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Hansen v. Hansen (09/02/2005) sp-5939
Hansen v. Hansen (09/02/2005) sp-5939
Notice: This opinion is subject to 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, phone (907) 264-0608, fax (907) 264-0878,
e-mail corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
| KARL HANSEN,
| ) |
|
| ) Supreme Court No. S-
11053 |
|
Appellant, | ) |
|
| ) Superior Court No.
3AN-00-8957 CI |
|
v. | ) |
|
| ) O P I N I O
N |
|
MADA HANSEN, | ) |
|
| ) [No. 5939 -
September 2, 2005] |
|
Appellee. | ) |
|
| ) |
|
|
|
|
Appeal from the Superior Court of the State
of Alaska, Third Judicial District,
Anchorage, Stephanie E. Joannides, Judge.
Appearances: G.R. Eschbacher, Anchorage, for
Appellant. Lawrence A. Pederson, Paul J.
Nangle & Associates, Anchorage, for Appellee.
Before: Bryner, Chief Justice, Matthews,
Eastaugh, Fabe, and Carpeneti, Justices.
EASTAUGH, Justice.
I. INTRODUCTION
I. Karl and Mada Hansen divorced in 2002, and the superior
court divided their assets following trial. Karl raises various
property division issues on appeal. We affirm as to most of the
rulings challenged by Karl. But we reverse the ruling that one
of Karls IRAs was a wholly marital asset, because we conclude
that Karl funded at least part of this account with premarital
assets. We also reverse the ruling that Karls T. Rowe Price
account was a marital asset, because we conclude that Karl funded
this account with premarital assets. And we vacate the ruling
that all of Madas post-retirement health insurance benefits are
her separate property, because we conclude that she used marital
assets to repurchase benefits she earned before the marriage and
that they have value to Mada. We remand for further proceedings
as to the IRA, the T. Rowe Price account, and the health
insurance benefits. We affirm the property division order in all
other respects.
II. FACTS AND PROCEEDINGS
Mada and Karl Hansen began living together in 1986 and
married in June 1989. Mada filed a complaint for divorce on July
24, 2000. Throughout the divorce proceedings they lived in
separate areas of the marital home until Karl moved out on
October 10, 2002. They both paid bills associated with the home.
The superior court found that even though [Mada and Karl] were
heading toward divorce, they continued, for all practical
purposes, to live as a marital unit. The superior court issued
the divorce decree on October 22, 2002.
No children were born or adopted of the marriage, and
Karl and Mada are both in relatively good health and capable of
working. Karl is a self-employed civil engineer with Cold
Regions Technology, Inc. (Cold Regions) and is its sole
shareholder. He has earned, and continues to earn, more than
Mada, reporting income of $93,000 on his 2000 tax return. He
also has a longer work-life expectancy because he is seven years
younger than she is. Mada is an engineer technician at the
Municipality of Anchorage and earns $34,344 per year.
The superior courts October 2002 findings of fact and
conclusions of law entered following trial found that
Karl managed all the finances. Sometimes he
transferred money from accounts in their
individual names to accounts in only Karls
name. It is difficult to trace all the
money. It is clear from the way the money
was transferred and used that it was
commingled and that some of it was used to
improve the marital home. . . . I find that
Karls financial transfers during the marriage
do not make sense and raise some questions
about the use of the funds and the source of
some of the money in accounts he does not
satisfactorily explain.
The court also stated that [i]t is difficult to determine if
there has been an unreasonable depletion of the marital assets.
It appears that Karl may have made some poor decisions about the
amount of money he borrowed and spent on remodeling the house.
The court found that the parties funds were commingled and
transmuted into marital property. For these reasons and because
of their disparate earning potentials, the court decided that a
60/40 distribution in Madas favor is just. The court classified
and divided the parties property.
Karl unsuccessfully moved for reconsideration. Karl
appeals with respect to rulings regarding the following assets:
(1) Cold Regions; (2) the marital residence; (3) post-separation
payments; (4) the Alaska USA account; (5) two IRA accounts; (6)
the T. Rowe Price account; and (7) Madas health insurance
benefits.
III. DISCUSSION
A. Standard of Review
In property division cases we determine whether the
trial court abused the discretion vested in it under AS
25.24.160(a)(4).1 Dividing the property is a three-step process.2
First, the trial court must determine what property is available
for distribution, characterizing the property as either separate
or marital, a determination we review under the abuse of
discretion standard. An abuse of discretion occurs if the court
considers improper factors, fails to consider relevant statutory
factors, or assigns disproportionate weight to some factors while
ignoring others.3 Marital property includes all property
acquired during the marriage excepting only inherited property
and property acquired with separate property which is kept as
separate property.4 We apply our independent judgment to any
questions of law.5
Second, the trial court must place a value on the
property, a ruling which is a factual determination reviewed for
clear error.6 To reverse for clear error, we must be left with a
definite and firm conviction on the entire record that a mistake
has been made.7
Third, the trial court must equitably allocate the
property, a ruling which we review under the abuse of discretion
standard; we will not disturb the allocation unless it is clearly
unjust.8
The trial court has broad discretion in considering the
following factors, among others, in allocating marital property:
(1) the parties earning abilities; (2) the parties stations in
life; (3) the parties circumstances and necessities; (4) the
parties physical conditions and health; and (5) the parties
financial circumstances, including the time and manner of
acquisition of the property at issue, its value at the time, and
any income producing capacity.9
B. The Court Did Not Clearly Err in Valuing Cold Regions.
Madas expert, Francis Gallela, and Karls expert, Ted
Sherwin, testified regarding the value of Cold Regions. The
superior court found Gallelas testimony more persuasive and
valued Cold Regions at $96,236.
Karl argues that the superior court erred, because it
did not give a sufficient explanation for its finding. He argues
that because Cold Regions is primarily a one-person corporation,
the value of its goodwill plays a significant role in its value.
He contends that Gallela was unable to separate Karls goodwill
from Cold Regionss goodwill and was unable to determine Cold
Regionss marketability. Therefore, he argues, Gallelas estimate
of value is of little practical use.
Karl argues that Sherwin, a certified public
accountant, considered Cold Regionss marketability and goodwill.
Sherwin found an absence of marketable goodwill; Karl argues that
the goodwill was his own and is therefore not marketable. He
contends that the court erroneously made no finding whether
goodwill existed and whether it could be sold to a prospective
buyer. Karl argues that Sherwin conducted a more thorough
investigation than Gallela and concluded that the corporation was
going down hill fast and was worth $36,000. Karl argues that
Sherwins determination of Karls salary was more accurate than
Gallelas and that Gallelas capitalization-of-earnings method was
flawed.
Mada points out that Gallela used a capitalization-of-
earnings approach to value the business, while Sherwin used an
asset-based approach. Mada points out that the business had
several employees and a contract worth $272,000, as well as
fairly good prospects for more work; thus, Sherwins conclusion
that Karl was the company was erroneous. Mada argues that the
business had goodwill and that it was marketable.
Valuing goodwill is a two-step process.10 First, the
trial court must decide whether goodwill exists.11 If goodwill
does exist, the court must then determine whether it could be
sold to a prospective buyer.12 If the goodwill is not marketable,
then no value for goodwill should be considered in dividing the
marital assets.13 Second, if there is marketable goodwill, the
court should determine its value using one or more of the
principled methods of valuation.14 The capitalization-of-earnings
approach Gallela used is an acceptable method.15 The existence,
marketability, and calculation of goodwill present questions of
fact, which we will set aside only for clear error.16
The superior court picked a value that Gallela
determined using an acceptable method, and Gallelas testimony
does not clearly state that any of the value he found is
goodwill. The superior court could have been clearer in
explaining how it arrived at the value it adopted. In Lang v.
Lang we remanded a property division case to the trial court, but
there the trial court failed to make any findings regarding the
value of the property distributed.17 Despite the lack of specific
findings in this case, the record, particularly in light of the
superior courts conclusion concerning the credibility of the
expert witnesses, when viewed as a whole does not leave us with a
definite and firm conviction that the superior court made a
mistake. We cannot say that the courts decision regarding the
value of Cold Regions was clearly erroneous.18
C. The Court Did Not Clearly Err in Valuing the Marital
Residence.
The superior court found that $365,000 was the as-is
value of the house, including all the uninstalled items and
building materials. Karl argues that the court offered no facts
from which it arrived at this figure. He contends that an expert
valued the house at $365,000 and the uninstalled building
materials inside the house at $22,000. He argues that the court
did not address the value of the uninstalled items.
But, as Mada points out, her appraiser valued the house
at $340,000, including the unincorporated materials. She also
correctly asserts that Karls appraiser stated that $25,000 was a
valid price range divergence. The court, therefore, could have
arrived at its valuation of $365,000 in several ways, namely, by
using Madas appraisers opinion and adding the price range, or by
taking Karls appraisers finished value ($515,000) and subtracting
the cost of completion ($150,000). She argues that the courts
finding is, therefore, not erroneous, and falls within the range
of evidence presented at trial.19 We agree. The superior court
valued the house within the range of figures given by the
experts.20 It did not clearly err in choosing this value.
D. The Court Did Not Abuse Its Discretion in Refusing To
Credit Karl for Post-Separation Payments.
The superior court found that both parties made
substantial post-separation payments to preserve marital assets,
with Karl paying approximately twice as much as Mada.
Recognizing that Karl earns significantly more than Mada and that
the parties continued to live in the marital home, the court
decided not to give either party credit for these payments. The
court also took these payments into account in determining the
appropriate overall division of the marital property.
Karl argues that the court erred in refusing either to
grant credit to him or to reduce his marital debt accordingly for
the $59,889.07 in post-separation payments he made to preserve
martial assets. Karl points out that the parties lived in
separate areas of the home until he moved out on October 10,
2002. He argues that the court incorrectly decided that (1) the
parties remained a marital enterprise until entry of the October
22, 2002 divorce decree and (2) everything that Mada and Karl had
earned until then was marital property. He contends that in
Ramsey v. Ramsey we stated that a trial court may not conclude
that parties continue to function economically as a marital unit
after the date of separation just because one of the parties is
economically dependent on the other.21 Karl argues that his
presence in the marital residence, without more, does not justify
declaring all payments marital property and denying credit to the
payer. He contends that the filing of a divorce complaint and an
answer, as well as physical separation to distinct areas of the
home, should be enough to declare an end to the marital unit.
Karl also points out that he was absent from the parties home
more than he was there.
No single rule defines when a couple ceases to be one
economic unit. Each case must be judged on its facts to
determine when the marriage has terminated as a joint enterprise.22
Generally, property accumulated with income earned after a final
separation that is intended to, and does in fact, lead to a
divorce is excluded from the category of marital property, as
long as it is obtained without the invasion of any pre-separation
marital asset.23 Likewise, the date for marking the termination
point for including property in the marital assets should
correspond to the end of the marital team effort.24 For example,
this could be when the parties separate, when one files for
divorce, or when the court enters the divorce decree.25
Trial courts must consider payments made to maintain
marital property from post-separation income when dividing
marital property.26 But they need not necessarily give credit in
the final property division to the spouse making the payment.27
The parties here lived in separate parts of the same
house and shared house expenses. Thus, we agree with Mada that
the superior court could permissibly find that the parties
continued to live as a marital unit until the date of the divorce
decree. Case law does not require the trial court to credit
either party for their post-separation payments,28 and the court
gave clear reasons for its decision. We therefore conclude that
the court did not abuse its discretion in declining to credit
Karl for these payments.
E. The T. Rowe Price Account and One of the IRA Accounts
Are Not Marital Property, but the Other Accounts Are.
Karl argues that the superior court erred by failing to
find that three financial accounts were his separate property.
Mada argues that the court correctly determined that these
accounts were marital.
1. Alaska USA account
Karl had an Alaska USA account, and the superior court
found that two deposits had been made into it, $8,000 on May 19,
2001 and $6,000 on August 4, 2001. It concluded that because the
parties agreed to value marital assets as of the date of the
trial and because they continued to live in the marital home and
made payments to preserve marital assets, the money then in the
Alaska USA account was a marital asset. It also found that the
time of the divorce decree, October 22, 2002, is the time when
the income earned after the final separation became severable
from marital property. It reached this decision because the
financial transactions Karl conducted and the source of funds in
several accounts made it difficult to identify the source of many
of the funds.
Karl argues that it was an abuse of discretion for the
court to conclude that monies earned and deposited in Karls
account after Mada filed for divorce are marital property,
because no evidence shows that the parties intended to function
as a marital enterprise after that time. He contends that it is
not enough that he and Mada continued to occupy the marital
residence; without more this is not evidence of a marital
enterprise.
But, as explained above in Part III.D, the court did
not err in finding that the parties lived as a marital unit until
entry of the divorce decree. As Mada argues, the court
determined that the two deposits were marital property, because
it found that the parties continued to function as a marital
unit.29
The court therefore did not abuse its discretion in
characterizing the deposits made before entry of the divorce
decree as marital assets.30
2. IRAs
Karl acquired several IRAs during the marriage. As to
two of these accounts, the superior court found that as of
September 30, 2001 IRA A had a value of $6,981.04 and IRA B had a
value of $41,830.91.31 It found that these IRAs were rolled over
on August 13, 1991 and May 23, 2000, respectively, and held them
to be marital assets. It found that the asset balance was rolled
over during the marriage and found that the constant re-
characterization (by rolling over and/or redepositing into
different accounts) of the separate funds and income of both
parties supported characterizing these assets as marital.
Karl contends that he and Mada had separate IRA
accounts, although Karls were rolled over after they married. He
claims that during the marriage the parties contributed $3,500 to
Karls IRA and $3,500 to Madas IRA. Karl asserts that the court
erred when it classified these two IRAs as marital, because all
funds within these IRAs other than the $3,500 deposits were
either premarital or accruals attributable to premarital funds.
He argues that the court could not divide this property without
finding that the assets were co-mingled or transmuted or that a
balancing of the equities requires such a result,32 yet it made no
such findings.
Mada points out that Karl testified that IRA A received
some contributions during the marriage. Karl stated that these
were rollovers from his other premarital IRAs, but Mada showed
that between $67,000 and $121,000 of Karls marital earnings had
not been deposited into marital funds or trackable separate
funds. Mada argues that the court could infer that the missing
funds, not premarital funds, were the source of the deposits made
during the marriage.
Property that was once separate may be transmuted into
marital property if its owner intended to do so. Intent may be
demonstrated through words and actions.33 [P]lacing separate
property in joint ownership is rebuttable evidence that the owner
intended the property to be marital.34 We review a finding of
transmutation for clear error.35
As the superior court explained, it concluded that
these IRAs became marital property as a result of Karls rolling
over and redepositing funds. Although it did not specifically
mention transmutation in reference to these accounts, the court
did find that the parties funds in general were commingled and
transmuted into marital property. The court did not discuss
specifically how these rollovers and redeposits demonstrated an
intent to transmute separate property into a marital asset.
There is no evidence any funds deposited in IRA A were
marital, other than the $3,500 Karl concedes he deposited during
the marriage. There was no evidence of transmutation, and we
agree with Karl that it was an abuse of discretion to treat the
entire account as marital. We therefore reverse the
characterization that this account was entirely marital and
remand for determination of the value of the $3,500 and the
interest it accrued; this portion of the account is marital
property. The rest of IRA A is nonmarital property.
We need not remand with regard to Madas Alaska USA IRA,
with a value of $2,287.45. Because Mada contributed $3,500 to
this account, the entire IRA is marital property, as the superior
court correctly found.
Karl argues that IRA B, like his other IRA, is separate
[personal] property. There was no evidence, either by testimony
or exhibit, that IRA B was premarital property. We therefore
agree with Mada that the superior court did not abuse its
discretion in treating this account as marital.
3. T. Rowe Price account
Karl had a T. Rowe Price account with a value of
$30,179 as of September 30, 2001. The superior court found that
although this account may have been premarital, it lost that
characterization when Karl applied the cash in the account toward
the marital residence.
Karl argues that because he funded this account with
premarital earnings, the court erroneously characterized it as
marital. He also contends that the court erroneously relied on
an account balance statement dated September 2001, when the
parties were cohabiting, but had filed for divorce. He argues
that if the court intended to invade Karls property to balance
the equities, it did not state this intention.36
Mada points out that this account contained $13,564 in
1990 and $38,268 at the beginning of 2001. She argues that there
was no explanation for the increase in value and that it was
Karls burden to explain this increase.37 Mada argues that she had
shown that a large amount of money Karl received during the
marriage had not been deposited into the parties account;
therefore, the court could infer that Karl contributed marital
funds to this account. This, she claims, would justify finding
that the account was marital due to active appreciation. She
also argues that Karl used half of the funds in this account for
a marital purpose, to renovate the house, transmuting the account
into a marital asset.
Separate property may become marital through either
transmutation, as described above, or active appreciation, which
occurs
when marital funds or marital efforts cause a
spouses separate property to increase in
value during the marriage. In contrast to
transmutation, which converts an asset
completely from separate to marital, active
appreciation recognizes that a separate asset
can become partly marital by growing in value
during the course of a marriage. Under the
latter theory, the assets value at the
inception of the marriage retains its
separate character, but any subsequent
increase in value is treated as marital
property to the extent that it results from
active marital conduct: Appreciation in
separate property is marital if it was caused
by marital funds or marital efforts;
otherwise it remains separate.[38]
To decide that active appreciation took place
the court must make three subsidiary
findings. First, it must find that the
separate property in question appreciated
during the marriage. Second, it must find
that the parties made marital contributions
to the property. Finally, the court must
find a causal connection between the marital
contributions and at least part of the
appreciation.[39]
The burden of proving marital contributions and an increase in
value is on the party who seeks to classify the appreciation as
active.40 The burden of proving that the marital contributions
did not cause the increase in value rests with the party who owns
the asset.41
The superior court did not clearly state whether
transmutation or active appreciation made this asset marital.
Using part of a premarital account for a marital purpose does not
change the balance of the account into marital property so long
as no new contributions of marital funds to the account are made.
Karl testified that there were no contributions to the account
during the marriage. Furthermore, this type of account is not
normally subject to active appreciation.42 We therefore conclude
that the increase in value resulted from passive appreciation,
and that the account remained premarital property. Because it
was an abuse of discretion to classify this account as marital,
we reverse the ruling as to this account and remand.
F. Madas Post-Retirement Health Insurance Benefit Is
Partly Marital Property.
Mada had a PERS defined benefit retirement account,
which she both earned and cashed out before the marriage. Mada
bought back her PERS account with marital funds and agreed to its
characterization as marital property valued at $48,358. The
superior court found that she also acquired, as part of the PERS
benefit package, lifetime health insurance benefits that Karl
cannot share. It found that this benefit was the result of Madas
premarital efforts, but that there was insufficient evidence to
determine the amount of marital assets used to repurchase this
asset. The court also found that even if the health benefits had
been acquired with marital funds, there was no evidence that Karl
could have used the benefits had the parties remained married.
Karl, citing AS 25.24.160(a)(4) and Kinnard v. Kinnard,43
argues that because the health insurance benefits were reacquired
using marital funds, they should have been treated as a marital
asset. He asserts that their value is $85,762 and that it was
error not to credit him with at least half the benefits value.
Mada disagreed with Karls experts valuation of the
health benefits, and asserts that they are not alienable. She
also contends that no evidence was presented as to the amount of
funds required to buy back the retirement and health benefits, or
what the proportionate cost of each would have been. Mada argues
that the coverage has no cash value and that the trial court
correctly ruled that it was not subject to allocation.
Health insurance benefits earned during the marriage
are a marital asset of the insured spouse.44 That the benefits
cannot be transferred is irrelevant, because market
transferability is not a prerequisite to determining value for
property division purposes.45 In Martin v. Martin we dealt with a
similar issue involving frequent flyer miles.46 The miles were
non-transferrable, but an asset need not be marketable if the
court can objectively determine that it has value to its owner.47
We therefore held that the superior court correctly characterized
the frequent flyer miles as a marital asset.48
By using marital funds during the marriage, Mada
reacquired the post-retirement health insurance benefits she
earned before the marriage; the benefit is, therefore, at least
in part a marital asset. As Karl argues, the benefit has value
to Mada, and the court should have determined this value. We
therefore vacate the ruling as to this asset and remand.
On remand Madas retirement health insurance benefit
should be divided into marital and nonmarital portions.49 Courts
in other jurisdictions have approved the division of particular
property into marital and nonmarital portions.50
Only the marital portion of the retirement health
insurance benefit is divisible between Mada and Karl; benefits
Mada has earned since the marriage ended are not marital. This
is because post-divorce, pre-retirement health insurance benefits
are compensation for contemporaneously performed work and are
therefore separate property, whereas post-retirement health
insurance benefits are compensation for work previously
performed.51 In this case, when Mada eventually retires, some of
that work will have been performed during the marriage and some
of it will have been performed after the marriage. For purposes
of valuing Madas retirement health insurance benefit, work she
performed before the marriage must be treated as having been
performed during the marriage because Mada used marital funds to
buy back this part of the benefit.
The court should determine the percentage of the
benefit that is marital by calculating the coverture fraction.52
This fraction is calculated by dividing the number of years
worked during the period of coverture by the total number of
years worked.53 To the extent Mada used marital funds to buy back
health benefits for work performed before the parties began
living together, that period of work must be treated as part of
the period of coverture.
Our holding should not be read to suggest that the
proceeds from health insurance are marital property.54 When
valuing the retirement health insurance benefit, the superior
court should look to the amount of the premium subsidy provided
by the employer, rather than to either the proceeds or the cost
of procuring comparable insurance.55
There are inherent difficulties in attempting to
calculate the value of this benefit. Because Mada had not yet
retired at the time of trial, the evidence in the record makes it
impossible to know with certainty how many years Mada will
ultimately work. It is therefore impossible to calculate with
certainty the percentages of marital and nonmarital interests for
the post-retirement health insurance benefit. Likewise, because
we cannot know how long Mada will live, the total value of the
employers premium subsidy cannot be calculated with certainty.
Despite these uncertainties, sufficient evidence was
presented in this case to place in issue the value of the
retirement health care benefit; accordingly, the court on remand
must exercise its discretion in fashioning an equitable division
of this benefit.56 It may, in its discretion, receive additional
evidence relevant to the value of the benefit.
IV. CONCLUSION
We REVERSE the property division order as to IRA A and
the T. Rowe Price account, VACATE the order as to the health
insurance benefits, and REMAND for further proceedings as to
those property items. We AFFIRM the property division order in
all other respects.
_______________________________
1 Moffitt v. Moffitt (Moffitt I), 749 P.2d 343, 346
(Alaska 1988).
2 Id.
3 West v. West, 21 P.3d 838, 841 (Alaska 2001).
4 Lewis. v. Lewis, 785 P.2d 550, 558 (Alaska 1990).
5 Id.
6 Moffitt I, 749 P.2d at 346.
7 Martens v. Metzgar, 591 P.2d 541, 544 (Alaska 1979).
8 Moffitt I, 749 P.2d at 346.
9 Miles v. Miles, 816 P.2d 129, 131 (Alaska 1991).
10 Moffitt I, 749 P.2d at 347.
11 Id.
12 Id.; see also Manelick v. Manelick, 59 P.3d 259, 262-63
(Alaska 2002).
13 Moffitt I, 749 P.2d at 348.
14 Id. at 347-48.
15 Pattee v. Pattee, 744 P.2d 658, 661 (Alaska 1987),
overruled on other grounds by Nass v. Seaton, 904 P.2d 412, 416
n.7 (Alaska 1995).
16 See Moffitt v. Moffitt (Moffitt II), 813 P.3d 674, 676
(Alaska 1991); Manelick, 59 P.3d at 263-64. We disapprove of
Richmond v. Richmond, 779 P.2d 1211, 1213 (Alaska 1989), to the
extent it is inconsistent with reviewing for clear error.
17 Lang v. Lang, 741 P.2d 1193, 1196 (Alaska 1987).
18 Rausch v. Devine, 80 P.3d 733, 737 (Alaska 2003) (The
trial courts findings regarding the credibility of witnesses and
weighing of the evidence may be reversed only if clearly
erroneous. In reviewing the trial courts factual findings, we
view the evidence in the light most favorable to the party
prevailing in the trial court.) (internal citations omitted).
19 Harrower v. Harrower, 71 P.3d 854, 862 (Alaska 2003).
20 Berg v. Berg, 983 P.2d 1244, 1249 (Alaska 1999).
21 Ramsey v. Ramsey, 834 P.2d 807, 809 (Alaska 1992).
22 Bays v. Bays, 807 P.2d 482, 486 (Alaska 1991) (quoting
Schanck v. Schanck, 717 P.2d 1, 3 (Alaska 1986)).
23 Schanck, 717 P.2d at 3.
24 Ogard v. Ogard, 808 P.2d 815, 819 (Alaska 1991)
(original emphasis).
25 Schanck, 717 P.2d at 3 & n.7.
26 Ramsey, 834 P.2d at 809.
27 Id.
28 Id.
29 Schanck, 717 P.2d at 3 & n.7.
30 See Lundquist v. Lundquist, 923 P.2d 42, 47 (Alaska
1996).
31 For ease of discussion and to avoid disclosing personal
information, we refer to the two disputed IRAs as IRA A and IRA
B.
32 AS 25.24.160(a)(4); Green v. Green, 29 P.3d 854, 857-58
(Alaska 2001).
33 Green, 29 P.3d at 857.
34 Chotiner v. Chotiner, 829 P.2d 829, 833 (Alaska 1992).
35 Green, 29 P.3d at 859.
36 See Nicholson v. Wolfe, 974 P.2d 417, 424 & n.26
(Alaska 1999) (noting that without finding that parties intended
to treat premarital property as marital property, the trial court
would be justified in dividing the . . . assets only if it
specifically found that a balancing of the equities between the
parties required invasion of the pre-marital holding) (internal
quotation omitted).
37 Harrower v. Harrower, 71 P.3d 854, 859 (Alaska 2003).
38 Id. at 857-58 (internal citations omitted) (quoting
Brett R. Turner, Equitable Distribution of Property 5.22, at 230
(2d ed. 1994) [hereinafter Turner]).
39 Id. at 858 (internal citation omitted).
40 Id. at 859 & n.11.
41 Id. at 859 & n.12.
42 See In re the Marriage of Gottsacker v. Gottsacker, 664
N.W.2d 848, 853 (Minn. 2003) ([A]n increase in the value of
nonmarital property attributable to inflation or to market forces
or conditions, retains its nonmarital character.) (citing Nardini
v. Nardini, 414 N.W.2d 184, 192 (Minn. 1987)).
43 Kinnard v. Kinnard, 43 P.3d 150, 156 (Alaska 2002).
44 Id.
45 Martin v. Martin, 52 P.3d 724, 731 (Alaska 2002).
46 Id.
47 Id.
48 Id.
49 See Walek v. Walek, 749 N.Y.S.2d 383, 386 (N.Y. Sup.
2002) (holding that health insurance coverage component of
husbands retirement benefits was marital asset subject to
equitable distribution).
50 See, e.g., Lampton v. Lampton, 721 S.W.2d 736, 738 (Ky.
App. 1986) (dividing particular stock holding into marital and
nonmarital portions); Doucette v. Washburn, 766 A.2d 578, 581,
587 (Me. 2001) (dividing pension into marital and nonmarital
portions); Hoffman v. Hoffman, 614 A.2d 988, 998 (Md. Spec. App.
1991) (remanding to determine the correct values of the marital
and nonmarital portions of a particular property); Poach v.
Poach, 392 N.W.2d 749, 752-756 (Minn. App. 1986) (valuating
marital and nonmarital portions of asset); Hall v. Hall, 118
S.W.3d 252, 259 (Mo. App. 2003) (stating that trial court should
separate pension into marital and nonmarital portions); Coughlin
v. Coughlin, 823 S.W.2d 73, 75 (Mo. App. 1991) (dividing IRA
into marital and nonmarital portions); Sutliff v. Sutliff, 522
A.2d 1144, 1150 (Pa. Super. 1987) (dividing particular stock
holding into marital and nonmarital portions).
51 Brett R. Turner, Equitable Distribution of Property
6.26 (2d ed. Supp. 2004) [hereinafter Turner Supplement].
52 See Turner, supra note 38 at 6.10.
53 Id.
54 Turner Supplement, supra note 51 at 6.26.
55 See id.
56 We note that Turner discusses principles governing the
distribution of analogous retirement benefits. See Turner, supra
note 38 at 6.11 (Methods for Distributing Retirement Benefits).
Given the difficulty of valuing and dividing retirement health
insurance benefits and because the method of distribution has not
been briefed in this case, we express no preference for any
particular method.
