Court Opinion

ID: 9664795
Source: CourtListenerOpinion
Date Created: 2023-08-24 00:30:01.182965+00
Date Added: 2024-06-11T18:15:10.255702
License: Public Domain

John I. Purtle, Justice, dissenting. I believe the chancellor was correct in holding that the increase in the certificates of deposit remained the separate property of the wife because the certificates themselves were the result of cash gifts from her parents. The parents gave their daughter sums of money which were invested in CD accounts bearing only her name and that of her son. When interest payments accrued, the payments were simply turned back into another CD. In my opinion the growth in the CD account remained the separate property of the wife. If the parents had given their daughter a block of gold and it had increased in value, I am sure this court would not treat the increase as marital property. Obviously the growth in value of the block of gold could not be considered income or marital property. It is easy to see that such increase is still separate property. Likewise, the CD account has grown and the interest, as well as the principal, remains non-marital property. We have today taken a considerably different position, in my opinion, than we did in Day v. Day, 281 Ark. 261, 663 S.W.2d 719 (1984); and Layman v. Layman, 292 Ark. 539, 731 S.W.2d 771 (1987). I think the majority misinterprets Day because the specific holding in Day is: “What we do hold is simply that earnings or other property acquired by each spouse must be treated as marital property, unless falling within one of the statutory exceptions, and neither one can deprive the other of any interest in such property by putting it temporarily beyond his or her own control, as by the purchase of annuities, participation in retirement, or other device for postponing full enjoyment of the property.” I agree with this statement in Day because it holds that earnings or property acquired by either spouse must be considered marital property unless the statute provides otherwise. Since this property was acquired by gift, it is an exception within the meaning of the statute. In the Layman case, the husband had received both preferred and common stock in a corporation during the marriage. The value of both classes of stock increased by more than a quarter of a million dollars, yet this court held that the preferred stock and its increase remained the separate property of the husband since it had been received by gift from his parents during the marriage. On the other hand, the increase in the value of the common stock was held to be marital property because it was issued by the corporation to the husband, and apparently was based upon his efforts and skill in managing a profitable business. It was not a gift from his parents like the preferred stock. Growth is not earnings. The growth in the present case is not the result of any skill or effort on the part of either spouse. This growth resulted from factors other than the ability or earning capacity of either party. Neither is it income from real property, which was held to be marital property in Speer v. Speer, 18 Ark. App. 186, 712 S.W.2d 659 (1986). Money received from the rental of property is certainly income acquired by the parties during the marriage. It is a result of the efforts and agreement of the parties. Sometimes, it seems to me, that courts strain at a gnat but swallow a camel. The legislature no doubt intended for common sense and logic to apply in cases where a statute does not specifically cover the exact factual situation before the court. The majority opinion admits that the law does not specifically require that the increase in these certificates of deposit be treated as income or that it be treated as marital property. The Speer decision was expressly within the terms of the statute. The majority opinion quotes from the Commissioner’s Note to the Uniform Act as follows: The phrase “increase in value” used in (b)(5) is not intended to cover the income from property acquired prior to the marriage. Such income is marital property. Income from property received prior to the marriage as in Speer or income from property acquired by gift during the marriage is no different than the wages earned by the parties during marriage. It is obviously marital property. However, the growth in the value of the property should remain the separate property of the party who acquired it as a gift. It obviously would if the gift were to depreciate in value. We frequently affirm cases for reasons other than those cited by the trial court. Certainly it seems to me that the chancellor was right but he may have given the wrong reason. The Day opinion has been relied upon as a cure for all ills; it is not. Day specifically stated that we did not attempt to lay down inflexible rules for the future. We stated: “To the contrary, § 34-1214 allows leeway for the exercise of the chancellor’s best judgment, for it provides that all marital property shall be divided equally ‘unless the court finds such a division to be inequitable.’ ” It is apparent from the chancellor’s decree in the present case that he did weigh the equities when he considered the increase in value of the wife’s gift from her parents. Therefore, even if not specifically provided for by the statute, the statute specifically leaves such matters to the discretion of the trial court. As previously stated, the marital property statute does not specifically cover the issue before the court. However, by implication, the increase in the value of the gift remains separate property. Moreover, I do not believe the chancellor’s decision was an abuse of discretion. I would affirm the chancellor.