Court Opinion

ID: 4126669
Source: CourtListenerOpinion
Date Created: 2017-02-16 16:03:20.219597+00
Date Added: 2024-06-11T07:46:21.801825
License: Public Domain

Cite as 2017 Ark. 33

                 SUPREME COURT OF ARKANSAS
                                        No.   CV-16-10

                                                  Opinion Delivered: February   16, 2017

ERIN POTTS
                                APPELLANT APPEAL FROM THE SEBASTIAN
                                          COUNTY CIRCUIT COURT
V.                                        [NO. DR-2013-858]

TIMOTHY D. POTTS                                  HONORABLE JIM SPEARS, JUDGE
                                   APPELLEE

                                                  REVERSED AND REMANDED;
                                                  COURT OF APPEALS’ OPINION
                                                  VACATED.

                    COURTNEY HUDSON GOODSON, Associate Justice

        Appellant Erin Potts appeals the decree entered by the Sebastian County Circuit

 Court divorcing her from appellee Timothy D. Potts. She also contests the denial of her

 motion for reconsideration. For reversal, Erin contends that the circuit court erred by

 deciding the parties’ property issues and modifying their agreement regarding custody and

 visitation without a hearing. Further, she asserts that the court erred by omitting from the

 decree their agreement for Tim to move to Northwest Arkansas. We agree that the circuit

 court erred in depriving the parties of a hearing on the issues in dispute, and we reverse and

 remand.

        The record reflects that Erin and Tim married in January 2010 and separated in

 September 2013. The union produced one child, a daughter, J.P. Tim filed a complaint

 for divorce in October 2013 seeking joint custody of J.P. and an equitable distribution of

 the parties’ assets and liabilities. Erin answered the complaint and also filed a counterclaim
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for divorce. She sought sole custody of their daughter and that Tim be required to pay

child support. Erin also asked for the circuit court to determine their property rights and

the allocation of their debts, unless otherwise agreed upon by the parties. Tim subsequently

filed an amended complaint alleging that he should be awarded custody of the child. He

also claimed that he had acquired a home before the marriage and that it should be awarded

as his separate, nonmarital property. In December 2013, the circuit court entered an order

granting Erin temporary custody of J.P., setting Tim’s visitation, and requiring him to pay

child support.

       The circuit court scheduled a two-day, final hearing to begin on July 29, 2014. Prior

to that date, Erin filed a motion for continuance, citing discovery problems. The circuit

court heard this motion and denied it. In its ruling, the court assured the parties that the

case did not have to be concluded at that time and that it would “continue on” until they

rested their cases.

       At the hearing on July 29, the parties announced that they had settled the custody

issue, and they stated their agreement on the record as follows. They agreed to share joint

custody of J.P. by alternating custody of her on a weekly basis. Their settlement included

the right of first refusal to care for the child when the parent exercising custody could not

keep her. The parent who surrendered his or her time with the child would have the right

to make up that lost time. Because Tim is a school teacher, they agreed that he would be

allowed to make up his unspent time during school breaks, holidays, and summer vacations.

Overnight visitation on Friday evenings during Erin’s week was also stated as an option.

Exercising the right to make up lost time was conditioned upon it not interfering with

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previously established plans. The parties were to mutually agree on a daycare facility at the

midpoint between their residences that would serve as the location for exchanging the child.

The parties were also to make an effort to live in the same school district. In this regard,

Tim was to make a good-faith effort to move to Fayetteville, but if he could not do so or if

it was not affordable, then Erin was to make a good-faith effort to relocate to Rogers.

Further, the parties agreed “that if at any time the Court finds by a preponderance of the

evidence that one parent demonstrates a pattern of willfully creating conflict in an attempt

to disrupt the current pending joint custody arrangement, then the Court may deem such

behavior as a material change of circumstances and may change joint custody to an order of

primary custody to the non-disruptive parent.”

       With the permission of the circuit court, the parties reserved the property issues, and

they agreed to work on a settlement. Tim offered testimony to establish residency and his

grounds for divorce. The circuit court stated that it would sign a decree approved by the

parties.

       A decree had not been entered by November 4, 2014. On that date, Tim filed a

motion to modify the joint-custody arrangement.            He alleged that Erin had been

uncooperative and had repeatedly shown bad faith by ignoring, denying, or delaying nearly

all of his requests to make up lost time. Tim also asserted that Erin had required him to

pick up J.P. at her home as opposed to the daycare center, which reduced his time with J.P.

He claimed that he was entitled to sole custody of J.P. pursuant to their agreement, and he

submitted his affidavit in support of his accusations. In her response to the motion, Erin

denied Tim’s allegations and asserted that it was Tim who had consistently attempted to

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create conflict and disagreement. She maintained that Tim was dissatisfied with the terms

of the agreement because she had been keeping J.P. while Tim was at work.

       In conjunction with her response, Erin, through her counsel, wrote a letter to the

circuit court dated November 13, 2014. She stated that the problems the parties were

encountering concerned her tardiness in dropping off J.P. at daycare and their inability to

agree upon Tim’s additional time with the child. A proposed decree to address those

difficulties was attached to the letter. Erin indicated that she objected to the settlement of

the property issues as contained in a proposed decree drafted by Tim and noted that her

proposal included an order for them to enter into settlement negotiations for ninety days,

and if that failed, for them to enter mediation.

       Tim’s counsel responded with a letter to the circuit court, stating that the parties had

agreed for Tim to draft a decree setting out the custody agreement and containing an offer

for the division of property and debts. Tim complained that Erin had not indicated why

the proposed property settlement was not satisfactory and that he had not received a

counteroffer from her. He indicated that the decree proposed by Erin did not accurately

reflect the custody agreement. In addition, he objected to mediation and advised that if

they could not reach a settlement of the property issues, the court could hold a brief hearing.

Tim also requested a hearing on his motion to modify the custody agreement.

       On November 21, 2014, the circuit court wrote a letter advising the parties that it

was setting aside the parties’ agreement regarding the right of first refusal because it had

“become too cumbersome.” The court also stated that if the parties did not settle the

property dispute within ten days, the marital home and its contents would be sold and the

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proceeds divided equally. Also, by an order entered on November 24, 2014, the circuit

court granted Tim sole custody of J.P. Although no hearing had been held, the court found

that Erin had “repeatedly ignored, denied, or delayed the Plaintiff’s request to make up time

with the parties’ minor child as was required by the parties’ agreement.”

       In response to the circuit court’s letter ruling regarding the sale of the home, Tim’s

counsel wrote another letter to the court stating that the home had been owned by Tim

before the marriage. Tim indicated that he had purchased the property for $129,000 and

that he had applied a $10,000 gift from his grandfather toward the purchase price. Tim also

informed the court that the balance of the mortgage was $108,000. He attached an appraisal

of the property and claimed that the home had decreased in value, and he noted that it was

Erin’s burden to prove that the home had increased in value. Based on this information,

Tim asked the circuit court to reconsider its letter ruling.

       Erin’s attorney responded with a letter dated November 26, 2014:

                Please consider this letter a request that you allow the parties an additional ten
       (10) days to try and resolve any outstanding property issues. The Defendant would
       further request that the court not piecemeal the property issues as requested by the
       Plaintiff. With regard to the change in visitation referenced in the Court’s letter, the
       Defendant would request that the Court refrain from making any modifications to
       prior rulings until evidence has been presented. At this point, there has been much
       hearsay in the lengthy letters and pleadings filed by the Plaintiff. There has been no
       actual proof presented to the Court that the parties have not been getting along or
       that it is the fault of the Defendant. It is clear that the Plaintiff is dissatisfied with the
       fact the Defendant has been able to watch the minor child during the day. Essentially,
       Plaintiff is telling the Court that the parties cannot get along so he should get exactly
       what he wanted in the first place. Keep in mind that the Plaintiff is not losing any
       time with the parties’ child while the Defendant is keeping her during the day.
       Again, the Defendant is requesting that the Court only consider evidence properly
       before the Court and is objecting to the introduction or consideration of any of the
       items the Plaintiff has attempted to introduce through letters to the Court or
       attachments to pleadings.

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              The Defendant respectfully requests that the Court set this matter for a hearing
       so that any decision to modify this Order be based upon actual facts and evidence
       rather than hearsay propounded by the Plaintiff. Thank you for your time and
       consideration regarding this matter, and I hope we are able to have a hearing in the
       near future so that these misunderstandings might be resolved.

       The circuit court authored another letter on December 10, 2014, which set a date

of no later than December 19, 2014, for the parties to reach an agreement. The court

observed that Tim had purchased the home prior to the marriage but ruled that Erin would

be entitled to equity resulting from the reduction of principal by the expenditure of marital

funds. The circuit court also found that Erin was not entitled to any increased value given

the current market value, unless marital funds had been used for improvements made to the

property.

       On January 27, 2015, Tim’s counsel wrote a letter to the court and attached two

proposed decrees. One version ordered the sale of all personal property. Counsel indicated

that the other, preferred, version contained what Tim had agreed upon, and he represented

that it was “very close” to the only proposal received from Erin. In the letter, Tim identified

four disputed items of personal property that he was claiming and submitted a thank-you

note from his parents to support his contention that he should be awarded one of the items,

noting that Erin would receive a dresser that had been a gift from Erin’s aunt. Tim also

stated that his parents had contributed $6,000 toward the vehicle Erin was driving and that

despite this substantial gift to him, Erin would be awarded the vehicle in the proposed

decree. Although Tim said that this particular award would result in Erin’s receiving far

more in value than he would, he stated that he would agree to this disposition if the decree

were accepted by the court. He explained that the preferred version of the decree also

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divided the parties’ debts, representing that to his knowledge, Erin did not dispute the

amount of the debt or that he had been servicing their debt. Tim also attached an

amortization schedule to support his calculation of Erin’s share of the reduction in principal

on the home.

       On February 4, 2015, the circuit court entered the decree preferred by Tim. Erin

filed a timely motion for reconsideration and to modify the decree. She argued that the

decree contained multiple provisions that had not been agreed upon by the parties and for

which no testimony had been taken. She asked the circuit court to set aside the custody

provisions and to enter a decree to reflect the parties’ custody agreement. Erin also asserted

that the court should set aside the provisions relating to the division of marital property and

set a hearing. Finally, Erin argued that the court should modify the decree to allow her to

exercise visitation during spring break in 2015 because the decree allowed Tim a continuous

period of custody for twenty-two days. In response, Tim argued that the decree did not

designate spring break as a visitation period for either party because their agreement

contained specific arrangements for the holidays of Easter and Pascha, which were likely to

interfere with spring break. Further, Tim asserted that Erin had ample opportunity to

present countervailing proof but that she had failed to do so. Tim also filed a motion to

modify the decree to include a provision for visitation on Halloween.

       By order dated February 23, 2015, the circuit court denied Erin’s motion for

reconsideration. The court found that “based upon the testimony of the parties and the

statements of counsel at the July 24, 2014 hearing and based upon the Court’s review of

letters from counsel and the pleadings in this case, there is sufficient evidence to support the

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Court’s entry of the Decree of Divorce as entered on February 4, 2015.” The court

modified the decree to include Halloween visitation. The circuit court also found that “the

parties did not intend that either party be awarded Spring Break visitation.”

       Thereafter, Erin filed a timely notice of appeal from the decree and the order denying

reconsideration.    On March 2, 2015, the circuit court entered an order denying

reconsideration and modifying the decree identical to the one filed on February 23, 2015.

The only difference between the two orders is that the March order included the attorneys’

signatures under the statement “Agreed as to Form and Content.” Erin filed an amended

notice of appeal to include a review of this order.

       The appeal was first heard by the court of appeals, which affirmed that portion of the

decree dividing the parties’ property and their debts, but reversed and remanded on the issue

of custody. We accepted Erin’s petition for review. When this court grants a petition for

review, we treat the appeal as if it had been originally filed in this court. Brave v. Brave,

2014 Ark. 175, 433 S.W.3d 227.

                                Division of Property and Debts

       Erin argues that the circuit court’s findings on the division of property and debts are

clearly erroneous because the circuit court did not conduct a hearing and thus had no

evidence upon which it could have properly made those decisions. She contends that the

circuit court’s findings are based solely on statements of Tim’s counsel found in letters

written to the court. Erin points out that she objected to the court’s consideration of the

letters as evidence and that she made requests for the circuit court to hold a hearing to

resolve these issues.

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       With respect to the division of property in a divorce case, we review the circuit

court’s findings of fact and affirm them unless they are clearly erroneous or against the

preponderance of the evidence. Jones v. Jones, 2014 Ark. 96, 432 S.W.3d 36. A finding is

clearly erroneous when the reviewing court, on the entire evidence, is left with a definite

and firm conviction that a mistake has been committed. Conlee v. Conlee, 370 Ark. 89, 257
S.W.3d 543 (2007).

       We agree with Erin that the circuit court erred in accepting Tim’s version of facts

and events in dividing the parties’ property and debts. Just as statements made by attorneys

during a trial are not evidence, Union Pac. R.R. v. Sharp, 330 Ark. 174, 952 S.W.2d 658

(1997), counsel’s statements of the kind here cannot be regarded as evidence upon which

to make findings of fact and conclusions of law. This was not a case where the parties agreed

to submit disputed issues to a court for resolution based on stipulations, briefing, or letters.

For instance, in Metz v. Langston, the parties agreed to present a contested issue to the circuit

court for decision based on letters, briefs, proposed orders, and supporting documentation

offered by their counsel. Metz, 2015 Ark. App. 319, 463 S.W.3d 305. When the court

accepted the husband’s proposed order, the wife filed a motion for reconsideration and asked

for a hearing. The wife appealed the denial of her motion, asserting that she had been

denied due process. The court of appeals found no merit in the argument, holding that the

wife had waived any right to a hearing by agreeing to submit proposed orders for the judge

to sign accompanied by supporting documentation and by failing to request a hearing until

after the issues had been decided. By contrast, here, the parties did not agree for the circuit

court to decide the case in this fashion. On the contrary, Erin objected to proceeding in

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this manner and requested a hearing prior to the circuit court’s decision. We hold that a

circuit court may not resolve contested factual issues by dispensing with a hearing and

accepting the position offered by one party over the other party’s objection.

       We are cognizant of Tim’s argument that Erin has failed to demonstrate prejudice

resulting from the circuit court’s rulings because she has not shown that its findings are

erroneous. However, the circuit court’s decision is clearly erroneous because it is not based

on evidence properly introduced at a hearing. In this situation, a party in Erin’s position is

hard-pressed to make such a showing without having been afforded a hearing to present

evidence. To hold otherwise would excuse the circuit court’s having decided contested

issues without a hearing. This we will not do.

       Tim further contends that Erin acquiesced in the action taken by the circuit court

because her attorney approved the “form and content” of the March order denying her

motion for reconsideration. Again, we disagree. In our view, the signature under that

designation represents a statement that the order accurately reflects a circuit court’s ruling.

It cannot be construed as the equivalent of an agreed order.

                                           Custody

       Along the same lines, Erin contends that the circuit court erred by modifying custody

and visitation without a hearing. For the reasons discussed above, we also hold that the

circuit court clearly erred by rendering decisions regarding custody and visitation without a

hearing. It is particularly troublesome that the circuit court would deny the parties an

opportunity to present evidence regarding custody, which is an issue that requires the court

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to determine what is in the best interest of the child. We therefore reverse on this point as

well.

        Reversed and remanded; court of appeals’ opinion vacated.

        Brent D. Watson, Attorney at Law, PLLC, by: Brent D. Watson, for appellant.

        Medlock, Gramlich & Sexton, LLP, by: Sam Sexton III, for appellee.

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