Freeman v. Freeman

430 So. 2d 673
CourtLouisiana Court of Appeal
DecidedMarch 28, 1983
Docket15174-CA
StatusPublished
Cited by6 cases

This text of 430 So. 2d 673 (Freeman v. Freeman) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Freeman v. Freeman, 430 So. 2d 673 (La. Ct. App. 1983).

Opinion

430 So.2d 673 (1983)

Donna Susan Barnhill FREEMAN, Plaintiff-Appellant,
v.
Robert Kay FREEMAN, Defendant-Appellee.

No. 15174-CA.

Court of Appeal of Louisiana, Second Circuit.

March 28, 1983.
Writ Denied June 10, 1983.

*674 McLeod, Verlander & Dollar by Robert P. McLeod, Monroe, for plaintiff-appellant.

Farrar & Jefferson by Stephen A. Jefferson, Monroe, for defendant-appellee.

Before PRICE, HALL and SEXTON, JJ.

HALL, Judge.

Plaintiff, Susan Barnhill Freeman, appeals the judgment of the trial court rejecting her demands to be recognized as the owner of an undivided one-half interest in and for a partition of property allegedly belonging to the community of acquets and gains formerly existing between her and her former husband, Robert K. Freeman, or allegedly owned in indivision by the parties.

Mr. and Mrs. Freeman were married in 1966. They were judicially separated in September 1972, and about six months later they reconciled and resumed the marital relationship. However, Mr. and Mrs. Freeman did not execute the authentic act reestablishing the community required by LSA-C.C. Art. 155 as then written. The parties again separated in January 1980 and were divorced on May 29 of that year.

On June 26, 1980 Mrs. Freeman filed a petition for partition of the property acquired by the parties between 1972 and their divorce, particularly the family home, stock in the corporate business conducted by Mr. Freeman, an oil and gas lease, life insurance policies, bank accounts, and miscellaneous movable property. Mr. Freeman filed exceptions of no cause and no right of action claiming that the 1972 separation judgment terminated the community between himself and his wife and that the community had never been reestablished in *675 accordance with law after the parties' reconciliation. The trial judge overruled these exceptions and the case proceeded to a trial on the merits which resulted in the judgment complained of.

On appeal Mrs. Freeman contends the trial court erred in not finding her to be the owner of a one-half interest in the property mentioned above. She offers several possible theories in support of her claim, all of which will be discussed below. Mr. Freeman's contention before this court is that the parties had no community property in 1972 when they first separated, and because the community was never reestablished in accordance with Article 155, the parties remained separate in property until their divorce and Mrs. Freeman did not acquire any ownership interest in the property acquired by her husband after 1972. For the reasons set forth in this opinion, which are substantially the same reasons set forth in the able trial court's written reasons for judgment, we find it necessary to affirm the judgment in favor of defendant in spite of the apparent equities in favor of the plaintiff.

The evidence, virtually undisputed, focuses on two items of property of significant value which were acquired during the marriage after the parties' reconciliation, the stock in the corporate business operated by Mr. Freeman and the family home.

In late 1974 or early 1975 Mr. Freeman was working for his father who was the sole owner of the stock of Freeman Chemical and Cementing Company, Inc., an oil well service business. Freeman had the opportunity to buy his father's interest in the business and attempted to obtain financing from several banks and other sources, all of which turned him down because he had insufficient collateral with which to secure a loan for the $30,000 purchase price of the stock in the company. Freeman asked his wife to ask her father, D.V. Barnhill, to arrange financing for the purchase, which she did. After some discussion, Mr. Barnhill agreed to help with the financing of the purchase of the stock which was to be acquired equally by Freeman and Mrs. Freeman's brother, Joe Barnhill. A $30,000 loan was obtained from Mr. Barnhill's bank and the corporation's note for the loan amount was endorsed by D.V. Barnhill, Joe Barnhill, and Mr. Freeman. A mortgage on Mr. Barnhill's home property was pledged as collateral to secure the payment of the note. Mr. Barnhill also made cash loans to the corporation of $17,000 during 1975 for initial operating expenses of the corporation. All of the indebtedness was eventually repaid as the company prospered.

Mr. Freeman's father endorsed the corporation stock in favor of Mr. Freeman but no new stock certificates were issued in the names of the new purchasers. The company did business as B & F Cementing Company, a shell corporation formed to indicate Joe Barnhill's participation in the business. This corporation was later liquidated.

In 1978 Freeman Chemical and Cementing Company, Inc. redeemed Joe Barnhill's 75 shares of stock for a cash consideration of $90,000 paid by the corporation. A noncompetition agreement was executed by Joe Barnhill for an additional consideration of $60,000. In 1979 Freeman created another corporation, Bulk Cement, Inc., and some of the assets of Freeman Chemical and Cementing Company, Inc. were transferred to the new corporation for business reasons. Freeman is president of both corporations and from time to time has personally guaranteed substantial bank loans to the corporations. The business has prospered since Freeman took it over, has produced substantial income which provided the parties' living expenses during their marriage, and the business has a substantial net worth.

Both Mr. and Mrs. Freeman testified that at the time the corporate stock was acquired they were unaware of the legal requirement that an authentic act be executed in order to reestablish the community and they both assumed there was a community existing between them, that the stock was community property, and that Mrs. Freeman had an interest in the stock. Mrs. Freeman worked for a short time for the corporation in a secretarial capacity, but there is no indication in the evidence that *676 she ever took any active role in the business activities or did any other acts indicative of stock ownership.

In 1973, shortly after their reconciliation, the Freemans purchased a modest home in Huntington Park Subdivision, the consideration being $753 cash and the assumption of a $27,000 mortgage. The property was purchased in the names of both parties. In December 1975 a lot in Pecan Bayou Subdivision was purchased for $12,000 in the name of Mr. Freeman alone. A new home was built on this lot with Mrs. Freeman being primarily responsible for the building of the house, i.e., supervising the activities of architects, contractors, and workmen. A loan of $60,000 was obtained from the Monroe Building & Loan Association and both Mr. and Mrs. Freeman signed the mortgage to the building and loan company. The Huntington Park property was sold for $3,351 cash and the assumption of the mortgage by the purchasers. The Freemans lived in the new home until their separation in 1980.

According to Mr. Freeman's candid testimony he first became aware of the fact that there was no community existing between him and his wife when his lawyer advised him of that fact at the time he was purchasing the lot on which the family home was to be built. He purposely, in order to avoid his wife having an interest in the property, instructed the lawyer to make the deed out in his name alone. It was not until two or three years later that Mr. Freeman told Mrs. Freeman about the community property situation and took the position with her that she did not own any interest in the corporate business or the home.

Under Civil Code Article 155,[1]

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Bluebook (online)
430 So. 2d 673, Counsel Stack Legal Research, https://law.counselstack.com/opinion/freeman-v-freeman-lactapp-1983.