IN THE COURT OF APPEALS OF TENNESSEE FILED May 21, 1999 AT KNOXVILLE Cecil Crowson, Jr. Appellate C ourt Clerk

RUBYE WYRICK CRESWELL, ) C/A NO. 03A01-9804-CH-00151 ) Plaintiff-Appellee, ) KNOX CHANCERY ) v. ) HON. H. DAVID CATE, ) CHANCELLOR JOHN E. CRESWELL, ) ) AFFIRMED AND Defend ant-App ellant. ) REMANDED

JOHN P. VALLIA NT, JR., and PAUL HENSLEY , Knoxville, for Plaintiff-Appellee.

SARAH Y. SHEPPEARD and JASON H. LONG, SHEPPEARD & SWANSON, P.L.C., K noxville, fo r Defen dant-Ap pellant.

O P I N IO N

Franks, J.

In this divorce action both parties appeal the distribution of the marital property ordered by the Trial Judge, raising issues as to the classification, valuation and equitable distribution of the properties owned by the parties at the time of the divorce.

The parties were married on April 4, 1959, and no children were born of the ma rriage, a lthoug h the hu sband had thr ee dau ghters fr om a p rior ma rriage.

In making the property division, the Trial Court said that he was taking into account the property which the parties said they brought into the marriage as separate property, as well as other relevant factors in Tennessee Code Annotated Section 36-4-121(c). The Court adopted the wife’s values on the real property, because they were corroborated by an appraiser, and also adopted her values on the vehicles, because they w ere substantiated by the N APA car v alue guide. The cou rt placed no value on two tax shelter partnerships, Capital Housing Partners and Strauss Greenberg, because as long as the property is not sold it would not have any negative tax liability. The court also calculated the present value of the wife’s life estate in an irrevocable trust to be approximately $160,000.00, but conceded that this is not an exact calculation due to potential variables. The Court’s distribution of the marital estate, by the Court’s evaluation, awarded $868,545.82 to the wife and $1,318,376.50 to the husband. Of the total marital estate of $2,004,922.32, the wife received 34% of the marital assets, while the husband received 66%. Taking into consideration the award of alimony in solido in the amount of $200,000.00, the wife would receive 44% of the marital estate, which the Trial Court stated is what he intended in making the proper ty divisio n equita ble.

The case was tried before the Court without a jury, and our standard of review is de novo upon the record of the Trial Court, accompanied by a presumption of correctness of its findings, unless the evidence preponderates otherwise. T.R.A.P. Rule 1 3(d). Bookout v. Bookout, 954 S.W.2d 730, 731 (Tenn. App. 1997). Trial courts are given a great deal of discretion in division of marital property, and the division s mad e are en titled to g reat we ight in th e appe llate cou rts. See Ford v. Ford, S .W.2d 824, 82 6 (Ten n. App . 1996) .

First, the husb and argu ed that the T rial Court’s aw ard of alim ony in solido lacks any legal b asis. While the Trial Co urt designa ted the aw ard as alim ony in

solido, it is clear that the court intended to utilize the award as a vehicle to arrive at an equitable distribution of the marital estate. The Trial Court listed the cash amount as a part of the division of the marital estate, and stated in his Order on All Pending Motions that the “court believes that its distribution of the marital estate was fair and equitable. The plaintiff received approximately 44% of the marital estate and the defendant received approximately 56% of the marital estate.” This result can only be reached by including the cash award to the wife in the division of the marital estate, which resulted in a divis ion of m arital pro perty w hich the Court f ound to be equ itable.

We find the husba nd’s conte ntion to be w ithout me rit.

The hus band arg ues that he b egan Cre swell & C ompan y with $50,000.00 worth of assets that he owned prior to the marriage, and that the proceeds from the sale of the company, and the property purchased with those proceeds, constitute separate property, which the Trial Court treated as marital property. The evidence does not p reponde rate against th e Trial Judg e’s findings. T .R.A.P. R ule 13(d). In this c onnection , the Trial Jud ge adopte d the wife’s value of the irrevocable trust, which in cluded the $50,000 .00 which the husba nd claime d was sep arate property. Thus, the Trial Court concluded the property was a marital asset. In an Order, the Trial Judge noted that the husband’s testimony on when he acquired the stock “was not very positive”. Though the husband testified he owned the stock prior to the m arriage , the wif e testified that he d id not o wn an y stock when they m arried.

The wife further produced the husband’s prior Divorce Decree, entered less than two months before the p arties were m arried wh ich dispose d of mo st of the ma rital property in the prior marriage, but made no mention of any stock ownership. The credibility of the witnesses is resolved by the Trial Court, and we uphold the Trial Judge’s finding on this issue.

The evid ence sho ws that the p arties held sub stantial investm ents in their

own names, and the husband insists that the parties kept their assets separate, and intended to keep their property separate. The determination of separate property is a question of fact, and we conclude the evidence does not preponderate against the Trial Court’s determination that all of such property was marital. This finding is buttressed by the fact th at the husba nd did no t claim these assets as sep arate prope rty in his proposed property division.

Next, the h usband a rgues the T rial Court erre d in valuing the irrevoca ble trust at $160,000.00. The value of a marital asset is a question of fact, and a Trial Court’ s decisio n on the value o f a mar ital asset is given g reat we ight on appea l.

Wallace v. Wallace, 733 S.W.2d 102, 107 (Tenn. App. 1987). We conclude the eviden ce doe s not pre ponde rate aga inst the T rial Cou rt’s deter minati on of th e value .

Neither party presented evidence of the present value, the wife’s life expectancy, or the proper interest rate that should be used in calculating the value. The husband argues in h is brief that the tru st should be treated as an annuity. U sing tables fo und in Tennessee Code Annotated, the husband determined the wife’s life expectancy to be 20.31 years. Using Annuity Table IX, the husband then calculated the present value of an annuity producing $23,400.00 per year for 20 years at 6% to be $268,395.66, which he claim s is the pr oper pr esent v alue of th e trust.

The hus band, how ever, used th e wrong table in his calc ulation. Tab le IX calcula tes the value of an ann uity for a certa in numb er of years. T he trust is contingen t upon the w ife’s life, so it shou ld not be trea ted as an an nuity for a sp ecific number of years. In the Explanation of Use to the Annuity and Valuation Tables, the Code states, “To find the present value of an annuity based on the life of a person from the fo llowing tab les multiply the yearly p aymen t by the num ber found opposite the present age of the person upon whose life the annuity is based in the column for the applicable percent.” T.C.A. Tables p. 1035 (1995). Using this method and the

various tables following, the present value of the trust at 6% ranges from $150,064.20 to $208,049.40, depending upon the table used. Due to lack of specific evidence of the value at trial, the present value of the trust according to the annuity tables, and the presumption of correctness of the Trial Judge’s determination, it cannot be said the eviden ce prep ondera tes again st the va luation o f the trus t at $160 ,000.00 .

The husband also claims that the Trial Court erroneously valued two tax shelters, Capital Housing Partners and Strauss Greenberg. The Trial Court recognized the husba nd’s assertion that these asse ts have a ne gative valu e because of tax liability if sold, but stated, “as long as the interests are not sold they do not result in any tax liability” and ass igned n o value to the tax shelters and aw arded th em to th e husb and.

The husband insists that if the properties were sold the tax liability would be significant. A certified public accountant, testified that the two entities have a negative equity because of the tax consequences, and he recommends that people do not sell such entities.

While the entities may have tax a liability, if sold, there was no evidence that they hold any other value. They may be subject to income tax if they earn money, but ther e was n o evide nce pre sented on prec isely ho w that s hould e ffect the ir value.

Since there is no negative impact if the entities are not sold, and no evidence of how any possib le income would e ffect their value , the evidenc e does no t prepond erate agains t the Tria l Court ’s determ ination.

The wife argues that the Trial Judge erred in failing to award her an equitable division of the corpus of two trusts in the marital estate. In this connection marital property must be valued “as of a date as near as reasonably possible to the final divorce hearing date.” T.C.A. §36-4-121(b)(1)(A) (1996). One trust was an irrevocable trust for the benefit of Rubye Creswell, which contained over $400,000.00 in assets, but w hich the T rial Court va lued at $16 0,000.00 b ecause it w as only w orth

its income stream to th e parties. Th e other trust w as an revo cable trust for th e benefit of the husband, which the Court valued at $631,324.37. This was the value of the assets in the tru st. The Co urt conclud ed that it wa s worth the amoun t of the assets instead of the income stream, because the husband could terminate the trust at any time and receive the assets at their value.

Both trusts were funded with marital assets, and both trusts were created before the divorce petition was filed. The evidence does not preponderate against the Trial Judge’s valuation. The wife may not have liked the terms of the trust, but she did stop its execution, and the value of the marital asset was reduced by the creation of the trust so that at the time of trial the Court properly assigned the assets a present value and utilized those values in making distribution of the marital estate.

The wife insists the husband improperly dissipated the marital estate by makin g gifts in violatio n of the Order of the C ourt in th e amo unt of $ 85,300 .00.

While the evidence shows that the husband made $86,000.00 in gifts to his children and grandchildren after the Order was issued, which prevented him from disposing of marital asse ts, these gifts did n ot render the property d ivision of the m arital estate inequitable on this record.

These gifts did come from marital property that had not yet been valued and divided by the Court, but in his finding of fact the Trial Judge stated, “Over the course of the marriage the parties have made gifts to their family members. The plaintiff gifting ap proxima tely $92,50 0.00 and th e defenda nt gifting app roximate ly $115,000.00 to his daughters, in addition to the stock. He also made gifts to the grandchildren w hich now total, including the income, $183 ,000.00.” The w ife advised the Court in her testimony that she wanted the Court to take into account the gifts given by each party in the distribution of the marital property. Since she did not insist upon an amount of dissipation, and since the Trial Court did find and consider

that both pa rties gave su bstantial gifts to th e family in a rriving at the p roperty division , we find no erro r. Finally, the h usband a rgues that the parties had d isposed of th eir assets through a contract before the divorce, and the Court should enforce that contract. He asserts that the parties had an oral agreement in which the husband would create an irrevocable trust for the w ife’s benefit, in e xchange for her signin g over he r interest in other prop erty to him alone. The Trial Cou rt, after hearing th is testimony , refused to enforce this alleged contract, and held “there was insufficient m utual assent to form the contract the defendan t seeks to enforce.” The C ourt then pointed out that the w ife understood that the trust assets would be hers and would not pass to his children, and that she would not have to convey any property, while the husband understood just the oppos ite. Acc ording ly, we h old ther e was n o mee ting of th e mind s.

Due to the conflicting testimony of the parties as to whether a contract existed, and if it did, as to what the term s of the contract were, the T rial Court approp riately d etermi ned tha t the evid ence d id not es tablish a n enfor ceable contrac t.

See Sweeten v. Trade Envelopes, Inc., 938 S.W.2d 3 83 (Tenn. 1996 ).

While both parties insist that the division of marital property was not equitable, the evidence does not preponderate against the division made by the Trial Court. In viewing the evidence and the factors set forth in T.C.A. §36-4-121(c), the factors a re either irreleva nt or ten d to fav or a nea r equal d ivision o f the m arital esta te.

While an equal division of the marital estate could have been appropriate in this case, we hold the division reached by the Trial Court is an equitable distribution.

Accord ingly, we a ffirm the jud gment o f the Trial C ourt and rem and with the cost of the appeal assessed one-half to each party.

__________________________ Herschel P. Franks, J.

CONCUR:

___________________________ Houston M. Godd ard, P.J.

___________________________ William H. Inman, Sr.J.