140 Nev., Advance Opinion 14 

IN THE SUPREME COURT OF THE STATE OF NEVADA 

ROBERT M. DRASKOVICH, 

Appellant/Cross-Respondent, 

vs. 

LAURINDA F. DRASKOVICH, 

Respondent/Cross-Appellant. 

No. 84998 

FILE 

MAR 2 1 2024 

A BROWN 

DEP CLERK 

Appeal and cross-appeal from a district court decree of divorce. 

Eighth Judicial District Court, Family Division, Clark County; Bryce C. 

Duckworth, Judge. 

Reversed in part, vacated in part, and remanded. 

The Pariente Law Firm, P.C., John Glenn Watkins and Michael D. Pariente, 

Las Vegas, 

for Appellant/Cross-Respondent. 

Law Offices of F. Peter James, Esq., and F. Peter James, Las Vegas, 

for Respondent/Cross-Appellant. 

BEFORE THE SUPREME COURT, CADISH, C.J., and STIGLICH and 

PICKERING, JJ. 

OPINION 

By the Court, CADISH, C.J.: 

In this divorce case, we consider whether a law firm, 

established by one spouse before the marriage and incorporated under a 

different name during the marriage, constitutes that spouse's separate 

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property. We hold that the district court erred in determining that the law 

firm was entirely community property because the uncontested evidence 

demonstrated that, even after incorporation, it was a continuation of the 

spouse's original, separate property law practice, and thus, the presumption 

of community property does not properly apply. Further, because the 

district court refused to award alimony based in part on its erroneous 

community property determination, we necessarily vacate that ruling and 

remand for further proceedings consistent with this opinion. 

FACTS AND PROCEDURAL HISTORY 

Appellant/cross-respondent Robert Draskovich has been 

practicing criminal law since 1997. At the time he and respondent/crossappellant Laurinda Draskovich married in 2012, he was a partner at Turco 

& Draskovich (T&D) with a 65% ownership stake in the firm. At T&D, 

Robert and the only other partner were paid separately for the work they 

each performed, and each partner maintained his own staff and clients, 

although they shared a bank account and paid taxes together. Laurinda 

brought no significant financial assets to the marriage and was a 

homemaker throughout the marriage. 

In December 2018, T&D dissolved, and the next month, Robert 

incorporated the Draskovich Law Group (DLG) as his wholly owned 

corporation. Robert later offered uncontested testimony that DLG was "the 

very same practice" as his share of T&D. Robert kept the same office 

location, as well as his clients, staff, assets, and practices, after the 

incorporation and stated that he changed only the letterhead and the name 

stickers on the firm vehicles to match the name change of the firm. By the 

time Robert and Laurinda began divorce proceedings in 2022, DLG was 

worth approximately $1,210,000. 

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At trial, DLG was the primary asset in dispute. To analyze the 

value of DLG, Robert and Laurinda jointly retained a forensic accountant. 

The accountant determined the present value of DLG, but neither party 

asked her to determine the historic value of the practice. The accountant 

also noted during trial that she could not provide any valuation for a 

separate property share of DLG because neither party had engaged her to 

allocate the separate and community property interests. 

After a two-day trial, the district court concluded that DLG was 

community property. The district court relied on the date of DLG's 

incorporation to find that DLG was acquired during the marriage and was 

thus presumptively community property under NRS 123.220. The district 

court then concluded that Robert had failed to overcome the community 

property presumption because he had not offered clear and convincing 

evidence regarding the value of any separate property interest in DLG, 

rendering the entire practice community property. 

The district court also considered and rejected Laurinda's 

request for rehabilitative and periodic alimony. While the district court 

found that some factors supported alimony, the court did not award alimony 

at least in part because the court determined that the share of community 

assets distributed to Laurinda would provide sufficient support through 

passive income. Robert now appeals, and Laurinda cross-appeals. 

During oral argument before this court, Laurinda's attorney 

conceded that T&D was separate property with a community property 

component and that had the divorce occurred in 2018, it would have been 

Laurinda's burden to show a community property share of T&D. Robert's 

counsel conceded during oral argument that DLG almost certainly did 

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contain some community property interest subject to at least some 

apportionment. 

DISCUS SION 

Robert and Laurinda ask this court to consider DLG's status 

and the question of alimony, and we therefore consider only those two issues 

in this opinion and do not opine on the rest of the district court's judgment. 

See Powell v. Liberty Mut. Fire Ins. Co., 127 Nev. 156, 161 n.3, 252 P.3d 668, 

672 n.3 (2011) (declining to consider issues not properly raised by the 

parties). We first address the division of DLG's value. In this, we consider 

the proper character of DLG as separate or community property. 

Concluding that Robert brought the business into the marriage with him, 

we hold that DLG is Robert's separate property, and the community 

property presumption does not apply. Yet, because the business may have 

grown owing to community resources, Laurinda must be given an 

opportunity to show a community portion of DLG by clear and convincing 

evidence such that the district court may have to apportion DLG between 

the separate and community property interests. Finally, we consider the 

question of alimony and conclude that, given the change in circumstances 

concerning the parties' community property, alimony must be reconsidered. 

DLG represents the continuation of T&D and is Robert's separate property 

"When reviewing a district court's determination of the 

character of property, this court will uphold the district court's decision if it 

was based on substantial evidence. However, we will review a purely legal 

question, such as the application of a presumption, de novo." Waldman v. 

Maini, 124 Nev. 1121, 1128, 195 P.3d 850, 855 (2008). We therefore review 

the district court's factual classification of DLG with deference but review 

the application of the community property presumption to DLG de novo. 

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With limited exceptions, Nevada law provides that "[a]ll 

property, other than that stated in NRS 123.130, acquired after marriage 

by either spouse or both spouses, is community property...." NRS 

123.220. We have held that any property acquired during the marriage is 

presumptively community property, and the spouse claiming such property 

as their separate property must prove their interest by clear and convincing 

evidence. Pryor v. Pryor, 103 Nev. 148, 150, 734 P.2d 718, 719 (1987). This 

presumption and burden also apply to entities created during the marriage 

from mixed community and separate funds. See Moberg v. First Nat'l Bank 

of Nev., 96 Nev. 235, 237, 607 P.2d 112, 114 (1980) (presuming property 

purchased during the marriage with funds of uncertain origin was 

community property). By contrast, any property a spouse brings into a 

rnarriage, along with the "rents, issues and profits thereof," is that spouse's 

separate property. NRS 123.130; see Smith v. Smith, 94 Nev. 249, 251, 578 

P.2d 319, 320 (1978). 

Caselaw from this court and from California, which this court 

often looks to for principles of community property, shows that the date of 

incorporation is not the decisive factor in determining a property's 

character. Rather, the court must look to the totality of the circumstances 

to determine whether a business is an asset acquired during the marriage 

and thus presumptively community property, or merely a continuation of a 

pre-marriage enterprise and thus separate property. Schulman v. 

Schulman, a case involving a husband who owned a wholesale meat 

processor as a sole proprietorship for approximately 40 years before his 

marriage, is illustrative. 92 Nev. 707, 709, 558 P.2d 525, 526 (1976). Four 

years after marrying and continuing to run his business as a sole 

proprietorship, the husband incorporated the business, received all shares 

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of the newly incorporated business, and undertook operations expansions, 

but the essential nature and character of the business remained unchanged. 

Id. at 709, 558 P.2d at 526-27. We concluded apportionment between 

separate and community interests was necessary. Id. at 716-17, 558 P.2d 

at 530. In determining that the underlying business remained the 

husband's separate property, this court implicitly determined that the date 

of incorporation alone did not dictate the character of the property. 

California has likewise declined to consider an act of 

incorporation as dispositive, opting instead to consider the essential 

character of the business in dispute. Take, for instance, In re Marriage of 

Koester, where a husband operated his business as a sole proprietorship 

before the marriage and incorporated the operation during the marriage. 

87 Cal. Rptr. 2d 76, 79 (Ct. App. 1999). The court reasoned that the 

incorporation represented a mere change in "form or identity" and thus did 

not represent the acquisition of new property; all customers and accounts 

receivable were the same before and after the incorporation. Id. at 80. The 

court concluded that "Rjo say ... that an asset was 'acquired' by the 

community... because some aspect of corporate formation took place 

during the marriage is to elevate semantics over substance." Id. at 81. 

Here, in determining that DLG was community property, the 

district court relied exclusively on the fact that DLG was incorporated 

during the marriage. The district court deemed this single fact dispositive 

and characterized DLG as entirely community property by applying the 

community property presumption. That analysis was incorrect. We now 

expressly hold that district courts must consider the totality of the 

circumstances when determining whether a business represents the 

continuation of a pre-marriage enterprise. 

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The parties do not contest the salient circumstances present in 

this case. Robert testified that he operated functionally the same business 

before and after the change from T&D to DLG. All his assets, staff, pay, 

and clients remained the same when he practiced at T&D and at DLG. 

Robert remained in the same office location. His testimony established that 

he only changed the letterhead on his papers and the name on the firm 

vehicles to match the new name. As in Schulman and In re Marriage of 

Koester, this is unrebutted evidence that DLG was a continuation of 

Robert's interest in T&D—a mere change in form or identity of his share in 

T&D—rather than a new property acquisition. DLG is thus his separate 

property under the totality of the circumstances, and the district court erred 

by instead relying on the date of incorporation alone to apply the community 

property presumption. We therefore reverse the portion of the divorce 

decree pertaining to the DLG interests and remand for further proceedings 

as instructed below. 

Laurinda bears the burden to show a community portion of DLG 

Robert's business is likely not presently worth the same amount 

as it was at the time of his marriage to Laurinda in 2012. A business can 

increase in value over time from separate property input or from community 

property input. Where an increase in the value of a property stems from 

both, "that increase should be apportioned between separate and 

community property." Johnson v. Johnson, 89 Nev. 244, 246, 510 P.2d 625, 

626 (1973). The "rents, issues, and profits" of separate property 

presumptively remain separate. Srnith, 94 Nev. at 251, 578 P.2d at 320. 

Therefore, when a spouse claims that the increase in value of separate 

property is partially attributable to the community, that spouse must show 

clear and convincing evidence of the community share. Kelly v. Kelly, 86 

Nev. 301, 310, 468 P.2d 359, 365 (1970) (citing, inter alia, Barrett v. Franke, 

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46 Nev. 170, 208 P. 435 (1922)) ("Appellant has therefore not proven by clear 

and satisfactory proof these assets were purchased with community funds 

or credit or acquired by . . . community toil or talent."); see also Sprenger v. 

Sprenger, 110 Nev. 855, 858, 878 P.2d 284, 286 (1994) ("Transmutation from 

separate to community property must be shown by clear and convincing 

evidence."). 

Here, Robert brought the business into the marriage, so it is his 

separate property, and any increase in its value over time is also presumed 

to be separate. See Smith, 94 Nev. at 251, 578 P.2d at 320. This means 

Laurinda bears the burden of showing by clear and convincing evidence that 

a portion of any increase to his practice's value over the course of the 

marriage belongs to the community. The community is entitled to that 

portion of the property "purchased with community funds or credit or 

acquired by. . community toil or talent." Kelly, 86 Nev. at 310, 468 P.2d 

at 365. Laurinda can demonstrate this by showing that Robert's active 

work as an attorney at the firm during the period of the marriage increased 

the value of the firm in some way. See Sly v. Sly, 100 Nev. 236, 240, 679 

P.2d 1260, 1263 (1984) (citing Ormachea v. Ormachea, 67 Nev. 273, 297, 

217 P.2d 355, 467 (1950)) (noting that "Mlle labor and skills of a spouse 

belong to the community"). If, on remand, Laurinda meets her burden to 

make such a showing, the district court must then apportion the property 

between separate and community interests, an undertaking Robert 

conceded in oral argument would likely be necessary should DLG be 

classified as his separate property. 

Because the district court mischaracterized DLG as entirely 

community property, it did not determine whether Laurinda had provided 

clear and convincing evidence of a community share of DLG such that an 

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apportionment between separate and community interests of the firm 

would be necessary. On remand, we instruct the district court to follow 

Kelly v. Kelly and permit Laurinda to provide clear and convincing evidence, 

if she has such, that any part of DLG's value can be attributed to 

((community toil or talent" (or other community sources) and determine 

whether apportionment of DLG's value between separate and community 

interests is appropriate. 

We necessarily vacate and remand as to alimony in light of the changed 

community property circumstances 

"The decision of whether to award alimony is within the 

discretion of the district court." Kogod v. Cioffi-Kogod, 135 Nev. 64, 66, 439 

P.3d 397, 400 (2019). The court should ultimately award such alimony "as 

appears just and equitable." NRS 125.150(1)(a). Central to the district 

court's determination to deny alimony in this case was its finding that 

Laurinda would be able to earn a passive income of more than $3,000 per 

month based on the liquid assets she received from community property. 

See Kogod, 135 Nev. at 74-75, 439 P.3d at 406 (requiring district courts to 

consider the passive income generation capacity from community property 

when awarding alimony). 

As detailed, the district court must reconsider its community 

property determination with respect to DLG. The court will therefore need 

to revisit its alimony analysis following its decision as to any distribution to 

Laurinda for DLG's value. For that reason, we vacate and remand the 

district court's alimony determination for further consideration in light of 

the changed circumstances surrounding DLG. 

CONCL USION 

Courts must consider the totality of the circumstances when 

determining whether a disputed business interest represents a new 

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acquisition or purchase subject to the community property presumption or 

merely the continuation of a spouse's preexisting enterprise and thus 

separate property, subject to a subsequent apportionment. Under the 

totality of the circumstances in this case, DLG's incorporation alone does 

not show that it was a newly acquired community property business, and 

the undisputed evidence makes clear that DLG is simply a continuation of 

Robert's pre-marriage legal practice. Thus, DLG is Robert's separate 

property, though on remand Laurinda may show by clear and convincing 

evidence that growth in the business during the marriage is attributable to 

community resources and apportionment is appropriate. The district 

court's application of the community property presumption to DLG based 

solely on the fact of DLG's incorporation during the marriage was, therefore, 

legal error. Because the district court erred in concluding that DLG was 

community property and applying the community property presumption, 

we reverse the portion of the decree dividing DLG interests as community 

property. In addition, we vacate the portion of the decree denying alimony. 

We remand for further proceedings consistent with this opinion. 

, C.J. 

Cadish 

We concur: 

 J. 

Stiglich 

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