Court Opinion

ID: 5139374
Source: CourtListenerOpinion
Date Created: 2021-12-21 20:13:59.183911+00
Date Added: 2024-06-11T08:24:17.103533
License: Public Domain

12/21/2021
               IN THE COURT OF APPEALS OF TENNESSEE
                           AT NASHVILLE
                        Assigned on Briefs November 1, 2021

       PAULA HARRIS, CONSERVATOR FOR SAUNDRA RICHEY v.
                RUEBEN “ROYCE” RICHEY ET AL.

              Appeal from the Chancery Court for Williamson County
               No. 19CV-48682B         Michael W. Binkley, Judge
                     ___________________________________

                           No. M2021-00331-COA-R3-CV
                       ___________________________________

This appeal arises from a divorce action, in which the wife’s conservator alleged that the
husband had been dissipating marital assets and had withdrawn money from joint accounts.
As a result, the trial court ordered the husband to deposit the withdrawn funds with the
court’s clerk and master. The wife passed away before the trial court could adjudicate the
divorce action. The husband filed a motion requesting that the court return the funds to
him because the divorce action had abated upon the wife’s death. The trial court dismissed
the suit but denied the husband’s motion and ordered the clerk and master to continue
holding the funds until they could be transferred to the probate court upon the filing of a
petition to probate the wife’s estate. The husband has appealed. Having determined that
the trial court erred by exercising subject matter jurisdiction over the disposition of the
funds after the divorce action had abated, we reverse the trial court’s decision to withhold
the funds from the husband and retain them with the clerk and master.

      Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court
               Affirmed in Part, Reversed in Part; Case Remanded

THOMAS R. FRIERSON, II, J., delivered the opinion of the court, in which W. NEAL
MCBRAYER and KENNY W. ARMSTRONG, JJ., joined.

Robert H. Plummer, III, Franklin, Tennessee, for the appellant, Rueben “Royce” Richey.

Peggy S. Pulley, Ashland City, Tennessee, for the appellee, Paula Harris, Conservator for
Saundra Richey.
                                            OPINION

                            I. Factual and Procedural Background

       In May 2019, Saundra Richey (“Wife”) vacated the marital residence where she had
lived with the respondent, her husband, Reuben “Royce” Richey (“Husband”), and was
hospitalized as a result of dementia. The petitioner, Paula Harris, became Wife’s appointed
conservator (“Conservator”) in August 2019. On September 3, 2019, Conservator filed a
petition in the Williamson County Chancery Court (“trial court”) for legal separation on
behalf of Wife, alleging, inter alia, that Husband and Christy Schrage, Husband’s daughter
from a previous marriage, had removed $30,000.00 from a Wells Fargo joint checking
account; $60,000.00 from a Regions joint checking account; sold $11,867.79 worth of joint
stock; sold $87,519.11 of additional joint stock; and removed $144,658.96 from a joint
Ameritrade account. According to the petition for legal separation, Husband made these
withdrawals in July and August of 2019. Ms. Schrage alleged in a subsequent motion that
Husband thought Conservator was “scheming to try to take his money” and that
Conservator had told her that she had filed the petition for legal separation to protect
Conservator’s children’s interest in Wife’s assets as beneficiaries named in Wife’s will.1

       Conservator requested in the petition for legal separation that the trial court issue an
ex parte emergency restraining order to protect Wife’s share of marital assets and enjoin
Husband and Ms. Schrage from “transferring, utilizing, accessing, hiding or any way
disposing of ANY marital property.” On September 3, 2019, the trial court granted
Conservator’s request, entering a temporary restraining order, pursuant to Tennessee Code
Annotated section 36-4-106(d) (2021), and an order to appear and show cause. The trial
court also directed Husband to provide the court with a full accounting of “all funds
removed by [Husband] and[/]or Ms. Schrage from each one of the accounts listed in the
petition for legal separation.”

       On September 19, 2020, Conservator filed a motion for civil contempt, alleging that
Husband had violated the temporary restraining order by dissipating $856.34 of marital
funds and failing to provide a full accounting of the withdrawn funds. In an order entered
on September 20, 2019, the trial court found that Husband had failed to render the
accounting. Consequently, Husband was ordered to submit the filing. In addition, the trial
court directed that the temporary restraining order remain in “full force and effect” with
the exception of Husband’s monthly income of $8,291.25, which Husband was permitted
to use for living expenses. The court also ordered the remaining marital funds that had
been withdrawn to be deposited into Wife’s attorney’s escrow account. However, once
Husband and Ms. Schrage provided the court with a complete accounting and a check in

1
  Conservator’s children are named as beneficiaries in Wife’s will and are identified as Wife’s
grandchildren. Therefore, it appears that Conservator is a daughter of Wife from a previous marriage.
                                                -2-
the amount of $179,340.23, the court instead determined that the funds should be deposited
with the clerk and master in an interest-bearing account.

       On October 8, 2019, Husband filed a counter-petition for divorce and an answer to
Wife’s petition for legal separation. Before the trial court had the opportunity to adjudicate
either Wife’s petition for legal separation or Husband’s counter-petition for divorce, Wife
passed away on October 24, 2020. On November 4, 2020, Husband filed a motion to
dismiss Wife’s petition for legal separation and requested that the court enter an order
returning the funds being held by the clerk and master to him, arguing that the case had
abated upon Wife’s death.

        Conservator filed a response to Husband’s motion, acknowledging that Wife had
died but contesting Husband’s request for immediate return of the funds held in the registry
of the court. Conservator posited that although the funds had previously been owned by
Husband and Wife jointly, the funds ceased to be held by the entirety when Husband placed
the funds in an account solely in his name. Therefore, according to Conservator, the funds
became “individually owned marital funds subject to division by the court,” and a portion
belonged to Wife’s estate. Furthermore, Conservator contended that the executrix of
Wife’s estate would be able to file “for a determination of the exact amount that should be
released to each party.” Nonetheless, Conservator further alleged that the executrix’s
attorney had indicated to her that the executrix would not be requesting that the trial court
determine the amount that should be paid to Wife’s estate or seeking those funds on behalf
of Wife’s estate.2 In turn, Conservator requested that the court not dismiss the instant action
or, in the alternative, retain the funds held by the clerk and master “pending the outcome
of any motions filed in the Probate Court.”

        The trial court conducted a hearing to address Husband’s motion on November 19,
2020. The court entered an order on December 14, 2020, in which it, inter alia, continued
the hearing to January 14, 2021; ordered Husband to file a suggestion of death and a death
certificate evincing Wife’s death; determined that it would retain jurisdiction over the issue
of payment of reasonable attorney’s fees from the funds maintained by the clerk and
master; and determined that it would retain jurisdiction over the remaining funds held in
the court’s registry “until such time as [Wife’s] estate is opened for probate and said funds
can be transferred to the appropriate Probate Court.” Thereafter, Husband filed a
suggestion of death and death certificate indicating that Wife had passed away on October
24, 2020.

2
 Although Conservator does not name the executrix in her response, Wife’s Last Will and Testament lists
Husband and Margaret O’Neal Dunn as co-executors of the will. Husband’s attorney in this matter, Robert
H. Plummer, III, was the attorney who prepared Wife’s will and was permitted to continue to represent
Husband by agreed order entered on September 19, 2019. Conservator alleged in her response that Mr.
Plummer represented the “executrix” as well as Husband and that Mr. Plummer had indicated that the
executrix would not be requesting that the trial court determine the amount of funds to be paid to Wife’s
estate.
                                                  -3-
       Husband subsequently filed a motion requesting that the trial court return to him at
least one-half of the funds held by the clerk and master by reason that only one-half of the
funds would be subject to the probate court’s jurisdiction. Husband argued that there would
be no basis for the entire amount to be controlled by the trial court. Husband also asserted
that he had been financially dependent upon the rental income from his business and that
these rental payments had ceased in December 2020. Therefore, according to Husband, he
needed the funds held by the clerk and master in order to defray his current living expenses.

       On January 11, 2021, a guardian ad litem, whom the trial court had appointed to
determine Husband’s best interest, filed a response in support of Husband’s motion,
asserting that Husband needed funds for living expenses.3 Conservator filed a response on
January 11, 2021, contending that the trial court had already determined that the funds held
by the clerk and master would be transferred to the probate court. Thus, she postulated that
Husband’s motion was nothing more than a request for a “second bite at the apple.”

       Upon conducting a second hearing concerning Husband’s motion to dismiss and
return funds as well as his separate motion to return one-half of the funds, the trial court
entered an order on February 1, 2021, determining:

              Petitioner/Wife passed away on October 24, 2020 and as such it is
        appropriate to dismiss this case in its entirety.

               It is of the utmost urgency that the proper petition is filed to open the
        Estate of [Wife] for probate.

                Respondent/Husband has lost his primary source of income with the
        final closing of his business.

               As the Court retained jurisdiction over the marital funds at the last
        hearing held on November 19, 2020, it is within the Court’s authority and
        discretion to provide funds from those held by the Williamson County
        Chancery Court Clerk and Master to Respondent/Husband for living
        expenses and to pay property taxes prior to turning them over to the Probate
        Court handling the Estate of [Wife].

              All attorneys have provided the Court with affidavits of fees as
        ordered on November 19, 2020 and, as the Court retained jurisdiction over
3
  In an order entered on September 16, 2020, the trial court appointed a guardian ad litem to discern the
best interest of Husband, who was then ninety-three years old. The court entered this order due to its
concern that Ms. Schrage may have been taking advantage of Husband. However, the guardian ad litem
concluded in her report that Ms. Schrage’s actions with respect to Husband’s funds were not “malicious or
criminal.”
                                                  -4-
           previously stated marital funds, it is within the Court’s authority and
           discretion to review the affidavits and make a determination of awarding the
           fees from said marital money.

                   While this Court understands the situation [Husband] finds himself in,
           the Court does not feel it appropriate to grant his motion as written for one-
           half of the marital assets at this time.

(Paragraph numbering omitted.) As a result, the trial court dismissed Wife’s petition for
legal separation and Husband’s counter-petition for divorce; ordered the clerk and master
to disburse funds for the payment of property taxes and $4,000.00 for Husband’s living
expenses; and declared that its prior order “that the remaining marital funds shall stay
within the jurisdiction of this Court until a petition is filed to probate the Estate of [Wife]
shall remain in effect.”

       On March 1, 2021, the trial court entered separate orders granting requests for
reasonable attorney’s fees from Wife’s attorney, Husband’s attorney, and the guardian ad
litem. Husband timely appealed.

                                              II. Issue Presented

           Husband presents one issue on appeal, which we have restated slightly as follows:

           Whether the trial court erred by determining that it retained subject matter
           jurisdiction over the disposition of marital funds after the divorce action had
           abated with Wife’s death.4

                                          III. Standard of Review

       We review a non-jury case de novo upon the record with a presumption of
correctness as to the findings of fact unless the preponderance of the evidence is otherwise.
See Tenn. R. App. P. 13(d); In re Estate of Fletcher, 538 S.W.3d 444, 448 (Tenn. 2017)
(“This matter was heard without a jury; therefore, our standard of review is de novo upon
the record of the proceedings below with a presumption of correctness as to the trial court’s
factual determinations, unless the evidence preponderates otherwise.”). However, our
review of the court’s legal conclusions is de novo with no presumption of correctness.
Estate of Fletcher, 538 S.W.3d at 448; see Blankenship v. Blankenship, 59 S.W.3d 115,
117 (Tenn. Ct. App. 2001).

      Whether a court has subject matter jurisdiction over a case is a question of law,
reviewed de novo with no presumption of correctness. Word v. Metro Air Servs., Inc., 377

4
    Conservator did not file a brief in response.
                                                     -5-
S.W.3d 671, 674 (Tenn. 2012). Subject matter jurisdiction “involves a court’s power to
adjudicate a particular controversy brought before it.” First Am. Trust Co. v. Franklin-
Murray Dev. Co., L.P., 59 S.W.3d 135, 140 (Tenn. Ct. App. 2001). Our Supreme Court
has previously concluded that “issues regarding a court’s subject matter jurisdiction should
be considered as a threshold inquiry” and “should be resolved at the earliest possible
opportunity.” In re Estate of Trigg, 368 S.W.3d 483, 489 (Tenn. 2012).

       Concerning the applicable standard of review, this Court has explained:

       A challenge to the court’s subject matter jurisdiction calls into question the
       court’s authority to adjudicate the controversy before it. Chapman v. DaVita,
       Inc., 380 S.W.3d 710, 712 (Tenn. 2012). Subject matter jurisdiction can only
       be conferred by the constitution or a legislative act. Id. When a party
       challenges a court’s subject matter jurisdiction, the court must “determine
       the gravamen of the case and identify the source of its power to adjudicate
       that type of controversy.” Word v. Metro Air Servs., Inc., 377 S.W.3d 671,
       674 (Tenn. 2012). The question of whether a court has subject matter
       jurisdiction over a case is a question of law, which we review de novo with
       no presumption of correctness. Id.

Roland Digital Media, Inc. v. City of Livingston, No. M2018-00163-COA-R3-CV, 2019
WL 117582, at *4 (Tenn. Ct. App. Jan. 7, 2019).

                IV. Subject Matter Jurisdiction Over Disposition of Funds

       Husband argues that the trial court no longer maintained subject matter jurisdiction
over the disposition of the funds held by the clerk and master after Wife passed away and
the actions for legal separation and divorce abated. We agree with Husband that the legal
separation and divorce actions, along with any ancillary matters, abated upon Wife’s death,
depriving the trial court of judicial power to retain the funds held in the registry of the
court.

        As our Supreme Court has previously noted: “It is a well-settled principle of law
that a pending divorce action, being purely personal in nature, abates upon the death of one
of the parties.” Blackburn v. Blackburn, 270 S.W.3d 42, 47 (Tenn. 2008); see Steele v.
Steele, 757 S.W.2d 340, 342 (Tenn. Ct. App. 1988) (“[I]f an action for a divorce is
commenced, and one of the parties dies thereafter, but before the entry of the final decree,
the action abates.”). Furthermore, when the suit abates upon the death of the party, “the
jurisdiction of the court to proceed with the suit is terminated.” Steele, 757 S.W.2d at 342.
The termination of the divorce action also “abates all ancillary or interlocutory decrees.”
McMahon v. Butler, No. 85-349-II, 1986 WL 5894, at *2 (Tenn. Ct. App. May 23, 1986)
(citing Keidel v. Keidel, 383 A.2d 264, 267 (R.I. 1978) (concluding that an “interlocutory
                                            -6-
decree to partition real estate, being ancillary to the court’s divorce jurisdiction, must abate
when the divorce action itself abates.”)); but see Coleman v. Olson, 551 S.W.3d 686, 697
(Tenn. 2018) (“[A] trial court should have the authority to ‘right a wrong’ and remedy an
injustice based on equitable considerations when a party violates a statutory injunction and
later dies while the divorce action is pending.”).

       In the present case, no final decree of divorce appears in the record, and it is
undisputed that the trial court had not yet adjudicated Wife’s petition for legal separation
or Husband’s counter-petition for divorce when Wife died. As such, the divorce action
was still pending at the time of Wife’s death in October 2020. Ergo, the trial court correctly
dismissed the actions for legal separation and divorce by its February 1, 2021 order.

        However, upon careful review, we determine that the trial court erred in determining
that it retained subject matter jurisdiction over the disposition of funds maintained by the
clerk and master. These funds were originally held as a consequence of the legal separation
and divorce actions and, accordingly, the holding of funds by the court was ancillary to
those actions. The court ordered Husband to deposit the funds with the court upon
Conservator’s request for a temporary restraining order in the petition for legal separation
in order to protect Wife’s “share of the marital assets” after Husband had withdrawn funds
from joint bank accounts. Upon Wife’s death, the funds were no longer subject to division
by the court upon separation or divorce inasmuch as such actions had abated and could not
proceed. Therefore, without the underlying actions for legal separation and divorce, the
trial court lacked subject matter jurisdiction concerning the disposition of funds and had
no judicial power to withhold them from Husband. See Steele, 757 S.W.2d at 342 (“The
judicial power is ended when a party dies before the entry of a decree . . . .”).

        Although our High Court appeared to reject a strict application of the abatement rule
in Coleman v. Olson, we find the facts of that case distinguishable from the facts of the
present one and conclude that the exception to the abatement rule recognized in Coleman
has no application here. See Coleman, 551 S.W.3d at 696-97 (citing Aither v. Estate of
Aither, 913 A.2d 376, 379 (Vt. 2006)) (adopting the Vermont Supreme Court’s “flexible
approach that would allow the trial court to remedy the violation of the injunctive order,
after a divorce action had abated, by considering the equities of the parties.”).

        Coleman involved a situation in which the wife sued her husband for divorce, fell
ill, changed the beneficiary of her life insurance policy from her husband to her mother,
and subsequently passed away before a hearing on her suit for divorce could be conducted.
Coleman, 551 S.W.3d at 688. The husband sued his mother-in-law to recover the life
insurance benefits. Id. The trial court awarded the insurance benefits to the couple’s child,
despite the wife’s violation of the statutory injunction, pursuant to Tennessee Code
Annotated § 36-4-106(d), prohibiting parties to a divorce from changing the beneficiary of
any life insurance policy that names either party as beneficiary. Id. On appeal, this Court
reversed and awarded the husband the life insurance benefits. Id. In so doing, this Court
                                            -7-
adopted the Vermont Supreme Court’s reasoning in Aither v. Estate of Aither, in which that
court held that “the trial court could remedy the violation of an injunction following the
abatement of a divorce action by considering the equities of the parties.” Id. at 694 (citing
Aither, 913 A.2d 376, 379 (Vt. 2006)). In so considering the equities, this Court concluded
that the husband should have been awarded the life insurance benefits. Coleman, 551
S.W.3d at 694.

        The issue presented to our Supreme Court in Coleman was whether the husband
could recover the life insurance proceeds from the wife based on her violation of the
statutory injunction even though the divorce case had abated with her death. Id. at 696.
Our Supreme Court concluded that the divorce action had abated upon the wife’s death
and, as such, the statutory injunction had become ineffective. Id. Notwithstanding, our
High Court also adopted the Vermont Supreme Court’s flexible approach to the abatement
rule, holding that although a divorce action abates with the death of a party, a trial court
“should have the authority to consider the equities of the parties and remedy the violation
of a statutory injunction.” Id. at 697. As a consequence, our High Court agreed with this
Court’s adoption of Vermont’s flexible approach to the abatement rule with respect to that
particular set of facts, although it ultimately reversed this Court’s finding that the equities
favored the husband. Id.

       Our High Court in Coleman limited this exception to the abatement rule to instances
when a party to a divorce violates “a statutory injunction and later dies while the divorce
action is pending.” Id. Although the trial court in the instant cause entered an order
enjoining either party from dissipating marital property, pursuant to Tennessee Code
Annotated section 36-4-106(d), Husband had withdrawn the funds from joint accounts and
sold joint stock prior to Conservator’s filing of the petition for legal separation. Therefore,
the funds at issue were not obtained by Husband in violation of a statutory injunction or
temporary restraining order. Ergo, we conclude that Coleman has little application to the
present case. Instead, we find the facts of McMahon v. Butler, 1986 WL 5894, at *2, more
comparable to the present case.

       In McMahon, the husband died before the trial court could enter an order dividing
marital property although the court had already granted the couple a divorce. McMahon,
1986 WL 5894, at *1. Upon the husband’s death, the wife requested that the trial court
dismiss the action. Id. The trial court denied the wife’s motion and entered an order
“purporting to resolve all the property rights of the parties.” Id. On appeal, this Court
reversed the trial court’s decision, concluding:

       The wife had not agreed to a division of the property; in fact the property
       rights of the parties were being litigated and the final decision on that aspect
       of the case had not been made. Under those circumstances we think the death
       of the husband terminated the action setting aside all preliminary orders and
       terminating the power of the trial court to make any further orders in the case.
                                             -8-
              Therefore, the orders of the trial court entered after the death of the
        husband are reversed and the cause is dismissed.

Id. at *3 (emphasis added).

       Similarly, in the case at bar, the trial court had not ruled on Conservator’s petition
for legal separation, Husband’s counter-petition for divorce, or any aspect of division of
marital property, which included the funds held by the clerk and master. Therefore, the
death of Wife effected a termination of the actions for legal separation and divorce. All
preliminary orders, including the court’s orders requiring Husband to deposit funds with
the clerk and master, should have been set aside rather than extended. Thus, we reverse
the portion of the trial court’s order retaining subject matter jurisdiction respecting the
disposition of the funds and remand to the trial court so that it can release the funds held
by the clerk and master back to Husband.5

        Husband also contends that predicated upon our Supreme Court’s ruling in In re
Estate of Fletcher, 538 S.W.3d 444 (Tenn. 2017), the funds held by the clerk and master
would constitute his sole property. See Fletcher, 538 S.W.3d at 454 (“[O]nce a husband
or wife withdraws funds from a joint bank account held as tenants by the entirety, the funds
cease to be held by the entirety.”). Because we have now concluded that the trial court
lacked subject matter jurisdiction over the disposition of the funds held in the registry of
the court and that such funds should be returned to Husband, we need not address
Husband’s contention in this regard. See McMahon, 1986 WL 5894, at *3 (“Our decision
on this issue disposes of the appeal, making it unnecessary to take up the other issues raised
by the appellant.”).

                                             V. Conclusion

       For the foregoing reasons, we reverse the portion of the judgment wherein the trial
court retained subject matter jurisdiction over funds held by the clerk and master and
withheld the funds from Husband. We remand this case for collection of costs below and
release of the funds at issue to Husband. Costs on appeal are taxed to the appellee, Paula
Harris as Conservator for Saundra Richey.

                                                          s/ Thomas R. Frierson, II_____________
                                                          THOMAS R. FRIERSON, II, JUDGE

5
 We clarify that our decision does not impact the trial court’s award of reasonable attorney’s fees to Wife’s
attorney, Husband’s attorney, and the guardian ad litem. See New v. Dumitrache, 604 S.W.3d 1, 20 (Tenn.
2020) (“Even when a case is dismissed for lack of subject matter jurisdiction, the court retains power to
award attorney’s fees and costs.”).
                                                   -9-