Bowman v. Bowman

332 So.3d 317

David Eugene BOWMAN, Appellant

v.Robin Sills BOWMAN, Appellee

NO. 2020-CA-00183-COA

Court of Appeals of Mississippi.

August 5, 2021

Rehearing Denied November 2, 2021

ATTORNEY FOR APPELLANT: NATALIE J. GIDEON

ATTORNEY FOR APPELLEE: S. CHRISTOPHER FARRIS, Hattiesburg

EN BANC.

WILSON, P.J., FOR THE COURT:

¶1. David Bowman and Robin Sills were married in February 2012. At the time of their marriage, David was 48 years old and had separate assets with a value of approximately $3,188,456. He was disabled but received income from disability insurance and other sources. Robin was 46 years old and had separate assets with a value of approximately $1,378,000. She worked as an attorney prior to and throughout the marriage with an annual salary of approximately $92,000. The parties signed an antenuptial agreement shortly before they were married. Prior to their marriage, the parties had started a business, Rainbow Ventures LLC, to "flip" houses. Each party was a fifty percent owner of the LLC.

¶2. The parties separated in August 2015, and in October 2015 Robin filed a complaint for a divorce. In January 2016, the chancellor entered a temporary order. In August 2017, the chancellor appointed the Koerber Company P.A. to serve as a forensic accounting expert for the court. In November 2018, the parties filed a joint consent to an irreconcilable differences divorce. They agreed to submit the equitable division of the marital estate to the chancellor for a decision. The case proceeded to trial in June 2019.

¶3. In December 2019, the chancellor entered a final opinion and judgment. The chancellor applied the parties’ antenuptial agreement, classified their assets and liabilities as marital or nonmarital, and then divided the marital estate. The chancellor awarded David marital assets with a value of $318,213.53 and awarded Robin marital assets with a value of $248,313.53. There were no marital debts. David subsequently filed a motion to alter or amend the judgment, which was denied, and a notice of appeal.

¶4. On appeal, David argues that the chancellor (1) misinterpreted the antenuptial agreement and erred in classifying assets as marital or nonmarital; (2) failed to analyze the Ferguson¹ factors; (3) made a clearly erroneous finding of fact regarding the parties’ respective contributions to their joint bank accounts; (4) erred by refusing to award David interest on a loan he made to Robin during the parties’ marriage; and (5) erred in failing to establish a value or a date for valuing a car that was a marital asset. We address these issues below, providing additional facts as necessary. We find no reversible error as to issues (1), (2), (4), or (5), but we do conclude that the chancellor made clearly erroneous findings of fact regarding the parties’ respective contributions to their joint bank accounts. Those findings may have impacted the chancellor's Ferguson analysis. Therefore, we reverse and remand for the chancellor to determine whether correction of the error warrants a different division of the bank accounts or any other marital asset.

ANALYSIS

I. The chancellor correctly concluded that the parties’ antenuptial agreement is ambiguous, and the chancellor's resolution of the ambiguity is supported by substantial evidence.

¶5. An antenuptial agreement is a contract and should be interpreted just like any other contract. Smith v. Smith , 656 So. 2d 1143, 1147 (Miss. 1995). Contract interpretation involves "a two-step inquiry." Royer Homes of Miss. Inc. v. Chandeleur Homes Inc. , 857 So. 2d 748, 751 (¶7) (Miss. 2003). First, the court must "determine whether a contract is ambiguous and, if not, enforce the contract as written." Id. Whether the contract is ambiguous is a question of law that we review de novo. Id. Second, "[i]n the event of an ambiguity, the subsequent interpretation presents a question of fact for the [fact-finder] which we review under a substantial evidence/manifest error standard." Id. at (¶8). "If the terms of a contract are subject to more than one reasonable interpretation," their meaning presents a question of fact for the fact-finder. Id.

¶6. "[The Mississippi Supreme] Court has set out a three-tiered approach to contract interpretation." Id. at (¶10). First, we attempt to determine the "[l]egal purpose or intent" of the contract based solely on the "four corners" of the contract—that is, based on "an objective reading of the words employed in the contract to the exclusion of parol or extrinsic evidence." Id. If the language of the contract is clear and unambiguous, it must be enforced as written. Id. at 752-53 (¶10). Second, if the terms of the contract are ambiguous, "the court should apply the discretionary ‘canons’ of contract construction." Id. at 753 (¶11). Third, only if traditional canons of construction do not resolve the ambiguity, "the court should consider extrinsic or parol evidence" of the parties’ intent. Id.

¶7. As relevant in this appeal, the parties’ antenuptial agreement states, "Each party desires to keep all of his or her nonmarital property, whether now owned or hereafter acquired from whatsoever source, free from any claim of the other arising from their forthcoming marriage, unless specifically treated otherwise [in the agreement]." Schedules to the agreement list the parties’ respective nonmarital assets at the time of the marriage. In addition, section 2(b) of the agreement stated that any property "acquired in exchange for property listed on [those schedules]" would also be "considered nonmarital." Section 3 states in part that the parties "specifically reject the concept of unintentional transmutation of nonmarital property into marital property by commingling such property." Next, section 4 of the agreement specifically addresses the status of property acquired during the marriage and titled in one spouse's name or titled jointly. In relevant part, section 4 states:

All property, including but not limited to, realty, money accounts, investments, professional holdings, business interests and professional partnership assets, acquired by either party after their marriage shall be nonmarital property if the asset is one that traditionally titled, e.g., realty, vehicles, boats, etc., and is separately titled in one of the parties’ individual names. If such property is jointly titled, it shall be deemed marital.

Finally, section 9 of the agreement states in relevant part that "the presumption ... under Mississippi common law ... that all property acquired by either party during the marriage is marital property, shall not apply; and ... that the doctrine that nonmarital property may become marital property by commingling shall not apply."

¶8. These provisions of the parties’ antenuptial agreement are relevant to certain assets acquired by the parties during their marriage, including most notably three disputed properties that they acquired as part of their house-flipping business—referred to by the parties and the chancellor as 42 Bridgewater, 35 Clipper Drive, and 101 North 22nd Avenue. Those properties were acquired by the parties during the marriage with David's separate funds but then jointly titled in the names of both parties. The chancellor classified those properties as marital property and then equitably divided them. David argues that the chancellor erred because the properties are considered nonmarital property under section 2(b) of the antenuptial agreement.

¶9. In his opinion, the chancellor concluded that the above-quoted provisions of the antenuptial agreement were "contradicting" but also held that the agreement as a whole was enforceable and would "govern the distribution of property." Although the chancellor did not specifically say that the terms were "ambiguous," his determination that they are contradictory is tantamount to a finding of ambiguity. See Dalton v. Cellular S. Inc. , 20 So. 3d 1227, 1233 (¶¶11-12) (Miss. 2009). Furthermore, the chancellor did not err by holding that the terms of the contract—in particular, sections 2(b) and 4—are contradictory and ambiguous in how they apply to the disputed properties. Both section 2(b) and section 4 apply to property that the parties acquired during their marriage. Section 2(b) provides that property acquired during the marriage "in exchange for [nonmarital] property" will also be "considered nonmarital." Section 4 then provides that certain types of property—including realty—acquired during the marriage "shall be deemed marital" if the property is "jointly titled." The ambiguity arises with respect to property that was both acquired "in exchange for [nonmarital] property" and "jointly titled." The agreement is ambiguous with respect to whether such property should be considered nonmarital or marital.

¶10. It is evident that the chancellor concluded that section 4 was controlling with respect to such property. The chancellor reasoned that under section 4, "property acquired during the marriage that is jointly-titled shall be deemed marital property, regardless of how acquired ." (Emphasis added). In addition, the chancellor ruled that "per the antenuptial agreement," 42 Bridgewater, 35 Clipper Drive, and 101 North 22nd Avenue were all "marital property" because they were all acquired "during the marriage" and "jointly titled to the parties." This was so even though the parties used David's separate funds to purchase the three properties.

¶11. Because the chancellor properly determined that the relevant provisions of the antenuptial agreement were conflicting and ambiguous, his subsequent interpretation of those provisions "presents a question of fact ... which we review under a substantial evidence/manifest error standard."

Royer Homes , 857 So. 2d at 752 (¶8). As noted above, a "court should apply the discretionary ‘canons’ of contract construction" to resolve an ambiguity in a contract. Id. at 753 (¶11). One such canon is that when "the language of an otherwise enforceable contract is subject to more...