Smith v. Smith

379 So.3d 954

Jessy N. SMITH, Appellant

v.Christopher R. SMITH, Appellee

NO. 2022-CA-00183-COA

Court of Appeals of Mississippi.

02/13/2024

LAUDERDALE COUNTY CHANCERY COURT, HON. LAWRENCE PRIMEAUX, JUDGE

ATTORNEY FOR APPELLANT: MATTHEW ALLEN BALDRIDGE, Madison

ATTORNEY FOR APPELLEE: KATHRYN RAE McNAIR

BEFORE WILSON, P.J., McDONALD AND LAWRENCE, JJ.

WILSON, P.J., FOR THE COURT:

¶1. In this divorce case, Jessy Smith appeals from the final judgment awarding custody of her two children to her ex-husband, Christopher Smith ("Smitty"), and dividing the marital estate. Jessy argues that the chancellor erred by granting custody to Smitty, by awarding her too little visitation, and by finding that businesses that Smitty started during the marriage were Smitty’s separate property. We conclude that the chancellor did not err or abuse his discretion in awarding custody or visitation but erred by classifying one business as Smitty’s separate property. Therefore, we affirm in part, reverse in part, and remand the case for further proceedings consistent with this opinion.

FACTS AND PROCEDURAL HISTORY

¶2. Smitty and Jessy married in 2007. They had two children during their marriage, a boy born in 2012 and a girl born in 2015. During the marriage, Smitty owned and operated two businesses, which are discussed below. Jessy primarily worked as a nurse at Anderson Regional Medical Center in Meridian. The parties agree that they "separated" around September 1, 2019, although both continued to live in the marital home. In October 2019, Jessy filed a complaint for divorce based on alleged habitual cruel and inhuman treatment or, in the alternative, irreconcilable differences. Smitty filed a counterclaim for divorce based on adultery or, in the alternative, irreconcilable differences. Jessy moved out of the marital home around November 1, 2019, and began a romantic relationship with another man about one month later.

Child Custody and Visitation

¶3. Following a temporary hearing, the chancellor granted the parties temporary joint legal and physical custody of the children. At trial, the parties submitted hundreds of text messages between the two of them from before their separation and during the temporary joint custody period. The chancellor found that "[a]s with every other married couple with children, the text messages show agreements and disagreements, conflict and consensus, discussion and dictation, and affection and loathing." However, the chancellor also noted that the text messages "illustrate … how both parties failed utterly in the exercise of temporary joint legal custody."

¶4. During trial, Jessy accused Smitty of being controlling and manipulative and failing to be attentive to the children’s needs. Jessy also testified that Smitty threatened to take the children away from her if she divorced him. Smitty claimed that Jessy was selfish and not devoted to the children, stating, among other things, that she gave up some of her custodial time with the children and did not attend their school activities or sports events.

¶5. The chancellor determined from the testimony and evidence that Jessy initially "took primary responsibility for the day-to-day care of the children while Smitty worked hard to develop his business." However, "[i]n 2018, Jessy began working out at a gym and taking more time away from the children to devote time to herself and outside interests, leaving Smitty to be [children’s] primary caretaker up to the time of separation."

¶6. While both parties complained that joint custody was difficult, the chancellor found "that both parents love and are devoted to their children," and this was "a case in which there are two fit parents, each jockeying for advantage over the other." The chancellor also found that Jessy made "unsubstantiated and untrue allegations" that "undercut [her] credibility and [made] the court question how many other of her assertions [were] untrue or exaggerated."

¶7. The chancellor found that a majority of the Albright factors were neutral.¹ With respect to the "home, school, and community record" factor, the chancellor found that it would be in the children’s best interest to remain in the marital home because they had grown up there, and a number of their relatives lived nearby.

¶8. The chancellor noted that he "considered joint physical custody and would have liked to see it." However, the chancellor ultimately determined that neither joint legal custody nor joint physical custody was workable between Jessy and Smitty. The chancellor found that Smitty strongly opposed joint custody and that the temporary joint custody arrangement had not worked well.

¶9. In 2022, the chancellor entered a final judgment, awarding physical and legal custody to Smitty. Jessy was awarded visitation the first, third, and fifth weekends of each month; two Wednesday evenings per month; holidays; and the month of July each summer.

Property Division

¶10. Prior to his marriage to Jessy, Smitty’s father conveyed a parcel of land to Smitty. The property was located near land owned by several of Smitty’s relatives, and Smitty planned to build a home there. In 2006, Smitty obtained construction loans for the property in his name. In 2008, after the parties were married, they executed a warranty deed making Jessy and Smitty joint tenants with rights of survivorship.

¶11. In 1995, Smitty formed a landscaping business, now known as Horticulture Services LLC. Smitty continued operating the business throughout the parties’ marriage. In 2010, Smitty purchased property to start a second business, Midway RV and Boat Storage LLC, which he also operated throughout the marriage.

¶12. In the final judgment, the chancellor assessed a single valuation for "both existing businesses together." Jessy urged the chancellor to use an income-based approach, but the chancellor found that an asset-based approach was more appropriate because it excluded goodwill and because the evidence was insufficient to establish an income-based valuation. The chancellor further noted that he did not use the values Jessy provided because she valued items based on their cost rather than their fair market value.

¶13. The chancellor found that both Horticulture Services and Midway were Smitty’s separate property and thus were not subject to equitable division. In determining that the businesses were Smitty’s separate property, the chancellor noted that Jessy did not work in or help build either business and that she was not obligated on any business loans. The chancellor further indicated that Smitty kept the businesses’ banking separate from his personal accounts. There was also testimony that Smitty sometimes used one business’s accounts for the other business’s expenses or for personal and family expenses. However, the chancellor found "no evidence of commingling that would justify classifying the businesses as marital."

¶14. After applying the Ferguson factors,² the chancellor determined Smitty was entitled to the exclusive use, ownership, and possession of the marital home, with Jessy to be paid for her share of the equity.

Procedural History

¶15. In March 2021, the chancellor granted Smitty a divorce based on Jessy’s admitted and uncondoned adultery.³ After a five-day trial in August and December 2021, the chancellor issued an opinion and judgment granting physical and legal custody of the parties’ two children to Smitty, granting visitation to Jessy, and dividing the marital estate. Jessy filed a motion to alter or amend the judgment or for a new trial, which was denied in relevant part, and a notice of appeal.

ANALYSIS

¶16. On appeal, Jessy argues that the chancellor erred (1) by granting Smitty physical and legal custody; (2) by refusing to grant joint legal custody; (3) by granting her inadequate visitation; (4) in finding that Smitty’s businesses were his separate property; (5) by assessing a combined value for Smitty’s two businesses; (6) by us- ing an asset-based approach to value the businesses; and (7) by denying her motion to alter or amend the judgment or for a new trial.

I. Custody

¶17. Jessy argues the chancellor erred by granting Smitty physical and legal custody of their children and by refusing to grant joint legal custody. Specifically, Jessy argues the chancellor abused his discretion in finding that two Albright factors—the "stability of home environment and employment of each parent" and the "willingness and capacity to provide primary child care," Albright, 437 So. 2d at 1005—did not favor her. Jessy also argues the chancellor erred in finding that the children’s "home, school and community record" (id.) favored Smitty.

[1–3] ¶18. "A chancellor’s custody decision will be reversed only if it was manifestly wrong or clearly erroneous, or if the chancellor applied an erroneous legal standard." Smith v. Smith, 97 So. 3d 43, 46 (¶7) (Miss. 2012). "[T]his Court cannot reweigh the evidence and must defer to the chancellor’s findings of the facts, so long as they are supported by substantial evidence." Hall v. Hall, 134 So. 3d 822, 828 (¶21) (Miss. Ct. App. 2014). "[T]he issue is not whether this Court ‘agrees with the chancellor’s ruling,’ but only whether ‘the chancellor’s ruling is supported by credible evidence.’ " Sandern v. Sanders, 281 So. 3d 1043, 1049-50 (¶21) (Miss. Ct. App. 2019) (quoting Hammers v. Hammers, 890 So. 2d 944, 950 (¶14) (Miss. Ct. App. 2004)).

[4, 5] ¶19. "[T]he polestar consideration in child custody cases is the best interest and welfare of the child." Albright, 437 So. 2d at 1005. In determining what custodial arrangement is in a child’s best interest, the chancellor should consider the totality of the relevant circumstances, including the following factors: (1) age, health, and sex of the child; (2) "continuity of care prior to the separation"; (3) "parenting skills" of the respective parents; (4) the parents’ "willingness and capacity to provide primary child care"; (5) the parents’ respective employments...