Luttrell v. Luttrell, No. W2012-02279-COA-R3-CV (Tenn. Ct. App. Jan. 28, 2014).
William and Beverly Luttrell had been married in 1987 in Mississippi. The spouse got here from a well-to-do household unit, since her grandfather had began Bryan Foods, which later grew to become a part of the Sara Lee Corporation. Prior to the wedding, she was the beneficiary of a belief with in preliminary worth of just about $600,000. Over the years, her household unit added presents of money and inventory with an extra worth of over half one million money. She stored these property in accounts titled in her title alone.
Shortly after getting married, they moved to Illinois, what place the husband earned his MBA from Northwestern University. While he was in graduate faculty, the spouse labored in a preschool till she grew to become pregnant in 1989. In 1990, the husband accepted a job with International Paper in Memphis, Tennessee. They had three extra kids, and due to the spouse’s wealth, she was in a position to be a stay-at-home mother.
They led a well-to-do way of life, and acquired a house in Germantown for $515,000 in 1996. The spouse used $290,000 of her funds for the down cost, whereas the husband’s earnings paid most of their dwelling bills.
After two years at International Paper, the husband began a job as product supervisor for Smith & Nephew, however left on account of a heavy journey schedule. In 2003, the husband determined to open an vintage retailer in Germantown. The spouse withdrew $94,000 to buy the property and begin the enterprise.
The enterprise didn’t do well, however regardless of the spouse’s urgings to hunt extra conventional employment, the husband continued with attempting to make a go of the vintage store. Eventually, he started searching for different employment and listed the vintage store property on the market. It was nonetheless available on the market on the time of trial.
In 2006, the spouse discovered that the husband was having an affair. She filed for divorce, however then tried reconciliation. But in 2011, the husband filed for divorce, and the spouse counterclaimed. The husband stayed within the marital house, and the spouse used $392,000 to purchase one other home in Germantown. The marital house was finally listed on the market, however had not but offered.
The events resolved many of the parenting points, however an answer to the property points eluded them. Trial was held in Shelby County in 2012 earlier than Judge Robert L. Childers. The court docket granted the spouse an absolute divorce on the grounds of inappropriate marital conduct. After the court docket divided the property, there was an appeal to the Tennessee Court of Appeals through which each events made arguments.
The most contentious concern was the standing of the spouse’s belief accounts, which had a worth of over $1.7 million. The spouse argued that this was her separate property, however the husband asserted that the asset had been transmuted into marital property. He argued that the proof confirmed that the events had treated the belief as marital property by the years. He first famous that he had actively participated within the administration of the investments, had attended conferences with bankers, and had communicated straight with them. He additionally identified occasions when the spouse had referred to the funds as “ours” and used the phrase “we” in relation to them.
But the court docket examined the proof and concluded that the spouse by no means meant to relinquish management over the funding accounts. For instance, the belief officer testified that he had communicated with the husband, however that he at all times checked with the spouse for approval earlier than taking any motion. In addition, the belief officer testified that he by no means acted on the husband’s funding recommendation. The accounts had been at all times titled in her title alone.
The court docket additionally famous that the husband had borrowed cash from his mom to buy stock for the vintage retailer, one thing that may have been pointless if he had entry to the finds.
The husband subsequent argued that the funding accounts had been commingled with marital property. But the court docket concluded that there was no proof to help this declare.
Finally, the husband argued that the appreciation of the belief was marital property. But the court docket famous that the spouse’s contributions to the marital property over time had tremendously exceeded that of her husband. Even if the husband’s actions brought about a number of the appreciation, this was greater than offset by the advantages he had acquired, such because the spouse utilizing belief property to repay his scholar loans.
The Court of Appeals thought-about quite a lot of different points, however discovered that the trial court docket needs to be affirmed on these points as well. Therefore, the Court of Appeals affirmed.
This publish is a part of a collection, Appreciation of Separate Property: The Forensic Accountant’s Full Employment Act.