Opinion
D.C. CIV. APP. NO. 2005-191, Sup. CT. CIV. NO. 219/2004.
Considered: June 20, 2008
December 9, 2008
BEFORE: CURTIS V. GÓMEZ, Chief Judge of the District Court of the Virgin Islands; RAYMOND FINCH, Judge of the District Court of the Virgin Islands; and FRANCIS J. D'ERAMO, Judge of the Superior Court, Division of St. Croix, sitting by designation.
Justin C. Harrell, Esq., St. Thomas, U.S.V.I., For the Appellant.
Deborah Mills, Pro Se Appellee.
On Appeal from the Superior Court of the Virgin Islands
MEMORANDUM OPINION
PER CURIAM,
Bryant John Mills (the "Appellant") appeals from a February 11, 2005, divorce decree entered by the Superior Court. For the reasons given below, the Court will affirm in part and vacate in part.
The Superior Court was previously known as the Territorial Court, which was established by the Legislature by Act 3876. Effective January 1, 2005, however, the name of the Territorial Court changed to the Superior Court of the Virgin Islands pursuant to Act of Oct. 29, 2004, No. 6687, sec. 6, § 2, 2004 V.I. Legis. 6687 (2004).
I. FACTUAL AND PROCEDURAL BACKGROUND
The Appellant and Deborah Mills (the "Appellee") were married on January 29, 1999. The parties separated in June, 2004. The Appellant filed a pro se divorce petition in the Superior Court on October 13, 2004. A summons and a copy of the divorce petition were personally served on the Appellee on October 15, 2004. On November 9, 2004, the Appellant filed a motion for entry of default against the Appellee. In his motion, the Appellant asserted that more than twenty days had passed since service of the summons and petition on the Appellee and that the Appellee had not responded or otherwise appeared. On December 31, 2004, the Superior Court entered an order scheduling a hearing on the Appellant's motion for default judgment for February 21, 2005.
The record does not reflect conclusively that default had been entered against the Appellee before the Superior Court scheduled the hearing on default judgment. At the hearing, however, the trial judge stated that default had been entered against the Appellee. [ See Appellant's App'x at 22.]
Both the Appellant and the Appellee attended the hearing before the Superior Court. At the beginning of the hearing, the trial judge noted that the purpose of the hearing was to address the Appellant's motion for default judgment, but that the Appellee was making an appearance for the first time in the case. The trial judge asked the Appellee whether she was contesting the proceedings. The Appellee answered in the negative.
Both parties appeared pro se at the hearing.
The trial judge proceeded to hear testimony from both parties. The Appellant testified that he had no children with the Appellee, owned no real property with the Appellee, and was not seeking alimony from the Appellee. The Appellee testified that the Appellant and she jointly owned a truck that was used for a landscaping business in which both parties had been partners for approximately three years. The Appellee also testified that she had signed her interest in that business over to the Appellant. Finally, the Appellee testified that the business made approximately $30,000 to $40,000 per year.
After the Appellee had finished her testimony, the trial judge asked the Appellant whether he had any response. The Appellant stated that the landscaping business was no longer making $40,00 because of a loss of customers and that he intended to give the Appellee an unspecified sum of money once the business's earnings increased.
After hearing testimony from both parties, the trial judge stated on the record his finding that the parties had jointly-held property that was subject to distribution, notwithstanding the Appellant's testimony that there was no such property. The trial judge further found that the Appellee was entitled to one-half of the lower end of the Appellee's estimate of the landscaping business's earnings during the three-year partnership, for a total of $45,000. After stating these findings on the record, the trial judge asked the Appellant how much time he estimated he would need to pay the Appellee $45,000. The Appellant replied that he did not know.
Following the hearing, the trial judge issued a divorce decree. The decree stated that the parties had no children and no real or personal property for distribution. The decree also required the Appellant to pay the Appellee $45,000 in installments of $1,000 per month for forty-five months, as compensation for the Appellee's interest in the landscaping business. The decree further stated that both parties waived their right to alimony.
This timely appeal followed. The Appellant argues that (1) the Appellee's testimony about the landscaping business violated his due process rights; (2) the award of compensation to the Appellee is based on insufficient evidence; and (3) the Appellee's testimony about the landscaping business violated the Rules of the Superior Court and the Federal Rules of Civil Procedure.
The Appellant is represented by counsel in this appeal. The Appellee is still proceeding pro se and has not filed a brief in opposition.
II. DISCUSSION
A. Jurisdiction
This Court has jurisdiction to review final judgments and orders of the Superior Court of the Virgin Islands. See Revised Organic Act of 1954 23A, 48 U.S.C. § 1613a; Act No. 6730 § 54(d)(1) (Omnibus Justice Act of 2005).
The complete Revised Organic Act of 1954 is found at 48 U.S.C. §§ 1541- 1645 (1995 Supp. 2003), reprinted in V.I. CODE ANN. 73-177, Historical Documents, Organic Acts, and U.S. Constitution (1995 Supp. 2003) (preceding V.I. CODE ANN. tit. 1).
B. Standard of Review
The Court's review of the Superior Court's application of legal precepts is plenary, and findings of fact are reviewed under a clearly erroneous standard. Prosser v. Prosser, 921 F. Supp. 1428, 1432 (D.V.I. App. Div. 1996). "The trial court has broad discretion to distribute marital assets in a divorce, and its decisions in that regard are reviewed only for abuse of that discretion." Fuentes v. Fuentes, 247 F. Supp. 2d 714, 716 (D.V.I. App. Div. 2003) (citations omitted). An abuse of discretion is a clear or obvious error of judgment that must affect substantial rights, and not simply a different result which can arguably be obtained when applying the law to the facts of the case. Government of the Virgin Islands v. Texido, 89 F. Supp. 2d 680, 686 (D.V.I. App. Div. 2000). "Even if such abuse of discretion is found, reversal is not warranted if the error was harmless." Id. at 683 (citation omitted). Only where the lower court's finding is unsupported by a credible evidentiary basis will the reviewing court reverse its decision, with due regard being given to the trial judge's opportunity to determine witness credibility. V.I. CODE ANN. tit. 4, § 33 (Lexis 2008); Feddersen v. Feddersen, 68 F. Supp. 2d 585, 590 (D.V.I. App. Div. 1999).
III. ANALYSIS
The Appellant first argues that his due process rights were violated when the trial court heard testimony from the Appellee regarding the parties' former partnership in a landscaping business and estimated revenues from that business. According to the Appellant, the trial court's consideration of that testimony violated his due process rights because he was given neither notice that such testimony would be offered at the hearing nor an opportunity to respond to that testimony. The Appellant relies on the case law of various jurisdictions to demonstrate that the trial judge abused his discretion in allowing the Appellee's testimony and making an award of compensation based on that testimony.
Rule 7 of the Rules of the Superior Court provides that "[t]he practice and procedure in the Superior Court shall be governed by the Rules of the Superior Court and, to the extent not inconsistent therewith, by the Rules of the District Court [and] the Federal Rules of Civil Procedure. . . ." Super. Ct. R. 7. Accordingly, although this matter was tried before the Family Division of the Superior Court, the general rules of procedure applicable in all civil proceedings in the Superior Court were applicable in this matter.
Rule 34 of the Rules of the Superior Court provides:
All claims in the nature of recoupment, set-off, cross-action, or any other claim for relief, except a complaint or a third-party complaint, shall be asserted in an answer as a counterclaim, and not otherwise, and shall be served and filed within the time limited for answering.
Super. Ct. R. 34 (emphasis supplied).
The record in this matter reflects that after the divorce petition and summons were personally served on the Appellee, the Appellee neither answered nor otherwise entered an appearance in this matter. The record further reflects that a default was subsequently entered against the Appellee and that the matter was scheduled for a default judgment hearing. The Appellee made her first appearance in this matter at that hearing, and testified that she did not contest the proceedings.
Under questioning by the trial judge, the Appellee testified that she had been partners with the Appellant in a landscaping business before signing her stake over to the Appellant. Although the record does not show that the Appellee requested any compensation for her stake — indeed, the record shows that the Appellee expressly stated that she did not contest the proceedings — the trial judge appears sua sponte to have awarded her compensation. In other words, the trial judge in essence created a counterclaim that the Appellee herself did not assert. Importantly, that de facto counterclaim was not asserted in compliance with Rule 34 of the Rules of the Superior Court. As a consequence, it was error for the trial judge to consider that counterclaim and to grant the Appellee relief based on that counterclaim.
Courts generally "decline to decide cases on constitutional grounds when other grounds on which to base [their] decision are available." Iturribarria v. INS, 321 F.3d 889, 895 (9th Cir. 2003) (citing Jean v. Nelson, 472 U.S. 846, 854 (1985)); see also Williams v. United States, 240 F.3d 1019, 1043 (Fed. Cir. 2001) ("[I]t is a long-standing principle that the Supreme Court does not reach out to decide cases on constitutional grounds when the matter can be resolved on other grounds.") (citations omitted), cert. denied, 535 U.S. 911 (2002).
Here, the Court's conclusion that the Appellant prevails because of a violation of the Rules of the Superior Court, obviates the need to reach the Appellant's due process argument. However, it bears noting that the Appellant had no notice that testimony about the landscaping business and its revenues would be offered at the default judgment hearing. Nor does the record demonstrate that the trial judge afforded the Appellant a meaningful opportunity to rebut the Appellee's testimony. That lack of notice and opportunity to defend also constitutes a violation of the Appellant's due process rights. See, e.g., Bailey v. Bailey, No. 14-94-00984-CV, 1995 Tex. App. LEXIS 2868, at *4-5 (Tex.App. Nov. 16, 1995) (stating that "[a]dequate and reasonable notice of proceedings is a fundamental element of due process" and reversing where the "appellant was not properly served with notice of the counterclaim") (citation omitted); Properties v. Hawk, No. 76AP-490, 1976 Ohio App. LEXIS 8193, at *4 (Ohio Ct.App. Dec. 21, 1976) (holding that "defenses can be asserted at the trial notwithstanding the failure to include them in the responsive pleading, while counterclaims if they are to be recovered upon must be asserted not at trial but prior to trial. . . .") (unpublished).
Furthermore, notwithstanding the Appellant's testimony to the contrary, the trial judge expressly found at the hearing that the landscaping business "does represent property that's subject to distribution by the Court." [Appellant's App'x at 33.] Based on that finding, the trial judge indicated that he would proceed to make an equitable distribution between the parties. In the divorce decree, however, the trial judge stated that "[t]here is no real or personal property requiring distribution by this Court." [ Id. at 4.] Despite his revised finding, the trial judge nevertheless memorialized in the divorce decree the award he ordered at the hearing.
This Court has observed that although not specifically defined in the Virgin Islands Code, "`marital property' has been construed to encompass any property which the couple acquired `during the marriage' and which is subject to equitable distribution upon divorce." See Fuentes, 247 F. Supp. 2d at 716.
Because the record reflects, and the trial judge explicitly found in the divorce decree, that there was no marital property requiring distribution and that both parties waived alimony, there is neither a factual nor a legal basis for the award of $45,000.
IV. CONCLUSION
For the reasons stated above, the Court will affirm the decree of divorce but vacate only that portion of the decree awarding $45,000 to the Appellee. An appropriate judgment follows.
JUDGMENT
PER CURIAM,
For the reasons given in the accompanying Memorandum Opinion of even date, it is hereby
ORDERED that the portion of the Superior Court's divorce decree awarding $45,000 to the Appellee is VACATED; and it is further
ORDERED that the divorce decree is AFFIRMED in all other respects.