IN THE COURT OF APPEALS OF THE STATE OF MISSISSIPPI
NO. 2023-CA-00875-COA
ROBERT THOMAS ELMORE APPELLANT
v.
RACHAEL BELL BEARD ELMORE APPELLEE
DATE OF JUDGMENT: 05/31/2023 TRIAL JUDGE: HON. CYNTHIA L. BREWER COURT FROM WHICH APPEALED: MADISON COUNTY CHANCERY COURT ATTORNEY FOR APPELLANT: JOHN G. HOLADAY ATTORNEY FOR APPELLEE: DAVID BRIDGES NATURE OF THE CASE: CIVIL - DOMESTIC RELATIONS DISPOSITION: AFFIRMED - 04/22/2025 MOTION FOR REHEARING FILED:
BEFORE BARNES, C.J., WESTBROOKS AND WEDDLE, JJ.
WEDDLE, J., FOR THE COURT:
¶1. After Robert Elmore and Rachael Elmore each sought a divorce on contested grounds,
the parties filed a joint consent to divorce on the ground of irreconcilable differences and
reserved the contested issues of equitable division, alimony, and attorney’s fees for the
chancellor to decide. On May 10, 2023, the Madison County Chancery Court entered its
opinion granting the parties a divorce and dividing the marital property, and the court’s final
judgment was entered on May 31, 2023, after a status conference was held regarding proof
of value. Aggrieved, Robert appeals. Finding no error, we affirm.
FACTS
¶2. Robert and Rachael were married on August 10, 2010. The parties separated in January 2020 and had no children together.1 On September 30, 2020, Robert filed a
complaint for divorce on the grounds of uncondoned adultery and habitual cruel and inhuman
treatment. On January 6, 2021, before Robert served Rachael with process, Rachael filed a
complaint for divorce on the grounds of habitual cruel and inhuman treatment and habitual
drunkenness. Prior to trial, the chancellor consolidated the causes, determined February 9,
2021, to be the valuation date for marital property, and approved the parties’ voluntary
consent to divorce and stipulation of issues to be tried. Robert disputed the chancellor’s
classification of the following assests: RTE Properties LLC, Promissory Notes 2702 and
2709, TBCB Properties LLC, and real and personal property.
RTE Properties LLC
¶3. Prior to the marriage and until 2020, Robert worked at Eutaw Construction Company
Inc., a construction business owned by his father, Tom Elmore. In 2004, prior to the
marriage, when Tom decided to move his construction business, he and Robert formed
Elmore Elmore LLC, with ownership designated as 50% RTE Properties LLC and 50%
Elmore Properties Inc. (Tom’s business). In 2009, Elmore Elmore LLC acquired land and
built a building that Eutaw Construction Company Inc. moved into that same year. When
Robert parted ways with Eutaw Construction in 2020, Elmore Elmore LLC was dissolved,
and Robert retained his interest in RTE Properties. The chancellor found that RTE Properties
was marital property valued at $522,002.07.
Promissory Notes 2702 and 2709
1 Robert had two children from a previous relationship.
2 ¶4. In 2005, Tom had sold to his daughter and Robert 17% of his ownership interest in
Eutaw Construction, totaling 1,508 shares. Until 2019, Robert made periodic payments
totaling $190,590.23 toward the purchase price of the shares. In 2012, Tom entered into an
Employee Stock Ownership Plan (ESOP) agreement with the employees of Eutaw
Construction, which required all stockholders, including Robert, to exchange their stock for
promissory notes.2 In the agreement, Robert, as the payee, received quarterly payments from
the ESOP transaction. In 2019, Robert paid the remaining balance of $877,073.87 to Tom
for what he owed for the 1,508 shares of the Eutaw Construction stock. During the divorce
proceedings, Robert entered into a contract with Tom for the sale of Promissory Notes 2702
and 2709 for $4.2 million. The chancellor ruled the two promissory notes were marital
property.
TBCB Properties LLC
¶5. After Tom entered into the ESOP agreement, he formed TBCB Properties LLC
(TBCB) with others, including Robert, in 2012. A member later sold his ownership interest
back to TBCB, which increased Robert’s ownership interest to 17.4%. TBCB owned five
properties throughout the marriage. As of February 9, 2021, the date of demarcation, the
business owned two pieces of property appraised at $1,428,820.00. The chancellor found that
Robert’s 17.4% ownership interest was valued at $258.010.68, and because TBCB was
formed during the marriage, his business interest was marital property.
Real Property
2 Tom testified that the promissory notes were “re-amortized in 2017, but they were created in 2012.”
3 ¶6. During the marriage, the parties acquired interests in real property, including the
marital home, an undeveloped lot in Alabama, and a timeshare in Colorado. No other
evidence was heard as to additional real property the parties owned as of the demarcation
date.3 Both parties classified the marital home in Madison, Mississippi, as marital property.
After considering the evidence and hearing testimony from witnesses, the chancellor
assigned the marital home a value of $1,550,000.00, with a total marital equity in the amount
of $297,590.66.
¶7. Following the trial, the chancellor determined which assets were subject to equitable
division and distributed the property accordingly. Aggrieved, Robert appeals this ruling.
STANDARD OF REVIEW
¶8. “This Court applies a limited standard of review to a chancellor’s division and
distribution of marital property. A [chancellor’s] findings of fact will not be disturbed unless
[the chancellor’s] actions were manifestly wrong, [the chancellor] abused [her] discretion,
or [the chancellor] applied an erroneous legal standard. The chancellor’s division and
distribution will be upheld if it is supported by substantial credible evidence.” Warner v.
Warner, 341 So. 3d 152, 159 (¶21) (Miss. Ct. App. 2022) (citations omitted).
DISCUSSION
¶9. Robert argues that the chancellor (1) erred by not properly considering and analyzing
elements necessary for the equitable distribution of marital assets, (2) erred in making her
3 The chancellor ordered the sale of a condo in Starkville, Mississippi, and a condo in Nashville, Tennessee, with combined net proceeds of $272,747.25 to be deposited into the chancery court’s registry.
4 determination of which assets were marital and which were non-marital, and (3) erred when
she assessed the value of certain assets, specifically the Promissory Notes 2702 and 2709.
To equitably distribute marital property, the chancellor must “(1) classify the parties’ assets
as marital or separate, (2) value those assets, and (3) equitably divide the marital assets.”
Gilmer v. Gilmer 297 So. 3d 324, 335 (¶33) (Miss. Ct. App. 2020) (citing Randolph v.
Randolph, 199 So. 3d 1282, 1285 (¶11) (Miss. Ct. App. 2016)). In equitably distributing
marital assets, the chancellor must apply the following factors established by the Mississippi
Supreme Court in Ferguson v. Ferguson, 639 So. 2d 921 (Miss. 1994): (1) the contribution
to the accumulation of property; (2) the dissipation or prior distribution of assets; (3) the
market and emotional value of the assets subject to distribution; (4) the value of assets not
subject to distribution; (5) the tax and economic consequences of the distribution; (6) the
extent to which property division may eliminate the need for alimony; (7) the financial-
security needs of the parties; and (8) any other factor that in equity should be considered. Id.
at 928.
I. Classification of Assets
¶10. All assets earned or accrued during the course of the marriage are presumed to be
marital property. Bullock v. Bullock, 218 So. 3d 265, 271 (¶18) (Miss. Ct. App. 2017) (citing
Hemsley v. Hemsley, 639 So. 2d 909, 914 (Miss. 1994)). However, an asset may be classified
as nonmarital if it is accrued by means of one spouse’s separate funds. Id. (citing Ferguson,
639 So. 2d at 929). The burden of proof is on the spouse claiming property is separate to
rebut this presumption. Rhodes v. Rhodes, 52 So. 3d 430, 441 (¶42) (Miss. Ct. App. 2011).
5 The “burden goes beyond a mere demonstration that the asset was acquired prior to
marriage.” Cassell v. Cassell, 389 So. 3d 305, 311 (¶12) (Miss. 2024).
A. Classification of Promissory Notes 2702 and 2709
¶11. In his first assignment of error, Robert contends that the trial court erred when it
classified Promissory Notes 2702 and 2709 as marital assets.4 Prior to the marriage, Robert
agreed to purchase from Tom an ownership interest in Eutaw Construction for
$1,067,664.10. Robert paid $190,590.23 toward the purchase price before he and Rachael
married, but he paid the remaining balance of $877,073.87 during the marriage. Tom testified
that as the majority stockholder, he made the ultimate decisions. Nonetheless, in 2012,
Robert agreed to sell his Eutaw Construction stock as part of the ESOP agreement in
exchange for the two promissory notes.5 The chancellor found that when Robert used marital
funds to pay Tom the remaining balance on the Eutaw Construction stock in 2019 and also
agreed to exchange his stock for two promissory notes during the marriage, the notes became
4 Notably, during the course of the trial, Robert sold these two promissory notes after the chancellor ordered the parties “not to deplete, sell, assign, transfer, dispense with any asset accumulated by the parties, either jointly or individually during the course of the marriage, except in the ordinary course of business.” Robert sold the notes to Tom for less than what the chancellor determined to be the value as of the demarcation date, arguing that the notes were sold in the ordinary course of business. 5 The dissent correctly points out that property acquired by a spouse in exchange for separate property retains its character as separate property. Deborah H. Bell, Bell on Mississippi Family Law § 6:04[1], at 155 (3d ed. 2020). However, “[a]cquisition occurs as payment is made and equity is created.” Id. at § 6.02[4][b]. Here, Robert did not make the final payment toward the purchase price of the stock until 2019 (after the parties were married).
6 marital property.6
¶12. “It is incumbent upon the parties, and not the chancellor, to prepare evidence touching
on matters pertinent to the issues to be tried.” Cannon v. Cannon, 375 So. 3d 697, 711 (¶45)
(Miss. Ct. App. 2023). The burden was on Robert to provide evidence to the court to
establish that the promissory notes were not marital property. See id. at 710 (¶44). The assets’
appreciation is demonstrated by the fact that the promissory notes were valued at
$6,389,371.55 as of the demarcation date and that Robert sold them for $4,200,000.00, which
was significantly more than the purchase price. This Court has held that marital property
includes the appreciation of an asset resulting from either spouse’s active efforts during the
marriage. Craft v. Craft, 825 So. 2d 605, 609 (¶14) (Miss. 2002). The promissory notes were
acquired during the parties’ marriage through Robert’s efforts. Accordingly, we find that the
chancellor did not err in her classification of Promissory Notes 2702 and 2709 as marital
B. Classification of Interest in TBCB
¶13. As another assignment of error, Robert alleges that the chancellor erred when she
determined that his ownership interest in TBCB was marital property subject to equitable
distribution. Although it is undisputed that TBCB was formed during the marriage, Robert
contends that he obtained his interest in TBCB as a result of his pre-marital ownership of the
Eutaw stock. This Court has held that “[a]ssets acquired or accumulated during the course
of a marriage are subject to equitable division unless it can be shown by proof that such
6 The chancellor took into consideration the premarital funds Robert used toward the purchase price in its Ferguson analysis.
7 assets are attributable to one of the parties’ separate estates prior to the marriage or outside
of the marriage.” Warner, 341 So. 3d at 160 (¶23) (quoting Williams v. Williams, 303 So. 3d
824, 833 (¶33) (Miss. Ct. App. 2020)). “[T]here is generally a presumption that property
acquired during the marriage is marital property.” Cassell, 389 So. 3d at 310-11 (¶12)
(quoting Yancey v. Yancey, 752 So. 2d 1006, 1011 (Miss. 1999)). “[T]he party seeking to
classify property as separate, or non-marital, bears the burden of tracing the asset to a
separate-property source.” Allgood v. Allgood, 62 So. 3d 443, 447 (¶13) (Miss. Ct. App.
2011).
¶14. In support of Robert’s claim that TBCB was separate property, he offered testimony
that TBCB was created during the time Eutaw Construction was sold with the ESOP
agreement and was part of the ESOP transaction. Robert essentially re-urges that his interest
in Eutaw Construction became his interest in the promissory notes; therefore, because TBCB
was created as a result of his interest in Eutaw Construction, according to Robert, TBCB is
not marital property. However, Robert did not provide any evidence to support his claim that
TBCB was formed as a result of the ESOP agreement. The chancellor, after considering
witness testimony, determined that Robert did not rebut the presumption that the business
interest is marital property. We agree. A review of the record reflects that Robert failed to
meet his burden, and without sufficient evidence to overcome the presumption, the
chancellor was obligated to find that the interest in TBCB was marital property. See Cannon,
375 So. 3d at 711 (¶47). Accordingly, we find that the chancellor was not erroneous in her
classification of the interest in TBCB.
8 C. Classification of Interest in RTE Properties
¶15. In Robert’s next assignment of error, he argues that the chancellor erred in classifying
RTE Properties as marital property. Although Robert formed RTE Properties in 2004, the
chancellor found that by using marital funds to pay RTE Properties’ debts, the asset’s
character changed from non-marital to marital. When Robert left Eutaw Construction
Company Inc. in 2020, he and his father dissolved Elmore Elmore LLC, and RTE Properties
became the sole owner of the two buildings and land, thereby assuming the debt obligations
associated with Elmore Elmore LLC. The record shows that Robert refinanced significant
debt associated with the land in March 2021. When Eutaw Construction Company Inc.
vacated the buildings in April 2020, they remained vacant until November 2021, when
Robert leased both buildings and began collecting rent. Robert used his stock payments and
a $400,000.00 severance pay to make the note payments and negotiated with the bank for
more time. All of this business was conducted during the marriage.
¶16. Robert testified that during the marriage, he used funds from his personal account to
pay on the loans for RTE Properties. He argues that because his only source of funds during
this time period was from the ESOP transaction, the payment on the loan did not convert
RTE Properties to marital property. “A business interest owned prior to marriage is the
separate property of the owning spouse, at least to the extent of its value at the time of the
marriage.” Smith v. Smith, 379 So. 3d 954, 965 (¶34) (Miss. Ct. App. 2024) (quoting Dean
v. Dean, 304 So. 3d 156, 166 (¶35) (Miss. Ct. App. 2020)). “Appreciation of a separate
business interest, which occurs during the marriage and is attributable to the efforts of either
9 spouse is marital property.” Id. In addition to the fact that Robert offered no testimony or
evidence as to the source of the funds to pay the loan, only that he did not have significant
income during this period of time, we find the chancellor made no reversible error by
classifying the promissory notes as marital property. Therefore, we find that the chancellor
did not err in classifying the interest in RTE Properties as marital property.
D. Classification of Personal Property within the Marital Home
¶17. Next, Robert submits that the chancellor erred when she awarded Rachael all the
personal property within the marital home. Robert claims that certain personal property in
the marital home, including personal property he owned prior to the marriage that belonged
to his daughter, was not subject to equitable distribution. There is a rebuttable presumption
that all property is marital, and the burden of showing otherwise rests with the spouse
claiming the property as non-marital. Brown v. Brown, 350 So. 3d 1169, 1178 (¶32) (Miss.
Ct. App. 2022) (citing Neely v. Neely, 305 So. 3d 164, 168 (¶14) (Miss. Ct. App. 2020)).
Robert failed to specify, and the record does not reflect, what personal property he believes
was not subject to equitable distribution.
¶18. In her final judgment, the chancellor determined which property was marital, valued
the property, and made a distribution. Robert argues that the division of the personal property
was inequitable and unjust. Again, “[i]t is within the chancery court’s authority to make an
equitable division of all jointly acquired real and personal property. This Court reviews a
chancery court’s division of marital assets for an abuse of discretion. We will not reverse a
chancery court’s distribution of assets absent a finding that the decision was manifestly
10 wrong, clearly erroneous, or an erroneous legal standard was applied.” Garner v. Garner,
343 So. 3d 1097, 1103 (¶31) (Miss. Ct. App. 2022) (citations omitted). After review, we find
that the chancellor did not abuse her discretion, and we affirm the chancellor’s classification
and distribution of personal property in the marital home.
II. Application of Factors Relating to the Equitable Distribution of the Parties’ Assets
¶19. Robert also contends that the chancellor erred in her analysis of the Ferguson factors.
Specifically, he argues that the chancellor failed to properly consider many of the subject
factors and that her weighing of the factors was not properly supported by the record. When
“reviewing a chancellor’s judgment [in property division,] this Court does not conduct a
Ferguson analysis anew, but reviews the judgment to ensure that the chancellor followed the
appropriate standards and did not abuse [her] discretion.” Goellner v. Goellner, 11 So. 3d
1251, 1264 (¶45) (Miss. Ct. App. 2009) (quoting Phillips v. Phillips, 904 So. 2d 999, 1001
(¶8) (Miss. 2004)). It is important to note that our review of the chancellor’s final judgment
reveals that she conducted a thorough and deliberate consideration of each Ferguson factor
and reached a conclusion on each applicable factor. We now address the individual factors
Robert disputes.
¶20. Robert alleges that the chancellor failed to give him credit for his role in the
accumulation of a majority of the assets during the marriage. A review of the record and the
chancellor’s final judgment reveals that this allegation lacks merit. As the chancellor notes
throughout her final judgment, it is undisputed which assets Robert acquired. He further
alleges that the chancellor “adopted wholesale the testimony of Rachael over that of
11 [Robert].” Our Supreme Court has held that “[t]he chancellor, by [her] presence in the
courtroom, is best equipped to listen to witnesses, observe their demeanor, and determine the
credibility of the witnesses and what weight ought to be ascribed to the evidence given by
those witnesses.” Mabus v. Mabus, 890 So. 2d 806, 819 (¶56) (Miss. 2003) (citing Rogers
v. Morin, 791 So. 2d 815, 826 (Miss. 2001)).
¶21. Robert also alleges the chancellor should have found the following factors favored
him: contribution to the stability and harmony of the marital and family relationships;
contribution to the education, training, or other accomplishments bearing on the earning
power of the spouse accumulating the assets; the degree to which each spouse has expended,
withdrawn, or otherwise disposed of marital assets and any prior distribution of such assets
by agreement, decree, or otherwise; the market value and the emotional value of the assets;
the value of the assets not ordinarily, absent equitable factors to the contrary, subject to such
distribution, such as property brought to the marriage by the parties and property acquired
by inheritance or inter vivos gift or to an individual spouse; and tax and other economic
consequences, to third parties of the proposed distribution. The chancellor’s decision was
based on the testimony of the parties and their credibility as determined by the court, and we
will not reweigh that credibility. Barnett v. Oathout, 883 So. 2d 563, 566 (¶6) (Miss. 2004).
Thus, we find the chancellor followed the appropriate standards in her application of each
Ferguson factor and did not abuse her discretion.
A. Determination of the Value of the Promissory Notes 2702 and 2709
¶22. Robert argues that the trial court erred in its determination of the value of the
12 Promissory Notes 2702 and 2709. Robert also maintains that the chancellor should not have
found the two promissory notes were marital property subject to equitable distribution.
Again, we find no reversible error in the chancellor’s classification of the two promissory
notes as marital property.
¶23. The chancellor determined that the notes were valued at $2,523,839.95 for Promissory
Note 2702 and $3,865,531.60 for Promissory Note 2709. “The valuation of property is a
question of fact.” Brown, 350 So. 3d at 1179 (¶32) (citing Williams, 303 So. 3d at 833 (¶35)).
“Property division should be based upon a determination of fair market value of the assets,
and these valuations should be the initial step before determining division.” Jenkins v.
Jenkins, 67 So. 3d 5, 13 (¶19) (Miss. Ct. App. 2011) (quoting King v. King, 946 So. 2d 395,
403 (¶20) (Miss. Ct. App. 2006)). In the case before us, the chancellor noted in her final
judgment that “[t]he parties disagreed on the value of the asset and presented testimony and
evidence in support of their position. Rachael offered the expert testimony of Kenny Parker
to support her claim as to the value. . . . [Robert] disputed Kenny Parker’s valuation but
presented neither expert testimony to rebut . . . nor caselaw to support his position.” Further,
the chancellor’s opinion reflects that she used the value of the promissory notes presented
at trial and made a determination that is supported by substantial credible evidence. This
Court has declined to find that the chancellor abused her discretion if the parties failed to
present evidence of value. See id.; see also Common v. Common, 42 So. 3d 59, 63 (¶13)
(Miss. Ct. App. 2010). Therefore, we find that the chancellor made no reversible error in her
determination of the value of Promissory Notes 2702 and 2709.
13 B. Award of the Marital Home to Rachael
¶24. Robert next submits that the chancellor erred when she awarded the marital home
solely to Rachael. After applying the Ferguson factors, the chancellor awarded Rachael the
exclusive use, possession, and ownership of the marital home, which was valued at
$297,590.66 after considering the mortgages. In her opinion, the chancellor noted that Robert
made mortgage payments on the marital home during the course of the marriage. However,
the chancellor also recognized that “[w]hile [Robert] earned significantly more income,
Rachael provided significantly more support within the home.” Rachael testified at length
about her contributions to the household at the beginning of their marriage, including getting
Robert’s children ready for school, shopping for groceries, cooking, cleaning, planning the
children’s birthday parties, et cetera. This Court has held that we “assume for divorce
purposes that the contributions and efforts of the marital partners, whether economic,
domestic[,] or otherwise[,] are of equal value.” Faerber v. Faerber, 150 So. 3d 1000, 1007
(¶21) (Miss. Ct. App. 2014). Therefore, we find that the chancellor’s award of the marital
home to Rachael was not manifestly wrong or clearly erroneous and was supported by
substantial credible evidence.
C. Award of the Timbers Timeshare Condominium in Colorado
¶25. Robert asserts that the chancellor erred when she awarded Rachael the exclusive use,
ownership, and possession of their timeshare at the Timbers Condominium in Colorado
without applying a credit for Robert against the amounts he paid after the trial. Both parties
admitted the Timbers timeshare in Colorado is marital property valued at $50,000.00, less
14 the annual maintenance fee. After accounting for the yearly assessment fee, the chancellor
valued the timeshare at $36,000.00. From the trial date until the chancellor’s ruling, Robert
made payments on the timeshare totaling $9,226.44, which he believes should be credited
against his property division payments. We have consistently found that “in the absence of
meaningful argument and citation of authority, appellate courts generally will not consider
the assignment of error.” Mazie v. Boozier-Mazie, No. 2023-CA-00470-COA, 2024 WL
4354009, at *5 (¶21) (Miss. Ct. App. Oct. 1, 2024) (quoting Patton v. State, 109 So. 3d 66,
75 (¶22) (Miss. 2012)). Robert did not support his assertion with authority; therefore, this
issue is procedurally barred.
D. Award of the LPL Financial Accounts
¶26. The chancellor awarded Rachael two accounts with LPL Financial valued at a
combined $58,610.00. Robert alleges that this award was erroneous, arguing the accounts
accrued because of him over the course of his employment at Eutaw Construction, which
began before he was married to Rachael. For the purposes of dividing marital property,
retirement plans are considered marital assets. See Coggin v. Coggin, 837 So. 2d 772, 775
(¶5) (Miss. Ct. App. 2003). This Court has found that when there is no evidence presented
to show the value at the time of the separation and the value prior to the marriage, we will
find no error in the chancellor’s finding, as “fairness was the prevailing guideline in this
marital division.” Stewart v. Stewart, 2 So. 3d 770, 775 (¶14) (Miss. Ct. App. 2009). We find
the chancellor’s award of the LPL Financial accounts to Rachael was not manifestly wrong
or clearly erroneous and was supported by substantial credible evidence.
15 E. Classification of Engagement Ring Purchased after the Marriage
¶27. Robert argues that the chancellor erred in determining that the engagement ring he
bought for Rachael was separate property. Specifically, he alleges that since the ring was
purchased four years into the marriage, the ring should have been classified as marital
property subject to equitable distribution. The chancellor held that the engagement ring was
a gift to Rachael and, therefore, was separate property not subject to equitable distribution.
This Court has held that gifts of jewelry between spouses, even if acquired during the
marriage with marital assets, are personal gifts and are the separate personal property of the
donee. Fleishhacker v. Fleishhacker, 39 So. 3d 904, 914 (¶48) (Miss. Ct. App. 2009). After
review, we find the chancellor’s award of the engagement ring to Rachael was not manifestly
wrong or clearly erroneous and was supported by substantial credible evidence.
III. Denial of Motion for New Trial or to Alter or Amend
¶28. In Robert’s final assignment of error, he asserts that the chancellor erred when she
denied his Rule 59 motion for a new trial or, in the alternative, to “open the judgment,” take
additional testimony, and alter or amend the final judgment. See M.R.C.P. 59. This Court
reviews the denial of a Rule 59 motion for an abuse of discretion. Gossett v. Gossett, 313 So.
3d 1063, 1073 (¶33) (Miss. Ct. App. 2021) (citing Miller v. Smith, 229 So. 3d 148, 154 (¶27)
(Miss. Ct. App. 2016)). “A party may only obtain relief on a Rule 59 motion upon showing:
(1) ‘an intervening change in controlling law,’ (2) ‘availability of new evidence not
previously available,’ or (3) the ‘need to correct a clear error of law or to prevent manifest
injustice.’” Id. (quoting Miller, 229 So. 3d at 154-55 (¶27)). Under Rule 59, the chancellor
16 has discretion to grant a new trial or to amend the judgment “if convinced that a mistake of
law or fact has been made, or that injustice would attend allowing the judgment to stand.”
Id. (quoting McNeese v. McNeese, 119 So. 3d 264, 272 (¶20) (Miss. 2013)). Robert failed
to meet any of the requirements to obtain relief on a Rule 59 motion. Consequently, we find
the chancellor did not abuse her discretion when she denied his motion.
¶29. Additionally, Robert produced a sworn “Matrimonial Agreement” in which Rachael
allegedly acknowledged that the disputed Eutaw Construction stock was Robert’s separate
asset. He argues that the chancellor erred by refusing to consider the newly discovered
evidence and alter or amend her finding that Promissory Notes 2702 and 2709, which
originated from Robert’s Eutaw Construction stock, were marital property. The chancellor
found that Robert failed to meet his burden of proof regarding the Matrimonial Agreement,7
and we agree. This Court has stated that a motion for a new trial under Rule 59 based on
newly discovered evidence “is an extraordinary motion, and the requirements of the rule must
be strictly met.” Smullins v. Smullins, 77 So. 3d 119, 125 (¶23) (Miss. Ct. App. 2011). “A
party cannot fail to investigate important information and then attempt to assert that
information as new evidence at the end of the trial.” Id. at 127 (¶34) (quoting Goode v.
Synergy Corp., 852 So. 2d 661, 664 (¶12) (Miss. Ct. App. 2003)). The chancellor correctly
pointed out that Robert knew about the agreements but never mentioned them, never offered
them into evidence, and never showed that the evidence was unavailable at the time of trial.
After review, we find the chancellor did not abuse her discretion when she denied Robert’s
7 The chancellor acknowledged another document Robert alleged the parties signed, titled “Agreement to Terminate Matrimonial Agreement.”
17 motion for a new trial or to alter or amend the judgment.
CONCLUSION
¶30. We find the chancellor did not err in the classification and distribution of marital
assets. We also find that the chancellor did not abuse her discretion in denying Robert’s
motion for a new trial or to alter or amend the judgment.
¶31. AFFIRMED.
BARNES, C.J., CARLTON, P.J., WESTBROOKS, McDONALD, LAWRENCE, McCARTY AND EMFINGER JJ., CONCUR. WILSON, P.J., CONCURS IN PART AND DISSENTS IN PART WITH SEPARATE WRITTEN OPINION. ST. PÉ, J., NOT PARTICIPATING.
WILSON, P.J., CONCURRING IN PART AND DISSENTING IN PART:
¶32. For the reasons discussed below, I would hold that the chancellor erred by classifying
the ESOP promissory notes and Robert’s interest in TBCB as marital property. I would
reverse the chancellor’s property division and remand for further proceedings. Accordingly,
I respectfully dissent in part.
Eutaw Construction Shares/ESOP Promissory Notes
¶33. In 2005—five years before Robert married Rachael—Robert’s father, Tom, gave
Robert 1,508 shares of Eutaw Construction stock, a seventeen percent interest in the
company. In exchange, Robert executed a promissory note for $1,067,664. In or around
2005, Robert received additional shares for no additional payment when another shareholder
left the company. When Robert married Rachael in August 2010, Robert owed Tom
$877,073.87 on the promissory note. Thus, Robert paid about $190,000 in principal on the
note before he married Rachael. In January 2011, Robert made another $70,000 payment on
18 the note. Robert testified without contradiction that he made the payment directly from a
distribution he received as a Eutaw shareholder. In 2012, Eutaw created an employee stock
ownership program (ESOP), and the company’s owners, including Robert, sold their shares
to the ESOP. In return for their shares, Robert and other shareholders received promissory
notes from the ESOP. Thereafter, Robert used payments he received on his ESOP
promissory notes (Nos. 2702 and 2709) to continue making payments to Tom on the 2005
promissory note. As part of a 2019 transaction with Tom, Robert agreed to pay Tom the
remaining balance on the 2005 promissory note. Robert paid off the 2005 note with the
proceeds of a loan from Trustmark. Trustmark required Robert to direct deposit payments
he received on his ESOP notes into a Trustmark savings account, which Trustmark then
automatically debited for Robert’s payments on the Trustmark loan. Finally, in 2021—after
the entry of a temporary order in this case, which the chancellor used as the date of
demarcation8—Robert sold his ESOP promissory notes to Tom for $4,200,000. Robert used
some of the proceeds to pay off the remaining balance on the Trustmark loan ($521,949.21).
Thus, Robert’s original (2005) debt to Tom was eventually repaid from a combination of
Eutaw shareholder distributions, payments Robert received from the ESOP promissory notes,
and proceeds from Robert’s 2021 sale of the ESOP promissory notes.
¶34. Regarding a business interest owned prior to a marriage, this Court has stated:
“A business interest owned prior to marriage is the separate property of the owning spouse, at least to the extent of its value at the time of the marriage.”
8 Cuccia v. Cuccia, 90 So. 3d 1228, 1233 (¶8) (Miss. 2012) (“[A] temporary support order may serve as a line of demarcation in determining whether property is marital or separate.”).
19 Deborah H. Bell, Bell on Mississippi Family Law § 8.03[2] (citing Craft v. Craft, 825 So. 2d 605, 609 (¶14) (Miss. 2002)). Appreciation of a separate business interest, which occurs during the marriage and is attributable to the efforts of either spouse, is marital property. Id. at § 8.03[3][b] (citing Craft, 825 So. 2d at 609 (¶14)). The burden of proof is on the non-owning spouse to show both the appreciation in value of the separate business interest and that such appreciation was attributable to the efforts of either spouse. Waring v. Waring, 747 So. 2d 252, 256 (¶18) (Miss. 1999).
Dean v. Dean, 304 So. 3d 156, 166 (¶36) (Miss. Ct. App. 2020) (quoting Kimbrough v.
Kimbrough, 76 So. 3d 715, 720 (¶22) (Miss. Ct. App. 2011)). “Appreciation that is merely
passive and not a result of either spouse’s active efforts remains separate property.” Rhodes
v. Rhodes, 52 So. 3d 430, 436 (¶20) (Miss. Ct. App. 2011). In addition, property acquired
by a spouse in exchange for separate property retains its character as separate property.
Deborah H. Bell, Bell on Mississippi Family Law § 6:04[1], at 155 (3d ed. 2020).
¶35. Here, Robert acquired his Eutaw shares five years before he married Rachael, and he
later exchanged the shares for the ESOP promissory notes. During the marriage, Robert
made payments to Tom on the 2005 promissory note, which he originally executed in
exchange for the Eutaw shares. However, Robert testified without contradiction that he
made those payments using shareholder distributions and payments from the ESOP
promissory notes. There is no evidence in the record that Robert ever used marital funds to
make payments on the 2005 promissory note. Finally, Rachael presented no evidence that
the value of Robert’s interest in Eutaw appreciated during the marriage “and that such
appreciation was attributable to [Robert’s] efforts.” Dean, 304 So. 3d at 166 (¶36) (quoting
Kimbrough, 76 So. 3d at 720 (¶22)).9 On this record, Robert’s Eutaw shares and the ESOP
9 Note that only about two years passed between the date of the marriage (2010) and
20 notes remained Robert’s separate property.
¶36. To take a step back, when Robert received the Eutaw shares from his father in 2005,
he executed a promissory note for $1,067,664. There is no evidence that the note, executed
as part of a father-son transfer of an ownership interest in a family business, reflected the fair
market value of the shares Robert received. Regardless, the evidence shows that Robert paid
about $190,000 on the note before the marriage and then paid a total of about $350,000 on
the note between the date of the marriage and the date of demarcation. As stated above, there
is no evidence that Robert used marital funds to make those payments or that the Eutaw
shares or ESOP promissory notes appreciated in value as a result of Robert’s efforts during
the marriage. Nonetheless, the chancellor found that the ESOP promissory notes were a
100% marital asset worth $6,389,371.5510 and ordered Robert to pay Rachael $3,000,000 as
part of the property division. The evidence in the record simply cannot justify this result.
TBCB Properties
¶37. TBCB LLC was created in 2012 when the former owners of Eutaw Construction sold
the date Robert exchanged his Eutaw shares for ESOP notes (2012). During those two years, Robert worked at Eutaw, but he was not yet president of the company. There is no evidence that Robert’s efforts as a Eutaw employee from 2010 to 2012 did anything to cause Eutaw’s stock to increase in value. Moreover, there is no evidence that Robert’s efforts from 2012 to 2020 had any impact on the value of the ESOP promissory notes, which were subject to contractual repayment terms. Finally, the mere fact that Robert made payments to Tom on the 2005 promissory note had no effect on the value of Eutaw Construction or the ESOP promissory notes. 10 Robert sold the notes to Tom for $4,200,000. Tom testified that he bought the notes at a discount because he was assuming the risk of nonpayment. Rachael’s expert testified that the true value of the notes was more than fifty percent higher ($6,389,371.55). The chancellor accepted Rachael’s expert’s valuation.
21 their shares to the ESOP. “TBCB” is an acronym for Eutaw’s four owners at the time—Tom,
Bobby (Robert), Cindy, and Bill. As described by Tom and Robert, Eutaw essentially spun
off certain real estate to TBCB before it created the ESOP. Each of Eutaw’s owners received
an ownership interest in TBCB equal to their ownership interest in Eutaw. Since Robert
received his ownership interest in TBCB as a partial distribution of his former ownership
interest in Eutaw, his interest in TBCB is also separate property. Bell, supra, § 6:04[1], at
155. The chancellor stated TBCB was presumed to be marital property because it was
formed during the marriage, and Robert “failed to rebut the presumption.” However, Tom
and Robert’s testimony was uncontradicted and clearly established that Robert’s ownership
in TBCB is his separate property.11
11 The chancellor valued Robert’s 17.4% interest in TBCB at $258,010.68.