Court Opinion

ID: 9917413
Source: CourtListenerOpinion
Date Created: 2024-01-12 15:01:48.938778+00
Date Added: 2024-06-11T08:01:13.255662
License: Public Domain

REL: January 12, 2024

Notice: This opinion is subject to formal revision before publication in the advance sheets of Southern Reporter.
Readers are requested to notify the Reporter of Decisions, Alabama Appellate Courts, 300 Dexter Avenue,
Montgomery, Alabama 36104-3741 ((334) 229-0650), of any typographical or other errors, in order that corrections
may be made before the opinion is published in Southern Reporter.

 ALABAMA COURT OF CIVIL APPEALS
                               OCTOBER TERM, 2023-2024
                                _________________________

                                         CL-2023-0288
                                   _________________________

                                    Sharon Smith Gartrell

                                                      v.

                               Edward Conant Gartrell, Jr.

                         Appeal from Madison Circuit Court
                                   (DR-21-900713)

MOORE, Judge.

        Sharon Smith Gartrell ("the wife") appeals from a judgment

entered by the Madison Circuit Court ("the trial court") divorcing her

from Edward Conant Gartrell, Jr. ("the husband").                                        We affirm the

judgment in part, reverse it in part, and remand the case with

instructions to the trial court.
CL-2023-0288

                              Background

     The parties married in 1998 and separated in July or August 2021.

On August 24, 2021, the wife filed a complaint for a divorce.         On

September 24, 2021, the husband answered the complaint and filed a

counterclaim for a divorce. At the trial on January 3, 2023, the wife

sought, among other things, an award of periodic alimony and an

equitable division of the marital property, which, she claimed, included

the property held by the Gartrell Family Express Trust ("the trust"), a

testamentary trust established for the benefit of the husband by his

mother when she died in 2014. The parties presented competing evidence

as to whether the husband had regularly used the corpus and income

from the trust for the common benefit of the parties during the marriage.

The parties also disputed whether the proceeds of the trust could be used

by the husband to pay periodic alimony.

     On March 9, 2023, the trial court entered a final judgment that,

among other things, declared the husband's interest in the trust to be the

separate property of the husband, divided the marital property without

including the trust property, and declined to award the wife periodic

                                    2
CL-2023-0288

alimony. In the judgment, the trial court set forth the following reasons

for denying the wife periodic alimony:

     "Neither party in this case is employed and neither has
     significant income. [The wife] contends that [the husband]'s
     access to income from [the trust], which was funded by [the
     husband]'s mother and in which [the wife] has no legal
     interest, is a source available to [the husband] for payment of
     her requested alimony. That contention can be justified only
     if [the trust], or income therefrom, was 'used regularly for the
     common benefit of the parties during the marriage.' Ala. Code
     [1975, §] 30-2-51 .... The requirement of 'regular use' is not
     established by the evidence herein. See, e.g., Ratliff v. Ratliff,
     5 So. 3d 570 (Ala. Civ. App. 2008). Accordingly, [the wife]'s
     request for alimony is DENIED."

(Capitalization in original.)     On April 6, 2023, the wife filed a

postjudgment motion seeking to alter or amend the judgment. The trial

court denied that motion on April 11, 2023. The wife filed a notice of

appeal to this court on May 3, 2023.

                                  Issues

     The wife argues that the trial court erred in declining to award her

periodic alimony, in failing to reserve the right to award her periodic

alimony in the future, in determining that the husband's interest in the

trust was the separate property of the husband, and in failing to

equitably divide the marital property. However, to properly dispose of

                                     3
CL-2023-0288

the appeal, we need only consider whether the evidence supports the

determination that the trust property and income were the separate

property of the husband and whether the trial court erred in declining to

award the wife periodic alimony. We therefore pretermit discussion of

the other issues.

                          Standard of Review

     As to the trial court's determination that the trust property and

income were the separate property of the husband, we review the

judgment to determine whether the trial court abused its discretion. See

Morgan v. Morgan, 322 So. 3d 531, 537 (Ala. Civ. App. 2020).          In

determining whether the trial court abused its discretion, we presume

the correctness of the findings of fact in the judgment, which were based

on ore tenus evidence, and we will disturb the judgment only if it is

plainly and palpably wrong. Id. at 537-38.

     As to whether the trial court erred in declining to award the wife

periodic alimony, the wife primarily argues that the trial court erred as

a matter of law by applying Ala. Code 1975, § 30-2-51, to determine that

the income from the trust could not be considered as a source for paying

periodic alimony. That argument presents a question of law. We review

                                   4
CL-2023-0288

questions of law de novo, without affording any presumption of

correctness to the trial court's decision. Rose v. Rose, 70 So. 3d 429, 431

(Ala. Civ. App. 2011).

                            Property Division

     Section 30-2-51(a), Ala. Code 1975, provides:

     "If either spouse has no separate estate or if it is insufficient
     for the maintenance of a spouse, the judge, upon granting a
     divorce, at his or her discretion, may order to a spouse an
     allowance out of the estate of the other spouse, taking into
     consideration the value thereof and the condition of the
     spouse's family. Notwithstanding the foregoing, the judge
     may not take into consideration any property acquired prior
     to the marriage of the parties or by inheritance or gift unless
     the judge finds from the evidence that the property, or income
     produced by the property, has been used regularly for the
     common benefit of the parties during their marriage."

In this case, the wife argues that pursuant to § 30-2-51(a), the corpus of

the trust and the income received by the husband as the beneficiary of

the trust should be classified as marital property because, she argues,

both were used regularly for the common benefit of the parties during the

marriage.

     In a part of the judgment labeled "Separate Estate," the trial court

found that "[the husband]'s interest in [the trust] constitutes his separate

estate, and [the wife] is entitled to no interest therein."         In the

                                     5
CL-2023-0288

immediately preceding section, labeled "Alimony," the trial court applied

§ 30-2-51(a) to determine that the trust property and the trust income

could not be considered a source of income for periodic-alimony purposes.

Reading those two sections of the judgment together, it is apparent that

the trial court determined that the husband's interests in the corpus and

in the income of the trust were his separate property because neither

were regularly used for the common benefit of the parties during the

marriage. We do not completely agree with the analysis employed by the

trial court, but we agree with the trial court's conclusion that the trust

property and the trust income were not subject to equitable division.

     Section 30-2-51(a) applies only to "property acquired" by a spouse.

We have not been directed to any Alabama caselaw defining that term,

but, for the purposes of equitable distribution, that term refers to

property to which a spouse has obtained a right to legal ownership. See

Brett R. Turner, 1 Equitable Distribution of Property § 5:21 (4th ed.

2023). "Property that is owned by third parties was not acquired by the

parties ...." Id. at § 5:14. Generally, the assets of an irrevocable trust

are considered the property of a third party. 2 Equitable Distribution of

Property at § 6:94. As a beneficiary of a trust, a person does not acquire

                                    6
CL-2023-0288

the assets of the trust. See Ex parte Boykin, 656 So. 2d 821, 826 (Ala.

Civ. App. 1994). As the husband argues, the corpus of the trust could not

be classified as marital property so long as it remained within the legal

ownership of the trust. See 2 Equitable Distribution of Property § 6:94.

The wife did not argue for dissolution of the trust, and none of the assets

of the trust were ever distributed to the husband, so the trust assets

remained the property of a third party and, thus, were not subject to

equitable division. As a beneficiary, the husband maintained only an

interest in the corpus of the trust, which, because it was bestowed solely

upon him by gift or inheritance, was properly considered his separate

property. Id. at § 6:94. Despite the wife's argument to the contrary, the

family's use of a truck that was owned by the trust, even if the use was

regular, would not transform the corpus of the trust into marital

property.

     As opposed to the corpus of a trust, income received by a beneficiary

from a trust may be treated as marital property once the beneficiary

obtains a vested interest in the income. See Id. at § 6:94 n.22. At the

point the income becomes payable, the beneficiary has "acquired" the

income because the beneficiary has a legal right to payment. See Moore

                                    7
CL-2023-0288

v. Moore, 111 S.W.3d 530, 535 (Mo. Ct. App. 2003). Assuming, without

deciding, that income received from a testamentary trust can be

classified as property acquired by gift or inheritance even though the

income is realized after the original transaction, that income would be

divisible as marital property only if it was used regularly for the common

benefit of the parties during the marriage.

     The wife primarily relies on evidence indicating that the husband

deposited trust income into his personal bank account throughout 2020

and 2021.   The wife maintains that, because the husband used his

personal bank account to pay the marital living expenses, the deposits

proved that the husband had regularly used the trust income for the

common benefit of the parties. The husband testified that, before 2020,

he had deposited the trust income into a trust account maintained by

Morgan Stanley. During the COVID-19 pandemic, he lost access to that

account so, he said, he deposited the trust income into his personal bank

account. The husband denied that any distributions of trust income had

ever been used to pay for the marital living expenses, and the wife

admitted that she had no evidence indicating that any distributions had

been used to pay for marital debts or to purchase marital assets.

                                    8
CL-2023-0288

     The wife also references the purchase of a recreational vehicle that

the husband purchased using trust income.           The parties used the

recreational vehicle to attend football games and to visit Lake

Guntersville before selling it. Other than the recreational vehicle, the

husband made no other purchases using trust income during the

marriage. The husband testified that he had routinely returned any

distributions into the trust account for reinvestment to build up the

account. The lone purchase of the recreational vehicle is not sufficient to

prove a regular use of trust income as required by § 30-2-51(a). See

Ratliff v. Ratliff, 5 So. 3d 570, 582 (Ala. Civ. App. 2008) (citing Bushnell

v. Bushnell, 713 So. 2d 962, 964 (Ala. Civ. App. 1997)) (interpreting the

word "regularly" as used in § 30-2-51(a), Ala. Code 1975, to mean

frequent or periodic use of the property to satisfy needs of the family); see

also Hull v. Hull, 887 So. 2d 904, 908 (Ala. Civ. App. 2003) (holding that

a one-time use of property for the common benefit of the parties cannot

be considered "regular").

                             Periodic Alimony

     Section 30-2-51(a) formerly governed awards of both property and

periodic alimony in divorce actions. See Nichols v. Nichols, 824 So. 2d

                                     9
CL-2023-0288

797 (Ala. Civ. App. 2001) (applying § 30-2-51(a) in a property-division

case); Shewbart v. Shewbart, 64 So. 3d 1080, 1088 (Ala. Civ. App. 2010)

(applying § 30-2-51(a) to explain how to analyze a periodic-alimony

claim). We have not been referred to any case holding that the corpus of

a trust or trust income cannot be considered a source from which periodic

alimony may be paid pursuant to § 30-2-51(a), but we find no need to

reach that issue.

     In 2017, the Alabama legislature enacted a new law, now codified

at Ala. Code 1975, § 30-2-57, that governs the determination of claims for

periodic alimony in divorce actions commenced on or after January 1,

2018. See Ala. Acts 2017, Act No. 2017-164, § 3; Merrick v. Merrick, 352

So. 3d 770, 773 (Ala. Civ. App. 2021) (stating that "[t]he issue of alimony

in the present case is governed by Ala. Code 1975, § 30-2-57").

     Section 30-2-57(e) provides, in pertinent part, that,

     "in determining whether the other party has the ability to pay
     alimony, the court shall consider any and all evidence,
     including all of the following:

                "(1) His or her own individual assets, except
           those assets protected from use for the payment of
           alimony by federal law."

                                    10
CL-2023-0288

(Emphasis added.) By its plain language, § 30-2-57(e) indicates that the

individual assets of the payor spouse shall be considered as a source from

which periodic alimony can be paid unless the assets are protected by

federal law. Section 30-2-57 does not provide that assets inherited by a

payor spouse may be considered a source for the payment of periodic

alimony only when those assets have been regularly used for the common

benefit of the parties during the marriage. "When the legislature uses

language that is plain and unambiguous, there is no room for judicial

construction; instead, the statute should be applied as written." J.L.M. v.

S.A.K., 18 So. 3d 384, 388 (Ala. Civ. App. 2008).

     The legislature did not repeal § 30-2-51(a) when it enacted § 30-2-

57, and we find no inconsistency between the two statutes. Section 30-2-

51(a) still governs property division. When dividing marital property, a

trial court still may not consider property inherited by a spouse unless

that property "has been used regularly for the common benefit of the

parties during their marriage." § 30-2-51(a); see, e.g., Burkett v. Burkett,

367 So. 3d 409, 422 (Ala. Civ. App. 2022). Section 30-2-51(a) remains

effective, but it does not govern determinations of claims for periodic

alimony, which are now governed by § 30-2-57, a separate statute. See

                                    11
CL-2023-0288

Samayamanthula v. Patchipulusu, 338 So. 3d 787, 796 (Ala Civ. App.

2021) (noting that § 30-2-51(a) controls property division while § 30-2-57

controls claims for periodic alimony).

     In the judgment, the trial court specifically expressed that the

income from the trust would not be considered as a source for periodic

alimony because the wife did not prove that the husband had regularly

used his income from the trust for the common benefit of the parties as

required by § 30-2-51(a). The trial court erred in applying § 30-2-51(a)

when denying the wife's claim for periodic alimony. That error was not

a mere scrivener's error, as the husband maintains, but was a

substantive error that prejudiced the wife and one that only reversal of

the judgment can cure. The evidence showed that the trust held assets

worth approximately $1,600,000 and consistently generated income,

including a gross income of approximately $50,000 in 2021. If the trial

court had considered that income as a source from which periodic alimony

could be paid, the trial court may have reached a different determination

regarding the periodic-alimony claim.

                                    12
CL-2023-0288

                               Conclusion

     For the foregoing reasons, we affirm the judgment insofar as it

determined that the trust property and the trust income were not subject

to equitable division. We reverse the judgment insofar as it denied the

wife's request for periodic alimony, and we remand the case with

instructions for the trial court to vacate the portion of the judgment

adjudicating the claim for periodic alimony and to reconsider that claim

without applying § 30-2-51(a). We recognize that the husband asserted

in the trial court reasons other than the ones discussed in this opinion

why the trust should not be considered a source from which to pay

periodic alimony. On remand, the trial court may consider those reasons

in ruling on the wife's periodic-alimony claim.       Because "property-

division and alimony awards are considered to be interrelated, we often

reverse both aspects of the trial court's judgment so that it may consider

the entire award again upon remand." Redden v. Redden, 44 So. 3d 508,

513 (Ala. Civ. App. 2009). Accordingly, we also reverse the judgment

with respect to the property-division award so that the trial court can

reconsider it along with the wife's claim for periodic alimony.

                                    13
CL-2023-0288

    AFFIRMED IN PART; REVERSED IN PART; AND REMANDED

WITH INSTRUCTIONS.

    Thompson, P.J., and Edwards, Hanson, and Fridy, JJ., concur.

                                14