McKay v. McKay

989 S.W.2d 560, 66 Ark. App. 268, 1999 Ark. App. LEXIS 287
CourtCourt of Appeals of Arkansas
DecidedMay 12, 1999
DocketCA 98-888
StatusPublished
Cited by4 cases

This text of 989 S.W.2d 560 (McKay v. McKay) is published on Counsel Stack Legal Research, covering Court of Appeals of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McKay v. McKay, 989 S.W.2d 560, 66 Ark. App. 268, 1999 Ark. App. LEXIS 287 (Ark. Ct. App. 1999).

Opinions

John F. Stroud, Jr., Judge.

Appellant, Verlon McKay, and appellee, Debra McKay, were divorced by the Saline County Chancery Court on March 12, 1998. Appellant contends on appeal that the chancellor erred in finding that appellee has an equal interest in a houseboat purchased during the marriage. Appellee argues in her cross-appeal that the chancellor erred in finding that all of the money in the parties’ joint checking account and that most of the property purchased with the funds from this account are the separate property of appellant. Appellee also argues that the chancellor erred in modifying the divorce decree by setting aside her award of rehabilitative alimony and in failing to award her attorney’s fees.

When the parties married in 1991, appellee had custody of two sons from a previous marriage and was employed as a courier by Federal Express. Appellant receives veterans’ and social security disability income. When the parties married, his monthly income was increased over $100 because he had a wife and minor stepchildren. Appellant receives approximately $76,000 of tax-free income each year. Appellant deposited all of his disability income into a joint checking account to which appellee made no contribution. Appellant paid for the utilities and groceries out of this account. At trial, appellant testified that he wrote 90% of the checks on this account; he said that appellee wrote approximately 10% of the checks and that she only did so after first discussing it with him. At the time of the parties’ marriage, appellant owned a house in Little Rock and land in Saline County. After their marriage, the parties built a house on the land in Saline County. In order to finance the construction, appellant used over $60,000 of his nonmarital savings and borrowed $30,000; the parties mortgaged the house in Little Rock as security for the loan. During the marriage, this debt was repaid in full from funds in the joint checking account. When the parties separated, appellant closed out the joint checking account and kept the balance of $12,800.

During the parties’ marriage, appellant inherited approximately $35,800 from his mother. He deposited the proceeds of his inheritance into the joint checking account and used this money in the purchase of a $39,500 houseboat. Although the seller prepared the bill of sale in both parties’ names, appellant registered the boat with the State of Arkansas only in his name. He testified that he had not intended to give appellee an interest in the houseboat and that he had not objected to appellee’s name appearing on the bill of sale because she was his wife.

Appellee testified that, at appellant’s request, she changed jobs with Federal Express. For awhile, she worked part-time and later went back to full-time employment as a customer-service representative. At the time of trial, she was making $27,200 per year. Appellee stated that she assisted appellant with two multilevel marketing businesses during the marriage. Appellee testified that she did write checks on the joint account for such things as groceries and gas credit cards and that she did so without first discussing it with appellant. She also said that, during the marriage, she kept her own checking account, on which appellant did not write checks, and that she paid for a new refrigerator, stove, dishwasher, washer, and dryer. Appellant, however, testified that he paid for the washer and dryer. At trial, he produced the checks written for these items.

In the divorce decree, the chancellor found that all of the money that was in the joint checking account was the separate property of appellant because it was derived from his disability benefits and was under his control. The chancellor also found that, with the exception of the houseboat, everything purchased with the proceeds of the joint checking account was appellant’s separate property because it was purchased with his disability income. The chancellor found that, although appellant’s inheritance was used to purchase the houseboat, it was marital property because the bill of sale placed title in both parties’ names and that appellant made a gift of an interest in the boat to appellee. The chancellor found that appellee had purchased the stove, refrigerator, and dishwasher and found them to be her separate property. He also directed appellant to pay appellee $100 a week in rehabilitative alimony through the end of 1998. Upon motion by appellant, however, the chancellor set aside the award of alimony; he found that, because appellee’s pleadings did not request alimony, he was without authority to make this award.

On appeal, appellant argues that the chancellor erred in finding that appellee has an interest in the houseboat because he used the proceeds of his inheritance to purchase it and because he did not intend to make a gift of an interest in it to appellee.

Under Arkansas law, property acquired by inheritance or in exchange for such property is not marital property subject to equal division upon divorce. Ark. Code Ann. § 9-12-315(b)(1) and (2) (Repl. 1998). However, a party can destroy the nonmarital status of such property by placing it in an account held jointly with a spouse. See Jackson v. Jackson, 298 Ark. 60, 765 S.W.2d 561 (1989). Once property, whether real or personal, is placed in the names of persons who are husband and wife without specifying the manner in which they take, there is a presumption that they own the property as tenants by the entirety, and clear and convincing evidence is required to overcome that presumption. Cole v. Cole, 53 Ark. App. 140, 920 S.W.2d 32 (1996).

A presumption also arises that the spouse placing the money in a joint account intended to make a gift of an interest in this money to the other spouse. Creson v. Creson, 53 Ark. App. 41, 917 S.W.2d 553 (1996). To support a finding that such property is separate property for purposes of property distribution upon divorce, the party seeking to rebut either presumption must present clear and convincing evidence that the property was separately owned. Id. In either event, the requirement of clear and convincing evidence means that the proponent seeking to rebut the presumption must do so by proof so clear, direct, weighty, and convincing that the fact-finder is able to come to a clear conviction, without hesitation, of the matter asserted. Id. Clear and convincing evidence is that degree of proof that will produce in the fact-finder a firm conviction respecting the allegation sought to be established. Id.; see also Cole v. Cole, supra. This court’s test on review is not whether it is convinced that there was clear and convincing evidence to support the trial judge’s finding but whether it can say that the finding is clearly erroneous. Bishop v. Bishop, 60 Ark. App. 164, 961 S.W.2d 770 (1998). A finding is clearly erroneous when the reviewing court, on the entire evidence, is left with the definite and firm conviction that a mistake has been committed. Adkinson v. Kilgore, 62 Ark. App. 247, 970 S.W.2d 327 (1998). A requirement that the evidence be clear and convincing does not mean that the evidence must be uncontradicted. O’Flarity v. O’Flarity, 42 Ark. App. 5, 852 S.W.2d. 150 (1993).

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Martindale v. Estate of Martindale
110 S.W.3d 319 (Court of Appeals of Arkansas, 2003)
Office of Child Support Enforcement v. Calbert
20 S.W.3d 450 (Court of Appeals of Arkansas, 2000)
McKay v. McKay
8 S.W.3d 525 (Supreme Court of Arkansas, 2000)
McKay v. McKay
989 S.W.2d 560 (Court of Appeals of Arkansas, 1999)

Cite This Page — Counsel Stack

Bluebook (online)
989 S.W.2d 560, 66 Ark. App. 268, 1999 Ark. App. LEXIS 287, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mckay-v-mckay-arkctapp-1999.