Opinion ID: 1057654
Heading Depth: 2
Heading Rank: 2

Heading: Commingling and Substantial Contribution

Text: The inquiry does not end there. Even if the increase in value of the premarital contributions was initially separate property, it may have become marital property by way of commingling or substantial contribution. Because the record has not yet been sufficiently developed on these points, I would remand.
[S]eparate property becomes marital property [by commingling] if inextricably mingled with marital property or with the separate property of the other spouse. Langschmidt, 81 S.W.3d at 747 (quoting 2 Homer H. Clark, The Law of Domestic Relations in the United States § 16.2 at 185 (2d ed. 1987)). It is only when the separate property continues to be segregated or can be traced into its product, [that] commingling does not occur. Id. (quoting 2 Clark, The Law of Domestic Relations in the United States § 16.2 at 185); see also White v. White, No. E2006-00595-COA-R3-CV, 2007 WL 63602, at -5 (Tenn.Ct.App. Jan.10, 2007) (affirming holding that appreciation of premarital contributions to a 401(k) could be traced and thus was not commingled). The spouse claiming that the property is not marital bears a rebuttable presumption of a gift to the marital estate. Langschmidt, 81 S.W.3d at 747 (quoting 2 Clark, The Law of Domestic Relations in the United States § 16.2 at 185). Mr. Snodgrass attempted to introduce the testimony of a certified public accountant, Janice Smith, for the purpose of segregating the increase in value of his premarital contributions from the total increases in value of his 401(k) account. Mrs. Snodgrass argued, however, that the testimony was not relevant because if it is a `retirement benefit,' then the [entire] appreciation during the marriage is marital, regardless of any tracing or segregation. The trial court granted the motion to exclude the testimony. On appeal, Mrs. Snodgrass has raised objections to Ms. Smith's methodology. While those objections may be sound, the trial court erred by excluding the testimony as irrelevant based on the mistaken theory of the law advanced by Mrs. Snodgrass. Thus, I would remand to the trial court to determine whether Mr. Snodgrass could establish that the increase in value of his separate property was not inextricably commingled with the marital portions of his account.
An increase in the value of separate property may also be classified as marital if each party substantially contributed to [the property's] preservation and appreciation. Tenn.Code Ann. § 36-4-121(b)(1)(B). Substantial contribution may include, but [is] not . . . limited to, the direct or indirect contribution of a spouse as homemaker, wage earner, parent or family financial manager, together with such other factors as the court having jurisdiction thereof may determine. Tenn.Code Ann. § 3 6-4-121(b)(1)(D); see also Keyt v. Keyt, 244 S.W.3d 321, 328-29 (Tenn.2007). Because of the state of the record, it is impossible to determine whether Mrs. Snodgrass substantially contributed to the increase in value of Mr. Snodgrass's premarital contributions through, for example, her contributions to the financial management of Mr. Snodgrass's 401(k), or whether the reverse would be true. I would have directed the trial court to consider these issues on remand.