COURT OF APPEALS OF VIRGINIA
Present: Judges Kelsey, Petty and Senior Judge Clements Argued at Alexandria, Virginia
THOMAS J. DOUGHERTY MEMORANDUM OPINION * BY v. Record No. 0213-09-4 JUDGE JEAN HARRISON CLEMENTS OCTOBER 6, 2009 SHARON M. DOUGHERTY
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY David S. Schell, Judge
John K. Cottrell (Cottrell, Fletcher, Schinstock, Bartol & Cottrell, P.C., on briefs), for appellant.
Sharon Dougherty, pro se.
Thomas J. Dougherty (husband) appeals from an order modifying the final decree of
divorce. Husband argues that the trial court erred in (1) finding that husband’s interests in the
Springfield M-1 and Des Moines M-1 partnerships were marital property and not husband’s
separate property; (2) adopting the opinion of the wife Sharon M. Dougherty’s expert regarding the
value of husband’s partnership leases, when such value was speculative and founded upon
assumptions which were not supported by the evidence; and (3) not adopting the opinion of
husband’s expert regarding the value of husband’s partnership leases. Finding no error, we affirm
the trial court’s decision.
BACKGROUND
As the parties are fully conversant with the record in this case and because this
memorandum opinion carries no precedential value, this opinion recites only those facts and
* Pursuant to Code § 17.1-413, this opinion is not designated for publication. incidents of the proceedings as are necessary to the parties’ understanding of the disposition of
this appeal.
The parties married on February 1, 1991, and they separated in March 2006.
In 1989, prior to the marriage, husband and another individual formed a partnership called
Libmot Communications Partnership (Libmot). Libmot’s purpose was to apply for broadband radio
service (BRS) licenses and lease them to wireless cable operators.
During the marriage, husband created additional partnerships to acquire BRS licenses.
Husband and wife stipulated that two of those partnerships, Idaho Falls Wireless Partnership and
Springfield One Partnership, were marital property. Husband started two other partnerships,
Springfield M-1 Partnership and Des Moines M-1 Partnership, during the marriage. Husband
contends these partnerships are his separate property, while wife argues that they are marital
property.
The trial court initially held that the Springfield M-1 and the Des Moines M-1 partnerships
were husband’s separate property because they were funded by Libmot, which was husband’s
separate property. Wife filed a motion to reconsider the classification of Libmot and the Springfield
M-1 and Des Moines M-1 partnerships. Wife argued that the Springfield M-1 and Des Moines M-1
partnerships were marital because they were established during the marriage. The trial court agreed
with wife and modified the final decree, holding that the Springfield M-1 and Des Moines M-1
partnerships were marital property.1 Husband timely noted his appeal.
1 The trial court did not reconsider its opinion regarding the classification of Libmot and held that Libmot was husband’s separate property. The classification of Libmot is not at issue on appeal. -2- ANALYSIS
Issue 1 – Classification
Husband argues that the trial court erred in classifying the Springfield M-1 and Des Moines
M-1 partnerships as marital property.
On appeal, “decisions concerning equitable distribution rest within the sound discretion
of the trial court and will not be reversed on appeal unless plainly wrong or unsupported by the
evidence.” McDavid v. McDavid, 19 Va. App. 406, 407-08, 451 S.E.2d 713, 715 (1994) (citing
Srinivasan v. Srinivasan, 10 Va. App. 728, 732, 396 S.E.2d 675, 678 (1990)).
In late 1991, husband became a twenty percent owner in the Des Moines M-1 Partnership.
In 1992, husband became a twenty percent owner in the Springfield M-1 Partnership. Libmot paid
the FCC license fees on behalf of the Des Moines M-1 and Springfield M-1 partnerships. Aside
from husband’s testimony regarding the contributions made by Libmot, husband offered no further
evidence of his contributions toward the Des Moines M-1 and Springfield M-1 partnerships.
Initially, the trial court found that the Springfield M-1 and Des Moines M-1 partnerships
were husband’s separate property. However, upon wife’s motion for reconsideration, the trial court
held that the partnerships were marital property. The trial court stated that “when the partnerships
were formed during the marriage, the instant they’re formed [sic] they’re marital property.”
“‘All property acquired by either spouse during the marriage is presumed to be marital
property in the absence of satisfactory evidence that it is separate property. The party claiming
that property should be classified as separate has the burden to produce satisfactory evidence to
rebut this presumption.’” Stratton v. Stratton, 16 Va. App. 878, 882, 433 S.E.2d 920, 922 (1993)
(quoting Stroop v. Stroop, 10 Va. App. 611, 614-15, 394 S.E.2d 861, 863 (1990)). Therefore,
the Springfield M-1 and Des Moines M-1 partnerships were presumed to be marital property,
and husband had the burden to prove they were his separate property.
-3- Separate property is “all property, real and personal, acquired by either party before the
marriage . . . [and] all property acquired during the marriage in exchange for or from the
proceeds of sale of separate property, provided that such property acquired during the marriage is
maintained as separate property.” Code § 20-107.3(A)(1). Husband argues that the Springfield
M-1 and Des Moines M-1 partnerships are his separate property because funds from Libmot, his
separate property, were used in exchange for his acquisition of the partnerships.
Wife contends husband did not present any evidence that the partnerships were acquired
in exchange for or from proceeds of the sale of Libmot. She argues that Libmot’s payment of the
filing fees for the licenses acquired by the partnerships is not the equivalent of Libmot being
exchanged for or sold to pay for husband’s interest in the partnerships.
An exchange is defined as “the act of transferring interests, each in consideration of the
other,” and a sale is defined as “the transfer of property or title for a price.” Black’s Law
Dictionary 645, 1454 (9th ed. 2009). We conclude there was no “exchange” or “sale” between
Libmot and the Springfield M-1 and Des Moines M-1 partnerships.
Libmot is a partnership, which is a separate legal entity from husband. When Libmot
paid the FCC license fees on behalf of the Springfield M-1 and Des Moines M-1 partnerships,
Libmot did not receive anything in return. The license fees were owned not by Libmot, of which
husband was one of two partners, but by the Springfield M-1 and Des Moines M-1 partnerships,
of which husband was one of five partners. Both before and after Libmot paid the FCC license
fees, husband’s interest in Libmot remained at fifty percent, and his interest in the Springfield
M-1 and Des Moines M-1 partnerships remained at twenty percent.
Husband argues that Libmot’s purchase of the FCC license fees is similar to the stock
pledge made by the husband in Gilman v.
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COURT OF APPEALS OF VIRGINIA
Present: Judges Kelsey, Petty and Senior Judge Clements Argued at Alexandria, Virginia
THOMAS J. DOUGHERTY MEMORANDUM OPINION * BY v. Record No. 0213-09-4 JUDGE JEAN HARRISON CLEMENTS OCTOBER 6, 2009 SHARON M. DOUGHERTY
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY David S. Schell, Judge
John K. Cottrell (Cottrell, Fletcher, Schinstock, Bartol & Cottrell, P.C., on briefs), for appellant.
Sharon Dougherty, pro se.
Thomas J. Dougherty (husband) appeals from an order modifying the final decree of
divorce. Husband argues that the trial court erred in (1) finding that husband’s interests in the
Springfield M-1 and Des Moines M-1 partnerships were marital property and not husband’s
separate property; (2) adopting the opinion of the wife Sharon M. Dougherty’s expert regarding the
value of husband’s partnership leases, when such value was speculative and founded upon
assumptions which were not supported by the evidence; and (3) not adopting the opinion of
husband’s expert regarding the value of husband’s partnership leases. Finding no error, we affirm
the trial court’s decision.
BACKGROUND
As the parties are fully conversant with the record in this case and because this
memorandum opinion carries no precedential value, this opinion recites only those facts and
* Pursuant to Code § 17.1-413, this opinion is not designated for publication. incidents of the proceedings as are necessary to the parties’ understanding of the disposition of
this appeal.
The parties married on February 1, 1991, and they separated in March 2006.
In 1989, prior to the marriage, husband and another individual formed a partnership called
Libmot Communications Partnership (Libmot). Libmot’s purpose was to apply for broadband radio
service (BRS) licenses and lease them to wireless cable operators.
During the marriage, husband created additional partnerships to acquire BRS licenses.
Husband and wife stipulated that two of those partnerships, Idaho Falls Wireless Partnership and
Springfield One Partnership, were marital property. Husband started two other partnerships,
Springfield M-1 Partnership and Des Moines M-1 Partnership, during the marriage. Husband
contends these partnerships are his separate property, while wife argues that they are marital
property.
The trial court initially held that the Springfield M-1 and the Des Moines M-1 partnerships
were husband’s separate property because they were funded by Libmot, which was husband’s
separate property. Wife filed a motion to reconsider the classification of Libmot and the Springfield
M-1 and Des Moines M-1 partnerships. Wife argued that the Springfield M-1 and Des Moines M-1
partnerships were marital because they were established during the marriage. The trial court agreed
with wife and modified the final decree, holding that the Springfield M-1 and Des Moines M-1
partnerships were marital property.1 Husband timely noted his appeal.
1 The trial court did not reconsider its opinion regarding the classification of Libmot and held that Libmot was husband’s separate property. The classification of Libmot is not at issue on appeal. -2- ANALYSIS
Issue 1 – Classification
Husband argues that the trial court erred in classifying the Springfield M-1 and Des Moines
M-1 partnerships as marital property.
On appeal, “decisions concerning equitable distribution rest within the sound discretion
of the trial court and will not be reversed on appeal unless plainly wrong or unsupported by the
evidence.” McDavid v. McDavid, 19 Va. App. 406, 407-08, 451 S.E.2d 713, 715 (1994) (citing
Srinivasan v. Srinivasan, 10 Va. App. 728, 732, 396 S.E.2d 675, 678 (1990)).
In late 1991, husband became a twenty percent owner in the Des Moines M-1 Partnership.
In 1992, husband became a twenty percent owner in the Springfield M-1 Partnership. Libmot paid
the FCC license fees on behalf of the Des Moines M-1 and Springfield M-1 partnerships. Aside
from husband’s testimony regarding the contributions made by Libmot, husband offered no further
evidence of his contributions toward the Des Moines M-1 and Springfield M-1 partnerships.
Initially, the trial court found that the Springfield M-1 and Des Moines M-1 partnerships
were husband’s separate property. However, upon wife’s motion for reconsideration, the trial court
held that the partnerships were marital property. The trial court stated that “when the partnerships
were formed during the marriage, the instant they’re formed [sic] they’re marital property.”
“‘All property acquired by either spouse during the marriage is presumed to be marital
property in the absence of satisfactory evidence that it is separate property. The party claiming
that property should be classified as separate has the burden to produce satisfactory evidence to
rebut this presumption.’” Stratton v. Stratton, 16 Va. App. 878, 882, 433 S.E.2d 920, 922 (1993)
(quoting Stroop v. Stroop, 10 Va. App. 611, 614-15, 394 S.E.2d 861, 863 (1990)). Therefore,
the Springfield M-1 and Des Moines M-1 partnerships were presumed to be marital property,
and husband had the burden to prove they were his separate property.
-3- Separate property is “all property, real and personal, acquired by either party before the
marriage . . . [and] all property acquired during the marriage in exchange for or from the
proceeds of sale of separate property, provided that such property acquired during the marriage is
maintained as separate property.” Code § 20-107.3(A)(1). Husband argues that the Springfield
M-1 and Des Moines M-1 partnerships are his separate property because funds from Libmot, his
separate property, were used in exchange for his acquisition of the partnerships.
Wife contends husband did not present any evidence that the partnerships were acquired
in exchange for or from proceeds of the sale of Libmot. She argues that Libmot’s payment of the
filing fees for the licenses acquired by the partnerships is not the equivalent of Libmot being
exchanged for or sold to pay for husband’s interest in the partnerships.
An exchange is defined as “the act of transferring interests, each in consideration of the
other,” and a sale is defined as “the transfer of property or title for a price.” Black’s Law
Dictionary 645, 1454 (9th ed. 2009). We conclude there was no “exchange” or “sale” between
Libmot and the Springfield M-1 and Des Moines M-1 partnerships.
Libmot is a partnership, which is a separate legal entity from husband. When Libmot
paid the FCC license fees on behalf of the Springfield M-1 and Des Moines M-1 partnerships,
Libmot did not receive anything in return. The license fees were owned not by Libmot, of which
husband was one of two partners, but by the Springfield M-1 and Des Moines M-1 partnerships,
of which husband was one of five partners. Both before and after Libmot paid the FCC license
fees, husband’s interest in Libmot remained at fifty percent, and his interest in the Springfield
M-1 and Des Moines M-1 partnerships remained at twenty percent.
Husband argues that Libmot’s purchase of the FCC license fees is similar to the stock
pledge made by the husband in Gilman v. Gilman, 32 Va. App. 104, 526 S.E.2d 763 (2000). In
Gilman, the husband pledged his separate shares of stock as security for a loan for a down
-4- payment and argued that his interest in the property was separate because the stock pledge was in
exchange for the loan proceeds. Id. at 117-18, 526 S.E.2d at 769-70. The wife argued that since
the bank never obtained title to the shares of stock, there was no exchange and the property was
marital. Id. at 117, 526 S.E.2d at 769. This Court held that a stock pledge was an exchange as
contemplated by Code § 20-107.3(A)(1), and ruled, “Where no marital property, effort, or credit
is involved, a stock pledge is simply a method to use separate property to acquire additional
property. We see no equitable rationale for classifying property acquired in this manner as
marital property.” Id. at 118-19, 526 S.E.2d at 770. However, unlike Gilman, there was no
exchange in this case. Husband did not exchange or sell his interest in Libmot to acquire an
interest in the Springfield M-1 and Des Moines M-1 partnerships.
Therefore, husband did not rebut the presumption that the Springfield M-1 and Des
Moines M-1 partnerships were marital property, and the trial court did not err in classifying them
as marital property.
Issues 2 and 3 – Valuation
Husband argues that the trial court erred in accepting the opinion of wife’s expert, as
opposed to his expert’s opinion, on the valuation of the Springfield M-1 and Des Moines M-1
partnerships. Husband contends that wife’s expert relied on speculative assumptions and
assumed facts that were not in evidence.
A court may “choose among conflicting assessments of value as long as its finding is
supported by the evidence.” McDavid, 19 Va. App. at 413, 451 S.E.2d at 718.
Here, wife’s expert explained in detail the methodology he used and how he valued the
Springfield M-1 and Des Moines M-1 partnerships. He also testified as to why he disagreed with
husband’s expert’s opinion and assumptions. The trial court adopted the opinion of the wife’s
expert, and the evidence is sufficient to support the trial court’s finding.
-5- Attorney’s fees
Husband asks this Court to award him attorney’s fees and costs incurred on appeal. See
O’Loughlin v. O’Loughlin, 23 Va. App. 690, 695, 479 S.E.2d 98, 100 (1996). On consideration
of the record before us, we decline to award husband his attorney’s fees and costs on appeal.
CONCLUSION
For the foregoing reasons, we affirm the trial court’s judgment.
Affirmed.
-6-