Karrie Boomer v. Joseph Boomer

• Court: Court of Appeals of Georgia
• Decided: March 14, 2023
• Docket: A23A0393
• Status: Published

Opinion

THIRD DIVISION DOYLE, P. J., GOBEIL, J., and SENIOR APPELLATE JUDGE PHIPPS

NOTICE: Motions for reconsideration must be physically received in our clerk’s office within ten days of the date of decision to be deemed timely filed. https://www.gaappeals.us/rules

March 14, 2023

In the Court of Appeals of Georgia A23A0393. BOOMER v. BOOMER.

PHIPPS, Senior Appellate Judge.

Following a bench trial, the trial court issued a final judgment and divorce

decree to plaintiff Karrie Boomer and defendant Joseph Boomer. Karrie appeals from

the denial of her motion for a new trial, contending that: (i) the trial court erred by

concluding that a lump-sum payment of Department of Veterans Affairs (“VA”)

disability benefits received by Joseph during the parties’ marriage was non-marital

property; and (ii) the evidence did not support the court’s ruling that Karrie

misappropriated $70,935.26 from Joseph’s lump-sum payment. For the reasons that

follow, we affirm in part, reverse in part, and remand the case to the trial court for

further proceedings. On appeal from a bench trial, we view the evidence in the light most favorable

to the trial court’s rulings and defer to its credibility judgments. See Gibson v.

Gibson, 301 Ga. 622, 624 (801 SE2d 40) (2017). So viewed, the record shows that

the parties started dating in September 2015 and were married in May 2016. In June

2017, Joseph received a lump-sum award of $130,237.30 for retroactive VA disability

benefits. At the time, Karrie handled Joseph’s finances and therefore had access to

his bank account. Two days after Joseph received the lump-sum VA payment, Karrie

transferred, with Joseph’s authorization, $60,000 from Joseph’s bank account to her

separate bank account. The money was intended to be used for various expenditures

for both parties, including the purchase of $20,000 worth of stock. Ten days later,

Karrie transferred another $50,000 from Joseph’s bank account to her account, this

time without Joseph’s authorization. Karrie never returned that money to Joseph.

In March 2019, Karrie instituted this action for divorce, seeking equitable

division of the marital assets. Joseph counterclaimed, also seeking equitable division

of the marital assets and alleging that Karrie had misappropriated various funds for

which she refused to account. Following a two-day hearing, the trial court issued a

divorce decree in which it concluded, as relevant to this appeal, that Karrie

improperly appropriated $70,935.26 from Joseph’s lump-sum VA payment,

2 consisting of $20,935.26 that she deposited into an investment account over which

Joseph had no authority and $50,000 that she transferred elsewhere. The court further

concluded that those sums constituted non-marital funds and, on that basis, ordered

Karrie to pay Joseph $70,935.26 “as an equitable division of the marital property

owned by the parties.” After the trial court denied Karrie’s motion for a new trial, she

filed an application for discretionary review, which we granted. See Boomer v.

Boomer, Case No. A23D0008 (Aug. 12, 2022). This appeal followed.

1. We first address Karrie’s challenge to the trial court’s ruling that Joseph’s

lump-sum VA payment was non-marital property. Karrie primarily contends that,

under Georgia’s “analytical approach,” at least part of the award was marital property.

See, e.g., Dees v. Dees, 259 Ga. 177, 177-178 (377 SE2d 845) (1989). We discern no

error in the trial court’s ruling.

The equitable division of property is an allocation to the parties of the assets acquired during the marriage, based on the parties’ respective equitable interests. The purpose behind the doctrine of equitable division of marital property is to assure that property accumulated during the marriage be fairly distributed between the parties. Only property acquired as a direct result of the labor and investments of the parties during the marriage is subject to equitable division. A property interest brought to the marriage by one of the marriage partners is a non-marital asset and is not subject to equitable

3 division since it was in no sense generated by the marriage. It is a question of law for the court whether a particular category of property may legally constitute a marital or non-marital asset, but whether a particular item of property actually is a marital or non-marital asset may be a question of fact for the trier of fact.

Payson v. Payson, 274 Ga. 231, 231-232 (1) (552 SE2d 839) (2001) (citations and

punctuation omitted).

Although property not accumulated during the marriage and belonging to one or the other party may be taken into account in deciding questions of alimony and, indeed, the equities of the division of the marital assets, this separate property is itself not subject to division. The property which we have found to be outside the marital estate is property which is very personal to the party to whom it belongs and property which was in no sense generated by the marriage.

Campbell v. Campbell, 255 Ga. 461, 462 (339 SE2d 591) (1986).

The party seeking a division of contested property has the burden of proving

that it is a marital asset. See Dasher v. Dasher, 283 Ga. 436, 437 (1) (658 SE2d 571)

(2008); Barber v. Barber, 257 Ga. 488, 489 (3) (360 SE2d 574) (1987). “Property

does not become a marital asset simply because one of the spouses obtains it during

the course of the marriage.” Dasher, 283 Ga. at 436 (1) (citation and punctuation

omitted). Thus, for example,

4 [a] personal injury claim settlement, to the extent that it represents compensation for pain and suffering and loss of capacity is peculiarly personal to the party who receives it. . . . However, to the extent that the settlement amount represents compensation for medical expenses or lost wages during the marriage, the settlement may be considered an asset of the marriage.

Campbell, 255 Ga. at 462.

The parties have not cited, and research has not revealed, any Georgia appellate

decisions directly addressing whether some or all of a lump-sum VA disability

payment received while married may be considered a marital asset. Under federal law,

however, VA benefits “shall be exempt from taxation, shall be exempt from the claim

of creditors, and shall not be liable to attachment, levy, or seizure by or under any

legal or equitable process whatever, either before or after receipt by the beneficiary.”

38 USC § 5301 (a) (1); see also 38 USC § 101 (1) (defining “Secretary” as the

“Secretary of Veterans Affairs” and “Department” as the VA). And courts in several

other jurisdictions have determined that 38 USC § 5301 (a) (1)’s anti-attachment

clause prohibits categorizing VA disability benefits — including lump-sum

retroactive benefits — as a marital asset. See Stacy v. Stacy, 97 Mass. App. Ct. 160,

161, 165-168, 144 NE3d 899 (2020) (holding that 38 USC § 5301 (a) (1) prevents a

5 lump-sum payment for retroactive VA disability benefits from inclusion in the marital

estate for purposes of equitable distribution); Strong v. Strong, 300 Mont. 331, 333,

339-340, 8 P3d 763 (2000) (concluding that, under 38 USC § 5301 (a), a lump-sum

settlement for back disability payments awarded by the VA to the husband during his

marriage was his separate non-marital property); see also, e.g., In re Marriage of

Wojcik, 362 Ill. App. 3d 144, 159, 838 NE2d 282 (2005) (because 38 USC § 5301 (a)

(1) exempts VA disability benefits from any legal process, they “may not be divided

directly or used as a basis for an offset” during divorce proceedings); In re Marriage

of Howell, 434 NW2d 629, 633 (II) (Iowa 1989) (under former 38 USC § 3101, the

predecessor to 38 USC § 5301, veteran’s disability benefits “are statutorily exempt

from all claims other than claims of the United States, and are not divisible or

assignable” in divorce actions); Gray v. Gray, 1996 OK 84, 922 P2d 615, 617, 619

(I) (1996) (the husband’s VA disability benefits “were his own separate property”

under 38 USC § 5301 (a)); Griffith-Ball v. Ball, No. M2020-00509-COA-R3-CV,

2022 Tenn. App. LEXIS 186, at *8-9 (II) (A) (May 13, 2022) (38 USC § 5301 (a) (1)

“generally prevents dividing VA disability benefits as marital property” in a divorce);

Pfeil v. Pfeil, 115 Wis. 2d 502, 505-506, 341 NW2d 699 (1983) (under the

predecessor to 38 USC § 5301, VA disability benefits “are not to be divided between

6 spouses in a divorce action and not to be made the basis for an offsetting or

compensatory award to the spouse of the disabled veteran receiving the service-

connected disability award”); but see In re Marriage of Landis, 200 Ore. App. 107,

111-112, 113 P3d 456 (2005) (concluding, without addressing 38 USC § 5301, that

federal law does not preclude the division of lump-sum veterans’ disability benefits

upon divorce).

Because we find those decisions to be persuasive, we hold that the trial court

properly concluded that Joseph’s VA disability benefits award was non-marital

property and affirm its ruling in that regard. As our ruling on this issue rests on

federal law, we need not address Karrie’s contention that application of Georgia’s

“analytical approach” would lead to a different result, pretermitting whether it would

apply here absent controlling federal law. And while Karrie also argues that the

federal Uniformed Services Former Spouses’ Protection Act, 10 USC § 1408, does

not expressly bar inclusion of Joseph’s award in the marital estate, that issue is

irrelevant to our analysis, given our ruling that division of the benefits is

independently barred by 38 USC § 5301 (a) (1).1

1 See, e.g., Strong, 300 Mont. at 334-340; see also generally Phillips v. Phillips, 347 Ga. App. 524, 528-529 (3) (820 SE2d 158) (2018) (explaining that 10 USC § 1408 exempts from inclusion in marital property the amount of a veteran’s

7 2. Karrie also contends that the evidence was insufficient to support the trial

court’s finding that she misappropriated $70,935.26 from Joseph’s lump-sum

payment. We agree in part, insofar as the evidence showed that Karrie

misappropriated only $50,000 from Joseph’s separate assets.

“In the appellate review of a bench trial, we will not set aside the trial court’s

factual findings unless they are clearly erroneous, and this Court properly gives due

deference to the opportunity of the trial court to judge the credibility of the witnesses.

But when a question of law is at issue, we review the trial court’s decision de novo.”

Spruell v. Spruell, 356 Ga. App. 722, 724 (848 SE2d 896) (2020) (citation and

punctuation omitted). Joseph’s testimony that Karrie withdrew $50,000 from his bank

account and kept it without his authorization — which was corroborated by the

parties’ bank statements showing the $50,000 withdrawal and corresponding deposit

— was sufficient to support the trial court’s finding to that effect, which we therefore

affirm. See id.

The trial court’s finding that Karrie misappropriated an additional $20,935.26,

however, is another matter. Joseph testified that the $60,000 he authorized Karrie to

retirement income that the government deducts due to a waiver of such income that the veteran must make to receive disability benefits, a situation not present here).

8 withdraw included $20,000 that was to be invested in stocks. And Karrie similarly

testified that she deposited $20,000 from the money Joseph authorized her to

withdraw into “a joint investment account.” She further testified that she withdrew

“approximately half” of the money in the investment account in 2018, when she

retained an attorney and “bought a couple [of] things.”2

That evidence was sufficient to show only that Joseph made a gift of $20,000

to the marital estate for the parties’ joint use and/or investment, and not that Karrie

had no right to the money. Moreover, our review of the record reveals no basis for the

trial court’s addition of $935.26 to the $20,000 that Joseph testified he authorized

Karrie to invest in stocks. Consequently, we reverse the trial court’s ruling that Karrie

misappropriated $20,935.26 of Joseph’s assets and remand this case for the trial court

to, at a minimum: (i) re-calculate the marital estate subject to equitable division by

including in the estate the $20,000 earmarked for investing in stocks; (ii) explain the

basis, if any, for its addition of $935.26 to that amount; and (iii) make a new ruling

on the equitable division of the re-calculated marital estate. See Payson, 274 Ga. at

2 Two brokerage account statements admitted into evidence show that an investment account in Karrie’s name had a balance of $15,850.15 on March 31, 2019 (three days after Karrie filed for divorce), and $0 on July 31, 2019. Evidence admitted during the bench trial did not establish whether this account was the same “joint investment account” discussed in Karrie’s testimony.

9 233 (1) (b) (explaining that (i) an appellate court’s “invalidation of a portion of the

factfinder’s allocation of marital property works a change in matter of substance

regarding the allocation of marital property and requires the factfinder to re-examine

its equitable division of marital property”; and (ii) thus, “even if the error is limited

to one item of property, the factfinder’s allocation of economic resources must be

determined de novo” because “a party’s non-marital property is a factor that may be

considered in assessing the equities of the division of marital property”) (citation and

Our ruling is not intended to limit the scope of the trial court’s inquiry on

remand, insofar as any additional issues may be relevant to the equitable division of

the re-calculated marital estate, including the extent to which Karrie may have

withdrawn marital assets in the investment account during the pendency of this

divorce.3 See generally Mallard v. Mallard, 297 Ga. 274, 278 (773 SE2d 274) (2015)

(“[T]he equitable division of marital property is at the discretion of the trier of fact,

and such discretion is broad. So too, an equitable division of marital property does

not necessarily mean an equal division, but rather a fair one, and in making such

determination, the trier of fact should consider all of the relevant circumstances.”)

3 See note 2, above.

10 (citation omitted). It is for the trial court to determine, after consulting with the

parties, whether additional briefing, an additional hearing, or both may be warranted

to comply with our directives.

Judgment affirmed in part and reversed in part, and case remanded with

direction. Doyle, P. J., and Gobeil, J., concur.