Court Opinion

ID: 4696433
Source: CourtListenerOpinion
Date Created: 2021-06-17 16:02:18.832937+00
Date Added: 2024-06-11T08:05:40.614172
License: Public Domain

NOTICE: NOT FOR OFFICIAL PUBLICATION.
 UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
                 AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

                                    IN THE
             ARIZONA COURT OF APPEALS
                                DIVISION ONE

                              In re the Matter of:

                JORGE L. GONZALEZ, Petitioner/Appellant,

                                        v.

               PAULINA GONZALEZ, Respondent/Appellee.

                           No. 1 CA-CV 20-0533 FC
                                FILED 6-17-2021

           Appeal from the Superior Court in Maricopa County
                          No. FC 2018-000125
                  The Honorable Mark H. Brain, Judge

      AFFIRMED IN PART, REVERSED IN PART, REMANDED

                                   COUNSEL

Davis Miles McGuire Gardner PLLC, Tempe
By Spencer T. Schiefer
Counsel for Petitioner/Appellant
                       GONZALEZ v. GONZALEZ
                         Decision of the Court

                      MEMORANDUM DECISION

Judge Jennifer B. Campbell delivered the decision of the Court, in which
Presiding Judge D. Steven Williams and Judge James B. Morse Jr. joined.

C A M P B E L L, Judge:

¶1            Jorge Gonzalez (“Husband”) appeals the portions of a decree
of dissolution of marriage (“Decree”) that pertain to the distribution of
property and award of retroactive child support. We affirm in part, reverse
in part, and remand.

                             BACKGROUND

¶2            Husband and Wife married in 1996 and had three children. In
January 2018, Husband petitioned to dissolve the marriage. As relevant to
this appeal, the couple acquired three pieces of real property during the
marriage, the marital home on Amber Lane in Gilbert (“Amber Lane”); a
house on Betsy Court in Gilbert (“Betsy Court”); and a house Wife used to
run a daycare on Alma School Road in Mesa (“Alma School”). Also relevant
here, Wife signed a disclaimer deed to Betsy Court and Alma School. The
couple also owned numerous vehicles, including a 2002 Jeep Wrangler
(“2002 Jeep”) and 2006 Lincoln Navigator (“Navigator”).

¶3           After a two-day dissolution trial, the superior court entered
the Decree dissolving the parties’ marriage. The court ordered child
support, determined legal decision-making and parenting time for the
remaining minor child, and divided the community assets and liabilities.

¶4             Shortly after entry, Husband filed a motion to alter or amend
judgment (“Motion to Amend”). The superior court issued a minute entry
explaining that “[it] considered the matters raised in that motion at the
conclusion of trial and did not find that the evidence supported additional
awards.” The court denied Husband’s motion. Husband timely appeals.
Wife has not filed an answering brief, but in our discretion we decline to
treat it as a confession of error. See Nydam v. Crawford, 181 Ariz. 101, 101
(App. 1994).

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                        GONZALEZ v. GONZALEZ
                          Decision of the Court

                               DISCUSSION

¶5            Husband seeks review of both the superior court’s order
regarding child support and the division of community assets. “We will not
disturb [the superior] court’s decision on the amount of child support . . .
absent an abuse of discretion.” In re Marriage of Robinson, 201 Ariz. 328, 331,
¶ 5 (App. 2001). We review de novo the legal question of whether property
should be classified as community or separate. Bell-Kilbourn v. Bell-Kilbourn,
216 Ariz. 521, 523, ¶ 4 (App. 2007). We view the record on appeal in the
light most favorable to upholding the superior court’s decision. Cooper v.
Cooper, 130 Ariz. 257, 260 (1981).

I.     Child Support Judgment

¶6            Husband argues the superior court erred by deviating from
the Arizona Child Support Guidelines when awarding a retroactive child
support judgment. See A.R.S. § 25-320 app. (2018) (“Guidelines”). The court
must award the amount of child support resulting from the application of
the Guidelines unless the result “would be inappropriate or unjust in a
particular case.” Guidelines § 3. If deviating from the Guidelines, the court
must make specific written findings to support its decision. Guidelines §
20(A)(3).

¶7            When the dissolution proceeding began, the couple’s children
were 18, 17 and 15. The middle child turned 18 in September 2018 but the
youngest was still a minor at the time of trial. The superior court ordered
Husband to pay monthly child support and awarded Wife a judgment of
$20,306 “for appropriate past [child] support from the date of filing of the
current petition until today.” The retroactive child support order covered
28 months—from the date of filing, January 2018, until the court entered the
Decree in April 2020.1

¶8            The superior court included a completed Child Support
Worksheet reflecting a support obligation for one child of $585 per month.
The total for 28 months of support for one child at $585 per month would
be $16,380—$3,926 less than the court’s order. However, the court also
found that the middle child did not graduate from high school until May
2019 and adopted both Child Support Worksheets submitted by Wife with
her written closing argument. The court may require a parent to pay child
support through the end of the school year during which the child turns 18

1     As of the trial, Husband had paid no child support and was therefore
granted no credit.

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                         GONZALEZ v. GONZALEZ
                           Decision of the Court

years old. A.R.S. § 25-501(A); cf. State v. Huskie, 202 Ariz. 283, 286, ¶ 13 (App.
2002) (finding 18 year-old child emancipated on date of graduation from
high school).

¶9             The superior court applied the Guidelines which resulted in
Husband owing $816 per month for two children for 17 months ($13,872),
plus $585 per month for one child for 11 months ($6,435). This brings the
total retroactive support obligation to $20,307. Although the court failed to
fully explain its support order, it did not deviate from the Guidelines.
Because the court’s clerical error is de minimis, amounting to $1 in
Husband’s favor, we affirm the court’s retroactive support order against
Husband.

II.    Division of Property

¶10            We view the record in the light most favorable to upholding
the superior court’s classification of property as community or separate.
Cooper, 130 Ariz. at 260. “[W]e will not alter the superior court’s community
property distribution absent an abuse of that court’s broad discretion to
apportion the community property.” Saba v. Khoury, ___ Ariz. ___, ___, ¶ 5,
481 P.3d 1167, 1170 (App. 2021); see also Fuentes v. Fuentes, 209 Ariz. 51, 56,
¶ 23 (App. 2004) (“An abuse of discretion exists when the trial court
commits an error of law in the process of exercising its discretion.”); Little
v. Little, 193 Ariz. 518, 520, ¶ 5 (1999) (citation omitted) (“An abuse of
discretion exists when the record, viewed in the light most favorable to
upholding the trial court’s decision, is ‘devoid of competent evidence to
support’ the decision.”). We will not reweigh conflicting evidence on
appeal. O’Hair v. O’Hair, 109 Ariz. 236, 240 (1973).

       A.     Commingled Funds

¶11            Husband argues the superior court erred by granting Wife
equitable liens for half of the value of both the Betsy Court and Alma School
properties, given that she had executed disclaimer deeds on both
properties. Property acquired during marriage is presumed to be
community property. A.R.S. § 25-211(A); see also Brebaugh v. Deane, 211 Ariz.
95, 97–98, ¶ 6 (App. 2005). However, this presumption can be rebutted with
a signed disclaimer deed. See Bender v. Bender, 123 Ariz. 90, 93 (App. 1979).
A disclaimer deed is “a binding contract that must be enforced in the
absence of fraud or mistake.” Bell-Kilbourn, 216 Ariz. at 523, ¶ 7.

¶12            Although Wife challenged the validity of the disclaimer deeds
at trial, she did not allege fraud or mistake. The superior court found that

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                       GONZALEZ v. GONZALEZ
                         Decision of the Court

the Betsy Court and Alma School properties were Husband’s separate
property. See id. at 524, ¶ 11.

¶13           In granting equitable liens to Wife, the court also found that
both properties were financed solely with community funds. At trial, both
parties acknowledged that all home loan payments on Betsy Court were
paid from the couple’s joint bank accounts. The record shows that Wife’s
business income and client payments, Husband’s paychecks, and the rents
generated by Betsy Court were deposited in the joint accounts. Husband
testified that he and Wife were “commingl[ing] money” in their joint
accounts. Wife also testified that all the home loan payments and repairs on
Alma School were paid for with community funds.

¶14           Husband argues the Betsy Court rents were used to make the
loan payments due on that property. He argues that because Betsy Court
was his separate property, the rents it generated likewise were his separate
property. The superior court found, however, that Husband commingled
the rents by depositing them into the couple’s joint accounts. “Where both
community property and separate property are commingled in a [f]und so
that the separate property loses its identity, the presumption is tha[t] the
whole fund is community.” Guthrie v. Guthrie, 73 Ariz. 423, 426 (1952). If
home loan payments are made from commingled funds, “there is a
presumption that community funds were used.” Drahos v. Rens, 149 Ariz.
248, 251 (App. 1985).

¶15            Husband argues the superior court erred by not finding he
adequately traced the funds by showing that Betsy Court rents deposited
into the joint bank accounts were linked to loan payments made from those
accounts. But once the rents were deposited into the joint accounts, the
commingling occurred. See Guthrie, 73 Ariz. at 426. The burden was on
Husband to trace the funds through the account. Husband did not do an
adequate job of tracing his separate fund deposits. We agree with the court,
the rents from Betsy Court did not retain their separate character and
became community funds.

      B.     Valuation Analysis

¶16           Husband argues the superior court erred in calculating the
value of the community liens against the Betsy Court and Alma School
properties. In Arizona, using community funds to benefit separate property
creates a community interest in that property, which may be vindicated
through an equitable lien. Lawson v. Ridgeway, 72 Ariz. 253, 261–62 (1951).
“The existence and the value of an equitable lien present mixed questions

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                        GONZALEZ v. GONZALEZ
                          Decision of the Court

of fact and law.” Valento v. Valento, 225 Ariz. 477, 481, ¶ 11 (App. 2010). We
will not set aside the court’s factual findings unless clearly erroneous. Id.;
see also Kocher v. Dep’t of Revenue, 206 Ariz. 480, 482, ¶ 9 (App. 2003) (“A
finding of fact is not clearly erroneous if substantial evidence supports it,
even if substantial conflicting evidence exists.”). However, “we draw our
own legal conclusions from the facts found or implied by the family court.”
Valento, 225 Ariz. at 481, ¶ 11.

¶17           An equitable lien on real property is calculated by applying a
value-at-dissolution formula. See Drahos, 149 Ariz. at 250. If the property
increased in value during the marriage, the Drahos/Barnett formula is used
to compensate the community for the increase in value attributable to the
community’s contribution. See Barnett v. Jedynak, 219 Ariz. 550, 555, ¶ 21
(App. 2009); see also Saba, 481 P.3d at 1170, ¶ 6. (explaining that absent fraud
or mistake, disclaimer deeds must be enforced). The Drahos/Barnett formula
is C + (C/B x A), “where C is the total of any community contributions to
reduce principal; B is the purchase price; and A is the amount the property
appreciated during the marriage.” Saba, 481 P.3d at 1171, ¶ 13.

¶18            The formula the superior court used resembles that applied
in Femiano v. Maust, 248 Ariz. 613, 618, ¶ 23 (App. 2020). After Femiano, this
issue was reevaluated and in Saba, this court determined that the
Drahos/Barnett approach was the preferable way to determine an equitable
lien on real property. Saba, 481 P.3d at 1172, ¶ 17. We agree. For that reason,
we vacate the superior court’s finding and direct it to apply the
Drahos/Barnett formula to determine the community lien on Betsy Court. In
determining the lien, the court should consider whether any post-petition
loan payments on Betsy Court were made from Husband’s separate
accounts.

¶19          The superior court also granted the community a lien on the
Alma School property, which was sold before the petition for dissolution
was filed. When the property was sold, the proceeds of the sale, $180,077.84,
were deposited into a joint account created solely to hold the sale proceeds.
Since the funds were not commingled, they remained Husband’s sole and
separate property. As noted above, the court should have applied the
Drahos/Barnett formula to determine the community interest in the
proceeds. We vacate the superior court’s finding and direct it to apply the
Drahos/Barnett formula to determine the community lien on the Alma
School property proceeds.

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                        GONZALEZ v. GONZALEZ
                          Decision of the Court

       C.     Amber Lane Property

              1.     Repairs Reimbursement

¶20           Husband argues the superior court erred by failing to
adjudicate his claim for the reimbursement of $4,583.53 from Wife for
repairs made to prepare Amber Lane for sale. According to Husband, he
made the repairs at the direction of the real estate agent appointed as a
special commissioner for the sale of the couple’s marital home. Husband
raised this argument both during trial and in his Motion to Amend. See
Ariz. R. Fam. L. P. 83. The court declined to award Husband an offset for
repairs. In the Decree, the court stated that the “allocation of the real and
personal property, when considered with the division of debt, is fair and
equitable under the circumstances and that no further adjustments are
necessary.” As stated above, we will not alter the court’s distribution of
community property unless it abused its broad discretion. Saba, 481 P.3d at
1170, ¶ 5. While the court has discretion to make such equitable offsets, it is
not required to do so. We affirm.

              2.     Builder Settlement

¶21           Husband argues the superior court erred by failing to
adjudicate his claim for half of a $19,000 construction settlement that Wife
retained. Husband raised this claim both at trial and in the Motion to
Amend, and the court declined to award an offset for the alleged settlement.

¶22            “The [superior] court has an obligation to equitably divide
clearly identified community property.” Nold v. Nold, 232 Ariz. 270, 274,
¶ 20 (App. 2013). The only evidence to support the payment of the
construction settlement, however, is Husband’s testimony at trial and his
reference to a settlement statement that was not admitted into evidence.
Further, in the Motion to Amend, Husband claimed the settlement was
$13,000. The court explained that it “considered the matters raised in [the
Motion to Amend] at the conclusion of trial and did not find that the
evidence supported additional awards.” We assume the court made all
findings necessary to support its decision. See Mathews ex rel. Mathews v. Life
Care Ctrs. of Am., 217 Ariz. 606, 611, ¶ 21 (App. 2008). Husband’s claim is
not supported by the record. We affirm.

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                         GONZALEZ v. GONZALEZ
                           Decision of the Court

III.   Vehicles

       A.     Lincoln Navigator Value

¶23           Husband next argues the superior court erred in ascribing a
value of $2,500 to the Navigator. As stated above, we review the superior
court’s equitable distribution of community property for an abuse of
discretion. Boncoskey v. Boncoskey, 216 Ariz. 448, 451, ¶ 13 (App. 2007). Here,
Wife testified at trial that she sold the Navigator for $3,000 and agreed that
she owed Husband $1,500 for his share of the proceeds. Given Wife’s
concession, we vacate that portion of the decree and direct the court on
remand to award Husband one half of the $3,000 Wife received for the
vehicle.

       B.     2002 Jeep Insurance Proceeds

¶24          Finally, Husband argues the superior court erred by
awarding Wife one half of the insurance proceeds he received when their
2002 Jeep was totaled.2 Husband purchased the 2002 Jeep for $13,250.
Husband and Wife both agree that Husband gave the 2002 Jeep to their
adult daughter, although it remained titled in Husband’s name. After the
vehicle was totaled, Husband received an insurance settlement for
$9,931.20, which he gave to the parties’ daughter.

¶25            At trial, Wife stated she wanted nothing from the insurance
payment related to the totaled 2002 Jeep. Rather, she opined it would be
equitable to award Husband the 2002 Jeep and her the 2011 Escalade, which
she claimed was worth $9,000. The superior court awarded Wife the
Escalade as she requested, valuing it at $10,000. In doing so, the court
necessarily needed to effectuate the remainder of the calculation to arrive
at what she determined would be equitable. Wife waived her interest in the
2002 Jeep and, by extension, the insurance proceeds paid to Husband when
it was totaled. The court erred by awarding Wife half of the proceeds. We
vacate that portion of the decree and direct the court on remand to address
this division in accordance with Wife’s concession during her testimony at
trial.

IV.    Attorney’s Fees

¶26           Husband requests attorney’s fees and costs on appeal under
A.R.S. § 25-324 and ARCAP 21(a). In the exercise of our discretion, we deny

2     The superior court mistakenly referred to the totaled Jeep as a 2006
Jeep Wrangler.

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                      GONZALEZ v. GONZALEZ
                        Decision of the Court

Husband’s request for attorney’s fees. Husband is entitled to his costs on
appeal upon compliance with ARCAP 21(a).

                              CONCLUSION

¶27          For these reasons, we affirm in part, reverse in part, and
remand to the superior court for proceedings consistent with this decision.

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

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