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IN THE COURT OF APPEALS OF THE STATE OF MISSISSIPPI NO. 96-CA-00118 COA JUDY L. EDWARDS v. GEORGE W. EDWARDS, JR. APPELLANT APPELLEE

THIS OPINION IS NOT DESIGNATED FOR PUBLICATION AND MAY NOT BE CITED, PURSUANT TO M.R.A.P. 35-B DATE OF JUDGMENT: TRIAL JUDGE: COURT FROM WHICH APPEALED: ATTORNEY FOR APPELLANT: ATTORNEYS FOR APPELLEE: NATURE OF THE CASE: TRIAL COURT DISPOSITION: DISPOSITION: MOTION FOR REHEARING FILED: CERTIORARI FILED: MANDATE ISSUED: 01/02/96 HON. JASON H. FLOYD JR. HARRISON COUNTY CHANCERY COURT KAYE J. PERSONS HENRY LAIRD ANNE SCHAEFER WARREN CIVIL - CONTRACT PROMISSORY NOTE FOUND NOT ENFORCEABLE AFFIRMED - 9/23/97

10/14/97

BEFORE BRIDGES, C.J., HINKEBEIN, AND KING, JJ. KING, J., FOR THE COURT: Judy L. Edwards filed a complaint against her ex-husband, George W. Edwards, Jr. seeking to enforce a promissory note. The Chancery Court of Harrison County found the note unenforceable because it lacked consideration. Aggrieved, Judy Edwards perfected this appeal alleging that the chancellor erred in denying and dismissing the complaint and prayer for relief based upon a failure or want of consideration. We affirm. FACTS Judy Edwards and George W. Edwards, Jr. were married for thirty-five years and had two daughters.

Mrs. Edwards filed for a divorce in 1992. In 1993, she filed a separate action in the Harrison County Circuit Court to enforce a promissory note and letter agreement executed by Mr. Edwards. The court transferred the suit to the Harrison County Chancery Court and consolidated it with the divorce action. The chancery court severed the divorce proceedings and preserved the action to enforce the promissory note for subsequent disposition. The court granted the divorce in 1994. In 1995, the court heard the suit to enforce the promissory note. Testimony revealed that in the early 1980's, the Edwards family began to experience financial difficulties. Mr. Edwards, who had financially supported the family until that time, had investments that went sour and caused him to loose large sums of money. Bills were not being paid, and creditors made constant demands for payment. Mr. Edwards believed that bankruptcy was eminent. About this same time, Mrs. Edwards inherited $150,000. The inherited funds were used to support the family. Mrs. Edwards paid doctor bills, tuition, and provided the every day needs of the family. In 1981, Mr. Edwards quitclaimed all of his interest in the family home to Mrs. Edwards. Mr. Edwards testified that he executed the quit claim deed in order to protect Mrs. Edwards's interest in the home from creditors. One of whom had received a large judgment against Mr. Edwards in a recent law suit. Mrs. Edwards testified that she used the inheritance to pay the mortgage and maintain and make improvements to the home. In 1983, Mr. Edwards executed a promissory note in the amount of $100,000 with Mrs. Edwards as the payee. Mr. Edwards promised to repay Mrs. Edwards in ten annual installments of $10,000 each beginning on the first day of November 1984 and each year after that for a period of ten years. The Edwards's attorney also prepared a contemporaneous letter agreement, which provided for alternative payments of $5,000 if Mr. Edwards could not make the $10,000 payments. Mrs. Edwards never transferred to Mr. Edwards any sum of money as consideration for the promissory note. Mr. Edwards testified that the document was created in anticipation of his having to file bankruptcy and hoped it would afford some protection to Mrs. Edwards from his creditors. Nick Roberts, Jr., the Edwards's attorney, testified that the promissory note was executed in an attempt to afford Mrs. Edwards some protection from creditors in the event of bankruptcy. He stated that the Edwards needed to be able to show Mrs. Edwards's investment in the house. Mrs. Edwards testified that she had no such understanding. She stated that she believed that Mr. Edwards would honor the note as repayment for her having used the inheritance to support the family and maintain the family home. The chancellor found that Mr. and Mrs. Edwards had no arms length bargained for exchange, and that Mrs. Edwards had invested in the family home for the mutual benefit of the family. Additionally, Mr. Edwards quitclaimed his interest in the property, and Mrs. Edwards invested the money in the house and family some time before the execution of the promissory note. The chancellor determined from the testimony that Mr. Edwards never intended to repay the money and that the note was intended to protect Mrs. Edwards interests from creditors. The chancellor held that because there was no consideration for the note, Mrs. Edwards could not enforce it against Mr. Edwards. Mrs. Edwards perfected this appeal.

I. DID THE CHANCELLOR ERR IN DENYING AND DISMISSING MRS. EDWARDS' COMPLAINT AND PRAYER FOR RELIEF BASED UPON A FAILURE OR WANT OF CONSIDERATION? The chancellor determined that the promissory note executed by Mr. Edwards was unenforceable because there was no consideration to support it. The chancellor found that before the execution of the note Mrs. Edwards used the funds to support the family and make improvements to the family home and that there was never a transfer of the funds after the note's execution. Finding that Mrs. Edwards owned the home prior to using her inherited funds to make any improvements, the chancellor held that Mr. Edwards received no benefit that he was legally required to repay. The chancellor found that Mr. Edwards intended only to protect his wife's investment in the property from his creditors. The chancellor held that because Mr. Edwards received no benefits by executing the note, his promise to repay it was a voluntary promise without consideration except mere goodwill or natural affection. Mrs. Edwards argues that the note was enforceable. She contends that

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