Washington Appeals Court Affirms Equalizing Judgment in Divorce Case

A trial court in a Washington divorce has broad discretion to make a just and equitable property division.  RCW 26.09.080 sets forth certain factors that the court must consider in making a just and equitable property distribution, but those factors are not exclusive.  The trial court must consider the nature and extent of both the community property and any separate property, the length of the marriage, and each spouse’s economic circumstances when the division takes effect.  The court must fairly consider the circumstances and future needs of both parties. An appeals court generally affirms a property distribution unless there was a manifest abuse of discretion.  A manifest abuse of discretion occurs if there is a patent disparity in the economic circumstances of the parties as a result of the decree.  A former husband recently challenged a property division in which his former wife was awarded a $12,000 judgment.

The parties got married in April 2018 and separated in October 2020.  According to the appeals court’s unpublished opinion, they did not have many assets or debts.  They bought a home during the marriage. The wife transferred her interest in the home to the husband in 2019 via a quitclaim deed, though her reasons for doing so were in dispute.

The husband asked that the court award each party the bank and retirement accounts in their own name and the vehicle and any personal property in their possession. He asked the court to award him the home. He agreed to assume the community debt if he did not have to pay spousal maintenance.

The wife requested $1,000 per month in spousal maintenance for a year.

The wife testified she earned about $38,000 per year before the marriage.  She said she had used her retirement account during the marriage to pay bills and purchase household items.  She said she had paid half the mortgage payments while the parties were married. She testified that she experienced homelessness and was only able to earn $6,800 per year after the separation.

The husband testified the wife took most of the household items and estimated they were worth $6,000 to $7,000. The wife claimed they were only worth about $3,500.

The husband testified the wife signed over her interest in the home to allow them to qualify for a Tribal Credit loan.  He testified that he was a tribal member but she was not.  The wife, however, testified she signed a “packet of paperwork” so they could get a HUD loan, and the quitclaim deed was part of that packet.  She said the husband told her he needed her to sign so they could get the loan.  She said it was not explained to her and that she did not think she was signing her rights away.

The trial court pointed out the parties had not provided “relevant financial information.”  It awarded each party the vehicle in their possession and denied the wife’s request for maintenance.  The court found the home was the husband’s separate property and valued it around $190,000 – $195,000.  The court also found the wife had received personal property worth about $5,000.  The court awarded the husband about $3,000 in debt.  The court also awarded the wife a $12,000 judgment to reimburse her for her interest in the husband’s 401(k) and any community funds that paid for the house.

The husband appealed, arguing the trial court erred in awarding the equalizing judgment.

The husband argued that granting the judgment to balance his retirement contributions during the marriage was an error because there was not any evidence regarding his contributions.  The appeals court pointed out that the husband testified he earned retirement benefits while the parties were married but did not provide the amount.  The trial court did not have much evidence on which to base the property distribution, but found that part of the judgment was needed to reimburse the wife for the retirement benefits earned during the marriage.  The appeals court concluded the trial court’s judgment was not based on untenable grounds.

The husband argued it was also error for the court to award part of the judgment to reimburse the wife for mortgage and property insurance paid by the community.  He argued the wife had received the benefit of living in the home.  The trial court found the home was the husband’s separate property, but the payments were made from his earnings, which were community property.  The trial court found the community funds were used to augment the husband’s separate property and that the wife needed to be reimbursed.  Although the court found the home was the husband’s separate property, it acknowledged the circumstances around execution of the quitclaim deed were “dubious”

A party may be entitled to reimbursement if community assets are used to make separate loan payments. The trial court found the husband augmented separate property with community funds, so its order for reimbursement did not create a patent disparity in the economic circumstances of the parties.

The appeals court rejected the husband’s argument the trial court had disproportionately allocated community property to the wife.  The appeals court noted the husband received the funds in his retirement account, the home valued by the court at $45,000 in separate property, his vehicle, and $3,000 in debt.  The wife was not awarded any significant separate property, but received $5,000 in household property and her vehicle.  The court properly considered the parties’ economic circumstances and awarded the wife $12,000 to address the economic disparity.  The appeals court also pointed out that the husband received the house and could earn $30.72 per hour, but the wife did not have a home and could only earn minimum wage.

This case shows that property division can be contentious even when there are not significant assets.  If you are facing a divorce, a knowledgeable Washington divorce attorney can help you identify and present evidence to support your case.  Call Blair & Kim, PLLC, at (206) 622-6562 to set up a consultation.


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