Mary Beth Bundschuh v. William P. Bundschuh ( 1998 )

COURT OF APPEALS OF VIRGINIA
Present: Judges Baker, Bray and Overton
Argued at Norfolk, Virginia
MARY BETH BUNDSCHUH
MEMORANDUM OPINION * BY
v. Record No. 2574-97-1 JUDGE RICHARD S. BRAY
JUNE 16, 1998
WILLIAM P. BUNDSCHUH
FROM THE CIRCUIT COURT OF THE CITY OF VIRGINIA BEACH
Edward W. Hanson, Jr., Judge
Irene Sutton (Law Offices of Charles
Hofheimer, P.C., on briefs), for appellant.
Gregory K. Pugh (Bobby W. Davis, on brief),
for appellee.
In the decree of divorce between Mary Beth Bundschuh (wife)
and William P. Bundschuh (husband), the trial court, inter alia,
affirmed the report of the commissioner in chancery which valued
husband's stock in a medical practice at "zero." Wife appeals,
arguing that the court erroneously relied upon the terms of the
corporate bylaws to ascertain the worth of husband's interest.
We disagree and affirm the decree.
The parties are fully conversant with the record and this
memorandum opinion recites only those facts necessary to
disposition of the appeal.
Under familiar principles, "we construe the evidence in the
light most favorable to husband, the prevailing party below,
granting to him all reasonable inferences fairly deducible
*
Pursuant to Code § 17-116.010 this opinion is not
designated for publication.
therefrom." Rogers v. Yourshaw, 18 Va. App. 816, 818, 448 S.E.2d
884, 885 (1994) (citation omitted). "In all divorce cases in
which equitable distribution issues are presented, fashioning the
decree is left largely to the discretion of the trial court as
empowered and instructed by Code § 20-107.3." McClanahan v.
McClanahan, 19 Va. App. 399, 400, 451 S.E.2d 691, 692 (1994)
(citation omitted). Absent an abuse of discretion, a departure
from the mandate of statute, or findings unsupported by the
record, the chancellor's award will not be reversed on appeal.
Id. at 401, 451 S.E.2d at 692. "The burden is upon the party
appealing to point out the error in the decree and to show how
and why it is wrong," and "[t]he decree stands until that burden
has been met." Kaufman v. Kaufman, 7 Va. App. 488, 499, 375
S.E.2d 374, 380 (1988) (citation omitted).
The instant proceedings for divorce and equitable
distribution were referred to a commissioner in chancery for
hearing and report to the court. The value of husband's stock in
Julius J. Snyder, M.D. & Associates, an incorporated
anesthesiology practice, was a substantial issue between the
parties. The evidence disclosed that husband's shares in the
corporation were subject to a provision in the bylaws which
established a formulaic "purchase or redemption price." Wife's
expert, David P. Miller, testified that this approach to value
was inapplicable and opted, instead, for the "capitalization of
excess earnings" method, assigning a worth of $218,443 to
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husband's interest. In contrast, husband's expert, H. Leon
Hodges, deferred to the bylaws and, accordingly, found that the
husband's stock was without value.
After acknowledging during the evidentiary hearing that he
"d[id not] have to follow the value set up in the buy-sell
agreement," the commissioner, nevertheless, concluded that "the
parties are bound by the terms of the corporation's buy/sell
agreement which restricts the amounts of money to be paid to a
withdrawing stockholder" and fixed "the value of husband's
interest [at] zero." Wife excepted, and, following a related
hearing, the court noted that "each [expert] gave plausible
testimony as to valuation," but reminded counsel that "it was up
to the commissioner to make a determination as to the
credibility . . . and weight to be placed upon their testimony."
Finding that the commissioner properly "made a determination
based upon the evidence," the court affirmed the report.
On appeal, wife contends that "[b]ecause neither expert
valued the practice under the other expert's set of assumptions,
this appeal does not present a . . . question of fact," but,
rather, an issue of law arising from the erroneous premise that
value was controlled by the formula prescribed in the bylaws. In
support of her argument, wife relies upon Bosserman v. Bosserman,
9 Va. App. 1, 384 S.E.2d 104 (1989). In Bosserman, we held that
"the sale price set by restrictive provisions on transfer" of
stock was "not conclusive as to the value." Id. at 7, 384 S.E.2d
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at 108. However, we recognized that such covenants affected
value through impaired marketability and "must be considered when
a trial court determines the value of stock for purposes of
equitable distribution." Id. Indeed, quoting Bosserman, wife
correctly acknowledges on brief that "a buy-sell agreement might
be controlling in a particular case, if the agreement properly
reflects 'the actual value of the stock to the shareholder.'" 9
Va. App. at 7, 384 S.E.2d at 108.
Here, husband's expert testified that he regarded the
agreement as the predominate factor in valuation, while wife's
expert admitted that his approach did not "take into
consideration the buy-sell agreement at all." In weighing this
testimony, the record reflects that the commissioner considered
the disparate approaches to value and other relevant evidence in
determining the husband's stock to be worthless, a factual
analysis consistent with Bosserman. On review, the trial court
found that the commissioner had properly balanced the evidence,
including the credibility of witnesses, in reaching a factual
finding and confirmed and incorporated the report in the final
decree. Thus, the record clearly reflects the resolution of a
factual dispute in accordance with controlling principles of law.
"While the report of a commissioner in
chancery does not carry the weight of a
jury's verdict, Code § 8.01-610, it should be
sustained unless the trial court concludes
that the commissioner's findings are not
supported by the evidence. This rule applies
with particular force to a commissioner's
findings of fact based upon evidence taken in
his presence . . . ."
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Jones v. Jones, 26 Va. App. 689, 694-95, 496 S.E.2d 150, 153
(1998) (citation omitted). "Once the trial court has resolved
conflicting evidence as to value and determined value, the
decision whether to make a monetary award and the amount of the
award is governed by the rights and equities of the parties and
the factors designated in Code § 20-107.3(E)." Bosserman, 9 Va.
App. at 5, 384 S.E.2d at 107 (citations omitted). "We will not
disturb the trial court's finding of the value of an asset unless
the finding is plainly wrong or unsupported by the evidence."
Schooltz v. Schooltz, 27 Va. App. 264, 275, ___ S.E.2d ___, ___
(1998) (citations omitted).
The instant record discloses conflicting evidence of value
in the opinions and related testimony of two expert witnesses.
The factual predicates for both conclusions were before the
commissioner and court and properly considered, together with
other pertinent evidence, in finding that husband's stock had no
value, a determination supported by the record which will not be
disturbed on appeal.
Accordingly, we affirm the decree.
Affirmed.
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