Opinion ID: 1711352
Heading Depth: 1
Heading Rank: 23

Heading: Whether the chancellor erred in the distribution of marital assets.

Text: ¶ 71. The prenuptial agreement was determined to be valid and enforceable by the chancellor. This determination is affirmed. Both Julie and Ray agreed to the arrangement and signed the prenuptial agreement in 1987. Accordingly, the prenuptial agreement is controlling in the distribution of the assets. The agreement stated in part the following: This agreement is intended to cover and apply to all property now owned by each party and to all property which each may acquire in his or her sole and separate right, and to any property acquired by an exchange, lease, mortgage or otherwise, to any property vesting by purchase, reinvestment, substitution, increase, descent, gift, bequest, or devise, and to proceeds derived from any sale. The agreement does not apply to property as to which title is taken after their marriage in the names of both parties as joint tenants or tenants by the entirety. While the chancellor upheld the agreement, he noted that his decision on the distribution of marital assets would have been the same even if the agreement was determined to be unenforceable. Of vital importance in the case sub judice is evidence that the parties'meticulously maintained separate accounts for their premarital separate property and for the gifts and inheritances that they each received during the marriage. Again, the chancellor wrote a very detailed opinion with more than six pages devoted to the distribution of assets. The chancellor's equitable distribution analysis considered the Ferguson factors. See Ferguson v. Ferguson, 639 So.2d 921, 928 (Miss.1994). ¶ 72. There is a limited standard of review on appeal for issues addressing the division and distribution of property in divorces. Owen v. Owen, 798 So.2d 394, 397 (Miss.2001) (citing Reddell v. Reddell, 696 So.2d 287, 288 (Miss.1997)). The chancellor's ruling of the division and distribution will be upheld if it is supported by substantial credible evidence. Id. (quoting Carrow v. Carrow, 642 So.2d 901, 904 (Miss.1994)). This Court will not substitute its judgment for that of the chancellor `[e]ven if this Court disagree[s] with the lower court on the finding of fact and might ... [arrive] at a different conclusion.' Id. at 397-98 (quoting Richardson v. Riley, 355 So.2d 667, 668 (Miss.1978)). ¶ 73. When reviewing the Ferguson factors, a chancellor may consider only the factors that he or she deems to be applicable to the property placed before the chancery court's consideration. Id. at 398. Accordingly, not all of the eight factors must be considered in every case. Id. Ferguson set forth the following guidelines to assist a chancellor in the evaluation and distribution of assets: Although this listing is not exclusive, this Court suggests the chancery courts consider the following guidelines, where applicable, when attempting to effect an equitable division of marital property: 1. Substantial contribution to the accumulation of the property. Factors to be considered in determining contribution are as follows: a. Direct or indirect economic contribution to the acquisition of the property; b. Contribution to the stability and harmony of the marital and family relationships as measured by quality, quantity of time spent on family duties and duration of the marriage; and c. Contribution to the education, training or other accomplishment bearing on the earning power of the spouse accumulating the assets. 2. The degree to which each spouse has expended, withdrawn or otherwise disposed of marital assets and any prior distribution of such assets by agreement, decree or otherwise. 3. The market value and the emotional value of the assets subject to distribution. 4. The value of assets not ordinarily, absent equitable factors to the contrary, subject to such distribution, such as property brought to the marriage by the parties and property acquired by inheritance or inter vivos gift by or to an individual spouse; 5. Tax and other economic consequences, and contractual or legal consequences to third parties, of the proposed distribution; 6. The extent to which property division may, with equity to both parties, be utilized to eliminate periodic payments and other potential sources of future friction between the parties; 7. The needs of the parties for financial security with due regard to the combination of assets, income and earning capacity; and, 8. Any other factor which in equity should be considered. Ferguson v. Ferguson, 639 So.2d 921, 928 (Miss.1994). ¶ 74. The chancellor determined that while Ray paid most of the consideration for the assets, Julie nevertheless made substantial contributions to the family and Ray's success. Each party was determined to have expensive tastes and expended the marital assets. There was no emotional ties to the marital property, and the value is discussed in a subsequent paragraph. The chancellor enforced the prenuptial agreement, which provided for each party to keep property brought to the marriage as well as separate inheritance and gifts. The chancellor acknowledged that Ray had an estate that was substantially larger than Julie's estate, and the chancellor considered this factor to be important in the analysis. [5] There were no unique tax or economic consequences. Further, the chancellor stated that he previously addressed the issue of assets and considered that Julie receives some dividends and had substantial earning capacity considering her education and skills. The chancellor also considered finality and stated that Julie was not entitled to alimony, but that disparity of the estates was considered and the property division would eliminate the need for periodic payments with the exception of child support payments. ¶ 75. The chancellor divided the marital property. The Mabuses had three pieces of real property, a pension account, some marital debt and personal property considered by the chancellor. The marital home was valued at $250,000 with no debt associated with it. A lot in Kiva Dunes, Alabama, was valued at $350,000 with no debt associated with it. Sixteen acres of land in Ridgeland was valued at $450,000 with no debt associated with it. However, there was a marital debt of $255,000 and Ray's pension. The chancellor divided the property as follows: Julie was to receive $125,000 in exchange for a quitclaim deed to the marital home; Julie was to receive the Kiva Dunes property valued at $350,000; Ray was to receive the Ridgeland property valued at $450,000 and assume the $255,000 in marital debt; and Julie was to receive one half of Ray's pension [6] in the amount of $9,126.66. The parties split the personal property. The chancellor also ruled on the child support issue that Ray pay Julie the tax free sum of $4,100 per month in child support for the months that she had physical custody of the children, $1,200 per month for the months Ray had physical custody of the children, and Ray was to pay the children's tuition for private school and medical insurance. ¶ 76. Julie argues that the chancellor should have considered marital and non-marital assets; alimony, especially in light of Julie's sacrifice of 13 years of life for Ray's political career; and the disparity of the estates. She argues that she aided in the management of his father's estate, participated in his political career for 13 years without compensation, and helped to keep his books on investments and contributed to the appreciation of Ray's assets. Julie contends that she relieved Ray of many details concerning reporting, record keeping and decision making on the utilization of the assets. ¶ 77. Ray argues that Julie never lived a life of sacrifice during their marriage. He cites to the testimony that there always was domestic help during the marriage, the children always had a nanny, he paid for the expenses, and he did not prevent her from working. Ray contends he had received his inheritance prior to the marriage. Furthermore, Ray argues that Julie received approximately 60% of the marital assets ($484,126.66), even though she made no financial contribution to the acquisition of the property, whereas Ray received approximately 40% of the assets ($329,126.66). In addition, he claims there was no transmutation of separate property into marital property and cites the chancellor's finding that the separate accounts were meticulously maintained. As for any claim of increase in valuation of non-marital property during the marriage, Ray contends that there was no evidence presented by Julie. Without conceding his position, Ray argues that any increase in value to the gifted and inherited assets, was passive and not a result of Julie's contributions. Ray testified that Lanny Autry, a professional forester employed by Ray, managed and made the decisions concerning the timber property. Neither Ray nor Julie had expertise in timber management and any increase was not due to efforts by Julie or Ray. Likewise, Ray argues that any of his brokerage accounts were placed in a mutual fund selected by a broker. ¶ 78. The chancellor determined that the prenuptial agreement was valid and enforceable, as such, the agreed division of the property in the agreement is controlling. Coupled with the agreement is the testimony of the maintenance of separate assets during the marriage. The chancellor also determined that the property was maintained in separate accounts for their premarital property as well as for gifts and inheritances received during the marriage. The chancellor acknowledged that Ray used income from his inherited property to pay household bills which became marital property. However, the chancellor noted that this did not convert the remainder of Ray's separate property to marital property. The chancellor further stated: Our Mississippi Supreme Court has ruled similarly in Johnson v. Johnson, 650 So.2d 1281 (Miss.1994), stating that funds used for the benefit of the family became marital property, but the funds and assets which were not so used remained separate. An entire inheritance does not become marital property merely because a portion of it was used for the benefit of the family. Each party's separate property is sufficiently identifiable and shall remain non-marital property not subject to equitable distribution. See A & L, Inc. v. Grantham, 747 So.2d 832 (Miss.1999). Contrary to Julie's contention, the chancellor addressed the issues of Julie's contribution to the marriage and disparity of the separate estates. [7] The chancellor in his Ferguson analysis stated that Julie's contributions will not be overlooked by this Court. The opinion further stated that Julie helped to keep the financial records for the family and made substantial contributions to the family and to Ray's success. As to the disparity in the estates, the chancellor specifically stated that clearly, Julie's separate estate of gifts, inheritance, and separate property is minor in comparison to Ray's separate estate. This Court considers this factor to be important in the case at hand. The chancellor also considered the disparity of the estates and stated that the court would make a property division which would eliminate the need for periodic payment, excluding child support payments. ¶ 79. Julie argues that she contributed to the appreciation in value of Ray's non-marital assets. She testified that she worked on the estate of Ray's father. She could not remember if Ray had paid her for the work. Ray testified that he paid Julie $3,000 for her work on the estate. During the course of the marriage, Julie kept meticulous records of the expenses. However, there is no evidence that Julie handled the timber or brokerage assets other than to provided monthly accountings of all expenses and records. The chancellor had already noted Julie's contribution to the family in keeping track of the records. However, this does not amount to active participation in the increase of value of non-marital assets. Accordingly, this issue is without merit.