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Grimsley v. Drewyor

Court of Appeals of Arkansas, Division II

April 17, 2019

Jill GRIMSLEY, Appellant
Pine DREWYOR, Appellee

          Rehearing Denied May 22, 2019

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[Copyrighted Material Omitted]

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         Smith, Cohen & Horan, PLC, by: Matthew T. Horan, Fort Smith; and Ralph C. Williams, Bentonville, for appellant.

         Cullen & Co., PLLC, by: Tim Cullen, for appellee.


         RITA W. GRUBER, Chief Judge

          The parties in this case, Jill Grimsley and Pine Drewyor, were divorced by decree entered February 2, 2018, after a sixteen-year marriage. Ms. Grimsley appeals from the divorce decree and a postdecree order, arguing that the circuit court erred (1) by awarding joint custody; (2) by awarding permanent alimony to Mr. Drewyor, who has "ample capacity for self-support"; (3) in the amount of alimony awarded; (4) by awarding Mr. Drewyor a one-half interest in Ms. Grimsley’s partnership interest; (5) in its treatment of certain marital debt; and (6) in requiring Ms. Grimsley to make a one-time payment of $ 1.25 million in child support to Mr. Drewyor constituting 25 percent of a five-million-dollar inheritance from her father. We affirm in part and reverse in part.

          I. Facts and Procedural History

          The parties married in April 2002 when they were both practicing law in Tulsa, Oklahoma. A year after their first child was born in June 2006, the parties moved to Northwest Arkansas to be near Ms. Grimsley’s family. Ms. Grimsley accepted an offer from Mitchell Williams in 2007; five years later, she became a nonequity partner; and in January 2016, she became an equity partner. Mr. Drewyor began a solo practice in 2007 and continues to practice as Drewyor Law Firm, PLC. The parties have three children, two daughters and one son, who were eleven, eight, and five at the time the divorce decree was entered.

          A. Divorce

          Mr. Drewyor filed a complaint for divorce in December 2016, and Ms. Grimsley moved out of the marital home and into her mother’s home in April 2017. On April 28, 2017, the circuit court executed an agreed temporary order incorporating a handwritten settlement agreement that provided the children would spend alternate weeks with each parent, Tuesday nights until 8:00 p.m. with the noncustodial parent, and an afternoon each week with Ms. Grimsley’s mother, "Grand." Ms. Grimsley agreed to continue to pay child

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care and the mortgage, taxes, and home insurance on the marital home; Mr. Drewyor agreed to pay the utilities, cleaning, and yard maintenance while he lived in the marital home.

          The circuit court conducted a final hearing on custody, child support, alimony, and several property and debt-division issues on November 20 and 21, 2017, and entered a final decree of divorce on February 2, 2018. The court awarded joint custody, continuing the schedule to which the parties had agreed in the temporary settlement agreement of alternate weeks, Tuesday evenings with the parent not having physical custody that week, holidays as set forth in the court’s suggested standard-visitation schedule, and ten consecutive, uninterrupted days during summer break with each parent upon thirty days’ notice to the other parent. The court ordered that each parent had the right of first refusal to provide care for the children before seeking a third party and that Grand had the right to provide care for the children if neither parent was available before seeking a third party. The court ordered Ms. Grimsley to pay child support to Mr. Drewyor in the amount of $ 1349 "due to the discrepancy in the net earnings of the parties." The court also ordered both parties to "pay an additional amount equal to 25% of any net bonus, income, payment, tax refund or any other funds received as defined by Administrative Order No. 10, as additional child support." Ms. Grimsley was ordered to maintain medical insurance for the children, and the parties were ordered to each pay one-half for medical, psychological, dental, optical, and any other healthcare expenses not covered by insurance. Mr. Drewyor was also awarded permanent alimony of $ 3787 per month. Finding that they were marital property, the court divided equally Ms. Grimsley’s Mitchell Williams partnership interest valued at $ 50,500, her "drawing account" valued at $ 77,000, and Mr. Drewyor’s law-firm assets valued at $ 8,000. Finally, the court found that an Arvest line of credit used by Mr. Drewyor was his sole and separate obligation, and it ordered Mr. Drewyor to reimburse Ms. Grimsley the sum of $ 30,370 that she had paid to extinguish the loan. However, a Generations Bank line of credit in the amount of $ 25,000 was found by the court to constitute marital debt and the court required each party to pay half.

          B. Postdivorce

         Less than six months after entry of the divorce decree, Mr. Drewyor filed a petition for citation for contempt, alleging that Ms. Grimsley had received an inheritance valued at $ 5 million in December 2017; [1] that the court’s February 2018 decree of divorce and our supreme court’s opinion in Ford v. Ford, 347 Ark. 485, 65 S.W.3d 432 (2002), required her to pay 25 percent of that inheritance to him as child support; and that she should be held in contempt for failing to do so.

         Ms. Grimsley responded to the petition, denying that she had received any payments or funds in December 2017; stating that she had received a distribution of unregistered, restricted shares of Grand Savings Bank, a closely held corporation, in 2017; arguing that Ford does not support the payment of child support from a transfer of personalty or realty to a joint-custodial parent who is already receiving adequate support; and alleging that Mr. Drewyor had not shown that a transfer of $ 1.25 million to him was in the children’s best interest. She argued that Administrative

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Order No. 10 is premised on the payee’s having sole custody and that the amount of child support must be in the best interest of the children, not the payee.

          On September 17, 2018, the court held a hearing on the motion for contempt. Ms. Grimsley testified that she had received an inheritance worth approximately $ 5 million, though none of it had been in cash. First, in December 2017, she received a stock certificate representing 296,991 shares of Grand Bancorp, Inc., valued at approximately $ 2.8 million. She testified that the stock was restricted and must be sold to "accredited investors." Second, in March 2018, she received an investment account worth $ 1,869,000. Finally, in June 2018, she received a warranty deed for a lot worth approximately $ 150,000. She said that she had received no money in any of these three transfers. She also testified that the investments would need to be liquidated before she could remove any money from the investment account. While she assumed that she could direct a liquidation of the account, she had never done so and had not intended to do so. She also responded to questions regarding the sale of her lot, indicating that she could attempt to sell the lot but then she would not have a home.

         Counsel for Mr. Drewyor argued that the set percentage of 25 percent of any additional income was res judicata pursuant to paragraph 14 of the court’s decree of divorce and could not be relitigated and that, consequently, Ms. Grimsley owed child support in the amount of $ 1.25 million, 25 percent of her inheritance. He urged the court to reject Ms. Grimsley’s request for a deviation from the 25 percent arguing that the parties were bound both by paragraph 14 of the court’s order dictating 25 percent of income and by the supreme court’s opinion in Ford interpreting income broadly to include an inheritance. He also claimed that Administrative Order No. 10 put no "cap" on child support; Ms. Grimsley was obligated to pay Mr. Drewyor 25 percent of her inheritance as child support whether it be $ 10,000 or $ 5 million; and she was in contempt for failing to have done so. He rejected Ms. Grimsley’s argument that because the inheritance was not in funds or money, she was not obligated to pay child support from it. He argued that she could sell the property and have cash within thirty days or "faster."

         Ms. Grimsley argued that the holding in Ford does not support Mr. Drewyor’s argument and that a payor is not required to "liquidate" physical assets that have been given to him or her to pay child support. She contended that Ford concerned a situation in which a noncustodial parent was not working at all and therefore was not paying any child support. In such a situation, the court allowed child support to be paid from other assets or income of the payor. She also argued that the court must determine what is an appropriate amount of child support for the parties’ children. She contended that Ford does not hold that a payee is automatically entitled to a particular percentage of a lump-sum gift to the payor. Finally, she argued that the court in this case had already ordered an appropriate level of child support with knowledge that she was going to inherit $ 5 million.[2] At the close of the hearing, the court found there was good cause for Ms. Grimsley’s failure to pay child support from her inheritance because the transactions had not been "liquidated"; thus, she was not in contempt.

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          The court entered an order on October 10, 2018, denying the petition for contempt, enjoining Ms. Grimsley from liquidating or transferring any of the inherited assets, and reserving its ruling as to a "sum certain concerning the three transactions" constituting her inheritance. Mr. Drewyor filed a motion for reconsideration, requesting the court to compel Ms. Grimsley to comply with paragraph 14 of the divorce decree and pay 25 percent of her inheritance even though her failure to pay may not have been willful. He argued that the obligation to pay child support from the inheritance attached immediately upon her receipt of the assets and explained ...

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