Court Opinion

ID: 5134748
Source: CourtListenerOpinion
Date Created: 2021-12-14 18:02:35.722645+00
Date Added: 2024-06-11T08:23:45.741589
License: Public Domain

IN THE
            ARIZONA COURT OF APPEALS
                            DIVISION ONE

                           In re the Matter of:

               PAMELA ANDREWS, Petitioner/Appellee,

                                    v.

               SCOTT ANDREWS, Respondent/Appellant.

                       No. 1 CA-CV 20-0605 FC
                           FILED 12-14-2021

          Appeal from the Superior Court in Maricopa County
                         No. FN2019-050941
              The Honorable Melissa Iyer Julian, Judge

  AFFIRMED IN PART; REVERSED IN PART AND REMANDED IN
                         PART

                              COUNSEL

Jeffrey M. Proper PLLC, Phoenix
By Jeffrey M. Proper
Counsel for Petitioner/Appellee

Davis Miles McGuire Gardner PLLC, Tempe
By Spencer T. Schiefer
Counsel for Respondent/Appellant
                        ANDREWS v. ANDREWS
                          Opinion of the Court

                                OPINION

Presiding Judge Peter B. Swann delivered the opinion of the court, in which
Judge David D. Weinzweig and Judge Paul J. McMurdie joined.

S W A N N, Judge:

¶1           Scott Andrews (“Husband”) appeals from a dissolution
decree awarding Pamela Andrews (“Wife”) spousal maintenance,
characterizing accumulated vacation pay as community property to be
divided equally, and denying his claim for reimbursement for home loan
and other expenses he paid during the dissolution proceedings.

¶2           We hold that the superior court acted within its discretion in
awarding spousal maintenance, but that it lacked sufficient evidence to
characterize the accumulated vacation pay as community or separate
property and improperly ignored evidence that Husband made loan
payments on the marital property. Accordingly, we (1) affirm the spousal
maintenance award; (2) reverse and remand so that the superior court can
determine whether the accumulated vacation pay was reimbursable (and
therefore community property) or not reimbursable (and therefore separate
property); and (3) reverse and remand so that the court can consider the
evidence that Husband made loan payments for the marital property.

                FACTS AND PROCEDURAL HISTORY

¶3            Wife and Husband married in 1991. Throughout the
marriage, the parties worked for American Airlines: Husband as a pilot and
Wife as a flight attendant.

¶4             In 2019, Wife petitioned for dissolution. Because she was then
recovering from a work-related injury and not working, she sought
temporary spousal maintenance. The superior court ordered Husband to
pay temporary spousal maintenance of $2,200 per month, plus the loan and
other expenses related to the couple’s marital and rental residences and
minimum community credit card payments. The court later reduced the
temporary spousal maintenance to $1,200 per month after Wife returned to
work and, by virtue of the parties’ agreements under ARFLP 69 to divide
certain assets, became able to access without penalty half of $1.3 million in
retirement benefits.

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                        ANDREWS v. ANDREWS
                          Opinion of the Court

¶5          The matter proceeded to trial regarding issues not resolved
by the parties’ agreements, including spousal maintenance, the
community- or separate-property classification of the parties’ accumulated
vacation time, and Husband’s entitlement to reimbursement for
community expenses he paid after the petition for dissolution was served.

¶6             Regarding spousal maintenance, the superior court
concluded in the dissolution decree that Wife was entitled to maintenance
of $5,000 per month for an indefinite term. Regarding accumulated
vacation pay, the court concluded that such pay accumulated during the
community was community property, but found that Husband had
willfully failed to disclose necessary valuation information and ordered the
parties to exchange valuation documents to enable an equal division of the
vacation pay. Regarding Husband’s reimbursement claim, the court
concluded that Husband had failed to provide evidence supporting his
claim. The court awarded attorney’s fees and costs to Wife, and denied
Husband’s motion to amend the decree. Husband appeals.

                              DISCUSSION

I.    THE SUPERIOR COURT DID NOT ABUSE ITS DISCRETION WITH
      RESPECT TO THE SPOUSAL MAINTENANCE AWARD.

¶7             Husband contends that the superior court abused its
discretion by awarding spousal maintenance in the amount of $5,000 per
month because the evidence did not establish that health conditions beyond
Wife’s control precluded her from working full-time and because her
claimed expenses were not reasonable. We review a spousal maintenance
award for an abuse of discretion and will affirm if any reasonable evidence
supports it. Helland v. Helland, 236 Ariz. 197, 202, ¶ 22 (App. 2014). We do
not reweigh the evidence on appeal. Hurd v. Hurd, 223 Ariz. 48, 52, ¶ 16
(App. 2009). We defer to the superior court’s credibility determinations and
will affirm the court’s ruling if it is supported by substantial evidence—
even if conflicting evidence also exists. Id.

¶8            We hold that the court did not abuse its discretion in
determining the amount of the maintenance award. The amount of spousal
maintenance is determined based on multiple factors, including the age of
the spouse seeking maintenance, the marital standard of living, the length
of the marriage, the ability of the spouse from whom maintenance is sought
to meet his or her own needs while paying maintenance, and the spouses’
comparative financial resources, including their comparative earning

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                         ANDREWS v. ANDREWS
                           Opinion of the Court

abilities. A.R.S. § 25-319(B). Husband challenges only two factors: Wife’s
earning ability and her expenses.

¶9             Reasonable evidence supported the conclusion that part-time
work was more appropriate for Wife than full-time work. Wife testified
that full-time work exacerbated her asthma and other respiratory and
medical conditions, which had caused her to miss a significant amount of
work. She testified that since she started a part-time work schedule in 2014,
her symptoms decreased. Wife’s doctor stated that Wife had fewer asthma-
related office visits when she was off work recovering from a work-related
injury, and he opined that she might benefit from a less intensive work
schedule. Husband contends that the superior court ignored evidence that
Wife’s conduct contributed to her health problems and inability to work
full-time. Wife admitted to having dogs, vaping, and occasionally smoking.
Her doctor opined that smoking and having pets can exacerbate breathing
problems. But he also noted that eliminating smoking and pets does not
always alleviate significant asthma. And, as the court found, Wife also had
non-respiratory medical issues—namely, diabetes, high blood pressure,
and a history of shoulder and elbow surgeries.

¶10            Regarding Wife’s expenses, Husband challenges only three of
the expenses identified in Wife’s 2020 financial affidavit, which claimed
total monthly expenses of approximately $8,200. First, Husband challenges
the financial affidavit’s statement that Wife’s health insurance cost $427 per
month. He contends that it cost $340 per month. This argument fails
because the court specifically adopted the $340 figure. Next, Husband
contends that Wife’s home loan obligation would be reduced when she
refinanced as ordered by the court. He suggests that she could obtain a
lower interest rate and could significantly mitigate her payments by using
the funds she received in the dissolution to pay down the loan balance. But
other than Husband’s speculative testimony, there was no evidence
supporting his assertion that Wife’s refinanced loan payments would be
significantly lower. Finally, Husband contends that Wife unreasonably
contributed $150 per month to her mother. But even if Husband were
correct regarding this small amount, that error would not significantly alter
Wife’s monthly expenses, on top of which the court ordered her to pay
approximately $8,000 in community credit card debts. And in contrast to
her significant monthly expenses, the evidence showed that Wife’s monthly
gross income was approximately $3,000 and that she could expect to earn
approximately $600 per month in interest from the equally divided
retirement accounts.

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                         ANDREWS v. ANDREWS
                           Opinion of the Court

¶11           Husband’s challenges to the spousal maintenance award fail
to establish an abuse of discretion by the superior court. We therefore
affirm the award.

II.    THE EVIDENCE WAS INSUFFICIENT TO PERMIT THE
       SUPERIOR  COURT     TO    DETERMINE    WHETHER
       ACCUMULATED     VACATION     PAY    CONSTITUTED
       COMMUNITY OR SEPARATE PROPERTY.

¶12            Husband contends that the superior court committed legal
error by concluding that the parties’ accumulated vacation pay was a
divisible community asset.1 Whether a benefit is community or separate
property is a mixed question of law and fact that we review de novo.
Sebestyen v. Sebestyen, 250 Ariz. 537, 540, ¶ 9 (App. 2021).

¶13            Property earned through a spouse’s labor during a marriage
is community property—even if the property is not received until after the
community ends. Id. at ¶ 10; see, e.g., Koelsch v. Koelsch, 148 Ariz. 176, 181
(1986) (“[P]ension plans are a form of deferred compensation to employees
for services rendered, and any portion of the plan earned during marriage
is community property.”). Deferred compensation such as vested or non-
vested pension rights therefore are community property if earned during
the marriage. See Koelsch, 148 Ariz. at 181; Brebaugh v. Deane, 211 Ariz. 95,
98, ¶ 8 (App. 2005).

¶14           Because Arizona courts had not yet resolved the issue of
whether accumulated paid leave constitutes deferred compensation, the
superior court followed In re Marriage of Moore, 171 Cal. Rptr. 3d 762, 770–
71 (Cal. Ct. App. 2014), which held that a spouse’s accrued vacation time is
community property if it can be cashed in at retirement. Similarly, In re
Marriage of Cardona & Castro, 316 P.3d 626, 634, ¶¶ 29–30 (Colo. 2014), held
that accrued leave constitutes community property when the employee
spouse has an enforceable right to be paid for it. As Cardona noted,
“whether courts treat a spouse’s accrued leave as marital property

1      We note that though the parties disputed the classification of both
accumulated vacation pay and accumulated sick pay at trial, Husband was
not aggrieved by the superior court’s ruling that the sick pay was not
divisible, and Wife did not cross-appeal. We therefore do not address the
sick-pay ruling. See Douglas v. Governing Bd. of Window Rock Consol. Sch.
Dist. No. 8, 221 Ariz. 104, 108, ¶ 7 (App. 2009) (holding that to obtain
appellate review, “the litigant must be an ‘aggrieved party’ with standing
to appeal” (citing ARCAP 1(d)); ARCAP 9(b) (providing for cross-appeals).

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                        ANDREWS v. ANDREWS
                          Opinion of the Court

generally depends on whether the court conceives of such leave as an
alternative form of wages, or instead as a form of deferred compensation
for services performed.” Id. at 631, ¶ 15. In the former cases, the courts
view accrued leave as indeterminate, speculative future-wage-replacement,
so that leave used after the marriage is the employee spouse’s separate
property. Id. at ¶¶ 16–17.

¶15           Husband contends that because he can only use the accrued
vacation time after the date of service, it should be treated as separate
property, in the same way that we treated post-community disability
benefit payments as separate property in Helland, 236 Ariz. at 199–200, ¶ 10.
In Helland, the parties purchased a disability insurance policy during the
marriage using community funds. Id. at 199, ¶ 2. The husband later became
unable to work and began receiving disability payments. Id. We held that
the superior court properly classified the post-community payments as the
husband’s separate property. Id. at 199–201, ¶¶ 9–15. Significantly, we
reasoned that the disability policy was “not an annuity or other investment
with an expected rate of return, as disability benefits are paid only under
certain conditions and are contingent upon the insured’s ongoing
disability”—and so “the community did not acquire a right to future
disability benefits payments when it purchased the policy.” Id. at 200, ¶ 12.

¶16           Consistent with Helland, and also with Moore and Cardona, we
hold that the accrued vacation pay constituted community property if it
was reimbursable (making it a form of deferred compensation). But if the
vacation pay was not reimbursable (making it merely a form of replacement
wages that could be used during or after the marriage), then it constituted
the employee spouse’s separate property. On this record, we cannot say
which classification applies because no evidence was presented regarding
whether the pay was reimbursable. We therefore must reverse and remand
so that the superior court may receive the evidence necessary to permit it
to classify the accumulated vacation pay, and to equitably divide it if
appropriate.

III.   THE SUPERIOR COURT ABUSED ITS DISCRETION BY DENYING
       HUSBAND’S REIMBURSEMENT CLAIM AS TO LOAN
       PAYMENTS HE MADE ON THE MARITAL RESIDENCE.

¶17             Throughout the litigation, Husband paid the mortgages,
utilities, cable, and lawn service for the marital residence; the mortgage on
the community’s rental property; and the minimum payments on
unspecified “community debts” as ordered by the court. The court denied
Husband’s request to be reimbursed for these payments because it

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                         ANDREWS v. ANDREWS
                           Opinion of the Court

concluded that he failed to disclose credible evidence to support his claim.
Husband contends that this was error based on Wife’s admissions.

¶18           The superior court has broad discretion in apportioning
community property and debts to achieve an equitable division, and we
will not disturb its allocation absent an abuse of discretion. See Boncoskey v.
Boncoskey, 216 Ariz. 448, 451, ¶ 13 (App. 2007). We consider the evidence in
the light most favorable to upholding the superior court’s ruling and will
affirm that ruling if the evidence reasonably supports it. Id.

¶19            When a divorcing spouse pays community obligations after a
petition for dissolution is filed, the matrimonial presumption of a gift does
not apply. Bobrow v. Bobrow, 241 Ariz. 592, 594, ¶ 1 (App. 2017). “A spouse
who voluntarily services community debt and maintains community assets
with separate property should not be penalized when a mutual agreement
cannot be reached. When such payments are made, they must be accounted
for in an equitable property distribution.” Id. at 596, ¶ 19 (footnote omitted).
Husband had the burden of proving the amount of his reimbursement
claim. See Troutman v. Valley Nat’l Bank of Ariz., 170 Ariz. 513, 517 (App.
1992) (“The party who asserts a fact has the burden to establish that fact.”).

¶20         Here, Husband paid community obligations pursuant to
temporary orders that expressly noted he might be entitled to “equalization
upon entry of the final decree as a result of his interim payment[s].” But
though Husband offered an exhibit summarizing the expenses he claimed
to have paid, he did not disclose the statements, bills, or other
documentation upon which the summary was based, so the court excluded
the summary. Husband does not challenge the exclusion of the summary.

¶21          Wife testified, however, that Husband had been making loan
payments on the marital residence, and had been paying at least some of
the other expenses on the residences:

       Q. You do agree that he’s been paying the first and second
       mortgage on the Barkley residence?

       A. As ordered by the Court, yes.

       Q. As well as the SRP bill on the mortgage--Barkley--
       residence?

       A. Yes.

       Q. And the Mesa utility bills?

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                         ANDREWS v. ANDREWS
                           Opinion of the Court

       A. that was all part of the community –-

       Q. Okay.

       A. -- debt that he was ordered to pay as part of the spousal
       maintenance, yes.

Wife further testified that though she had no knowledge regarding whether
Husband had missed any payments, she had received no foreclosure
notices and the utilities had not been shut off. She also identified specific—
albeit varying—loan-payment amounts for the marital residence in the two
affidavits of financial information she filed in the case. By contrast, she
provided only estimates for the other expenses Husband allegedly paid.

¶22           On this record, we conclude that Husband failed to meet his
burden of proof to show the amounts he paid on the non-mortgage
expenses and the rental-residence mortgage. But in view of Wife’s
testimony and affidavit statements regarding the marital-residence
mortgages, we hold that a preponderance of the evidence established that
Husband made payments somewhere within the range of the amounts
identified by Wife. We hold that the superior court abused its discretion by
disregarding that evidence. We therefore reverse and remand so that the
court may consider Husband’s reimbursement claim regarding the marital-
residence mortgage payments only.

                               CONCLUSION

¶23           We affirm the award of spousal maintenance. We reverse and
remand with respect to the superior court’s classification of the
accumulated vacation pay and with respect to the court’s failure to consider
evidence that Husband made loan payments on the marital residence. In
exercise of our discretion, we deny the parties’ competing requests for
attorney’s fees and costs on appeal.

                           AMY M. WOOD • Clerk of the Court
                           FILED: AA

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