Auction of TN Marital Residence Can Proceed, Despite Husband’s Claim That Reserve Was Too Low
Tennessee case summary on post-divorce property division enforcement.
Elizabeth Ann Morrow Granoff v. Andrew Scott Granoff
The husband and wife in this Tennessee case were divorced in 2006 after 21 years of marriage. Their property included the luxury marital home on 26 acres. The marital termination agreement provided that the property would be placed for sale, with the wife to receive $460,000, or 30% of the proceeds, whichever was higher. The agreement provided that the husband would be entitled to live in the residence until sale, and was responsible for maintenance and upkeep, as well as taxes and insurance. In 2011, after the husband was unable to sell, they agreed that the wife would be able to list, market, show, and sell the property, but that the husband had the right to continue to occupy it.
The wife ultimately received an offer of $925,000, and sought the court’s approval. The court approved the sale, and the Tennessee Court of Appeals, in a 2014 decision, affirmed.
After remand, the wife made a motion to charge the husband $10,000 per month rent. The court granted the motion, but set the rent at $6000 per month, which it later reduced to $3000. It also accepted the wife’s reserve price to sell the property at auction. The husband then filed a second appeal with the Tennessee Court of Appeals. He argued that the lower court had erred both in setting the rental obligation, and also in setting the reserve price for the property to be sold at auction.
The appeals court first noted that a Marital Termination Agreement is a contract, and general contract principles apply. In this case, the contract did not call for rent, and the Court of Appeals reversed the portion of the order providing for rent. Instead, it sent the case back for any compensation to be in accordance with the contract.
The husband also argued that the reserve price for the auction was too low. However, the appeals court noted that the trial court had considered the expert opinion of auctioneers. It also noted that the property had now been on the market for over ten years, and that the husband’s opinion of the value was probably substantially more than a reasonable reserve price.
For these reasons, the Court of Appeals modified the lower court’s ruling.
No. E2015-00605-COA-R3-CV (Tenn. Ct. App. Mar. 16, 2016).
See original opinion for exact language. Legal citations omitted.
To learn more, see Property Division in Tennessee Divorce.
