Court of Appeals holds that a trial court may make decisions as to whether property is marital and/or whether it is actually owned by a person/entity not a party to the divorce. However, the trial court does not have the authority to rule that the parties must transfer by warranty deed a piece of property to a non-party. Non-parties need to intervene in the case if they believe they own the property.

Here’s the link…
Wise v. Wise

This case is about as protracted as it gets. Several hearings; multiple allegations; multiple drugs; multiple drug tests; and more.

Provides a good example of the types of evidence needed in these types of cases.

Here’s the link…
Poole v. Poole

It is common practice for a judge, at the conclusion of a hearing, to designate one of the attorneys to draft the order of the court. Sometimes the attorney drafts it immediately. Sometimes there is a delay due to a number of different reasons.

In this case, the court divided a retirement account held by the husband. It was divided equally between the parties. 4 years later the decree was finally entered. The retirement account increased significantly in value during that time. Husband wanted the division to be as of the date of the hearing, 4 years earlier, as opposed to the date the decree was entered. Wife objected.

The Court of Appeals held that the account is to be divided as of the date the decree is entered, as had been held in prior Arkansas cases. The husband failed to show he had suffered any injustice by the delay in getting the decree drafted.

I’m betting he would disagree.

Here’s the link…
Churchill v. Churchill

Wife signs over interest in real property due to her husband being the dominant party in the relationship and also because she owed a debt, needed money to pay the debt, and husband used that knowledge to his advantage. Is this enough for wife to save her interest in the property at the final divorce hearing? Court of Appeals says yes.

Here it is…
McCracken v. McCracken

Arkansas judges will look to Arkansas Code Annotated 9-12-315 when making property division determinations in a divorce. Here’s A.C.A. 9-12-315 in its entirety:

§ 9-12-315. Division of property

(a) At the time a divorce decree is entered:

(1) (A) All marital property shall be distributed one-half (1/2) to each party unless the court finds such a division to be inequitable. In that event the court shall make some other division that the court deems equitable taking into consideration:

(i) The length of the marriage;

(ii) Age, health, and station in life of the parties;

(iii) Occupation of the parties;

(iv) Amount and sources of income;

(v) Vocational skills;

(vi) Employability;

(vii) Estate, liabilities, and needs of each party and opportunity of each for further acquisition of capital assets and income;

(viii) Contribution of each party in acquisition, preservation, or appreciation of marital property, including services as a homemaker; and

(ix) The federal income tax consequences of the court’s division of property.

(B) When property is divided pursuant to the foregoing considerations the court must state its basis and reasons for not dividing the marital property equally between the parties, and the basis and reasons should be recited in the order entered in the matter.

(2) All other property shall be returned to the party who owned it prior to the marriage unless the court shall make some other division that the court deems equitable taking into consideration those factors enumerated in subdivision (a)(1) of this section, in which event the court must state in writing its basis and reasons for not returning the property to the party who owned it at the time of the marriage.

(3) (A) Every such final order or judgment shall designate the specific real and personal property to which each party is entitled.

(B) When it appears from the evidence in the case to the satisfaction of the court that the real estate is not susceptible of the division as provided for in this section without great prejudice to the parties interested, the court shall order a sale of the real estate. The sale shall be made by a commissioner to be appointed by the court for that purpose at public auction to the highest bidder upon the terms and conditions and at the time and place fixed by the court. The proceeds of every such sale, after deducting the cost and expenses of the sale, including the fee allowed the commissioner by the court for his or her services, shall be paid into the court and by the court divided among the parties in proportion to their respective rights in the premises.

(C) The proceedings for enforcing these orders may be by petition of either party specifying the property the other has failed to restore or deliver, upon which the court may proceed to hear and determine the same in a summary manner after ten (10) days’ notice to the opposite party. Such order, judgment, or decree shall be a bar to all claims of dower or curtesy in and to any of the lands or personalty then owned or thereafter acquired by either party.

(4) When stocks, bonds, or other securities issued by a corporation, association, or government entity make up part of the marital property, the court shall designate in its final order or judgment the specific property in securities to which each party is entitled, or after determining the fair market value of the securities, may order and adjudge that the securities be distributed to one (1) party on condition that one-half ( 1/2) the fair market value of the securities in money or other property be set aside and distributed to the other party in lieu of division and distribution of the securities.

(b) For the purpose of this section, “marital property” means all property acquired by either spouse subsequent to the marriage except:

(1) Property acquired prior to marriage or by gift or by reason of the death of another, including, but not limited to, life insurance proceeds, payments made under a deferred compensation plan, or an individual retirement account, and property acquired by right of survivorship, by a trust distribution, by bequest or inheritance, or by a payable on death or a transfer on death arrangement;

(2) Property acquired in exchange for property acquired prior to the marriage or in exchange for property acquired by gift, bequest, devise, or descent;

(3) Property acquired by a spouse after a decree of divorce from bed and board;

(4) Property excluded by valid agreement of the parties;

(5) The increase in value of property acquired prior to marriage or by gift or by reason of the death of another, including, but not limited to, life insurance proceeds, payments made under a deferred compensation plan, or an individual retirement account, and property acquired by right of survivorship, by a trust distribution, by bequest or inheritance, or by a payable on death or a transfer on death arrangement, or in exchange therefor;

(6) Benefits received or to be received from a workers’ compensation claim, personal injury claim, or social security claim when those benefits are for any degree of permanent disability or future medical expenses; and

(7) Income from property owned prior to the marriage or from property acquired by gift or by reason of the death of another, including, but not limited to, life insurance proceeds, payments made under a deferred compensation plan, or an individual retirement account, and property acquired by right of survivorship, by a trust distribution, by bequest or inheritance, or by a payable on death or a transfer on death arrangement, or in exchange therefor.

(c) The court is not required to address the division of property at the time a divorce decree is entered if either party is involved in a bankruptcy proceeding.

The cases interpreting section 315 are far too numerous to be listed here. But, here are a few major points to remember:

• Generally, marital property is split 50-50. However, keep in mind that the court has the power to make an unequal division of marital property if the circumstances call for it. This would be unusual, but not unheard of. (See Lytle v. Lytle, 266 Ark. 124 (1979); Cavin v. Cavin, 308 Ark. 109 (1992))
• Marital fault is not a factor in division of property.
• Although the presumption is that nonmarital property owned prior to the marriage shall be returned to the party who owned it originally, occasionally nonmarital property may be divided. (See Williford v. Williford, 280 Ark. 71 (1983)). But see Hale v. Hale, 307 Ark. 546 (1992) and Farris v. Farris, 287 Ark. 479 (1985), both holding that nonmarital property acquired during the marriage cannot be divided.
• Marital property may include property acquired after separation, but before divorce is final. This time period is usually after the divorce complaint is filed and before the divorce decree is entered. (See Askins v. Askins, 288 Ark. 333 (1986))

As always, make sure you keep your attorney advised of any and all property interests and when and how they are/were acquired.

We’ve all done it.  You settle the divorce on the day of the hearing.  One of the attorneys is to draft the decree and send to the other for approval.  “Do we want to read it into the record?” one of the attorneys or the judge may ask.  Sometimes yes, sometimes no.

In this case, the answer (assuming the question was asked) was “no.”  Later, husband’s attorney, who was not supposed to have drafted the decree, drafted it anyway.  It was sent to the judge.  A notation was entered on the signature line for wife’s attorney that read “No objection received” and had unintelligible initials next to it.  The judge signed the decree and it was entered.

Evidently, wife finds out what has happened and files to have the decree vacated and/or amended.  The judge does not rule on the motion and therefore it is deemed denied.  She appeals.  The appellate court affirmed the trial court’s decision or lack thereof.  It seems that her fatal mistake was that evidently no facts were provided to the trial court (or the appellate court) showing how the decree failed to reflect what the parties had agreed to.  She merely requested that it be amended or vacated.  This was not sufficient.

Hard to say, but it seems that having read the agreement into the record would have helped her cause here.  However, providing facts in the motion to vacate or amend would have also solved the problem.  At any rate, be careful when you elect not to read the agreement into the record.

Here’s the link…. http://courts.state.ar.us/unpublished/2007a/20070516/ca06-1161.pdf

Assets that are separate property (and therefore not marital property) can become marital property when they are used in certain ways.

This case from the Court of Appeals illustrates how this can happen, much to the chagrin of one of the parties.  Here’s the link… http://courts.state.ar.us/unpublished/2007a/20070307/ca06-722.pdf

Arkansas judges will look to Arkansas Code Annotated 9-12-315 when making property division determinations in a divorce.  Here’s A.C.A. 9-12-315 in its entirety:

§ 9-12-315. Division of property 

   (a) At the time a divorce decree is entered:

   (1) (A) All marital property shall be distributed one-half (1/2) to each party unless the court finds such a division to be inequitable. In that event the court shall make some other division that the court deems equitable taking into consideration:

         (i) The length of the marriage;

         (ii) Age, health, and station in life of the parties;

         (iii) Occupation of the parties;

         (iv) Amount and sources of income;

         (v) Vocational skills;

         (vi) Employability;

         (vii) Estate, liabilities, and needs of each party and opportunity of each for further acquisition of capital assets and income;

         (viii) Contribution of each party in acquisition, preservation, or appreciation of marital property, including services as a homemaker; and

         (ix) The federal income tax consequences of the court’s division of property.

      (B) When property is divided pursuant to the foregoing considerations the court must state its basis and reasons for not dividing the marital property equally between the parties, and the basis and reasons should be recited in the order entered in the matter.

   (2) All other property shall be returned to the party who owned it prior to the marriage unless the court shall make some other division that the court deems equitable taking into consideration those factors enumerated in subdivision (a)(1) of this section, in which event the court must state in writing its basis and reasons for not returning the property to the party who owned it at the time of the marriage.

   (3) (A) Every such final order or judgment shall designate the specific real and personal property to which each party is entitled.

      (B) When it appears from the evidence in the case to the satisfaction of the court that the real estate is not susceptible of the division as provided for in this section without great prejudice to the parties interested, the court shall order a sale of the real estate. The sale shall be made by a commissioner to be appointed by the court for that purpose at public auction to the highest bidder upon the terms and conditions and at the time and place fixed by the court. The proceeds of every such sale, after deducting the cost and expenses of the sale, including the fee allowed the commissioner by the court for his or her services, shall be paid into the court and by the court divided among the parties in proportion to their respective rights in the premises.

      (C) The proceedings for enforcing these orders may be by petition of either party specifying the property the other has failed to restore or deliver, upon which the court may proceed to hear and determine the same in a summary manner after ten (10) days’ notice to the opposite party. Such order, judgment, or decree shall be a bar to all claims of dower or curtesy in and to any of the lands or personalty then owned or thereafter acquired by either party.

   (4) When stocks, bonds, or other securities issued by a corporation, association, or government entity make up part of the marital property, the court shall designate in its final order or judgment the specific property in securities to which each party is entitled, or after determining the fair market value of the securities, may order and adjudge that the securities be distributed to one (1) party on condition that one-half ( 1/2) the fair market value of the securities in money or other property be set aside and distributed to the other party in lieu of division and distribution of the securities.

(b) For the purpose of this section, “marital property” means all property acquired by either spouse subsequent to the marriage except:

   (1) Property acquired prior to marriage or by gift or by reason of the death of another, including, but not limited to, life insurance proceeds, payments made under a deferred compensation plan, or an individual retirement account, and property acquired by right of survivorship, by a trust distribution, by bequest or inheritance, or by a payable on death or a transfer on death arrangement;

   (2) Property acquired in exchange for property acquired prior to the marriage or in exchange for property acquired by gift, bequest, devise, or descent;

   (3) Property acquired by a spouse after a decree of divorce from bed and board;

   (4) Property excluded by valid agreement of the parties;

   (5) The increase in value of property acquired prior to marriage or by gift or by reason of the death of another, including, but not limited to, life insurance proceeds, payments made under a deferred compensation plan, or an individual retirement account, and property acquired by right of survivorship, by a trust distribution, by bequest or inheritance, or by a payable on death or a transfer on death arrangement, or in exchange therefor;

   (6) Benefits received or to be received from a workers’ compensation claim, personal injury claim, or social security claim when those benefits are for any degree of permanent disability or future medical expenses; and

   (7) Income from property owned prior to the marriage or from property acquired by gift or by reason of the death of another, including, but not limited to, life insurance proceeds, payments made under a deferred compensation plan, or an individual retirement account, and property acquired by right of survivorship, by a trust distribution, by bequest or inheritance, or by a payable on death or a transfer on death arrangement, or in exchange therefor.

(c) The court is not required to address the division of property at the time a divorce decree is entered if either party is involved in a bankruptcy proceeding.

The cases interpreting section 315 are far too numerous to be listed here.  But, here are a few major points to remember:

• Generally, marital property is split 50-50.  However, keep in mind that the court has the power to make an unequal division of marital property if the circumstances call for it.  This would be unusual, but not unheard of.  (See Lytle v. Lytle, 266 Ark. 124 (1979); Cavin v. Cavin, 308 Ark. 109 (1992))
• Marital fault is not a factor in division of property.
• Although the presumption is that nonmarital property owned prior to the marriage shall be returned to the party who owned it originally, occasionally nonmarital property may be divided.  (See Williford v. Williford, 280 Ark. 71 (1983)).  But see Hale v. Hale, 307 Ark. 546 (1992) and Farris v. Farris, 287 Ark. 479 (1985), both holding that nonmarital property acquired during the marriage cannot be divided.
• Marital property may include property acquired after separation, but before divorce is final.  This time period is usually after the divorce complaint is filed and before the divorce decree is entered.  (See Askins v. Askins, 288 Ark. 333 (1986))

As always, make sure you keep your attorney advised of any and all property interests and when and how they are/were acquired.

Historically we (family law attorneys) have advised our clients of the pitfalls of appealing domestic relations decisions.  “You have to show abuse of discretion.”  “You have to show that the trial judge made major mistakes, and that’s hard to do.”  “Most appeals are lost.”  “You’ll end up paying me (attorney) alot of money and we won’t win.”  And there’s good reason for saying all of these things to our clients…its true!  However, the Arkansas Court of Appeals last Wednesday reversed a custody award, a property division determination, and an alimony award…all in the same case.  Here’s the link  http://courts.state.ar.us/opinions/2006b/20061206/ca06-660.pdf