Facts: Before the parties married in 2000, they entered into a prenuptial agreement that provided as follows:
In the event of an Order of Divorce . . . each party shall be solely entitled to a return of his or her Separate Property and an equal division of the Marital Property . . . . The parties acknowledge that the provisions contained in this Agreement for the equal division of Marital Property after restoration to each party of his or her Separate Property shall constitute an acceptable property division . . . .
Elsewhere, the prenuptial agreement stated “it is the parties’ intention to return to the person contributing the Separate Property the value of his or her contribution before the division of the remainder of the marital asset.”
During the marriage, Wife purchased two homes with her separate assets–one home in New Mexico for $366,000 and one in Tennessee for $1.7 million–and jointly titled both properties. The total combined marital appreciation for both homes was $173,000. During the marriage, Wife spent from her separate assets a total of $142,00 for property taxes, insurance, and homeowner’s association dues for both homes. Wife paid Husband temporary support of $2600/month until the divorce was granted plus $10,000 for moving expenses with the stipulation that Wife would receive a credit against any amount Husband may be awarded in the divorce. By the time of divorce, Wife was entitled to a credit of $69,800.
The trial court found Wife’s payments for property taxes, insurance, and homeowner’s association should be deducted from the marital appreciation because they were contributions of her separate property. Thus, according to the trial court, the marital appreciation to be divided equally was $31,000, not the full $173,000 Husband was claiming. After crediting Wife for $69,800 paid in temporary support, the trial court found Husband was not entitled to any money whatsoever. Husband appealed.
The Court of Appeals affirmed the trial court.
Ms. Cummins argues that her payment of the taxes, insurance, and association fees were “contributions” of her separate property, the “value” of which is to be returned to her, relying on the language that “it is the parties’ intention to return to the person contributing the Separate Property the value of his or her contribution before the division of the remainder of the marital asset.”
Mr. Cummins seems to argue that Ms. Cummins’ acquisition costs alone constitute such contributions and that the other identified necessary expenses associated with the homes do not qualify as “contributions.”
Given the broad nature of the term “contribution,” the statement of intent in the agreement, and the purpose of the payments, we agree with the trial court that the enumerated expenses paid by Ms. Cummins, which were expenses necessary to retain ownership of the homes, are included within the term “contribution” as used in the parties’ agreement.
On appeal, Husband ended up with the same result: $0.00.
Information provided by K.O. Herston, Tennessee Divorce Lawyer.