Young v. Young ( 2018 )

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.
IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE
In re the Marriage of:
SCOTT JAY YOUNG,
Petitioner/Appellee,
v.
MONIQUE MARIE YOUNG,
Respondent/Appellant.
No. 1 CA-CV 17-0302 FC
FILED 5-17-2018
Appeal from the Superior Court in Yuma County
No. S1400DO201600901
The Honorable Roger A. Nelson, Judge
AFFIRMED IN PART; VACATED AND REMANDED IN PART
COUNSEL
Mary Katherine Boyte, PC, Yuma
By Mary K. Boyte Henderson
Counsel for Petitioner/Appellee
S. Alan Cook, PC, Phoenix
By S. Alan Cook
Counsel for Respondent/Appellant
YOUNG v. YOUNG
Decision of the Court
MEMORANDUM DECISION
Presiding Judge Diane M. Johnsen delivered the decision of the Court, in
which Judge Kent E. Cattani and Judge Jennifer M. Perkins joined.
J O H N S E N, Judge:
¶1 Monique Young ("Wife") appeals the distribution of property
in her dissolution decree. For the following reasons, we affirm the decree
in part and vacate and remand in part.
FACTS AND PROCEDURAL BACKGROUND
¶2 Wife and Scott Young ("Husband") married in September
1999. Over time, their community property came to include a home, several
automobiles and two retirement accounts in Husband's name – a Federal
Employee Retirement Systems account and a Thrift Savings Plan that was
subject to favorable tax treatment. As of June 2016, when Husband filed a
petition for dissolution, the Thrift Savings Plan was valued at almost
$316,000. The couple also incurred debts including a credit card obligation,
an auto loan and a mortgage on the home.
¶3 Wife was tardy for the commencement of the dissolution trial;
after a delay, the court proceeded in her absence. Wife eventually arrived,
but before she did, Husband's counsel suggested to the court that if it
divided the Thrift Savings Plan through a qualified domestic relations
order, Wife might withdraw her share all at once, causing her to incur taxes
and penalties. Counsel suggested that to avoid that outcome, the court
direct that the division of the Thrift Savings Plan be accomplished by
ordering Husband to pay Wife $1,500 a month for 84 months. At the close
of the hearing, the court appeared to accept Husband's suggestion about
how to divide the Thrift Savings Plan. At the same time, the court rejected
Wife's request for spousal maintenance:
I have also reviewed or considered the request of [Husband]
regarding financial issues in this case. I do not believe – I do
not find that spousal maintenance is appropriate, but I do find
that the proposal to pay to [Wife] her share of the Thrift
Savings Plan through monthly payments of $1500 a month for
a period of seven years is appropriate. I find that that is fair
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under the circumstances. [Wife] will receive her share of that
community property.
¶4 The court then asked Husband's counsel to prepare the
decree, which the court later entered. As submitted and as signed by the
court, the decree awarded to Husband "[a]ll accrued benefits in Husband's
Federal Thrift Savings Plan," but also stated that "[Husband] shall pay to
[Wife] the sum of $1,500.00 per month as and for spousal maintenance for a
period of eighty-four (84) months." (Emphasis added.)
¶5 Wife timely appeals from the decree. We have jurisdiction
pursuant to Article 6, Section 9, of the Arizona Constitution and Arizona
Revised Statutes ("A.R.S.") sections 12-120.21(A)(1) (2018), -2101(A)(1)
(2018) and 25-325(A) (2018).1
DISCUSSION
¶6 In a proceeding to dissolve a marriage, the superior court
"shall assign each spouse's sole and separate property" and "shall also
divide the community, joint tenancy and other property held in common
equitably, though not necessarily in kind, without regard to marital
misconduct." A.R.S. § 25-318(A) (2018). An equitable division "means just
that – it is a concept of fairness dependent upon the facts of particular
cases." Kelly v. Kelly, 198 Ariz. 307, 309, ¶ 8 (2000) (quoting Toth v. Toth, 190
Ariz. 218, 221 (1997)). All property acquired by each spouse during the
marriage before service of the petition is community property except for
property that was "[a]cquired by gift, devise or descent." A.R.S. § 25-211(A)
(2018). "Likewise, all debt incurred by either spouse during marriage is
presumed a community obligation." In re Marriage of Flower, 223 Ariz. 531,
535, ¶ 12 (App. 2010).
¶7 As for spousal maintenance, the superior court "may grant a
maintenance order for either spouse" upon finding one of four statutory
grounds. A.R.S. § 25-319(A) (2018). Upon such a finding, the superior court
may order spousal maintenance "in an amount and for a period of time as
the court deems just, without regard to marital misconduct, and after
considering all relevant factors, including" several listed in the statute.
A.R.S. § 25-319(B); see also Sherman v. Sherman, 241 Ariz. 110, 114, ¶ 17 (App.
2016).
1 Absent material revision after the relevant date, we cite the current
version of a statute or rule.
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Decision of the Court
¶8 We review the superior court's distribution of property and
grant of spousal maintenance for abuse of discretion. Bell-Kilbourn v. Bell-
Kilbourn, 216 Ariz. 521, 523, ¶ 4 (App. 2007) (property); Sherman, 241 Ariz.
at 114, ¶ 17 (maintenance). The superior court abuses its discretion by
committing an error of law or by making a discretionary ruling
unsupported by the record. Boyle v. Boyle, 231 Ariz. 63, 65, ¶ 8 (App. 2012).
We view the evidence in the light most favorable to upholding the superior
court's ruling and will affirm if reasonable evidence supports it. Boncoskey
v. Boncoskey, 216 Ariz. 448, 451, ¶ 13 (App. 2007).
¶9 We review the interpretation of a dissolution decree de novo.
Palmer v. Palmer, 217 Ariz. 67, 69-70, ¶ 7 (App. 2007). In interpreting a
dissolution decree, we will apply general rules of construction. Cohen v.
Frey, 215 Ariz. 62, 66, ¶ 11 (App. 2007); see In re Marriage of Zale, 193 Ariz.
246, 249-50, ¶¶ 13-15 (1999). Furthermore, we must construe the court's
intention from all parts of the judgment, Lopez v. Lopez, 125 Ariz. 309, 310
(App. 1980), and, "[i]f possible, a construction will be adopted that supports
the judgment, rather than one that destroys it," Title Ins. Co. of Minn. v.
Acumen Trading Co., Inc., 121 Ariz. 525, 526 (1979) (citing Paxton v.
McDonald, 72 Ariz. 378 (1951)). In other words, "[w]here a judgment is
susceptible of two interpretations, that one will be adopted . . . which makes
the judgment harmonize with the facts and law of the case and be such as
ought to have been rendered." Paxton, 72 Ariz. at 383-84.
¶10 Wife argues the court denied her an equitable share of
community property by awarding Husband the entirety of the Thrift
Savings Plan. She further contends that, to the extent the court intended to
grant her a share of the Thrift Savings Plan by ordering Husband to make
monthly spousal maintenance payments, the court erred because it may not
award spousal maintenance to equalize an otherwise inequitable
distribution of community property. In support of this argument, Mother
cites Buttram v. Buttram, 122 Ariz. 581, 582 (App. 1979). On this point,
Buttram was superseded by § 25-318(R), which states that "[i]f any part of
the court's division of joint, common or community property is in the nature
of child support or spousal maintenance, the court shall make specific
findings of fact and supporting conclusions of law in its decree." See 2008
Ariz. Legis. Serv. Ch. 124 (S.B. 1112). Nevertheless, the decree the court
entered here lacks the appropriate findings of fact and conclusions of law
necessary to divide community property in such a manner. See A.R.S. §§
25-318(R), -319(A-B).
¶11 Husband asserts the decree mistakenly characterized the
$1,500 payments as spousal maintenance and that the superior court
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Decision of the Court
decided not to award any maintenance payments. He further contends the
mandated monthly payments were an appropriate means of equitably
dividing the Thrift Savings Plan. Husband argues the superior court did
not abuse its discretion in dividing the community property, given that it
also ordered him to pay the community debts, including a mortgage of
$20,000 more than the value of the home. See Miller v. Miller, 140 Ariz. 520,
522 (App. 1984) ("[D]istribution need not be in kind or exactly equal, but
must result in substantial equality.").
¶12 In response to Husband's contention that the monthly
payments were intended as a means of distributing Wife's interest in the
Thrift Savings Plan, Wife argues the payments did not constitute an
equitable distribution of the community's interest in that account. She
asserts that her share of the Thrift Savings Plan was worth at least $157,850
at the time Husband filed the dissolution petition, and that the monthly
payments the court ordered paid over time will total only $126,000.
¶13 The record supports Husband's contention that the superior
court did not intend to order the monthly $1,500 payments as spousal
maintenance, but instead intended the payments as a means of distributing
the community's interest in the Thrift Savings Plan. The court made no
findings pursuant to § 25-319 in support of a spousal maintenance award;
moreover, as noted, at the conclusion of the hearing, it stated it did "not find
that spousal maintenance is appropriate."
¶14 Viewed as a means of distributing to Wife her share of the
Thrift Savings Plan, however, the total of the monthly payments ordered to
be paid over 84 months falls considerably short of an equal division of the
monies in the plan at the time of trial. Apart from that shortfall, which is
not insignificant, the monthly payments mandated in the decree are taxable
to her, meaning that even if she were to deposit them in a newly created
retirement plan, the sum of her cumulative deposits would be less than half
of the account the court was charged with dividing. And she would lose a
considerable amount of the cumulative appreciation in value of the monies
in the Thrift Savings Plan during the 84-month payout period.
¶15 Husband contends that the differential between Wife's share
of the Thrift Savings Plan and the total of the periodic payments is an
equitable offset for his assumption of the community debt. But according
to the pretrial statement Husband filed, he had agreed to accept the marital
home and the associated mortgage, even while acknowledging the
community's interest in the Thrift Savings Plan. Moreover, Husband's
argument does not account for the fact that, by characterizing the monthly
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payments as spousal maintenance, the decree allows him to deduct those
payments for tax purposes, thereby exacerbating the unequal division of
the account between Husband and Wife.
¶16 As a general matter, "all marital joint property should be
divided substantially equally unless sound reason exists to divide the
property otherwise." Toth, 190 Ariz. at 221. Here, the superior court noted
no "sound reason" in the decree to deny Wife a substantially equal share of
the community's interest in the Thrift Savings Plan. Accordingly, we vacate
and remand for reconsideration the court's distribution of the community's
interest in the Thrift Savings Plan. At the same time, we direct the superior
court to clarify whether Wife is entitled to an award of spousal maintenance
and, if so, the amount of such award. See A.R.S. § 25-319.
¶17 Wife also argues the superior court erred in failing to award
her half the value of the vacation and personal-leave time Husband accrued
during the marriage. We will not address that issue because she did not
raise this argument in the superior court. See Payne v. Payne, 12 Ariz. App.
434, 435-36 (1970). The same is true with her contention on appeal that the
court erred by not dividing unspecified community accounts. Nothing in
this decision, however, precludes Mother from raising these issues in the
superior court on remand.
CONCLUSION
¶18 For the foregoing reasons, we affirm the dissolution decree
except that we vacate and remand, for further proceedings consistent with
this decision, the portions of the decree addressing spousal maintenance
and division of the Thrift Savings Plan. Based on the record, which shows
that Husband has greater financial resources than Mother, and contingent
on her compliance with Arizona Rule of Civil Appellate Procedure 21, we
grant Wife her costs on appeal and her reasonable attorney's fees, pursuant
to A.R.S. § 25-324(A) (2018).
AMY M. WOOD • Clerk of the Court
FILED: AA
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