Mary Beth Bundschuh v. William P. Bundschuh

• Court: Court of Appeals of Virginia
• Decided: June 16, 1998
• Docket: 2574971
• Status: Unpublished

Opinion

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

- 2 - 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

- 3 - 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 . . . ."

- 4 - 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.

- 5 -