Shackelford v. Shackelford

COURT OF APPEALS OF VIRGINIA

Present: Judges Benton, Frank and Humphreys
Argued at Chesapeake, Virginia

VIVIAN T. SHACKELFORD
OPINION BY
v. Record No. 0746-02-1 JUDGE ROBERT P. FRANK
NOVEMBER 19, 2002
GARLAND T. SHACKELFORD

FROM THE CIRCUIT COURT OF GLOUCESTER COUNTY
Barnard F. Jennings, Judge Designate

McClanahan Ingles (Martin, Ingles & Ingles,
Ltd., on briefs), for appellant.

E. Thomas Cox for appellee.

Vivian T. Shackelford (wife) and Garland T. Shackelford

(husband) were divorced on February 22, 2002. Wife appeals from

that final decree, arguing the trial court erred (1) in its

valuing of the marital businesses and in its equitable

distribution of those properties, (2) in failing to award interest

during the payment period of wife's monetary award, (3) in

awarding wife less spousal support than husband recommended, and

(4) in failing to award wife half of the rent collected during the

parties' separation. 1 For the reasons below, we affirm the trial

court's order.

1
Appellant abandoned the issue of rental income at oral
argument. Therefore, we do not address this issue in this
opinion.
 Background

Wife and husband were married for almost thirty-eight years

and had two grown children. For most of the marriage, wife

remained at home, although she did work as a part-time nurse for

thirteen years. Husband started two businesses during the

marriage: Shackelford Seafood Corp. (Shackelford Seafood) in 1966

and B.L.P. Seafood Transfer Inc. (B.L.P.) in 1995. The parties

separated in January 1996, when wife asked husband to leave the

marital home because he was romantically involved with another

woman.

Husband paid wife's expenses after the separation, 2 including

the mortgage on the marital home, maid and lawn care services,

utilities, country club membership, car payments, and medical

expenses. A pendente lite order, entered by the juvenile and

domestic relations court, also required husband to pay wife "$500

per week from his corporation."

The trial court heard evidence ore tenus on June 26, 2001,

and received into evidence numerous documents. The parties agreed

wife remained at home during the marriage, making significant

contributions to the family, while husband worked. Shackelford

Seafood depended heavily on husband's presence, but B.L.P., which

was based in Florida, was run initially by the parties' son.

2
Most, if not all, of these expenses were paid through
Shackelford Seafood, which is a privately held business owned by
husband.

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 Shackelford Seafood became wholly owned by husband in 1987,

when he bought out the fifty-percent interest of Gerald Thomas for

$500,000. Husband could not remember how this price was reached.

William Stephens, testifying as wife's expert, valued Shackelford

Seafood at $1,635,785. Gregory Lawson, husband's expert,

testified the business was worth $838,000. Both men defended

their valuations during their testimony.

Stephens initially valued B.L.P. at around $43,000, but he

increased that valuation to $683,738 after receiving information

on B.L.P.'s income for the first three months of 2001. Lawson

valued B.L.P. at $43,500.

Both parties presented the court with estimates of wife's

expenses. Wife testified that, although she had worked part-time

as a nurse for thirteen years during the marriage, she had not

worked since 1995. Wife had several medical problems.

In closing arguments, the parties argued over the valuation

of the businesses. Wife suggested she receive $6,000 in spousal

support. Husband suggested $4,000 in spousal support and admitted

that some, although not all, of wife's expenses should be added to

that amount.

The trial court announced its judgment from the bench,

valuing Shackelford Seafood at $838,000 and B.L.P. at $43,500.

The court found wife was entitled to forty percent of Shackelford

Seafood and fifty percent of B.L.P. Husband was allowed to keep

both businesses, and wife was allowed to keep the marital home.

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The court set spousal support to wife at $5,000 per month and set

husband's payment to wife for her portion of the marital estate at

$486,005 over ten years. The final decree specified no interest

was awarded for the ten-year payment period.

Analysis

On appeal, we review the evidence and the inferences in the

light most favorable to the party prevailing below. Gottlieb v.

Gottlieb, 19 Va. App. 77, 81, 448 S.E.2d 666, 669 (1994); Rogers

v. Yourshaw, 18 Va. App. 816, 818, 448 S.E.2d 884, 885 (1994).

A final decree of divorce is presumed correct, and we defer to

the factual findings of the court, such as valuation of marital

property, where the court took evidence ore tenus. Id. at 83,

448 S.E.2d at 670.

A. The Businesses

1. Valuation

Wife argues husband's purchase of the outstanding interest in

Shackelford Seafood is evidence of the trial court's undervaluing

the business. Wife contends, because husband paid $500,000 in

1987 for half the business, the whole business was worth more than

one million dollars in 2001. She argues the business could not be

valued at less than a million dollars as the business had grown

since 1987.

When announcing his valuation of the businesses, the judge

explained he "was much more impressed with Mr. Lawson in his

reasoning and his logic and his conclusion." We see nothing wrong

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with this conclusion. The trial court was entitled to accept

Lawson's valuation. Lawson explained his credentials included

valuing other seafood businesses. He explained why his method of

valuation was best in this situation. He explained his

disagreements with Stephens's methodology.

Lawson also explained why the 1987 buy out from Thomas was

not an important factor in setting Shackelford Seafood's value in

2001:

The valuation of a partial interest, when
then converted into 100 percent interest,
would not be arithmetically the same [as
multiplying 500,000 by two]. In the case of
Mr. Thomas, one would be willing to pay him
specifically above the pro rata business
because he had the ability to exercise
blockage, decisions could not be made within
the business without his consent and
approval, and with those situations there's
a long list of precedence within business
valuation that blockage premiums go up to
about twenty percent. You pay twenty
percent more when you're removing a blockage
ownership unit than you would in everything
else.

* * * * * * *

So, in one respect [husband] really had no
control of that company prior to acquiring
Mr. Thomas's interest, and, therefore, would
be willing to pay significantly above the
pro rata in order to gain control.

The trial court heard the testimony of the two experts and

evaluated those experts' opinions. We defer to the trial

court's evaluation of the credibility of the witnesses who

testify ore tenus. Moreno v. Moreno, 24 Va. App. 190, 195, 480

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S.E.2d 792, 795 (1997). Based on the evidence, we cannot find

the trial court was plainly wrong in accepting Lawson's opinion

and setting the value for Shackelford Seafood at $838,000.

Wife also argues the trial court abused its discretion in

setting the value of B.L.P. She contends on brief, "The only

evidence before the Court regarding the value of BLP was Mr.

Stephens' [sic] current valuation at $683,738." We disagree.

The trial court had sufficient evidence to set the value at

$43,500. Initially, Stephens set the value of B.L.P. at

approximately $43,000. He increased that value to $683,738 when

he received income figures from the first three months of 2001.

Lawson "did a complete analysis [of B.L.P.,] but not a

written report." He reviewed Stephens's initial report and

generally agreed with its valuation, although he used a

different valuation method. He testified, both at trial and

during depositions, that B.L.P. was worth $43,500.

Lawson did not revise his valuation based on the three

months of income figures. He explained:

The seafood industry is very similar to a
CPA practice where you do all of your work
in January through March, tax season. In
seafood industry and transfer of seafood
products, that's their peak season; January
through March is the peak season in the
industry because he's shipping all up or
down the East Coast and into the Midwest.

There are no fish available in the
colder climates from the Carolinas up
through New England. During that time of
year, winter season, your fin fish and

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 seafood products are not available locally
at that point in time, and, therefore, have
to be shipped in from South America. It
stands to reason, if you have shipping
experience, that's peak season just like tax
season for a CPA firm.

Further, in looking at the three-month
period, [Stephens] ignores all the expenses,
normal expenses, a business would have if
the company would not have a bill for that
month.

* * * * * * *

So, there's a whole slew of expenses he
ignores in looking at the three-month period
that would be normal and ordinary expense of
the company.

Lawson also testified regarding other problems and

inconsistencies in Stephens's revised valuation of B.L.P.

The court had sufficient information based on Lawson's

testimony to value B.L.P. at $43,500. We do not find the trial

court's valuation of either business was plainly wrong.

2. Equitable Distribution

Wife argues the trial court erred in awarding her only

forty percent of Shackelford Seafood. She contends husband was

unfaithful during the marriage, while she made significant

contributions to the home and the business. She argues the

forty-percent award was arbitrary, as the trial court awarded

her fifty percent of B.L.P., without any "evidence or

explanation by the Court to justify the disparity." We

disagree.

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 The final decree of divorce noted: "The Court, after

considering the evidence presented herein, and the equitable

distribution factors as set forth in [Code] § 20-107.3 . . .

made the following findings." At the hearing, the trial court

explained the equitable division of the businesses:

I feel that [wife], for a number of reasons,
no question but that she has been a good
wife, she's really supported the household
and a lot more than a number of ours would
have done in similar circumstances, and
certainly she did an excellent job managing
the children, and she's entitled to a lot of
credit for that.

On the other hand, [husband], with some
assistance from his wife over time, really
was the instrumental part of Shackelford
Seafood. Except for [husband], in his
absence the business would be pretty close
to non-existing. I don't mean – in making
that determination, I don't think there's
any question but that he is really the
brains behind it and the motivating factor
behind the business itself, the seafood as
well as the B.L.P. Under those
circumstances, I would make a determination
that [wife] is entitled to forty percent of
the business. Of B.L.P., she would be
entitled to one half the valuation put on
that.

"In reviewing an equitable distribution award on appeal, we

recognize that the trial court's job is a difficult one.

Accordingly, we rely heavily on the discretion of the trial

judge in weighing the many considerations and circumstances that

are presented in each case." Artis v. Artis, 4 Va. App. 132,

137, 354 S.E.2d 812, 815 (1987). The court is not required to

elaborate upon the exact weight given each piece of evidence and

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each factor used to reach its decisions. As this Court has

explained previously:

The requirement that the trial court
consider all of the statutory factors
necessarily implies substantive
consideration of the evidence presented as
it relates to all of these factors. This
does not mean that the trial court is
required to quantify or elaborate exactly
what weight or consideration it has given to
each of the statutory factors. It does
mean, however, that the court's findings
must have some foundation based on the
evidence presented.

Woolley v. Woolley, 3 Va. App. 337, 345, 349 S.E.2d 422, 426

(1986) (discussing spousal support).

We find nothing in the Code or case law, and wife provides

no authority, that requires a fifty-fifty distribution of

marital assets. A fifty-percent distribution is not

presumptively appropriate. Papuchis v. Papuchis, 2 Va. App.

130, 132, 341 S.E.2d 829, 830-31 (1986). Instead, a trial court

considers the factors in Code § 20-107.3, to make a decision

regarding division of marital property.

Wife argues the trial court "could have and should have"

weighed husband's alleged adultery in the equitable

distribution, "but it declined to do so." However, the final

decree clearly states the factors in Code § 20-107.3 were

considered. Nothing required the court to emphasize the factor

of adultery in making the distribution. Instead, the trial

court could use its discretion in weighing any finding of

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adultery. See Aster v. Gross, 7 Va. App. 1, 5-6, 371 S.E.2d

833, 836 (1988); O'Loughlin v. O'Loughlin, 20 Va. App. 522,

526-27, 458 S.E.2d 323, 325-26 (1995).

The evidence proved wife made significant contributions to

the family, but she had little to do with the businesses. Her

expert testified husband was the "key man in the operation" of

Shackelford Seafood. The newer business, B.L.P., was organized

as a shipping component of the older company. According to the

testimony, B.L.P. was started to provide employment to the

parties' son while he was in Florida. Once he left, husband

took over that business. This history suggests husband was not

as integral to B.L.P.'s operations.

Based on this evidence, we cannot find the award to wife

of forty percent in the business that husband worked to develop

for over thirty years, and fifty percent in the business husband

started less than ten years ago for someone else to run, was an

abuse of discretion.

B. Interest on Monetary Award

Wife argues the trial court erred in failing to award her

interest, pursuant to Code § 8.01-382, on the monetary award

that husband has ten years to pay. We disagree with wife.

Code § 8.01-382 states:

In any action at law or suit in equity,
. . . the judgment or decree of the court,
may provide for interest on any principal
sum awarded, or any part thereof, and fix
the period at which the interest shall

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 commence. The judgment or decree entered
shall provide for such interest until such
principal sum be paid.

This Code section applies in divorce cases. See, e.g., Ragsdale

v. Ragsdale, 30 Va. App. 283, 293, 516 S.E.2d 698, 703 (1999).

However, Code § 20-107.3(D) further explains, "The provisions of

§ 8.01-382 . . . shall apply unless the court orders otherwise."

(Emphasis added.)

Here, the trial court specified in paragraph eleven of the

final decree that interest on the monetary award was not

awarded. As the court "ordered otherwise," wife is not entitled

to interest under Code § 8.01-382.

C. Spousal Support

Finally, wife argues the trial court erred in awarding

spousal support of $5,000 per month. Wife claims she

demonstrated a need for $6,999 per month based on her expenses

prior to the division of marital property. 3 She contends, "[T]he

very least amount of support should have been the $5,800 which

husband paid voluntarily as ordered pendente lite in a consent

order." 4 She also argues husband has the ability to pay the

3
In closing argument to the trial court, however, wife
asked for support payments of $6,000 a month. She did not ask
for husband to pay any additional bills, such as the car loan or
the mortgage.
4
We note husband's support payments under this order were
not binding on the trial court. Code § 20-103(E); Holmes v.
Holmes, 7 Va. App. 472, 484, 375 S.E.2d 387, 394 (1988) (noting
the amount in a temporary order is not a factor the court need
consider in determining the amount of spousal support).

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larger amount. On brief, wife also claims "the Court did not

properly consider the statutory factors enumerated in Section

20-107.1."

When the trial court announced its decision, the following

exchange occurred:

[WIFE'S ATTORNEY]: And addition to the
$5,000, even in addition to that, he would
be responsible, we would request, for the
automobile payment, even as in [husband's
attorney's] proposal, until that's paid off.

THE COURT: I considered that in the alimony
support payments.

[WIFE'S ATTORNEY]: Without belaboring it,
that figure is less than the [husband]
proposed, Judge Jennings. I think that
covers all the questions . . . .

Nothing else was said regarding spousal support.

Wife also submitted several objections to the final decree.

One objection reads:

6. The spousal support award was
substantially less than the [husband] had
suggested is appropriate, and less than
[wife] needs and [husband] has the ability
to pay and failed to recognize [husband's]
unreported income or the fact that
[husband's] suggested spousal support
exceeded his adjusted gross income,
confirming that [husband] failed to report
his true income (attached hereto is a copy
of [husband's] proposal that he pay $5,723
per month spousal support, which equals
$68,676 per year, yet [husband's] adjusted
gross income on his attached 2000 tax return
was $65,770)[.]

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Another objection claims: "5. The spousal support award was

less than the [husband] had agreed to pay." Accordingly, wife

has not preserved any argument related to Code § 20-107.1, as

her objections at trial were not based on that statute. See Lee

v. Lee, 12 Va. App. 512, 514, 404 S.E.2d 736, 737-38 (1991) (en

banc); Rule 5A:18.

Wife did preserve her argument that the trial court erred

in awarding $5,000 per month because husband's offer was larger.

The factual premise of this argument is wrong, however. During

closing argument, husband argued the court should set spousal

support at $4,000 as well as order him to pay off the automobile

loan, approximately $569 a month. 5 This recommendation clearly

was less than the $5,000 ultimately awarded by the trial court.

Additionally, husband’s earlier proposal, to which wife

refers in her written objection, did not necessarily recommend

more than $5,000 per month. The base support recommended by

husband in this proposal was $4,000. He also recommended an

additional $1,723 "until car paid off" and "until home mortgage

paid off." This additional amount extended for a finite period,

in contrast to the additional $1,000 that the trial court

actually awarded to wife. Also, this proposal was based on a

different equitable division and monetary award than the trial

court eventually made.

5
The record does not include the amount of the outstanding
balance.

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 More importantly, wife did not accept husband's proposal.

As the proposal did not represent a written agreement, it was

not binding on the court. Cf. Flanary v. Milton, 263 Va. 20,

22-24, 556 S.E.2d 767, 768-69 (2002) (noting oral agreements

regarding divorce issues are not binding on the trial court).

Wife chose to allow the trial court to determine the amount of

support payments. She cannot now claim the court was bound by

husband's proposal.

Wife also argues the trial court failed to recognize

husband's underreported income and, therefore, did not award

sufficient spousal support. Again, the record does not support

wife's factual allegation.

Wife's written objection notes husband's federal tax forms

set his income as $65,770 for 2000. If the trial court believed

this figure, then the support award left husband with $5,770 of

his yearly income. We do not believe the court intended to

leave husband in poverty. Clearly, the trial court did not

accept this figure, as husband could not pay $5,000 a month on

this salary.

The record also contains husband's tax forms for other

years that indicate incomes of $178,370 and $173,522. Husband's

proffer admitted an income of $3,885 per month. In light of the

evidence, we conclude the trial court did not assume an income

of $65,770 in setting spousal support.

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 Wife argues she proved a need for more than $5,000 a month.

However, during the parties' separation, she lived on

approximately $5,800 per month, without the income and assets

from the equitable distribution. 6 Additionally, wife provides no

statute or case law that suggests her need is the sole and

controlling factor in support determinations. Wife is not left

destitute. We find the trial court did not err in determining

spousal support. We affirm the award of $5,000 per month.

Conclusion

The trial court did not err in determining the awards here.

We affirm the final decree of divorce.

Affirmed.

6
Wife receives ten yearly payments of approximately
$48,600, the marital home, life insurance policies, an IRA
account, and a van under the final decree of divorce. She is
responsible for the outstanding amount on the home mortgage and
the van loan.

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