Opinion ID: 1138826
Heading Depth: 1
Heading Rank: 4

Heading: the retzer lifestyle

Text: Mr. Retzer's management of the restaurants was quite successful. With less than $30,000 in 1971, the business had grown and flourished, and they were quite wealthy in 1988. The second restaurant in Greenville at the time of trial had been a consistent money loser, and another, the Clarksdale restaurant, was marginal, but the others highly successful. As above noted there were seven restaurants in told. [2] The chancellor in his September 7, 1988, opinion estimated that the net worth of them both, consisting mainly of the value of the restaurants, was $4,100,000. He found that of this figure Mrs. Retzer had a net worth of $1,100,000, consisting almost entirely of the value of her corporate shares in Retzer and Retzer, Inc., and Mr. Retzer had a net worth of $3,000,000. To get some concept of the part each of them played in the accumulation of these assets, it is necessary to examine their lifestyle. As above noted, Mrs. Retzer did not teach after 1972, and took no part in the business. Although Mr. Retzer testified she had no money whatever in the original investment and that she had consistently spent and overspent everything she made, it is possible several thousand dollars of her teacher's salary was initially invested in the first restaurant. Also, the banks for several years at least required her signature along with his on all loans. According to Mr. Retzer, from the beginning Mrs. Retzer was continually in financial distress. It was a constant irritant and dilemma in our marriage. (Vol. V, 249). He discussed the problem with his attorney in 1975. In their 1979 divorce he was shown a list of bills totaling $26,300, one being a $5,500 note to a local bank, of which he knew nothing, and was called upon to pay. They each had separate personal bank accounts. For the years 1980-87 the corporation paid each the following salaries and bonuses: YEAR MR. RETZER MRS. RETZER 1980 $ 187,423.20 $ 16,350.00 1981 $ 190,823.20 $ 18,800.00 1982 $ 204,436.00 $ 20,775.00 1983 $ 231,377.00 $ 21,596.00 1984 $ 260.540.00 $ 21,590.00 1985 $ 279,077.00 $ 21,591.00 1986 $ 224,539.00 $ 21,610.00 1987 $ 233,769.24 $ 33,611.20 _____________ ___________ TOTAL $1,811,984.64 $175,923.20 Also for 1980-86 their joint income tax returns showed the following: Gross Taxable Federal State Income Income Tax Tax 1980 $195,637 $172,534 $ 63,030 $ 6,280 1981 $212,816 $137,508 $ 50,068 $ 8,234 1982 $264,494 $196,633 $ 15,912 $ 4,774 1983 $599,398 $543,984 $110,639 $26,583 1984 $642,266 $117,445 $117,445 $22,005 1985 $460,229 $389,283 $ 76,449 $12,714 1986 $445,595 $393,695 $ 84,887 $18,170 Mr. Retzer's testimony as to her uncontrolled spending and incurring debts was essentially uncontradicted. He had given her over $40,000 worth of jewelry himself during the marriage. She had bills for dresses from all over the country, many costing more than $3,000. Typically, she would incur a large bill, pay something like $100 month for six to eight months, and then the crunch would come. (Vol. VI, 658) She had personal notes at several banks in Greenville. He expressed exasperation that the banks made loans to her freely. Her checking account in Planters Bank was constantly overdrawn. He related a 1985 example of this chronic problem, which she conceded was accurate. Mr. Retzer was on the board of directors of Planters Bank, and every month at the board meeting the names of overdrawn depositors and amounts would be called out. To avoid embarrassing him, an officer at the bank would call him prior to each meeting, inform him of the overdraft that month, and Mr. Retzer would pay the overdraft. During that year the bank officer called him and told him that Mrs. Retzer's account was $4,700 overdrawn. He told the banker to let the checks bounce. When the checks bounced, Mrs. Retzer came to the office and threw a fit. She broke valuable porcelain and a Picasso plate. (Vol. VI, 659) He called the pastor to calm her down. Upon Mrs. Retzer's promise never to stray again, he paid off the overdraft. The woman needs no encouragement to spend vast sums of money. (Vol. VIII, 1138) Mr. Retzer described the problem during cross-examination: Q. Mr. Retzer, with your proven business ability, are you telling this Court that there was not any way that you could close accounts, take credit cards, give notice to people that extend credit, to keep Mrs. Retzer from spending sums of money like that? A. Mr. Merideth, I want to tell you that I tried every system, every permutation of system under the sun to control Mrs. Retzer. Had her on a cash basis, had her on no credit cards, had her write a letter to every account in town closing the account. I did everything short of taking out a full page ad in the DDT telling people I would not be responsible for my wife's debts, yet every merchant in town when she walks in will accept her signature and let her carry out anything. As you have clearly seen, every banker in town will lend her large amounts on her signature without financial statements. Not even a court order, Mr. Merideth, can restrain her spending and what is the penalty for me when she starts bouncing things and her credit goes bad? I get rejections from people on credit. I get credit card rejections. My credit goes bad. This happened in '84 and since that time I've made sure that Mrs. Retzer and I never had a joint account again, but that's the punishment for me, Mr. Merideth, and the answer to your question  I never developed a system to control her. Q. You certainly could have closed her credit at the Planters Bank  you're a director there? A. No, sir, she went in and got it on her own. I did not instruct the Planters Bank not to loan to customers, and she had it before I knew about it. Q. She had it before you knew about it? A. Um-hm (affirmative response). Q. You could have told Chuck do not lend my wife anymore money on that board and he would not have loaned her anymore money. A. She had it before I knew about it. That loan is several years old and the only thing that gets paid on it is interest. Q. She's gone back since then and borrowed more at Planters, hasn't she? A. I don't know. She probably has. She's borrowed everywhere else in town, Mr. Merideth. (Vol. VI, 660-661) Mr. Retzer testified that of the salaries and bonuses each received from the corporation it was their initial intention for Mrs. Retzer to pay for the groceries and children's clothes out of her compensation, and he would pay all their other expenses from his salary and bonus, including mortgage payment, interest, insurance, taxes. Then, at the end of the year they would split what was left. Because of her spending this did not work out (Vol. VIII, 1140), he claiming she spent $35-40 thousand each year on dresses alone. Why this did not work out, and her spending problem can be illustrated by Exhibit 37 (Vol. V, 442) and their financial difficulty in March, 1987. This exhibit, among other things, shows that in 1986 the total sum spent for groceries was $11,646.35, and total sum spent for children, including their clothes, was $5,307.08, totaling $16,953.43. Mrs. Retzer's personal income from the corporation that year was $21,600, leaving her a balance of $4,656.67. As above noted, the total income of them both from the corporation for the year 1986 was $256,227.30. That year she wrote checks from her account totaling $72,327.30. Of this she spent $40,574 on personal items for herself, another $10,599.59 went into a small business venture between Mrs. Retzer and a friend, called Fantasy. Mr. Retzer deposited $36,009.67 from his account to hers. That year Mr. Retzer expended $47,162.72 from his account, of which $18,825.48 was for personal items for himself, the remainder in investment, with the exception of a $1,100 political contribution. The expenditures that year which could be classified as expenses for them both totaled $145,463.21. In March, 1987, Mrs. Retzer was upset with what she claimed were approximately $27,000 overdue bills. At that time they were in something of a financial bind, and in order to pay these bills, Mr. Retzer agreed to go on her note at a bank for $27,000. Once the loan had been made, Mrs. Retzer informed him of another $8,000 in bills she had forgotten, and the corporation thereupon gave her a bonus of $12,000. On May 12, 1987, Mrs. Retzer personally borrowed $5,407 from the local Trustmark Bank, and on June 29 borrowed $6,000 from Magnolia Federal in Greenville to completely finish paying off her debts. (Vol. III, 103) In August and September, 1987, she obtained loans totaling $17,500 from the local Sunburst Bank and in November her mother let her have $13,000. Finally, in January, 1988, she borrowed another $5,000 from Sunburst. She said she secured $57,000 in loans to pay off her debts. She never purchased any stocks or bonds, or had a savings account. In the first six months of 1987, Mr. Retzer spent $38,840.43 from his account, of which $8,416.46 went on personal expenses for himself, $750.00 went to a political contribution, and $16,000 went for a membership in Catfish Point, an exclusive recreation club of which he was a general partner. He stated this would later be recouped because he had purchased three memberships, and when he sold two of them, his investment would be returned. Mrs. Retzer wrote checks during the same period from her account totaling $22,539.73, of which $16,952.23 was for herself, $2,525 went into Fantasy, and $2,862.50 was disbursed to Mrs. Trudy Boyette, Mrs. Retzer's mother. Mr. Retzer wrote checks to her from his account totaling $9,845.28. Expenses which could be classified as expenses for them both for the six-month period totaled $134,121.76. Following the separation in July, 1987, the corporation paid Mrs. Retzer $1,178 every four weeks, and he paid her an additional $1,150 every four weeks, totaling $2,522 per month. Also, following the separation, Mr. Retzer paid $11,000 per month for her household expenses and $850 per month on the April 1, 1987, note at the bank, altogether totaling $14,372 per month. At a pendente lite hearing before the chancellor in February, 1988, Mrs. Retzer requested he pay her another $3,000 monthly in order to pay her additional debts and maintain her standard of living. The chancellor allowed her an additional $1,000 per month on her other bills, and directed her to refrain from incurring any additional indebtedness until this matter is resolved. He also allowed her accountant's fee of $4,940 and attorney's fee of $7,585. Although directed by the chancellor at the February hearing to refrain from incurring any additional debts, Mrs. Retzer later gave her maid a $529.00 ring as a present, and on April 25, 1988, because she was depressed, she purchased for herself a jewelry pin costing $3,800. (Vol. III, 138) In the twelve months following April, 1987, Mrs. Retzer did not curtail her purchase of items of personal luxury. Exhibit 36 shows that her balances due for jewelry, liquor and clothing increased from $5,740 to $11,368. She bought $1,600 worth of intoxicating beverages from a local liquor store. Mrs. Retzer did not deny her extravagance, and admitted she was a poor manager, giving as her only excuse that he, too, overspent. Mr. Retzer had gone on an African safari, taking his son, and a trip to Barbados with his children, each trip costing approximately $5,000. The family spent two weeks in France, renting a house for $5,500, and one of the weeks Mr. Retzer had his parents over to stay with them. He had two watches costing several thousand dollars each, and upon cross-examination when Mrs. Retzer's counsel asked him if he would take $4,000 for the one he had on, Mr. Retzer took it off and sold it to him. There had been a lavish birthday party for Mr. Retzer in New Orleans, costing thousands of dollars, but he attributed the outlandish cost to her, saying she had handled it and it got out of hand. Mr. Retzer, active in the Republican Party, had also financed an expensive dinner in Washington for state and national political leaders. The Retzers were apparently generous to Mrs. Retzer's mother, Mrs. Boyette, the Retzers paying for her cosmetic surgery costing several thousands of dollars. Also, they rented a house to Mrs. Boyette for $375 a month, a modest rental for the investment. Mr. Retzer testified at trial that she could live there as long as she chose. In August, 1988, in a note to Mr. Retzer, requesting a loan of over $5,000 for the house she had bought on Kirk Circle in Greenville, Mrs. Retzer also asked that he reimburse her $301.50 she had paid on Mrs. Boyette's medical bill. During the summer of 1988, following the divorce hearing, Mrs. Retzer went to Houston, Texas, for removal of a mole and cosmetic surgery of some kind. She testified her local dermatologist had found the mole and told her he could remove it. She chose instead to go to Houston, Texas, for its removal and for the cosmetic surgery. At the August, 1988, hearing she could not recall what the surgery was for or the amount she had paid. While being examined by the chancellor, she could not tell him whether Mr. Retzer had given her $4,000 or $8,000 the previous month, saying when the court asked her questions, it frightens me and he's frightened me. (Vol. VIII, 1091) Mrs. Retzer testified that until their separation, Mr. Retzer had never complained seriously about her spending, that he had teased her about it.