase to $35,010.04, was subsequently increased by $9,927.30 to $44,937.34 as a result of wife's personal efforts and the investment of marital funds.
Husband argues that wife's efforts were not significant and that there was no showing that they resulted in an increase in value. However, at trial, after wife testified that her efforts and investment of $5,000 in marital funds were the sole cause of the increase, the burden again shifted to husband to prove what part of the increase, if any, was not due to personal efforts of either of the parties or to use of marital funds. Husband adduced no such evidence. Therefore, we cannot say that the trial court was plainly wrong in deciding that the total increase in value of husband's separate property investment was marital property.
The circumstances here are unlike those of Rowe. v. Rowe, 24 Va.App. 123, 136, 480 S.E.2d 760, 766 (1997), where the owning spouse presented evidence proving that the increase in the value of his separate newspaper stock was largely due to the efforts of others or from passive factors. Here, husband presented no evidence which proved, as a matter of law, that the increase in value of husband's separate interest in the home was not due to contributions of marital property or wife's personal efforts. Here, unlike in Rowe, wife testified that her efforts were responsible for the increase in value. In Rowe, the wife merely testified that she did some work in the house but put no dollar value on the work nor did she testify as to what effect the work had on the increase in the house's value. See 24 Va.App. at 136, 480 S.E.2d at 766.
Husband also argues that the trial court erred in failing to classify as his separate property interest the sum of $3,465.78 which he asserts he contributed to the purchase of the home when he and wife purchased it. Husband raised no objection at trial concerning the trial court's failure to classify his $3,465.78 as his separate property. Rule 5A:18 bars our consideration of any ruling of the trial court unless the objection was stated together with the grounds therefor at the time of the ruling.
Accordingly, we affirm.
Affirmed.
. We read Code § 20-107.3(A)(l) and 20-107.3(A)(3) as requiring that personal efforts must be significant and result in substantial increase in value. However, we do not read these sections as requiring that wife prove that "contributions of marital property" were "significant" or resulted in "substantial appreciation," in order for those contributions to be considered in determining what portion of the increased value of the marital residence was properly classified as marital. Both code sections specifically address "personal efforts" and the "significant" and "substantial" requirements, but no similar provision is made for contributions of marital property.
. $26,634.22/$60,100 multiplied by $18,900 ($79,000 minus $60,100).
. $26,634.22/$110,000 multiplied by $41,000 ($110,000 minus $79,-000).