Court Opinion

ID: 4678655
Source: CourtListenerOpinion
Date Created: 2021-04-19 20:34:19.937732+00
Date Added: 2024-06-11T08:03:45.728055
License: Public Domain

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
                      DIVISION ONE
In the Matter of the Marriage of           )      No. 80553-3-I
                                           )
COLIN D. HOFMANN,                          )
                                           )
                     Respondent,           )
                                           )
       and                                 )
                                           )
KAREN M. HOFMANN,                          )      UNPUBLISHED OPINION
                                           )
                     Appellant.            )
                                           )

       VERELLEN, J. — In this dissolution of marriage, Karen Hofmann appeals the

trial court determination that a residence is encumbered by approximately

$294,166 that she and her former husband, Colin Hofmann, owe to Colin’s parents

for a down payment loan on that residence. Karen contends that she and Colin

have repaid the bulk of the down payment loan from the proceeds of a sale of

another house. Because substantial evidence supports the trial court’s finding that

Karen and Colin have not made any payments to Colin’s parents toward the down

payment loan, we affirm.

                                        FACTS

       Appellant Karen Hofmann and respondent Colin Hofmann married in 2008.

In 2018, Colin filed for dissolution of the marriage.
No. 80553-3-I/2

      Trial regarding dissolution of the marriage, child support, the parenting plan,

and related issues occurred over 10 days in May, June and July 2019.

      On August 8, 2019, the trial court issued detailed findings of fact and

conclusions of law. The findings and conclusions established the following facts

relevant to the issue on appeal. In 2012, Karen and Colin purchased a house at

6669H N.E. Windermere Road (Windermere house) with the assistance of Colin’s

parents, Betsy and Doug Hofmann (senior Hofmanns). The senior Hofmanns

provided a 15 percent down payment on the house. The senior Hofmanns are

equal obligors on the mortgage with the parties and are listed as co-owners on the

title to the property. All mortgage payments and taxes have been paid by Colin

and Karen. Betsy Hofmann testified credibly that her understanding was that the

arrangement for the Windermere house was the same as for her other children

where she and her husband had loaned a down payment with the expectation of

being repaid. The court found that Karen and Colin Hofmann have not made any

payments to the senior Hofmanns to pay down the loan. This is the only finding

challenged on appeal.

      Colin Hofmann was somewhat vague and evasive about his understanding

of the terms of his parents’ contribution to the Windermere house and their

ownership interest. Despite testifying about his frustration about having received

no benefit from his co-ownership and work on the previous house he co-owned

with his parents, he testified that ownership of the Windermere house was a “new

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No. 80553-3-I/3

adventure” and “ideas and details didn’t really come up.”1 The court did not find

his testimony credible on this issue. Although Douglas Hofmann was called as a

witness by Karen, neither party asked Douglas Hofmann, who is an attorney, any

questions about his understanding of the transaction and of the senior Hofmanns’

interest in the Windermere house.

       The court concluded that the parties’ interest in the Windermere house was

community property and awarded it to Colin. The court further concluded,

“Although this court cannot determine the respective interests of the elder and

junior Hofmanns, for purposes of the equitable division of assets and liabilities in

this case, the court finds that it is equitable to treat the Windermere home as

owned by Colin and Karen Hofmann and encumbered both by the mortgage and

by a loan obligation to the senior Hofmanns related to the down payment.”2

       The property division chart, attached to the findings of fact and conclusions

of law, awarded Colin the Windermere house and listed as a debt regarding the

house “less down payment loan owed to Doug & Betsy Hofmann” in the amount of

$294,166.3

       Karen appeals.

                                         ANALYSIS

       Karen challenges the amount of the $294,166 debt to the senior Hofmanns

for the down payment of the Windermere house. Karen contends that she and

       1   Clerk’s Papers (CP) at 318.
       2   CP at 320.
       3   CP at 347.

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No. 80553-3-I/4

Colin paid back $207,712.64 of this debt to the senior Hofmanns when they sold a

house that Colin had bought with his parents before he married Karen, located on

49th Avenue NE (49th Avenue house). It is undisputed on appeal that the senior

Hofmanns received a payment of $207,712.64 when the house on 49th Avenue

sold. The issue on appeal therefore is narrow: Whether the payment of

$207,712.64 to the senior Hofmanns upon the sale of the 49th Avenue house was

in repayment of their loan to Karen and Colin for the down payment on the

Windermere house.

       As an initial matter, Colin contends that we should not address this issue

because Karen raises it for the first time on appeal. At trial, the court admitted into

evidence the settlement statement for the sale of the 49th Avenue house, which

reflects a payment of $207,712.64 to the senior Hofmanns. When questioned by

his own attorney about this statement, Colin testified that his parents received

$207,712.64. Karen questioned Colin about whether the senior Hofmanns were

reimbursed with $207,712.64 of funds from the sale of the 49th Avenue house and

whether his parents loaned them money to put down on the Windermere house

until they sold the 49th Avenue house. Both Karen and Betsy Hofmann testified

that Karen and Colin were going to repay the senior Hofmanns for the down

payment loan on the Windermere house.

       The trial court’s findings and conclusions surrounding this issue, cited at

length above, also reflect that the issue was at least generally raised before the

trial court. The record does not reflect that Karen offered the trial court an exact

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No. 80553-3-I/5

amount that she believed she and Colin still owed the senior Hofmanns for the

down payment loan. But the record overall is sufficient for us to review the issue.

       “A property division made during the dissolution of a marriage will be

reversed on appeal only if there is a manifest abuse of discretion.”4 “‘A trial court

abuses its discretion if its decision is manifestly unreasonable or based on

untenable grounds or untenable reasons.’”5

 I. Trial Court’s Finding re: Loan Payments

       Karen challenges the trial court’s finding that “Karen and Colin Hofmann

have not made any payments to the elder Hofmanns to pay down the

[Windermere] loan.”6 Karen contends that substantial evidence does not support

this finding. We disagree.

       If a party challenges a finding, we determine whether substantial evidence

supports it.7 Substantial evidence exists if the record contains evidence of

sufficient quantity to persuade a fair-minded, rational person of the truth of the

declared premise.8 We then determine whether the findings of fact support the

       4  In re Marriage of Muhammad, 153 Wn.2d 795, 803, 108 P.3d 779 (2005)
(citing In re Marriage of Kraft, 119 Wn.2d 438, 450, 832 P.2d 871 (1992)).
       5
       Id. (quoting In re Marriage of Littlefield, 133 Wn.2d 39, 46-47, 940 P.2d
1362 (1997)).
       6   CP at 318.
       7   In re Marriage of Griswold, 112 Wn. App. 333, 339, 48 P.3d 1018 (2002).
       8   Id.

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No. 80553-3-I/6

trial court’s conclusions of law.9 We do not review credibility determinations, which

we leave to the trier of fact.10

       The single payment Karen contends she and Colin made to the senior

Hofmanns on the Windermere down payment loan was the $207,712.64 payment

to the senior Hofmanns when the 49th Avenue home sold. As evidence this

payment was in reimbursement of the Windermere down payment loan, Karen

points to the settlement statement for the sale of the 49th Avenue house. The

HUD-1 settlement statement for the 49th Avenue house lists as a deduction in

amount due to seller, “Payoff of second mortgage loan DOUGLAS & ELIZABETH

HOFMANN” in the amount of $207,712.64.11 The supplemental page to the

settlement statement reflects the same “payoff of second mortgage loan,” payment

to Douglas and Elizabeth Hofmann for the same amount.12

       There is no evidence on the face of the settlement statement connecting

the $207,712.64 payment in any way to the Windermere down payment loan.

       Nor was there any other evidence at trial that the $207,712.64 was a

repayment for the Windermere down payment loan. Neither of the senior

Hofmanns were questioned about the $207,712.64 payment. Karen did not testify

regarding the $207,712.64 payment. The trial court found Colin’s “somewhat

       9Landmark Dev., Inc. v. City of Roy, 138 Wn.2d 561, 573, 980 P.2d 1234
(1999) (citing Willener v. Sweeting, 107 Wn.2d 388, 393, 730 P.2d 45 (1986)).
       10  In re Marriage of Greene, 97 Wn. App. 708, 714, 986 P.2d 144 (1999)
(citing In re Marriage of Rich, 80 Wn. App. 252, 259, 907 P.2d 1234 (1996)).
       11   Ex. 580.
       12   Id.

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No. 80553-3-I/7

vague and evasive” understanding of his parents’ contribution to the Windermere

house and their ownership interest was not credible on this issue.13 We do not

review credibility determinations, which we leave to the trier of fact.14 In any event,

nothing about his testimony supports an inference that the $207,712.64 was

repayment of the Windermere down payment loan.15

       13   CP at 318.
       14   Greene, 97 Wn. App. at 714.
       15  The following was Colin’s testimony on the issue when Karen questioned
him at trial:

       Q:     And so is it true we didn’t have the money to put down on the
              6669 Windermere home because we had not yet sold the 4745
              home to obtain the funding?

       A:     I’m not sure, Karen.

       Q:     Okay. Is it true that your parents loaned us they money to put
              down on the 6669 Windermere home until we sold the 4745
              home?

       A:     No.

       Q:     Is it true they put their name on the title because they loaned us
              the money?

       A:     Their name was on the title because we couldn’t get approved
              by ourselves, so we decided to go after it as a group. The
              terms of that arrangement were unclear.

              ....

       Q:     And is it true all excess funds for the sale of the 4745 home
              reimbursed Douglas and Elizabeth Hofmann? See No. 505.

       A:     I don’t know the exact terms of it, but . . . since when this house
              was purchased, I don’t recall what they put down, but they put
              down a large portion.

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No. 80553-3-I/8

       Karen argues that any mortgage the senior Hofmanns had on the 49th

Avenue house was extinguished when they quitclaimed the 49th Avenue house to

Colin days before he married Karen in 2008. Thus, Karen contends the only loan

remaining at the time the 49th Avenue house was sold was the Windermere down

payment loan, so the $207,712.64 must have been payment on that loan. “‘It has

long been the rule that a valid quitclaim deed passes all the right, title, and interest

which the grantor has at the time of making the deed and which is capable of

being transferred by deed, unless a contrary intent appears.’”16

       The quit claim deed states, “THE GRANTORS, Douglas A. Hofmann and

Elizabeth B. Hofmann, husband and wife, for the purpose of exiting title, and for no

other consideration, hereby convey and quitclaim to GRANTEE, Colin Hofmann, a

single man, all of their right, title, and interest in and to the following described real

estate.”17 The ambiguous purpose of “exiting title, and for no other consideration”

does not suggest the quitclaim deed was intended to extinguish any loan or

mortgage the senior Hofmanns may have had on the 49th Avenue house.

       Q:     So is it true that Douglas and Elizabeth Hofmann were
              reimbursed 207,000 -- $207,712.64?

       A:     That’s what it says.

Report of Proceedings (RP) (June 3, 2019) at 973-74.
        Newport Yacht Basin Ass’n. of Condo. Owners v. Supreme Nw., Inc., 168
       16

Wn. App. 56, 67, 277 P.3d 18 (2012) (emphasis added) (quoting McCoy v. Lowrie,
44 Wn.2d 483, 486, 268 P.2d 1003 (1954)).
       17   Ex. 579.

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No. 80553-3-I/9

       Neither party points to testimony from any witness at trial regarding the

intent of the quitclaim deed. Karen argues that the senior Hofmanns intended the

quitclaim deed as a wedding gift to Colin but points to no evidence in the record to

support this alleged intent. And there is no evidence explaining or suggesting that

a HUD-1 settlement statement for one house including, under “Reductions In

Amount Due To Seller,” a “payoff of second mortgage loan DOUGLAS &

ELIZABETH HOFMANN” was a reference to a second mortgage loan on another

property unrelated to the sale that was the subject of the HUD-1 settlement

statement. The settlement statement’s reference to a second mortgage of

$207,712.64 supports a reasonable inference that the amount was a second

mortgage on the 49th Avenue house.

       Substantial evidence supports the finding that Karen and Colin have not

made any payments to the senior Hofmanns to pay down the loan on the

Windermere property.

       Because we affirm the trial court’s finding that Colin and Karen have not

made any payments to the senior Hofmanns on the Windermere down payment

loan, we reject Karen’s argument that listing the debt in the full amount of

$294,166 was a clerical error. An error is clerical when the judgment does not

embody the court’s intention.18 Listing the amount of the down payment debt as

$294,166 embodied the trial court’s intent to divide the parties’ community property

       18
        Presidential Estates Apartment Assocs. v. Barrett, 129 Wn.2d 320, 326,
917 P.2d 100 (1996).

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No. 80553-3-I/10

equally between them. The court did not abuse its discretion in awarding Colin the

Windermere house subject to an encumbrance in favor of the senior Hofmanns in

the amount of $294,166.

II. Attorney Fees

      Karen and Colin both request that we award them attorney fees on appeal

pursuant to RCW 26.09.140, but on the showing made we decline to make an

award to either based on need and ability to pay. Karen also refers to RAP 14.2,

and RAP 18.1, but she has not prevailed on appeal. We decline to award Karen

attorney fees.

      Colin also requests attorney fees on appeal on the basis that Karen was

intransigent. Colin has not shown that Karen was intransigent. We decline to

award Colin attorney fees.

      We affirm.

WE CONCUR:

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