Morrison and Chierichetti , 321 Or. App. 491 ( 2022 )

491
Argued and submitted May 9, affirmed August 31, 2022
In the Matter of the Marriage of
Holly Ann MORRISON,
Petitioner-Respondent,
and
Paul Francis CHIERICHETTI,
Respondent-Appellant.
Josephine County Circuit Court
20DR08353; A176188
516 P3d 1196
Husband appeals from a judgment dissolving the parties’ marriage, chal-
lenging the trial court’s division of marital property. He argues that the trial
court erred in its division of two properties by awarding wife one-half of the
equity in properties for which husband provided the down payment. Held: The
trial court did not err. The trial court properly considered commingling as one
of the factors in making a “just and proper” distribution of marital property,
because the interrelation of the parties’ finances determines whether a marriage
is considered “short term,” not the temporal length of the marriage. The evidence
in the record supported the trial court’s determination that husband intended
the properties to be marital assets. Accordingly, it was within the range of legally
permissible outcomes for the trial court to conclude that the parties commingled
the properties and to award wife one-half of the equity in those properties.
Affirmed.
Sarah E. McGlaughlin, Judge.
Melisa A. Button argued the cause for appellant. Also on
the briefs was Stefanie L. Burke.
George W. Kelly argued the cause and filed the brief for
respondent.
Before Powers, Presiding Judge, and Lagesen, Chief Judge,
and Hellman, Judge.
HELLMAN, J.
Affirmed.
492 Morrison and Chierichetti
HELLMAN, J.
Husband appeals from a judgment dissolving the
parties’ marriage, challenging the trial court’s division of
marital property. He argues that the trial court erred in its
division of two properties by awarding wife one-half of the
equity in properties for which husband provided the down
payment. We conclude that the trial court did not err in its
methodology and that the resulting distribution was within
the range of permissible legal outcomes. Accordingly, we
affirm.
BACKGROUND
We are bound by the trial court’s factual findings
that are supported by the evidence, and we state the facts
consistent with the trial court’s express and implied find-
ings. Maldonado and Freed, 294 Or App 583, 585, 432 P3d
1154 (2018).1
The parties met in 2016 and were married in May
2018. At the time of their marriage, wife was 57 years old,
and husband was 67 years old. In September 2017, the par-
ties purchased a property in Josephine County to serve
as their marital home (Wagon Wheel). Wife helped locate
Wagon Wheel and husband provided the $430,000 down
payment using cash from his premarital assets. Wife did
not financially contribute to the purchase of Wagon Wheel,
but she made decisions regarding the home’s renovations,
and both her and husband’s names were on the home’s title.
Wife sold her premarital home and moved into
Wagon Wheel alone prior to the marriage. Referring to him-
self as “Paul the Provider,” husband supported wife’s plans
to give away and wind down her cleaning and fiduciary
businesses and promised to financially support her. Before
the May 2018 marriage, wife testified that the parties had
discussed a prenuptial agreement with husband’s attorneys,
but they decided not to establish one because they believed
they would never divorce.
1
Neither party has requested de novo review, and, because this is not an
exceptional case, we decline to exercise our discretion to review de novo. See
ORS 19.415(3)(b) (court has discretion to apply de novo review in equitable
actions); ORAP 5.40(8)(c) (court will exercise de novo review only in exceptional
circumstances).
Cite as 321 Or App 491 (2022) 493
By August 2018, about three months into their mar-
riage, husband had moved out of Wagon Wheel and back
into his premarital home. The parties continued to live sep-
arately for the remainder of their marriage.
In June 2019, the parties purchased a second prop-
erty in Multnomah County (Yamhill). Wife located Yamhill
and husband again provided the down payment, using
$400,000 that he had inherited during the marriage. The
parties took out a joint mortgage to cover the remaining
$145,000. Yamhill had two living areas, one that the parties
intended to stay in together when they visited Portland and
a second that the parties leased to tenants. Wife and her
daughter opened a joint checking account, into which they
deposited rental income and from which wife wrote checks
to pay contractors.
Despite living in separate homes during this time,
the parties continued to share finances. The parties con-
tinued to pay their bills primarily from a joint checking
account with wife writing the necessary checks. Wife con-
tributed the last $15,000 of her fiduciary income into that
bank account, but husband provided the majority of the
funds with his income. In July 2019, husband also executed
a will and trust providing that the majority of his estate
would pass to wife after distributions to his children.
Following a trial, the trial court concluded that,
because it was purchased before the marriage, Wagon Wheel
was not a marital asset and husband’s $430,000 down pay-
ment was therefore not subject to the presumption of equal
contribution.2 Because Yamhill was purchased during the
marriage, the trial court concluded that Yamhill was subject
to the presumption of equal contribution. The trial court,
however, concluded that husband rebutted the presumption
of equal contribution as to the $400,000 down payment that
came from his inheritance.
The trial court then considered whether a “just
and proper” distribution would require that wife receive a
2
The trial court distinguished that the appreciation of Wagon Wheel during
the marriage was a marital asset and split the appreciation equally in accor-
dance with the presumption of equal contribution. Husband does not challenge
the equal split of the appreciation in either property.
494 Morrison and Chierichetti
portion of husband’s contributions to the purchase of Wagon
Wheel and Yamhill. Within that analysis, the trial court
determined that husband’s contributions had been com-
mingled to such an extent as to become part of the marital
estate. The court found that husband’s intent to share the
value of his contributions with wife was evidenced by:
• The parties holding joint title to Wagon Wheel and
Yamhill and sharing the mortgage for Yamhill
since the time of acquisition.
• The parties’ intent to reside at Wagon Wheel as a
married couple.
• Wife’s continued residence at Wagon Wheel even
after husband moved to another property.
• The parties’ purchase, almost a year after husband
moved out of Wagon Wheel, of another property
that they intended to live at together and to which
they held joint title.
• Husband’s execution of a will leaving the majority
of his estate to wife.
• The parties’ express decision not to execute a pre-
nuptial agreement.
• Husband’s testimony at trial that he intended
the properties to be owned by both parties “[i]n
marriage.”
• Wife’s control of the renovation decisions for the
properties and work with the property management
company for Yamhill.
The trial court also found that it was equitable to
award wife a portion of husband’s contributions because she
gave away her cleaning business and stopped taking fidu-
ciary work in reliance on husband’s encouragement to rely
on him to provide for her financial needs.
Based on those equitable considerations, the trial
court awarded wife one-half of the remaining proceeds of
both properties after payments for mortgage debt, repairs,
and an equalizing judgment to husband.
Cite as 321 Or App 491 (2022) 495
On appeal, husband argues that the trial court
erred in determining that it was just and proper to award
one-half of the equity to wife. He argues that the court erred
in solely focusing on whether the property was commingled,
failing to take into account the short-term nature of the par-
ties’ marriage, and ultimately determining that the proper-
ties were commingled. Wife responds that the trial court’s
division of property was just and proper and fell within the
range of legally permissible outcomes.
STANDARD OF REVIEW
We review the trial court’s resolution of legal ques-
tions for errors of law, and we review the trial court’s ulti-
mate determination as to what overall property division
is just and proper for an abuse of discretion. Maldonado,
294 Or App at 589-90. We will not disturb the trial court’s
division unless the trial court misapplied the statutory and
equitable considerations required by ORS 107.105. Id. at
590.
LEGAL FRAMEWORK
Property division upon dissolution of marriage is
governed by ORS 107.105(1)(f), which provides:
“Whenever the court renders a judgment of marital
annulment, dissolution or separation, the court may pro-
vide in the judgment:
“* * * * *
“(f) For the division or other disposition between the
parties of the real or personal property, or both, of either or
both of the parties as may be just and proper in all the cir-
cumstances. * * * [T]here is a rebuttable presumption that
both parties have contributed equally to the acquisition of
property during the marriage, whether such property is
jointly or separately held.”
There are therefore two types of property at issue
in a dissolution. First, “marital assets” are real or personal
property acquired by either spouse during a marriage. Kunze
and Kunze, 337 Or 122, 133-34, 92 P3d 100 (2004). The pre-
sumption of equal contribution applies to marital assets and
directs the court that, unless proven otherwise, the court
496 Morrison and Chierichetti
must find that both parties have contributed equally to the
acquisition of marital assets. Hostetler and Hostetler, 269 Or
App 312, 319, 344 P3d 126 (2015). If, however, a spouse suc-
cessfully rebuts the presumption of equal contribution, then
“the party holding the separate asset is entitled to receive
the property in the division of marital assets unless other
considerations make it ‘just and proper in all the circum-
stances’ to distribute the property otherwise.” Loomis and
Loomis, 247 Or App 127, 136, 268 P3d 700 (2011) (quoting
ORS 107.105(1)(f); internal citations omitted).
Regardless of whether the presumption of equal
contribution to marital assets is rebutted, then, ORS 107.105
ultimately requires courts to distribute marital assets
as may be just and proper under all the circumstances.
Fuernsteiner-Perin and Perin, 211 Or App 23, 31, 153 P3d
151 (2007).
The second type of marital property, premarital
assets, are assets acquired before marriage and are not sub-
ject to the presumption of equal contribution. Van Winkel
and Van Winkel, 289 Or App 805, 811, 412 P3d 243, rev den,
363 Or 224 (2018). Like marital assets, premarital assets
are ultimately subject to any distribution that is “just and
proper in all the circumstances.” ORS 107.105(1)(f).
Determining what is just and proper in a given dis-
solution requires the court to take a holistic view of all the
circumstances of the parties. Fuernsteiner-Perin, 211 Or App
at 31. That inquiry “takes into account the social and finan-
cial objectives of the dissolution, as well as any other consid-
erations that bear upon the question of what division of the
marital property is equitable.” Kunze, 337 Or at 135. Some
of the equitable considerations include the preservation of
assets; the achievement of economic self-sufficiency for both
spouses; the particular needs of the parties and their chil-
dren; and the extent to which a party has integrated a sep-
arately acquired asset into the common financial affairs of
the parties through commingling. Id. at 136.
APPLICATION
Within the legal framework, the parties focus their
arguments on the trial court’s decision that wife was entitled
Cite as 321 Or App 491 (2022) 497
to a portion of husband’s contributions to Wagon Wheel and
Yamhill under a just and proper analysis.
We understand husband to argue that the trial
court committed two legal errors in its property division.
First, husband asserts that the trial court relied solely on
commingling, which, he contends, was error under Massee
and Massee, 328 Or 195, 210, 970 P2d 1203 (1999). Second,
husband asserts that it was legally impermissible for the
trial court to have concluded that the parties commingled
the properties into their joint financial affairs due to the
short-term nature of the parties’ marriage. We disagree
with both arguments.
Although husband argues that the trial court’s focus
on commingling was legal error under Massee, the record
demonstrates that the trial court followed the correct meth-
odology in determining a just and proper distribution. The
trial court first correctly identified the statutory and equi-
table factors that guide a just and proper analysis. It then
went on to discuss the factor of commingling as well as the
considerations that husband had encouraged wife to retire,
sell her home, and rely on him financially. The trial court
is not required to provide a detailed analysis on each of the
factors to demonstrate that it understood and followed the
correct legal methodology for property division. Thus, this
case is unlike Massee, where the Supreme Court determined
that the trial court failed to consider the statutory factors
and relied solely on the short-term nature of the marriage.
As to husband’s second argument that it was legally
impermissible to find commingling given the short-term
nature of the marriage, husband’s focus on the short period
that the parties lived together is misplaced. For one, it dis-
counts that the parties remained married for an additional
19 months after they ceased living at the same physical
address. In addition, a “short-term” marriage is defined not
only by reference to the length of the marriage, but, more
importantly, by the absence of commingling. See Jenks and
Jenks, 294 Or 236, 242, 656 P2d 286 (1982) (defining a short-
term marriage as one in which the “the marriage is termi-
nated before the parties’ affairs become commingled * * * to
the point that the parties cannot readily be restored to their
498 Morrison and Chierichetti
pre-marital situations”); Van Winkel, 289 Or App at 814 (dis-
cussing that the two-year length of the marriage was not a
determining factor; rather, the issue was whether the par-
ties’ financial arrangement, which included wife’s separate
real property, was commingled); see also Brush and Brush,
319 Or App 1, 12, 509 P3d 124 (2022) (explaining that “[t]he
length of the marriage alone tells us little, if anything, about
whether the social and financial objectives of ORS 107.105
(1)(f) are being met in a particular property division”). True,
it is more likely that parties’ financial affairs can be readily
untangled if the marriage only lasted a short time, but it is
not a guarantee. Whether commingling occurred requires
a case-specific analysis of the interrelation of the parties’
finances, no matter the duration of the marriage. Thus, the
trial court did not commit legal error when it found that
commingling had occurred even though the parties were
only married for a short amount of time.
Apart from his assertions of legal errors, we under-
stand husband to argue that the trial court’s property divi-
sion was an abuse of discretion because the record lacked
evidence to show that he intended to transform separate
assets into joint marital assets. Again, we disagree.
Determining whether acts of commingling have
converted a separately acquired asset into a joint marital
asset depends to a large extent on evidence of the parties’
intent. Van Winkel, 289 Or App at 811. That analysis is not
controlled by what the parties say about their intentions. It
also requires a court to examine what the parties did with
their assets during the marriage. Lind and Lind, 207 Or App
56, 68, 139 P3d 1032 (2006). Thus, in evaluating whether a
spouse intended separately acquired assets to remain sepa-
rate or become a joint marital asset, the court may consider
a nonexclusive list of factors such as whether the disputed
property was separately or jointly held, whether the parties
shared control over the property, and how much the parties
relied on the property as a joint asset. Kunze, 337 Or at 141.
Based on the record, the trial court did not abuse
its discretion in determining that husband intended Wagon
Wheel and Yamhill to become joint marital assets. Although
the parties agree that husband had moved out of Wagon
Cite as 321 Or App 491 (2022) 499
Wheel by August 2018, the three-month mark of their mar-
riage, wife did not initiate these divorce proceedings until
March 2020. Within that roughly 19-month period, both
properties were jointly titled in the parties’ names, the par-
ties entered into a joint mortgage for Yamhill, the parties
intended to live together at both properties, wife controlled
the decisions regarding the renovation and management of
the properties, and wife managed the bank account used to
pay for expenses related to Yamhill. In addition to evidence
of the joint title and joint control of the properties, the trial
court also expressly considered evidence that wife relied on
husband’s promise of financial support, including the hous-
ing and income provided by Wagon Wheel and Yamhill,
when selling her own premarital property and moving into
Wagon Wheel.
In support of his position, husband relies heavily on
his testimony that his intent was only for wife to share in
the properties “in marriage,” not in the event of a divorce. In
so doing, husband demonstrates a misunderstanding of how
a court determines whether an asset has been integrated
into the common financial affairs of the marital partnership
such that it is considered a joint marital asset. The court
does not look at how the parties would like the property to
be treated once the relationship ends, but instead on how
the parties treated the property at the time of acquisition
and during the marriage. Lind, 207 Or App at 68. Here,
the trial court focused on the correct question. Husband’s
testimony that he wanted to share the properties “in mar-
riage,” coupled with testimony that he never intended to get
divorced, his decision to forgo a prenuptial agreement, and
his execution of a will leaving most of his estate to wife,
even after the parties physically separated, speak directly
to husband’s intent to treat Wagon Wheel and Yamhill as
joint marital assets.
In sum, the trial court did not commit legal error
by either focusing solely on commingling or in conducting
the commingling analysis. The court properly considered
commingling as one of the factors in making a just and
proper determination because the interrelation of the par-
ties’ finances determines whether a marriage is considered
“short-term,” not simply the number of days shared under a
500 Morrison and Chierichetti
single roof. In addition, the record contains evidence to sup-
port the trial court’s determinations that husband intended
Wagon Wheel and Yamhill to be joint marital assets. It was
thus within the range of legally permissible outcomes for
the trial court to conclude that the parties commingled the
properties and to award wife one-half of the equity in those
properties. We therefore affirm the decision of the trial
court.
Affirmed.