Opinion ID: 2151353
Heading Depth: 1
Heading Rank: 2

Heading: prior divorce proceedings and property settlement agreement

Text: Andersen filed for divorce in June 1992. A temporary restraining order was issued precluding any transfers from the corporation outside of the ordinary course of business. Woodward then began to claim that Andersen was wrongfully withdrawing money from the corporation. At a deposition taken in November, Woodward stated that he was investigating amounts Andersen had received from the corporation and indicated that there were payments made outside of the ordinary course of business. In his deposition, Woodward also stated that he was concerned about where money from the corporation was going and that he wanted an accounting. The record contains evidence indicating that money withdrawn by Andersen in 1992 was used to finance purchases for Woodward and to pay to him $30,000 per month under a temporary support order in the divorce proceedings. The record contains letters exchanged between Woodward's and Andersen's attorneys during the divorce proceedings. These letters indicate that there was considerable disagreement over the amount of information that was provided through discovery regarding the corporation. The record shows, however, that in response to a motion to compel, Andersen made the financial records of the corporation available for review and inspection by Woodward. A letter from Woodward's attorney dated February 1, 1993, states that he hired an accountant to perform a review of all corporate records at the campground office. The record indicates that Andersen did not allow such an audit to be performed. Instead, the record contains a letter dated March 8, 1993, stating that such a request was too broad and stating that a document request should be provided. A letter dated March 11, 1993, indicates that a settlement was then reached between the parties. On March 29, 1993, a shareholder agreement was executed which was incorporated into the divorce decree. Under the decree, Andersen transferred 245 shares of her 500 shares to Woodward. The decree states that [Woodward] acknowledges that [Andersen] is not indebted to W.E. & N.W., Inc. nor does W.E. & N.W., Inc. have any claims against [Andersen]. The agreement indemnifies both Woodward and Andersen for all liabilities asserted against them as past or present officers, directors, or employees of the corporation. The agreement provides that to the extent not indemnified by the corporation, the parties agreed to bear in equal shares any liabilities that arose by virtue of any distribution, compensation payment, cash transfer, or other property transfer from the corporation to any person at any time or any liabilities by virtue of Andersen's or Woodward's actions or admissions as a shareholder, officer, or director of the corporation. The parties also agreed to indemnify each other against liability transpiring after entry of the decree. The agreement also has provisions for indemnification between the parties. The record does not contain evidence of a resolution or provision allowing the corporation to indemnify Andersen for attorney fees. The agreement states that it was designed in part to provide for past and future liabilities and to place certain restrictions on Andersen's control of the corporation. Woodward contends that he and Andersen agreed that he would be made an officer of the corporation. The agreement, however, does not include such a provision. After the divorce, Woodward was made an officer of the corporation, but was later removed.