Husband Responsible for Gold Coins Missing During Divorce

Tennessee case summary on divorce.

Douglas D. Dailey v. Violet L. Dailey

The husband and wife in this Blount County, Tennessee, case had been married for about 40 years, and had divorced and remarried in 1978.  During the marriage, the husband had purchased gold coins.  During one ten-year span, he had purchased about 400 ounces.  At his deposition, the husband testified that the total spent had been about a half million dollars, but at trial, he toned down the estimate.  The wife testified that he had given estimates of $750,000 and a million dollars as the total value.

The gold coins were kept in a gun safe.  When the parties’ son (who was 32 at the time of trial) was in his teens, there was evidence that he had taken some of the coins out of the unlocked safe after the husband allegedly destroyed some of the son’s collectible cards.  The son testified that he took 2 or 3 coins, but the husband testified that the son took almost 50 ounces.

The wife testified that after the 1978 divorce, she took 3 to 5 coins to pay legal fees, but the husband alleged that she had taken about 100 ounces.

Eventually, the husband started storing the gold in a safe deposit box, and he estimated that there were 200 ounces in the box.

In 2016, their church had a prophecy that President Obama would refuse to leave office, and as a result, they wouldn’t be able to get the gold out of the bank.  At the wife’s request, they moved the gold into the safe room of their home.

Late in the marriage, the husband lived in the downstairs portion of the home (with the gold), and the wife lived upstairs.  The wife admitted that she occasionally came to the lower level to get food from the freezer.  There was dispute as to whether the wife had access to the key to the safe room.

About the time he filed for divorce, he discovered the gold was missing, but he never contacted law enforcement.

Most issues were resolved, but a trial was held before Judge Tammy M. Harrington on the issue of what happened to the gold.  After hearing testimony for two days, Judge Harrington concluded that the gold was at all relevant times in the husband’s control, and that he was responsible if it was missing.  Therefore, the husband was ordered to pay the wife half the value of the gold.  The court held that the missing gold was worth $600,000, and ordered the husband to pay the wife $300,000.  Dissatisfied with this outcome, the husband appealed to the Tennessee Court of Appeals.

The appeals court began by noting that in a non-jury case, review is de novo, with a presumption of correctness of the trial court’s factual findings.

The trial court had made a finding that the husband was not credible, based upon his cavalier attitude and inconsistent and vague testimony.

The appeals court characterized the husband’s case as that he had not taken the gold.  At some point during the marriage, both the wife and son had taken some gold.  Therefore, he surmised, they must have taken the gold this time.  The appeals court, however, pointed out that the husband had no proof of the alleged theft.  It also noted that during the marriage, the gold was marital property, and any taking by the wife would not be a theft.

The appeals court agreed that the husband had control of the gold at all relevant times.  There was no evidence that the wife had a key to the safe room.  Furthermore, the husband had never mentioned the alleged theft to law enforcement, or even in the divorce filings.

For these reasons, the Court of Appeals affirmed the lower court’s ruling.  It awarded the wife her attorney’s fees on appeal and sent the case back for a calculation of those fees.

No. E2019-00928-COA-R3-CV (Tenn. Ct. App. July 13, 2020).

See original opinion for exact language.  Legal citations omitted.

To learn more, see Property Division in Tennessee Divorce.