Failure to Require Mortgage Debt Refinancing in Clarksville Divorce Reversed: Mobley v. Caffa-Mobley

Facts: The parties divorced after a 13 year marriage. As part of the equitable division of property, Wife was awarded a residence in Florida and was made solely responsible for the joint mortgage debt and other liabilities associated with the property. The trial court did not, however, require Wife to refinance the mortgage debt solely into her name. Husband appealed.

On Appeal: The Court of Appeals reversed the trial court.

Husband argued the trial court erred in failing to require Wife to release him from the mortgage on the Florida property within a reasonable amount of time.

Tennessee Code Annotated § 36-4-121(c)(4) requires the trial court to consider “the relative ability of each party for future acquisitions of capital assets” in its division and distribution of marital property.

The Court opined that the failure to make any provision for Husband’s release from the debt encumbering the Florida property “may be contrary to Tennessee law,” writing:

[P]ursuant to the Final Decree here, Husband remains indefinitely obligated to pay the outstanding debt and costs of collection if Wife defaults; further, the indefinite indebtedness impairs his ability to qualify for financing should he require a mortgage to obtain financing for housing or other needs in the future. Therefore, based upon the record before us, we have determined that a reasonable time frame should be established by which Wife is required to satisfy the indebtedness on the Florida property for which Husband is jointly and severally liable, either by selling the property and paying the entire indebtedness or by refinancing in a manner by which Husband shall be fully released from any liability on the indebtedness.

For the foregoing reasons, we remand with instructions for the trial court to determine a reasonable time by which Wife shall secure Husband’s full release on the indebtedness encumbering the Florida property.

K.O.’s Comment: The Court’s reasoning is consistent with its decision in Dobbs v. Dobbs.

Mobley v. Caffa-Mobley (Tennessee Court of Appeals, Middle Section, November 30, 2012).

Information provided by K.O. Herston: Knoxville, Tennessee Matrimonial, 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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