Teeter v. Teeter

408 S.C. 485

759 S.E.2d 144

James Arthur TEETER, III, Appellant,

v. Debra M. TEETER, Respondent.Appellate Case No. 2012–212565.

No. 5203.

Court of Appeals of South Carolina.

Heard Dec. 11, 2013.

Decided March 5, 2014.

Withdrawn, Substituted and Refiled May 21, 2014.

Rehearing Denied June 25, 2014.

Jean P. Derrick, of Lexington, for Appellant.

C. Vance Stricklin, Jr., of Moore, Taylor & Thomas, P.A., of West Columbia, and Katherine Carruth Goode, of Winnsboro, for Respondent.

KONDUROS, J.

James Arthur Teeter, III (Husband) appeals the family court's rulings regarding the valuation and classification of property in this divorce action. He also argues the family court erred in excluding information obtained from the e-mail account of Debra Teeter (Wife) regarding her relationship with another man. We affirm as modified and remand.

FACTS/PROCEDURAL HISTORY

Husband and Wife married in November 1996.¹ At that time, Husband was employed as a stock broker for Prudential Securities. He owned several parcels of real estate including his residence, the Indian Creek property, and three rental properties. During the marriage, Husband changed employers and went to work for Legg Mason as a stock broker. He eventually founded his own investment firm, Apex Investment Advisors, LLC, in 2003. Wife became a certified fraud examiner during the marriage. At the time of the temporary hearing in May 2009, Husband claimed gross annual income of $71,000 and Wife claimed $78,756. At the time of the final hearing, in 2011, Husband claimed gross annual income of $116,000 and Wife claimed $97,000.² Husband and Wife always maintained separate checking accounts, and Husband put all his regular income, rental income, and proceeds from real estate transactions into his single account.

In 1998, Husband sold the Indian Creek property, and the parties bought their dream home (Bob White property). Husband generally made the mortgage payment on the property and paid for utilities and repairs, while Wife bought groceries and paid for childcare and other miscellaneous expenses. During the marriage, Husband purchased additional rental properties. The division of some of those properties is at issue on appeal, and the details of those transactions are set forth below. Generally, Husband claims he sold or mortgaged nonmarital rental properties for a portion of the newly acquired properties and borrowed the rest in the form of a mortgage on the properties, which were self-supporting.

The parties agreed that after the birth of their second child in 2001, they began to grow apart. After the parties separated in 2008, Husband suspected Wife was involved with another man. He testified he saw Wife's e-mail password written on a sheet of paper that was lying on top of her open purse while he was visiting the marital home to see the children. Husband also testified he installed spyware on Wife's computer but indicated it did not produce any relevant information, only a couple of “garbled” screen shots. Husband read some of Wife's e-mails, which revealed she had been in contact with a former colleague. In one series of e-mails from 2009, Wife attempted to convince the man to meet her in Myrtle Beach. Additionally, Wife admitted at trial she had lied to Husband about attending a class reunion in Nashville and instead went to see the former colleague in Arizona in 2010. Wife never admitted to committing adultery. Husband admitted to committing post-separation adultery.

The family court had previously granted the parties' divorce based on one year's continuous separation. With respect to equitable apportionment, the family court determined the division of marital assets should be 55%/45% in Husband's favor. The family court excluded evidence of Wife's e-mails and the evidence flowing therefrom on the basis that their interception violated the Electronic Communications Privacy Act. However, the family court emphasized that Wife's alleged adultery had no impact on its division of assets.

The family court determined the Glenn Street properties, rental properties purchased by Husband during the marriage, were marital property. The court further determined Husband's business was marital property and assigned it a value of $74,775.32 based upon a balance sheet prepared by Husband in 2011. The family court assigned equity of $12,600 to the Garner Lane property acquired by an LLC Husband created during the marriage to lease the property to Apex Investors. As part of the division of assets, the parties were to sell the Bob White property, where Wife had been living with the children since the parties separated. Wife was to pay 45% of the mortgage and Husband was to pay 55% until the property sold. Finally, the family court awarded Wife $15,000 in attorney's fees, reasoning Husband's dispute over the Glenn Street properties and his activities concerning Wife's e-mails had generated a large portion of Wife's attorney's fees. Husband's request for attorney's fees and private detective's fees was denied. This appeal followed.

STANDARD OF REVIEW

“In reviewing the decision of the family court, an appellate court has the authority to find the facts in accordance with its own view of the preponderance of the evidence.” S.C. Dep't of Soc. Servs. v. Sarah W., 402 S.C. 324, 333–34, 741 S.E.2d 739, 744 (2013). “While this [c]ourt retains its authority to make its own findings of fact, we recognize the superior position of the family court in making credibility determinations.” Id. at 334, 741 S.E.2d at 744. “Moreover, consistent with our constitutional authority for de novo review, an appellant is not relieved of his burden to demonstrate error in the family court's findings of fact.” Lewis v. Lewis, 392 S.C. 381, 392, 709 S.E.2d 650, 655 (2011). Therefore, “the family court's factual findings will be affirmed unless appellant satisfies this court that the preponderance of the evidence is against the finding of the [family] court.” Id. (internal quotation marks omitted).

LAW/ANALYSISI. Exclusion of Emails

Husband contends the family court erred in concluding he violated the Electronic Communications Privacy Act, 18 U.S.C.A. § 2515 (2000), based on a lack of credibility in his testimony that he accessed Wife's e-mails by means other than spyware.³ He further maintains the family court erred by interpreting the statute to preclude all the evidence of Wife's alleged adultery except the actual e-mails. We disagree.

The family court did not find Husband's testimony that he stumbled onto Wife's password to be credible. Husband admitted he installed spyware on Wife's computer for the purpose of monitoring her e-mails. The determination of credibility lies largely within the province of the family court. The record supports the family court's factual finding in light of Wife's testimony that she had not written down her password and would have left it in her planner at work had she done so. The only way Husband knew to investigate Wife's out-of-town trip was by accessing her e-mail account. Without further argument or testimony that Husband's installation of the spyware did not violate the Act, Husband has not demonstrated the family court erred by excluding all the evidence related to Wife's relationship with her former colleague. See Rickenbaker v. Rickenbaker, 290 N.C. 373, 226 S.E.2d 347, 352–53 (1976) (holding all evidence regarding the wife's adulterous conduct derived by the husband's interception of her phone calls inadmissible under the Act).

Even if the family court erred in excluding evidence of the relationship, the court explicitly stated in its order that neither Wife's conduct nor Husband's post-separation adultery were considered in the equitable division of assets. ⁴ The court determined Husband and Wife grew apart as a consequence of not communicating after the birth of their second child. While Wife's post-separation contact with her former colleague was not completely irrelevant, the family court determined it did not impact the break-up of the marriage nor deplete the marital assets. That is a finding well-within the family court's purview, and Husband has not met his burden of proving the family court erred.

II. Glenn Street Properties

Husband argues the family court erred in determining the Glenn Street properties, purchased or created during the marriage, were marital assets. We disagree.

Husband purchased 951 Glenn Street in 1998 for approximately $60,000. He testified he used $11,726 in proceeds from the sale of the Indian Creek property as a down payment. HUD statements support that Husband sold the Indian Creek property, received approximately $34,000 in proceeds, and purchased 951 Glenn Street two weeks later with an $11,726 down payment. Husband financed the remainder of the purchase price with a mortgage on the property, and the record shows 951 Glenn Street generated enough rent to cover the mortgage payments. Wife testified she did not know the source of the funding to buy 951 Glenn Street.

In March 2001, Husband mortgaged a nonmarital property (the Wellington property) and netted $29,524. Husband testified that in November 2001, he used those funds to subdivide 951 Glenn Street into two additional lots, 947 and 955, and make improvements to them. Husband made total improvements of $87,543 to the two new lots utilizing personal credit lines to pay for the remainder of the improvements. When the work was completed, Husband mortgaged 947 Glenn Street and 955 Glenn Street for $111,800. He paid off the credit lines with the mortgage loan and the rent generated covered the mortgage payments.

Generally, property acquired during a marriage is considered marital property regardless of how title is held. S.C.Code Ann. § 20–3–630(A) (Supp.2012). Two exceptions to this general rule include property acquired before the marriage or property acquired in exchange for nonmarital property. Id. “The burden to establish an exemption under section [20–3–630] is...