Robert S. Jones v. Cristobel O. von Hemert Jones ( 2012 )

COURT OF APPEALS OF VIRGINIA
Present: Judges Elder, Beales and Senior Judge Willis
UNPUBLISHED
Argued at Salem, Virginia
ROBERT S. JONES
MEMORANDUM OPINION * BY
v. Record No. 2086-11-3 JUDGE LARRY G. ELDER
OCTOBER 9, 2012
CRISTOBEL O. VON HEMERT JONES
FROM THE CIRCUIT COURT OF ROCKINGHAM COUNTY
Thomas J. Wilson, IV, Judge
George H. Dygert (Dygert, Wright, Hobbs & Heilberg, PLC, on
briefs), for appellant.
Shelly R. James (Danita S. Alt; Law Office of Shelly R. James,
PLLC, on brief), for appellee.
Robert S. Jones (husband) appeals the equitable distribution award accompanying his
divorce from Cristobel O. von Hemert Jones (wife). On appeal, he argues that the trial court
erred by imposing a constructive trust on a portion of the parties’ marital property. Husband also
challenges the classification of the small farm as wife’s separate property, the finding that
husband did not prove outstanding debts to his friends Kinsey and Lilly, the determination of the
rental value of the rental house as a marital asset, and the finding of the value of the horses as
provided by wife’s expert witness testimony. Wife seeks an award of attorney’s fees and costs.
For the reasons that follow, we affirm, and we deny wife’s request for fees and costs.
*
Pursuant to Code § 17.1-413, this opinion is not designated for publication.
I.
BACKGROUND
After the parties married in 1979, wife’s father, John von Hemert, bought them a house
on an acre of land. The parties used the property as their marital home.
Von Hemert also bought fourteen acres of land for the parties’ use (“the small farm”).
The parties farmed and trained horses on the land. They paid von Hemert $200 a month in rent
for use of the property, although they did not sign a lease. The parties paid for minor
improvements and repairs on the property; von Hemert paid for other improvements and upkeep
on the property.
Von Hemert created a trust specifying that upon his and his wife’s death, the small farm
would pass to his “daughter Cristobel O. Jones.” Both von Hemert and his wife are now
deceased. Husband testified that he had expected that he and wife would each inherit
half-ownership of the small farm upon von Hemert’s death in exchange for his maintenance of
the property.
The parties subsequently bought sixty-one acres (“the large farm”), in part using money
from the children’s trust funds. The children were told the land “was an investment for [their]
futures.” The parties partitioned three acres from the large farm and built a new marital home on
it (“the house tract”). The parties rented out their previous home. Mary Harris moved into the
rental house in 2006. Harris did not pay rent, but the lease obligated her to help on the horse
farm in exchange for her occupancy. Harris was physically able to provide only limited help due
to her poor physical health. Wife wanted Harris to pay monetary rent. She testified that she had
believed Harris’s rent to be “forthcoming.”
Approximately two weeks before trial, wife designated Darlene Kemper as an expert in
the valuation of horses owned by the parties. On the day of trial, husband objected to Kemper as
-2-
an expert witness because wife had not provided this information during discovery. The trial
court overruled husband’s objection as untimely.
At trial, Kemper provided valuations for the parties’ horses. Kemper testified that she
was familiar with the parties’ horse farm and some of their horses. However, she had not seen
any of the horses in at least a year. Husband testified that most of the horses were unbroken and
therefore worthless. Husband stated that as a result he gave away all but two of the horses.
Husband also testified that he borrowed $20,000 from his friend, Sam Lilly, and $10,000
from his friend, Glen Kinsey, for improvements on the farm in 2009. Husband presented loan
documents to the trial court, but no other supporting evidence. Each loan agreement provided
that husband would pay $1,000 interest yearly to the loan holder until the loan was repaid in full.
Husband testified that both debts were outstanding.
In the divorce decree, the trial court decided equitable distribution. In pertinent part, the
trial court found that half of the funds used to buy the large farm and the house tract were from
the children’s “trust/education funds.” Therefore, the trial court reasoned:
A one-half interest of the Large Farm will be subject to a
constructive trust for the benefit of the two children. The Court
further finds that the house was built on three acres that were
originally part of the 61 acres that the children’s trust money
purchased a one-half interest in as set forth above. The court finds
that a constructive trust be placed upon the marital residence and
the three acres of land . . . for the benefit of the children.
The trial court concluded that the large farm and house tract were marital property, subject to the
children’s trust.
The trial court found that the small farm was in von Hemert’s trust, and wife’s “right to
the property vested at the death of her mother.” As for the alleged loans from Kinsey and Lilly,
the trial court questioned the credibility of husband’s evidence, noted the lack of documentation
of the funds themselves, and found husband failed to establish the existence of the debts. The
-3-
trial court alternatively found that if the debts “somehow exist[ed], [they] would be husband’s
sole obligation.”
The trial court classified the rental house as marital property. The trial court found that
husband allowed Harris to live in the rental property rent-free without wife’s knowledge. The
trial court reasoned, “[T]he house could have been providing rental income to the family in that
amount [of fair rental value] while occupied by Ms. Harris, and as it had in the past. The Court
will treat the five years of occupancy as a rental income of $30,000.00, and will treat that as an
asset to be allocated to husband.”
Regarding the horses’ valuations, the trial court discounted husband’s testimony as
incredible. The trial court found Kemper’s testimony to be “the most reliable evidence of their
value.”
On appeal, husband asks this Court to reverse and remand to the trial court for
reconsideration of the equitable distribution award. 1
II.
ANALYSIS
A. Constructive Trust
Husband argues that the trial court lacked the authority to impose a constructive trust on
the house tract and the large farm. Wife counters that husband lacks standing to contest the
imposition of the trust because the trial court awarded the property to her. Wife further contends
that the constructive trust was an appropriate acknowledgment of a marital debt rather than an
equitable distribution award to a non-party.
1
Wife argues that husband did not preserve his assignments of error for appeal by failing
to adequately raise them at the trial level. We have reviewed the record and find that husband
adequately preserved his assignments of error under Rule 5A:18.
-4-
We first address wife’s standing argument. The circuit court found that both the large
farm and the house tract were marital property. Therefore, husband does, in fact, have standing
to challenge this portion of the circuit court’s ruling. See Grisso v. Nolen, 262 Va. 688, 693, 554
S.E.2d 91, 94 (2001) (“‘The point of standing is to ensure that a person who asserts a position
has a substantial legal right to do so and that his rights will be affected by the disposition of the
case.’” (quoting Cupp v. Bd. of Supervisors, 227 Va. 580, 589, 318 S.E.2d 407, 411 (1984))).
The trial court’s allocation of the house tract and the large farm to wife in dividing the marital
estate did not deprive husband of his interest in those properties as marital property.
However, the trial court’s purpose in establishing the constructive trust was simply to
recognize the children’s interest in the properties for purposes of equitable distribution. Because
neither party denies the children’s interest in the properties, the imposition of the constructive
trust as opposed to a simple recognition of the parties’ debts to the children did not affect the
equitable distribution award. Therefore, the trial court’s authority, or alleged lack thereof, does
not provide husband with a suitable basis to challenge the equitable distribution award. 2
B. Small Farm as Separate Property
Husband contends that the trial court erred in determining the small farm was wife’s
separate property. He argues that instead the fourteen acres and the improvements on it should
be considered marital property. Wife responds that the trial court correctly interpreted the
language of von Hemert’s trust in concluding the small farm was her separate property.
Husband relies on the following language in von Hemert’s trust:
My Trustee shall distribute all my interest in a parcel of real
property containing approximately fourteen acres located on the
northwestern side of State Highway No. 807 . . . , adjacent to a
2
We are not ruling on the appropriateness of establishing a constructive trust for
individuals not parties to the litigation in an equitable distribution proceeding. This decision
does not preclude a party from challenging the constructive trust in the appropriate forum.
-5-
parcel owned by my daughter Cristobel O. Jones, including all my
farm equipment and my farm pick-up truck, to my daughter
Cristobel O. Jones if she is then living.
Husband contends that the language “my daughter Cristobel O. Jones” is ambiguous, because the
adjacent parcel was actually owned by both parties.
The trial court held that this language unambiguously referred to wife. We review the
language in von Hemert’s trust de novo. See Riverside Healthcare Ass’n, Inc. v. Forbes, 281 Va.
522, 528, 709 S.E.2d 156, 159 (2011).
When considering the language used in a trust agreement,
“the intent of the grantor controls.” Harbour v. SunTrust Bank,
278 Va. 514, 519, 685 S.E.2d 838, 841 (2009). We ascertain the
intent of the grantor by looking at the language used in the trust
agreement. Id. As with other written instruments, “‘[t]he primary
significance of words should ordinarily attach and does attach,
unless it is manifest from the [instrument] itself that other
definitions are intended.’” Wallace v. Wallace, 168 Va. 216, 224,
190 S.E. 293, 296 (1937) (quoting Rady v. Staiars, 160 Va. 373,
376, 168 S.E. 452, 452 (1933)).
Id. at 529, 709 S.E.2d at 160 (alterations in original).
We conclude that the language in the trust that the small farm was to be left “to [von
Hemert’s] daughter Cristobel O. Jones if she is then living” meant just that: the property was left
to wife. The fact that the trust referred to the adjacent parcel as owned by wife when she shared
ownership with husband does not render the use of her name ambiguous. Because the language
in the trust was unambiguous, we do not consider the extrinsic evidence of von Hemert’s intent.
See, e.g., Lawless v. Lawless, 187 Va. 511, 519, 47 S.E.2d 431, 434 (1948) (“[U]nder certain
circumstances and conditions, extrinsic evidence may be admissible to explain ambiguous
language in a will . . . .”). Thus, we conclude that the trial court did not err by finding the small
farm was wife’s separate property.
-6-
C. Debts to Kinsey and Lilley
Husband argues that the trial court erred in finding that he did not owe a debt to either of
husband’s friends, Kinsey or Lilly. He contends that without evidence contesting the existence
of those debts, the trial court was required to accept his testimony that he borrowed the money.
Further, husband contends that the loans are marital debts. Wife responds that the trial court
acted within its discretion in rejecting husband’s impeached and inconsistent testimony.
On appeal, we view the evidence in the light most favorable to wife, as the prevailing
party below. Brown v. Burch, 30 Va. App. 670, 681, 519 S.E.2d 403, 408-09 (1999). “‘Where,
as here, the court hears the evidence ore tenus, its finding is entitled to great weight and will not
be disturbed on appeal unless plainly wrong or without evidence to support it.’” Street v. Street,
25 Va. App. 380, 387, 488 S.E.2d 665, 668 (1997) (en banc) (quoting Martin v. Pittsylvania
Cnty. Dep’t of Soc. Servs., 3 Va. App. 15, 20, 348 S.E.2d 13, 16 (1986)). We recognize
Supreme Court precedent that a trial court may not “arbitrarily disregard uncontradicted evidence
of unimpeached witnesses which is not inherently incredible and not inconsistent with the facts
appearing in the record, even though such witnesses are interested in the outcome of the case.”
Hodge v. Am. Family Life Assurance Co., 213 Va. 30, 31, 189 S.E.2d 351, 353 (1972).
However, this is not what occurred here.
Husband testified that he handwrote the loan document for the loan from Kinsey. In
contrast, Harris testified that she handwrote the document, although husband provided the
wording.
Husband testified that he took out the loans to pay for farm expenses. Although the 2009
agreements provided husband would pay $1,000 interest to each Kinsey and Lilly annually, his
tax records from 2009 and 2010 did not show any non-mortgage interest paid as a farm expense.
Last, the written loan agreements did not indicate husband’s actual receipt of the money.
-7-
In light of the evidence inconsistent with husband’s testimony, the trial court was entitled
to reject husband’s testimony that he had outstanding debts to Kinsey and Lilly.
D. Rental Value of House
Husband contends that the trial court erred “in determining that the rental value of the
small house during the time it was occupied by Ms. Harris is a marital asset.” Wife responds that
the record supports the trial court’s finding.
To the extent husband argues that wife agreed to let Harris live there rent free, “the trier
of fact ascertains a witness’ credibility, determines the weight to be given to [a witness’]
testimony, and has the discretion to accept or reject any of the witness’ testimony.” Street, 25
Va. App. at 387, 488 S.E.2d at 668. The trial court was entitled to accept wife’s testimony that
she had not agreed for Harris to live at the house rent free and that she expected the rent to be
forthcoming.
To the extent that husband challenges the amount that the trial court assigned as the lost
value of the rental house, the trial court based the value on the rental income the parties received
when they previously rented the house to a paying tenant. The trial court’s valuation is a finding
of fact, and we “will ‘affirm if the evidence supports the findings and if the trial court finds a
reasonable evaluation.’” Sfreddo v. Sfreddo, 59 Va. App. 471, 493, 720 S.E.2d 145, 156 (2012)
(quoting Howell v. Howell, 31 Va. App. 332, 339, 523 S.E.2d 514, 518 (2000)). We hold the
trial court’s valuation was reasonable and supported by the evidence in the record.
To the extent that husband argues that Harris’s help on the farm constituted reasonable
consideration in exchange for the lease, and thus there was no unrealized value from the rental
house, the trial court, citing “credibility issues,” rejected the testimony that Harris provided any
consideration in exchange for her occupancy of the house. It is undisputed Harris’s poor health
-8-
limited the amount of assistance she could render. After reviewing the record, we conclude that
the trial court’s finding was not plainly wrong or without evidence to support it.
For these reasons, we affirm on this issue.
E. Kemper’s Testimony
Husband contends that the trial court should not have allowed Kemper to testify as an
expert witness and that her testimony lacked an adequate foundation. 3 Wife responds that
husband’s objection to Kemper as an expert witness was not timely and that the trial court
appropriately exercised its discretion in finding Kemper’s valuations credible.
Husband argued in closing that his testimony that the horses were worthless was more
persuasive than Kemper’s valuation. The principles that “the trier of fact ascertains a witness’
credibility” and “determines the weight to be given to [a witness’] testimony” apply to the
testimony of both lay and expert witnesses. Street, 25 Va. App. at 387-89, 488 S.E.2d at 668-69.
Because the valuation of the trial court was reasonable and supported by the evidence in the
record, we affirm on this issue. See Sfreddo, 59 Va. App. at 493, 720 S.E.2d at 156.
F. Attorney’s Fees
Wife seeks attorney’s fees and costs incurred in this appeal. “The appellate court has the
opportunity to view the record in its entirety and determine whether the appeal is frivolous or
whether other reasons exist for requiring additional payment.” O’Loughlin v. O’Loughlin, 23
Va. App. 690, 695, 479 S.E.2d 98, 100 (1996). Because husband’s appeal is not frivolous, we
deny wife’s request for fees and costs.
3
To the extent husband contests the trial court’s overruling as untimely his objection to
Kemper as an expert witness, his argument is barred by Rule 5A:20(c) because he did not
include this argument in an assignment of error. See, e.g., Zedan v. Westheim, 60 Va. App. 556,
569 n.4, 729 S.E.2d 785, 791 n.4 (2012). Similarly, to the extent husband challenges the
admissibility of Kemper’s testimony due to the lack of an adequate foundation, that argument is
foreclosed by Rule 5A:18, because he did not object at trial to the admissibility of Kemper’s
testimony based on an alleged lack of an adequate foundation.
-9-
III.
For the reasons stated above, we affirm the equitable distribution award and deny wife’s
request for attorney’s fees and costs.
Affirmed.
- 10 -