Court Opinion

ID: 2689320
Source: CourtListenerOpinion
Date Created: 2014-08-01 17:00:59.810001+00
Date Added: 2024-06-11T13:14:00.115283
License: Public Domain

Notice: This opinion is subject to correction before publication in the P ACIFIC R EPORTER .
      Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,
      303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, e-mail
      corrections@appellate.courts.state.ak.us.

               THE SUPREME COURT OF THE STATE OF ALASKA

MATTHEW RICHTER,                               )
                                               )        Supreme Court No. S-15088
                      Appellant,               )
                                               )        Superior Court No. 3PA-11-02920 CI
              v.                               )
                                               )        OPINION
SHELLEY RICHTER,                               )
                                               )        No. 6931 - August 1, 2014
                      Appellee.                )
                                               )

              Appeal from the Superior Court of the State of Alaska, Third
              Judicial District, Palmer, Vanessa White, Judge.

              Appearances: Richard W. Postma, Jr. and Mitchell K. Wyatt,
              Law Offices of Mitchell K. Wyatt, Anchorage, for Appellant.
              Elizabeth-Ann Neufeld Smith, Law Offices of Kenneth
              Goldman, PC, Palmer, for Appellee.

              Before: Fabe, Chief Justice, Winfree, Stowers, Maassen, and
              Bolger, Justices.

              MAASSEN, Justice.

I.    INTRODUCTION
              The superior court granted a divorce to Shelley and Matthew Richter and
equitably divided their marital property. Matthew appeals, challenging the court’s
jurisdiction and its finding that a loan from Matthew’s mother was marital debt. We
affirm.
II.    FACTS AND PROCEEDINGS
              Shelley Richter (now Sailer) and Matthew Richter married in California in
January 2010. They separated in October 2011, and Shelley filed for divorce. At the
three-day divorce trial in December 2012, Matthew argued that the superior court lacked
jurisdiction over him because he is a resident of Idaho. He contended that he had not
resided in Alaska for at least six consecutive months while in a marital relationship with
Shelley, as is required by Alaska law before the court can acquire personal jurisdiction
over the parties in a divorce action.1
              Matthew and Shelley are both helicopter pilots, and their work requires
frequent travel. According to Matthew, he moved to Alaska five or six years before trial
but “was only there seasonally” until he and Shelley got married, when he began living
in Alaska year-round. At trial he identified Idaho as his residence, but he also testified
that he had had an Alaska driver’s license for about three years, that he applied twice for
an Alaska Permanent Fund Dividend but never qualified, and that he used an Alaska
address for his 2010 federal income tax return. He testified that because he and Shelley
both traveled frequently, there was no continuous six-month period of time when they
lived together in Alaska during their marriage.
              Shelley testified that Matthew rented out his house in Idaho and brought
most of his belongings to Alaska shortly after they got married, and that they bought a
condo together in Anchorage in April 2010. She testified that Matthew told her in March
2011 that he wanted to move back to Idaho, but he did not actually leave until October
2011, when they agreed to separate.

       1
              See AS 09.05.015(a)(12).

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             After hearing this testimony, the superior court concluded that it had
personal jurisdiction over Matthew because “[h]e was a resident [of Alaska] from
January of 2010 until at least September of 2011 in a marital relationship and he resided
in this state consecutively during that time.”
             Other issues at trial involved the parties’ marital property and debts. Their
main disagreement concerned a $100,000 loan from Matthew’s mother, Patricia Richter.
Shelley entered the marriage with over $100,000 in debt for student loans, bearing a
variable interest rate that could go as high as 16 percent. According to Matthew, his
mother offered to help Shelley with refinancing the student loan debt and co-signing a
new loan at a lower interest rate; he testified that he had no involvement in that
transaction. Shelley testified, on the other hand, that Matthew’s mother “made $100,000
available to [her and Matthew] to use as investment,” which they first considered
investing in commercial properties in Girdwood.          Shelley testified that “[t]hose
properties didn’t work out[,] and as we sat there empty handed, not sure what our next
move was, we started analyzing our finances and looking at where our liabilities were.”
Concluding that reducing Shelley’s student loan debt was their wisest financial move,
they jointly decided to use the $100,000 from Matthew’s mother to pay off that debt.
Whatever the impetus, Patricia Richter took out a loan from a family trust at about 2.25%
interest and wired the money to Matthew and Shelley’s joint bank account, from which
Shelley paid off her student loans. Repayments to Patricia Richter for the loan were also
made from the couple’s joint account.
             Despite testimony by both Matthew and his mother that the loan was a non-
marital transaction solely between Patricia Richter and Shelley, the court credited
Shelley’s testimony that the parties had incurred the loan as a couple to improve their

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overall financial situation and were jointly liable for its repayment. Finding it to be
marital debt, the court divided it equally between Shelley and Matthew.
              Matthew timely2 appealed the superior court’s rulings on jurisdiction and
the marital nature of the $100,000 debt. He also contends that he was denied due process
because he went to trial without knowing that it might result in an equitable property
division.
II.    STANDARDS OF REVIEW
              We review de novo issues of law, including whether the superior court has
subject matter jurisdiction 3 and whether it has personal jurisdiction.4
              “There are three basic steps in the equitable division of marital assets: (1)
deciding what specific property is available for distribution, (2) finding the value of the

       2
              Shelley argues in her brief that Matthew’s appeal is not timely as to the
jurisdiction issue because the appeal was not filed within 30 days of the court’s
judgment. The final decree and written findings were distributed on January 16, 2013.
Matthew had filed motions for reconsideration and for a new trial a day earlier, based on
the court’s oral decision made on the record on January 2. Matthew’s motions
terminated the running of the time for appeal. See Alaska R. App. P. 204(a)(3). Shelley
argues that the motions did not affect the time for appealing the jurisdiction issue because
they did not address it. But Rule 204(a)(3) does not extend the time for appealing only
those issues that are addressed in post-trial motions; such a rule would needlessly foster
piecemeal appeals. Matthew’s post-trial motions were denied on February 26, and he
timely filed this appeal on March 13.
       3
              Hawkins v. Attatayuk, 322 P.3d 891, 894 (Alaska 2014).
       4
             Vanvelzor v. Vanvelzor, 219 P.3d 184, 187 (Alaska 2009) (citing S.B. v.
State, Dep’t of Health & Soc. Servs., Div. of Family & Youth Servs., 61 P.3d 6, 10
(Alaska 2002)).

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property, and (3) dividing the property equitably.”5 This appeal concerns only the first
step.
              “In the first step, ‘[t]he characterization of property as separate or marital
may involve both legal and factual questions.’ ”6 We review the “[u]nderlying factual
findings as to the parties’ intent, actions, and contributions to the marital estate” for clear
error.7 “A finding of fact is clearly erroneous if, upon review of the entire record, we are
left with a firm and definite conviction that a mistake has been made.”8 “[W]hether the
trial court applied the correct legal rule in exercising its discretion is a question of law
that we review de novo using our independent judgment.”9
IV.     DISCUSSION
        A.    The Superior Court Had Jurisdiction Over This Divorce Case.
              1.     The superior court had subject matter jurisdiction.
              Matthew claims that the superior court did not have subject matter
jurisdiction over the “personal claims in the divorce.” He is incorrect. “Subject matter
jurisdiction is ‘the legal authority of a court to hear and decide a particular type of
case.’ ”10 “[W]here the legislature has authorized a court to enter judgment in a

        5
              Beals v. Beals, 303 P.3d 453, 458 (Alaska 2013).
        6
               Id. at 459 (quoting Odom v. Odom, 141 P.3d 324, 330 (Alaska 2006))
(alteration in original).
        7
              Id.

        8
              Stanhope v. Stanhope, 306 P.3d 1282, 1287 (Alaska 2013).

        9

              Id. at 1286 (internal quotation marks omitted).
        10
           Nw. Med. Imaging, Inc. v. State, Dep’t of Revenue, 151 P.3d 434, 438

(Alaska 2006) (quoting ERWIN CHEMERINSKY , FEDERAL JURISDICTION 257 (3d ed.

                                                                   (continued...)

                                             -5-                                         6931

particular class of cases, the court properly has subject matter jurisdiction.”11 Alaska
Statute 25.24.050 sets out the grounds for divorce, and AS 25.24.160(a) describes what
the superior court may include in its judgment in an action for divorce. These statutes
clearly grant the superior court the authority to enter judgment in a divorce action,
thereby giving the court subject matter jurisdiction.12
                 2.     The superior court had personal jurisdiction.
                 Alaska Statute 09.05.015(a)(12) grants a court personal jurisdiction over
a nonresident party for the personal claims in a divorce action if:
                 (A) the parties resided in this state in a marital relationship
                 for not less than six consecutive months within the six years
                 preceding the commencement of the action; (B) the party
                 asserting the personal claim has continued to reside in this
                 state; and (C) the nonresident party receives notice as
                 required by law.
Here, in response to the court’s questioning, Matthew confirmed that he lived in Alaska
“more or less continuously” for the first eight months of his marriage to Shelley. He
moved most of his belongings to Anchorage, obtained an Alaska driver’s license,
identified his residence as Alaska for federal tax purposes, and applied for the Permanent
Fund Dividend. He and Shelley together bought an Anchorage condo, which Shelley
testified was their “home base.” Although Matthew still owned his house in Idaho, he
rented it out during the marriage. Considering all this evidence, the court did not clearly

       10
            (...continued)
1999)).
       11
                 Id. (citing Rodriguez v. Rodriguez, 908 P.2d 1007, 1011 (Alaska 1995)).
       12
                 Cf. Rodriguez, 908 P.2d at 1011.

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err in finding that Matthew resided in Alaska for more than six consecutive months of
the marital relationship.
              Matthew reads the statutory phrase “in a marital relationship for not less
than six consecutive months” as requiring a couple to have lived under the same roof for
that amount of time, a requirement he fails to meet because of his and Shelley’s constant
travel. But his reading of the statute is unreasonable. If it were accepted, an Alaska
court would lack jurisdiction over long-time Alaska couples simply because one spouse
travels regularly to Juneau or the North Slope, or because their employment requires that
they maintain separate residences and see each other on weekends. The statute simply
requires six consecutive months of Alaska residency while in a marital relationship; it
does not require that the married couple share a home, let alone that they spend every day
together for the required six months. Here, once the superior court found that Matthew
had resided in Alaska for six consecutive months during his marital relationship with
Shelley, it properly exercised jurisdiction under AS 09.05.015(a)(12).
       B.     The Superior Court Properly Classified The Loan As Marital Debt.
              Matthew argues that the $100,000 debt owed to his mother was Shelley’s
separate obligation and that the court erred by classifying it as marital and allocating it
between them.13
              In a judgment for divorce, the court may provide “for the division between
the parties of their property, . . . whether joint or separate, acquired only during marriage,

       13
               Matthew cites to AS 25.15.050, which provides that “neither spouse is
liable for the . . . separate debts of the other,” and to AS 25.15.100, which allows a
married person to make contracts and incur liabilities which can then be enforced “to the
same extent and in the same manner as if the person were unmarried.” Neither of these
statutes is relevant unless the loan is Shelley’s separate debt; they do not help determine
whether the debt is separate or marital in the first instance.

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in a just manner.”14 Debt incurred during marriage is presumptively marital; the party
claiming otherwise must show that the parties intended it to be separate.15 “Separate
property includes property acquired by one spouse before marriage, property acquired
by gift, and property acquired by inheritance.”16 “Whether an initially nonmarital debt
transmutes into a marital liability is a question of intent and acceptance.”17
             Neither party disputes that Shelley’s student loan debt was separate debt that
she brought to the marriage. But it is also undisputed that this debt was paid off during
the marriage: Matthew testified that he paid $13,500, expecting Shelley to make up for
it by making future mortgage payments and paying other household expenses; and the
remaining $100,000 was paid off with the loan from Matthew’s mother, Patricia Richter.

       14
              AS 25.24.160(a)(4).
       15
             Stanhope v. Stanhope, 306 P.3d 1282, 1290 (Alaska 2013); Beals v. Beals,
303 P.3d 453, 460 (Alaska 2013) (“Generally, ‘all assets acquired by the parties during
their marriage are marital property’ except for gifts and inheritances.”)(quoting Johns v.
Johns, 945 P.2d 1222, 1225 (Alaska 1997)).
       16
             Bilbao v. Bilbao, 205 P.3d 311, 313-14 (Alaska 2009) (citing Schmitz v.
Schmitz, 88 P.3d 1116, 1127 (Alaska 2004)).
       17
              Ginn-Williams v. Williams, 143 P.3d 949, 956 (Alaska 2006). Matthew
claims that Ginn-Williams requires this court to conclude that the $100,000 debt was
separate. Ginn-Williams held that where property transmuted to marital property, the
debt associated with that property must also transmute. This holding does not apply here
because no property transmuted. The loan from Patricia Richter was incurred during the
marriage and was therefore presumptively marital debt.

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The loan from Patricia was acquired during the parties’ marriage and therefore became
presumptively marital debt.18 It is Matthew’s burden to prove it is separate.19
              The evidence on this issue at trial was conflicting. Matthew denied any
involvement with Shelley’s student loans “other than paying down the $13,500.” He
testified that he had no authority to “negotiate or compromise this debt between Shelley
and [his] mother.” Patricia supported her son’s view of the transaction, testifying that she
“sent $100,000 to [Shelley’s] bank account in the name of Shelley Richter in June 2011,”
that Matthew did not sign anything related to the loan, and that Matthew was not
responsible for the loan in any way — the loan “was only intended to help Shelley.”
              But the superior court did not find the testimony of Matthew and Patricia
credible on this issue. The court credited instead Shelley’s testimony that Patricia had
offered the couple $100,000 to invest and that after considering and rejecting the idea of
buying commercial real estate, they together decided it would make better financial sense
to pay off Shelley’s high-interest student loan debt. Shelley maintained that she would
not have asked Patricia for help but that Matthew wanted to use the money in this way.
The money loaned by Patricia was transferred to the couple’s joint bank account, and
repayments to Patricia on the loan were made from the same joint account. Shelley
testified that the amount of the loan would be subtracted from Matthew’s inheritance if
Patricia died before it was paid off, indicating that she saw the loan as benefitting her son;
Patricia testified that she never would have loaned Shelley the money if she had known
about the couple’s marital difficulties, again indicating that benefit to Matthew was part
of Patricia’s calculus. The evidence also showed that Patricia only attempted to document

        18
             Stanhope, 306 P.3d at 1290; Beals, 303 P.3d at 460 (quoting Johns, 945
P.2d at 1225).
        19
               Id. See also Brandal v. Shangin, 36 P.3d 1188, 1192 (Alaska 2001).

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the transaction — drawing up a promissory note between herself and Shelley alone —
after she learned that the couple had decided to separate; Shelley refused to sign the note.
Given the evidence on both sides of the issue and the great deference we give to a trial
court’s factual findings when they require “weighing the credibility of witnesses and
conflicting oral testimony,”20 we cannot say the superior court clearly erred when it found
that the parties intended the debt to be marital.21
              Matthew also argues the debt is nonmarital because Shelley incurred it
during a period of separation that led to divorce. As a general rule, “property acquired
after separation is properly excluded from the category of marital property.”22 Separation
occurs when a married couple ceases to function as a single economic unit, which requires
a fact-specific inquiry.23 Here, Patricia Richter loaned Shelley and Matthew the money
in June 2011. Matthew is correct that this transaction occurred after he proposed that the
parties separate, but the evidence showed that they did not actually do so until October
2011. The debt remains presumptively marital.
              Matthew makes a few other arguments challenging the superior court’s
findings, none of them meritorious. He argues first that the superior court improperly

       20
            Stanhope, 306 P.3d at 1287 (quoting Bigley v. Alaska Psychiatric Inst., 208
P.3d 168, 178 (Alaska 2009)).
       21
              Matthew separately argues that he was not a party to Shelley’s agreement
with Patricia and that “a third-party cannot be held liable on a debt for merely helping
a debtor make a payment.” But these arguments simply restate his central tenet — that
the debt to his mother was not incurred by the marital unit — an argument the superior
court rejected as a factual matter.
       22
            Ramsey v. Ramsey, 834 P.2d 807, 809 (Alaska 1992) (citing Schanck v.
Schanck, 717 P.2d 1, 3 (Alaska 1986)).
       23
               Hatten v. Hatten, 917 P.2d 667, 671 (Alaska 1996).

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relied on an unadmitted exhibit, Exhibit 23, in making its oral findings. But after
Matthew’s attorney pointed this out, the court acknowledged its mistake and stated,
“[T]he fact that [Exhibit] 23 is not part of the record doesn’t change my ruling. . . . I
found [Shelley’s] testimony to be highly credible on this point. I did not find Mr.
Richter’s testimony to be credible. I did not find his mother’s testimony to be credible
on this point.” The testimony on which the court relied was sufficient to support its
findings of fact.
              Finally, Matthew argues that the debt to his mother is unenforceable because
there was no consideration given for it except possibly a promise to Patricia that the
couple would have grandchildren, a promise Matthew contends was illusory. But
Matthew did not raise this issue before the superior court, and it is therefore waived.24
       C.     The Superior Court Did Not Violate Matthew’s Due Process Rights.
              Matthew claims that his due process rights were violated because he went
to trial believing that Shelley did not intend to ask the court for anything other than a
rescission of their relatively short marriage, and he was surprised when she sought an
equitable distribution of their marital property. He argues that “because (a) Shelley
alleged Matthew was a resident of Idaho and not Alaska [in her complaint]; (b) Matthew
agreed that he was an Idaho resident [in his answer]; and (c) Shelley never alleged any
set of facts that would invoke the long-arm statute for divorce, Matthew did not have
sufficient notice that Shelley would contradict her own pleadings and seek anything more
than a Rose v. Rose-type rescission of the marriage.”25 Matthew claims that with proper

        24
            Alaska State Emps. Ass’n/AFSCME Local 52, AFL-CIO v. State, 74 P.3d
881, 886 (Alaska 2003).
        25
               See Rose v. Rose, 755 P.2d 1121 (Alaska 1988). Whether to apply a Rose­
                                                                         (continued...)

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notice that a property division was contemplated, he would have presented additional
evidence proving that the $100,000 loan from his mother was Shelley’s separate debt.
              Matthew’s argument fails for a number of reasons. Most obviously, it is
unreasonable to read the complaint’s allegation that Matthew was then “a resident of
Victor, Idaho,” as an affirmative assertion that the superior court therefore lacked
jurisdiction over the parties’ divorce, particularly given that the complaint was captioned
“Complaint for Divorce” and asked the court to adjudicate “[c]ertain property rights and
obligations [that] have been acquired and certain debts and obligations [that have been]
incurred by the parties during the course of the marriage.” And Matthew was clearly on
notice that the $100,000 debt would be an issue at trial; he specifically addressed it both
in his answer (asserting that he would not agree to a divorce until Shelley had refinanced
the loan, which “is her loan, it has nothing to do with my mother and I”) and in his trial
brief (asserting that the student loans had been refinanced with the help of his mother but
that “Matthew did not co-sign the refinance”). Shelley’s trial brief listed the loan as a
joint obligation of the parties and asked on her property spreadsheet that it be split 50/50.
Matthew testified about the loan at trial, cross-examined Shelley on the subject, and
presented the supporting testimony of his mother. There is no basis in these facts to
conclude that Matthew lacked fair notice that responsibility for the loan was at issue or
that he lacked a fair opportunity to litigate it. His claim that he was denied due process
is without merit.

       25
        (...continued)
type rescission remedy rather than make an equitable distribution is left to the court’s
discretion. Id. at 1125 (“stating that the trial court may, without abusing its discretion”
treat the divorce as a rescission); see also Nicholson v. Wolfe, 974 P.2d 417, 421 (Alaska
1999) (“Since Rose, we never have held that it would be clearly unjust to adopt equitable
rather than rescission principles.”).

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V.   CONCLUSION
        We AFFIRM the judgment of the superior court.

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