Court Opinion

ID: 8483010
Source: CourtListenerOpinion
Date Created: 2022-11-10 17:01:27.467167+00
Date Added: 2024-06-11T16:49:43.369065
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  UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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 Marriage of:

         NADINE BEAUMONT, Petitioner/Appellant/Cross-Appellee,

                                         v.

         DAVID BEAUMONT, Respondent/Appellee/Cross-Appellant.

                            No. 1 CA-CV 21-0426 FC
                            No. 1 CA-CV 21-0642 FC
                                 (Consolidated)
                              FILED 11-10-2022

            Appeal from the Superior Court in Mohave County
                        No. L8015DO201907142
            The Honorable Kenneth Gregory, Judge Pro Tempore

    AFFIRMED IN PART; VACATED IN PART AND REMANDED

                                    COUNSEL

Silk Law Office, Lake Havasu City
By Melinda Silk
Counsel for Petitioner/Appellant/Cross-Appellee

Law Office of Heather C. Wellborn PC, Lake Havasu City
By Heather C. Wellborn, Alyssa N. Oubre
Counsel for Respondent/Appellee/Cross-Appellant
                       BEAUMONT v. BEAUMONT
                          Decision of the Court

                       MEMORANDUM DECISION

Judge James B. Morse Jr. delivered the decision of the Court, in which
Presiding Judge Jennifer M. Perkins and Judge Michael J. Brown joined.

M O R S E, Judge:

¶1            Nadine Beaumont ("Wife") and David Beaumont ("Husband")
challenge several rulings in the decree dissolving their marriage. We vacate
the finding that the stocks in a joint trust account are community property,
the spousal-maintenance award, the expert-witness-fee award, and the
child-support order. We remand for reconsideration of these issues but
affirm all other rulings.

             FACTS AND PROCEDURAL BACKGROUND

¶2           The parties married in 2003 in Pennsylvania and have one
minor child, born in 2004. Wife petitioned for dissolution of marriage in
2019 and the superior court held a two-day trial in 2020.

¶3            Before the marriage, Husband acquired two parcels of real
property in Pennsylvania that he later deeded to a community property
trust. There are oil and gas leases on these parcels that pay monthly
royalties in varying amounts. For the 17 months before the trial, the
royalties paid an average of $5,000 a month. The superior court concluded
that the Pennsylvania properties and the royalties they generated were
community property. Finding no competent evidence of their value, the
court ordered the parties to hold the parcels as tenants in common and
share equally in any royalties.

¶4            At the time of the trial, Wife was 60 years old. She requested
spousal maintenance in the form of half the royalties for life, but if her share
of the royalties was less than $3,500 in any given month, Wife asked for
Husband to make up the difference. Husband, on the other hand, opposed
any award of spousal maintenance. The superior court awarded Wife
spousal maintenance of $1,000 per month until May 2025, when she will be
65. The court also entered a current child support order and ordered
Husband to pay past child support.

¶5            The community owned three businesses: Wise Steward, Back
to Basics, and Complete Accounting and Tax, Inc. During the two-day trial,

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each party called an expert to testify to the value of the businesses. The
superior court accepted the conclusion of Wife's expert that only Wise
Steward had any value. The court found Wise Steward was worth $264,000
and awarded all three businesses and their assets and liabilities to Husband
with an equalization payment of $132,000 to Wife.

¶6            Wife asked to keep the marital home and pay Husband for his
share of the equity. Husband did not oppose this if Wife could refinance
the mortgage and remove his name from the debt, but the parties could not
agree on the appropriate valuation date for determining Husband's interest
in the equity. The court ordered the home sold and the equity divided
equally. Further, if the parties could not agree to a broker or sales price, the
court ordered them to use Husband's broker and list the home for "at least
$599,900."

¶7            During the marriage, Wife inherited stocks from her father. A
few years later, she transferred some of those stocks into a joint trust
account, while leaving others in trust accounts in her name only. The
parties disputed whether the stocks in the joint trust account were
community or separate property. The superior court found they were
community property because Wife gifted these stocks to the community.
Wife was awarded the joint trust account and ordered to pay Husband an
equalization payment of $151,585, which was 50% of the account value on
the date of service.

¶8           After the superior court made its rulings but before entry of
the final decree, Husband sought to hold Wife in contempt for not
complying with the order to sell the home. The court entered the final
decree and separately set an order to show cause hearing on the contempt
petition. Wife filed a timely notice of appeal. She also moved to stay
execution of the decree, which Husband opposed. Husband then cross-
appealed from the decree. We have jurisdiction under A.R.S. § 12-
2101(A)(1).

¶9           While the appeal and cross-appeal were pending, the parties
disputed the need for a supersedeas bond. Husband filed a second petition
for contempt relating to Wife's alleged transfer of funds from the joint trust
account. The court addressed all these issues at an evidentiary hearing on
September 16, 2021.

¶10          At the hearing, the parties agreed that rather than post a
supersedeas bond, Wife would refinance the mortgage on the marital home
into her name within 90 days. They agreed to hold the house as tenants in

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common until the appeal is resolved. Each party agreed to pay half the
mortgage for 90 days; after that, Wife was responsible for the mortgage
payments. Husband will be reimbursed for the mortgage payments he
made when he receives his share of the equity. After hearing from two real
estate brokers, the court found the fair market value of the marital home on
September 16, 2021, was $689,000, with a mortgage balance of $312,500. The
parties agreed to determine Husband's share of the equity based on these
figures, pending the outcome of the appeal. Neither party appealed from
this post-decree ruling.

                               DISCUSSION

I.     Stocks in the Joint Trust Account.

¶11           The stocks were Wife's separate property when she inherited
them. A.R.S. § 25-213(A). But separate property can be transmuted into
community property by agreement, gift, or commingling. In re Marriage of
Cupp, 152 Ariz. 161, 164 (App. 1986). The superior court found that Wife
intended to gift the stocks to the community when she transferred them
from her separate trust account to a joint trust account. Wife argues the
stocks are her separate property. The classification of property as separate
or community is a question of law we review de novo. Bell-Kilbourn v. Bell-
Kilbourn, 216 Ariz. 521, 523, ¶ 4 (App. 2007).

¶12           When separate funds are placed into a joint account, there is
no presumption that the owner of the funds intended to gift half of the
funds to the other spouse. Stevenson v. Stevenson, 132 Ariz. 44, 46 (1982)
(citing A.R.S. § 14-6103(A), now § 14-6211). Placing separate funds into a
joint account suggests, but does not conclusively prove, an intent to gift.
Grant v. Grant, 119 Ariz. 470, 472 (App. 1978); see also A.R.S. § 14-6211(A)
(noting funds in a joint account "belong[] to the parties in proportion to the
net contribution of each to the sums on deposit unless there is clear and
convincing evidence of a different intent" (emphasis added)).

¶13            The superior court found "it more likely than not" that Wife
intended to gift her separate property stocks to the community by
depositing them into a joint trust account. However, the deposit of separate
funds into a joint account does not indicate a gift absent clear and convincing
evidence of such an intent. Stevenson, 132 Ariz. at 46. The court did not
apply the clear-and-convincing legal standard for finding a gift. Ordinarily,
determining whether a spouse intended a gift is a question of fact subject to
a clearly erroneous standard of review. Bobrow v. Bobrow, 241 Ariz. 592,
595, ¶ 11 (App. 2017). But the court abuses its discretion when it misapplies

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the law or relies on incorrect legal standards. Hammett v. Hammett, 247 Ariz.
556, 559, ¶ 13 (App. 2019). Here, the court applied an incorrect legal
standard. As a result, we vacate the finding that the stocks are community
property and remand for reconsideration.

II.    Orders Regarding the Marital Home.

¶14             The decree ordered the parties to sell the marital home and
divide the net proceeds equally. If the parties could not agree on a broker
or listing price, the court ordered the home listed with Husband's broker
for "at least" $599,900. We review the allocation of community property for
an abuse of discretion. Bell-Kilbourn, 216 Ariz. at 523, ¶ 4.

¶15            Wife concedes the superior court had discretion to order the
sale of the home. She argues the court abused its discretion here because
Husband agreed she could have the home as long as he was paid his share
of the equity and taken off the mortgage. Contrary to Wife's assertion, the
parties did not reach an enforceable agreement. At the time of trial, Wife
had not yet refinanced the home; nor did she offer conclusive evidence that
she could do so. Based on this speculative evidence, and absent an
enforceable agreement, the court was within its discretion to order the
parties to sell the home and divide the proceeds equally.

¶16           Although Wife apparently refinanced the mortgage after the
decree, that was not the situation at the time of trial. We review the superior
court's ruling based on the record at the time of trial. See GM Dev. Corp. v.
Cmty. Am. Mortg. Corp., 165 Ariz. 1, 4 (App. 1990) (noting appellate court
review is "limited to the record before the trial court"). When the superior
court made its ruling, there was no evidence showing that Wife had
refinanced the home or demonstrating her ability to do so. Moreover, Wife
waived any argument related to refinancing by raising it for the first time
in her reply brief. See Johnson v. Provoyeur, 245 Ariz. 239, 243, ¶13 n.5 (App.
2018) (noting that issues first raised in a reply brief are generally considered
waived).

¶17            Wife also argues the superior court ignored the effect of
selling the marital home on the child. Any harm to the child from the sale
of the home was for the court to weigh against the parties' property
interests. See Dole v. Blair, 248 Ariz. 629, 633, ¶ 14 (App. 2020) (noting courts
may consider the children in deciding which party should be awarded a
piece of property, but "may not impinge on either party's property
interests"). We will not reweigh these considerations on appeal. Hurd v.
Hurd, 223 Ariz. 48, 52, ¶ 16 (App. 2009).

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¶18            The superior court's under advisement ruling ordered the
parties to list the home for $599,900. Wife contends the court improperly
changed that ruling when it added that the home should be listed for "at
least" $599,900 in the final decree. The addition of this language in the final
decree was not improper. It is reasonable to infer that the court added this
language so that the parties could benefit from any subsequent market
increase. Indeed, Husband provided two market analyses showing the
home's value had increased nearly $75,000 between September 2019 and
November 2020. Wife did not refute this evidence. The language is
equitable because the court ordered the parties to pay the mortgage using
funds in a community bank account so they will share equally in any
increase in value. Because there was no agreement for Wife to buy out
Husband's interest at a certain price, the court did not abuse its discretion
by ordering the home sold for at least $599,900.

¶19           The superior court was also within its discretion to order the
parties to use Husband's broker absent an agreement. Husband's broker
provided the only comparative market analysis. Wife did not provide an
alternative broker or method of selecting among competing brokers. We
find no abuse of discretion.

III.   Post-Decree Ruling on the Marital Home.

¶20          In post-decree proceedings, the parties reached several
agreements about the home. They agreed to hold title as tenants in common
pending appeal and in lieu of Wife posting a supersedeas bond. Consistent
with this agreement, Wife refinanced the mortgage into her name. The
superior court incorporated this agreement into a post-decree order. After
hearing from both parties' real estate brokers, the court found the home's
value was $689,000 on September 16, 2021.

¶21             Wife cannot rely on these post-decree events to argue that the
order to sell the home was an abuse of discretion. See supra ¶ 15. At the
time of trial, there was no such agreement, and Wife had not refinanced the
mortgage. And neither party appealed from the post-decree order finding
the home was worth $689,000 on September 16, 2021. The superior court
issued that order in response to post-decree agreements, which do not
impact the issues raised in this appeal. For this reason, we do not address
the "issue presented for review on consolidated appeal."

IV.    Business Valuation.

¶22          The superior court accepted the opinion of Wife's expert and
found that only one of the community businesses—Wise Steward—had any

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value. The court found that Wise Steward had a value of $264,000 as of
March 31, 2020. The court awarded Husband the three businesses and all
business bank accounts, assets, and liabilities; and awarded Wife an
equalization payment of $132,000.

¶23          The valuation of assets is a factual determination. See In re
Marriage of Molloy, 181 Ariz. 146, 150 (App. 1994). We will affirm the
superior court's determination if reasonable evidence supports it. Id. at 152.
The record supports the finding that Wife's expert provided a reasonable
valuation and sufficiently refuted the issues raised by the opposing expert.

¶24           On cross-appeal, Husband argues the superior court's
valuation improperly included a "bad debt" Back to Basics owed Wise
Steward. Husband's expert would deduct this "bad debt" from Wise
Steward's receivables, thereby lowering its value. According to Wife's
expert, this would not affect the overall valuation of both businesses. As
Wife's expert explained, if the "bad debt" was deducted from Wise
Steward's accounting, it would have to be added back to the accounting for
Back to Basics. The court was within its discretion to weigh these
competing expert opinions. See Hurd, 223 Ariz. at 52, ¶ 16 (noting that
appellate courts do not reweigh conflicting evidence).

¶25            Husband also argues that the court abused its discretion by
not ordering the business sold as he proposed. Because Husband cited no
authority or facts to support this argument, it is waived. See ARCAP
13(a)(7); In re Aubuchon, 233 Ariz. 62, 64-65, ¶ 6 (2013). Similarly, Wife
argues, without citations to the record, that the court did not address two
bank accounts related to Complete Accounting and Tax, Inc. This argument
is also waived. Id.

V.     Bank Accounts and the $10,000 Equalization Payment.

¶26           There were two community personal bank accounts at Wells
Fargo: a checking account and a money market account. The superior court
ordered the parties to close the checking account and equally divide the
$1,300 remaining on deposit. The funds in the money market account came
from the monthly oil and gas royalties. The court ordered the parties to
continue paying the mortgage from the money market account until they
sold the home or the funds were depleted.

¶27           There was also a BBVA account Husband opened in his name
after the date of service. The only bank statement related to this account
showed a balance of $28,500 as of October 2020. The court awarded the
BBVA account to Husband. To equalize the various bank accounts, the

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court ordered Husband to pay Wife $10,000, finding this amount was
equitable because Wife had exclusive use of the marital home during the
proceedings, and the mortgage was paid with community funds (the
royalties) during that time.

¶28           Wife argues the $10,000 equalization payment is inequitable;
conversely, Husband argues Wife was not entitled to any equalization
payment. We will affirm the allocation of community property absent an
abuse of discretion. Bell-Kilbourn, 216 Ariz. at 523, ¶ 4.

¶29          Since the date of service, both parties paid their personal
expenses from the community royalties. Husband also ran personal
expenses through the businesses. According to Wife, this resulted in
Husband spending more than his share of the community income during
the proceedings. Wife also argues that Husband kept all the business
revenue and did not pay any spousal maintenance or child support during
the proceedings.    In contrast, Husband argues Wife deserved no
equalization payment because she spent more than her share of the royalty
income.

¶30           Earnings paid to a spouse after service of the petition are that
spouse's separate property. See A.R.S. § 25-213(B) (property acquired after
service of a petition for dissolution is that party's separate property). The
evidence showed that the funds with BBVA were Husband's post-service
earnings.

¶31          Nonetheless, the businesses were community property, so
Wife may have been entitled to any profits the businesses generated in
excess of Husband's reasonable compensation. See Schickner v. Schickner,
237 Ariz. 194, 199, 201, ¶¶ 22, 30 (App. 2015). There was, however, no
evidence showing such additional profits. Thus, the record does not show
that Husband improperly retained any community business revenue above
his reasonable compensation.

¶32           Wife argues it is impossible to determine the business
revenues because Husband did not disclose all the relevant bank
statements. Yet Wife relied on her expert's business valuation opinion
despite his admissions that some statements were missing and not every
personal expense Husband ran through the business was calculated. Wife
cannot complain about these limitations on one hand but ignore them on
the other. We find this issue waived.

¶33           Husband contends Wife was not entitled to $10,000 because
his calculations show she spent more than he did from the community

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account. However, his calculations did not include any supporting
documentation. He also attributed the mortgage and some of the child's
expenses to Wife which skewed her spending. And Husband will receive
his share of the community funds that were spent on the mortgage when
he is paid his share of the equity.

¶34            On this record, we cannot find the allocation of the bank
accounts and $10,000 equalization payment was inequitable. When viewed
as a whole and in the light most favorable to upholding the decree, we find
$10,000 was reasonable. There is no evidence that Husband improperly
retained business revenues. And Wife did not prove exactly how much
more community funds Husband spent during the proceedings than she
spent. Therefore, Wife cannot fault the court for estimating an equitable
equalization payment based on the record presented. We affirm the
allocation of the community and business bank accounts and the equitable
equalization payment.

VI.    Spousal Maintenance.

¶35             The superior court awarded Wife $1,000 a month in spousal
maintenance from May 1, 2021, until she turns 65 in May 2025. Husband
argues that Wife was not entitled to any spousal maintenance. Wife
contends she was entitled to spousal maintenance from the start of the
proceedings in June 2019, and that the amount is insufficient. We review
an award of spousal maintenance for an abuse of discretion and will affirm
if there is any reasonable evidence to support the award. Helland v. Helland,
236 Ariz. 197, 202, ¶ 22 (App. 2014).

       A.     Spousal Maintenance Eligibility.

¶36          A party is eligible for an award of spousal maintenance if she
qualifies under any one of the five factors listed in A.R.S. § 25-319(A). In re
Marriage of Cotter, 245 Ariz. 82, 86, ¶ 10 (App. 2018). The superior court
found Wife eligible for spousal maintenance based on two factors: (1) the
parties had a marriage of long duration and Wife is of an age that may
preclude employment at a level of self-sufficiency, A.R.S. § 25-319(A)(5),
and (2) Wife significantly reduced her income or career opportunities for
Husband's benefit, A.R.S. § 25-319(A)(4).

¶37           The evidence supports the finding that Wife significantly
reduced her income or career opportunities for Husband's benefit. See
A.R.S. § 25-319(A)(4). Wife was 60 years old at trial and last worked as a
massage therapist in 2009. When the parties moved to Arizona, she left the
workforce to care for the family while Husband traveled extensively for

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work. Nothing in the record showed that Wife could obtain adequate
employment given her health or the time gap since she last worked.

¶38           Because the record supports the finding that Wife qualified
for spousal maintenance under § 25-319(A)(4), we affirm the conclusion that
Wife was eligible for spousal maintenance. Cotter, 245 Ariz. at 86, ¶ 10
(noting a party need only qualify under one factor to be eligible for spousal
maintenance).

       B.     Amount and Start Date of the Award.

¶39            Because we vacated the ruling that the joint trust account is
community property and remanded for reconsideration of this significant
asset, the superior court must reconsider the amount and duration, if any,
of the spousal maintenance award. Although we express no opinion on the
merits of this question, the court should reconsider the factors in § 25-319(B)
on remand. Accordingly, we do not address the arguments as to those
factors. We vacate the award of spousal maintenance and order the
superior court to reconsider the appropriate spousal maintenance award, if
any, on remand.

VII.   Wife's Expert Witness Fees.

¶40            The superior court ordered Husband to pay $8,000 of Wife's
business valuation expert fees because Wife prevailed on this issue. The
court also found Husband's position on the business valuation was
unreasonable and not supported by an independent and certified business
appraisal. Although the court did not cite a statute, we presume it relied
on A.R.S. § 25-324, which authorizes an award of "the costs and expenses of
maintaining or defending" a dissolution or custody proceeding. We review
this award for an abuse of discretion. See Breitbart-Napp v. Napp, 216 Ariz.
74, 83, ¶ 35 (App. 2007).

¶41           The fact that Wife prevailed on the business valuation does
not support the award of expert witness fees. "[Section] 25-324 does not
establish a prevailing party standard for awarding fees and costs." Id. at 84,
¶ 39. Because the superior court relied on an incorrect legal standard, we
vacate the order. On remand, the superior court may reinstate the fee
award if it determines that Husband's position was unreasonable
independent of Husband's decision not to obtain an independent and
certified business appraisal.

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VIII. Past Child Support.

¶42           In addition to a prospective child support order, the superior
court ordered Husband to pay past child support from July 1, 2019, to April
30, 2021. Husband argues this was an abuse of discretion because Wife used
community property royalties for the child's expenses. We review child
support awards for an abuse of discretion and accept the findings of fact
unless clearly erroneous. Engel v. Landman, 221 Ariz. 504, 510, ¶ 21 (App.
2009).

¶43          Under A.R.S. § 25-320(B), the court must order retroactive
child support if it finds, as here, (1) there is no previous order for child
support, and (2) a current child support order is appropriate. Simpson v.
Simpson, 224 Ariz. 224, 225-26, ¶¶ 7, 9 (App. 2010). Thus, the court was
required by § 25-320(B) to order past child support.

¶44            In determining the amount of the past child support order,
the court could consider any amount Husband paid for temporary or
voluntary support. A.R.S. § 25-320(B). Husband did not pay any temporary
or voluntary support directly to Wife. Nevertheless, Husband argues that
past child support is not warranted because the parties used the community
royalties for their living expenses during the proceedings. According to
Husband, he effectively paid voluntary support because Wife spent more
than her half of the royalty income. Even if we make the rather tenuous
assumption that this constitutes a "voluntary payment" of child support by
Husband, it is not clear that Wife spent more than her share of the
community funds. See supra ¶ 32. Given the conflicting evidence, we
cannot say the court abused its discretion in finding that Husband was not
entitled to credit for any "voluntary support."

¶45           Because we are vacating and remanding for the superior court
to reconsider the appropriate spousal-maintenance award, we also vacate
and remand the child-support award to allow the court to recalculate child
support to account for any change in spousal maintenance. See Guidelines
§ XVII(A) (2022).

IX.   Attorney Fees On Appeal.

¶46            Both parties request attorney fees and costs on appeal under
A.R.S. § 25-324. After considering the relevant factors, we decline to award
attorney fees without prejudice. The superior court may consider any
requests for fees on remand, including fees incurred on appeal, pending the
outcome of this litigation. The award of costs on appeal under A.R.S. § 12-
342 shall also be determined pending the result on remand.

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                               CONCLUSION

¶47          We vacate the ruling that the joint trust account is community
property and the award of Wife's expert witness fees and remand for
reconsideration. We also vacate the award of spousal maintenance but
affirm that Wife is eligible for support under § 25-319(A)(5). The court shall
reconsider an appropriate spousal maintenance award and recalculate
child support on remand. All other rulings in the decree of dissolution are
affirmed.

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

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