Facts: After 28 years of marriage, Wife filed for divorce. Husband and Wife owned a piece of property with unrelated Third Party. A few months after the divorce was filed, Husband transferred his interest in the property to his sister and brother-in-law.
Third Party then filed a partition action that named Husband and Wife as co-owners of the partition property.
A few months later, Wife filed a petition for criminal contempt in the divorce action alleging that Husband transferred his interest in the partition property without Wife’s consent. Wife requested that she be awarded the proceeds from the sale of the partition property.
The parties then reached an agreement in the divorce proceeding as to the equitable division of the marital estate. The agreement awarded specific assets to Wife and awarded the “balance of the parties’ assets not specifically mentioned herein” to Husband. It did not specifically mention to partition property by name. It also dismissed Wife’s pending contempt petition. The trial court entered the final decree of divorce that incorporated the parties’ agreement.
Husband was subsequently dismissed from the partition action because he claimed he had no interest in the partition property. The court ordered that the partition property be auctioned and set another hearing to to determine how the proceeds would be distributed.
Husband then sought to set aside the final decree of divorce on the grounds that Wife was asserting — in the partition action — an interest in the partition property that Husband claimed was awarded to him. After a hearing on Husband’s motion, the trial court found:
That [Husband] deliberately violated Tennessee Code Annotated § 36-4-106 and that he comes to the court with unclean hands and therefore, the court does not find that he is entitled to relief from the original judgment. . . . The court further found that there was no ambiguity in the orders and that proceeds from the [partition] property was [Wife's] separate property and was not marital property. The court further found that when he transferred his interest in the property to [his sister and brother-in-law] he committed a contemptible charge based upon statute and would not be permitted to come back and claim an interest in that property. The court finds that he has waived any interest he would have and does not petition the court with clean hands.
On Appeal: The Court of Appeals affirmed the trial court.
Tennessee Code Annotated § 36-4-106(d) lists several temporary injunctions which commence upon the filing of a complaint for divorce including the following:
(1)(A) An injunction restraining and enjoining both parties from transferring, assigning, borrowing against, concealing or in any way dissipating or disposing, without the consent of the other party or an order of the court, of any marital property. Nothing herein is intended to preclude either of the parties from seeking broader injunctive relief from the court.
The doctrine of “unclean hands” is a tenet of courts of equity based on the principles that “he who seeks equity must do equity and that he who has done inequity cannot have equity.” The doctrine enables a court to prevent a party from profiting from her own misconduct. Decisions regarding the proper application of the doctrine of unclean hands are heavily fact-dependent and are addressed to the considerable discretion of the trial court.
After reviewing the record, the Court reasoned:
Because Husband transferred the [partition] property in violation of Tennessee Code Annotated § 36-4-106(d), the trial court did not abuse its discretion in finding the unclean hands doctrine should prevent Husband from asserting an interest in the property under the catch-all provision of the final decree of divorce. The court did not err in awarding any proceeds realized from the partition action to Wife.
In other words, Husband cannot have it both ways. Because Husband committed contempt of court by transferring his interest in the partition property in violation of the statutory injunction, and because he later claimed he no longer had an interest in the partition property, he was not allowed to come back and change his position to assert that he (really, really this time!) had an interest in the property.
The trial court was affirmed.
Information provided by K.O. Herston: Knoxville, Tennessee Divorce, Matrimonial and Family Law Attorney.