Separate Property Can Become Marital Property Simply if the Other Spouse’s Contribution of Income to the Marriage

Henshaw v. Henshaw, 2012 UT App. 56, Utah Court of Appeals, February 24, 2012

Husband and Wife were divorced.  Wife was awarded half of the equity in a ranch and adjoining property that Husband inherited and paid for with inherited money.  In the time leading up to trial, Husband went through 3 attorneys and file a motion to recuse the judge in order to extend the time until trial.  The trial court found that he violated rule 11.  Husband appealed the property distribution and the Rule 11 findings.

The Court of Appeals declined to disturb the trial court’s finding that Wife contributed to the maintenance of the ranch and that Wife’s parents loaned the parties money to cover their needs and allow them to purchase the additional land and maintain the ranch.  As to the classification of the adjoining property as marital property, Husband failed to properly marshal the evidence and as such, the Court refused to overturn the trial court’s decision.  Further, because of Wife’s contribution of income and contributions to the ranch, it was not an abuse of discretion to award her 50% of the value of the premarital property.  However, the Court found that the Ranch could not be ordered sold because it was already sold.  The Court affirmed the trial court’s division of the value and remanded the issue to determine Wife’s remedy.

Further, Husband’s actions of attempting to delay the proceedings properly resulted in Rule 11 Sanctions.

Full opinion available at: http://www.utcourts.gov/opinions/appopin/henshaw022412.pdf  

Detailed and Unchallenged Expert Testimony is Sufficient Basis for Trial Court Findings

Liston v. Liston, 2011 UT app 433, December 22, 2011

Husband appealed the Decree which found wife’s credit card accounts and Husband investment accounts to be marital property. The trial court further awarded wife a sum of money for her ½ interest in water rights associated with the marital home. Husband Appealed.

Court of Appeals affirmed the trial court’s finding that Wife’s detailed and specific explanation that the credit card expenses were marital expenses was more credible when compared to Husband’s lack of explanation of the credit card expenses.  Indeed, Husband’s testimony that he had no idea of what expenses were on the Credit Cards displayed his ignorance on the issue.

Husband had a sizeable investment account to which he added funds that he claimed were from his mother.  The combined amounts were then placed in an account held solely in Wife’s name, then the entire amount (including Wife’s investments) were transferred into an account held in Husband’s deceased mother’s name.  Upon distribution, the Court described how it determined that Husband original investment in the account along with other token investments and interest thereon was Husband’s separate property. The remainder, including the portion that allegedly came from Husband’s mother, the Court found to be marital.   The Court of Appeals affirmed the trial court based on the trial court’s detailed findings and reliance on the CPA report.

Husband argued that the water rights were resolved in the parties’ partial stipulation.  As part of the stipulation husband was awarded the marital home and water rights “appurtenant thereto.”  An unchallenged expert testified that three of the four shares were not appurtenant to the home, but could be sold separately.  Court affirmed the trial court based on the expert’s unchallenged testimony.

Full opinion available at: http://www.utcourts.gov/opinions/appopin/liston122211.pdf

Placing Property in Joint-Tenancy Does Not Always Mean Marital Property

Poll v. Poll, 2011 UT App 307, Utah Court of Appeals September 9, 2011

Husband and Wife were married in April 2005.  Wife had substantial amount of money in trust which she used to purchase the parties’ home.  Both parties were listed on the deed.  At divorce the trial court awarded the home in its entirety to wife because of her separate investment in the home.  Husband appealed.

The Court of Appeals found that under Bradford, a transfer of otherwise separate property to joint tenancy with the grantor’s spouse is generally presumed to be a gift and, when coupled with an evident intent to do so, effectively changes the nature of the property to marital property.  In this case, Wife lacked the evident intent to transfer the property to marital property.  The parties made substantial efforts to keep all their accounts separate, which bolstered Wife’s testimony that she had not intent of making the house a gift to the marital estate or to husband.  Affirmed.

Full opinion available at:  http://www.utcourts.gov/opinions/appopin/poll090911.pdf

Property Not Properly Conveyed Away from the Marital Estate is Marital Property; and Fraud Tolls Statute of Limitations on Quiet Title Actions

Grgich v. Grgich, 2011 UT App 214 (Utah Court of Appeals, June 30, 2011)

Husband and Wife divorced. Wife was awarded 1/2 interest in the parties farm estate where the parties had lived for the majority of the marriage.  Husband appealed claiming the property was deeded to the minor children and Wife's challenge of the deed was barred by the statute of limitations.  The trial court had concluded that Husband's acts of mortgaging the land without permission and over the objection of the children showed his lack of present intent to transfer when he deeded it to his children.  Because he lacked the present intent to transfer, the transfer to the children was invalid.  Further, the trial court found even he had the intent to transfer the property his fraud on Wife tolled the statute of limitations as to Wife because Husband himself had told Wife that it was invalid.  She relied on his statement and his actions of unilaterally mortgaging the property as proof that he was the one true owner.

The Court of Appeals affirmed.

Full Decision available at  http://www.utcourts.gov/opinions/appopin/grgich063011.pdf

Passage of Time Itself is not Enough to Invalidate a Divorce Agreement and Post Separation Mortgage Payments Entitle Payor to More Equity

Jacobsen v. Jacobsen, 2011 UT App 161 (Utah Court of Appeals, May 19, 2011).

Parties signed a “divorce agreement” in May 2001 and filed for divorce until 2005. The Trial court upheld the agreement. The trial court also awarded Husband a disproportionate portion of the equity because of his use of inheritance and separate income to retire the mortgage after separation. Wife Appealed.

The Court of Appeals found that Wife had marshaled much of the evidence, but failed to illustrate the “fatal flaw.” It is not enough to merely present all the evidence; the appellant must demonstrate why the evidence is insufficient. The Court also found that the passage of time does not invalidate the agreement.

The Court of appeals further found husband’s payments from post separation income and separate property used to retire the mortgage entitled him to a disproportionate amount of equity.

Wife appealed on several other grounds, but failed to preserve some issues and her other arguments were simply not supported by the evidence.

Full Decision available at http://www.utcourts.gov/opinions/appopin/jacobsen051911.pdf

Only the Commingled Portion of Premarital Property is Distributed and A Negative Inference is Drawn Against a Non-Producing Party Who Should Have the Records

Keiter v. Keiter, 2010 UT App. 169, (Utah Court of Appeals June 24, 2010).

In the Decree of Divorce, the trial court determined that a piece of separate real property was commingled with marital property and equitably distributed the entire piece of real property.  Husband Appealed. 

The piece of property was held as a portion of Husband’s defined benefit plan that he began contributing to before the marriage.  During the marriage, Husband made several payments on the land.  Husband failed to show the court where the money for these payments had come from.  The Court found that a negative inference about missing documentation is to be drawn against the party who should have possession of the records.  Because Husband failed to produce the records, Husband could not support his claim that the property was premarital and not subject to distribution. 

Therefore, the Court affirmed the finding that the property was commingled.  However, the Court found that the entire property was not subject to distribution and remanded the case for the trial court to distribute only the commingled portion, reserving the premarital portion to Husband.

Full Decision available at  http://www.utcourts.gov/opinions/appopin/keiter062410.pdf