Opinion
1D21-3894 1D22-2506
10-11-2023
Jefferey Ryan Strickland, Former Husband, Appellant, v. Jenyne Tipton Strickland, Former Wife, Appellee.
Jill W. Warren of The Virga Law Firm, Pensacola, for Appellant. Carroll L. McCauley, Panama City, for Appellee.
Not final until disposition of any timely and authorized motion under Fla. R. App. P. 9.330 or 9.331.
On appeal from the Circuit Court for Escambia County. Lacey Powell Clark, Judge.
Jill W. Warren of The Virga Law Firm, Pensacola, for Appellant.
Carroll L. McCauley, Panama City, for Appellee.
LONG, J.
Former Husband appeals a final judgment of marriage dissolution. We affirm the order in all respects but one. We reverse the trial court's equitable distribution based on its classification of the enhanced value of Biggs &Strickland as a marital asset. McGowan v. McGowan, 344 So.3d 607, 610 (Fla. 1st DCA 2022) (stating classification of assets is reviewed de novo).
Former Husband owns his dental practice, Spanish Trail Dentistry, and the company which owns the building it operates from, Biggs &Strickland. The trial court classified both companies as nonmarital assets. While this means the companies themselves do not have their value divided after marriage dissolution, "[t]he enhancement in value and appreciation of nonmarital assets resulting from the efforts of either party during the marriage or from the contribution to or expenditure thereon of marital funds or other forms of marital assets, or both," is a marital asset. § 61.075(6)(a)(1)(b), Fla. Stat.
Former Wife tried to prove that both Spanish Trail Dentistry and Biggs &Strickland increased in value during the marriage. The trial court found that Former Wife failed to show the value of Spanish Trail Dentistry increased but did show the value of Biggs &Strickland increased. That increase resulted from the paydown of the mortgage on the building. Section 61.075(6)(a)(1)(c) states "[t]he paydown of principal of a note and mortgage secured by nonmarital real property" is a marital asset "if the note and mortgage secured by the property are paid down from marital funds during the marriage." The trial court's order does not discuss this issue, but it apparently decided the funds Biggs &Strickland used to pay down the mortgage on the building were marital funds.
The only source of income of Biggs &Strickland is the rental income it receives from Spanish Trail Dentistry. This results from a lease agreement signed between the two companies in which Spanish Trail Dentistry pays a set amount of money to Biggs &Strickland to rent the space used for the dental practice. Biggs &Strickland then uses that money to pay down the mortgage. At no point does the money cross over into Former Husband's hands personally. The money went directly from Spanish Trail Dentistry to Biggs &Strickland. Both are nonmarital assets, making the money nonmarital.[*] And the rent payments were an essential expense of the nonmarital business. While a party cannot hide the results of marital efforts in a nonmarital company to avoid their classification as marital property, there was no evidence that Former Husband stored, or comingled, marital assets in his companies.
We reverse the equitable distribution portion of the judgment because the classification of the enhanced value of Biggs &Strickland as a marital asset was erroneous. We remand for a redetermination of the equitable distribution between the parties, consistent with this opinion. We affirm in all other respects.
AFFIRMED in part, REVERSED in part.
ROBERTS and TANENBAUM, JJ., concur.
[*] Former Wife did not appeal the trial court's determination that the practice was nonmarital, so we take that determination as conclusive for the purpose of this appeal.