The Court of Appeals decision in Flower v. Flower, issued on 2-25-2010, expanded on Toth somewhat, to the effect that a jointly-titled house may be divided in other than a 50-50 division, depending on the particular equities of the case. The Flower Husband and Wife each owned a home at the time of their marriage. The couple resided in Husband’s home for several months, and Husband changed title to his home to make Wife a co-owner (community property with right of survivorship). The couple took on debt during the marriage, and at least $30,000 of that debt was used to make improvements on Wife’s separate property home. Title to Wife’s home was not changed—-it remained solely in her name.
The marriage lasted approximately one year, until Husband filed a Petition for Annulment, claiming that the marriage was a sham. Wife claimed she was entitled to one-half the value of Husband’s home as a gift to her. Husband had owned that home for approximately 17 years prior to the marriage. Husband claimed that Wife’s name was added to the title to his home due to misunderstanding, fraud or coercion. The second lien on Husband’s home was taken out during this brief marriage to finance the $30,000 improvements that were made to Wife’s home. Wife claimed that the $30,000 which was contributed to her separate property home was also a gift from Husband to her.
In considering the division of Husband’s home, the trial court determined that it was required to consider issues of fairness and equity, and found that this case falls within the rare exception to the general rule that community property should be divided substantially equally. The court awarded 100% of Husband’s house to Husband and found that to the extent that equity required any portion to be awarded to Wife, Wife had received equity through the $30,000 in improvements to her separate property home. Wife was awarded her home, with no community lien or interest therein.
The appellate court recognized that transferring title presumes a gift, but acknowledged that equitable principles apply, so that jointly-held property may be divided equitably rather than equally. Citing Toth, the court noted that property need not be divided substantially equally “if sound reason exists to divide the property otherwise.” The court noted that Wife did not assert that she made any contributions to Husband’s home, either monetary or of community effort, and noted that the amount of Husband’s equity in the home was actually reduced during the marriage (because of the second lien of $30,000). “Wife’s lack of contributions provides at least partial justification for a substantially unequal division of the community property . . . .”
At Section 27 of its opinion, the Court notes ” . . . it has long been held that when community funds are expended to improve the separate property of one spouse, the community does not acquire an interest in the separate property, but it does acquire a claim for reimbursement of the separate property in accordance with the amount of the community funds expended.” Kingsbery and Lawson v. Ridgeway are cited in support of that notion; but Drahos v. Rens and Honnas are not mentioned. The latter three cases clearly hold that the community has an equitable lien (not a claim for reimbursement) for community funds expended on a separate property residence.
In a discussion about how the length of marriage fits into the analysis of equitable division, the appellate court noted that the length of the marriage is one factor to be considered in the equities of a property division, and further noted that “[b]y almost any account, this would be considered a short marriage”, thereby rejecting Wife’s attempt to argue that a marriage that lasts longer than one year should be considered of “significant duration”.
The court ended by recognizing that a substantially unequal division of community property must continue to be a rare exception and issued a caution that this opinion should not be used as “automatic justification” for an unequal property division, even in another case involving a short-duration marriage. ” . . . [T]he equitable divestment of a gifted property interest will still be inappropriate in the vast majority of dissolution proceedings.”
Which again makes one wonder: How DOES the Court of Appeals determine what cases will be published opinions rather than Memorandum decisions, and if the Flower’s situation is such a rare exception, why publish it?