Opinion ID: 1183296
Heading Depth: 1
Heading Rank: 1

Heading: Application of the Transmutation Doctrine

Text: The district court characterized certain other properties known as the ranch property [Parcels 3(a) and 3(b)] which were subject to a land sales contract between the parties and the Cadwalladers (the purchasers), as consisting of 160 acres of community property and some 78 acres of respondent's separate property. Respondent, with appellant's consent and acknowledgment, contracted with the Cadwalladers for the sale of the 238 acres at a total sales price of $65,000. The Cadwalladers had made, at the time of the litigation in the trial court, two payments which were equally divided by appellant and respondent. The remaining balance due at that time was $52,200. The trial court, after making the aforementioned characterization, developed a valuation formula for purposes of determining the respective separate and community property interests in the proceeds to be paid on the contract. Neither party challenges the valuation method employed by the trial court, so it will not be questioned on appeal. Supreme Court Rules, Rule 41; See Hammond v. Hammond, 92 Idaho 623, 448 P.2d 237 (1968). In accordance with its valuations, the district court in essence awarded one half of the proceeds attributable to community property and that portion of the proceeds attributable to the separate property to respondent, and awarded the balance to appellant. [3] It is this assessment and disposition of the proceeds that appellant challenges in this appeal. Appellant contends that the parties agreed, at least implicitly, that all the property sold to the Cadwalladers was community property. In other words, appellant asks us to apply the doctrine of transmutation and find that respondent and appellant agreed to convert, or transmute, respondent's separate property portion of the ranch property to community property. The general propriety of the doctrine of informal or oral transmutation and the scope of its applicability present issues of first impression in this jurisdiction. Although the doctrine is recognized to varying degrees in several other community property jurisdictions, [4] nowhere is the concept of oral or informal transmutation more well established or more commonly applied than in California where the agreement need not be formal and property may be transmuted by a mere executed oral agreement. [5] Woods v. Security First Natl. Bank, 46 Cal.2d 697, 299 P.2d 657 (1956). Simply stated, the principle of transmutation in California allows spouses pursuant to agreement inter se to convert or transmute the character of the separate property of one spouse to community property or the community property to the separate property of either spouse. H. Verrall & A. Sammis, California Community Property, 57-59 (1966); See, e.g., Woods v. Security First Natl. Bank, supra . Regardless of whether or not the doctrine of transmutation is applicable in Idaho, the trial court concluded upon the evidence that no transmutation occurred. Appellant puts great weight on the fact that respondent had appellant sign and acknowledge the deed of sale of the property and equally divided with appellant the initial payments from the Cadwalladers. Respondent relied on isolated testimony of both appellant and himself which allegedly established that both spouses were at all times aware of respondent's existing separate property interest in the sale property. From our perusal of the record, it is evident that a substantial conflict in the testimony existed and the trial court ruled that appellant had not met her burden of proof. There was adequate and competent evidence to support that conclusion and it will not be disturbed on appeal. Brammer v. Brammer, 93 Idaho 671, 471 P.2d 58 (1970). Judgment affirmed, but the cause is remanded with directions to the trial court to correct the apparent misreference to defendant instead of plaintiff in paragraphs IX and X of the decree. McQUADE, C.J., and McFADDEN, DONALDSON and SHEPARD, JJ., concur.