Court Opinion

ID: 7824945
Source: CourtListenerOpinion
Date Created: 2022-09-07 18:04:40.52902+00
Date Added: 2024-06-11T16:30:50.021147
License: Public Domain

Robert H. Dudley, Justice, concurring. I concur in the result reached in the majority opinion, but do not agree with the reasoning expressed in it. This case involves the interpretation of Ark. Code Ann. § 9-12-315 (1987), the statute providing for the division of property upon divorce. The holding of the majority opinion is that by mortgaging his 119 acres of non-marital property, the appellant converted his non-marital property into security for a marital debt and relinquished any protected status for this property that he might have had under the division of property statute. The cited statute provides for division of non-marital property upon divorce, but it does not provide for non-marital property becoming subject to marital debt upon the execution of a mortgage. The majority opinion admits that the Chancellor “did not have statutory authority to divide this gift property,” but then affirms its division. For its authority the majority opinion cites the cases of Hackett v. Hackett, 278 Ark. 82, 643 S.W.2d 311 (1982) and Riegler v. Riegler, 243 Ark. 113, 419 S.W.2d 311 (1967). Neither case provides such authority. The Riegler case was decided long before the marital property statute was adopted, and the case simply does not discuss the issue, or anything close to it, even in dicta. Likewise, the Hackett case does not support the majority opinion. It provides that a Chancellor should consider the parties’ debts when dividing marital property, with which I wholly agree, but that is not the issue in the case before us. The issue in this case is whether a Chancellor can make non-marital property acquired during the marriage subject to division between the parties because of a marital debt to a third party. The power to deprive a spouse of his or her non-marital property, as provided in the majority opinion, is wholly a judicially created power. The majority opinion admits this. Such a judicially created power in a divorce proceeding is contrary to our law, for we have long held that in divorce proceedings courts of equity are bound by statutory law and cannot exercise their inherent chancery powers. Hatcher v. Hatcher, 265 Ark. 681, 580 S.W.2d 475 (1979); Wheat v. Wheat, 229 Ark. 842, 318 S.W.2d 793 (1958); Young v. Young, 207 Ark. 36, 178 S.W.2d 994 (1944); Ex parte Helmert, 103 Ark. 571, 147 S.W.2d 1143 (1912). There is no other case in which we have judicially created divorce property division law. Further, it seems that the majority opinion is internally inconsistent in this regard. It states that, under the statute, non-marital property acquired during the marriage is not subject to division. If it is not subject to division under the statute, it cannot be divided, because the divorce statute is the only basis of jurisdiction over the non-marital property. In addition, it seems that the majority opinion creates some very practical problems. This judicially created power is not fully developed, and it is not clear how far it extends. It is not directly related to the marital debt, but, instead, is related only to the security given for the marital debt. Does this mean that it also comes into being when one gives a security interest on non-marital personal property, when one creates an equitable lien on similar property, or when one signs a guaranty agreement for a credit card? Does it apply if the property was acquired by devise as well as by gift? While I do not agree with the reasoning of the majority opinion, I concur in the result because the applicable statute provides for just such a division of property. The applicable statute, Ark. Code Ann. § 9-12-315 (Supp. 1991), in pertinent part, provides: DIVISION OF PROPERTY. (a) At the time a divorce decree is entered: (1) (A) All marital property shall be distributed one-half O/2) to each party unless the court finds such a division to be inequitable. In that event the court shall make some other division that the court deems equitable taking into consideration: (i) The length of the marriage; (ii) Age, health, and station in life of the parties; (iii) Occupation of the parties; (iv) Amount and sources of income; (v) Vocational skills; (vi) Employability; (vii) Estate, liabilities and needs of each party and opportunity of each for further acquisition of capital assets and income; (viii) Contribution of each party in acquisition, preservation, or appreciation of marital property, including services as a homemaker; and (ix) The federal income tax consequences of the court’s division of property. (B) When property is divided pursuant to the foregoing considerations the court must state its basis and reasons for not dividing the marital property equally between the parties, and the basis and reasons should be recited in the order entered in the matter. (2) All other property shall be returned to the party who owned it prior to the marriage unless the court shall make some other division that the court deems equitable taking into consideration those factors enumerated in subdivision (a)(1), in which event the court must state in writing its basis and reasons for not returning the property to the party who owned it at the time of the marriage. [Emphasis added.] The majority opinion reasons that since section (a)(2), quoted above, does not mention non-marital property acquired during the marriage, it must be excluded. I cannot agree and do not think that such an opinion is in conformity with legislative intent for two reasons. First, there is no logic or reason for making a distinction between non-marital property acquired before marriage and that acquired after marriage, and we should not assume the legislative intent was to create a distinction without a rational basis. Further, while not addressing this precise issue, the court of appeals has discussed in general the issue of division of non-marital property but has never indicated that such a distinction might even possibly exist. See Smith v. Smith, 32 Ark. App. 175, 798 S.W.2d 443 (1990) and Pennybaker v. Pennybaker, 14 Ark. App. 252, 687 S.W.2d 524 (1985). The reason seems clear; there is no basis for such a distinction. In the same light, in Williford v. Williford, 280 Ark. 71, 76, 655 S.W.2d 398, 401 (1983), we wrote, “It should be noted that the chancellor is given broad powers under § 34-1214 [now Ark. Code Ann. § 9-12-315] to distribute all property in divorce, non-marital as well as marital, to achieve an equitable division.” (Emphasis supplied.) Second, and more importantly, the legislature, in section (b)(1), clearly expressed its intent that all gifts, regardless of when acquired, are to be considered non-marital property: (b) For the purpose of this section, “marital property” means all property acquired by either spouse subsequent to the marriage except: (1) Property acquired prior to the marriage, or by gift, or by bequest, or by devise, or by descent; .... Ark. Code Ann. § 9-12-315(b)(1) (Supp. 1991) (emphasis added). A fair reading of the statute as a whole clearly demonstrates that the legislature intended to create only two classes of property, marital and non-marital. It intended that the division of property statute would deal with those two classes. There is no language in the statute which creates a third class, non-marital property which is subject to a mortgage securing marital debt. Instead, the applicable division of property statute was intended to apply to non-marital property acquired both before and after marriage. Accordingly, I concur with the result reached in the majority opinion, but do so only because the statute encompasses such a result. Some of the language, and perhaps part of the holding, in Farris v. Farris, 287 Ark. 479, 700 S.W.2d 371 (1985), is inconsistent with the majority opinion as well as this concurrence. While this precise point was not argued there, I would overrule Farris to the extent that it might be inconsistent. Newbern, J., joins in this concurrence.