Court Opinion

ID: 5156690
Source: CourtListenerOpinion
Date Created: 2022-01-02 02:23:09.92262+00
Date Added: 2024-06-11T08:25:23.349539
License: Public Domain

CHRISTEN, Justice,
dissenting in part.
Because the superior court did not make findings explaining why it treated Teresa's separate property as marital, I respectfully dissent from the portion of the court's decision that affirms the characterization of Teresa's pre-marital retirement benefit.
As the court's decision acknowledges, "the general rule is that courts divide property 'acquired only during the marriage"" But today's decision concludes that, in this case, the superior court "had discretion to include in the marital estate property that was acquired during [a] period of premarital cohabi*343tation." I agree that the superior court has some discretion to characterize property acquired before marriage as marital property, but that discretion is not unfettered. Here, the superior court neglected to apply the statutory presumption that pre-marital property is separate property and made no findings to suggest that its invasion of pre-mari-tal property was warranted by a "balancing of the equities." This was contrary to our case law and AS 25.24.160.
We have long applied the rule that "one spouse's separate property ... should not be deemed a marital asset available for division unless the court specifically finds that a balancing of the equities between the parties requires invasion of the premarital holding." 1 Without such a finding, a superior court does not have the discretion to invade pre-marital assets.2 We applied this rule to property acquired by one spouse during a period of pre-marital cohabitation in Murray v. Murray, where we determined that the superior court must "assess whether the equities require invasion of separate assets under AS 25.24.160(a)(4); and if so ... enter explicit findings to that effect."3 This case law is faithful to the plain language of AS 25.24.160(a)(4), which only permits a superior court to "invade the property ... of either spouse acquired before marriage when the balancing of the equities between the parties requires it."
Our ruling in Fawlkner v. Goldfuss4 was also consistent with this rule of law. Today's decision implies that Faulkner somehow dispensed with the requirement that the superi- or court expressly balance the equities before invading pre-marital property, but nowhere in Fowllmer did we explicitly or implicitly overrule Murray. Faulkner quoted Murray for the proposition that "the trial court is free to consider the parties' entire relationship, including any period(s) of premarital cohabitation,5 and upheld the superior court's determination that a retirement benefit earned during pre-marital cohabitation was marital property6 Fawlkner did not specifically state that the superior court had balanced the equities before invading premarital property, but nothing in the opinion suggests that we intended to abrogate the longstanding rule established by the statute and our case law.
We have applied and expressly reaffirmed this rule in multiple decisions since Faulkner. For example, in Chase v. Chase we upheld the superior court's characterization of assets acquired during pre-marital cohabitation as marital property because the superior court made specific findings supporting its invasion of separate property.7 The superior court identified equitable considerations-such as the use of a pre-marital piece of property as the family home and one spouse's unpaid work in the home-to justify its invasion of pre-marital property; we affirmed this invasion "[blecause the decision to categorize the property as marital [was] sufficiently supported by the superior court's *344findings. ..." 8 Our decision in Chase demonstrates that while "a 'talismanic' reference to Murray or a formalistic invocation' of particular language" is not required,9 we do require some findings demonstrating the propriety of invading pre-marital property.10 We have also explicitly affirmed this rule, as applied to pre-marital property generally,11 in multiple cases subsequent to Faulkner.12
It is not disputed that ten years of Teresa's retirement benefit accrued after the parties began living together, but today's decision states "[the superior court characterized the portion of Teresa's civil service retirement that she earned in the ten years of cohabitation preceding the couple's legal marriage as part of the marital estate." In fact, the superior court did not find that marital property began to accrue ten years before the parties married (when Teresa's divorce from her previous husband became final). © Nor did the court explain why it might have been appropriate to deem assets acquired after that date to be marital. Instead, the superior court's findings reflect that it adopted Darren's expert's valuation of Teresa's retirement. Not surprisingly, Darren's expert valued Teresa's retirement in the way that was most favorable to Darren: he assumed that the marital estate began to accrue immediately after Teresa's divoree from her previous husband became final. The superior court adopted the following finding from Darren's proposed findings of fact:
The marital portion of her retirement has been calculated to be worth $189,532. This valuation is based upon the assumption that the marital interest in such retirement started accruing on July 1, 1989 when the parties were liwing together. Teresa agreed to the valuation of her retirement.13
The assumption made by Darren's expert was not consistent with Alaska law; it was consistent with the valuation of the marital portion of Teresa's asset in a way that was most beneficial to Darren. Tellingly, even Darren does not argue that the superior court found the marital estate began to accrue once the parties began living together. Darren argued on appeal that the superior court's characterization of this asset was either a sanction for Teresa's failure to attend *345her deposition, or that the inclusion of the pre-marital portion of Teresa's retirement was justifiable because Teresa caused a dissipation of the marital estate by allowing the parties' home to go into foreclosure or by failing to winterize the parties' motor home. None of these theories withstand scrutiny. The superior court did not find that Teresa dissipated the marital estate; it made no findings or conclusions that suggest it intended to sanction Teresa by invading her separate property; and it did not make any findings about responsibility for the marital home going into foreclosure. The superior court simply treated Teresa's pre-marital asset as a marital asset. No balancing of the equities took place; no explanation was provided for the invasion of Teresa's pre-marital property.
Today's decision speculates that the superior court relied on testimony describing the parties' pre-marital cohabitation to treat Teresa's separate property as marital, and asserts that this testimony supports the superior court's "implicit finding" that the balancing of the equities justified invading Teresa's retirement. But it is not this court's role to guess a superior court's reasons for invading pre-marital property.14 The Murray rule provided us with a clear record on appeal setting out the equitable considerations supporting a superior court's invasion of premarital property.15 In contrast, today's decision speculates that the superior court considered testimony regarding the character of the parties' pre-marital cohabitation; we have no substantive indication that the court in fact relied on this testimony in invading pre-marital property. And if the superior court instead determined that separate property acquired during pre-marital cohabitation was presumptively marital, it abused its discretion. We have no way of knowing which of these rationales motivated the superior court's characterization, and this uncertainty frustrates effective appellate review.16
Another troubling consequence of the decision issued today is that it gives no guidance to litigants, practitioners, or superior court judges about when pre-marital assets may be invaded. In my view, it is inherently unfair to leave litigants guessing about what ground rules will be applied by the superior court when marital assets are divided. Experience tells us that uncertainty about the law hinders settlement efforts and increases litigation costs.
Because the superior court's findings suggest that the statutory presumption regarding pre-marital property was reversed in this case, and because the findings give no indication of why Teresa's pre-marital retirement was treated as a marital asset, I would reverse this part of the superior court's decision and remand for additional findings on the propriety of invading Teresa's pre-mari-tal retirement benefit.

. Brooks v. Brooks, 733 P.2d 1044, 1053 (Alaska 1987) (quoting Carlson v. Carlson, 722 P.2d 222, 224 (Alaska 1986)) (emphasis added) (internal quotation marks omitted); see also Harrelson v. Harrelson, 932 P.2d 247, 250-51 (Alaska 1997) (remanding superior court's characterization of pre-marital property as marital because court did not make "the proper property distinction mandated by Murray and AS 25.24.160(a)(4}."); Cox v. Cox, 882 P.2d 909, 915 (Alaska 1994) (remanding because superior court's findings failed to adequately distinguish between pre-marital and marital property); Rhodes v. Rhodes, 867 P.2d 802, 804-05 (Alaska 1994) (remanding because superior court did not make "adequate findings on whether {disputed property was] marital or separate property."); Murray v. Murray, 788 P.2d 41, 42 (Alaska 1990) (requiring "explicit finding" that balancing of equity favors division of premarital property).

. Brooks, 733 P.2d at 1053.

. 788 P.2d at 42 (emphasis added); see also Harrelson, 932 P.2d at 250-51 (remanding superior court's unexplained characterization of property acquired during pre-marital cohabitation as marital property).

. 46 P.3d 993 (Alaska 2002).

. Id. at 1002-03 (quoting Murray, 788 P.2d at 42).

. Id.

. 109 P.3d 942, 947-49 (Alaska 2005).

. Id. at 947.

. Han‘elson, 932 P.2d at 251 n. 5.

. Chase, 109 P.3d at 947-48 (identifying trial court findings on equitable considerations); see also Abood v. Abood, 119 P.3d 980, 988 (Alaska 2005) (citing Murray and ruling that superior court could properly consider period of pre-mari-tal cohabitation "as long as the trial court recognized that the home was originally ... separate property"). Today's decision cites Faulkner for the proposition that we do not require "explicit factual findings about either (1) the parties' intent to treat the property as marital or (2) the need to treat the property as marital in order to do equity." But as noted, our case law does not establish 'a rule requiring enumerated factors to be explicitly considered or specific language to be invoked. Harrelson, 932 P.2d at 251 n. 5. What we do require is that the superior court acknowledge that it is invading separate property and make findings of fact to support the invasion. See Abood, 119 P.3d at 988. Faulkner did not dispense with this requirement.

. To the extent that today's decision draws a distinction between separate property acquired during pre-marital cohabitation and all other pre-marital separate property, I find this distinction unpersuasive. Alaska does not recognize common law marriage, and Alaska law is not premised on the assumption that all property acquired during pre-marital cohabitation should be considered marital property. Like other property acquired by one spouse prior to marriage, property acquired during pre-marital cohabitation is presumptively separate property; it may be characterized as marital property, but only if the superior court makes findings justifying the invasion. Murray, 788 P.2d at 42. Nether the statute nor the case law singles out separate property acquired during cohabitation as unique, and today's decision does not articulate why it should be treated any differently.

. See, eg., Barnett v. Barnett, 238 P.3d 594, 600 (Alaska 2010) ("property acquired before the marriage ... should not be treated as part of the marital estate ... unless the court specifically finds that balancing of the equities requires invasion of the premarital holding."); Rodvik v. Rod-vik, 151 P.3d 338, 350 (Alaska 2006) (noting that "a decision to invade separate property must be accompanied by specific findings justifying the invasion."); Odom v. Odom, 141 P.3d 324, 340 (Alaska 2006) ("decision to invade separate property may be undertaken only after the trial court has attempted to use the marital estate to balance the equities") (internal quotations omitted).

. Emphasis added.

. See Borchgrevink v. Borchgrevink, 941 P.2d 132, 143 (Alaska 1997) ("[The role of the appellate court in the judge-tried case is to review only what the trial court has found, not what the trial court might have found.").

. Murray, 788 P.2d at 42.

. Our case law reveals that the failure to distinguish between cohabitation and marriage can derail appellate review, causing unnecessary expense and delay for the parties. In Harrelson v. Harrelson, we remanded for additional findings of fact because the superior court committed clear error by finding that the parties had been married for eight years, a period that included a few years during which they were merely cohabitants. 932 P.2d 247, 250-51 (Alaska 1997). We noted that the superior court had the discretion to consider the parties' pre-marital cohabitation, but we reversed its decision "because it [was] unclear to what extent the court's treatment of the duration of the marriage influenced the property division." Id. at 251. We elaborated that while we do not require "a 'talismanic reference' to Murray or a 'formalistic invocation' of particular language," we must be provided with a record that allows for accurate appellate review. Id. at 251 n. 5. Today's decision blurs the line between assets acquired during pre-marital cohabitation and assets acquired during marriage, adding confusion to the already-difficult process of characterizing and valuing marital estates.