Court Opinion

ID: 4378277
Source: CourtListenerOpinion
Date Created: 2019-03-19 12:06:11.129748+00
Date Added: 2024-06-11T14:49:26.005098
License: Public Domain

IN THE COURT OF APPEALS OF NORTH CAROLINA

                                   No. COA18-920

                                Filed: 19 March 2019

Buncombe County, No. 11 CVD 3725

JAMES BRYAN SLUDER, Plaintiff,

              v.

MARILYN W. SLUDER, Defendant.

       Appeal by defendant from order entered 4 April 2018 by Judge Andrea E. Dray

in Buncombe County District Court. Heard in the Court of Appeals 29 January 2019.

       Siemens Family Law Group, by Diane K. McDonald, for plaintiff-appellee

       Charles R. Brewer for defendant-appellant

       BRYANT, Judge.

       Defendant Marilyn W. Sluder appeals from the trial court’s order on equitable

distribution concluding that a refinanced mortgage was a marital debt to be paid

equally by defendant and plaintiff James Bryan Sluder. Where the findings of fact

are supported by competent evidence and support the conclusions of law, we affirm

the trial court’s ruling.

       Plaintiff and defendant were married on 25 June 1994 until they separated on

1 July 2007. An absolute divorce was entered on 29 October 2012. During the course

of their marriage, the parties acquired several items of property, including real estate

properties. One of the properties was a residential property on Panorama Drive. On
                                  SLUDER V. SLUDER

                                  Opinion of the Court

the date of separation, the parties had an existing mortgage of $207,780.21 on the

Panorama Drive property.

       Prior to any court involvement, the parties entered into a mutual separation

and property settlement agreement regarding the division of their marital assets and

debts on 28 February 2008.       The separation agreement listed, inter alia, the

Panorama Drive property as marital property “formerly used by the parties as their

family residence” and noted that the parties agreed to be “equally responsible for

mortgage payments.” The parties also agreed that plaintiff “shall be allowed to reside

in home at [the Panorama Drive property] and be responsible for utilities, general

maintenance, keeping the house clean and in market ready condition” until the date

of sale.

       On 25 June 2008, four months after the parties executed the separation

agreement, plaintiff refinanced the existing mortgage on the Panorama Drive

property to pay off the parties’ marital debts. Plaintiff filed a complaint seeking an

absolute divorce and equitable distribution on 18 July 2011. Defendant filed an

answer and a counterclaim for equitable distribution. The trial court addressed the

issue of equitable distribution in three separate orders; collectively serving as the

trial court’s equitable distribution judgment.

       On 2 March 2012, the trial court entered an order for partial settlement for

equitable distribution, in which the parties agreed to list the Panorama Drive

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                                    Opinion of the Court

property for sale and specifically set out that plaintiff agreed “to complete the staining

of the deck, paint[] the hallway and pressure wash of the deck and other small

repairs” in exchange for defendant’s agreement “to make stain and paint available

for the above repairs.”

       On 10 July 2012, the trial court entered a consent judgment for equitable

distribution, in which the parties agreed to list the Panorama Drive property.

Defendant also agreed to pay plaintiff $22,500, which “shall be paid first after the

payment of the ordinary expenses of sale of real estate from the proceeds of the sale

of the Panorama [Drive] property.           The subsequent percentage division of the

proceeds of the Panorama [Drive] property remains undecided by the parties and

shall be an issue for the [trial c]ourt.”

       On 1 October 2012, the trial court entered a judgment and order for equitable

distribution. The parties “had agreed that each would pay one-half of the mortgage[]

on [the Panorama Drive property]” and the trial court ordered them to split the

proceeds upon sale of the Panorama Drive property after payment of reasonable

expenses––“[p]laintiff [will] receiv[e] 47% of the proceeds and [d]efendant [will]

receiv[e] 53% of the proceeds[.] . . . [T]his result in part is based on the fact that the

parties have agreed that [d]efendant can list the property as a realtor and will receive

at least 3% for the sale price.”      The trial court permitted defendant, who had

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                                  SLUDER V. SLUDER

                                   Opinion of the Court

experience in the real estate business, to handle the sale of the Panorama Drive

property, which included the sole discretion of setting the sale price.

      In early 2017, the parties were in dispute involving the sale of the Panorama

Drive property, and the trial court issued an order on 18 April 2017 allowing

defendant and her mother to purchase the property. The contract was signed by the

parties in May 2017. Defendant took possession of the property and paid one-half of

the mortgage payments until September 2017. Although defendant had stopped

making mortgage payments, she continued to reside at the property.

      A hearing was held before the trial court on 23 January 2018 to address

whether the refinanced mortgage should be designated as a separate debt of plaintiff.

On 20 March 2018, the trial court issued an “Order In the Cause” and concluded that

“the refinanced debt on the Panorama Drive property was the refinance of a marital

debt[,]” and therefore, was not a separate debt of plaintiff. Defendant appeals.

           _________________________________________________________

      On appeal, defendant argues the trial court erred by ordering that plaintiff and

defendant are equally responsible for payment of the mortgage where plaintiff

refinanced the existing mortgage after date of separation. We disagree.

             Equitable distribution is vested in the discretion of the trial
             court and will not be disturbed absent a clear abuse of that
             discretion.   Only a finding that the judgment was
             unsupported by reason and could not have been a result of
             competent inquiry, or a finding that the trial judge failed
             to comply with the statute, will establish an abuse of

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                                   Opinion of the Court

             discretion.

Wiencek-Adams v. Adams, 331 N.C. 688, 691, 417 S.E.2d 449, 451 (1992) (citations

omitted). “Under N.C.G.S. § 50-20(c), equitable distribution is a three-step process;

the trial court must (1) determine what is marital [and divisible] property; (2) find

the net value of the property; and (3) make an equitable distribution of that property.”

Robinson v. Robinson, 210 N.C. App. 319, 322, 707 S.E.2d 785, 789 (2011) (internal

quotation marks and citation omitted).

             We have stated that “[t]he standard of review on appeal
             from a judgment entered after a non-jury trial is whether
             there is competent evidence to support the trial court’s
             findings of fact and whether the findings support the
             conclusions of law and ensuing judgment. The trial court’s
             findings of fact are binding on appeal as long as competent
             evidence supports them, despite the existence of evidence
             to the contrary.”

Johnson v. Johnson, 230 N.C. App. 280, 282, 750 S.E.2d 25, 27 (2013) (quoting Peltzer

v. Peltzer, 222 N.C. App. 784, 786, 732 S.E.2d 357, 359 (2012)).

      In the instant case, the trial court’s Order In the Cause, in relevant part, makes

the following unchallenged findings of fact:

             15.    On June 25, 2008, [p]laintiff refinanced the
             mortgage identified in the Separation Agreement which
             had a balance of $207,780.21. He took the mortgage out in
             his name alone. In addition, enough money was borrowed
             to pay some existing debt[s] to writ; an Advanta credit card
             in the amount of $14,264.31, a Countrywide equity line in
             the amount of $17,152.66 and a Lowes credit card in the
             amount of $1,309.05.

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                                  SLUDER V. SLUDER

                                   Opinion of the Court

             ....

             20.    Both parties[’] ED Affidavit also listed as the same
             marital debt, debts to Advanta, P.O. Box 31032, Tampa, FL
             3363, both affidavits carried a notion that the Advanta debt
             was paid off in the refinance of [the] Panorama Drive
             property in 2008 in the amount of $14,264.31. Also paid off
             in the refinance of 2008 was a Countrywide loan in the
             amount of $17,152.66.

             ....

             38.     While it is arguable that the parties could have
             chosen to litigate whether the refinanced mortgage on the
             Panorama Drive property became the separate debt of
             [p]laintiff, the parties did not litigate that matter. That the
             [trial c]ourt’s ED Judgment on 10/1/12 does not designate
             the refinanced mortgage debt as a separate debt of
             [p]laintiff.

             39.    That based on the competent and credible evidence
             presented at the time of the hearings that resulted in the
             ED Judgment of 10/1/12, the [trial c]ourt was aware of the
             debt on the Panorama Drive property and that the [trial
             c]ourt was able to consider said debt in determining an
             equitable distribution of the estate.

             40.    That the [trial c]ourt was also aware, at the time of
             the entry of the ED Judgment of 10/1/12, that the debt on
             the Panorama Drive property was the refinance of the
             previous debt on the property and that this was both
             marital property and marital debt and that the Panorama
             Drive property could not be sold without the payment of
             the lien. . . .

The trial court then concluded, inter alia, “[t]hat the refinanced debt on the Panorama

Drive property was the refinance of a marital debt.”

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                                   SLUDER V. SLUDER

                                    Opinion of the Court

      We agree with the trial court’s conclusion.           This Court has previously

recognized that “any debt incurred by one or both of the spouses after the date of

separation to pay off a marital debt existing on the date of separation is properly

classified as a marital debt.” Huguelet v. Huguelet, 113 N.C. App. 533, 536, 439
S.E.2d 208, 210 (1994). Additionally, while defendant contends that the refinanced

mortgage was a separate debt because it was in plaintiff’s name and it occurred after

date of separation, there was competent evidence to support that the parties also

agreed that the refinanced mortgage was marital debt.

      The record reveals that on 2 March 2012, the order for partial settlement on

equitable distribution was entered, with the consent of the parties and their

respective counsel, in which the parties agreed to “expressly waive[] the necessity for

the [trial c]ourt to make any detailed [f]indings of [f]act to identify, classify, value or

distribute a portion of their marital property and debts[.]” Prior to this order, the

parties separately submitted affidavits delineating their assets.         On defendant’s

affidavit, she certified that the Panorama Drive property was a marital asset and

that the refinanced mortgage of $250,000 was a marital debt.

      During the 23 January 2018 hearing, plaintiff stated that he refinanced the

parties’ existing mortgage due to high interest rates and because the parties could

not reach a decision on the property––“it was just [in] our best financial interest to

consolidate our existing four debts and then that way we had a payment to share till

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                                  SLUDER V. SLUDER

                                  Opinion of the Court

[sic] we got everything situated.” In fact, defendant acknowledged, during an earlier

equitable distribution hearing in 2012, that because she was under financial strain

before the property was listed for sale, “we refinanced” the property to get a lower

rate; presumably indicating that she agreed to the refinancing. Defendant stated

that her name was left off the refinanced mortgage because her “credit score was not

as good as [plaintiff’s credit score].” Therefore, defendant cannot now assert on

appeal that the refinanced mortgage should be considered separate debt when it was

incurred to pay off marital debt, and she agreed it was, in fact, marital debt.

      Accordingly, the trial court’s findings of fact are supported by the evidence in

the record, which in turn supported the trial court’s conclusion that the refinanced

mortgage was a marital debt. The trial court’s ruling is

      AFFIRMED.

      Judges DAVIS and INMAN concur.

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