Very good and interesting case that originated out of Bradley County and has a new opinion from the Court of Appeals – in Merkel v. Merkel, the maternal grandfather intervened in the divorce action to protect his interests and likewise to keep a spouse from unfairly benefiting from the gifts he gave to his daughter during the marriage.  During the marriage, the grandfather had spent several thousand dollars and paid cash for a house for his daughter who then reconciled with her husband.  She subsequently filed for divorce, and her father intervened in the divorce action to make sure husband paid debt owed to his father-in-law and to protect the custody division.  He also laid out almost $70,o00 of payments he had made to the couple during the marriage.

The Husband argued the property was marital and there had been an oral agreement to purchase it from the Father-in-law, but Tennessee does not allow for oral contracts to purchase property.  There had been no appreciation in the property and the Father-in-law was found to have paid all the property expenses, and the court granted Wife a half-interest in the property with her father.  The Court also awarded a judgment of $15,000 to the father-in-law for payments made for vehicles operated by the Husband, an unpaid utility bill for when husband was in the home, and $3660 the Husband borrowed to repay the Dept. of Labor.

The Court of Appeals put emphasis on the following:  “a third person cannot intervene in a divorce suit for the purpose of opposing the divorce, but intervention may be allowed where it is necessary to secure justice, and third persons whose property interests may be adversely affected may intervene to protect their rights.”  Further with regards to the property, the Court pointed out that TCA 36-4-121(b)(2)(D) (2014) that defines separate property says it includes “property acquired by a spouse at any time by gift, bequest, devise or descent.”  Hence, it doesn’t matter that Wife was gifted the property during the marriage, it is still protected as separate property, and here there doesn’t even appear to have been any evidence of commingling as the Father-in-law paid all the bills, which matters since marital property “includes income from, and any increase in the value during the marriage of, property determined to be separate property in accordance with subdivision (b)(2) if each party substantially contributed to its preservation and appreciation.”  See TCA 36-4-121(b)(1)(B)(i).   Property division can be difficult even for counsel, which is why it is so important that if you have property you hire a good divorce lawyer to help you navigate these complicated waters.

Side note in this case:  Good instructions Re: paramour clauses and restraining orders involving third parties – better have some proof!  The Court of Appeals overturned the restraining provision that ordered the Mother/Wife from allowing her friend in the presence of the two minor children.  Here the testimony was that this person was a friend who did not have a criminal background, which gives the Court no grounds for the restriction.

To read the Merkel decision in full, click HERE or cut and paste this link:

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