Equitable Division of Property and Alimony: Phelps v. Phelps

Facts: After a 19 year marriage, Husband and Wife were divorced. After Husband’s father died in 1997, Husband began exhibiting signs of mental illness.

Husband began showing symptoms of obsessive-compulsive disorder. According to his own appellate brief, he “felt the need for the home to be spotless and germ-free for [the child] and himself. He began to go overboard with germ issues and would wash his hands until they bleed.” Other bizarre behavior included not allowing other children to play with the child or touch her toys, waking her up at two or three in the morning to shower because she was not clean enough, and discussing his death with her, asking how she would feel if he were dead. . . .

Husband’s worsening mental illness took a toll on the parties’ marriage. Things apparently came to a head in December 2008. Wife had previously talked to Husband about leaving him, and he had consistently responded by saying that he would kill himself if she left.

On December 16, 2008, Wife told Husband she wanted a divorce. The following morning, Husband, who was still employed by the Maury County Sheriff’s Department, carried a handgun as he walked through the kitchen of the parties’ home, where the minor child was having breakfast. He went out into backyard, held the gun to his head, and threatened to kill himself. The SWAT team was called, and after about 45 minutes they were able to talk him into putting the gun down. He was taken to the hospital and transferred for psychiatric treatment.

After a trial, the trial court divided the marital assets and debt. The most important component of the property division was the trial court’s award to Wife of the marital home. The court awarded Husband’s share of the equity in the marital home to Wife in the form of alimony in solido. When all was said and done, the trial court awarded Wife assets valued at $193,221.87 (88%) while Husband received assets valued at $25,225 (12%).

Husband filed a post-trial Motion to Alter or Amend Judgment, which focused on the propriety of the alimony in solido award. The trial court denied the motion, stating that even if an award of alimony in solido was not appropriate, the factors governing the equitable division of marital property would still weigh in favor of awarding Wife all the equity in the marital home, free from any claim by Husband. Husband appealed.

On Appeal: The Court of Appeals affirmed but modified the trial court’s ruling.

When dividing the marital estate, the trial court’s task is to make an equitable, or fair, distribution of property. The trial court is empowered to do what is reasonable under the circumstances and has broad discretion in the equitable division of the marital estate. Although Tennessee Code Annotated § 36-4-121(a)(1) requires the court to order an equitable division of marital property, an equitable division is not necessarily an equal division.

Because the division of marital property is not a mechanical process, and because decisions regarding the division of marital property are fact-specific and many circumstances surrounding the marital estate and the parties play a role, a trial court has a great deal of discretion concerning the manner in which it divides marital property.

Although the existence of a long-term marriage supports a presumption that the marital assets should be equally divided, that presumption can be overcome by countervailing considerations. In this case, the main countervailing consideration was relative contribution of the parties to the acquisition and preservation of marital property.

Wife [] had to serve not only as the family’s main breadwinner, but also as the primary parent. In light of her testimony as to periods of time when Husband was unable to get out of bed or off the couch, it is likely that she functioned as the primary homemaker as well. . . .

We can find no error in the trial court’s determination that Wife’s contribution to the acquisition and preservation of the marital property far exceeded Husband’s and that it justified awarding a far larger share of that property to her than to Husband on that determination.

In contrast to “the contribution of each party, . . .” which is a retrospective factor, many of the other statutory factors for division of marital property are prospective. That is, they look at the relative positions of the parties after divorce, including their mental and physical conditions and their ability to support themselves without the assistance of the other spouse. If these factors were considered in isolation, then Husband would likely be entitled to a greater share of the marital estate than he was awarded.

Wife has the greater need for the home since she is raising the parties’ child there, and she is in a far better position than Husband to pay the mortgage and the other household expenses. Husband does not argue that he should have been awarded the home instead of Wife, but he suggests that the trial court should have adjusted the division of marital property somehow, so he could receive an equal share of the marital assets. However, the marital home was the most valuable asset in the marital estate by far, worth more than all the other assets combined. To even come close to equalizing the property division, the trial court would have had to order Wife to either sell the only home the minor child has ever known, or incur substantial debt, thereby greatly increasing her financial burden. In its Final Order, the court declared that such a solution “would not only be inequitable, but unconscionable. . . .”

The trial court awarded Husband’s portion of the equity in the marital home to Wife as alimony in solido. Husband argued it was error to award any form of alimony to Wife, since he was the economically disadvantaged spouse, and he has the greater need, while Wife has the greater ability to pay. The Court of Appeals agreed. So what did Husband get for his successful argument? A moral victory. The Court concluded the equity in the home should have been awarded to Wife as property division, not alimony in solido, stating:

The most equitable division is one which leaves the marital home to Wife, free of any claims by Husband, but subject to a mortgage for which she assumes full responsibility, with Wife also assuming all responsibility for the other marital debts.

We thus affirm the award of the marital home and all the equity in it to Wife, but we modify the trial court’s judgment by making that award part of the division of marital property rather than a separate award of alimony.

Phelps v. Phelps (Tennessee Court of Appeals, Middle Section, June 24, 2011).

Information provided by K.O. Herston: Knoxville, Tennessee Divorce And Family Law Attorney.

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K.O. Herston is a family-law attorney in Knoxville, Tennessee whose practice is devoted exclusively to family law, including divorce, child custody, child support, alimony, prenuptial agreements, and other aspects of family law.

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