Donna Lynn Lund v. John Fredrik Lund ( 2011 )

IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
August 16, 2011 Session
DONNA LYNN LUND v. JOHN FREDRIK LUND
Appeal from the General Sessions Court for Loudon County
No. 9792 William H. Russell, Judge
No. E2010-01727-COA-R3-CV-FILED-NOVEMBER 16, 2011
This is the second appeal of this post-divorce case to this court. Donna Lynn Lund (“Wife”)
and John Fredrik Lund (“Husband”) were divorced in 2008. In the first appeal of the trial
court’s classification of marital property, this court held that the increase in value of
Husband’s pre-marital annuity was separate property. On remand, the trial court divided the
property as consistent with this court’s opinion. Wife filed post-judgment motions and a
subsequent motion for Rule 60.02 relief, asserting that the order on remand contained errors
of law and that she mistakenly failed to file a timely notice of appeal. The trial court denied
the Rule 60.02 motion. Wife appeals. We affirm the decision of the trial court.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Sessions Court
Affirmed; Case Remanded
J OHN W. M CC LARTY, J., delivered the opinion of the court, in which H ERSCHEL P. F RANKS,
P.J., and D. M ICHAEL S WINEY, J., joined.
Ben H. Houston, Knoxville, Tennessee, for the appellant, Donna Lynn Lund.
Kimberlee A. Waterhouse, Lenoir City, Tennessee, for the appellee, John Fredrik Lund.
OPINION
I. BACKGROUND
Following Wife’s complaint for divorce, the parties agreed that grounds for divorce
existed but disagreed regarding the classification and division of the marital property. This
appeal concerns the division of Husband’s annuity that he received while working for the
Tennessee Valley Authority (“TVA”); thus, we will only discuss the division of that property.
The trial court initially classified the pre-marital TVA annuity as Husband’s separate
property but classified the increase in value of the pre-marital portion as marital property.
The trial court divided the marital portion of the TVA annuity equally. Husband appealed
the court’s decision, asserting that the trial court erred in classifying the increase in value of
the pre-marital portion of his TVA annuity as marital property.
Citing Pedine v. Pedine, No. E2008-00571-COA-R3-CV, 2009 WL 585943 (Tenn.
Ct. App. Mar. 9, 2009), this court held that the trial court “incorrectly determined the amount
of Husband’s separate property contained in the annuity.” Lund v. Lund, No. E2008-00415-
COA-R3-CV, 2009 WL 723838, at *5 (Tenn. Ct. App. Mar. 19, 2009) (“Lund I”). This court
stated that Wife was not entitled to a share of the increase in value of the pre-marital portion
of the annuity because any increase of that portion was purely market-driven. Lund, 2009
WL 723838, at *5. This court modified the trial court’s judgment to reflect that only
$194,489.04 of Husband’s $453,331.78 TVA annuity was marital property subject to
equitable distribution. Id. This court then concluded,
Because the value of Husband’s separate property is more and the value of the
marital property is less than originally determined by the Trial Court, it is
appropriate to remand this case for the Trial Court to consider whether, due to
the amount of Husband’s increased separate property, it would be equitable for
Wife to receive greater than 50% of the marital property. This should not be
interpreted as a requirement that the Trial Court award Wife more than 50%
of the marital property, and we express no opinion on this issue. Rather, the
Trial Court is to reconsider what is equitable in light of this opinion. The Trial
Court must determine the appropriate percentage to award each party with
regard to the marital property contained in both the annuity and the pension,
keeping in mind that the exact monetary value of the pension cannot be
determined until Husband actually retires.
Id. at *7 (footnote omitted). This court directed the trial court to assign a dollar amount to
each item of property in order to facilitate further appellate review of the distribution of the
property.
On remand, the trial court divided the marital portion of the TVA annuity equally,
finding that
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Wife is educated and able to maintain gainful employment, that she is ten years
younger than Husband, that she will be receiving these benefits and pension
benefits while she is still in her working years, and that she is capable of
accruing additional benefits on her own. In addition, each party has
contributed equally to the assets accumulated during the marriage; Husband
as the primary wage earner and Wife as the primary home maker and each role
deserves equal credit considering all the factors in the statute and the particular
facts of this case. Further, each party has separate property which is due to
either their work efforts prior to the marriage or gifts. Husband had
accumulated retirement benefits prior to the marriage due to his work efforts;
but, also, he will likely need those assets sooner than Wife given his age and
the length of his career. The parties were married just over 24 years, however,
they were living separate and apart for about five years while divorce
proceeding[s] were pending in this and another court. Husband supported
Wife during the long course of the two divorce proceedings spanning several
years, and this allowed her to become educated to where she can now have a
career in the legal field. The parties’ children are grown, and there is no
reason for Wife not to be working full time given that she is clearly healthy,
educated and able to do so. The [c]ourt has duly considered all of the factors
listed in [Tennessee Code Annotated section] 36-4-121 and finds that the
parties should each be awarded one-half of the marital portion of the TVA
annuity.
The court additionally found that while the parties did not present any further evidentiary
proof regarding the distribution of the marital property, “Wife’s statements, even if taken as
testimony and not argument, [we]re insufficient to award her a greater share of the marital
retirement benefits as she requests, when considering the record as a whole.”
The order on remand was filed on September 30, 2009. Less than 30 days later, Wife
filed a motion to set aside the order and a motion to reconsider. These motions were denied
on November 18, 2009. Wife then filed a motion to set aside the court’s order overruling her
motions. After retaining counsel, Wife filed a Rule 60.02 motion to set aside the order on
remand. Wife never filed a notice of appeal from the trial court’s order on remand.
In the Rule 60.02 motion, Wife alleged that the order on remand was inconsistent with
the Tennessee Supreme Court’s decision in Snodgrass v. Snodgrass, 295 S.W.3d 240 (Tenn.
2009), filed approximately one week after the court’s order was filed. Wife opined that
pursuant to Snodgrass, the growth on the pre-marital portion of Husband’s TVA annuity
should have been designated as marital property and equally divided. Wife said that if the
court denied relief pursuant to Snodgrass, she believed the court should redistribute the
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marital assets in a “more equitable manner” as directed by this court in Lund I. In the
alternative, Wife asked the court to set aside its order on remand and enter a new order,
allowing her to file a timely notice of appeal from the order on remand. Wife asserted that
her request pursuant to Rule 60.02 sections (1) and (5) was warranted because she, while
acting pro se and actively attempting to appeal the order on remand, did not realize her
motion to reconsider the denial of her other motions would not toll the time for filing a notice
of appeal.
Husband responded that relief pursuant to Rule 60.02 was not warranted. Husband
asserted that Wife’s filing mistake did not provide a sufficient reason for justifying relief
because pro se litigants must follow the same procedural rules as trained lawyers. Husband
also claimed that the Court’s decision in Snodgrass was not applicable because it was filed
after the trial court’s order, which followed the opinion set forth in Lund I. Husband opined
that the “subsequent alternative interpretation of a statute” in another case was not a ground
for relief and that Snodgrass did not reverse or overturn any cases and dealt with a differing
factual scenario.
Following a hearing on the motion, the court found that “the sole purpose of the Rule
60.02 motion [wa]s to allow [Wife] another chance to appeal where [she] did not appeal in
the time required due to her mistake concerning the law and rules of procedure.” The court
held that relief pursuant to Rule 60.02 was “not proper” and denied Wife’s motion. This
appeal followed.
II. ISSUES
We restate and consolidate Wife’s issue on appeal as follows:
A. Whether the trial court erred in denying relief from its judgment pursuant
to Rule 60.02 of the Tennessee Rules of Civil Procedure.
Husband raised an issue for our consideration that we restate as follows:
B. Whether Wife’s appeal was frivolous, meriting an award of attorney fees
and costs on appeal as sanctions.
III. STANDARD OF REVIEW
On appeal, this court reviews a trial court’s decision to grant or deny relief pursuant
to Rule 60.02 of the Tennessee Rules of Civil Procedure under an abuse of discretion
standard. Federated Ins. Co. v. Lethcoe, 18 S.W.3d 621, 624 (Tenn. 2000); Underwood v.
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Zurich Ins. Co., 854 S.W.2d 94, 97 (Tenn. 1993). Under an abuse of discretion standard, an
appellate court is not permitted “to substitute its judgment for that of the trial court.”
Eldridge v. Eldridge, 42 S.W.3d 82, 85 (Tenn. 2001) (citing Myint v. Allstate Ins. Co., 970
S.W.2d 920, 927 (Tenn. 1998)). As a general principle, an appellate court will find an abuse
of discretion and thus reverse a decision only when the trial court has “applied an incorrect
legal standard, or reached a decision which is against logic or reasoning that caused an
injustice to the party complaining.” State v. Shuck, 953 S.W.2d 662, 669 (Tenn. 1997). See
also Henry v. Goins, 104 S.W.3d 475, 479 (Tenn. 2003).
IV. DISCUSSION
A.
Wife contends that she was entitled to Rule 60.02 relief because the court’s
reclassification of the growth on the pre-marital balance of Husband’s TVA annuity as
separate property was an erroneous application of the law, resulting in extreme hardship and
a significant loss of her share of the marital property. Wife also asserts that she was entitled
to Rule 60.02 relief from the order because the court failed to redistribute all of the marital
assets in an equitable manner as directed by this court in Lund I. Husband responds that the
trial court properly denied relief because Wife failed to file a timely notice of appeal.
Husband asserts that Wife’s attempt to establish that the court’s order on remand contained
errors of law is without merit and merely an attempt to avoid the loss of appellate review
because she failed to file a timely notice of appeal.
Wife focuses her argument on the Tennessee Supreme Court’s decision in Snodgrass
that was filed days after the court’s order on remand. In Snodgrass, the Court dealt with the
narrow issue of whether a party’s 401(k) account was a “retirement or other fringe benefit
right” relating to employment. Snodgrass, 295 S.W.3d at 249. According to Tennessee
Code Annotated section 36-4-121(b)(1)(B) marital property includes
income from, and any increase in value during the marriage of, property
determined to be separate property in accordance with subdivision (b)(2) if
each party substantially contributed to its preservation and appreciation, and
the value of vested and unvested pension, vested and unvested stock option
rights, retirement or other fringe benefit rights relating to employment that
accrued during the period of the marriage.
(Emphasis added). Considering this statute, the Court held that 401(k) accounts accruing
during the marriage were retirement or other fringe benefit rights relating to employment
regardless of whether either spouse had substantially contributed to the preservation and
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appreciation of the account. Snodgrass, 295 S.W.3d at 247-51. In so holding, the Court
offered an extensive analysis of the creation and implementation of 401(k) accounts in
general and the parties’ specific accounts at issue in the case. Id. at 249-51. The Court stated
that “[w]hether the monies within the account [were] marital property or separate property
depend[ed] on when [the account] accrued, not how.” Id. at 251 (citing Franklin v. Franklin,
C/A No. 03A01-9410-CV-00364, 1995 WL 371573, at *2 (Tenn. Ct. App. June 21, 1995)).
In this case, considering when the account accrued, the Court further held that the
portion of the 401(k) account that existed on the date of the marriage was separate property
but characterized “the entire net amount of income and appreciation that was experienced”
in the 401(k) accounts during the marriage “as marital property, including that which accrued
on the pre[-]marital balances.” Snodgrass, 295 S.W.3d at 251. The Court stated that while
its decision in Snodgrass did not conflict with its prior determinations, the “analysis in prior
cases ha[d] often lacked clarity.” Id. at 252. Citing Pedine and other cases, the Court
acknowledged that the Tennessee Court of Appeals had “used inconsistent analyses and
reached inconsistent results” regarding the classification of 401(k) accounts because of a lack
of guidance on that issue. Id. at 254.
In this case, considering whether Husband’s TVA annuity was a retirement or other
fringe benefit right as implicated in Snodgrass would have been a great issue for appellate
review. However, Wife failed to file a timely notice of appeal from the court’s order on
remand, thereby precluding appellate review of this issue. A notice of appeal “must be filed
with and received by the trial court within 30 days after the entry of the judgment appealed
from.” Tenn. R. App. P. 4(a). “The [30-day] time limit for filing a notice of appeal is
mandatory and jurisdictional in civil cases.” Albert v. Frye, 145 S.W.3d 526, 528 (Tenn.
2004) (emphasis added). However, a party may file a post-trial motion that will “toll
commencement of the [30-day] period until an order granting or denying the motion is
entered.” Id. (citing Tenn. R. App. P. 4(a); Binkley v. Medling, 117 S.W.3d 252, 255 (Tenn.
2003)). Once a post-trial motion has been ruled upon, the parties have 30 days in which to
file a notice of appeal from the order granting or denying the post-trial motion. Tenn. R.
App. P. 4(b). Motions to reconsider the court’s grant or denial of a post-trial motions “are
not authorized” and do not “operate to extend the time for appellate proceedings.” Tenn. R.
Civ. P. 59.01.
Because Wife failed to file a timely notice of appeal from the court’s order on remand,
her only avenue of relief was to file a motion pursuant to Rule 60.02 of the Tennessee Rules
of Civil Procedure, which provides, in pertinent part,
On motion and upon such terms as are just, the court may relieve a party or the
party’s legal representative from a final judgment, order or proceeding for the
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following reasons: (1) mistake, inadvertence, surprise or excusable neglect; (2)
fraud [], misrepresentation, or other misconduct of an adverse party; (3) the
judgment is void; (4) the judgment has been satisfied, released or discharged,
or a prior judgment upon which it is based has been reversed or otherwise
vacated, or it is no longer equitable that a judgment should have prospective
application; or (5) any other reason justifying relief from the operation of the
judgment. The motion shall be made within a reasonable time, and for reasons
(1) and (2) not more than one year after the judgment, order or proceeding was
entered or taken.
Relief under this rule is considered “an exceptional remedy.” Nails v. Aetna Ins. Co., 834
S.W.2d 289, 294 (Tenn. 1992). The function of the rule is to “strike a proper balance
between the competing principles of finality and justice.” Banks v. Dement Const. Co., Inc.,
817 S.W.2d 16, 18 (Tenn. 1991) (quoting Jerkins v. McKinney, 533 S.W.2d 275, 280 (Tenn.
1976)). “Rule 60.02 is meant to be used only in those few cases that meet one or more of the
criteria stated.” Toney v. Mueller Co., 810 S.W.2d 145, 146 (Tenn. 1991).
In Wife’s motion for Rule 60.02 relief, she asked the court to vacate and re-enter its
final order because she made a simple filing mistake. While the trial court may not waive
the time requirements for filing a notice of appeal, it may grant relief in “unusual or
compelling circumstances” by “vacating and re-entering the final order.” McCracken v.
Brentwood United Methodist Church, 958 S.W.2d 792, 795 (Tenn. Ct. App. 1997) (citing
Moody v. Moody, 681 S.W.2d 545, 546 (Tenn. 1984); Jerkins v. McKinney, 533 S.W.2d 275,
280 (Tenn. 1976); First Nat'l Bank v. Goss, 912 S.W.2d 147, 148 (Tenn. Ct. App. 1995);
Jefferson v. Pneumo Servs. Corp., 699 S.W.2d 181, 184-85 (Tenn. Ct. App. 1985)). Wife
alleged that she did not realize that her filing of additional post-trial motions would not toll
the time for filing a notice of appeal. However, this type of filing mistake cannot form the
basis for Rule 60.02 relief because pro se litigants “‘must follow the same procedural and
substantive law as the represented party.’” Edmundson v. Pratt, 945 S.W.2d 754, 755 (Tenn.
Ct. App. 1996) (quoting Irvin v. City of Clarksville, 767 S.W.2d 649, 652 (Tenn. Ct. App.
1988)). Thus, her unfamiliarity with the rules did not support a grant of relief in the form of
vacating and re-entering the final order. Accordingly, we conclude that the trial court did not
err in denying relief based upon this ground.
Wife asserts that the trial court should have granted Rule 60.02 relief because of the
decision in Snodgrass and because the court failed to redistribute the marital property as
consistent with this court’s opinion in Lund I. The court found Wife’s arguments
unpersuasive and believed that she was merely attempting to avoid the procedural limitations
that occur when one fails to file a timely notice of appeal. We agree with the trial court.
Wife is clearly attempting to attain full appellate review of her issues when full appellate
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review is simply not possible because she failed to comply with the procedural requirements
for filing a notice of appeal.
Additionally, we do not believe Rule 60.02 relief is warranted because of the Court’s
opinion in Snodgrass. The court’s order on remand was filed prior to Snodgrass and
compliant with this court’s directions in Lund I. Thus, any argument that the court should
have disagreed with Lund I or somehow followed the reasoning in Snodgrass before that
opinion was filed is unavailing. Indeed, the trial court was limited to this court’s opinion
pursuant to the law of the case doctrine. “[U]nder the law of the case doctrine, an appellate
court’s decision on an issue of law is binding in later trials and appeals of the same case if
the facts on the second trial or appeal are substantially the same as the facts in the first trial
or appeal.” Memphis Pub. Co. v. Tennessee Petroleum Underground Storage Tank Bd., 975
S.W.2d 303, 306 (Tenn. 1998). Moreover, as discussed above, Snodgrass dealt with the very
narrow issue concerning 401(k) accounts. At issue in Lund I was the division of Husband’s
TVA annuity. Consequently, we believe that Lund I, while lacking in clear guidance from
the Supreme Court and relying on Pedine, was not necessarily overruled by Snodgrass. Cf.
Gray’s Disposal Co., Inc. v. Metro. Gov’t of Nashville, 318 S.W.3d 342, 354 (Tenn. 2010)
(holding that appellate courts cannot disregard an applicable federal “intervening change in
the controlling authority” while a case is pending on remand). Accordingly, we conclude that
the trial court did not err in denying relief on this ground.
Regarding the distribution of the marital property, we also do not believe that Rule
60.02 relief is warranted on this ground. While the court did not issue findings of fact
regarding the distribution of the entirety of the remaining property, the court listed monetary
amounts for each item that was divided. The court then issued findings of fact relative to its
division of the marital portion of the TVA annuity and pension benefits and stated that it was
rejecting Wife’s argument that she was entitled to a greater share of these benefits because
Husband had been awarded a greater share of separate property. While the court’s decision
regarding the division of the marital property would have been an appropriate issue for
appellate review, Wife failed to comply with the procedural requirements for attaining
appellate review. With these considerations in mind, we conclude that the trial court did not
err in denying relief on this ground.
B.
Husband asserts that Wife is liable for damages in the form of attorney fees and costs
because her appeal was frivolous. Wife disagrees, responding that her appeal was not
frivolous.
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Tennessee Code Annotated section 27-1-122 provides for an award of damages,
including attorney fees, when an appeal is determined to be frivolous. To find an appeal
frivolous, the appeal must be wholly without merit and lacking in justiciable issues. See
Davis v. Gulf Ins. Group, 546 S.W.2d 583, 586 (Tenn. 1977); Indus. Dev. Bd. of Tullahoma
v. Hancock, 901 S.W.2d 382, 385 (Tenn. Ct. App. 1995). Our decision on this issue is
discretionary, and we are generally reluctant to award such damages because we do not want
to discourage legitimate appeals. Whalum v. Marshall, 224 S.W.3d 169, 180-81 (Tenn. Ct.
App. 2006).
Wife did not have a very strong case because she failed to file a timely notice of
appeal from the order on remand following Lund I. However, we do not find Wife’s appeal
wholly devoid of merit because she had a reasonable chance of success by pursuing an appeal
from the denial of her subsequent Rule 60.02 motion for relief. Accordingly, we deny the
request for attorney fees on appeal.
V. CONCLUSION
The judgment of the trial court is affirmed, and the case is remanded for such further
proceedings as may be necessary. Costs of the appeal are taxed to the appellant, Donna Lynn
Lund.
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JOHN W. McCLARTY, JUDGE
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