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Rhodes v. Rhodes (2/4/94), 867 P 2d 802
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NOTICE: This opinion is subject to formal correction
before publication in the Pacific Reporter. Readers
are requested to bring errors to the attention of the
Clerk of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501.
THE SUPREME COURT OF THE STATE OF ALASKA
CHRISTOPHER RHODES, ) Supreme Court No. S-5261
)
Appellant, ) Superior Court No.
) 3AN-90-8339 CI
v. )
) O P I N I O N
CYNTHIA RHODES, )
) [No. 4046 - February 04, 1994]
Appellee. )
______________________________)
Appeal from the Superior Court of the
State of Alaska, Third Judicial District,
Anchorage,
Elaine Andrews, Judge.
Appearances: Christopher Rhodes, pro
se, Anchorage. Allison E. Mendel, Mendel &
Huntington, Anchorage, for Appellee.
Before: Moore, Chief Justice,
Rabinowitz, Matthews, and Compton, Justices.
RABINOWITZ, Justice.
I. INTRODUCTION
In this divorce proceeding, Chris Rhodes appeals the
superior court's determination that certain assets he acquired
before marriage--halibut gear and a fishing vessel--were marital
property subject to equitable division. We affirm in part and
reverse in part.
II. FACTS AND PROCEEDINGS
Chris and Cynthia Rhodes married in 1986, separated in
1990, and obtained a decree of divorce in 1992. Cynthia came to
the marriage with little work experience and a ninth grade
education. Chris came to the marriage with significant property,
work experience in commercial fishing and the oil service
industry, and some college education. While married to Chris,
Cynthia worked as a homemaker.
Before and during the marriage, Chris operated three
fishing vessels: the F/V Chesapeake, the F/V Knightrider, and a
skiff. Chris purchased the Chesapeake in 1979, and had paid all
of his debt on the vessel, except for the final installment,
before his marriage to Cynthia. Similarly, Chris purchased and
paid for the skiff before his marriage. Chris acquired the
Knightrider in 1983 for a purchase price of approximately
$147,000. He made a $30,000 downpayment and agreed to make loan
payments of approximately $20,000 per year. In 1988 Chris and
Cynthia obtained a $185,000 consolidation loan, part of which
they used to pay the remaining debt of approximately $65,000 on
the Knightrider. Cynthia was a co-signer for the loan, and she
and Chris assumed joint and several liability on the debt.
In August 1991 the superior court conducted a hearing
for the limited purpose of determining which assets were marital
property and which were premarital. The court entered proposed
findings on this issue in September. The court determined that
the Chesapeake, the skiff, property in Homer, Chris' minority
interest in his family's business, and a three-wheeler were
Chris' premarital, separate property. The court determined that
the family residence in Cooper Landing, the Knightrider, a van,
and a trailer were marital property. Though it recognized that
the Knightrider was initially separate property, the court
determined that the vessel acquired the status of marital
property on the grounds that Chris and Cynthia used marital
earnings to pay down the consolidated loan by which the couple
had refinanced the vessel. Additionally, the superior court
characterized the consolidated loan as a marital debt, which
"provided refinancing for this significant asset."
The full divorce trial took place in mid-November 1991.
The parties disputed the status of a set of halibut gear Chris
had bought in March 1986, before the marriage. Cynthia argued
that this gear was marital property because it was purchased
shortly before the date of marriage, after the parties had become
an economic unit, were living together, and were expecting their
first child.
In November 1991, the superior court issued its
decision in the divorce proceedings. The superior court made an
equal division of the marital property, in part because Cynthia
had substantially lower earning capacity than Chris. The
decision distinguished between marital and separate property in a
fashion largely consistent with the proposed findings of
September.1 Without comment, the superior court included among
the marital assets the halibut gear that Chris had bought in
March 1986.
Subsequently, the superior court issued nunc pro tunc
its findings of fact, conclusions of law, and decree of divorce.
The court "consider[ed] its [previously entered] extensive
written finding[s] adequate,"and declined to issue separate
findings on the status of the halibut gear. Chris appeals.
III. DISCUSSION
A. Standard of Review
We have established a three-step process for the
equitable division of property in a divorce proceeding: (1)
determination of the property available for distribution; (2)
valuation of the property; and (3) equitable division of the
property. See Wanberg v. Wanberg, 664 P.2d 568, 570 (Alaska
1983). Chris challenges the superior court's findings at the
first step of the analysis: the determination whether particular
assets are marital or separate property.2 We review the trial
court's factual determinations as to the property available for
distribution for abuse of discretion. Doyle v. Doyle, 815 P.2d
366, 368 (Alaska 1991).
B. The Halibut Gear
Chris argues that the halibut gear that he purchased in
March 1986 is his separate, premarital asset.3 Though the
superior court did not state its reasons for characterizing this
halibut gear as marital property, Chris suggests that the court
may have based its finding on the fact that he and Cynthia were
living together at the time of the gear's purchase.
Marital property consists of those assets, "whether
joint or separate, acquired only during marriage." AS
25.24.160(a)(4) (emphasis added);4 see also Carlson v. Carlson,
722 P.2d 222, 224 (Alaska 1986). An asset that is originally
premarital may be treated as marital for purposes of distribution
if the parties, by their actions during the marriage,
demonstrated an intent to treat the asset as a joint holding.
See, e.g., Chotiner v. Chotiner, 829 P.2d 829, 832-33 (Alaska
1992); Carlson, 722 P.2d at 224-25; Wanberg, 664 P.2d at 571.
One indicia of such intent is to place the property in joint
ownership. Chotiner, 829 P.2d at 833. Another common indicia is
evidence of substantial efforts at joint management, maintenance,
or improvement of the property in question.5 See, e.g., id.;
Carlson, 722 P.2d at 224-25; Wanberg, 664 P.2d at 571.
We note that Cynthia's sole argument on appeal for
deeming the halibut gear marital property is that Chris purchased
the gear "just prior to the marriage, while the parties were
living together, and while Cynthia was already pregnant with
their first child." Although "property acquired by . . . a
couple may be marital property even if the acquisition predates
the marriage,"commingling of assets alone does not establish the
parties' intent to hold property jointly. Murray v. Murray, 788
P.2d 41, 42 (Alaska 1990); see also Carlson, 722 P.2d at 224.
Because the superior court did not give its reasons for
characterizing the gear as marital property, we cannot determine
whether the court based its determination on the fact of
commingling alone. Though the record does not indicate that
Chris and Cynthia took joint title to the halibut gear, the
superior court may have found that one or more acts demonstrated
that the couple intended to treat the gear as a joint asset.6 We
cannot determine the factual basis for the superior court's
property division from its findings, and so we remand the case
for adequate findings on whether the halibut gear is marital or
separate property. See e.g., Murray v. Murray, 856 P.2d 463, 466
(Alaska 1993); Merrill v. Merrill, 368 P.2d 546 (Alaska 1962).
C. The F/V Knightrider
Chris argues that the Knightrider in its entirety
should be treated as separate property, arguing inter alia that
when the parties refinanced the vessel with the consolidated
loan, Cynthia's role was insubstantial.7 We disagree. Cynthia
co-signed the loan and assumed joint and several liability for
its repayment. The couple used marital earnings to pay off the
consolidated loan. Thus, the parties demonstrated an intent to
treat the vessel as marital property by making substantial
efforts at joint management of the asset. See, e.g., Carlson,
722 P.2d at 224-25; Wanberg, 664 P.2d at 571-73.
IV. CONCLUSION
We AFFIRM the superior court's determination that the
F/V Knightrider was marital property. We remand the question of
whether the halibut gear is a marital asset to the superior court
for additional factual findings and any further proceedings
deemed necessary by virtue of this remand.8
_______________________________
1 The only change that the court made from its September
determination was to recharacterize the three-wheeler as marital
property.
2 Chris also characterizes the superior court's findings
as to the Knightrider as an invasion of his separate property.
This characterization is inaccurate. The determination whether
to invade separate property occurs only at the third step of the
trial court's analysis. Chotiner v. Chotiner, 829 P.2d 829, 831
(Alaska 1992). If the trial court considers property to be
marital rather than separate, as is the case with the
Knightrider, then a determination whether to invade it does not
occur.
A3aska Statute 25.24.160(a)(4) states in part:In a jud
gment in an action for divorce . . . the court may provide[:]
. . . . (4) for the division between t
4 Alaska Statute 25.24.160(a)(4) states in part:
In a judgment in an action for divorce
. . . the court may provide[:]
. . . .
(4) for the division between the
parties of their property . . . whether joint
or separate, acquired only during marriage,
in a just manner and without regard to which
of the parties is in fault; however, the
court, in making the division, may invade the
property . . . of either spouse acquired
before marriage when the balancing of the
equities between the parties requires it
. . . .
5 This indicia has been applied only to real property; in
appropriate cases, however, it might also be relevant to personal
property.
6 The record indicates that Cynthia performed multiple
tasks on behalf of the fishing enterprises, including preparation
of halibut lines for the fishing season. However, the superior
court did not indicate whether such tasks amounted to substantial
efforts devoted to the maintenance, management, or control of the
property at issue under our case law.
7 The parties agreed that the F/V Knightrider, with the
skiff, was worth $93,000. Because it determined that the skiff
was Chris' separate property, the superior court deducted its
$3,000 value, arriving at a value for the Knightrider of $90,000.
Additionally, because it ordered the sale of the Knightrider, the
superior court deducted a ten percent commission for the sale,
reaching a net value to the marital estate of $81,000.
8 Though Chris also appealed the superior court's award
of attorney's fees to Cynthia, the parties settled this issue
during the course of the appeal. Therefore, this question is no
longer before us.
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