Karra J. Porter and Kristen C. Kiburtz, Attorneys for Appellant
Julie J. Nelson, Attorney for Appellee
JUDGE AMY J. OLIVER authored this Opinion, in which JUDGES
MICHELE M. CHRISTIANSEN FORSTER and RYAN D. TENNEY
concurred.
OLIVER, Judge:
¶1 Richard Lee Clark appeals from the district court’s decision following a two-day divorce trial. Clark challenges several aspects of the court’s ruling, including a discovery sanction for his failure to timely disclose his trial exhibits under rule 26 of the Utah Rules of Civil Procedure; findings relating to his claim that his ex-wife, Susan Jeanne Clark, dissipated the marital estate; and the court’s division of the marital property. We affirm the district court’s ruling with the exception of one aspect of the district court’s marital property determination, which we vacate and remand for additional findings.
BACKGROUND
¶2 Richard and Susan[1] married in 2002, when Richard was in his sixties and Susan was in her fifties. Richard was retired from military service and from employment as an attorney with the Department of Justice. Susan owned a wallpaper business when she met Richard but quit working shortly after they married. For the next six years, Richard and Susan lived off Richard’s retirement income from both the Army and the Department of Justice.
¶3 In 2008, Richard came out of retirement to work for a government contractor in Afghanistan, where he lived for thirty-eight months. During that time, Richard’s retirement and employment income of $814,627 was deposited into a joint account that Susan controlled. Richard returned home to find “probably about $100,000 . . . had been saved” in the joint bank account—much less than he expected—yet he said nothing to Susan at that time.
¶4 Three years after his return, Richard moved into the basement of the marital home. The following year, in 2016, Susan transferred approximately $78,000 from their joint account into her personal account, prompting Richard to confront her about what he viewed as missing money from his time in Afghanistan. Two years later, in 2018, Susan filed for divorce. Shortly afterward, Richard purchased a Harley-Davidson motorcycle with financing, which he paid off in 2020.
¶5 At the time of their divorce, Richard and Susan owned two real properties—a condo in Norfolk, Virginia (Mooring Drive), and a home in Kamas, Utah (Ross Creek). Richard had purchased Mooring Drive before the marriage for approximately $205,000. In 2003, Richard added Susan to the title of Mooring Drive, which allowed her to vote at the condominium association’s meetings and to join the board. The following year, Richard and Susan used equity loans on Mooring Drive to finance the purchase and construction of Ross Creek. From 2009—when Susan moved to Utah and Richard was in Afghanistan—until June 2019, Richard rented Mooring Drive out to others and the revenues were deposited into his separate account that was designated to pay for the property’s expenses.
¶6 During their marriage, the parties took out an equity loan on Ross Creek that matured, along with one of the equity loans from Mooring Drive, in 2019. With the divorce still pending, Susan agreed to refinance Ross Creek’s mortgage to pay off the two equity loans that were due, but only if Richard would stipulate that Mooring Drive and Ross Creek were marital property and were subject to equitable division in their pending divorce. Richard agreed, and the parties stipulated that “the Ross Creek and Mooring Drive properties shall remain marital property and shall be subject to equitable division in the parties’ divorce notwithstanding that the Ross Creek home and Mooring Drive property will no longer be jointly titled.”
¶7 In April 2019, the Mooring Drive tenants’ lease expired. Richard decided he could only offer the tenants a month-to-month lease until his divorce was over. When the tenants declined to renew and moved out in June, Richard withdrew $30,000 from the joint bank account, claiming that he needed the funds to cover Mooring Drive’s expenses. After a hearing, the court entered temporary orders in December 2019, permitting Richard to access equity in Ross Creek to pay off debt on Mooring Drive but denying his “request for financial relief based on the loss of rental income because [Richard] ha[d] not made any attempt to secure new renters.”
¶8 Trial was originally scheduled for June 2020, but when the COVID-19 pandemic hit and courts were required to hold bench trials virtually, Richard declined to proceed with a virtual trial, and it was continued without a date. In February 2021, the court held a pretrial scheduling conference and rescheduled the trial for May 2021. The court’s pretrial order stated the parties must produce pretrial disclosures on or before April 26, 2021, pursuant to rule 26(a)(5)(B) of the Utah Rules of Civil Procedure.
¶9 Richard missed the deadline. A week after it passed, he requested a continuance to hire trial counsel. Richard had been representing himself as a pro se litigant despite being eighty-four years old and not having practiced law since 1988. According to Richard, health issues arose that made him “no longer physically and mentally capable of representing” himself. The court granted the motion, rescheduling the trial for June. The new deadline for pretrial disclosures became May 24, but Richard did not submit his pretrial disclosures until June 10—eleven days before trial.
¶10 The two-day trial began with Susan’s objection to Richard’s untimely pretrial disclosures. Susan contended that Richard had “ample opportunity” to produce his pretrial disclosures given the multiple continuances of the trial. In response, Richard claimed his failure to meet the disclosure deadline was harmless because he had previously produced as discovery responses the 339 pages of financial documents—including check registers, paystubs from 2008 to 2009, and bank account information from 2011 to 2012— that he sought to admit as exhibits 2 through 8. Yet Richard did not file certificates of service for those responses, and neither party’s counsel could confirm whether Richard had previously sent the documents in exhibits 2 through 8 to Susan, leaving the district court with only Richard’s testimony to support the claim that he had previously disclosed the exhibits. The district court sustained Susan’s objection as to exhibits 2 through 8, excluding them from trial.
¶11 Both Susan and Richard testified at trial. Susan testified Richard had transferred $30,000 from their joint account to his personal account in June 2019 and contended she was entitled to half of that amount. Susan also testified about her exhibits that provided recent balances in her bank and retirement accounts.
¶12 On cross-examination, Susan admitted she had not looked for work and was unemployed despite the court’s urging in 2020 for her to seek employment. Richard then peppered Susan about numerous expenditures during his time in Afghanistan, to which Susan replied that it “was a number of years ago” and she “ha[d] no recollection at all” of the transactions. Susan did state, however, that when Richard left for Afghanistan, she recalled they “had very large credit card balances” that Richard instructed her “to start paying off” while he was away.
¶13 First testifying as Susan’s witness, Richard answered questions about some of the marital property. He testified about a recent appraisal of Mooring Drive that valued it at $390,000, his three life insurance policies that all list Susan as the beneficiary, and his purchase of the Harley-Davidson in May 2019. Susan then introduced a pleading Richard had filed with the court in November 2019 that stated, in relevant part, he had “owned three motorcycles, selling the last one when [he] moved to Norfolk,” but he has “never ridden a Harley-Davidson.” Richard replied that he had “misstated the fact,” both in that pleading and at a hearing the same month when he told the court he did not own a Harley-Davidson. Richard testified he should receive three-fourths of the equity in Mooring Drive because he purchased it before the marriage. Unable to provide a figure for what the property was worth when he married Susan, Richard claimed that “the[] prices have gone up and gone down a great deal” since their marriage, but his best guess was that Mooring Drive appreciated from $205,000 to $350,000 between 2000 and 2002. Richard continued to do some impromptu math on the stand to clarify how much equity he felt he was owed, asserting that since Mooring Drive was recently appraised at $390,000 and had been worth $350,000 in 2002—by his best guess—there is $40,000 of equity for them to divide, but then he admitted such valuation “is something I’m just not knowledgeable about.”
¶14 As his own witness, Richard testified about Susan’s alleged dissipation during his time in Afghanistan. Richard’s excluded exhibits went to the issue of dissipation, so without the financial documents from that period, Richard sought to prove Susan “dissipated money while [he] was in Afghanistan” through his testimony about his earnings and typical expenses during that time frame. Using the excluded exhibits to refresh his recollection, Richard estimated their monthly expenses before he left were approximately $10,000 to $11,000. Richard also challenged Susan’s testimony about credit card balances, claiming that “there weren’t any large credit card balances before [he] left.”
¶15 At the conclusion of trial, the district court asked both parties to submit proposed findings of fact and conclusions of law in lieu of closing arguments. After issuing an oral ruling, the district court memorialized its decision in written findings of fact and conclusions of law. The court found that Richard’s “testimony was insufficient to establish his [dissipation] claim” and that Richard had “failed to meet his burden of demonstrating dissipation.” The court also found “problems with the credibility of both parties,” specifically finding that Susan’s “credibility was lacking with regards to the dissipation issue” and Richard’s “credibility was lacking with regards to his motorcycle purchase.” Susan was awarded Ross Creek’s equity, and Richard was awarded Mooring Drive’s. The court awarded Susan $2,500 per month in alimony and an offset of $43,474 (from Richard’s purchase of the Harley-Davidson and his $30,000 withdrawal from the joint account) “to achieve an equitable division of the estate.” The court found Richard “withdrew $30,000 from the joint account without [Susan’s] knowledge or consent and deposited it into his own personal account,” but it made no findings as to how Richard spent the $30,000.
ISSUES AND STANDARDS OF REVIEW
¶16 Richard raises three main issues for our review. First, Richard challenges the district court’s exclusion of his exhibits for his failure to comply with rule 26(a)(5) of the Utah Rules of Civil Procedure. A district court “has broad discretion regarding the imposition of discovery sanctions,” and when we apply “the abuse of discretion standard to the district court’s imposition of a particular sanction, we give the district court a great deal of latitude.” Bodell Constr. Co. v. Robbins, 2009 UT 52, ¶ 35, 215 P.3d 933 (cleaned up).
¶17 Second, Richard contends the district court erred in its application of the burden of proof on Richard’s dissipation claim. A district court’s “allocation of the burden of proof is . . . a question of law that we review for correctness.” Salt Lake City Corp. v. Jordan River Restoration Network, 2018 UT 62, ¶ 20, 435 P.3d 179.
¶18 Finally, Richard challenges the district court’s division of the property, including the court’s finding that the marital estate included Mooring Drive and the Harley-Davidson, and its decision to deduct from the marital estate the $30,000 Richard withdrew from the parties’ joint account. A district court “has considerable discretion considering property division in a divorce proceeding, thus its actions enjoy a presumption of validity,” and “we will disturb the district court’s division only if there is a misunderstanding or misapplication of the law indicating an abuse of discretion.” Beckham v. Beckham, 2022 UT App 65, ¶ 6, 511 P.3d 1253 (cleaned up).
ANALYSIS
I. Pretrial Disclosures
¶19 Richard asserts the district court abused its discretion in excluding his exhibits 2 through 8 for failure to comply with rule 26(a)(5) of the Utah Rules of Civil Procedure because he “produced the documents that comprised the exhibits” during discovery and any “technical non-compliance with that rule” was “harmless.” We disagree.
¶20 Rule 26 governs “disclosure and discovery” in civil matters and requires parties to provide “a copy of each exhibit, including charts, summaries, and demonstrative exhibits, unless solely for impeachment, separately identifying those which the party will offer and those which the party may offer . . . . at least 28 days before trial.” Utah R. Civ. P. 26(a)(5). A party who fails to timely disclose exhibits “may not use the undisclosed witness, document, or material at . . . trial unless the failure is harmless or the party shows good cause for the failure.” Id. R. 26(d)(4). A district court “has broad discretion in selecting and imposing sanctions for discovery violations under rule 26,” and “appellate courts may not interfere with such discretion unless there is either an erroneous conclusion of law or no evidentiary basis for the district court’s ruling.” Wallace v. Niels Fugal Sons Co., 2022 UT App 111, ¶ 26, 518 P.3d 184 (cleaned up), cert. denied, 525 P.3d 1267 (Utah 2023).
¶21 Richard does not dispute that he failed to timely disclose exhibits 2 through 8. Instead, Richard argues he produced the documents in those exhibits to Susan in earlier discovery responses, so his failure to timely file pretrial disclosures was harmless, and he further argues that it was Susan’s burden to prove she had not received them. In response, Susan asserts it was Richard’s burden, not hers, to prove that he produced the documents earlier in discovery, and the failure to file his pretrial disclosures pursuant to rule 26(a)(5) was not harmless. We agree with Susan on both fronts.
¶22 First, “the burden to demonstrate harmlessness or good cause is clearly on the party seeking relief from disclosure requirements.” Dierl v. Birkin, 2023 UT App 6, ¶ 32, 525 P.3d 127 (cleaned up), cert. denied, 527 P.3d 1107 (Utah 2023). Second, Richard failed to carry his burden of demonstrating harmlessness. Although Richard “assured [his counsel] that he [had] produced records related to this 2008-to-2012 timeframe,” he did not file the required certificates of service. See Utah R. Civ. P. 26(f) (requiring a party to file “the certificate of service stating that the disclosure, request for discovery, or response has been served on the other parties and the date of service”). Thus, Richard failed to prove that the documents had previously been produced.
¶23 But even if he had proved prior production, excusing pretrial disclosures if the documents were produced earlier in discovery would “eviscerate[] the rule that explicitly requires parties to” serve a copy of the documents they intend to use “in their case-in-chief at trial.” Johansen v. Johansen, 2021 UT App 130, ¶¶ 19, 26, 504 P.3d 152 (rejecting argument to follow the spirit of rule 26 rather than “the plain language of rule 26” regarding pretrial disclosures); see also Utah R. Civ. P. 26(a)(5)(A)(iv) (requiring pretrial disclosure of “each exhibit” the party will or may offer at trial). And expecting a party to sort through hundreds, if not thousands, of pages of documents that were produced earlier by the other side during discovery and then expecting the party to predict which ones the opposing party might seek to admit at trial would be harmful and would violate the intent of rule 26.
¶24 Ultimately, “a court’s determination with respect to harmlessness . . . . is a discretionary call,” and our review of it “is necessarily deferential.” Johansen, 2021 UT App 130, ¶ 11 (cleaned up). Thus, the district court was well within its “broad discretion” to exclude Richard’s exhibits 2 through 8 under these circumstances. See Wallace, 2022 UT App 111, ¶ 26 (cleaned up).
II. Dissipation
¶25 Richard claims the district court erred in finding that he failed to meet the burden of proof on his dissipation claim. We disagree.
¶26 “The marital estate is generally valued at the time of the divorce decree or trial.” Goggin v. Goggin, 2013 UT 16, ¶ 49, 299 P.3d 1079 (cleaned up). “But where one party has dissipated an asset,” the “trial court may, in the exercise of its equitable powers,” “hold one party accountable to the other for the dissipation.” Id. (cleaned up). A court’s inquiry into a dissipation claim may consider “a number of factors,” such as “(1) how the money was spent, including whether funds were used to pay legitimate marital expenses or individual expenses; (2) the parties’ historical practices; (3) the magnitude of any depletion; (4) the timing of the challenged actions in relation to the separation and divorce; and (5) any obstructive efforts that hinder the valuation of the assets.” Wadsworth v. Wadsworth, 2022 UT App 28, ¶ 69, 507 P.3d 385 (cleaned up), cert. denied, 525 P.3d 1259 (Utah 2022).
¶27 The burden of proof for dissipation initially falls on the party alleging it. See Parker v. Parker, 2000 UT App 30, ¶ 15, 996 P.2d 565 (stating that a party seeking to assert dissipation must make an “initial showing of apparent dissipation”). The district court correctly concluded that Richard bore the “burden of demonstrating dissipation.” To meet the “initial showing of apparent dissipation,” the party alleging dissipation must first show evidence of dissipation. Id. ¶¶ 13, 15. Only after “present[ing] the trial court with evidence tending to show that [Susan] had dissipated marital assets” does the burden shift to Susan “to show that the funds were not dissipated, but were used for some legitimate marital purpose.” Id. ¶ 13.
¶28 Richard’s documentary evidence on this issue had been excluded by the court, so the only evidence he presented was his testimony in 2021 that his income while in Afghanistan from 2008 to 2012 exceeded the estimated historical marital expenses from before 2008, some thirteen years earlier. Richard asserts that his testimony alone should suffice for an initial showing of dissipation. In Parker v. Parker, 2000 UT App 30, ¶ 15, 996 P.2d 565, the husband “presented the trial court with evidence” that detailed how the wife had dissipated marital assets—exact beginning and ending balances for eight bank accounts, the marital expenses during the time in question, and specific checks the wife wrote to herself—thus shifting the burden to the wife. Id. ¶ 13. But Richard, like the wife in Parker, only “testified in conclusory and cryptic terms,” and thus “wholly failed to meet [his] burden.” Id. ¶ 14.
¶29 Therefore, the district court was well within its discretion to decide that Richard’s uncorroborated testimony about Susan’s spending that occurred many years before either party contemplated divorce[2] was insufficient evidence to meet his initial burden of proving dissipation. Accordingly, the district court did not err in its finding that Richard failed to meet his burden of proof on the dissipation claim.
III. Marital Property
¶30 Richard presents three challenges to the district court’s division of the marital property. First, Richard asserts he is entitled to his premarital contribution to Mooring Drive. Second, he alleges the Harley-Davidson he purchased during the pendency of the divorce is his separate property. Third, Richard claims the court should not have deducted from the marital estate the $30,000 that he withdrew from the joint account in June 2019.
We affirm the district court’s decision on Richard’s first two challenges and vacate the decision on the third, remanding the matter for additional findings.
A. Mooring Drive
¶31 Although the district court awarded Richard the equity in Mooring Drive when it divided the marital estate, it did not also award Richard any premarital equity in the property for three reasons. First, it found that Richard “formally stipulated that Ross Creek and Mooring Drive were marital property subject to division in this divorce action.” Second, it found that “through a series of refinances, [Richard] transferred equity from Ross Creek to Mooring Drive, and paid expenses associated with both properties with marital funds.” Third, it found that Richard “formally conveyed the property to himself and [Susan] in 2003” when he added Susan’s name to the title. Because we affirm the district court’s decision not to award Richard any premarital equity on the basis of the parties’ stipulation, we do not address the other two reasons the district court relied upon.
¶32 Richard and Susan stipulated that “the Ross Creek and Mooring Drive properties shall remain marital property and shall be subject to equitable division in the parties’ divorce, notwithstanding that the Ross Creek home and Mooring Drive property will no longer be jointly titled.” Richard now claims that despite the language of the stipulation, he “never agreed that he should not be compensated for his premarital and separate contributions to Mooring Drive before the property became marital.” Furthermore, Richard argues, “nowhere in the stipulation did he agree that he was waiving his premarital equity in that property.”
¶33 Richard’s argument is flawed. “Parties to a divorce are bound by the terms of their stipulated agreement.” McQuarrie v. McQuarrie, 2021 UT 22, ¶ 18, 496 P.3d 44. And according to the “ordinary contract principles” that govern “contracts between spouses,” see Ashby v. Ashby, 2010 UT 7, ¶ 21, 227 P.3d 246 (cleaned up), “if the language within the four corners of the contract is unambiguous, the parties’ intentions are determined from the plain meaning of the contractual language,” Green River Canal Co. v. Thayn, 2003 UT 50, ¶ 17, 84 P.3d 1134 (cleaned up). See also Mind & Motion Utah Invs., LLC v. Celtic Bank Corp., 2016 UT 6, ¶ 24, 367 P.3d 994 (holding that “the best indication of the parties’ intent is the ordinary meaning of the contract’s terms”); Ocean 18 LLC v. Overage Refund Specialists LLC (In re Excess Proceeds from the Foreclosure of 1107 Snowberry St.), 2020 UT App 54, ¶ 22, 474 P.3d 481 (holding that where the “contract is facially unambiguous, the parties’ intentions are determined from the plain meaning of the contractual language . . . without resort to parol evidence” (cleaned up)).
¶34 Richard essentially argues that the district court erred when it refused to go beyond the stipulation’s language and infer his intention from what he omitted. But the district court was correct when it interpreted the parties’ intentions by what the plain language of the stipulation does say and not by what it does not. Therefore, the district court did not abuse its discretion when it abided by the parties’ stipulation and included Mooring Drive as marital property, “subject to equitable division.”
B. The Harley-Davidson
¶35 “Prior to the entry of a divorce decree, all property acquired by parties to a marriage is marital property, owned equally by each party.” Dahl v. Dahl, 2015 UT 79, ¶ 126, 456 P.3d 276. Thus, the presumption is that property acquired during the pendency of a divorce is marital, not separate. Richard failed to rebut this presumption regarding the Harley-Davidson motorcycle he purchased because he failed to present evidence that he used separate funds.
¶36 Richard argued that he purchased the Harley-Davidson from separate, rather than marital, funds in his proposed findings of fact and conclusions of law.[3] To be clear, Richard does not assert that the Harley-Davidson is separate property because he purchased it after the parties separated or after Susan filed for divorce. Instead, he argues the only funds available to him to purchase the motorcycle came from his “separate premarital retirement income.” Richard’s argument fails for two reasons. First, Richard did not present evidence to support his argument that the funds he used to purchase the motorcycle came from separate, not marital, funds. Instead, Richard essentially places his burden on the district court by asserting, on appeal, that “[t]here was no marital account identified by the district court from which [Richard] could have made that purchase.” But Richard, not the court, bears the burden of identifying where the funds came from that he used to purchase the motorcycle.
¶37 Second, the district court found credibility problems with Richard’s testimony about the Harley-Davidson, concluding that Richard’s “credibility was lacking with regards to his motorcycle purchase.”[4] A district court “is in the best position to judge the credibility of witnesses and is free to disbelieve their testimony” or “disregard such testimony if it finds the evidence self-serving and not credible.” Ouk v. Ouk, 2015 UT App 104, ¶ 14, 348 P.3d 751 (cleaned up).
¶38 In sum, as “property acquired during [the] marriage,” the Harley-Davidson is presumptively “marital property subject to equitable distribution.” Dahl, 2015 UT 79, ¶ 26. Richard bore the burden of proof to rebut the presumption that the funds he used to purchase the Harley-Davidson were not marital, and he presented no credible evidence to the district court to support that position. Thus, the district court did not abuse its discretion by including the motorcycle in the marital estate.
C. $30,000 Offset
¶39 Finally, Richard challenges the district court’s decision to include in the marital estate the $30,000 he withdrew from the joint account. The district court agreed with Susan that because Richard had made a unilateral withdrawal from the joint account during the pendency of the divorce, he should be held accountable for that withdrawal. Richard, on the other hand, claims he used the money for marital expenses, paying costs associated with Mooring Drive. Susan argues the money could also have been spent on personal items including travel and motorcycle payments and accessories. “How the money was spent, including whether [the] funds were used to pay legitimate marital expenses or individual expenses,” Wadsworth v. Wadsworth, 2022 UT App 28, ¶ 69, 507 P.3d 385 (cleaned up), cert. denied, 525 P.3d 1259 (Utah 2022), is a critical question that needs to be resolved.
¶40 Divorce cases often require district courts to make numerous findings of fact. And generally speaking, “for findings of fact to be adequate, they must show that the court’s judgment or decree follows logically from, and is supported by, the evidence” and such findings “should be sufficiently detailed and include enough subsidiary facts to disclose the steps by which the ultimate conclusion on each factual issue was reached.” Armed Forces Ins. Exch. v. Harrison, 2003 UT 14, ¶ 28, 70 P.3d 35 (cleaned up). Moreover, when it comes to the “unequal division of marital property,” a district court must “memorialize[] in . . . detailed findings the exceptional circumstances supporting the distribution.” Bradford v. Bradford, 1999 UT App 373, ¶ 27, 993 P.2d 887 (cleaned up). “Without adequate findings detailing why [one spouse] should be entitled to such an unequal split of the marital estate, we cannot affirm the court’s award.” Fischer v. Fischer, 2021 UT App 145, ¶ 29, 505 P.3d 56; see, e.g., Rothwell v. Rothwell, 2023 UT App 50, ¶ 57, 531 P.3d 225 (concluding that “we simply do not have enough information” to rule on whether the funds were marital or separate, “let alone to conclude that the district court
. . . erred”).
¶41 We face the same dilemma here. The district court made no findings as to how Richard spent the $30,000. The written ruling merely states, “In June 2019, [Richard] withdrew $30,000 from the joint account without [Susan’s] knowledge or consent and deposited it into his own personal account.” “We will not imply any missing finding where there is a matrix of possible factual findings and we cannot ascertain the trial court’s actual findings.” Hall v. Hall, 858 P.2d 1018, 1025–26 (Utah Ct. App. 1993). Without “adequate findings” on whether Richard used the funds for marital expenses or not, “we cannot affirm,” nor properly review, the court’s decision to offset the $30,000 against Richard in its division of the marital estate. See Fischer, 2021 UT App 145, ¶ 29. Therefore, we vacate this portion of the decision and remand the matter to the district court for it to enter findings on how the funds were spent.
CONCLUSION
¶42 The district court did not abuse its discretion when it excluded Richard’s exhibits for failure to comply with rule 26(a)(5) of the Utah Rules of Civil Procedure. The district court also did not err in its conclusion that Richard failed to meet the burden of proof for his dissipation claim nor did it abuse its discretion in how it divided the marital estate with respect to Mooring Drive and the Harley-Davidson. We vacate the district court’s decision to offset the $30,000 against Richard when it divided the marital estate and remand the matter for the district court to enter additional findings and to alter its conclusion as may be necessary.
[1] Because the parties share the same surname, we refer to them by their first names, with no disrespect intended by the apparent informality.
[2] Susan invites us to join some other states in drawing a bright-line rule concerning the timing of a dissipation claim and limit pre-separation dissipation claims to those occurring (1) in contemplation of divorce or separation or (2) when the marriage is in serious jeopardy or undergoing an irretrievable breakdown. Under our caselaw, the district court is empowered to consider the “timing of the challenged actions in relation to the separation and divorce” as one of several factors when determining “whether a party should be held accountable for the dissipation of marital assets.” Marroquin v. Marroquin, 2019 UT App 38, ¶ 33, 440 P.3d 757 (cleaned up). We see no need to alter this approach. Assessing timing as one factor among many provides the greatest flexibility to the district court to consider all the circumstances in a particular case, and we believe the district court is in the best position to evaluate the importance of such evidence on a case-by-case basis.
[3] Because the district court directed the parties to submit proposed findings of fact and conclusions of law in lieu of closing arguments, Richard’s argument was preserved for our review.
[4] Indeed, in its oral ruling, the court stated that Richard “lied to the Court about the purchase of the motorcycle.”
Julie J. Nelson, Taylor Webb, and Stephen C. Clark,
Attorneys for Appellant
Bart J. Johnsen and Alan S. Mouritsen,
Attorneys for Appellee
JUDGE DAVID N. MORTENSEN authored this Opinion, in which
JUDGES RYAN D. TENNEY and AMY J. OLIVER concurred.
MORTENSEN, Judge:
¶1 After a trial on cross-petitions, the district court entered
findings of fact and conclusions of law and a final decree divorcing Rebecca and Jared Knight. Rebecca[1] appeals several aspects of the divorce decree, including the court’s determination that she had no interest in a trust Jared’s father established before the marriage and several of the court’s calculations related to alimony. We affirm the district court’s ruling with respect to Jared’s trust, and we affirm in part and reverse in part with respect to the alimony calculations.
BACKGROUND
¶2 In October 1994, Jared’s father, L. Randy Knight, created the RKF Jared M. Knight Trust (the Trust), an irrevocable trust. Randy named Jared as the sole beneficiary of the Trust and transferred a significant interest in RKF, LLC—an Arizona limited liability company formed in 1994 by Randy—to the Trust. The trust agreement for the Trust (Trust Agreement) specified that the Trust would be governed by Arizona law. The Trust Agreement also contained a “spendthrift provision” declaring that Jared lacked the “right to assign, transfer, encumber, or hypothecate his . . . interest in the principal or income of the [T]rust in any manner.” Additionally, the Trust Agreement granted Jared a power of withdrawal over the Trust principal such that Jared could withdraw up to one-fourth of the principal at age 30 (June 2002), up to one-third of the principal at age 35 (June 2007), and all the principal at age 40 (June 2012). To exercise this power, Jared would need to make “a request in writing.”
¶3 In October 1995, Jared and Rebecca were married. During their marriage, the parties enjoyed a lavish lifestyle funded, in part, by the wealth of Jared’s family.
¶4 In March 2008, Rebecca and Jared executed a “Property Agreement” (the Property Agreement), which stated, “All property which is now owned by JARED or by REBECCA, individually, . . . is hereby declared to be, and hereby is, the community property of JARED and REBECCA.” The Property Agreement specified that “to the extent necessary, JARED and REBECCA each hereby gives, grants, conveys and assigns to the other an interest in his or her property . . . so as to transmute[2] such property into the community property of JARED and REBECCA.” The Property Agreement further declared, “All property hereafter acquired by JARED and REBECCA, or either of them, . . . shall be deemed to be, and hereby declared to be, the community property of JARED and REBECCA.” However, the Property Agreement carved out an exception: “Notwithstanding the foregoing, any property received by JARED and REBECCA by gift or inheritance after the date of this [Property] Agreement shall be the sole and separate property of the person receiving it, unless that person declares otherwise in writing.” The Property Agreement is, like the Trust, governed by Arizona law.
¶5 In 2016, the Trust was decanted[3] into a new trust. The new trust named Jared as sole initial trustee and therefore permitted Jared to distribute to himself, “upon his written request, up to the balance of the principal of his trust at any time.”
¶6 In April 2018, Jared filed for divorce. Rebecca ultimately filed an amended counterclaim alleging that the principal of the Trust was marital property and therefore subject to equitable distribution under the terms of the Property Agreement.
¶7 Jared filed a motion for partial summary judgment on this point, arguing that the Property Agreement “did not transmute assets held by the [Trust]” into marital property. Jared asserted that the Property Agreement did not apply to the Trust because, at the time he entered into the Property Agreement, he did not own the Trust principal under Arizona law. He pointed to the statute in effect in 2008—the year the parties entered into the Property Agreement—which stated that “if the trust instrument provides that a beneficiary’s interest in principal is not subject to voluntary or involuntary transfer, the beneficiary’s interest in principal shall not be transferred.” Ariz. Rev. Stat. Ann. § 147702(a) (2008). The statute further specified that a court may not order the satisfaction of a money judgment against a beneficiary until “[a]fter an amount of principal becomes immediately due and payable to the beneficiary.” Id. § 14-7702(b). It explained that “[i]f an amount of principal is due and payable only at a future date, or only on the occurrence of a future event, whether the occurrence of that event is within the control of the beneficiary, the amount of the principal is not immediately due and payable to the beneficiary.” Id. Jared asserted that the Trust’s “disbursement mechanism squarely fit[] within the framework of Arizona Revised Statute Section 14-7702(B) as it was written in 2008” because the Trust’s requirement that Jared submit a written request for disbursement of the Trust principal rendered the principal “not immediately due and payable.” See id. And Jared argued that, because he never submitted a written disbursement request or withdrew any principal of the Trust, “[a]s a matter of Arizona law as it existed at the time that the Property Agreement was executed in 2008, no amount of the Trust principal is ‘now owned’ or ‘hereafter acquired’” by Jared, so the Property Agreement did not apply to the Trust.
¶8 Rebecca opposed Jared’s motion and filed her own motion for partial summary judgment. Rebecca argued that Jared’s beneficial interest in the Trust was a property interest that Jared owned at the time of the Property Agreement. She also asserted that Jared’s power of withdrawal gave him an ownership interest in the Trust principal that he was eligible to withdraw as of the date of the Property Agreement. She said, “Consistent with the common understanding of ‘property’ as comprising a set of rights (a ‘bundle of sticks’ in the law-school formulation), if among those rights a person has the right to control the disposition of an asset, that asset is his property, and he has ownership of the property.” Rebecca further avowed that “[t]he Arizona statute on which Jared relies . . . has nothing to do with the question before this [c]ourt” because it applies to “the rights of ‘creditors’ to access property held in trust for a beneficiary when the trust features a ‘spendthrift’ clause” and Rebecca was not a creditor. Accordingly, Rebecca claimed that the Trust’s spendthrift clause “did not limit Jared’s ability to transmute his property interest in the Trust or its underlying assets into community property, and he plainly did so by signing the Property Agreement.” Rebecca argued that the Restatement (Third) of Trusts instead applied and made it “clear that trust assets subject to an exercisable power of withdrawal are ‘property.’” (Citing Restatement (Third) of Trusts § 56 cmt. b. (Am. L. Inst. 2003) (“Trust property subject to a presently exercisable general power of appointment (a power by which the property may be appointed to the donee, including one in the form of a power of withdrawal), because of the power’s equivalence to ownership, is treated as property of the donee.” (emphasis added))).
¶9 The court denied Rebecca’s motion for partial summary judgment and granted Jared’s. The court reasoned that “the legal position taken in [t]he Restatement (Third) of Trusts § 56 was not the law in Arizona until 2009, when it [was] partially codified as part of the Arizona Trust Code,” and it rejected Rebecca’s argument that “the spendthrift clause specifically disengages for purposes of the exercise of a power of withdrawal [and] expressly allows a trustee to transfer withdrawn property to a beneficiary.” The court determined, instead, that Arizona Revised Statutes section 14-7702 applied because—regardless of whether Rebecca was a “creditor”—“that statute . . . define[d] when an amount is due and payable and separately define[d] the rights of creditors.”
Accordingly, the court concluded that “[n]o amount of the Trust principal is due or payable within the meaning of that statute, and it is therefore protected against . . . the disbursement sought by [Rebecca].” The court thus ruled that because Jared’s interest in the Trust principal was “not subject to voluntary or involuntary transfer,” see Ariz. Rev. Stat. Ann. § 14-7702(a) (2008), it could not be transferred through the Property Agreement.
¶10 The parties then proceeded to trial on the other issues involved in their divorce, including distribution of the marital estate and alimony. The district court entered its order, later entering its findings of fact and conclusions of law and issuing the divorce decree. As relevant to this appeal, in its alimony calculations, the court made several reductions to Rebecca’s claimed expenses.
¶11 First, the court made several modifications to the expenses Rebecca submitted related to home maintenance. The court eliminated the snow removal expense of $175 per month, stating, “The parties never paid for snow removal during the marriage[,] and this expense was not part of the marital [lifestyle].” It eliminated the monthly “[p]ool/[s]pa maintenance” expense of $373.33, reasoning that “[t]he parties did not have pool maintenance expense[s] during the marriage as the pool was maintained by the parties” and “[t]his new expense was only incurred after separation and because [Rebecca] is not cleaning the pool despite acknowledging she is capable of doing so.” And it eliminated the monthly landscaping expense of $414.66 because “[t]his was not an expense that was incurred during the marriage as the yard work was done by the parties themselves.” It continued, “[Rebecca] further acknowledged that she is capable of yard work. Also, [Jared] has not requested that he [have] third parties do his yard maintenance.”
¶12 Next, the district court modified several of Rebecca’s expenses related to health and personal care. It reduced Rebecca’s health care insurance expense from $757 per month to $411 per month, explaining,
[Rebecca] is not incurring this expense but is covered under the parties’ current policy. In addition, no written evidence was provided as to the costs for health care coverage for [Rebecca]. [Rebecca] acknowledged the $757 was for a policy with no deductibles[,] which is not the same level of policy the parties currently have in place, which has [an] $8,000 a year deductible. Further, the [c]ourt has received evidence in other cases that health care coverage for a single person can be obtained in the $400 to $500 a month range. Therefore, the [c]ourt adjusts [Rebecca’s] coverage to be consistent with [the] current known expense of health care of the parties and which [Jared] established at $411 a month.
The court also reduced Rebecca’s expense for personal grooming from $949.83 per month to $500 a month. It stated,
[Rebecca’s] evidence of getting a haircut twice a year and having her nails and eye lashes done monthly to every six (6) weeks did not establish this claimed and requested expense of $11,397.96 a year for personal expenses. [Jared] did not ask for any personal grooming as part of his expenses relating to the marital standard of living[,] and he [is] not getting the $500 [Rebecca] is being awarded.
¶13 Finally, the court made several adjustments to Rebecca’s claimed expenses related to savings. The court eliminated Rebecca’s “[s]avings [p]lan contribution” of $2,500 per month. The court explained,
[Rebecca] admitted that this amount was only an estimate on her part in that she thought the parties may have saved $30,000 a year. [Jared’s] testimony was the parties did not contribute to any savings plan for the parties in any amount on a monthly or regular basis. Rather, the parties would save money as they had it in differing amounts and when there were sufficient funds to purchase what they wanted, the parties would spen[d] the money on cars and other purchases. No savings program was done during the marriage. In addition, [Jared] has not requested a savings plan as part of his expenses, and he is entitled to the same marital standard as [Rebecca].
The court eliminated “[r]etirement deposits” of $500 per month, stating,
The evidence adduced at trial established the parties never saved $500 a month for retirement. Further, [Jared] did not ask for retirement as part of his expenses relating to the marital standard of living[,] giving further credibility to this fact. The evidence was any retirement amounts for the parties was only set aside and deposited in three (3) of the twenty-seven (27) years of marriage.
The court eliminated Rebecca’s “additional capital/investment funds” of $7,279 monthly because “[t]he testimony and evidence established there never was any such capital or investment funds like this during the marriage. Further, no testimony was provided as to how this figure was arrived at to be claimed in the first place.” The court declared that “[t]his is simply a request, which is unfounded and which the [c]ourt finds is an attempt to inflate [Rebecca’s] expenses.”
¶14 Rebecca now appeals.
ISSUES AND STANDARDS OF REVIEW
¶15 Rebecca presents three issues on appeal. First, she asserts that “the district court erred when it determined, on summary judgment, that Rebecca had no interest in [the] Trust.” “When an appellate court reviews a district court’s grant of summary judgment, the facts and all reasonable inferences drawn therefrom are viewed in the light most favorable to the nonmoving party, while the district court’s legal conclusions and ultimate grant or denial of summary judgment are reviewed for correctness.” Massey v. Griffiths, 2007 UT 10, ¶ 8, 152 P.3d 312 (cleaned up).
¶16 Second, Rebecca argues that even “if the district court’s interpretation and application of Arizona law to the Trust and the Property Agreement were correct, it nonetheless abused its discretion when it refused to divide the Trust on equitable grounds.” “District courts have considerable discretion concerning property distribution in a divorce[,] and we will uphold the decision of the district court unless a clear and prejudicial abuse of discretion is demonstrated.” Gerwe v. Gerwe, 2018 UT App 75, ¶ 8, 424 P.3d 1113 (cleaned up).
¶17 Third, Rebecca contends that “the district court erred in its calculation of alimony.” “A district court’s award of alimony is reviewed for abuse of discretion.” Id. ¶ 9. “Although trial courts have broad latitude in determining whether to award alimony and in setting the amount, and we will not lightly disturb a trial court’s alimony ruling, we will reverse if the court has not exercised its discretion within the bounds and under the standards we have set,” including if the court commits legal error. Bjarnson v. Bjarnson, 2020 UT App 141, ¶ 5, 476 P.3d 145 (cleaned up).
ANALYSIS
I. Rebecca’s Interest in the Trust
¶18 Rebecca argues that the district court erred in ruling that she was not entitled to an equitable share of the Trust. Rebecca first asserts that the court erred in applying the 2008 Arizona Trust Code (the 2008 Code) because the 2009 Arizona Trust Code (the 2009 Code) applied retroactively and indicated that Jared’s power of withdrawal gave him an ownership interest subject to transmutation under the Property Agreement. She also argues, alternatively, that even if the 2008 Code applies, Jared’s interest in the Trust was marital property. Jared counters that the 2008 Code applies, that his “interest in the Trust principal was bound by a valid spendthrift provision” at the time of the Property Agreement, and that it was therefore not transferrable through the Property Agreement.
¶19 We agree with Jared and uphold the district court’s decision on this issue. First, we conclude that the 2009 Code does not retroactively modify the nature of Jared’s interest in the Trust at the time of the Property Agreement.[4] Even if application of the 2009 Code would have the effect Rebecca claims, we cannot apply that version of the code.
¶20 Arizona law indicates that “beginning on January 1, 2009[,] . . . [the 2009 Code] applies to all trusts created before, on or after January 1, 2009.” Act of Dec. 31, 2008, ch. 247 § 18(A)(1), 2008 Ariz. Sess. Laws 1179, 1179 (2nd Reg. Sess.). The parties entered the Property Agreement in March 2008. Because this date predates January 1, 2009, the 2009 Code had not taken effect at the time the parties signed the Property Agreement and therefore had no application to the Trust. Indeed, the Arizona Legislature did not leave this point ambiguous but rather included a specific provision stating that “[a]n act done before January 1, 2009[,] is not affected by this act.” Id. Arizona caselaw has interpreted this exception to mean that the preexisting law governed until January 1, 2009. See Favour v. Favour, No. 1 CA-CV 13-0196, 2014 WL 546361, ¶ 30 (Ariz. Ct. App. Feb. 11, 2014) (stating that a previous statute “governs actions taken by a trustee prior to implementation of the Arizona Trust Code . . . on January 1, 2009,” and that the earlier statute “recognized the trustee’s investment and management authority,” so “as a matter of law, [the trustee] had the authority to invest, trade, diversify, and manage trust assets prior to January 1, 2009” (cleaned up)); In re Esther Caplan Trust, 265 P.3d 364, 366 (Ariz. Ct. App. 2011) (“The past principal distributions are not governed by [the 2009 Code]. That statute became effective after the challenged distributions were made. The predecessor statute . . . merely required a trustee to keep the beneficiaries of the trust reasonably informed of the trust and its administration. The record establishes that [the appellee] complied with these relatively minimal requirements.” (cleaned up)).
¶21 Accordingly, at the time the parties signed the Property Agreement, the 2008 Code was in effect. If the parties had signed the Property Agreement on, say, January 2, 2009, the 2009 Code could retroactively apply to the Trust—though it was created in 1994—to govern its terms. But because the Property Agreement was signed before the 2009 Code went into effect, the 2009 Code’s retroactivity provision also had no effect. Therefore, Jared’s interest in the Trust for the sake of the Property Agreement was whatever existed under the 2008 Code, and any restrictions of the Trust as of March 2008 had full effect and were not modified by the 2009 Code. Put another way, Jared could not give an interest in property in 2008 that he did not have the right to transfer.
¶22 Under the 2008 Code, the Trust’s spendthrift provision prevented Jared from transmuting his interest in the Trust into marital property.[5] The 2008 Code specified that “if [a] trust instrument provides that a beneficiary’s interest in principal is not subject to voluntary or involuntary transfer, the beneficiary’s interest in principal shall not be transferred.” Ariz. Rev. Stat. Ann. § 14-7702(a) (2008). The Trust was subject to a spendthrift provision, declaring that Jared lacked the “right to assign, transfer, encumber, or hypothecate his . . . interest in the principal or income of the [T]rust in any manner.” Consequently, Jared’s interest in the Trust was “not subject to voluntary or involuntary transfer,” so his interest was not eligible for transfer. See id.; see also In re Indenture of Trust Dated Jan. 13, 1964, 326 P.3d 307, 312 (Ariz. Ct. App. 2014) (“A valid spendthrift provision makes it impossible for a beneficiary to make a legally binding transfer.” (emphasis added) (cleaned up)).
¶23 In an effort to avoid the restrictive effect of the Trust’s spendthrift provision, Rebecca argues that “[t]ransmuting property is distinct from transferring property” and therefore “Jared did not transfer any interest” when he allegedly transmuted his interest in the Trust through the Property Agreement. Citing State ex rel. Industrial Commission of Arizona v. Wright, 43 P.3d 203 (Ariz. Ct. App. 2002), Jared responds that Arizona caselaw rejects this argument:
[In Wright], the court explained that the term “transfer” “includes any transaction in which a property interest was relinquished.” Because transmuting a property interest from separate property to community property surrenders the transferor’s entitlement to half of his or her separate property, the court reasoned, such a transmutation qualifies as a “transfer” of that property.
(Citations omitted.) Rebecca responds that the holding of Wright applies “only in the specific context of the Uniform Fraudulent Transfers Act.”
¶24 In Wright, the Arizona Court of Appeals considered a premarital agreement that was fraudulently modified after a husband fell subject to a workers’ compensation claim. Id. at 204. The modification stated that separate earnings would be community property, thus attempting to evade a judgment against the husband’s earnings. Id. The court held that the transmutation of the husband’s earnings constituted a transfer under the Uniform Fraudulent Transfers Act:
Before the modification, [the husband] held a sole interest in the entirety of his future earnings. The effect of the modification was to transfer that entire interest to the community. [The wife] would have a right to dispose of those earnings now dedicated to the community that she did not have when they were [the husband’s] separate property. Additionally, upon dissolution of marriage, [the husband] would have surrendered all entitlement to half of those earnings. Hence, [the husband] has transferred an asset within the meaning of [the Uniform Fraudulent Transfers Act].
Id. at 205. While the Wright court did conclude that the parties’ actions satisfied the broad statutory definition of a transfer under the Uniform Fraudulent Transfers Act, see id., and while Rebecca is correct that the Uniform Fraudulent Transfers Act is not at issue here, the court’s analysis is still useful. If we accept Rebecca’s argument that the Property Agreement transmuted Jared’s interest in the Trust, then—like in Wright—before the Property Agreement, Jared’s interest in the Trust was solely his and the Property Agreement served to “transfer that entire interest to the community.” See id. And upon divorce, Jared “would have surrendered all entitlement to half of” his interest in the Trust. See id. Accordingly, while we are not applying the definition of “transfer” from the Uniform Fraudulent Transfers Act, we conclude that a transmutation here would have been a transfer. In terms of the bundle of sticks formulation that Rebecca referenced in her motion for partial summary judgment, Jared would be giving Rebecca access to and an interest in whatever sticks he was holding at the time he signed the Property Agreement—sticks that she did not previously hold.[6]
¶25 Our conclusion that Jared’s purported transmutation of the Trust into marital property would have constituted a transfer is supported by the language of the Property Agreement itself. The Property Agreement indicated that “to the extent necessary, JARED and REBECCA each hereby gives, grants, conveys and assigns to the other an interest in his or her property . . . so as to transmute such property into the community property of JARED and REBECCA.” (Emphasis added.) This language belies Rebecca’s argument that the transmutation only changed the nature of—but did not affect a transfer of—Jared’s interest. And this language also runs up against the language in the Trust’s spendthrift provision forbidding Jared from “assign[ing], transfer[ing], encumber[ing], or hypothecat[ing] his . . . interest in the principal or income of the [T]rust in any manner.” Accordingly, we agree with the district court that the Property Agreement had no effect on the Trust and that, therefore, Rebecca does not have a legally cognizable interest in the Trust.
II. Equitable Grounds for Dividing the Trust
¶26 Rebecca contends, alternatively, that “[r]egardless of whether the Property Agreement granted Rebecca a legally cognizable interest in the Trust itself, the district court was required to consider the Trust as part of the marital property for the sake of equity.” She asserts that “[d]istrict courts must equitably divide the marital estate” and quotes Dahl v. Dahl, 2015 UT 79, 459 P.3d 276, for the propositions that “Utah law presumes that property acquired during a marriage is marital property subject to equitable distribution” and “[t]o the extent that the Trust corpus contains marital property, Utah has a strong interest in ensuring that such property is equitably divided in the parties’ divorce action.” Id. ¶ 26. Rebecca points us to Endrody v. Endrody, 914 P.2d 1166 (Utah Ct. App. 1996), in which a husband’s parents had established a trust after the parties were married and had named the wife as one of the beneficiaries. Id. at 1167–68. This court affirmed a district court’s ruling that the trust assets were not available for distribution as marital assets but that the husband’s shares in the trust were marital property, an equitable share of which should be placed in a constructive trust for the wife’s benefit. Id. at 1170. Rebecca concludes, “In short, Jared’s interest in the Trust was marital property. And even if the Trust assets were not available for distribution, the court was required to consider the Trust as part of the marital property for equitable purposes.”
¶27 Rebecca’s argument misses the mark. We have concluded, as did the district court, that Jared’s interest in the Trust was not marital property or part of the marital estate subject to distribution. This is a distinct conclusion from one stating that trust funds are marital property but the trust principal is not available for distribution. Therefore, caselaw addressing equitable distribution of trust funds that are marital property is inapposite. And Rebecca provides no support for the position that she should be awarded an equitable portion of the value of the Trust’s principal despite a holding that she is not entitled to any portion of Jared’s interest in the Trust.[7] Accordingly, we uphold the district court’s decision that Rebecca is not entitled to any portion of or equivalent sum for Jared’s interest in the Trust.
III. Alimony
¶28 Rebecca next contends that the court erred in its alimony calculations when it made several deductions to Rebecca’s claimed expenses. Rebecca insists that she “does not raise a factual challenge” but instead “challenges the district court’s method of reduction and justification for doing so.” She asserts that the district court “misconstrued Utah law” when it adjusted her expenses.
¶29 Under Utah law, courts must consider in alimony determinations the factors listed in Utah Code section 30-3-5, including “(i) the financial condition and needs of the recipient spouse; (ii) the recipient’s earning capacity or ability to produce income, including the impact of diminished workplace experience resulting from primarily caring for a child of the payor spouse; [and] (iii) the ability of the payor spouse to provide support.” Utah Code § 30-3-5(10)(a); see also Jones v. Jones, 700 P.2d 1072, 1075 (Utah 1985); English v. English, 565 P.2d 409, 411–12 (Utah 1977). “An alimony award should also advance, as much as possible, the primary purposes of alimony.” Rule v. Rule, 2017 UT App 137, ¶ 14, 402 P.3d 153 (cleaned up). Alimony is intended “(1) to get the parties as close as possible to the same standard of living that existed during the marriage; (2) to equalize the standards of living of each party; and (3) to prevent the recipient spouse from becoming a public charge.” Jensen v. Jensen, 2008 UT App 392, ¶ 9, 197 P.3d 117 (cleaned up).
¶30 We have previously explained,
Alimony is not limited to providing for only basic needs but should be fashioned in consideration of the recipient spouse’s station in life in light of the parties’ customary or proper status or circumstances, with the goal being an alimony award calculated to approximate the parties’ standard of living during the marriage as closely as possible.
Rule, 2017 UT App 137, ¶ 14 (cleaned up); see also Davis v. Davis, 749 P.2d 647, 649 (Utah 1988) (“The ultimate test of the propriety of an alimony award is whether, given all of these factors, the party receiving alimony will be able to support him- or herself as nearly as possible at the standard of living enjoyed during marriage.” (cleaned up)); Savage v. Savage, 658 P.2d 1201, 1205 (Utah 1983) (“One of the chief functions of an alimony award is to permit the parties to maintain as much as possible the same standards after the dissolution of the marriage as those enjoyed during the marriage.”). And “in terms of alimony, the marital standard of living analysis is about whether the parties’ proposed points of calculation are consistent with the parties’ manner of living and financial decisions (i.e., the historical allocation of their resources).” Mintz v. Mintz, 2023 UT App 17, ¶ 24, 525 P.3d 534, cert. denied, 523 P.3d 730 (Utah 2023).
A. Home Maintenance
¶31 Rebecca alleges that the district court improperly reduced her claimed expenses related to home maintenance, including expenses for snow removal, pool and spa maintenance, and landscaping. She argues that Jared took care of these tasks during the marriage and she should now be compensated for the cost of hiring other individuals to accomplish these tasks. In her words, “Rebecca’s marital standard of living was that someone else did the pool maintenance, snow removal, and landscaping. Since that person has moved out, she is left without the standard of living to which she was accustomed.”
¶32 Rebecca’s argument on this point is fatally flawed. A court’s inquiry in evaluating historical expenses to determine alimony involves the marital standard of living—not a separate standard of living for each person within the marriage. See Davis, 749 P.2d at 649 (describing “the standard of living enjoyed during marriage” (cleaned up)); Rule, 2017 UT App 137, ¶ 14 (considering “the parties’ standard of living during the marriage” (cleaned up)); Jensen, 2008 UT App 392, ¶ 9 (discussing the “standard of living that existed during the marriage” as one but the “the standards of living of each party” after divorce as two (cleaned up)). The marital standard of living is that which the parties shared, and courts consider the parties as a single unit when evaluating that standard. We can only imagine the chaos that would ensue if divorcing partners could expense every task their former spouses previously performed.[8] Instead, we reemphasize that “in terms of alimony, the marital standard of living analysis is about whether the parties’ proposed points of calculation are consistent with the parties’ manner of living and financial decisions (i.e., the historical allocation of their resources).” Mintz, 2023 UT App 17, ¶ 24. Rebecca admits that the couple did not historically allocate funds to these expenses while the parties were married, so they cannot be considered part of the marital standard of living. And the court found as much, stating, “[t]he parties never paid for snow removal during the marriage[,] and this expense was not part of the marital [lifestyle]”; “[t]he parties did not have pool maintenance expense[s] during the marriage as the pool was maintained by the parties”; and landscaping “was not an expense that was incurred during the marriage as the yard work was done by the parties themselves.” Therefore, the court was correct in reducing Rebecca’s claims for these categories when calculating her expenses for the sake of alimony.[9]
¶33 However, Rebecca did provide evidence that the parties had historically paid some amount for bark replacement and lawn aeration. In a financial declaration, she listed a monthly expense of $126.66 for “[b]ark for the year,” and she indicated that “[t]his [was] based on an actual historical expense of $3,040.00 every 2 years.” She also listed a monthly expense of $5 for aerating and stated that “[t]his [was] based on an actual historical expense of $30 paid twice per year.” Additionally, she testified that the parties had historically replaced bark and that doing so was “quite costly.”[10] Jared, in a memorandum submitted to the court, admitted that bark was an expense that the parties had previously paid and did not contest the aerating expense. Therefore, the costs associated with bark replacement and lawn aeration were part of the marital standard of living such that they were not properly excluded from consideration in the court’s alimony calculations. Accordingly, because the facts are otherwise undisputed on this issue, we reverse on this point and instruct the court to enter expenses for Rebecca of $5 per month for lawn aeration and $126.66 per month for bark replacement.
B. Health and Personal Care
1. Health Insurance
¶34 Rebecca asserts that the district court abused its discretion in reducing her claimed expense for health insurance. At trial, she informed the court that she was still on Jared’s family’s health insurance plan but explained her claimed cost of $757 monthly: “This was a quote that I sought out. . . . It does not have any deductible. . . . [H]istorically our deductible [was] put on an HSA card that was covered by the Knight Group.” Both parties agreed that the historical deductible, which had been paid by the Knight Group, was around $8,000.
¶35 The court reduced Rebecca’s health insurance expense to $411 per month, the number Jared gave as the historical amount the parties paid for health care services through an HSA card. The court explained, “[N]o written evidence was provided as to the costs for health care coverage for [Rebecca]. [Rebecca] acknowledged the $757 was for a policy with no deductibles[,] which is not the same level of policy the parties currently have in place, which has [an] $8,000 a year deductible.” The court indicated that its adjustment was “consistent with current known expense[s] of health care of the parties and which [Jared] established at $411 a month.”
¶36 This conclusion was in keeping with the court’s determination that monetary support from the Knight family qualified as gifts and could not be considered in determining the marital standard of living or the parties’ expenses. It noted, “[I]n this case . . . a large portion of these things the parties were enjoying was the result of the generosity and the benefits of others. When there’s . . . no guarantee or no requirement to have those additional funds come in . . . to have this lifestyle, you know, they’re not going to be able to have it.” The court again said, “You can’t count gifts . . . that were given at the discretion of other individuals to say you’re entitled to continue to receive those gifts and have those funds coming in to you to maintain a standard of living that you may have [had] when you received those gifts . . . .”
¶37 The court’s stance on this issue is correct: the gifts from Jared’s family, despite being a regular feature of the marriage, may not be properly considered in calculating Rebecca’s needs or Jared’s ability to pay alimony. See Utah Code § 30-3-5(10)(a). The alimony factors refer only to the finances of the spouses, not those of outside parties. Id.; see also Jones v. Jones, 700 P.2d 1072, 1075 (Utah 1985). Additionally, we have enunciated previously that past gifts are not to be considered in the alimony calculus: “[T]he court could not base its prospective order on past gifts that have no assurance of being continued because [a donor] has no legal obligation to continue providing the monetary support that she has in the past.” Issertell v. Issertell, 2020 UT App 62, ¶ 26, 463 P.3d 698.
¶38 Accordingly, the court did not abuse its discretion when it determined that Rebecca did not provide qualifying evidence of her future health insurance expenses because she submitted only a quote for a plan without a deductible. The parties both testified that they had a deductible during the marriage, and Rebecca is not entitled to a health insurance plan better than the one the parties had during the marriage. The fact that the parties’ deductible was historically paid by the Knight Group does not impact our analysis because those payments were “past gifts that have no assurance of being continued because [the Knight Group] has no legal obligation to continue providing the monetary support that [it] has in the past.” See id. And without evidence from Rebecca on which it could rely, the court did not abuse its discretion in accepting the amount Jared put forth as the parties’ historical health insurance cost.[11] See Sauer v. Sauer, 2017 UT App 114, ¶ 10, 400 P.3d 1204 (“Once the court determined that there was no evidence that was both credible and relevant regarding [the recipient spouse’s] reasonable housing needs, it was appropriate for the court to impute a reasonable amount based on other evidence provided by the parties. . . . We therefore see no impropriety in the trial court’s decision to impute housing needs to [the recipient spouse] in the same amount as [the payor spouse] had claimed was reasonable . . . .”). We affirm on this point.
2. Personal Grooming
¶39 Rebecca also asserts that the court abused its discretion in reducing Rebecca’s claimed expense for “personal grooming.” The court stated that it was “reduc[ing] personal grooming by $449.83, from $949.83 to $500 a month,” because Rebecca’s “evidence of getting a haircut twice a year and having her nails and eye lashes done monthly to every six (6) weeks did not establish this claimed and requested expense of $11,397.96 a year for personal expenses.” The court also stated that Jared “did not ask for any personal grooming as part of his expenses relating to the marital standard of living[,] and he was not getting the $500 [Rebecca was] being awarded.”
¶40 Rebecca takes issue with the court’s findings and reasoning, asserting,
[T]his was not the evidence. She testified that she gets her eyelashes and nails done every two weeks, not “monthly to every six (6) weeks.” She testified that in addition to getting her hair cut, she also gets a perm. She testified that she gets a full body wax. She also testified that she has costs for “toenails.” She also testified that she has “maintenance” costs. She stated that to reach this number she “went through [her] credit card statements and added up for a year’s worth of” these expenses. She testified that “obviously this is historically . . . what I spent.”
Opposing counsel did not dispute Rebecca’s expenses, but simply opined that he thought “the maximum would be . . . $500 a month. $6000 a year for personal grooming is quite a nice budget.” But what opposing counsel thinks qualifies as “quite a nice budget” is not the test in Utah. Instead, the test is the marital standard of living, and Rebecca’s testimony—unchallenged by contrary evidence— was that she spent $949.83 per month.
Second, the district court reduced Rebecca’s personal grooming expenses because Jared “did not ask for any personal grooming as part of his expenses relating to the marital standard of living and he was not getting the $500 [Rebecca] is being awarded.” That is irrelevant. If Jared spends nothing on personal grooming, or if he has no monthly expenses because the Knight family pays for them all, that does not mean that Rebecca’s estimated expenses are inaccurate.
¶41 We agree with Rebecca on all fronts. The court would have acted within its discretion if it had found Rebecca’s evidence unreliable or had determined that Rebecca’s claimed expenses were unreasonable in light of the couple’s marital standard of living. See Woolums v. Woolums, 2013 UT App 232, ¶ 10, 312 P.3d 939 (“The district court’s evaluation of and reliance on [one spouse’s] testimony, along with its own determinations of the reasonableness of the claimed expenses, fell squarely within its broad discretion to determine an appropriate alimony award.”). But that is not what it did. It disregarded Rebecca’s evidence of historical spending and substituted a figure provided by Jared’s counsel with no evidentiary basis. Jared’s counsel’s thoughts on what makes “quite a nice budget” are irrelevant. The court’s inquiry should have been rooted in Rebecca and Jared’s marital standard of living, as indicated by their historical spending. See Mintz v. Mintz, 2023 UT App 17, ¶ 24, 525 P.3d 534, cert. denied, 523 P.3d 730 (Utah 2023).
¶42 A court’s inquiry into the marital standard of living must evaluate the specific circumstances of that couple, and expenses that are unreasonable in light of one couple’s marital standard of living may be reasonable in light of another couple’s marital standard of living. “Indeed, we have explained that alimony is not limited to providing for only basic needs but should be fashioned in consideration of the recipient spouse’s station in life in light of the parties’ customary or proper status or circumstances.” Rule v. Rule, 2017 UT App 137, ¶ 14, 402 P.3d 153 (cleaned up). And “the goal” of the inquiry is “an alimony award calculated to approximate the parties’ standard of living during the marriage as closely as possible.” Id.; see also Davis v. Davis, 749 P.2d 647, 649 (Utah 1988) (“The ultimate test of the propriety of an alimony award is whether, given all of these factors, the party receiving alimony will be able to support him- or herself as nearly as possible at the standard of living enjoyed during marriage.” (cleaned up)); Savage v. Savage, 658 P.2d 1201, 1205 (Utah 1983) (“One of the chief functions of an alimony award is to permit the parties to maintain as much as possible the same standards after the dissolution of the marriage as those enjoyed during the marriage.”). Rebecca testified that the marital standard of living included significant spending on her personal grooming. The court acted improperly when it discarded this evidence and substituted another amount without properly concluding that Rebecca’s evidence was inadequate or her expenses were unreasonable in light of the marital standard of living.
¶43 It was also improper for the court to base its determination, in part, on Jared’s lack of submission for this budget line item. There is no need for courts to limit one party’s expenses to those the other party also claims. See Utah Code § 30-3-5(10)(a) (including as a factor in determining alimony “the financial condition and needs of the recipient spouse”). In fact, doing so increases the risk of gamesmanship between the parties. There is already a risk that divorcing spouses may inflate their claimed expenses in an effort to sway the alimony calculation in their favor: payor spouses might attempt to minimize their ability to provide support by claiming high expenses, while recipient spouses might inflate their expenses to claim that their needs are great. See id. But limiting a recipient spouse’s potential expenses to only those categories claimed by the payor spouse dangerously alters this already-thorny calculation. In situations where a payor spouse’s ability to pay is unlikely to be an issue, the payor spouse would face a significant incentive to omit many expenses and thereby drastically reduce the receiving spouse’s needs. But the danger is not just in these situations. In any case, a payor spouse would be incentivized to identify categories for which the recipient spouse would likely have higher expenses and omit those. In other words, payor spouses could significantly undercut alimony awards by strategically omitting expenses. Accordingly, we caution courts not to apply such faulty reasoning when calculating alimony. Instead, courts should base their findings on expenses that are reasonable in light of the couple’s unique marital standard of living. See Mintz, 2023 UT App 17, ¶ 24.
¶44 On this front, we clarify that a couple’s marital standard of living may include disparate spending by the parties on various categories during the marriage. Throughout the marriage, one spouse may spend more—even significantly more—than the other on personal grooming, entertainment, travel, or any number of other expense categories. A partner may embrace the age-old adage’s modernized mantra of “happy spouse, happy house,” may derive independent pleasure from a spouse’s purchases, or may observe a spouse’s spending habits—whether for monthly follicle support treatments or Jazz tickets only one spouse actually uses—through gritted teeth. But for the sake of calculating alimony, we assume that the parties agreed on their household expenditures such that whatever was historically spent by the parties during the marriage constitutes the couple’s marital standard of living, even if the spending was lopsided—or, indeed, one-sided—within a given expense category. See Davis, 749 P.2d at 649; Rule, 2017 UT App 137, ¶ 14. Consequently, whether Jared truly spent nothing on personal grooming historically or he simply elected to omit his expenses in that category, the court erred in limiting its acceptance of Rebecca’s personal grooming expenses based on Jared’s lack of submission.
¶45 The court abused its discretion when it applied the wrong legal standard to Rebecca’s claimed expenses for personal grooming. Because the court did not find Rebecca’s evidence unreliable or determine that Rebecca’s claimed expenses were unreasonable in light of the couple’s marital standard of living, we reverse its decision on this point and instruct it to modify its findings to include the $949.83 per month consistent with the parties’ marital standard of living.
C. Savings and Other Funds
1. Savings Plan
¶46 Rebecca asserts that the court wrongfully entirely rejected her expense for a “[s]avings [p]lan” of $2,500 per month. First, she points to the court’s statement that “[Jared] has not requested a savings plan as part of his expenses, and he is entitled to the same marital standard as [Rebecca].” As we have discussed, such a consideration has no place in the alimony analysis under Utah law. Additionally, the court summarized the evidence related to a savings plan:
[Rebecca] admitted that this amount was only an estimate on her part in that she thought the parties may have saved $30,000 a year. [Jared’s] testimony was the parties did not contribute to any savings plan for the parties in any amount on a monthly or regular basis. Rather, the parties would save money as they had it in differing amounts and when there were sufficient funds to purchase what they wanted, the parties would spen[d] the money on cars and other purchases.
From this, the court concluded that “[n]o savings program was done during the marriage.” But in so concluding, the court misapplied Utah law on this subject.
¶47 In Mintz v. Mintz, 2023 UT App 17, 525 P.3d 534, cert. denied, 523 P.3d 730 (Utah 2023), we considered a similar question of whether “the district court erred in excluding from the alimony award an amount reflective of historical investment” where a couple had a habit of investing money “essentially as savings.” Id. ¶¶ 2, 16. There, the parties’ testimonies established that “[b]efore 2014, they made deposits into investment accounts ‘when money was left over after normal marital spending,’ and after 2014, they made direct deposits into investment accounts as part of [the husband’s] employment.” Id. ¶ 2. We reiterated that, in situations like these, “[t]he critical question is whether funds for post-divorce savings, investment, and retirement accounts are necessary because contributing to such accounts was standard practice during the marriage and helped to form the couple’s marital standard of living.” Id. ¶ 17 (quoting Bakanowski v. Bakanowski, 2003 UT App 357, ¶ 16, 80 P.3d 153). We noted that “when the Bakanowski court provided the test for appropriate consideration of savings, investment, and retirement accounts in alimony calculations, it cited” another case “in which the court reasoned that because the parties had made regular savings deposits, including savings in the alimony award could help maintain the recipient spouse’s marital standard of living.” Id. ¶ 18 (cleaned up). Then we clarified that “an event must certainly be recurring but need not be uniformly systematic to be considered ‘regular.’ Indeed, something can be done ‘regularly’ if done whenever the opportunity arises, though the actual time sequence may be sporadic.” Id. ¶ 19 (cleaned up). So, we explained,
Even if savings deposits and investments do not occur on an exact timetable, such marital expenditures can be considered a standard practice in those infrequent and unusual circumstances where a party can produce sufficiently persuasive evidence that savings deposits and investments were a recurring marital action whenever the opportunity arose, though the actual time sequence may be sporadic.
Id. ¶ 20 (cleaned up). And we concluded that the parties’ testimonies that they made substantial deposits into investment accounts “at least annually” “established that the parties followeda regular pattern, i.e., a standard practice, of investing a portion of their annual income.” Id. ¶ 21 (cleaned up).
¶48 We then considered the question of whether the parties’ standard practice of investing contributed to their marital standard of living, because “to justify an alimony award that includes an amount for investment, the parties’ acts of investing must also contribute to the ‘marital standard of living.’” Id. ¶ 22 (quoting Bukunowski, 2003 UT App 357, ¶ 16). We concluded that the parties’ standard practice of investing did contribute to their marital standard of living, so we remanded “the case to the district court to recalculate alimony based on the amount that the couple’s historical investment contributed to the marital standard of living.” Id. ¶ 28. The same is true for savings: a court must determine whether a couple’s standard practice of saving contributed to their marital standard of living to incorporate savings into an alimony award. See id.
¶49 Here, such a conclusion is less apparent from the district court’s findings than was true in Mintz. The court’s description of Rebecca’s testimony of annual savings and of Jared’s testimony that the parties would save to fund large purchases certainly suggests that savings may have been a standard practice during the marriage that contributed to the marital standard of living. See id. ¶¶ 20–22; Bukunowski, 2003 UT App 357, ¶ 16; Kemp v. Kemp, 2001 UT App 157U, paras. 3–4. But the court’s findings regarding the regularity of the couple’s savings habits are insufficient for us to hold that this standard is clearly met. Still, the court’s conclusion that “[n]o savings program was done during the marriage” does not clearly follow from its other findings, given our caselaw on this topic. The court’s focus strictly on monthly savings habits is myopic and at odds with precedent, and the court provides no explanation for its interpretation of Jared’s testimony that the parties did not save on a “regular basis.” Therefore, we conclude that the court exceeded its discretion on this matter insofar as it applied the incorrect legal standard. SeeBjarnson v. Bjarnson, 2020 UT App 141, ¶ 5, 476 P.3d 145 (“We will reverse [an alimony award] if the court has not exercised its discretion within the bounds and under the standards we have set . . . .” (cleaned up)). We remand this matter for the court to make additional findings as to the regularity of the parties’ savings deposits. On remand, “the court should, as a legal matter, ensure it employs the correct legal definitions of standard practice and marital standard of living, apply the facts of [this] case to those definitions, and then determine whether the facts as found meet the criteria for a savings-based alimony award.” Mintz, 2023 UT App 17, ¶ 17.
2. Retirement
¶50 Rebecca also asserts that the court erred in entirely rejecting her submitted expense for “[r]etirement deposits” of $500 per month. The court explained that “[t]he evidence adduced at trial established the parties never saved $500 a month for retirement. . . . The evidence was any retirement amounts for the parties was only set aside and deposited in three (3) of the twenty-seven (27) years of marriage.” The court again improperly discussed the point that “[Jared] did not ask for retirement as part of his expenses relating to the marital standard of living,” but rather than relying on this point to deny Rebecca’s claim for a retirement savings provision in the alimony award, the court stated that this point gave “further credibility to th[e] fact” that the parties did not regularly save for retirement. More importantly, and unlike for the savings category, the court’s conclusion that there was no standard practice of saving for retirement flows from its findings on the irregularity of the parties saving for retirement while married.
¶51 Furthermore, Rebecca does not argue on appeal that the court applied the wrong legal standard here. She explains that Jared did not submit a retirement expense because he “is worth literally millions of dollars and Rebecca, when she was married, also anticipated having millions of dollars available for retirement.” She argues that “[t]o even come close to approximating the marital standard of living, Rebecca must start to save for retirement.” But this is not in line with our caselaw. Again, we look to the parties’ “historical allocation of their resources” to determine their marital standard of living, id. ¶ 24, and Rebecca does not argue that the parties historically allocated their resources by saving regularly for retirement. Therefore, the court did not abuse its discretion in determining that saving for retirement was not a feature of the marital standard of living and, accordingly, removing that claimed expense when calculating alimony. We affirm on this point.
3. Additional Capital/Investment Funds
¶52 Finally, Rebecca contends that the court was wrong to reject her expense for “additional capital/investment funds” of $7,279 monthly. The court did so because “[t]he testimony and evidence established there never was any such capital or investment funds like this during the marriage. Further, no testimony was provided as to how this figure was arrived at to be claimed in the first place.” The court declared that “[t]his is simply a request, which is unfounded and which the [c]ourt finds is an attempt to inflate [Rebecca’s] expenses.” Rebecca argues on appeal that this “is incorrect” and that her “[f]inancial [d]eclaration provide[d] a detailed explanation of how the figure was computed: ‘This is an amount based on funds the parties historically had available from [Jared’s] family wealth for discretionary investments . . . .’” This argument does not prevail. As we have explained, past gifts are excluded from the alimony calculus. See Issertell v. Issertell, 2020 UT App 62, ¶ 26, 463 P.3d 698. The funds that were historically available for investment were gifts, and as such, they are not properly considered as a standard practice contributing to the marital standard of living. See id.; Mintz, 2023 UT App 17, ¶¶ 20–22. Therefore, the court was acting within its discretion as to this item, and we affirm its decision in this respect.
CONCLUSION
¶53 The district court did not err in determining that Rebecca had no interest in the Trust, and it did not abuse its discretion in deciding against dividing the Trust on equitable grounds. We affirm in this respect.
¶54 As to alimony, the court exceeded its discretion when it applied the wrong legal standard when calculating several of Rebecca’s expenses. Accordingly, we reverse the court’s decision with respect to Rebecca’s personal grooming expenses and the expenses associated with lawn aeration and bark replacement. We also remand the matter for further factual findings as to the regularity of the parties’ savings deposits and a determination of whether, applying the law correctly, the parties’ savings habits constituted a standard practice contributing to the marital standard of living. We affirm the remainder of the court’s alimony determinations.
Because divorce is not about a spouse (man or woman) getting “half of everything”.
Depending upon whether a state is a “community property” state or an “equitable distribution” state, here is how property is divided between spouses in a divorce:
A community-property state is state in which spouses hold property that is acquired during marriage (other than property acquired by one spouse by inheritance, devise, or gift) as community property. Otherwise stated, all property that is acquired during the marriage by either spouse (other than property acquired by one spouse by inheritance, devise, or gift) or by both spouses together is jointly and equally owned and will be presumed to be divided in divorce equally between the divorcing spouses. Nine states are community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin.
An equitable distribution state seeks to divide property in divorce in a fair, but not necessarily equal, manner. An equitable property state court can divide property between the spouses regardless of who holds title to the property. The courts consider many factors in awarding property, including (but not limited to) a spouse’s monetary contributions, nonmonetary assistance to a spouse’s career or earning potential, the efforts of each spouse during the marriage, the length of the marriage, whether the property was acquired before or after marriage, and whether the property acquired by one spouse by inheritance, devise, or gift. The court may take into account the relative earning capacity of the spouses and the fault of either spouse (See Black’s Law Dictionary, 11th ed.). Equitable distribution is applied in the non-community property states.
So, does a spouse “get half of everything” in divorce? Possibly, but not always, and now you know why.
I am not licensed to practice law in the state of New York, but I will answer your question according to the law of the jurisdiction where I do practice law (Utah) because that may give you an idea of how the issue is treated in Utah. You will need to consult with a knowledgeable New York family law attorney to know the correct answer to your question as it applies under New York law.
The decision in the Utah case of Lindsey v. Lindsey (392 P.3d 968, 833 Utah Adv. Rep. 16, 2017 UT App 38) is a perfect explanation of the circumstances under which a spouse’s separate property can be awarded to the other spouse in a divorce case, so I will cite excerpts from that decision below (I did not include the footnotes from the decision):
ANALYSIS
¶31 When distributing “marital property in a divorce proceeding, the overriding consideration is that the ultimate division be equitable-that property be fairly divided between the parties.” Granger v. Granger, 2016 UT App 117, ¶ 15, 374 P.3d 1043 (brackets, citation, and internal quotation marks omitted). To that end, a trial court must first “identify the property in dispute and determine whether it is marital or separate.” Dahl v. Dahl, 2015 UT 79, ¶ 121 (brackets, citation, and internal quotation marks omitted). Marital property ordinarily includes “all property acquired during marriage,” “whenever obtained and from whatever source derived.” Dunn v. Dunn, 802 P.2d 1314, 1317-18 (Utah Ct. App. 1990) (citation and internal quotation marks omitted). Separate property ordinarily includes premarital property, gifts, and inheritances, including any appreciation that may accrue during the marriage. See Dahl, 2015 UT 79, ¶ 143; Mortensen v. Mortensen, 760 P.2d 304, 308 (Utah 1988).
¶32 The presumption is that marital property will be divided equally while separate property will not be divided at all. See Dahl, 2015 UT 79, ¶ 121; Dunn, 802 P.2d at 1323. Married persons have a right to separately own and enjoy property, and that right does not dissipate upon divorce. See Mortensen, 760 P.2d at 308. Thus, equity generally requires that “each party retain the separate property he or she brought into the marriage, including any appreciation” thereof. Dunn, 802 P.2d at 1320, 1323; accord Dahl, 2015 UT 79, ¶ 143; Mortensen, 760 P.2d at 308.
¶33 But separate property “is not totally beyond a court’s reach.” Elman v. Elman, 2002 UT App 83, ¶ 19, 45 P.3d 176 (brackets, citation, and internal quotation marks omitted). Before carving property out of the marital estate, a trial court must consider whether circumstances warrant an equitable override of the separate-property retention rule. See Henshaw v. Henshaw, 2012 UT App 56, ¶ 15, 271 P.3d 837. Three circumstances have been identified under Utah law as supporting an award of separate property at the time of divorce. These exceptions are when separate property has been commingled [the Lindsey v. Lindsey case did not treat the commingling exception, so I will provide some information on that in a footnote to this answer[1]]; when the other spouse has augmented, maintained, or protected the separate property [the contribution exception]; and in extraordinary situations when equity so demands. See Mortensen, 760 P.2d at 308; Dunn, 802 P.2d at 1320. The latter two exceptions are at issue here.
*****
¶35 Under the contribution exception, a spouse’s separate property may be subject to equitable distribution when “the other spouse has by his or her efforts or expense contributed to the enhancement, maintenance, or protection of that property, thereby acquiring an equitable interest in it.” Mortensen, 760 P.2d at 308. This exception may be satisfied when one spouse brings assets into the marriage and the other spouse’s prudent investment of those assets substantially increases their value, see Dubois v. Dubois, 504 P.2d 1380, 1381 (Utah 1973), or when marital funds are expended or marital debt is incurred for the benefit of one spouse’s separate property, see Schaumberg v. Schaumberg, 875 P.2d 598, 602-03 (Utah Ct. App. 1994). In addition, this court has contemplated that the exception might apply when one spouse works for a business owned by the other spouse but is not “paid a wage or salary,” see Rappleye v. Rappleye, 855 P.2d 260, 262-63 (Utah Ct. App. 1993), or when a spouse elects to forgo salary or related compensation that would have benefited the marriage so that those funds may be reinvested in his or her separate business, see Keyes v. Keyes, 2015 UT App 114, ¶ 30, 351 P.3d 90. Under such circumstances, one spouse’s effort or investment may render the other spouse’s underlying asset, its appreciated value, or some portion thereof subject to equitable distribution. See, e.g., Schaumberg, 875 P.2d at 602-03.
¶36 While spouses often contribute to one another’s financial success in a variety of ways, Utah law draws a line between contributions that qualify as “enhancement, maintenance or protection” of a spouse’s separate property and those that do not. See Jensen v. Jensen, 2009 UT App 1, ¶¶ 11, 16, 203 P.3d 1020 (citation and internal quotation marks omitted). Under Utah law, perhaps the most common type of spousal assistance-taking on some measure of household or family responsibilities to allow the other spouse to spend time enhancing the value of his or her separate property-has been rejected as a standalone basis for awarding separate property under the contribution theory. See id. ¶ 16.
¶37 As this court concluded in Jensen, one spouse’s efforts to “maintain[] the household,” provide childcare, and run a part-time business that “contributed to [the] family finances” were insufficient to justify awarding even “part” of the appreciated value of the other spouse’s interest in the corporation of which he was president. Id. ¶¶ 4, 10-11, 15-16 (internal quotation marks omitted). Although the wife’s efforts may have enabled her husband to devote his attention to his employment, she had not sufficiently contributed to the increase in value of the corporation’s equity: “Wife did not assist in running the business nor contribute in any way to its increase in equity. Moreover, it [was] unclear whether the increase in equity was due to anything other than inflation.” Id. ¶ 16. Likewise, in Kunzler v. Kunzler, the contribution exception was not triggered by one spouse’s assumption of household responsibilities, which allowed the other spouse “to focus his time and energy on preserving and increasing the value” of his separate property. 2008 UT App 263, ¶¶ 19 & n.5, 32, 37, 190 P.3d 497.
¶38 The division of labor among married parties may take any number of forms, and the give-and-take often inherent in marital relationships is generally not a sufficient basis for judicially rewriting title to property. The presumption that parties retain their separate property at divorce would be rendered largely irrelevant if rebutted by any spousal effort that freed the other spouse to work on his or her separate property. Thus, for purposes of this exception, direct involvement with or financial expenditures toward a spouse’s separate property appear to be key.
*****
The Extraordinary Circumstances Exception
¶46 Under Utah law, a spouse’s separate property may be awarded to the other spouse “in extraordinary situations where equity so demands.” Elman v. Elman, 2002 UT App 83, ¶ 19, 45 P.3d 176 (citation and internal quotation marks omitted). The bar for establishing an extraordinary situation is high, traditionally requiring that “invasion of a spouse’s separate property” is “the only way to achieve equity.” Kunzler v. Kunzler, 2008 UT App 263, ¶ 35, 190 P.3d 497. A quintessential extraordinary situation arises when a spouse owns separate property but lacks income to provide alimony; in that circumstance, “an equitable distribution of the [separate property] would be well within the trial court’s discretion.” See id. ¶ 37; see also Burt v. Burt, 799 P.2d 1166, 1169 (Utah Ct. App. 1990) (“The court may award an interest in the inherited property to the non-heir spouse in lieu of alimony.”). An extraordinary situation has also arisen under “very unique” circumstances in which, absent the exception, a husband would have shared in profits his wife created as to their marital property, but she would not have shared in profits he created-and which she enabled him to create-with respect to his separate property. Elman, 2002 UT App 83, ¶ 24 & n.5.
¶47 Depending on the facts of a specific case, a court might take into account the rate of return earned on separate property during the marriage when determining whether an extraordinary situation exists or in calculating the amount of any such award. See, e.g., id. ¶¶ 20, 26, 29-30 (affirming an award of “a small share of the appreciation on [the husband’s] partnership interests,” which was “only above a reasonable rate of appreciation”). But an award of separate property may also be independent of any rate of return earned on the property during the marriage. See Henshaw v. Henshaw, 2012 UT App 56, ¶ 20 n.7, 271 P.3d 837 (rejecting the argument that, because the spouse’s separate property declined in value during the marriage, the other spouse could not receive an equitable interest under the “extraordinary situations” exception (citation and internal quotation marks omitted)). If a court were to award separate property due to a spouse’s inability to pay alimony, for example, that award could well be made irrespective of the rate of return earned on the property during the marriage.
[1] On the commingling exception:
See Dahl v. Dahl, 459 P.3d 276 (Utah 2015), 2015 UT 79
¶143 “Generally, premarital property, gifts, and inheritances [are considered] separate property, and the spouse bringing such … property into the marriage may retain it” in the event of a divorce. Keiter v. Keiter, 2010 UT App. 169, ¶ 22, 235 P.3d 782 (internal alterations omitted) (internal quotation marks omitted). But premarital property may lose its separate character where the parties have inextricably commingled it with the marital estate, or where one spouse has contributed all or part of the property to the marital estate with the intent that it become joint property. Dunn, 802 P.2d at 1320. Courts look to a party’s actions as a manifestation of a spouse’s intent to contribute separate property to the marital estate. Kimball v. Kimball, 2009 UT App. 233, ¶ 28, 217 P.3d 733.
JUDGE RYAN D. TENNEY authored this Opinion, in which JUDGES DAVID N. MORTENSEN and JOHN D. LUTHY concurred.
TENNEY, Judge:
¶1 James and Blanche Cox were married for over 20 years, during which time they had 10 children and acquired a large number of marital assets. In September 2012, Blanche filed for divorce.[1] After 4 years of pretrial litigation and then 14 days of trial, the district court issued a 35-page divorce ruling that settled various issues relating to child custody, child support, alimony, and the division of the marital estate.
¶2 James now appeals, arguing that many of the court’s rulings were not supported by adequate findings. We agree with James with respect to each challenged ruling. We accordingly vacate those rulings and remand for further proceedings.
BACKGROUND
¶3 James and Blanche Cox were married in 1990. During their marriage, they had 10 children and acquired a large number of assets. In September 2012, Blanche filed for divorce. After 4 years of litigation, the case went to trial, and that trial occurred over the course of 14 days between December 2016 and May 2017. In January 2017 (while the trial was proceeding), the court issued a bifurcated divorce decree granting Blanche’s request for a divorce and reserving other issues for further hearings and determinations.
The Ruling
¶4 In October 2017, the court issued a 35-page Ruling and Memorandum Decision (the Ruling) that entered findings of fact and legal determinations regarding many issues related to child custody, child support, alimony, and the valuation and division of the marital estate. This appeal implicates the court’s findings and determinations regarding essentially three groups of issues: the parties’ marital properties, alimony and child support, and marital debts.[2]
Marital Properties
¶5 The court found that James and Blanche “enjoyed the benefit or acquired” five properties during their marriage: (1) the Hildale Home, (2) the Henderson Home, (3) the Eagle Mountain Home, (4) the Rockville Property, and (5) the Cedar Highlands Lots. The court then entered findings and made rulings regarding how to divide the parties’ marital interest in each property.
¶6 The Hildale Home: The court found that James built this home (located, as our reference would suggest, in Hildale, Utah) before his marriage to Blanche. The court found that James, Blanche, and their children lived in this property until 2010, after which they moved to a different residence. The court heard testimony that title to the Hildale Home was held by the United Effort Plan Trust (the Trust). But the court then concluded that no evidence had been presented of the value of James’s interest in the Trust and that “establishing the value of a beneficial interest in property of the [Trust]” would be “practically and legally impossible.” The court acknowledged that Blanche had submitted an appraisal of the Hildale Home at trial (which, according to the record on appeal, estimated its value as being around $200,000), but the court concluded that the appraisal was deficient because it failed to account for costs and fees associated with the Trust ownership. From all this—and without any further explanation— the court then ruled that Blanche was “entitled to an award of $100,000” based on the home’s value.[3]
¶7 The Henderson Home: The court found that this home was purchased by James in 2004 for $420,000. It found that after the parties fell behind on mortgage payments, at which point they still owed around $288,000, the house was “lost in a short sale in 2013 for $225,000.” The court made a finding that the fair market value of the home at the time, according to Zillow, was $323,861.
¶8 But the court also heard competing testimony from the parties about whether the loss of the home could have been avoided. From Blanche, the court heard testimony that the home “could have been rented out” but that James refused to sign papers that would have modified the loan and, theoretically, allowed the parties to avoid losing it. From James, however, the court heard testimony that maintaining or leasing the home wasn’t actually possible for several different reasons.
¶9 From this, the court found that “[t]he parties would likely have had at least $100,000 in equity to split if they had kept” the Henderson Home and “rented it as suggested by [Blanche] numerous times.” The court then ruled that James “should be responsible to, and give [Blanche] credit for, $50,000 in equity representing her share of the lost asset dissipated by him.”
¶10 The Eagle Mountain Home: The court found that James and Blanche bought this home in 2009 and made a $120,000 down payment on it, $80,000 of which was borrowed from James’s mother. The court found that they moved into the home sometime in 2010 and began using it as their primary residence. James testified that he had at one point intended to sell the Eagle Mountain Home in an effort “to cover all the debts” on the parties’ credit cards but that Blanche refused to cooperate with him on the sale. Evidence presented at trial suggested that the home was sold in 2015 by a bankruptcy trustee for $520,000, with the parties still owing $292,000 at that time. Without citing any specific piece of evidence, the court found that if the Eagle Mountain Home had “not been lost to a forced sale, [Blanche] would have been able to receive at least another $25,000 today because of the current market value of $606,000,” and the court then ruled that she was “entitled to that sum.”
¶11 The Rockville Property: The court described this as a “7.5 acre parcel of farm property” located near Rockville, Utah. In its ruling on how to divide the marital interest in this property, the court referred to evidence it had received indicating that the parties were “forced to sell” the property for $270,000 after falling behind on the mortgage payments, as well as evidence showing that the parties still owed around $190,000 on the property when it was sold.
¶12 But the court then referred to several sources of evidence it had received that suggested that this property had a higher value and could have been sold for more. For example, it referred to evidence that a realtor had listed what the court thought was a similar 11.4 acre parcel for $1,195,000 (though the court then acknowledged that it was “debatable” whether this comparison provided an accurate valuation for the Rockville Property). The court also noted testimony that a realtor had valued the property at “approximately $900,000” due to “28 [shares of] water rights [that were] attached to it.” And the court referred to an “analysis from Zillow” that suggested the property’s value was $1,195,000.
¶13 From all this, the court then found that the forced sale of the property for $270,000 was a loss that “cost the parties at least $450,000 each,” and the court awarded Blanche “damages of $450,000 offset by monies she did receive in the amount of $42,000.”
¶14 The Cedar Highlands Lots: The Cedar Highlands Lots were “two lots down by Cedar City,” one of which was around 2 acres and the other around 2.5 acres. The court found that the lots were purchased for $40,000 each sometime in 2003 but that they were later “lost” through a forced sale because of the parties’ ongoing failure to pay various taxes and fees.
¶15 At trial, there was conflicting evidence and argument about the amount of the loss suffered by the parties because of the sale of these lots. James testified that the parties lost $60,000, while Blanche claimed that they lost somewhere between $153,000 and $280,000 (with her estimate being largely based on the lots’ appreciation in value since the time that the parties had purchased them—and, thus, the parties’ loss of potential equity by virtue of the forced sale). The court ultimately found that the parties’ inability to “pay the property taxes and Homeowners Association fees . . . resulted in [an] $80,000 loss to the parties.” The court did not explain how it had arrived at the $80,000 amount, nor did it explain how this loss was to be distributed between the parties.
Alimony and Child Support
¶16 Blanche’s Income: Under an initial subheading of the Ruling that was entitled “The Parties[’] Income,” the court found that Blanche is “an experienced bookkeeper with QuickBooks who has elected to be employed by About Faceology,” but that she was currently a “self employed Uber/Lift driver and has been so since 2015.” Under a subsequent subheading entitled “Income of the Parties,” however, the court then determined that “[f]or child support purposes [Blanche’s] income cannot be imputed at more than [the] minimum wage of $1,257 per month.” Elsewhere in the Ruling, and without explanation for the discrepancy, the court found that Blanche’s imputed minimum wage income was actually $1,260 per month (rather than $1,257). The court included no explanation for its conclusion that Blanche’s income could not be imputed at more than the minimum wage.
¶17 Child Support: At the time of the Ruling, the parties had five minor children. The court initially ordered James to pay $3,781 per month in child support. Elsewhere in the Ruling, however, and again without explanation, the court stated that it was ordering James to pay $3,336 per month in child support.
¶18 Alimony: Turning to alimony, the court noted that under the controlling statute, it should consider a number of factors. One of the factors it considered was Blanche’s “financial condition and needs.” With respect to this factor, the court opined that Blanche’s “needs have been overstated in her financial declarations,” but the court made no ruling about Blanche’s financial condition and what her needs actually were. With respect to Blanche’s earning capacity, the court again noted that Blanche “claim[ed] she earns just a little better than minimum [wage] even though she is an experienced and sophisticated bookkeeper with many years of experience having run, managed, overseen and monitored millions of dollars in income and expenses that ran through the parties[’] businesses.” But the court made no further findings about her particular earning capacity as it related to a potential alimony award. The court also noted that there were “minor children in the home,” five of whom were “younger than eighteen years of age or have not yet graduated from high school with their expected class.” But the court made no findings about how (or how much) these children impacted Blanche’s earning capacity. Finally, with respect to James’s ability to pay alimony, the court found that James was a “voluntarily under employed” electrician, and it then opined that “[t]here is no question that [Blanche] claims that her needs exceed hers and [James’s] monthly incomes.” Considering these factors together, the court then ordered James to pay $8,286 per month in alimony.
Marital Debts
¶19 Finally, the court made certain findings concerning the “business debt” that was “incurred” by the parties during the marriage. While the divorce proceedings were pending, James filed a Chapter 7 bankruptcy petition. In the Ruling, the court found that, after the bankruptcy proceedings had begun, James incurred $30,000 in debt while purchasing stock in his business and business-related property from the bankruptcy trustee. Since the court determined that Blanche was “entitled to 50% of [the] value” of the business, the court then concluded that she was entitled to an award of $15,000 as a result of this debt.
¶20 The court also noted that Blanche had “received financial compensation from the sale of assets and the conversion of assets into cash.” But the court opined that it was “difficult, if not impossible, to decipher whether each expenditure was personal, business related, or partially business-related.” From this, and without further explanation, the court awarded Blanche “judgment against [James] in the amount of $50,000.”
Motions for Clarification
¶21 James and Blanche were both dissatisfied with the Ruling, and in January 2018, they each filed a motion requesting clarification. Each motion raised a host of issues regarding alleged errors.
¶22 Of note here, in her motion, Blanche asked for clarification “as to whether or not” she was entitled to $25,000 for the Eagle Mountain Home or, instead, “another amount.” She argued that an award of $25,000 “seem[ed] incorrect mathematically” because if the fair market value of the Eagle Mountain Home was $606,000, and the home sold for $520,000, the “resulting equity would have been $86,000, which if divided equally would result in [Blanche] receiving judgment for $43,000,” as opposed to $25,000. Blanche also requested clarification as to the court’s determination “that the loss to the parties” concerning the Cedar Highlands Lots was $80,000. She argued that, based on the evidence presented at trial, the loss was $280,000. Blanche also requested clarification regarding the court’s determination of marital debts, specifically, whether the $15,000 was “to be added to the $50,000 for a total of $65,000” or whether “there [was] another number the court considered.” Finally, Blanche requested clarification of the court’s order regarding child support, given that in one portion of its Ruling the court ordered James to pay child support in the amount of $3,781 per month, and in another portion it altered that amount to $3,336 per month.
¶23 In his motion, James likewise requested clarification of various aspects of the Ruling. Among other things, he asked the court to “enter supplemental, amended, and or additional findings” regarding its ruling that Blanche was “entitled to $100,000” concerning the Hildale Home, explaining that he was “unaware of any evidence upon which the [court] could have relied in finding the $100,000 in equity the [court] awarded” Blanche. James also asked for clarification on the court’s findings concerning the Henderson Home, Eagle Mountain Home, and Rockville Property, asserting that the court had not “identified the facts upon which it relied” in making its calculations. Regarding the Henderson Home, James alleged that the court’s finding that “the parties would likely have had at least $100,000 in equity if the home had been rented” for the years 2013 through 2017 “fail[ed] to account for the costs of managing a rental property from a long distance, the likelihood of vacancies, the cost of utilities, maintenance, repairs, property taxes” and other related fees. Regarding the Eagle Mountain Home, James argued that the Ruling did not “accurately account for the additional $25,000” that Blanche received from the bankruptcy trustee “in addition to the $102,486.28 she received” from the sale. Regarding the Rockville Property, James requested clarification as to what facts the court relied upon to conclude that “the parties owned 28 shares of water,” given that the evidence “actually showed,” in his view, that they owned only 19 shares of water. Additionally, James requested clarification as to the court’s comparison of the Rockville Property to a parcel of “11.4 acre[s] of land with Virgin River frontage that was listed for $1,195,000.” Finally, with respect to the marital debts, James asked the court to “enter supplemental, amended and or additional findings” that would “identify the facts upon which [the court] relied in awarding [Blanche] $15,000 representing [the business’s] hypothetical equity or value.”
¶24 In the meantime, the Office of Recovery Services (ORS) intervened in the case based on its obligation to provide child support enforcement services. ORS filed a memo in response to Blanche’s motion for clarification in which it likewise requested clarification of the child support amount. After recounting its view of the evidence, ORS recommended that if Blanche’s income was imputed at minimum wage, and if James’s income was imputed at $18,500 per month, James should be ordered to pay $3,236 per month for the five minor children.
¶25 In August 2018, the court issued a ruling on James’s and Blanche’s motions. With respect to the child support amount, the court now ordered that James’s monthly obligation be $3,236 per month, thus apparently adopting ORS’s recommendation. With respect to the properties, the court now ruled—without explanation—that Blanche was entitled to $25,000 in relation to the Eagle Mountain Home and $40,000 for the Cedar Highland Lots. And with respect to the marital debts, the court found— again without explanation—that “[t]he $15,000 amount awarded is to be added to the $50,000 amount awarded for a total of $65,000” to be awarded to Blanche.
¶26 The court ordered Blanche’s counsel to prepare the final findings of fact and conclusions of law. In a November 2018 filing, however, Blanche alleged that she was unable to do so without “additional findings” regarding, among others, the marital debts. In May 2019, the court heard additional oral arguments. After the parties filed additional objections and motions, the case was reassigned from Judge Lynn Davis—who had heard the trial testimony and had issued both the Ruling and the rulings on the motions for clarification—to Judge Robert Lunnen. Judge Lunnen then heard oral arguments on the parties’ objections and outstanding motions.
The Supplemental Decree
¶27 In April 2021, the court (through Judge Lunnen) issued a “Supplemental Decree of Divorce” (the Supplemental Decree).[4]
¶28 The Supplemental Decree reiterated and incorporated many of the findings and determinations from the Ruling. As in the Ruling, for example, the court awarded Blanche $100,000 for the Hildale Home, $50,000 for the Henderson Home, and the (clarified) amount of $40,000 for the Cedar Highlands Lots. But without explanation, the court altered the order regarding the Eagle Mountain Home, awarding Blanche $43,000 as opposed to the $25,000 that was previously ordered. Also without explanation, the court altered the order regarding the Rockville Property, first concluding that Blanche’s offset should be $38,000, not $42,000, and now awarding Blanche $412,000 from this property as opposed to the $408,000 that had previously been awarded.
¶29 The court also determined that Blanche’s income should be imputed at minimum wage for a total of $1,260 per month. Based on its findings about the parties’ incomes, it then ordered James to pay $3,236 per month in child support, and it again ordered him to pay $8,286 per month in alimony.
¶30 Finally, the court awarded Blanche $65,000 relating to the marital debts. The court explained that $15,000 of that amount “represent[ed] her interest” in various purchases made by James from the bankruptcy trustee and that the remaining $50,000 represented “her interest in other assets, business and otherwise.”
¶31 James timely appealed.
ISSUE AND STANDARD OF REVIEW
¶32 James argues that the district court issued “inadequate” fact findings to explain its rulings regarding the marital properties, child support and alimony, and marital debts. “We review the legal adequacy of findings of fact for correctness as a question of law.” Lay v. Lay, 2018 UT App 137, ¶ 4, 427 P.3d 1221 (quotation simplified); see also Brown v. Babbitt, 2015 UT App 161, ¶ 5, 353 P.3d 1262 (“We review the legal sufficiency of factual findings—that is, whether the trial court’s factual findings are sufficient to support its legal conclusions—under a correction-of-error standard, according no particular deference to the trial court.” (quotation simplified)).[5]
ANALYSIS
¶33 A district court’s “[f]indings of fact are adequate . . . only when they are sufficiently detailed to disclose the steps by which the district court reached its ultimate conclusion on each issue.” Oldroyd v. Oldroyd, 2017 UT App 45, ¶ 5, 397 P.3d 645. When assessing a challenge to the adequacy of a district court’s findings, we look to whether the court “adequately disclosed the analytic steps” it took in reaching its conclusions. Keiter v. Keiter, 2010 UT App 169, ¶ 21, 235 P.3d 782. In this sense, the court’s findings of fact must show that its “judgment or decree follows logically from, and is supported by, the evidence.” Id. ¶ 17 (quotation simplified). “This obligation facilitates meaningful appellate review and ensures the parties are informed of the trial court’s reasoning.” Shuman v. Shuman, 2017 UT App 192, ¶ 5, 406 P.3d 258; see also Fish v. Fish, 2016 UT App 125, ¶ 22, 379 P.3d 882 (explaining that findings “are adequate when they contain sufficient detail to permit appellate review to ensure that the district court’s discretionary determination was rationally based”). While “unstated findings can be implied if it is reasonable to assume that the trial court actually considered the controverted evidence and necessarily made a finding to resolve the controversy, but simply failed to record the factual determination it made,” Fish, 2016 UT App 125, ¶ 22 (quotation simplified), we “will not imply any missing finding where there is a matrix of possible factual findings and we cannot ascertain the trial court’s actual findings,” Hall v. Hall, 858 P.2d 1018, 1025–26 (Utah Ct. App. 1993) (quotation simplified).
¶34 James argues that a number of the court’s findings were inadequate. His arguments address three groups of findings— namely, findings regarding (I) marital properties, (II) child support and alimony, and (III) marital debts. We address each group in turn.[6]
Marital Properties
¶35 James first challenges the adequacy of the findings that supported the rulings about how to value and distribute the parties’ marital properties. We recognize at the outset that district courts “have considerable discretion in determining property distribution in divorce cases.” Marroquin v. Marroquin, 2019 UT App 38, ¶ 11, 440 P.3d 757 (quotation simplified). But while a district court “does not have to accept [a party’s] proposed valuation” of an item in the marital estate, the court “does have to make findings sufficient to allow us to review and determine whether an equitable property award has been made.” Taft v. Taft, 2016 UT App 135, ¶ 53, 379 P.3d 890. In ruling on such a claim, we will uphold a district court’s “valuation of marital assets” if “the value is within the range of values established by all the testimony, and as long as the court’s findings are sufficiently detailed and include enough subsidiary facts to disclose the steps by which the ultimate conclusion on each factual issue was reached.” Wadsworth v. Wadsworth, 2022 UT App 28, ¶ 64, 507 P.3d 385 (quotation simplified), cert. denied, 525 P.3d 1259 (Utah 2022).
The Hildale Home
¶36 James first argues that the court’s findings regarding the Hildale Home were inadequate. In James’s view, the court “simply concluded that $100,000 was an appropriate amount of an award without providing factual findings” supporting “the appropriateness” of that award. We agree.
¶37 The court’s discussion of the Hildale Home spans roughly two pages of the Ruling. Much of the discussion concerns the ownership of the home. The court found that the home’s title is held by the Trust, that James’s interest in the home is that “of a beneficiary” to the Trust, and that Blanche, by contrast, is “not a legal beneficiary” of the Trust. But the court then found that “[n]o evidence was presented to the court of the value [of] [James’s] beneficial interest” in the Trust and that “establishing the value of a beneficial interest in property of the [Trust] is practically and legally impossible[,]” in part, because “the Trust is not receptive to, nor responsive to, legal inquiries.” The court also recognized that Blanche submitted an appraisal of the home, but it then concluded that the appraisal was not an adequate mechanism for establishing the home’s value because the appraisal failed to account for “title to the home being in the [Trust], the costs of getting the [Hildale Home] conveyed from the [Trust], or the thousands of dollars owed to the [court] appointed Trustee of the [Trust] which the Trustee is owed for administering the [Trust’s] assets.” After discounting its ability to rely on either James’s interest in the Trust or Blanche’s appraisal, the court ruled that the property was “a marital asset” to some “narrow extent.” Without further explanation, it then ruled that while it couldn’t grant title to Blanche, she was “entitled to an award of $100,000.”
¶38 We recognize the difficulties that the court faced with this trial in general—as should be clear by now, this was a very complicated divorce with a lot of things to decide and divide. And as evidenced by the preceding paragraph, the nature of parties’ apparent interest in the Hildale Home made the question of how to divide that interest particularly complicated. But even so, we see nothing in the Ruling that “adequately disclosed the analytic steps” the court took, Keiter, 2010 UT App 169, ¶ 21, when deciding that Blanche was entitled to $100,000. The court clearly explained what it thought it couldn’t rely on, but it didn’t explain what it thought it could rely on or how it arrived at this particular amount. Without such an explanation, James has no meaningful way to challenge that $100,000 award, nor do we have any meaningful way to assess whether it was legally warranted in light of the “matrix of possible factual findings” on this issue that are apparent from the record. Hall, 858 P.2d at 1025 (quotation simplified). We accordingly vacate this determination.
The Henderson Home
¶39 James next argues that the court “did not provide any analysis” as to how it determined there was $100,000 in equity in the Henderson Home and that, as a result, the $50,000 award to Blanche was based on inadequate findings. We agree.
¶40 The court found that the home was purchased by James in 2004 for $420,000. It explained that by August 2012, James and Blanche were “months behind in their [mortgage] payment” and that they owed $288,000 when the home was “lost in a short sale in 2013 for $225,000.” The court made a finding that the fair market value of the home at the time—according to Zillow—was $323,861.[7] The court found that James and Blanche “would likely have had at least $100,000 in equity to split if they had” managed to keep the home, but because James “ignored” Blanche’s suggestions to rent the home out, which in theory would have prevented them from losing it, it then ruled that James “should be responsible to, and give [Blanche] credit for, $50,000 in equity representing her share of the lost asset dissipated by him.” It appears the court thus based the $50,000 award on its finding that “the parties could likely have rented and made money as shown or just maintained [the Henderson Home] and sold it for profit presently.”
¶41 James’s initial argument here is that it’s unclear how the court arrived at the $100,000 in equity that it then divided. In response, Blanche suggests that this amount could have been derived from the court’s apparent acceptance of the home’s fair market value as being $323,861 (a value derived from Zillow— which, again, neither party has challenged on appeal as being improper), an amount that is approximately (though, we note, not precisely) $100,000 more than the parties received in the short sale. We have some concern that Blanche is asking us to do too much inferential work on our own, and we could vacate on this basis alone. But in any event, the court’s division of the apparent equity also seems to have been based on a dissipation (or, perhaps, a waste) determination stemming from James’s conduct. Assuming this was so, the court’s findings about James’s conduct, whether the home could actually have been rented out, what the parties could have received in rent, and whether this unspoken amount would actually have prevented them from losing the home were all either missing or decidedly cursory. We’ve previously held, however, held that when a court rules that a party “should be held accountable for the dissipation of marital assets,” the court must support the ruling with “sufficiently detailed findings of fact that explain the trial court’s basis” for that ruling, and we’ve also laid out a number of factors that “may be relevant to” and could support such a ruling. Rayner v. Rayner, 2013 UT App 269, ¶¶ 19–21, 316 P.3d 455 (quotation simplified). While that list is not mandatory or exhaustive, we still have an inadequate findings-based foundation here from which we could review what seems to have been an implicit dissipation determination. When coupled with the lack of explanatory findings about the basis for the equity determination, we conclude that the findings about this home are, as a whole, legally inadequate to support meaningful appellate review of this ruling. We accordingly vacate them.
The Eagle Mountain Home
¶42 James argues that the court’s findings regarding the Eagle Mountain Home were legally inadequate. We agree.
¶43 In the Ruling, the court (through Judge Davis) initially awarded Blanche $25,000 for this home. But the court failed to explain the analytic steps it took to arrive at that amount. The court did enter a few findings about this home—namely, that the parties made a $120,000 down payment when they purchased the home in 2009 ($80,000 of which was borrowed from James’s mother), that they were forced to sell it in 2015 in conjunction with James’s bankruptcy, and that, as a result of that sale, Blanche received “one half” of its equity. But the court made no findings about the sale price or how much equity the parties had in the home at the time of the sale. And then, without any explanation, the court opined that “[h]ad it not been lost to a forced sale,” Blanche “would have been able to receive at least another $25,000 today” because of the home’s “current market value.” The court provided no basis for the $25,000 amount, and we see no reasonable basis in its findings for inferring one.
¶44 Of note, the court (through Judge Lunnen) then changed the awarded amount in the Supplemental Decree, now awarding Blanche $43,000 for it. But the court didn’t explain why it increased this award from the award that had previously been entered in the Ruling. And while Blanche suggests on appeal that the court had now accepted a new valuation of the home that she offered in her motion for clarification, the court never said that it was doing so, nor did it provide any other explanation for why it increased this award at all, let alone by this particular amount.
¶45 In light of this procedural history, it’s unclear to us what analytic steps led the court to first award Blanche $25,000 for this home and what caused the court to later change that award to $43,000. As a result, the findings with respect to this home are legally inadequate and are therefore vacated.
The Rockville Property
¶46 James argues that the court’s findings about the Rockville Property are legally inadequate because it’s “not clear” how the court “reached its valuation of the Rockville Property” or how it divided that value as part of its division of the marital estate. We agree.
¶47 In the Ruling, the court explained that the Rockville Property was a “7.5 acre parcel of farm property” owned by James and Blanche near Rockville, Utah. As for its value and how to determine that value, the court pointed to three options: (1) it noted that a realtor had listed a similar 11.4 acre parcel for $1,195,000, though the court opined that this valuation was “debatable”; (2) the court noted that Blanche “discussed” its value with a realtor who “indicated back then” (which, though unsaid by the court, seems from context to have been in 2013) that the “lot was worth approximately $900,000, due to the 28 water rights attached to it”; and (3) the court pointed to a “[c]urrent market value analysis from Zillow” that “estimate[d]” the property’s value at $1,195,000. The court then found that the parties were “forced to sell” the property in December 2013 for $270,000 due to financial troubles. And the court apparently faulted James for this, determining that at the time of the forced sale, the parties “only owed approximately $190,000” on the property, that it could have been refinanced, and that it was James’s fault that they did not do so. From this, the court found that the forced sale “cost the parties at least $450,000 each,” and it accordingly awarded Blanche “damages of $450,000 offset by monies she did receive in the amount of $42,000.”
¶48 From an adequacy-of-the-findings perspective, the initial problem here is that the court never stated whether it was accepting $1,195,000 or $900,000 as the property’s value. Given that the property’s value would be the numerator for any division of it as a marital asset, this omission is, of course, significant. And while Blanche invites us to engage in some loose math that would account for both possibilities and arrive at the same endpoint, the difference between the two initial valuations might matter if James wished to mount a sufficiency of the evidence challenge. Moreover, to the extent that the court’s determination about how to divide the property’s value turned on an implicit dissipation determination, we again note that the court failed to support such a determination with adequate findings. And finally, while the court offset the award to Blanche by “monies she did receive in the amount of $42,000,” an amount that it later changed to $38,000 in the Supplemental Decree, the court didn’t explain the basis for either amount in either ruling.[8]
¶49 Given the unanswered questions about how the court valued both this property and the offset, we have no basis for conducting a meaningful review of this award. We accordingly vacate it.
The Cedar Highlands Lots
¶50 James’s final property-related challenge is to the findings regarding the Cedar Highlands Lots. In James’s view, the court improperly failed to “indicate . . . how the $80,000 was calculated.” We again agree.
¶51 In the Ruling, the court found that James and a business partner had purchased the two lots for $40,000 each, that Blanche had “controlled the book-keeping for the marital businesses,” and that the lots “were lost when the parties were unable or could not pay the property taxes and Home Owners Association fees,” thus “result[ing] in [an] $80,000 loss to the parties.” In a subsequent ruling, the court determined that this loss should now result in an award of $40,000 to Blanche, and that award was later confirmed in the Supplemental Decree.
¶52 From the court’s findings, it’s unclear why the court determined that there was an $80,000 loss. The court seems to have assumed that the lots were completely lost with no return in value, but the court never said so. And more importantly, even assuming that this was the implicit finding, the court never explained why it concluded that Blanche should receive an award of $40,000 as the result of this particular loss to the marital estate of $80,000. Without such an explanation, we have no meaningful basis for reviewing the ruling. As a result, we vacate it.
Child Support and Alimony
¶53 James challenges the adequacy of the findings relating to child support and alimony. James’s challenges here fall into two groups: first, he challenges the adequacy of the findings relating to Blanche’s income (which, as explained below, matter to both child support and alimony); and second, with respect to the alimony determination, he challenges the adequacy of the court’s findings relating to Blanche’s financial condition and needs.
Blanche’s Income
¶54 James argues that the court’s findings regarding Blanche’s income were inadequate because they failed to “provide any reasoning for disregarding [Blanche’s] earning capacity.” We agree.
¶55 A party’s income matters to a determination of both child support and alimony. First, with respect to child support, a “noncustodial parent’s child support obligation is calculated using each parent’s adjusted gross income.” Twitchell v. Twitchell, 2022 UT App 49, ¶ 34, 509 P.3d 806 (quotation simplified); see also Utah Code §§ 78B-12-202, -301 (establishing guidelines for child support awards). Importantly, the court “is required to enter detailed and specific findings on all material issues which must be considered when making a child support award.” Breinholt v. Breinholt, 905 P.2d 877, 881 (Utah Ct. App. 1995) (quotation simplified). But “so long as the steps by which the ultimate conclusion on each factual issue was reached are apparent, a trial court may make findings, credibility determinations, or other assessments without detailing its justification for finding particular evidence more credible or persuasive than other evidence supporting a different outcome.” Shuman, 2017 UT App 192, ¶ 6 (quotation simplified). Second, with respect to alimony, a court must examine, among other factors, “the recipient’s earning capacity or ability to produce income.” Miner v. Miner, 2021 UT App 77, ¶ 16, 496 P.3d 242 (quotation simplified). And a court must in “all cases . . . support its alimony determinations with adequate findings . . . on all material issues,” and “failure to do so constitutes reversible error, unless pertinent facts in the record are clear, uncontroverted, and capable of supporting only a finding in favor of the judgment.” Id. ¶ 17 (quotation simplified).
¶56 Of note, when “there is insufficient evidence of one of the statutory alimony factors, courts may impute figures.” Gardner v. Gardner, 2019 UT 61, ¶ 98, 452 P.3d 1134 (quotation simplified). For example, a “court may impute income to a former spouse for purposes of calculating alimony after finding that the former spouse is voluntarily unemployed or voluntarily underemployed.” Fish, 2016 UT App 125, ¶ 15. And it “is not unusual for courts to impute income to a spouse who has not worked during the marriage (or who has not worked for a number of years preceding the divorce) but who is nevertheless capable of producing income.” Petrzelka v. Goodwin, 2020 UT App 34, ¶ 26, 461 P.3d 1134 (emphasis in original). But when a court imputes income, the “imputation cannot be premised upon mere conjecture; instead, it demands a careful and precise assessment requiring detailed findings.” Christensen v. Christensen, 2017 UT App 120, ¶ 22, 400 P.3d 1219 (quotation simplified); see also Reller v. Argenziano, 2015 UT App 241, ¶ 33, 360 P.3d 768 (“Before imputing income to a parent, the trial court must enter findings of fact as to the evidentiary basis for the imputation.” (quotation simplified)).
¶57 Income can likewise be imputed as part of a child support determination. See Utah Code § 78B-12-203(8). But, as with an alimony award, a court must support such an imputation with adequate findings. See id. § 78B-12-203(8)(a) (explaining that in contested cases, “[i]ncome may not be imputed to a parent unless,” after an evidentiary hearing on the matter, the court “enters findings of fact as to the evidentiary basis or the imputation”); id. § 78B-12-203(8)(b) (detailing the evidentiary bases upon which a court may impute income for child support purposes); see also Rayner, 2013 UT App 269, ¶ 10 (“Imputation cannot be premised upon mere conjecture; instead, it demands a careful and precise assessment requiring detailed findings.” (quotation simplified)).
¶58 Here, the court determined that although Blanche was currently working as a “self employed Uber/Lift driver,” her “income cannot be imputed at more than minimum wage of $1,257 per month.” In a different portion of the Ruling, however, the court found that Blanche’s “gross income” should actually be imputed at “$1,260 per month.”
¶59 On appeal, James doesn’t focus on this three-dollar discrepancy. Rather, James argues that the court erred by failing to explain why Blanche’s income should be imputed at minimum wage at all. As James points out, the court elsewhere found that Blanche is “an experienced bookkeeper with QuickBooks who has elected to be employed by About Faceology,” and it further found that she was “an experienced and sophisticated bookkeeper with many years of experience having run, managed, overseen and monitored millions of dollars in income and expenses that ran through the parties[’] businesses.”
¶60 Having reviewed the Ruling, we see no explanation for the court’s determination that, although Blanche is an experienced bookkeeper with the skill set to manage millions of dollars in income for a company, her income should still be imputed at minimum wage. In an attempt to justify this on appeal, Blanche points to a passing statement from the alimony portion of the ruling in which the court noted that the parties “have ten children, five of which are younger than eighteen years of age or have not yet graduated from high school with their expected class.” But as James points out in response, the parties had even more minor children at home during the years in which Blanche was working as a bookkeeper with responsibilities for “millions of dollars in income.” And while it’s possible that the court believed that something had now changed that would prevent Blanche from still doing this work (such as her new status as a post-divorce single parent), the court never said this or entered any findings to support such a determination, it never explained why it was implicitly determining that Blanche could work as an Uber/Lyft driver but not as a bookkeeper, and it entered no findings to explain why her current employment as an Uber/Lyft driver would result in an income imputation of minimum wage.
¶61 To be clear: as with the other issues in this appeal, we express no opinion about the proper resolution of any of these questions. But without an explanation from the district court, James has no basis for properly challenging the decision about Blanche’s income, nor do we have an adequate basis for reviewing it. Given the importance of Blanche’s income to both child support and alimony, we accordingly vacate those rulings.
Blanche’s Financial Condition and Needs
¶62 As part of its alimony determination, the court was also required to consider Blanche’s “financial condition and needs.” Miner, 2021 UT App 77, ¶ 16 (quotation simplified). James argues that the court failed to enter adequate findings to support this assessment. We agree.
¶63 In the Ruling, the court noted that Blanche had claimed that she had “monthly needs of $18,565,” but it then concluded that these needs were “overstated.” And while Blanche had also suggested that she needed the alimony award to account for “over $200,000 in credit card and business debts,” the court suggested that this debt was either accounted for by other portions of its ruling or had “been discharged in the bankruptcy case.”
¶64 But even so, while the court then concluded that James “simply does not make sufficient money to satisfy all of [Blanche’s] claims” about what “she reasonably needs to support herself,” the court did not make any determination about what Blanche’s needs actually are. As James correctly points out, the absence of such an explanation prevents us from conducting a meaningful review of how this factor should weigh into the court’s alimony award, a problem that is compounded by the failure discussed above to adequately explain its determination about Blanche’s income.
¶65 We accordingly vacate the alimony award to allow the court to enter more detailed findings and, “if necessary, recalculat[e] . . . appropriate alimony.” Fitzgerald v. Fitzgerald, 2005 UT App 67U, para. 6 (quotation simplified); see also Eberhard v. Eberhard, 2019 UT App 114, ¶¶ 39–40, 449 P.3d 202 (faulting a district court for not “spelling out” “how much more [the petitioner] actually needs each month to pay down her debt and elevate herself to the marital standard of living,” thus leaving the appellate court “unable to discern whether the alimony award, in fact, exceeds her needs”).
III. Marital Debts
¶66 Finally, James challenges the adequacy of the court’s findings with respect to the parties’ marital debts. We agree that these findings are inadequate.
¶67 “In issuing a divorce decree, a trial court must include an order specifying which party is responsible for the payment of joint debts, obligations, or liabilities of the parties contracted or incurred during marriage.” Fox v. Fox, 2022 UT App 88, ¶ 32, 515 P.3d 481 (quotation simplified), cert. denied, 525 P.3d 1263 (Utah 2022); see also Utah Code § 30-3-5(3)(c)(i). Utah law “requires only a fair and equitable, not an equal, division of the marital debts.” Fox, 2022 UT App 88, ¶ 32 (quotation simplified). A district court is in the “best position to weigh the evidence, determine credibility and arrive at factual conclusions”; as a result, a district court’s division of marital debts is “entitled to a presumption of validity.” Mullins v. Mullins, 2016 UT App 77, ¶ 20, 370 P.3d 1283 (quotation simplified). But, again, the district court must enter findings of fact that are “sufficiently detailed to disclose the steps by which [it] reached its ultimate conclusion on each issue.” Oldroyd, 2017 UT App 45, ¶ 5.
¶68 Here, the court found that the “parties incurred business debt while married.” James challenges the adequacy of the findings with respect to two of those debts.
¶69 First, the court found that as a result of James’s bankruptcy, James took on $30,000 in debt to finance the purchase of his business’s stock and other business-related property. In the court’s view, Blanche was “entitled to 50% of [the] value” of the business, which meant, in its view, that she was also entitled to $15,000. But the court never explained why it concluded that Blanche was entitled to this amount. While it’s possible, as Blanche now suggests, that the court thought that James had drawn the $30,000 from marital assets—and, thus, that $15,000 of it belonged to Blanche—the court didn’t say this, and its reference to this as “$30,000” in “debt” that James had incurred is somewhat at odds with this inference. In the absence of any explanation, we vacate this ruling.
¶70 Second, at the close of the “Marital Debts” section of its ruling, the court found that Blanche had “received financial compensation from the sale of assets and the conversion of assets into cash.” But it then opined that it was “difficult, if not impossible, to decipher whether each expenditure was personal, business related, or partially business-related.” Without any further explanation, the court then held that Blanche
was “awarded judgment against [James] in the amount of $50,000.”
¶71 It’s entirely unclear to us what the basis for this $50,000
award was. So far as we can tell, the court seems to have concluded that Blanche had already received some prior distributions from marital assets and that she should now receive $50,000 more. But there’s no explanation for how the court arrived at this particular amount, what the amount was linked to, or why it would be listed alongside an analysis of “Marital Debts.” Without any such explanation, we vacate this award.
CONCLUSION
¶72 We agree with James’s assertion that the challenged findings were not legally adequate and that these inadequacies impaired both his ability to challenge the court’s various rulings and our ability to review them. We accordingly vacate the above rulings and remand the case with instructions for the court to enter more detailed findings and then alter any of its rulings as may be necessary.
[1] Because the parties share the same last name, we’ll follow our normal practice and refer to them by their first names, with no disrespect intended by the apparent informality.
[2] In this Background, we’ll recount the main findings regarding each ruling at issue on appeal, but in some instances, additional relevant findings will be discussed in the Analysis below.
[3] With respect to some (though not all) of the dollar amounts included in the rulings at issue, the court added “.00” signifiers. For readability, those have been omitted throughout this opinion.
[4] As noted above, the court had previously entered a bifurcated divorce decree while the trial on the parties’ assets and the like was still ongoing.
[5] As evidenced by the passages quoted above, there’s something of a disconnect in how we’ve referred to this kind of argument in past cases. In some cases, we’ve described it as an argument about the “legal adequacy” of the district court’s findings, see, e.g., Lay v. Lay, 2018 UT App 137, ¶ 20, 427 P.3d 1221, but in others, we’ve described it as an argument about the “legal sufficiency” of the findings, see, e.g., Brown v. Babbitt, 2015 UT App 161, ¶ 5, 353 P.3d 1262. For consistency’s sake, it might be better if bench and bar alike settled on a single usage. And on reflection, we suggest that such an argument should be described in adequacy terms.
The reason for this is to reduce the potential for confusing this kind of argument with the similar sounding but substantively distinct “sufficiency of the evidence” argument. At the risk of over-simplification: a sufficiency of the evidence argument asserts that there was insufficient evidentiary support for a particular factual finding. As detailed more fully below, however, the argument at issue here—a challenge to the adequacy of the findings—asserts that the court’s findings did not adequately explain the basis for the court’s rulings, thereby impairing our ability to review those rulings (for sufficiency of the evidence or anything else).
[6]Two notes are warranted at the outset—one about our usage patterns regarding the rulings at issue, and one about a threshold argument made by Blanche.
First, as discussed above, there are two decisions that largely drive the various arguments in this case: the Ruling and the Supplemental Decree. The Ruling was issued by Judge Davis, who heard the trial evidence, while the Supplemental Decree was issued by Judge Lunnen, who was assigned to the case after the Ruling was issued. At one of the hearings in the intervening period, Judge Lunnen responded to a party’s argument by stating that “[t]he findings, they’re set in stone. So all this is . . . a result of the findings.” As noted, however, Judge Lunnen did alter a few of the Ruling’s legal determinations in the Supplemental Decree. In consequence of how this all played out, the Supplemental Decree recites many of the findings that were issued in the Ruling, though not with the same level of detail. It instead essentially incorporates the bulk of the Ruling by implicit reference. For this reason, the parties’ arguments on appeal have largely focused on whether the findings from the Ruling were adequate, and we’ll follow suit. To avoid redundancy, we won’t repeatedly mention whether we think the findings from the Supplemental Decree were likewise inadequate (even if they were reiterated in the Supplemental Decree); instead, we’ll discuss the Supplemental Decree only in those instances where it differs in some meaningful way from the Ruling (usually because of an altered legal determination).
Second, in her opening brief, Blanche argues that James did “not comply with Utah’s marshaling requirement” in his briefing on appeal. But the marshaling requirement applies when a party “seeks to prevail in challenging the sufficiency of the evidence to support a factual finding or a verdict on appeal.” State v. Nielsen, 2014 UT 10, ¶ 40, 326 P.3d 645; see also State v. Wall, 2020 UT App 36, ¶ 53, 460 P.3d 1058; Wilson v. Sanders, 2019 UT App 126, ¶ 17, 447 P.3d 1240. As noted, however, James is not arguing that there was insufficient evidence to support any particular finding. Rather, James is arguing that the findings were inadequate to explain the court’s various rulings. As we’ve explained, an argument about the adequacy of the findings presents a legal question. Because of this, “marshaling is not required.” Jensen v. Jensen, 2009 UT App 1, ¶ 8 n.3, 203 P.3d 1020; see also Woodward v. Fazzio, 823 P.2d 474, 477–78 (Utah Ct. App. 1991) (“There is, in effect, no need for an appellant to marshal the evidence when the findings are so inadequate that they cannot be meaningfully challenged as factual determinations. . . . Rather, appellant can simply argue the legal insufficiency of the court’s findings as framed.”).
[7] While a topic at oral argument, neither party raised on appeal the issue of whether the district court could appropriately rely on Zillow for its valuation of the property, as opposed to evidence submitted at trial. For this reason, we do not address the issue here.
[8] It seems possible (if not probable) that this offset was intended to reflect a determination that the parties received $80,000 in equity when they sold the property for $270,000 while still owing $190,000 on it. But if this was the determination, (1) the court didn’t say so, and (2) it also didn’t explain the basis for initially deviating upward by $2,000 to arrive at $42,000, nor did it explain the basis for subsequently deviating downward by $2,000 to arrive at $38,000.
Cassie J. Medura and Jarrod H. Jennings, Attorneys for Appellant
Douglas B. Thayer and Mark R. Nelson, Attorneys for Appellee
JUDGE GREGORY K. ORME authored this Opinion, in which
JUDGES MICHELE M. CHRISTIANSEN FORSTER and RYAN D. TENNEY concurred.
ORME, Judge:
¶1 Thomas E. Mower and Lidia V. Mower stipulated to a bifurcated divorce in which the district court dissolved their marriage but reserved for trial all other issues, which were the subject of contentious litigation. Thomas died after the trial concluded but shortly before the court issued its ruling that would have resolved all but one issue. As a result of Thomas’s death, the court held that it no longer had jurisdiction over the divorce action and closed the case, indicating that Lidia could pursue any surviving claims in probate court against Thomas’s estate.[1]
¶2 On appeal, Lidia argues that the court erroneously concluded that the unresolved claims in the divorce action abated on Thomas’s death. Thomas’s son, Thomas W. Mower (Thomas Jr.), in his capacity as special administrator of the Estate of Thomas E. Mower, by special appearance represents his late father’s interests on appeal. See generally Utah R. App. P. 38(a), (c). We hold that under the facts of this case, Thomas’s death did not deprive the court of jurisdiction to resolve most of the unresolved claims. Accordingly, we reverse and remand.
BACKGROUND
¶3 Thomas and Lidia married in 2001. Lidia initiated divorce proceedings in 2012. The ensuing litigation was very contentious and involved complex issues including grounds for divorce, a request for a retroactive increase in alimony,[2] custody of and parent-time with their child born during the marriage, child support, the potential equitable division of a large estate that was arguably “worth upwards of $150,000,000,”[3] and attorney fees.
¶4 In May 2013, on the parties’ stipulation, the district court entered a bifurcated decree of divorce, dissolving the parties’ marriage but reserving all other issues for trial. The court ruled that it would “value the estate as of the date this divorce decree enters rather than at the day of trial” and that “[a]ll other issues of dispute will remain open for further resolution by the Court.” Following entry of the bifurcated divorce decree, both parties remarried.
¶5 Four and a half years later, the bench trial in this case, which “included voluminous exhibits and witness testimony,” was held over the course of sixteen days between November 2017 and December 2018. Although the matter came under advisement awaiting a final ruling in January 2020, the district court “held status conferences to work through issues as they arose,” with the most recent one being held in July 2020.
¶6 Thomas passed away on August 2, 2020. The following day, the district court issued a ruling stating it would close the divorce action in twenty days unless it received a valid objection and a supporting memorandum. Lidia objected, filing a Motion for Entry of Final Property Division and a Rule 25 Motion to Substitute Party. Regarding the latter motion, Lidia requested that “the personal representative or other appropriate party” be substituted in the divorce action “to allow the Court to issue a final ruling regarding property settlement and all outstanding financial issues in this case.” See generally Utah R. Civ. P. 25(a)(1) (“If a party dies and the claim is not thereby extinguished, the court may order substitution of the proper parties.”). Thomas’s counsel opposed Lidia’s objection and motions.[4]
¶7 In February 2021, following argument on the issues, the court overruled Lidia’s objection and denied her motions. The court first stated that shortly before Thomas’s death, it had completed “its findings of fact and was prepared to issue a ruling reserving only a single outstanding issue that [it] intended to invite the parties to address via supplemental briefing.” Despite this, following a lengthy discussion of Porenta v. Porenta, 2017 UT 78, 416 P.3d 487, the court held that its prior orders regarding child support, parent-time, and custody abated upon Thomas’s death and that Lidia, as the surviving party in a bifurcated divorce, was required “to pursue unresolved equitable claims to marital property before a probate court.” A few months later, the court issued a Final Order, stating, “Due to the untimely death of [Thomas], this court no longer has jurisdiction over this matter and this matter is closed.” ¶8 Lidia appeals.
ISSUE AND STANDARD OF REVIEW
¶9 Lidia argues that the court erred in closing the divorce action on the ground that Thomas’s death caused it to lose jurisdiction.[5] “We review a court’s determination of jurisdiction for correctness, granting no deference to the lower court.” In re S.W., 2017 UT 37, ¶ 7, 424 P.3d 7.
ANALYSIS
¶10 In concluding that Thomas’s death caused it to lose jurisdiction over the divorce action, the district court relied heavily on our Supreme Court’s opinion in Porenta v. Porenta, 2017 UT 78, 416 P.3d 487. In that case, during the pendency of a divorce action, the husband executed a quitclaim deed transferring his interest in the marital home to his mother in an effort to prevent the home from being distributed as part of the marital estate. Id. ¶¶ 2–3. The husband thereafter died, causing the district court to dismiss the divorce case for lack of jurisdiction. Id. ¶ 5. The wife then sued the mother, seeking to set aside the quitclaim deed under the Utah Fraudulent Transfer Act (the UFTA). Id. ¶ 6. The district court in that case ultimately ruled that the husband’s transfer of his interest in the home to his mother was fraudulent under the UFTA. Id. ¶ 8.
¶11 The mother appealed, arguing that the wife’s claim was barred because the UFTA requires an ongoing debtor-creditor relationship at the time a claim under the act is filed, which relationship the husband’s death had extinguished. Id. ¶ 9. Specifically, the mother argued that the wife’s claim against the husband “for the whole of the marital estate, including the right to preserve the joint tenancy” in the marital home, id. ¶ 14 (quotation simplified), became unenforceable when the husband died because one “cannot bring a claim against a dead person” and because “court orders that award a spouse with property abate upon the death of a spouse,” id. ¶ 16. See generally id. ¶ 12 (“The existence of a claim, or right to payment, is at the heart of the debtor-creditor relationship.”); id. ¶ 19 (“A claim for equitable distribution arises when one party in a marriage threatens divorce.”).
¶12 Quoting its prior decision in In re Harper’s Estate, 265 P.2d 1005 (Utah 1954), our Supreme Court reaffirmed that
when the death of one of the parties occurs after the entry of a divorce decree and before the decree is final the decree becomes ineffective to dissolve the marriage, death having terminated that personal relationship. However, the occurrence of death does not abate the action itself and to the extent that property rights are determined by the decree it remains effective and becomes final.
Porenta, 2017 UT 78, ¶ 20 (quotation simplified). See id. ¶ 28 (reaffirming the precedent set forth in In re Harper’s Estate). In other words, the Court held that “[t]he death of a spouse during a divorce proceeding abates the action concerning the dissolution of marriage, but it does not abate the action itself when certain property rights have been determined by the court.”[6]See id. ¶ 26 (quotation simplified). Conversely, “all interlocutory orders that are effective only during litigation,” such as orders restraining the parties from selling property or dissipating the marital estate, “abate upon the dismissal of a divorce case.” Id. ¶ 27. The court noted that this was in line with “the general rule followed in virtually all jurisdictions . . . that, after one of the spouses dies during a divorce proceeding, and during the time an appeal is pending or during the time when an appeal may be taken, a divorce or dissolution action abates with respect to marital status of the parties but does not abate with respect to property interests affected by the decree.” Id. ¶ 20 (quotation simplified).
¶13 Finally, the Court held that “[c]laims that survive the death of a party are typically chargeable against that party’s estate” and cited rule 25(a)(1) of the Utah Rules of Civil Procedure as a means through which to pursue such claims. Id. ¶ 30. See Utah R. Civ. P. 25(a)(1) (“If a party dies and the claim is not thereby extinguished, the court may order substitution of the proper parties.”). Because the Court presumed that the wife’s “claim for the whole of the marital estate, including the right to preserve the joint tenancy” in the marital home was not extinguished and was still valid,[7] it held that “a debtor-creditor relationship existed between Husband’s estate and Wife at the time Wife filed her UFTA claim.” Id. ¶ 36 (quotation simplified).
¶14 In sum, as relevant to the issue presented in the current appeal, Porenta provides three major takeaways. First, if a spouse dies prior to entry of a final divorce decree, the marriage no longer requires dissolution because death already “terminated that personal relationship.” Id. ¶ 20 (quotation simplified). See 27A C.J.S. Divorce § 194 (2022) (“A cause of action for divorce is purely personal, ends on the death of either spouse, and does not survive for the benefit of a third party.”); 24 Am. Jur. 2d Divorce and Separation § 118 (2022) (“[A] divorce suit abates when one party dies while the suit is pending and before a decree on the merits, because the death terminates the marriage, thus rendering the divorce suit moot as it relates to the parties’ marital status.”). Second, court orders entered prior to the final divorce decree determining the property rights of the parties do not abate on the spouse’s death. See Porenta, 2017 UT 78, ¶ 20. However, any “interlocutory orders that are effective only during litigation abate upon the dismissal of a divorce case.” Id. ¶ 27. See id. ¶ 27 n.13 (“This is not unique to the area of divorce law. Interlocutory orders that expressly expire at the end of litigation do just that, regardless of the type of case or how the litigation finally ends.”). And third, certain unresolved claims or rights arising from a divorce action may still be pursued following the spouse’s death. See id. ¶ 36. See also 24 Am. Jur. 2d Divorce and Separation § 118
(“[G]iven the circumstances presented, a portion of the dissolution action may survive an abatement of the rest of the action.”).
¶15 Regarding the third point, because the issue had not been adequately briefed, the Porenta Court specifically declined to address “[w]hether a claim for equitable distribution or some other property claim survives the death of a spouse during a divorce proceeding,” Porenta,2017 UT 78, ¶ 17, which the Court characterized as “an issue of first impression in Utah,” id. ¶ 28. Put differently, although the Court held that a district court’s orders determining the parties’ property rights do not abate upon a spouse’s death, it declined to determine whether the same was true for unresolved claims for equitable distribution or other property claims. In any event, the case before us is on a different footing, which likewise does not necessitate that we address that specific issue.
¶16 Unlike in Porenta, Thomas died after the district court entered a bifurcated divorce decree dissolving the parties’ marriage but leaving all unresolved issues for a trial that ultimately would not be held for several more years. See generally Utah R. Civ. P. 42(b) (“The court in furtherance of convenience or to avoid prejudice may order a separate trial of any claim, cross claim, counterclaim, or third party claim, or of any separate issue or of any number of claims, cross claims, counterclaims, third party claims, or issues.”). Accordingly, because Thomas and Lidia’s marriage had already been dissolved at the time of Thomas’s death, we need not address the effect the death of a spouse has on the underlying claim for equitable distribution of the marital estate in the situation where the parties are still legally married at the time of the death.
¶17 Rather, the issue before us is more straightforward. As previously discussed, the reason a divorce action generally abates upon the death of a party is because the death already “terminated that personal relationship,” Porenta, 2017 UT 78, ¶ 20 (quotation simplified), thereby “rendering the divorce suit moot as it relates to the parties’ marital status,”[8] 24 Am. Jur. 2d Divorce and Separation § 118. But here, the parties stipulated to a bifurcated divorce, and their marriage had been dissolved several years prior to Thomas’s death. Indeed, both Thomas and Lidia had remarried. For that reason, unlike in Porenta, Thomas’s death had no legal effect on the parties’ already dissolved marriage and therefore the ground on which the divorce action discussed in Porenta abated—i.e., mootness—is not present here.
¶18 Utah courts regularly use bifurcation under rule 42(b) of the Utah Rules of Civil Procedure “to allow divorcing spouses to more expeditiously obtain a divorce before embarking upon the sometimes more complex and time-consuming tasks of determining property division and deciding matters of support.” Parker v. Parker, 2000 UT App 30, ¶ 8, 996 P.2d 565. It is uncontested that a district court’s jurisdiction “to enter equitable orders relating to the property belonging to the marital estate” is unaffected by the bifurcation. Porenta, 2017 UT 78, ¶ 19 (quotation simplified). See Utah Code Ann. § 30-3-5(2) (LexisNexis Supp. 2022). Indeed, the Utah Constitution directs, “The district court shall have original jurisdiction in all matters except as limited by this constitution or by statute[.]” Utah Const. art. VIII, § 5. See Utah Code Ann. § 78A-5-102(1) (LexisNexis Supp. 2022) (“Except as otherwise provided by the Utah Constitution or by statute, the district court has original jurisdiction in all matters civil and criminal.”). Furthermore, divorce courts are generally “well
¶19 Here, because the parties’ marriage was already dissolved prior to Thomas’s death, mootness—a jurisdictional bar, see State v. Legg, 2016 UT App 168, ¶ 25, 380 P.3d 360—does not apply to most of the claims at issue.[9] Because no other constitutional or statutory bar to the district court’s jurisdiction exists in the case before us, the district court erred in determining that it lacked jurisdiction over all of the claims that remained at issue and in dismissing the divorce action on that ground. See Estate of Burford v. Burford, 935 P.2d 943, 955 (Colo. 1997) (stating that when one party to a divorce proceeding died following dissolution of the parties’ marriage in a bifurcated divorce, “the dissolution action did not abate, and the district court properly maintained jurisdiction over the marital estate to conduct hearings to resolve financial matters raised in the dissolution proceedings”); Fernandez v. Fernandez, 648 So. 2d 712, 714 (Fla. 1995) (agreeing “that the trial court maintained jurisdiction to enter the final judgment determining the parties’ property rights subsequent to the wife’s death” where the court had dissolved the marriage prior to her death); Barnett v. Barnett, 768 So. 2d 441, 442 (Fla. 2000) (per curiam) (“[T]he death of a party after entry of a written, signed judgment of dissolution but prior to the rendition of a decision on a timely motion for rehearing concerning matters collateral to the adjudication of dissolution did not affect the dissolution decree or divest the court of jurisdiction to decide the remaining issues between the parties.”); 27A C.J.S. Divorce § 194 (“Once a decree in divorce is granted and, thereafter, one of the parties dies, the court can continue with the equitable distribution of marital property.”).
¶20 In cases such as this, in which “a party dies and the claim is not thereby extinguished, the court may order substitution of the proper parties.” Utah R. Civ. P. 25(a)(1). See Porenta, 2017 UT 78, ¶ 30 (stating that “[c]laims that survive the death of a party are typically chargeable against that party’s estate” and citing rule 25(a)(1) of the Utah Rules of Civil Procedure as a means through which this may be achieved). But whether to substitute a party remains within the district court’s discretion. See Bradburn v. Alarm Prot. Tech., LLC, 2019 UT 33, ¶ 8, 449 P.3d 20 (“A district court’s substitution ruling is a discretionary one[.]”). Additionally, as Thomas Jr. points out, the district court “has inherent discretionary authority to abstain from exercising jurisdiction where another court has concurrent jurisdiction.” See Kish v. Wright, 562 P.2d 625, 628 (Utah 1977) (“[A]s part of the inherent power that our district courts have, as courts of general jurisdiction, they undoubtedly could refuse to exercise jurisdiction if convinced that it would place an unreasonable burden upon some or all of the parties, or upon the court, to try the case here.”); id. (“[T]he trial court does have concurrent jurisdiction and the power of discretion as to whether or not it will invoke that jurisdiction in a particular case.”). These are all considerations that we leave to the district court’s discretion on remand.[10]
CONCLUSION
¶21 The district court was not required to dismiss the divorce action for lack of jurisdiction following Thomas’s death. We therefore reverse and remand to the district court with instructions to reconsider Lidia’s Motion for Entry of Final Property Distribution and Rule 25 Motion to Substitute Party.
[1] Because the individuals share the same last name, we follow our usual practice of referring to them by their first names, with no disrespect intended by the apparent informality.
[2] Lidia sought a retroactive increase of alimony for 51 months, which represented the span between entry of a temporary order awarding her alimony and her remarriage.
[3] This included the determination of what portion of the large estate constituted marital property and what portion constituted Thomas’s separate property.
[4] Thomas’s counsel continued to represent Thomas’s interests immediately after his death pursuant to Stoddard v. Smith, 2001 UT 47, 27 P.3d 546. See id. ¶ 11 (“An attorney has an ethical obligation to take the necessary steps to protect a deceased client’s interests immediately following the client’s death[.]”).
[5] Thomas Jr. asserts that the district court did not actually rule that it lost jurisdiction over the divorce action. Instead, he suggests that the court simply exercised its “inherent equitable discretion in deciding to leave [Lidia] to pursue those claims in probate court.” But although the court’s initial ruling did not invoke the specific term “jurisdiction,” it nonetheless concluded, with our emphasis, that “Utah precedent requires a surviving party in a bifurcated divorce to pursue unresolved equitable claims to marital property before a probate court.” And in its Final Order, the court clarified, “Due to the untimely death of [Thomas], this court no longer has jurisdiction over this matter and this matter is closed.” Accordingly, the court did, in fact, conclude that it lacked jurisdiction and closed the divorce action on that ground.
Lidia also argues that the district court abused its discretion when it denied her motion to substitute Thomas’s personal representative in the divorce proceeding under rule 25 of the Utah Rules of Civil Procedure. But because the basis of the court’s denial of that motion was its lack of jurisdiction, which ruling we ultimately reverse, we remand to the district court with instructions to reconsider the rule 25 motion on the merits. See generally State v. De La Rosa, 2019 UT App 110, ¶ 4, 445 P.3d 955 (“Trial courts do not have discretion to misapply the law.”) (quotation simplified).
[6] Our Supreme Court also abandoned, as “clearly dictum,” a statement in one of its prior decisions that purported to overrule In re Harper’s Estate. See Porenta v. Porenta, 2017 UT 78, ¶ 22, 416 P.3d 487. Namely, the Court abandoned the statement that “the death of one or both parties to a divorce action during the pendency of the action causes the action itself to abate and the married couple’s status, including their property rights, reverts to what it had been before the action was filed.” Id. (quotation simplified). In other words, the Court rejected “the proposition that the parties’ property interests in the marital estate are frozen in time during the pendency of divorce litigation” and that “[i]f a party dies before the divorce becomes final, . . . property rights in the marital estate . . . are transported back in time to what they held before the divorce case was filed,” id. ¶ 23, which includes the reversal of any transfers of property that might have occurred during the pendency of the divorce action, id. ¶ 23 n.8.
[7] The court employed this presumption because the mother had not carried her burden of persuasion regarding whether property claims raised in a divorce proceeding survive the death of a spouse. See Porenta, 2017 UT 78, ¶¶ 32, 36; infra ¶ 15.
[8] The mootness doctrine “is a constitutional principle limiting our exercise of judicial power under article VIII of the Utah Constitution” and “not a simple matter of judicial convenience.” Transportation All. Bank v. International Confections Co., 2017 UT 55, ¶ 14, 423 P.3d 1171 (quotation simplified). “A case is deemed moot when the requested judicial relief cannot affect the rights of the litigants,” State v. Lane, 2009 UT 35, ¶ 18, 212 P.3d 529 (quotation simplified),thereby rendering a decision “purely advisory,” Transportation All. Bank, 2017 UT 55, ¶ 15 (quotation simplified). established as courts of equity that retain jurisdiction over the parties and subject matter for the purposes equity may demand.” Potts v. Potts, 2018 UT App 169, ¶ 13, 436 P.3d 263 (quotation simplified).
[9] Not all claims raised in the current divorce action concerned property rights. For example, it is undisputed that the claims related to custody, child support, and parent-time abated upon Thomas’s death. On remand, the district court should dismiss any remaining non-property claims that were rendered moot by Thomas’s death.
[10] We note that, sequentially, it may be more prudent for the district court to equitably distribute Lidia and Thomas’s marital estate—which potentially represents only a portion of Thomas’s vast estate that is the subject of the probate proceeding—rather than punting these issues to the probate court, especially where the district court had already prepared a ruling resolving all but one of the issues raised in the years-long divorce action that it superintended.
Julie J. Nelson and Alexandra Mareschal, Attorneys for Appellant and Cross-appellee
Thomas J. Burns and Aaron R. Harris, Attorneys for Appellee and Cross-appellant
JUDGE DAVID N. MORTENSEN authored this Opinion, in which JUDGE GREGORY K. ORME and JUSTICE DIANA HAGEN concurred.[1]
MORTENSEN, Judge:
¶1 After a lengthy marriage, Rayna and Glen Mintz[2] divorced and have since been involved in ongoing litigation regarding the distribution of marital property. Rayna and Glen now raise various issues for review, including questions about alimony, property distribution, and dissipation awards. In response to these appeals, we affirm in part, reverse in part, and remand to the district for further proceedings.
¶2 Through more than twenty years of marriage, Rayna and Glen enjoyed a relatively luxurious lifestyle. During the marriage, in addition to meeting their regular expenses, Rayna and Glen invested money essentially as savings. Before 2014, they made deposits into investment accounts “when money was left over after normal marital spending,” and after 2014, they made direct deposits into investment accounts as part of Glen’s employment. Historically, they spent money freely, traveled frequently, and treated themselves to a variety of entertainment—often with other people. For Rayna’s part, she often invited friends to join her on different jaunts across the globe or visits to the theater. For Glen’s part, as is relevant to this appeal, he invested both time and substantial money into an extramarital affair.
¶3 Rayna and Glen financed this lifestyle through substantial income generated by Glen’s employment as an investment advisor managing the assets and investments of various clients. As a salaried employee for his employer (Employer), Glen “did not sell . . . a client list to [Employer]”; instead, he expanded the clients he serviced by creating relationships with other employees and assisting other employees in managing their clients’ assets. As part of Glen’s compensation, Employer offered cash awards distributed as forgivable loans. For each loan, Employer provided the cash to Glen up front and then forgave Glen’s payback obligation each year, leaving Glen with a decreased payback obligation but an increased tax obligation. The cash awards were deposited directly into Glen and Rayna’s investment accounts.
¶4 When Rayna discovered Glen’s infidelity, the couple sought a divorce. Ultimately, the district court made several determinations relevant to this appeal. First, although Rayna would be awarded alimony, a monthly amount for investment would be excluded from the calculation because she presented insufficient evidence to show that the parties’ investments were “standard practice during the marriage” or that they “helped form the couple’s standard of living.”
¶5 Second, although an amount for entertainment was included as a historical expense in alimony calculations, the court “divided by four” the amount Rayna had proposed because the entertainment amount was calculated based on a time “when two minor children also lived in the home.”
¶6 Third, although the list of clients Glen serviced could be considered an asset, Glen did not own a “book of business,” and accordingly, whatever value his client list contained could not be divided between the parties.
¶7 Fourth, although Glen had admitted to dissipating $75,000 on his extramarital affair and although the court determined that Rayna should be entitled to “half” that amount, in an appendix to the district court’s findings of fact and conclusions of law, designating the specific property distributions, the court provided no amount in the space for money awarded to Rayna because of Glen’s dissipation.
¶8 And fifth, although Rayna would receive what Glen argued was an investable property distribution, the court declined to include investment income in its alimony calculation because (1) the likelihood of a specific return was uncertain, (2) Rayna’s investment income should be left unencumbered as was Glen’s, and (3) the parties had traditionally reinvested investment income instead of living off it.
¶9 Following entry of the divorce decree, Rayna filed a motion to enforce, asserting that various investment accounts at issue in the divorce “were not divided immediately after trial and that they subsequently appreciated in value.” Accordingly, Rayna sought an order requiring Glen to transfer holdings “equivalent to her proportionate share of appreciation since trial.” However, before the hearing on that motion, Rayna filed a notice of appeal. At the hearing, the court determined that the enforcement order Rayna requested would require the court to not just enforce the order but to “read language into [the decree] and interpret [the decree] in a way that modifie[d] or amend[ed]” it. Because a notice of appeal had been filed in the case, the court determined it had been “divested of jurisdiction” to amend the decree and therefore could not provide the relief Rayna requested.
¶10 On these issues, Rayna and Glen both appeal.
ISSUES AND STANDARDS OF REVIEW
¶11 First, Rayna contends that the court abused its discretion through its award of alimony. Specifically, Rayna contends that (1) the court “misapplied Utah law” when it declined to award alimony consistent with historical investment and (2) the court entered unsupported findings of fact in reducing her entertainment expenses. “We review a district court’s alimony determination for an abuse of discretion and will not disturb its ruling on alimony as long as the court exercises its discretion within the bounds and under the standards we have set and has supported its decision with adequate findings and conclusions.” Gardner v. Gardner, 2019 UT 61, ¶ 16, 452 P.3d 1134 (cleaned up). However, misapplication of the law is a de facto abuse of discretion, and an alimony award based on a misapprehension of the law will not be upheld. See Bjarnson v. Bjarnson, 2020 UT App 141, ¶ 5, 476 P.3d 145. Moreover, an alimony award based on clearly erroneous findings of fact will be overturned, see Leppert v. Leppert, 2009 UT App 10, ¶ 8, 200 P.3d 223, as will be an incorrect determination that evidence is insufficient to support an award, see Kimball v. Kimball, 2009 UT App 233, ¶ 14, 217 P.3d 733. “[U]nder our clearly erroneous standard, we will disturb a court’s factual findings only where the court’s conclusions do not logically follow from, or are not supported by, the evidence.” Gardner, 2019 UT 61, ¶ 32.
¶12 Second, Rayna contends that the district court erred when it determined that the list of clients Glen managed as an investment advisor (the book of business) was not a divisible marital asset. “Determining and assigning values to marital property is a matter for the trial court,” and an appellate court “will not disturb those determinations absent a showing of clear abuse of discretion.” Talley v. Talley, 739 P.2d 83, 84 (Utah Ct. App. 1987).
¶13 Third, Rayna contends that the district court failed to award or reimburse her half of the amount that Glen dissipated. “Where the trial court’s conclusions of law do not properly follow from the findings of fact, those conclusions can be overturned on appeal.” Cowley v. Porter, 2005 UT App 518, ¶ 46, 127 P.3d 1224.
¶14 Fourth, Rayna contends that the court erred in determining, based on the divorce decree’s language, that it lacked jurisdiction to grant Rayna appreciation on investment account awards. We review for correctness the district court’s interpretation of a divorce decree, Mitchell v. Mitchell, 2011 UT App 41, ¶ 5, 248 P.3d 65, and the district court’s “determination on jurisdictional issues,” National Advert. Co. v. Murray City Corp., 2006 UT App 75, ¶ 11, 131 P.3d 872 (cleaned up).
¶15 Fifth, on cross-appeal, Glen contends that the district court abused its discretion when it did not “determine an amount of income that Rayna [would] be able to earn from her awarded investment account assets and . . . apply that income to her ability to pay for her marital standard of living.” As indicated above, we review the district court’s alimony determination for abuse of discretion. See Gardner, 2019 UT 61, ¶ 16.
ANALYSIS
I. Alimony
A. Investment
¶16 Rayna contends that the district court erred in excluding from the alimony award an amount reflective of historical investment. Specifically, Rayna argues that the court misunderstood the phrases “standard practice” and “marital standard of living” as these phrases have been employed in Utah caselaw concerning the appropriateness of alimony awards that include amounts for investment or savings. Rayna argues that the parties made deposits into investment accounts as a standard practice that contributed to their marital standard of living, and she asserts that she should have received a higher alimony award to be able to continue this practice and maintain her standard of living. On appeal, we conclude that the district court erred in its application of the law on this point.
¶17 In Bakanowski v. Bakanowski, 2003 UT App 357, 80 P.3d 153, we indicated that “while the recipient spouse’s need to fund post-divorce savings, investment, or retirement accounts may not ordinarily be factored into an alimony determination, we cannot say that the ability to fund such post-divorce accounts may never be taken into account as part of” that analysis. Id. ¶ 16. Rather, “[t]he critical question is whether funds for post-divorce savings, investment, and retirement accounts are necessary because contributing to such accounts was standard practice during the marriage and helped to form the couple’s marital standard of living.” Id. (emphasis added); see also Knowles v. Knowles, 2022 UT App 47, ¶ 57 n.8, 509 P.3d 265; Miner v. Miner, 2021 UT App 77, ¶ 58 n.8, 496 P.3d 242. Thus, the court should, as a legal matter, ensure it employs the correct legal definitions of standard practice and marital standard of living, apply the facts of a given case to those definitions, and then determine whether the facts as found meet the criteria for a savings-based alimony award.
¶18 First, the district court erred in concluding that Rayna and Glen’s undisputed course of conduct did not demonstrate a standard practice. See Bakanowski, 2003 UT App 357, ¶ 16; Kemp v. Kemp, 2001 UT App 157U, paras. 3–4, 2001 WL 522413. When the Bakanowski court provided the test for appropriate consideration of savings, investment, and retirement accounts in alimony calculations, it cited Kemp v. Kemp, in which the court reasoned that because “the parties had made regular savings deposits,” including savings in the alimony award could help “maintain the recipient spouse’s marital standard of living.” See 2001 UT App 157U, paras. 3–4 (emphasis added).
¶19 An event must certainly be recurring but need not be uniformly systematic to be considered “regular.” See id. at para. 3. Indeed, “something can be done ‘regularly’ if done whenever the opportunity arises, though the actual time sequence may be sporadic.” Youth Tennis Found. v. Tax Comm’n, 554 P.2d 220, 223 (Utah 1976); see also Allen Distrib., Inc. v. Industrial Comm’n, 604 P.2d 938, 940 (Utah 1979) (reciting the then-enacted workers’ compensation laws that provided that “regularly” could include employment “continuous throughout the year or for only a portion of the year” (cleaned up)); Holt v. Industrial Comm’n, 87 P.2d 686, 689 (Utah 1939) (defining “regularly employed” to include “all employees who are employed and engaged in the usual or regular business of the employer, regardless of whether they were regularly or only casually or occasionally employed” (cleaned up)). Thus, even though an activity may “occur[] at intermittent times,” it can still be a regular activity. See Youth Tennis, 554 P.2d at 223 (cleaned up); see also B.L. Key, Inc. v. Utah State Tax Comm’n, 934 P.2d 1164, 1166 (Utah Ct. App. 1997). And although “regular” could also be understood to require methodic uniformity, see Valentine v. Farmers Ins. Exch., 2006 UT App 301, ¶ 11, 141 P.3d 618 (noting that “‘regular use’ connotes use that is consistent with a recurring pattern or uniform course of conduct or dealing” and that it “embodies use that is marked by a pattern of usage or some frequency of usage”); Youth Tennis, 554 P.2d at 223 (noting that “one of the meanings of the term ‘regular’ is: ‘Steady or uniform in course, practice or occurrence’” (quoting Black’s Law Dictionary 1450 (Rev. 4th Ed. 1968))), there exists no requirement that savings or investment deposits be made with uniform frequency.
¶20 Accordingly, even if savings deposits and investments do not occur on an exact timetable, such marital expenditures can be considered a standard practice, see Bakanowski, 2003 UT App 357, ¶ 16, in those infrequent and unusual circumstances where a party can produce sufficiently persuasive evidence that savings deposits and investments were a recurring marital action “whenever the opportunity ar[ose], though the actual time sequence may be sporadic.” See Youth Tennis, 554 P.2d at 223; see also Bakanowski, 2003 UT App 357, ¶ 16.
¶21 The district court found that Rayna did not present “sufficient evidence” to show that contributing to savings and investment accounts was the standard practice during the marriage. But on appeal, neither party appears to dispute that the district court was presented with evidence that before 2014 the parties invested substantial amounts of income at least yearly and that after 2014 a substantial portion of Glen’s income was deposited directly into investment accounts at least yearly. Accordingly, for nearly a decade immediately preceding the divorce, the parties set aside substantial money for investments at least annually. This undisputed evidence established that the parties followed a regular pattern, i.e., a “standard practice,” see Bakanowski, 2003 UT App 357, ¶ 16, of investing a portion of their annual income. In other words, given these undisputed facts, we conclude the district court applied too narrow a definition of standard practice in rejecting this evidence as insufficient.
¶22 Second, to justify an alimony award that includes an amount for investment, the parties’ acts of investing must also contribute to the “marital standard of living.” Id. “Standard of living is defined as a minimum of necessities, comforts, or luxuries that is essential to maintaining a person in customary or proper status or circumstances.” Howell v. Howell, 806 P.2d 1209, 1211 (Utah Ct. App. 1991) (cleaned up) (emphasis added). In other words, in the alimony context, the marital standard of living is all that the parties enjoyed during the marriage—including luxuries and customary allocations—by virtue of their financial position. See id.; see also Rule v. Rule, 2017 UT App 137, ¶ 15, 402 P.3d 153.
¶23 In Knowles v. Knowles, 2022 UT App 47, 509 P.3d 265, the trial court refused to include tithing expenditures as part of the alimony calculation because it was “not a necessary living expense.” Id. ¶ 57 (cleaned up). On appeal, we reversed that decision, explaining that it “ignored the requirement that [trial courts] assess the expense based on how the parties chose to spend and allocate their money while married.” Id. (emphasis added). “By failing to assess whether the parties’ expenditures were consistent with the marital standard of living, the court abused its discretion.” Id.
¶24 The marital standard of living analysis is not merely a question about what the parties spent their money on or whether they spent it at all. Rather, in terms of alimony, the marital standard of living analysis is about whether the parties’ proposed points of calculation are consistent with the parties’ manner of living and financial decisions (i.e., the historical allocation of their resources). Something may contribute to the marital standard of living even though it may not result in a direct benefit or detriment to the marital estate’s net worth.
¶25 Like the trial court in Knowles, the district court here did not fully consider how the parties chose to “allocate” their income. See id. The parties’ choice to devote a substantial portion of income to investment and savings—much like the parties in Knowles chose to devote a substantial portion of their income to tithing, see id.—contributed to the parties’ marital standard of living. The court should consider this evidence in determining the amount of investment and savings expenditures to include in its alimony calculations. See id.; see also, e.g., Lombardi v. Lombardi, 145 A.3d 709, 716 (N.J. Super. Ct. App. Div. 2016) (“An appropriate rate of savings can, and in the appropriate case should, be considered as a living expense when considering an award of maintenance.” (cleaned up)); Bryant v. Bryant, 534 S.E.2d 230, 232 (N.C. Ct. App. 2000) (“The trial court may also consider established patterns of contributing to savings as part of the parties’ standard of living.” (cleaned up)); In re Marriage of Stenzel, 908 N.W.2d 524, 536 (Iowa Ct. App. 2018) (“[R]etirement savings in a reasonable sum may be a part of the needs analysis in fixing spousal support.”).
¶26 Below, the district court declared that “Rayna ha[d] not convinced the court that [the couple’s] savings [practices] somehow helped form the couple’s standard of living.” The court continued, “There was no evidence that the deposits into the investment accounts were used to fund future purchases or otherwise contributed to the marital standard of living.” In making this ruling, the district court apparently relied on Kemp, where the court found that “during their marriage, the parties had made regular savings deposits to fund future major purchases, rather than making those purchases on credit.” 2001 UT App 157U, para. 3. Including saved money in the “marital standard of living,” however, does not require a party to spend it, as the parties did in Kemp. Our precedent does not exclude prudent saving from the definition of the marital standard of living. Indeed, it would be a perverse state of the law if we, as a rule, always included in an alimony calculation all sums parties spent, even imprudently, but excluded sums wisely saved.
¶27 The parties presented evidence (and on appeal the parties continue to agree) that the investments were meant to facilitate future financial growth; that during the economic recession in 2008, the parties dipped into their investments to maintain their standard of living; and that they later used investments to pay tax obligations incurred because of Glen’s compensation structure. The very fact that such a substantial amount of Glen’s income went straight to investment that then served to pay off a tax obligation represents the type of allocation that constituted part of the marital standard of living. An understanding of the marital standard of living that is restricted to direct and immediate expenses is simply too limited. Instead, the use of marital funds to cover the parties’ investments and savings—provided it was standard practice during the marriage—is a proper consideration in determining the marital standard of living. See Bakanowski, 2003 UT App 357, ¶ 16.
¶28 In sum, the district court erred in concluding that insufficient evidence supported Rayna’s request to include amounts for investment in alimony calculations. The undisputed evidence established that it was both a standard practice to invest marital assets annually and that this pattern of investment contributed to the marital standard of living. We remand the case to the district court to recalculate alimony based on the amount that the couple’s historical investment contributed to the marital standard of living. See Bjarnson v. Bjarnson, 2020 UT App 141, ¶ 5, 476 P.3d 145 (“We will reverse if the court has not exercised its discretion within the bounds and under the standards we have set.” (cleaned up)).
B. Entertainment
¶29 Rayna also contends that the district court “entered a factual finding that was unsupported by the evidence regarding [her] entertainment expenses.” This is so, she argues, because testimony at trial established that the amount she originally requested for entertainment as part of her living expenses was “carved out . . . for her alone” and because the evidence, including the exhibit used to calculate her living expenses, did not otherwise suggest that the amount should have been reduced as it was by the district court. We agree that the district court’s reduction of Rayna’s entertainment expenses was based on clearly erroneous findings of fact because “the court’s conclusions do not logically follow from” and are not supported by “the evidence.” See Gardner v. Gardner, 2019 UT 61, ¶ 32, 452 P.3d 1134.
¶30 In determining the amount for entertainment expenses to include in its alimony calculation, the district court stated that the amount “presents expenses calculated for . . . years . . . when two minor children also lived in the home. Therefore, this amount should have been divided by four.” The district court reduced the amount it considered in its alimony calculation related to entertainment accordingly. However, this does not follow from the evidence presented at trial.
¶31 As an initial matter, when asked about the entertainment line item, Rayna testified that she loved “to go to concerts,” that she went “to New York City to the ballet [and] to the theater,” and that she generally hosted a friend on those trips. And testimony from Rayna’s expert on the matter explained that the amount was for “entertainment that she would normally spend on a monthly basis” and, specifically, that the amount was “what she actually spent if . . . carved out [for] her alone.” (Emphasis added.)
¶32 Glen attempts to provide support for the district court’s apparently contrary finding by suggesting that several line items on Rayna’s living-expense exhibit included a note that the amount was for “Rayna Only,” and that based on this notation, the district court “acted within its appropriate discretion” when it determined the amount requested for entertainment should be reduced because that line item did not include that note. However, in our review of the exhibit referred to by Glen, of the thirty-nine line items listed, only three specify that the amount was for “Rayna Only.” Yet some of the unmarked items reflect amounts the parties agree were spent on Rayna alone. Therefore, the absence of the “Rayna Only” notation does not necessarily reflect that those items were not for “Rayna Only.” And further, a line item for “Money Spent on Kids” specifically notes that it includes “Entertainment” expenses for those children. If Rayna’s entertainment expenses included money spent on the children, there would be no need to include a separate line item for entertainment under “Money Spent on Kids.” Moreover, we note that the district court’s determination that the amount should be “divided by four” because “two minor children also lived in the home” does not quite add up. Rayna and two children add up to three, and whether the court also included Glen or the friends Rayna often hosted is unclear from the court’s findings of fact. Either way, the justification does not appear to support the reduction.
¶33 Accordingly, the district court’s reduction of the alimony amount requested for entertainment contradicts not only the direct testimony at trial but also the very exhibit on which the court expressly based its findings. Because the court’s conclusions do not logically follow from and are not supported by the evidence, we determine that this portion of the award is based on clearly erroneous findings of fact, and we therefore remand to the district court for clarification and correction of the matter. See Leppert v. Leppert, 2009 UT App 10, ¶ 8, 200 P.3d 223; Gardner, 2019 UT 61, ¶ 32.
II. Book of Business
¶34 Rayna next opposes the district court’s determination that the book of business “was not a divisible marital asset.” However, to prevail on such a contention, Rayna would need to show that the court clearly abused its discretion, see Talley v. Talley, 739 P.2d 83, 84 (Utah Ct. App. 1987), something she has not done here.
¶35 In dealing with Rayna’s argument that Glen owned a book of business that should be a divisible marital asset, the district court first explained that the alleged book of business, comprising “a client list and the assets under management from these clients,” constituted an “asset” as a legal matter —a determination neither party appears to challenge on appeal. But the court did not stop there, determining next that this “asset” was owned not by Glen but by Employer.
¶36 The court explained its reasoning in over five pages of detailed findings of fact and conclusions of law. Throughout those pages, the district court explained, among other things, that although Glen had extensive experience in his field and a portion of his compensation required him to meet lofty expectations concerning the funds he managed, “[w]hen Glen began work for [Employer], he did not sell a book of business or a client list to [Employer]”; “[n]owhere within [the relevant employment documents] did [Employer] indicate that it was purchasing any client list from Glen or that Glen was selling anything at all to [Employer]”; and “Rayna ha[d] not presented any evidence that Glen sold any client list, client information, or other asset to [Employer] as a condition of his hiring.” Further, Glen “worked as an employee of [Employer]”; “ha[d] been paid a salary . . . as a W-2 employee”; and “expand[ed] the client list” by, in part, “creat[ing] relationships with other . . . employees who advise individuals that they service to place assets under Glen’s management.” The court then noted that often “Glen manages assets owned by numerous individuals and entities with whom he has no personal relationship.”
¶37 The court then described various agreements concerning Glen’s compensation and employment and highlighted portions of those agreements. One read,
All information concerning [c]lients of [Employer], former clients of [Employer], and prospective clients of [Employer] must be treated as confidential and must not be disclosed to anyone outside of [Employer.] . . . [I]n the event Employee’s employment is terminated for any reason whatsoever[,] Employee may not take any records or information referring or relating to [c]lients of [Employer], former clients of [Employer] and prospective clients of [Employer], whether originals or copies, in hard copy or computerized form.
Another read,
Employee may not directly or indirectly use, maintain, take or disclose any Confidential Information, except . . . in the course of carrying out Employee’s duties for [Employer] during Employee’s employment[.] . . . “Confidential Information” . . . includes . . . client relationships and prospective client relationships, client lists and contact information, client information (including but not limited to clients’ past and present financial conditions, investment practices, preferences, activities, objectives, and plans and other client data Employee obtained while in [Employer’s] employ)[.] . . . Employee further expressly agrees that, in the event his or her employment terminates, Employee’s use of Confidential Information, including but not limited to any information referring or relating to clients of [Employer], former clients of [Employer] and prospective clients of [Employer], must immediately cease and that Employee must immediately return, destroy or delete, any Confidential Information whether in hard copy or computerized form, including in any electronic device owned by Employee.
The court then reasoned, “[i]f the clients were clients, relationships, or contracts that Glen owned, he would not be subject to any restrictions with respect to the manner in which he stored, maintained, or utilized any of the client information, either during or after his employment with [Employer]. Similarly, if the client information was owned by Glen, he would not be subject to any restrictions.” Significantly, the court noted that “individuals and entities that own the assets under management have no contractual obligation to continue to use Glen to manage their assets; they are free to select a different . . . adviser [of Employer] at any time.” These individuals had “not contracted with Glen” but instead had “contracted with” Employer. And finally, the court reasoned that “[t]he terms Glen was offered by [Employer] were not negotiated. He did not negotiate higher pay or different terms but simply accepted employment on the terms offered by [Employer]. If Glen owned the book of business[,] he would have been in a position of greater leverage and been able to negotiate with [Employer].” In short, the district court determined that because Glen’s interactions with the book of business did not demonstrate ownership, “Glen [did] not own the book of business.”
¶38 Rayna attacks this determination primarily based on the alleged existence of alternative evidence. First, she asserts that evidence that Glen had some control over the book of business and its fruits and that the book of business included the information of some clients he had obtained before joining Employer demonstrated that Glen owned the book of business. But regardless of whether such evidence was before the district court, it would not contradict the findings the court did make— findings on which it relied to determine that, on the whole, Glen did not own the book of business. And although Rayna contends that “the evidence showed that [Employer] hopes to buy Glen’s book of business when he retires or transitions out of the industry and would facilitate the transfer of all of his clients to another advisor within [Employer],” this argument fails to acknowledge that the district court specifically considered this evidence in its findings of fact and ultimately found that the evidence did not deserve “any weight” because of a “lack of any testimony or other evidence by anyone who actually knew anything about” such a buy-out program. Indeed, “if there is evidence supporting a finding, absent a legal problem—a fatal flaw—with that evidence, the finding will stand, even though there is ample record evidence that would have supported contrary findings.” See Hinds v. Hinds-Holm, 2022 UT App 13, ¶ 28 n.4, 505 P.3d 1136 (cleaned up). And here Rayna has not demonstrated that such a flaw exists.
¶39 Because none of Rayna’s arguments on appeal show that the court clearly abused its discretion in its thorough and record-supported explanation of why Glen did not own the book of business, her contention on appeal is unavailing and we affirm the district court’s determination.
III. Dissipation
¶40 Rayna also contends that the district court erred when it included in the final distribution only half of the amount it determined Glen dissipated and failed to award Rayna any of it. Indeed, the district court found that “the amount of dissipation attributable to [Glen’s affair] is $75,000” and that “[t]hese funds were marital funds, for which Glen was entitled to half and Rayna to half.” But in the next line, the court, in seeming contradiction, stated, “Through dissipation, Glen spent half of $37,500 which Rayna was entitled to and therefore should be added to Glen’s [distribution] column.”
¶41 On appeal, the parties agree that Rayna is owed $37,500 due to Glen’s dissipation of $75,000. But the parties do not agree about the meaning of the court’s order or its associated appendix distributing the marital property. Having viewed both the court’s order, as recited above, and the appendix that purports to effectuate that order, we remand this issue to the district court for clarification.
¶42 Because the parties agree that the full amount of dissipation is $75,000 and that Rayna is thus entitled to $37,500, the only matter for us on appeal is to ensure that the order of the district court reflects that agreement. And it does not appear to do so. The court’s appendix lists three columns: one for the value of a given property item, one for Rayna’s portion of the property, and one for Glen’s portion of the property. In Rayna’s and Glen’s respective columns, a number was entered without parentheses to indicate a positive sum owed to the party, and a number was entered inside parentheses to indicate a sum to be subtracted from the ultimate distribution. For the line-item entry for dissipation, instead of $75,000, the value was listed as only $37,500. More important for our present purposes, Rayna’s column for that line item is empty whereas Glen’s contains $37,500 without parentheses, indicating a positive sum. As we read this entry, it appears that the incorrect dissipation amount was entered into the value, and instead of Rayna being awarded half of that $75,000, the amount of $37,500 was given to Glen. This was error.
¶43 On remand, the district court should correct this error and the associated appendix to indicate without ambiguity that the full amount of dissipation is $75,000 and that Rayna will be awarded $37,500 as her share of that total.[4]
IV. Property Distribution Appreciation
¶44 Rayna lastly contends that the district court “abused its discretion when it refused to award [her] a proportional share of the appreciation that accrued on the marital investment accounts” as she requested in her motion to enforce. She asserts that the court mischaracterized her motion to enforce as a motion to amend and that it accordingly erred in determining that it lacked jurisdiction to provide the relief she requested. On appeal, Rayna appears to maintain that her motion below was nothing more than a motion to enforce the decree; that the court had jurisdiction to enforce its decree; and that in determining that the order she requested would require an amendment (as opposed to mere enforcement), the court inherently “determined the decree did not already offer Rayna a proportional amount of the appreciation.” We agree with the district court that the relief Rayna sought would have required an amendment to the decree and that the court did not have jurisdiction to amend that decree once the notice of appeal had been filed.
¶45 We note that a “trial court is [generally] divested of jurisdiction upon the filing of an appeal.” Ortiz v. Crowther, 2017 UT App 133, ¶ 2, 402 P.3d 34 (per curiam). But a court may still enforce its decree even if an appeal has already been sought.[5] See Cheves v. Williams, 1999 UT 86, ¶ 48, 993 P.2d 191. Accordingly, because “Rayna filed a motion to enforce the decree,” she asserts that the court should have reached the merits of the issue she presented to it. But “[t]he substance of a motion, not its caption, is controlling.” DeBry v. Fidelity Nat’l Title Ins. Co., 828 P.2d 520, 523 (Utah Ct. App. 1992). And here, although Rayna titled her motion as one “to enforce,” the requested relief does not match that title. Cf. CBS Enters. LLC v. Sorenson, 2018 UT App 2, ¶¶ 11–12, 414 P.3d 925.
¶46 The decree instructed Glen “to ‘transfer’ equities valued at the exact amounts set forth.” (Emphasis added.) But in her motion, Rayna requested not only those exact amounts but also “post-trial appreciation over and above the exact figures set forth.” On appeal, Rayna concedes that “the decree said nothing about who should receive the appreciation that accrued” post-trial. Accordingly, we agree with the district court that to award the relief that Rayna sought would require the district court to “read language into” the decree “in a way that modifie[d] or amend[ed]” it. See Mitchell v. Mitchell, 2011 UT App 41, ¶ 5, 248 P.3d 65 (“We interpret a divorce decree according to established rules of contract interpretation.” (cleaned up)); see also Brady v.Park, 2019 UT 16, ¶ 53, 445 P.3d 395 (“If the language within the four corners of the contract is unambiguous, the parties’ intentions are determined from the plain meaning of the contractual language . . . .” (cleaned up)).
¶47 Because Rayna filed her notice of appeal before the district court ruled on her request for post-trial appreciation of the investment distribution, the district court had been divested of jurisdiction to alter the divorce decree in the way Rayna requested. See Ortiz, 2017 UT App 133, ¶ 2. Accordingly, we affirm the district court’s determination.
V. Investment Income
¶48 On cross-appeal, Glen contends that the district court abused its discretion when it did not include in its alimony calculation an amount reflecting Rayna’s ability to earn income from awarded investment accounts and apply that amount toward Rayna’s unmet needs.[6] Initially, Glen asserts that the district court “fail[ed] to consider Rayna’s ability to earn” income from these sources, but in the remainder of his argument, he proceeds to explain why the court’s actual consideration of her ability to earn income from investment accounts is based on unsupported findings or is otherwise unjustified.
¶49 For its part, the district court acknowledged Glen’s argument that Rayna would receive an investable property distribution that could provide “at least” a six percent return. While Utah “caselaw directs district courts to consider all sources of income when determining alimony, it does not dictate that all sources of income be counted as income received”—instead district courts have “broad discretion to treat sources of income as the court sees fit under the circumstances.” Eberhard v. Eberhard, 2019 UT App 114, ¶ 21, 449 P.3d 202. The court then provided three justifications for its determination that “it would be inequitable to include interest, dividend or other unearned income potentially generated from investment assets received in the marital property award.”
¶50 First, the court explained that the “ability to obtain a 6% return is not sufficiently certain for the court to rely on.” It noted the inconsistency of historical returns, Rayna’s discretion to use her distribution for purposes other than investment, and the difficulty of projecting future investment income. Second, the court explained that “[i]t would be inequitable for Glen to be able to keep his share of the investments and retain their income stream to reinvest as he continues to generate professional income, while Rayna would retain only the investments after being compelled to expend her investment income to pay her living expenses.” The court felt that such an order would “wrongly deprive[] Rayna of the full benefit and value of” her distribution and that she should be able to “grow” any investments she would make without the obligation to use that money for providing for her own standard of living. Third, the district court explained that “[i]t was the parties’ regular practice not to spend or live off investment income, but rather to entirely reinvest that income.” Accordingly, the court refrained from applying any amount of potential investment income toward Rayna’s projected earning capacity.
¶51 In determining whether a spouse should receive alimony, the general rule is that a court should first take care of property distribution. See Batty v. Batty, 2006 UT App 506, ¶ 5, 153 P.3d 827 (“[An alimony] evaluation properly takes into account the result of the property division, particularly any income-generating property [the receiving spouse] is awarded, but alimony is not meant to offset an uneven property award. Rather, as a matter of routine, an equitable property division must be accomplished prior to undertaking the alimony determination.”). Then, depending on how the property distribution works out— especially considering income-generating property—the court considers whether alimony will be necessary for a spouse to meet demonstrated needs. See Burt v. Burt, 799 P.2d 1166, 1170 (Utah Ct. App. 1990) (“Alimony is appropriate to enable the receiving spouse to maintain as nearly as possible the standard of living enjoyed during the marriage and to prevent the spouse from becoming a public charge.” (cleaned up)); see also Batty, 2006 UT App 506, ¶ 4 (“In determining alimony, the trial court must consider three important factors: (1) the financial condition and needs of the spouse claiming support, (2) the ability of that spouse to provide sufficient income for him or herself, and (3) the ability of the responding spouse to provide the support. Although a trial court is given considerable discretion in determining an alimony award, failure to consider these factors constitutes an abuse of discretion.” (cleaned up)). And as we held in Eberhard v. Eberhard, 2019 UT App 114, 449 P.3d 202, while the district court must consider all potential sources of income, it is not required to count those sources of income. Id. ¶ 21. This is nothing more than an expression of the rule that a district court has “broad discretion to treat sources of income as the court sees fit under the circumstances.” Id.
¶52 Here, contrary to Glen’s assertion, the district court did, in fact, consider Rayna’s ability to earn income from her distributed investment assets in reaching its determination that she would still require additional alimony to support herself to the level of the marital standard of living. See Dobson v. Dobson, 2012 UT App 373, ¶ 21, 294 P.3d 591 (stating that for the purposes of determining alimony, “the needs of the spouses are assessed in light of the standard of living they had during marriage” (cleaned up)). Given that the district court considered Rayna’s ability to earn income in reaching its determination that she was entitled to alimony, the question before us is whether the circumstances allowed the district court to refrain from counting any future investment income Rayna may receive in its calculation. None of Glen’s arguments attacking the court’s determination persuade us that the court exceeded its discretion here.
¶53 First, Glen argues that the court’s determination that the “ability to obtain a 6% return is not sufficiently certain for the court to rely on” contradicts its other findings. Specifically, he cites a finding that states “Glen’s income has consistently increased” and “[o]ther than general economic uncertainty, there was no evidence at trial that this trend would not continue.” He then claims that this statement contradicts the court’s determination that Rayna would not obtain a return on her investments.
¶54 However, the two findings are not comparable at their roots. Regarding Rayna’s potential income, the court was specifically discussing income resulting from a return on investments; but regarding Glen’s income, the court was noting an increase in his income as a whole, including that income derived from gainful employment and not exclusively income derived from any returns on Glen’s ongoing investments. A projection that Glen’s income as a whole, salary and all, will continue to increase is not incompatible with a determination that a return on investment income is insufficiently certain to rely on.
¶55 As part of this argument, Glen also characterizes an unrelated finding from the court’s ruling as a determination that Rayna’s relevant accounts were “not easily liquidated” and asserts that the court’s statement that Rayna may choose to liquidate a portion of these investments contradicts that finding. But this description of the court’s finding is simply inaccurate— the court noted that the “accounts [were] not liquid,” and it made no statement about whether there would be difficulty in liquidating them. And even if the accounts were difficult to liquidate, it would, again, not be incongruous with the court’s other findings, specifically that Rayna could choose to liquidate, any difficulty notwithstanding.
¶56 Further, Glen asserts that the court unjustifiably determined that both parties should “grow” their investments but that growth on Rayna’s accounts was uncertain. Again, these findings are not incongruous—the district court could reasonably find that a return was uncertain, that requiring Rayna to use any return to provide for her needs would prevent her from increasing the amount invested, and that Rayna deserved the opportunity to have her investment returns be reinvested for potential future growth.
¶57 Second, Glen asserts that the court gave Rayna freedom to reinvest her investment returns while it restricted Glen to using his investment returns to pay for both the taxes owed on his forgiven loans and Rayna’s alimony award. As to the alimony award, we note that Glen has not directed us to anywhere in the record where the district court explained that he must pay for Rayna’s alimony using investment income, and as such, Glen is free to provide for Rayna’s alimony using whatever resources he desires, whether it be his salary, proceeds from a mortgage or other loan, or, indeed, his investment income.
¶58 Third, Glen asserts that the court’s finding that “Lilt was the parties’ regular practice not to spend or live off investment income, but rather to entirely reinvest that income” contradicts its acknowledgment that Glen incurred a tax obligation from the forgiven loans. However, we note that although Glen maintains on appeal that he used the forgivable-loan investment returns to pay tax obligations, Glen has not pointed to the court ever making a finding to that effect, and thus the findings are not inconsistent. Further, although such evidence was before the court, the court also stated that “Glen did not include his own investment income in his Financial Declaration as income available to pay alimony or to otherwise meet his own need.” That fact, the court stated, “demonstrate[d] that neither party considered investment income as income to be spent or expended, but rather as a vehicle to increase savings and net worth.” While a pattern of using investment returns to pay tax obligations may not be completely compatible with a pattern of using returns to “increase savings and net worth,” we do not view this apparent inconsistency as enough to persuade us that the court abused its discretion.
¶59 In sum, Glen has not demonstrated that the court abused its discretion in refusing to count Rayna’s potential investment returns as income toward her ability to meet her living expenses. Accordingly, we affirm the district court on this point.
CONCLUSION
¶60 First, we remand to the district court to apply the correct standard to the evidence regarding investments and savings and to adjust the alimony award based on calculations that account for Rayna’s historical spending on future investments; we also remand to the district court to adjust the alimony award based on calculations that account for Rayna’s historical spending on entertainment. Second, we affirm the district court’s determination that Glen did not own the book of business. Third, we remand to the district court to ensure that Rayna is awarded the $37,500 owed to her due to Glen’s dissipation. Fourth, we affirm the district court’s determination that the relief Rayna requested in her motion to enforce would have required it to amend the decree and that it lacked jurisdiction to do so. And fifth, we affirm the district court’s decision not to include potential investment income in calculating Rayna’s actual income. On remand, we instruct the district court to engage in further proceedings as necessary to effectuate the holdings provided in this opinion.
[1] Justice Diana Hagen began her work on this case as a judge of the Utah Court of Appeals. She became a member of the Utah Supreme Court thereafter and completed her work on the case sitting by special assignment as authorized by law. See generally Utah R. Jud. Admin. 3‑108(4).
[2] Due to the parties’ shared surname, we employ their given names.
[3] The parties are appealing an order from a bench trial. “We view the evidence in a light most favorable to the trial court’s findings, and therefore recite the facts consistent with that standard. However, we present conflicting evidence to the extent necessary to clarify the issues raised on appeal.” Kidd v. Kidd, 2014 UT App 26, n.1, 321 P.3d 200 (cleaned up).
[4] The district court’s view, which we endorse, is that Glen spent $75,000 in marital funds on his affair—not a proper marital purpose. Half of that amount was essentially his, but the half belonging to Rayna should properly be restored to her by Glen.
[5] Notwithstanding this general rule, the lower court may, in addition to dealing with motions to enforce the decree address clerical errors and other mistakes “arising from oversight or omission” that the appellate court asks it to address even after an appeal has been filed. See Utah R. Civ. P. 60(a); see also Cheves v. Williams, 1999 UT 86, ¶ 45, 993 P.2d 191 (“We have also recognized exceptions to [the general] rule, in the interest of preventing unnecessary delay, where any action by the trial court is not likely to modify a party’s rights with respect to the issues raised on appeal, or where the action by the trial court is authorized by rule or statute.” (cleaned up)).
[6] Although the district court did not impute income to Rayna based on investment earnings, it did impute to her some income based on an undisputed amount of earning capacity.
Brian E. Arnold and Lauren Schultz, Attorneys for Appellee
JUDGE MICHELE M. CHRISTIANSEN FORSTER authored this Opinion, in which JUDGES GREGORY K. ORME and DAVID N. MORTENSEN concurred.
CHRISTIANSEN FORSTER, Judge:
¶1 Prior to their marriage, Robben Ann Oldroyd (Ann) and Farrell Lynn Oldroyd (Farrell) built a home on property owned by Ann. Ann paid for the materials and contractors used in the construction of the home, and Farrell contributed his skills and labor to build the specialty log home. When the parties divorced many years later, a dispute arose regarding their relative interests in the home. This is the third time questions relating to their dispute have come before this court. In the current appeal, we are asked to consider whether the district court erred in awarding Farrell a share of Ann’s premarital equity in the home based on its application of the contribution and extraordinary situation exceptions to the separate-property presumption. We conclude that the contribution exception does not apply to premarital contributions and that the extraordinary situation exception does not apply because Farrell had other means of protecting his alleged interest in the home. Accordingly, we reverse the district court’s ruling and remand with instructions for the court to award the disputed equity to Ann.
BACKGROUND
¶2 This is the third time this matter has come before this court. See Oldroyd v. Oldroyd (Oldroyd I), 2017 UT App 45, 397 P.3d 645; Oldroyd v. Oldroyd (Oldroyd II), 2019 UT App 155, 474 P.3d 467. Each appeal has concerned the parties’ home. Ann purchased the land on which the home was built before the parties were married. Oldroyd I, 2017 UT App 45, ¶ 2. While Ann and Farrell were dating, Ann arranged to have the home built. Id. Ann paid for the costs of materials and construction, but Farrell contributed “supervision, labor, work, expertise, and conceptual direction” for the construction. Id. ¶¶ 2, 4 (quotation simplified). Subsequently, the parties married and lived together in the home, but the land and home remained in Ann’s name alone. Id. ¶ 2.
¶3 While both parties agree that Ann should receive a credit for what she spent on the land on which the home was built, the parties disagree about how the remaining equity in the home should be distributed. Farrell argues that all remaining equity should be shared equally between the parties. Ann, on the other hand, maintains that she should receive a credit for both the amount she spent on the land and the amount she spent on construction costs before the parties divide the remaining equity.[1]
¶4 In its original findings of fact and conclusions of law in the parties’ divorce, the district court found that Farrell’s nonmonetary contributions were “roughly equal” to Ann’s financial contributions and that he had therefore acquired “a separate premarital interest in the improvements on the property.” Id. ¶ 4
(quotation simplified). However, we overturned that determination on appeal because the court “did not explain what legal theory gave rise to that equitable interest.” Id. ¶ 8.
¶5 On remand, the district court again determined that Farrell had a premarital interest in the home but this time premised its ruling on a theory of unjust enrichment. Oldroyd II, 2019 UT App 155, ¶ 4. However, we once again reversed the court’s ruling, this time on the basis that Farrell had never asserted an unjust enrichment claim. Id. ¶¶ 7–9.
¶6 In Oldroyd II, we further explained that Farrell’s pleadings did not raise a claim that he had acquired a premarital interest in the home. Rather, Farrell asserted that because he had “exerted hours and money into the home, including trade work,” he “should be awarded a sum certain from [Ann’s] equity in the home for all the work he has completed on the home, and for value of his trade work that he has performed for investment on the marital home.” Id. ¶ 7 (quotation simplified). In other words, Farrell raised not an equitable claim “for a premarital interest in property,” but “a claim for an equitable award of a portion of [Ann’s] premarital asset.” Id. However, because the district court had not considered equitable bases on which Farrell might be entitled to a share of Ann’s premarital interest, we left open the possibility that the court might determine that such an award was appropriate. Id. ¶ 11 & n.3.
¶7 On remand, the district court, for the third time, awarded Farrell a share of equity in the home. This time, the court recognized that the property was Ann’s premarital asset but concluded that Farrell was entitled to a portion of Ann’s premarital equity based on the contribution exception and the extraordinary situation exception. Ann again appeals.
ISSUE AND STANDARD OF REVIEW
¶8 Ann asserts that the district court erred in awarding Farrell a share of her equity in the home because Farrell’s contributions occurred prior to the marriage and the extraordinary situation exception is not applicable. “We generally defer to a trial court’s categorization and equitable distribution of separate property,” Lindsey v. Lindsey, 2017 UT App 38, ¶ 26, 392 P.3d 968 (quotation simplified), so long as the court’s judgment “fall[s] within the spectrum of appropriate resolutions,” id. ¶ 29.
ANALYSIS
¶9 Historically, we have recognized three equitable exceptions that may justify an award of one spouse’s premarital property to the other spouse: (1) the commingling exception, (2) the contribution exception, and (3) the extraordinary situation exception. See Lindsey v. Lindsey, 2017 UT App 38, ¶ 33, 392 P.3d 968. Only the contribution exception and the extraordinary situation exception are at issue in this case.
¶10 As a threshold matter, we note that it is somewhat unclear from the district court’s discussion whether it was relying on the contribution exception, the extraordinary situation exception, or both exceptions in awarding the disputed funds. The parties’ arguments on appeal primarily concern the applicability of the extraordinary situation exception, and they appear to be operating under the assumption that the court’s decision rested on that exception. However, given that the court’s application of the extraordinary situation exception was based on its determination that Farrell’s premarital contributions made it equitable to award him a share of Ann’s premarital property, we think it appropriate to address both exceptions in our analysis.
I. Contribution Exception
¶11 “Under the contribution exception, a spouse’s separate property may be subject to equitable distribution [upon divorce] when the other spouse has by his or her efforts or expense contributed to the enhancement, maintenance, or protection of that property, thereby acquiring an equitable interest in it.” Lindsey v. Lindsey, 2017 UT App 38, ¶ 35, 392 P.3d 968 (quotation simplified). Common examples include a spouse working for the other spouse’s premarital business without taking a salary, see, e.g., Rappleye v. Rappleye, 855 P.2d 260, 263 (Utah Ct. App. 1993), or a couple using marital funds to make improvements to or pay a mortgage on a premarital property, see, e.g., Schaumberg v. Schaumberg, 875 P.2d 598, 601 (Utah Ct. App. 1994). However, as we noted in Oldroyd II, “[p]revious cases addressing equitable division of premarital assets have involved contributions made to those assets during the course of the marriage,” and “Utah courts have not had the opportunity to assess the extent to which one spouse’s premarital contributions to another spouse’s premarital assets may be considered in the context of a divorce court’s equitable division of property.”[2] 2019 UT App 155, ¶ 11 n.3, 474 P.3d 467.
¶12 Having now been presented with the opportunity to consider the applicability of the contribution exception to premarital contributions, we are convinced that it does not apply in this context. Unlike a married person, an unmarried person has no reasonable expectation of any benefit from or entitlement to separate property owned or acquired by their significant other. Here, Farrell chose to assist Ann in building her home without seeking compensation.[3] At that time, even though he may have expected to eventually marry Ann and live in the home with her, he had no guarantee that would happen. “As a general rule, . . . premarital property is viewed as separate property, and equity usually requires that each party retain the separate property he or she brought into the marriage.” Walters v. Walters, 812 P.2d 64, 67 (Utah Ct. App. 1991) (quotation simplified), superseded by statute on other grounds as stated in Whyte v. Blair, 885 P.2d 791 (Utah 1994). Only “where unique circumstances exist” may a trial court “reallocate premarital property as part of a property division incident to divorce.” Id. “Generally, trial courts are . . . required to award premarital property, and appreciation on that property, to the spouse who brought the property into the marriage.” Elman v. Elman, 2002 UT App 83, ¶ 18, 45 P.3d 176.
¶13 Farrell had several options for protecting his interests, which he chose not to take advantage of. First, he could have entered into a contract with Ann requiring her to pay him for his services. Second, he could have negotiated a prenuptial agreement acknowledging his premarital contributions and granting him an interest in the home in case of divorce. Third— though likely an undesirable option given his relationship to Ann—Farrell could have filed a lawsuit bringing a quasi-contract claim, such as unjust enrichment, to obtain compensation for his services. However, the contribution exception is simply not one of the options available where the contributions occurred prior to the parties’ marriage.
II. Extraordinary Situation Exception
¶14 Just as Farrell’s premarital contributions to Ann’s premarital asset cannot support an award to him of Ann’s separate property under the contribution exception, they also cannot support an award under the extraordinary situation exception.
¶15 “The bar for establishing an extraordinary situation is high, traditionally requiring that invasion of a spouse’s separate property is the only way to achieve equity.” Lindsey v. Lindsey, 2017 UT App 38, ¶ 46, 392 P.3d 968 (quotation simplified). “A quintessential extraordinary situation arises when a spouse owns separate property but lacks income to provide alimony.” Id. In that circumstance, “an equitable distribution of the [separate property] would be well within the trial court’s discretion.” Kunzler v. Kunzler, 2008 UT App 263, ¶ 37, 190 P.3d 497 (Billings, J., concurring in part and dissenting in part); see also Burt v. Burt, 799 P.2d 1166, 1169 (Utah Ct. App. 1990) (“The court may award an interest in the inherited property to the non-heir spouse in lieu of alimony.”). The doctrine has also been applied in situations where a person did not contribute directly to their spouse’s premarital asset but their contributions to the marital estate allowed their spouse to enhance their own separate assets rather than the marital estate. SeeHenshaw v. Henshaw, 2012 UT App 56, ¶ 20 & n.7, 271 P.3d 837 (affirming an award of premarital ranch property to a wife, despite the fact that the value of the ranch had depreciated during the marriage, because the wife had borne “the financial burdens of the family in order to allow [the husband] to work almost exclusively on the ranch”); Elman v. Elman, 2002 UT App 83, ¶ 24, 45 P.3d 176 (affirming an award of stock in a premarital business to a wife whose income-earning activities allowed her husband to quit his job and devote time to managing and growing his premarital assets rather than contributing to marital assets). Taking on “domestic burdens” to make possible a spouse’s full-time participation in a premarital business may also be an extraordinary situation where the bulk of the business’s value is developed during the marriage. Savage v. Savage, 658 P.2d 1201, 1204 (Utah 1983).
¶16 But none of those examples reflect the situation we have here. Farrell seeks a portion of Ann’s premarital asset as payment for the work he did on the home prior to the couple’s marriage, not because Ann lacks the resources to pay alimony or enhanced her own separate asset during the marriage in lieu of contributing to the marital estate. And as we discussed above, Farrell had several options to protect his financial interests and to be compensated for his contributions to the home before marrying Ann. The fact that he chose not to employ any of these options does not give rise to the type of inequity that can be addressed only through the extraordinary situation exception. As a general matter, “equitable relief should not be used to assist one in extricating himself from circumstances which he has created.” Utah Coal & Lumber Rest., Inc. v. Outdoor Endeavors Unlimited, 2001 UT 100, ¶ 12, 40 P.3d 581 (quotation simplified). Thus, the district court exceeded its discretion in awarding Farrell a portion of Ann’s premarital asset based on the extraordinary situation exception.
CONCLUSION
¶17 Because we conclude that the contribution exception does not apply to premarital contributions to premarital property, that exception cannot be used to award Farrell a portion of Ann’s premarital interest in the home. Moreover, because Farrell had several options for seeking reimbursement for his premarital efforts, which he declined to exercise, awarding him an interest in the home at this stage of the proceedings is not justified under the extraordinary situation exception. Accordingly, we reverse the court’s award of the disputed portion of the home’s equity and remand with instructions to award the disputed equity to Ann.
I was awarded the house in the divorce. My ex’s things are still here and he/she won’t pick them up. When are they deemed abandoned?
Utah Code § 67-4a-201 provides, in pertinent part that property is presumed abandoned if the property is unclaimed by the apparent owner “the earlier of three years after the owner first has a right to demand the property or the obligation to pay or distribute the property arises.”
Utah Code § 67-4a-208 (Indication of apparent owner interest in property) provides, in pertinent part:
(1) The period after which property is presumed abandoned is measured from the later of:
(a) the date the property is presumed abandoned under this part; or
(b) the latest indication of interest by the apparent owner in the property.
(2) Under this chapter, an indication of an apparent owner’s interest in property includes:
(a) a record communicated by the apparent owner to the holder or agent of the holder concerning the property or the account in which the property is held;
(b) an oral communication by the apparent owner to the holder or agent of the holder concerning the property or the account in which the property is held, if the holder or the holder’s agent contemporaneously makes and preserves a record of the fact of the apparent owner’s communication;
(c) presentment of a check or other instrument of payment of a dividend, interest payment, or other distribution, or evidence of receipt of a distribution made by electronic or similar means, with respect to an account, underlying security, or interest in a business association;
(d) activity directed by an apparent owner in the account in which the property is held, including accessing the account or information concerning the account, or a direction by the apparent owner to increase, decrease, or otherwise change the amount or type of property held in the account;
(e) a deposit into or withdrawal from an account at a banking organization or financial organization, including an automatic deposit or withdrawal previously authorized by the apparent owner other than an automatic reinvestment of dividends or interest;
(f) any other action by the apparent owner which reasonably demonstrates to the holder that the apparent owner knows that the account exists; and
(g) subject to Subsection (5), payment of a premium on an insurance policy.
(3) An action by an agent or other representative of an apparent owner, other than the holder acting as the apparent owner’s agent, is presumed to be an action on behalf of the apparent owner.
(4) A communication with an apparent owner by a person other than the holder or the holder’s representative is not an indication of interest in the property by the apparent owner unless a record of the communication evidences the apparent owner’s knowledge of a right to the property.
(5) If the insured dies or the insured or beneficiary of an insurance policy otherwise becomes entitled to the proceeds before depletion of the cash surrender value of the policy by operation of an automatic premium loan provision or other nonforfeiture provision contained in the policy, the operation does not prevent the policy from maturing or terminating.
Utah Family Law, LC | divorceutah.com | 801-466-9277
Why is it so easy to get married, and so hard to get divorced? Shouldn’t it be the other way around?
This is a perceptive question.
It would not not be that hard to get divorced if you were to give up everything in the divorce. If you told your spouse, “I want a divorce so bad I’ll make this as easy for, and as advantageous to, you as possible by waiving any and all rights to the marital assets, spousal support, the kids, everything,” you could get divorced relatively quickly and without having to incur any attorney’s fees. Heck, your spouse might gleefully pay an attorney to draw the “my spouse is giving away the farm” divorce action and settlement agreement. Of course, while getting the divorce that way would be fast, easy, and cheap, you’d pay a dear personal price—in both the short and the long run—in almost every other aspect.
When you think about it, there are many endeavors that are easy to enter but prove to be very difficult to finish or exit (or at least to finish or exit comfortably):
college (easy to enroll, get loans), hard to finish, hard to pay off student loans, especially if you drop out and still have to pay the loans off
business (easier to get into than to stay in, and brutal to experience a business failure)
And marriage is another. The longer one is married, the harder a divorce usually is due to so much having been invested in a marriage of long duration. It’s easier for two single, childless people to marry than for two married people to divorce who acquired property/assets and incurred debt and who may have begotten minor children (to say nothing of the disruption divorce inflicts on the physical and emotional reliance upon each other that spouses develop over time). With this in mind, it’s hard to conceive a way by which we could reasonably and responsibly make easier than marrying the dividing the property/assets, apportioning responsibility for marital debts and obligations, and determining the custody of minor children in divorce.
Utah Family Law, LC | divorceutah.com | 801-466-9277
When do courts value the marital estate? At time of separation, or at the time the court enters the Decree of Divorce?
This is a question that often causes divorcing people’s heart to sink. I’ll tell you why, but first, let’s answer the question of whether courts value the marital estate in a divorce action: at time of separation, or at the time the court enters the Decree of Divorce?
The first answer to this question is: the court can value the marital estate at any time, if it can articulate a good reason for doing so.
“Generally, the marital estate is valued at the time of the divorce decree or trial.” Jacobsen v. Jacobsen, ¶ 39, 257 Pacific.3d 478 (cleaned up). However, as with alimony, the court has broad discretion to use a different date so long as its decision it supported by “sufficiently detailed findings of fact explaining its deviation from the general rule.” Id.; see also Rayner, 2013 UT App 269, ¶ 19, 316 P.3d 455 (“A trial court has broad discretion to deviate from [the] general rule when circumstances warrant.” (cleaned up)). “As a general rule, the marital estate is valued at the time of the divorce decree,” Rappleye v. Rappleye, 855 P.2d 260, 262 (Utah Ct.App.1993); see also Berger v. Berger, 713 P.2d 695, 697 (Utah 1985), and that “any deviation from the general rule must be supported by sufficiently detailed findings of fact that explain the trial court’s basis for such deviation,” Rappleye, 855 P.2d at 262.
How do you protect your assets from divorce, government confiscation, lawsuits, garnishments, or seizure?
Best way: own nothing. The government (in all its forms) cannot seize from you that which you do not own.
Downside: when you own nothing, you control nothing. If your wife, for example, owns the car you drive and the house in which you live, there’s no guarantee she and the car and the house will always be around for you.
You may have heard about creating an irrevocable trust or family partnership as a means of protecting your assets from creditors, and depending upon your situation and the laws of the jurisdiction that governs you and your assets, that may be a viable option. To know that, however, you would need to inquire with an attorney who knows and understands the laws of your jurisdiction.
Utah Family Law, LC | divorceutah.com | 801-466-9277
If you get a divorce but everything is in your name, do you get to keep everything or do you have to split it?
I will answer your question in the context of the law of the jurisdiction where I practice divorce law (Utah):
First, a short answer to your question: whether property acquired in the individual name of a spouse during a marriage (other than by gift or inheritance) does not somehow shield that property from being awarded in whole or in part to the other spouse in divorce.
Second, it will be helpful to understand a few terms that are key to understanding property in divorce (See Black’s Law Dictionary (11th ed. 2019)):
– marital property. Property that is acquired during marriage and that is subject to distribution or division at the time of marital dissolution. • Generally, it is property acquired after the date of the marriage and before a spouse files for separation or divorce. The phrase marital property is used in equitable-distribution states and is roughly equivalent to community property. — Also termed marital estate; matrimonial property.
– separate property. 1. Property that a spouse owned before marriage or acquired during marriage by inheritance or by gift from a third party, and in some states property acquired during marriage but after the spouses have entered into a separation agreement and have begun living apart or after one spouse has commenced a divorce action. — Also termed individual property.
– community property. Assets owned in common by husband and wife as a result of their having been acquired during the marriage by means other than an inheritance by, or a gift or devise to, one spouse, each spouse generally holding a one-half interest in the property. • Only nine states have community-property systems: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. A community-property regime is elective in Alaska.
– quasi-community property. Personal property that, having been acquired in a non-community-property state, would have been community property if acquired in a community-property state. • If a community-property state is the forum for a divorce or administration of a decedent’s estate, state law may allow the court to treat quasi-community property as if it were community property when it determines the spouses’ interests.
– equitable distribution (1893) Family law. The division of marital property by a court in a divorce proceeding, under statutory guidelines that provide for a fair, but not necessarily equal, allocation of the property between the spouses. • With equitable distribution, when a marriage ends in divorce, property acquired during the marriage is divided equitably between the spouses regardless of who holds title to the property. The courts consider many factors in awarding property, including a spouse’s monetary contributions, nonmonetary assistance to a spouse’s career or earning potential, the efforts of each spouse during the marriage, and the length of the marriage. The court may take into account the relative earning capacity of the spouses and the fault of either spouse. Equitable distribution is applied in 47 states (i.e., all the states except California, Louisiana, and New Mexico, which are “equal division” community-property states). — Also termed equitable division; assignment of property.
Utah is an equitable distribution state in the context of divorce. Here is how Utah defines the difference between separate and marital property, and what a divorce court is empowered to do with separate and marital property. See Lindsey v. Lindsey, 392 P.3d 968 (Utah Ct.App. 2017), 2017 UT App 38:
When distributing “marital property in a divorce proceeding, the overriding consideration is that the ultimate division be equitable—that property be fairly divided between the parties.” Granger v. Granger, 2016 UT App 117, ¶ 15, 374 P.3d 1043 (brackets, citation, and internal quotation marks omitted). To that end, a trial court must first “identify the property in dispute and determine whether it is marital or separate.” Dahl v. Dahl, 2015 UT 79, ¶ 121, ––– P.3d –––– (brackets, citation, and internal quotation marks omitted). Marital property ordinarily includes “all property acquired during marriage,” “whenever obtained and from whatever source derived.” Dunn v. Dunn, 802 P.2d 1314, 1317–18 (Utah Ct. App. 1990) (citation and internal quotation marks omitted). Separate property ordinarily includes premarital property, gifts, and inheritances, including any appreciation that may accrue during the marriage. SeeDahl, 2015 UT 79, ¶ 143, ––– P.3d ––––; Mortensen v. Mortensen, 760 P.2d 304, 308 (Utah 1988).
¶ 32 The presumption is that marital property will be divided equally while separate property will not be divided at all. See Dahl, 2015 UT 79, ¶ 121, ––– P.3d ––––; Dunn v. Dunn, 802 P.2d at 1323. Married persons have a right to separately own and enjoy property, and that right does not dissipate upon divorce. SeeMortensen, 760 P.2d at 308. Thus, equity generally requires that “each party retain the separate property he or she brought into the marriage, including any appreciation” thereof. Dunn, 802 P.2d at 1320, 1323; accordDahl, 2015 UT 79, ¶ 143, ––– P.3d ––––; Mortensen, 760 P.2d at 308.
¶ 33 But separate property “is not totally beyond a court’s reach.” Elman v. Elman, 2002 UT App 83, ¶ 19, 45 P.3d 176 (brackets, citation, and internal quotation marks omitted). Before carving property out of the marital estate, a trial court must consider whether circumstances warrant an equitable override of the separate-property retention rule. See Henshaw v. Henshaw, 2012 UT App 56, ¶ 15, 271 P.3d 837. Three circumstances have been identified under Utah law as supporting an award of separate property at the time of divorce. These exceptions are when separate property has been commingled; when the other spouse has augmented, maintained, or protected the separate property; and in extraordinary situations when equity so demands. SeeMortensen, 760 P.2d at 308; Dunn, 802 P.2d at 1320.
Utah Family Law, LC | divorceutah.com | 801-466-9277
JUDGE RYAN M. HARRIS authored this Opinion, in which JUDGE
GREGORY K. ORME and JUSTICE DIANA HAGEN concurred.[1]
HARRIS, Judge:
¶1 DiAnn Sheri Fox appeals several aspects of a comprehensive set of rulings issued by the trial court following a two-day divorce trial, including various findings relating to the court’s alimony award, its division of marital debts, and its determination that her ex-husband, Benjamin Davis Fox, was not voluntarily underemployed. For the reasons discussed below, we affirm the court’s orders.
BACKGROUND
¶2 DiAnn and Ben[2] were married in 1997, while Ben was in college and about to start medical school. After completing his training, Ben became a successful neurosurgeon with his practice centered in St. George, Utah. In the marriage’s final years, Ben was making more than $1 million per year, with his monthly pay sometimes as high as $110,000. Ben and DiAnn have six children together, four of whom were minors at the time of trial.
¶3 In keeping with Ben’s impressive income, the parties lived a lavish lifestyle during the marriage. To support that lifestyle, Ben spent a significant amount of time at work—as much as 80 to 100 hours per week. And even when he was not working, Ben was often “on call,” meaning that he had to stay within fifteen minutes of the hospital in case of a medical emergency. Ben took more “on call” shifts than any other physician in his practice. Part of the reason Ben worked such a taxing schedule—even for a neurosurgeon—was because he was qualified as both a neurosurgeon and as a neurointerventionalist, and his services were often in demand. Ben testified that, as a result, he was becoming burnt out and “physically and emotionally exhausted,” and that his work schedule was not sustainable. Due to his schedule, Ben spent comparatively little time with the children, leaving DiAnn largely responsible for their day-to-day care.
¶4 DiAnn has a bachelor’s degree in elementary education and worked full-time as a teacher before the couple’s children were born. While Ben was still in medical school, however, Ben and DiAnn decided that DiAnn would not generally work outside the home but instead would care for their children full-time. At the time of trial, DiAnn was working part-time for the local school district, earning ten dollars per hour.
¶5 In 2018, DiAnn filed for divorce. As part of her petition, DiAnn sought primary physical custody of the children, child support, alimony, equitable division of the marital debts, and equitable division of the marital property. A few months later, the trial court entered a temporary order awarding DiAnn primary physical custody of the children, with Ben allowed parent-time pursuant to Utah Code section 30-3-35.1. The court ordered Ben to pay $12,313 per month in child support, and $21,030 per month in alimony. The parties were also ordered to continue paying $2,500 ($1,250 each) per month to DiAnn’s father, to whom they owed a significant amount of debt.
¶6 After DiAnn filed for divorce, but prior to trial, Ben relocated to Florida and accepted employment there as a neurosurgeon. In his new position, Ben was paid less than he had been paid in St. George: instead of earning as much as $110,000 per month, Ben was now earning some $80,000 per month (nearly $1 million annually) in gross income. But in Florida, Ben had a less hectic work schedule, typically working 50 to 60 hours per week as opposed to the 80 to 100 hours per week he had often been working in St. George.
¶7 Also prior to trial, DiAnn filed a financial declaration with the trial court. In that declaration, she claimed $32,577.24 in monthly expenses, including—among other things—$16,132.24 for the mortgage payments on the parties’ large house; $1,880 for maintenance on the house; $2,000 for food and household supplies; $2,400 for utilities; $1,250 for half of the loan payments to her father; $855 for the children’s extracurricular activities; and $577.24 for travel, which included the costs associated with a timeshare condominium the couple owned in Hawaii.
¶8 Soon thereafter, the case proceeded to a bench trial, which was held over two days in September 2020. During the trial, the court heard testimony from DiAnn and Ben, as well as several other witnesses. DiAnn asked the court to find that Ben was voluntarily underemployed—because he was earning less in Florida than he had in St. George—and additionally asked that Ben’s higher St. George salary be imputed to him for the purposes of child support and alimony. In light of this request, and based on her expert’s testimony that the parties had established a standard of spending some $70,000 per month during the marriage, DiAnn asked the court to award her $11,050 per month in child support and some $35,000 per month in alimony.
¶9 In response to DiAnn’s argument that he was voluntarily underemployed, Ben called an expert to testify that, even with his reduced income, Ben’s earnings were above the 90th percentile of income for neurosurgeons in the United States. Ben thus requested that alimony and child support be calculated based on his Florida income and that the court reject DiAnn’s assertion that he was voluntarily underemployed.
¶10 We will discuss some of the particulars of the court’s ruling in more detail below, on an issue-by-issue basis. But in broad strokes, the court ruled in relevant part as follows: (a) the parties were awarded joint legal custody of the children; (b) DiAnn was awarded primary physical custody; (c) Ben was allowed parent-time pursuant to Utah Code section 30-3-37; (d) Ben’s monthly income would be calculated based on his Florida income, not his St. George income; (e) DiAnn’s net income was initially set at $699 per month, but would increase to $2,915 per month after two years; (f) Ben was not voluntarily underemployed; (g) Ben was ordered to pay DiAnn $9,760 per month in child support, which would decrease as the children transitioned into adulthood; (h) Ben was ordered to pay DiAnn $15,039 per month in alimony for a period of two years, and then $12,995 per month for another 22 years, unless terminated earlier “upon the death of either party, the remarriage or cohabitation of [DiAnn], or for any other reason under Utah law”; and (i) DiAnn was assigned sole responsibility for the marital debt owed to her father.
ISSUES AND STANDARDS OF REVIEW
¶11 DiAnn now appeals various aspects of the trial court’s rulings, and presents three principal issues for our review.[3] First, she challenges various aspects of the court’s alimony award. We review a court’s “alimony determination for an abuse of discretion and will not disturb its ruling on alimony as long as the court exercises its discretion within the bounds and under the standards our supreme court has set and so long as the trial court has supported its decision with adequate findings and conclusions.” Miner v. Miner, 2021 UT App 77, ¶ 11, 496 P.3d 242 (quotation simplified).
¶12 Second, DiAnn argues that the court abused its discretion when it assigned her the sole responsibility for the parties’ debt owed to her father and included the full payment for that debt in its alimony calculation. “The trial court’s division of debts is reviewed for abuse of discretion.” Boggess v. Boggess, 2011 UT App 84, ¶ 2, 250 P.3d 86 (per curiam). And because trial courts are in the “best position to weigh the evidence, determine credibility and arrive at factual conclusions, they have considerable latitude” to equitably divide marital debt “and their actions are entitled to a presumption of validity.” Mullins v. Mullins, 2016 UT App 77, ¶ 20, 370 P.3d 1283 (quotation simplified). “Accordingly, it would be inappropriate for an appellate court to reverse on an isolated item of property or debt distribution.” Id. (quotation simplified). “Rather, we must examine the entire distribution to determine if the trial court abused its discretion.” Id. (quotation simplified).
¶13 And finally, DiAnn asserts that the court erred when it found that Ben was not voluntarily underemployed. We “review the trial court’s finding of voluntary unemployment or underemployment and its calculation of imputed income for an abuse of discretion.” Christensen v. Christensen, 2017 UT App 120, ¶ 10, 400 P.3d 1219. “We will not disturb a trial court’s findings of fact unless they are clearly erroneous, that is, unless they are in conflict with the clear weight of the evidence, or this court has a definite and firm conviction that a mistake has been made.” Pope v. Pope, 2017 UT App 24, ¶ 4, 392 P.3d 886 (quotation simplified).
ANALYSIS
¶14 We begin with DiAnn’s challenge to the trial court’s alimony award, analyzing each aspect of that challenge in turn.
We then turn to DiAnn’s assertion that the court abused its discretion in assigning her the marital debt owed to her father. We conclude by examining DiAnn’s challenge to the court’s finding that Ben was not voluntarily underemployed.
I. Alimony
¶15 “Under Utah law, the primary purposes of alimony are: (1) to get the parties as close as possible to the same standard of living that existed during the marriage; (2) to equalize the standards of living of each party; and (3) to prevent the recipient spouse from becoming a public charge.” Miner v. Miner, 2021 UT App 77, ¶ 14, 496 P.3d 242 (quotation simplified). “Alimony is not limited to providing for only basic needs but should be fashioned in consideration of the recipient spouse’s station in life in light of the parties’ customary or proper status or circumstances, with the goal being an alimony award calculated to approximate the parties’ standard of living during the marriage as closely as possible.” Id. (quotation simplified).
¶16 During their marriage, DiAnn and Ben enjoyed a high standard of living, and in an attempt to approximate that standard of living, the trial court ordered Ben to pay DiAnn more than $15,000 per month in alimony for two years, and nearly $13,000 per month for 22 years thereafter. DiAnn takes issue with this alimony award.
¶17 But in so doing, DiAnn does not challenge the court’s decision about the duration or future reduction of the award, nor does she take issue with any of the specific line-item calculations the court made in arriving at the total alimony amount. Instead, DiAnn advances two other arguments. First, she asserts that the court erred by not starting its analysis by making a separate finding regarding the parties’ “marital standard of living,” and by not taking that standard of living sufficiently into account. Second, DiAnn argues that the court abused its discretion when it included the children’s extracurricular activity expenses in its alimony calculation, and then ordered that DiAnn be responsible for those expenses. We address each of these arguments, in turn.
A. Marital Standard of Living
¶18 DiAnn’s first challenge is an assertion that the trial court failed to properly take into account the parties’ marital standard of living. Specifically, relying on Rule v. Rule, 2017 UT App 137, 402 P.3d 153, DiAnn argues that the court failed to start its alimony analysis by making a separate finding specifically calculating the overall marital standard of living, and asserts that the court erroneously “moved straight to an arbitrary needs-based alimony analysis.” This, DiAnn asserts, contradicts the “roadmap” set out in Rule. In particular, DiAnn points to her own expert’s analysis—that the parties were spending, on average, more than $70,000 per month during the marriage—and asserts that the court should have concluded that she is entitled to half that amount in alimony, at least as long as Ben is able to pay it.
¶19 DiAnn misreads Rule. To be sure, in that case we noted that one of the purposes of alimony is “to get the parties as close as possible to the same standard of living that existed during the marriage,” and we categorized it as “inherently problematic for a trial court to attempt to design an alimony award that advances the overall goal of allowing the parties to go forward with their lives as nearly as possible at the standard of living enjoyed during marriage without first determining what that standard was in the first instance.” See id. ¶¶ 14, 18 (quotations simplified). But we clarified that a court appropriately takes that standard of living into account by “assess[ing] the needs of the parties, in light of their marital standard of living.” Id. ¶ 19 (quotation simplified); see also id. ¶ 15 (noting that trial courts are required “to determine the parties’ needs and expenses . . . in light of the marital standard of living”). The ceiling on a recipient spouse’s alimony award is represented by that spouse’s needs, viewed in light of the marital standard of living. See id. ¶ 17 (“The receiving spouse’s needs ultimately set the bounds for the maximum permissible alimony award.”); see also Vanderzon v. Vanderzon, 2017 UT App 150, ¶ 61, 402 P.3d 219 (stating that “in no case may the trial court award [the recipient spouse] more alimony than [his or] her demonstrated need”); Jensen v. Jensen, 2008 UT App 392, ¶ 13, 197 P.3d 117 (stating that, “regardless of the payor spouse’s ability to pay more, the recipient spouse’s demonstrated need must constitute the maximum permissible alimony award” (quotation simplified)). There is usually no need for a trial court to make a separate specific finding regarding the overall “marital standard of living” as measured by the total amount of money spent each month by the couple while they were married, and we did not intend to imply otherwise in Rule.
¶20 Indeed, in that case we made clear that we were not prescribing any deviation from the “established . . . process to be followed by courts considering an award of alimony.” See Rule, 2017 UT App 137, ¶ 19; see also id. ¶ 13 (citing the statute now codified at Utah Code section 30-3-5(10)(a), and stating that “courts must consider the statutory” alimony factors, which are “the financial condition and needs of the recipient spouse,” “the recipient’s earning capacity,” and “the ability of the payor spouse to provide support” (quotation simplified)). The first step in that process is for the court to “assess the needs of the parties, in light of their marital standard of living.” Id. ¶ 19 (quotation simplified). “This means that the court must determine the parties’ needs reasonably incurred, calculated upon the standard of living enjoyed during the marriage.” Id. (quotation simplified). In the next step, the court must “determine the extent to which the receiving spouse is able to meet [his or] her own needs with [his or] her own income,” and if the receiving spouse “is able to meet all [his or] her needs with [his or] her own income, then [the court] should not award alimony.” Id. (quotation simplified). Finally, and only if the court determines that the recipient spouse cannot meet his or her own needs, the final step in the process is for the court to “assess whether the payor spouse’s income, after meeting his [or her] needs, is sufficient to make up some or all of the shortfall between the receiving spouse’s needs and income.” Id. ¶ 20 (quotation simplified).
¶21 The trial court followed this three-step process in this case. It made twenty-three separate line-item findings regarding DiAnn’s reasonable monthly expenses, using her requested amounts as a starting point, and it adjusted four of the line items downward and three of them upward. The court determined that DiAnn’s reasonable monthly needs, as adjusted, amounted to $25,424.61. And on appeal, DiAnn does not take issue with any of the twenty-three specific line-item findings. That is, she does not assert that any of those particular findings—for instance, her housing expenses, or her automobile expenses—are not in harmony with the marital standard of living.
¶22 The court also made findings regarding DiAnn’s ability to earn income, and determined that her net income (after taxes) was $699 per month for the first two years, and then would be adjusted to $2,915 per month. The court then subtracted her income and the child support payments from her needs, and determined that DiAnn would have a monthly shortfall of $15,039 per month for the first two years, which would narrow to $12,995 per month after that. On appeal, DiAnn does not specifically challenge these calculations, including the court’s findings regarding her ability to earn income.
¶23 Finally, the court assessed whether Ben had the ability to pay DiAnn’s demonstrated shortfall, and determined that he did, even using Ben’s Florida income rather than his St. George income, and even after paying child support and meeting his own reasonable monthly needs. DiAnn’s only complaint about this analysis is that the trial court erred by using Ben’s Florida income for the basis of its computation, as opposed to his St. George income. But DiAnn of course does not quibble with the court’s ultimate conclusion that Ben can meet every dollar of her demonstrated shortfall.
¶24 We perceive no error in the procedure the trial court employed in computing DiAnn’s alimony award. As noted, the court appropriately went through the three-step process required by applicable law. If DiAnn believed that the court inappropriately assessed any of her individual expenses, as measured in light of the marital standard of living, she had every opportunity to challenge any of the specific line-item calculations the court relied on in determining her monthly needs. See Miner, 2021 UT App 77, ¶¶ 20–63 (evaluating an appellant’s challenges to eleven separate line items in a trial court’s calculation of a recipient spouse’s needs). But she does not challenge any of them.
¶25 DiAnn has therefore not carried her appellate burden of demonstrating that the trial court failed to appropriately take into account the marital standard of living in calculating her needs. In this case, the court was not required to make any specific finding regarding how much total money the parties spent each month during the marriage, and it was certainly not required to presumptively award DiAnn half of any such amount as alimony. In short, we perceive no abuse of discretion in the manner in which the court assessed DiAnn’s needs or in which it took into account the parties’ marital standard of living, and on that basis we reject DiAnn’s first challenge to the alimony award.
B. Extracurricular Activities
¶26 DiAnn next contends that the court abused its discretion when it included the minor children’s extracurricular activity expenses in its alimony award to DiAnn. Specifically, she argues that the extracurricular expenses should have been included in an increased child support award instead of the alimony award or, alternatively, that the court should have “issued a separate award equitably dividing the expenses.” We disagree.
¶27 Presumptive monthly child support payment amounts are set by statutory schedule, depending on the incomes of the parents and the precise custody arrangement between them. See Utah Code Ann. §§ 78B-12-205, -212, -301 (LexisNexis 2018). These presumptive monthly payments are designed to include nearly all reasonable needs of children, except for items that are statutorily excluded (such as, for instance, medical expenses and work-related childcare expenses). See Davis v. Davis, 2011 UT App 311, ¶ 17, 263 P.3d 520 (noting that medical expenses and work-related childcare expenses have been “singled out” by the legislature as something that “parents are ordered to pay in addition to their regular child support obligations”). “Child-rearing expenses” that are “not statutorily distinguished from regular child support should be considered part and parcel of the child support award.” Id. (quotation simplified).
¶28 In particular, we have held that “school fees” and “extracurricular activities” are presumed to be included in the “regular child support” payment amount, and ordinarily “must be satisfied, if at all, out of the parties’ combined child support obligations.” Id. ¶¶ 15, 17. Certainly, parties can agree “to share such additional expenses in the interest of their children,” but if they are unable to reach agreement on that score, such expenses “must generally be budgeted as part of child support.” Id. ¶ 15. Thus, in the present case, any expenses associated with the extracurricular activities in which the Fox children participate were designed to be budgeted as part of the $9,760 that DiAnn receives in child support each month.
¶29 Based on Davis, then, the trial court would have been on completely solid ground to decline DiAnn’s request to include a line item of $855 for “extracurricular activities” in her list of monthly expenses for purposes of the alimony calculation. But the court went ahead and included that line item in its computation of DiAnn’s monthly needs for alimony purposes anyway, effectively giving DiAnn an $855 monthly bump in alimony to which she may not have been entitled.[4]
¶30 DiAnn looks this gift horse quite squarely in the mouth and complains that the court should have given her this bonus payment in a different form: by issuing a separate award— consisting of neither child support nor alimony—commanding Ben to pay the extracurricular expenses. Apparently, she is concerned that, if she remarries, Ben’s obligation to pay these expenses will evaporate along with the other alimony line items. Certainly, the trial court could—within the wide discretion afforded trial courts in such matters—have made such an award, provided it adequately explained its reasons for doing so. See id. ¶ 17 (noting that a court can deviate from the presumptive child support guidelines and order a higher amount designed to include “school fees,” but such an order “must be supported by a specific finding on the record supporting the conclusion that use of the guidelines would be unjust, inappropriate, or not in the best interest of the children” (quotation simplified)). But DiAnn falls far short of persuading us that the court abused its discretion by opting not to do so, especially given that she included this line item in her financial declaration, which was the basis for her alimony request. On this basis, we reject DiAnn’s second challenge to the court’s alimony award.
II. Marital Debt
¶31 DiAnn next asserts that the trial court abused its discretion when it divided the marital debt in such a way as to give her full responsibility for the parties’ $181,000 obligation owed to DiAnn’s father, and then included a $2,500 line item for payments servicing that debt in DiAnn’s alimony award (thereby effectively requiring Ben to pay that debt as part of his alimony obligation). We perceive no abuse of discretion in the trial court’s orders regarding the marital debt owed to DiAnn’s father.
¶32 In issuing a divorce decree, a trial court must include “an order specifying which party is responsible for the payment of joint debts, obligations, or liabilities of the parties contracted or incurred during marriage.” Utah Code Ann. § 30-3-5(2)(c)(i) (LexisNexis Supp. 2021). Importantly, our law requires only “a fair and equitable, not an equal, division of the marital debts.” Sinclair v. Sinclair, 718 P.2d 396, 398 (Utah 1986) (per curiam). And as already mentioned, because trial courts are in the “best position to weigh the evidence, determine credibility and arrive at factual conclusions, they have considerable latitude” in dividing marital debt, and their actions in this regard “are entitled to a presumption of validity.” Mullins v. Mullins, 2016 UT App 77, ¶ 20, 370 P.3d 1283 (quotation simplified).
¶33 In the present case, we cannot say that the trial court abused its discretion in assigning the marital debt owed to DiAnn’s father to DiAnn. By way of counterbalance, the court assigned Ben full responsibility for his medical school debts (totaling some $145,000), and made each party responsible for the debts on their respective vehicles. This division makes practical sense, because it relieves DiAnn of any responsibility for debts associated with Ben’s medical education, and it relieves Ben of any direct responsibility (aside from alimony) for debts owed to DiAnn’s father. The court recognized, however, that this distribution of debts gave DiAnn “approximately $24,000 more in debts” than it gave Ben, but the court stated that it would “use its distribution of property to equalize this imbalance of debts.” DiAnn makes no argument that the court failed to remedy this imbalance. Indeed, the court awarded the parties’ timeshare condominium in Hawaii to DiAnn alone, and it also awarded DiAnn three of the four cars owned by the parties. Additionally, the court awarded DiAnn an offset of $10,000 “to compensate her for any dissipation of the marital estate” on the part of Ben, and also awarded her $50,000 for attorney fees from any proceeds made from the sale of the marital house prior to the parties evenly splitting any remaining proceeds. Under the circumstances presented here, DiAnn has not demonstrated any inequity or abuse of discretion in the manner in which the court divided the parties’ marital debts.
¶34 Furthermore, while DiAnn was indeed assigned responsibility for the entire debt owed to her father, a line item for the $2,500 monthly payment of that debt was included in her alimony award. Thus, while the court made DiAnn responsible for that debt, it is Ben, and not DiAnn, who is (at least indirectly) paying for it. DiAnn nevertheless complains about this seemingly favorable arrangement, again expressing concern that, if she were to remarry, Ben’s obligation to front her the money to service the debt owed to her father would evaporate along with the other alimony line items. Perhaps a trial court, within the scope of its discretion, could have done what DiAnn envisions. But under the specific facts of this case, it is not an abuse of discretion for the court to have equitably divided the debt, and then to have required Ben to pay DiAnn an alimony amount that includes the debt service payments on the obligation owed to DiAnn’s father. Given the circumstances as they existed at the time of trial, DiAnn has not demonstrated that the court’s orders regarding the parties’ debt to DiAnn’s father exceeded the court’s wide discretion in such matters.
III. Voluntary Underemployment
¶35 Finally, DiAnn argues that the trial court abused its discretion when it found, for purposes of calculating child support and alimony, that Ben was not voluntarily underemployed. Specifically, DiAnn asserts that because Ben took a job in Florida that paid him less than what he had been making in St. George, the court should have concluded that Ben is voluntarily underemployed and should have calculated child support and alimony based on Ben’s previous St. George salary.
¶36 As an initial matter, we note that this entire issue is irrelevant to the alimony computation, given our determination (discussed above) that the trial court did not abuse its discretion in making its alimony award. Even using Ben’s Florida salary for purposes of computing Ben’s income, the trial court found that Ben had the financial ability to make up 100% of the difference between DiAnn’s income and her reasonable needs. See supra ¶¶ 19, 23–24. Thus, even if we were to agree with DiAnn that Ben was voluntarily underemployed and that the trial court should have used his St. George salary in computing his income, DiAnn’s alimony award would not change. But because the issue could still matter to the child support calculation, we proceed to address the merits of DiAnn’s challenge to the trial court’s findings regarding voluntary underemployment.
¶37 “A court may impute income to an underemployed spouse.” Rayner v. Rayner, 2013 UT App 269, ¶ 7, 316 P.3d 455 (quotation simplified). In order to do so, however, the court must determine that the spouse “is voluntarily . . . underemployed.” Id. (quotation simplified). We agree with DiAnn that Ben’s employment actions—in taking a new job in Florida—were voluntary. See id. (“A spouse is voluntarily unemployed or underemployed when he or she intentionally chooses of his or her own free will to become unemployed or underemployed.” (quotation simplified)). But DiAnn has not persuasively demonstrated that the trial court abused its discretion in determining that Ben was not underemployed.
¶38 The determination as to whether a party is underemployed requires examination of all the relevant circumstances, and not just whether a party’s salary has recently dropped. Indeed, a party’s “current earnings, as compared to his [or her] historical income, is merely one element in the matrix of factual issues affecting the ultimate finding of whether [a party] is underemployed.” Hall v. Hall, 858 P.2d 1018, 1026 (Utah Ct. App. 1993); see also Vanderzon v. Vanderzon, 2017 UT App 150, ¶ 65, 402 P.3d 219 (stating that “income imputation shall be based upon employment potential and probable earnings as derived from employment opportunities, work history, occupation qualifications, and prevailing earnings for persons of similar backgrounds in the community” (quotation simplified)).
¶39 In the present case, the trial court did not abuse its discretion in finding that Ben was not underemployed. Certainly, Ben’s income is lower in Florida than it was in St. George. And a drop in income can be an important factor in determining that a spouse is underemployed. See, e.g., Arnold v. Arnold, 2008 UT App 17, ¶ 7, 177 P.3d 89. But the mere fact that a spouse’s income has fallen does not necessarily mandate a finding of underemployment.[5] In the present case, the court was presented with ample evidence to support its determination that Ben— despite his lower salary—was not underemployed. Ben had not left his profession—he was employed as a neurosurgeon in St. George, and he was employed as a neurosurgeon in Florida. And even in Florida, Ben still made a lot of money; indeed, Ben’s expert testified that Ben’s Florida salary—nearly $1 million per year— was above the 90th percentile for neurosurgeons nationwide, not just for doctors. The trial court also credited Ben’s testimony that the work schedule he had been maintaining in St. George was not sustainable, and that he was “over-worked and burnt out.” And in Florida, Ben was still working 50 to 60 hours per week, up to half again as much as a typical full-time job. All of this evidence supports the court’s finding that Ben was not underemployed, voluntarily or otherwise.
¶40 Under these circumstances, we cannot say the court abused its discretion in finding that Ben was not voluntarily underemployed. While the court’s determination was perhaps not the only permissible one under the circumstances, it is “entitled to a presumption of validity,” Mullins v. Mullins, 2016 UT App 77, ¶ 20, 370 P.3d 1283 (quotation simplified), was supported by competent evidence, and did not constitute an abuse of discretion.
CONCLUSION
¶41 We perceive no abuse of the trial court’s discretion in its alimony award, its division of marital debts, or its determination that Ben was not voluntarily underemployed. On that basis, we reject DiAnn’s appellate challenges.
What are the most important changes to the family law in the 19th century and 20th century up to today, and why?
In my opinion (and in no particular order):
No-fault divorce
Abolition of the doctrine of coverture (femme couvert)
Tender Years doctrine (and the abrogation of the Tender Years doctrine)
Statutory child support
Same sex marriage
We need to get one misconception out of the way immediately, and that is that wives were treated as the husband’s property in the past. They were not.
This does not mean that women were treated differently than men and husbands under the law, but women were not treated as their husbands’ property and unmarried women could own property and enter into contracts. See Husband and Wife Are One–Him: Bennis v. Michigan as the Resurrection of Coverture (4 MIJGL 129, Amy D. Ronner Michigan Journal of Gender & Law)
At common law, an adult single woman could own, manage and transfer property. She could sue and be sued. She could likewise earn money and enjoy it as her own. Once that same woman married, however, her status changed radically; coverture subsumed her legal identity into her husband’s.
Blackstone described coverture status as follows:
By marriage, the husband and wife are one person in law: that is, the very being or legal existence of the woman is suspended during the marriage, or at least is incorporated and consolidated into that of husband: under whose wing, protection, and cover, she performs everything; and is therefore called in our law-French a feme covert, foemina viro co-operta; is said to be covert-baron, or under the protection and influence of her husband, her baron, or lord; and her condition during her marriage is called her coverture. Upon this principle, of an [sic] union of person in husband and wife, depend almost all the legal rights, duties and disabilities, that either of them acquire by the marriage. The coverture doctrine prevented a man from granting anything to his wife or from entering into a contract with her. Such actions would be futile because they would “suppose her separate existence . . . and to covenant with her, would be only to covenant with himself.”
The coverture merger was not mere metaphysics, but imposed real disabilities on the married woman. For example, a wife relinquished the control of her real property to her “baron” and although he could not alienate the rents and profits, he was not obligated to account for them to her. Moreover, her husband enjoyed complete control of his wife’s interests, which meant that he could alienate them and unilaterally pocket the proceeds. All chattels that a woman owned at the time of marriage and those she acquired thereafter belonged to her husband. The suspension of a wife’s legal identity also meant that she could not sue or be sued at law unless her husband had joined in the action or “ha[d] abjured the realm, or is banished.”
Coverture prohibited husband and wife from testifying for or against each other in trials “principally because of the union of person.” That is, such testimony would be irrebuttably presumptively self-serving or self-incriminating. In criminal law, a husband and wife could not comprise a conspiracy because one person could not conspire with himself. They also could not steal from one another because the property belonged essentially to only one–him. In other situations the wife was utterly divested of free will and viewed as “inferior to him, and acting by his compulsion.” For example, because certain criminal acts on her part, short of treason or murder, were viewed as if done under his “command,” coverture bestowed upon the married woman a specie of immunity.
Utah Family Law, LC | divorceutah.com | 801-466-9277
JAMES M. DUFFIN III,
Appellee and Cross-appellant,
v. BRANDY E. DUFFIN,
Appellant and Cross-appellee.
Opinion
No. 20200361-CA
Filed May 12, 2022
Third District Court, West Jordan Department
The Honorable Matthew Bates
No. 184400962
T. Jake Hinkins and Kurt W. Laird, Attorneys for Appellant and Cross-appellee
Martin N. Olsen and Beau J. Olsen, Attorneys for Appellee and Cross-appellant
JUDGE DAVID N. MORTENSEN authored this Opinion, in which JUDGES MICHELE M. CHRISTIANSEN FORSTER and RYAN M. HARRIS concurred.
MORTENSEN, Judge:
¶1 In prototypical fashion, a young married couple—James and Brandy Duffin[1]—set about building a new house. They prequalified for a loan, hired a real estate agent, paid a deposit of $1,000 with marital funds, entered into a contract with a builder, went to a design center to pick out finishes, and attended the closing together. However, in atypical fashion, James’s father and grandfather reimbursed the $1,000 deposit, paid an additional $18,000 as a preconstruction deposit, and at closing paid the balance of the purchase price of $410,875 in cash. Only James’s name was placed on the deed. Months later, as James and Brandy’s marriage relationship deteriorated, James deeded the property to himself and his father. A divorce action was filed, and at trial, the district court concluded, among other things, that any interest James and Brandy had in the house was not marital property and that Brandy should be awarded attorney fees. Brandy appeals, claiming that any interest she and James have in the house is a marital interest. James cross-appeals, challenging the determination on fees. We reverse the district court’s determination regarding the house, but we affirm the decision regarding attorney fees.
BACKGROUND
¶2 Brandy and James were married in March 2015. They had two children during their union.
¶3 In April 2016, Brandy and James, having been approved for a loan of up to $360,000, entered into a real estate purchase agreement to purchase a house in West Jordan, Utah. Using a cashier’s check from an account in his name, James paid a security deposit of $1,000 on the contract.[2] James testified that his father (Father) reimbursed him for the $1,000, though he could not remember how that reimbursement occurred.
¶4 In June 2016, James’s grandfather (Grandfather) paid $18,000 for the preconstruction deposit, but James asserted that the money was actually an advance on Father’s inheritance from Grandfather. At closing, Father paid the outstanding balance on the home, again with money allegedly received as an advance on his own inheritance.
¶5 On February 8, 2017—the day before closing—James sent an email, titled “Loan Contract,” to Father stating that Father “is dispensing a loan of $429,875.42 to purchase a home,” which was identified as the house for which James and Brandy had signed the real estate purchase agreement. In that document, James identified himself as the party responsible for repayment of the loan. Notably, the Loan Contract did not mention interest or a payment schedule; rather, it provided that Father could “demand payment of this loan at anytime.”
¶6 Brandy and James moved into the completed house. A warranty deed conveying title of the house from the seller to James—Brandy’s name does not appear on the deed—was recorded on February 9, 2017.
¶7 About a year later, in February 2018, James added Father to the title of the house by executing and recording a new warranty deed. Brandy contended that the “marriage was struggling and divorce was a very real possibility” at the time James added Father to the title of the property.
¶8 As it turns out, Brandy and James separated in July 2018, and James petitioned for divorce in August 2018. James further asked that the assets and liabilities of the marital estate be divided equitably and that the parties bear their own attorney fees and costs.
¶9 As relevant here, in his financial declaration, submitted in October 2018, James listed the house as an asset with no amount owing, noting that it was a “[c]ash purchase” by Father and that it was acquired in his and Father’s names.
¶10 In her counter-petition, in addition to addressing custody and parent-time issues, Brandy requested that the house be sold and the equity split equally. Brandy also asked for attorney fees.
¶11 James later asserted—during the divorce proceedings— that he purchased the house on behalf of Father, who lived in California, and that he was just doing the “leg work” for Father. He also asserted that he and Brandy “weren’t prequalified on [their] own merits” but had used Father’s bank statements in the application.[3] However, James admitted that he never informed anyone that he was acting as the agent of Father. And James conceded that he was not aware of “written documentary evidence” indicating an agency relationship but that there were “certainly conversations” between him and Father to that effect.[4] James also contended that an agreement between him and Father gave James the option to purchase the house from Father.
¶12 Father echoed much the same in his deposition on the matter, saying that he had “been talking to [James] about purchasing a home for [him] in Utah for quite some time” and that James acted on his behalf in purchasing the house. Father explicitly stated that he “[a]bsolutely” never intended the house to be a gift to James. Father clarified, “I provided all the money. My son worked as my agent in obtaining that house. And it was always understood between my son and me that that was my house.” But Father admitted that there was no document that would evidence any sort of an agency relationship between them.
¶13 Father explained that his name was not on the deed to the house because he “wanted to empower” James by having him “go through the process” of purchasing a house. Father asserted that he was involved in the design of the house and “oversaw the whole thing.” But he admitted there were “no writings, no emails or text messages between the two of [them] about the house plans.” Rather, Father explained, “[I]t was just a . . . casual, loving, walking down the street, arm around my son,” asking, “What do you think, Jim?”
¶14 Father indicated that he needed to “subsidize the relationship [between James and Brandy] until it really got off . . . on a good start.” However, Father indicated that Brandy was never involved in the conversations about the help he was extending to them: “The whole . . . financial situation, . . . my support, my allowing them to live in that house, all of that was between me and my son.”
¶15 For her part, Brandy testified that there was never any discussion that the house would belong to anyone other than her and James. Specifically, she said there was never any mention made to her that the house was being built for Father or that Father had any input on the construction. She clarified that she and James “picked out all of the finishings” and the floor plan of the house. Brandy testified that at no time during construction did James ever indicate that he needed to check with Father to verify that he was “okay” with their design selections because it was going to be Father’s house. In terms of paying for the house, Brandy stated that she and James were prequalified for a loan on the house, that the $1,000 deposit was paid with a cashier’s check funded with money from their commingled accounts, and that she and James were present together at the closing. Brandy further testified that she and James completed the landscaping and added, among other features, a fence, basketball standard, and cement pad.
¶16 With regard to the house, the court found that it was not marital property. The court reasoned,
The parties went into this home with the expectation that they would purchase it together. They picked the lot, they picked the design of the home, they selected trim and other finishings in the home, and they entered into a [real estate purchase agreement] with [the seller], and the parties expected that they would have a mortgage and that they would pay for this home using their respective incomes. But when it came time to actually close on this transaction, that is not what happened. Instead, [Father] paid for the home in its entirety, and James was the only one who was put on the deed.
¶17 The court went on to note that James and Brandy “lived in the home for what is a relatively short duration. They did not pay rent, they did not pay any sort of mortgage or loan, they did not pay utilities or property taxes. Those were all paid by income from [Father] towards the home.” And even though James and Brandy did “contribute somewhat to the home by putting in some shrubberies, a basketball standard, putting down a concrete pad, [and] installing a small fence,” the court concluded that “given the large amount of equity in this home, upwards of $450,000, those small contributions . . . [did] not convert [the house] into a marital asset.”
¶18 The court concluded,
[The house] was an asset that was titled only in James’s name. It was paid for by [Father]. . . . To determine that it was a marital interest would essentially be to give to Brandy a tremendous windfall of something that was not acquired in any rational sense of the word by the efforts of the marriage or the work or efforts of the marriage. So to the extent that there is any interest in the home, it is not a marital interest and to the extent that James has an interest in the home, it is not a marital interest.[5]
¶19 Lastly, the court awarded attorney fees to Brandy, at least in part:
Given the parties’ respective incomes, particularly that James has income a little bit more than four times the income that Brandy has, Brandy has a need for assistance in paying her attorney’s fees [and] those fees were necessary for her to be able to defend herself in this divorce action. However, she did not prevail 100 percent on all of her claims[6] and everything she was seeking, so the Court hereby awards her 60 percent of her attorney’s fees.
¶20 Both parties appeal, Brandy with respect to the determination that any interest she and James had in the house was not marital property, and James with respect to the award of attorney fees.
ISSUES AND STANDARDS OF REVIEW
¶21 Brandy contends that the district court erred in concluding that any interest she and James had in the house acquired during the course of the marriage was not marital property and thus not subject to distribution. “We will not disturb a property award unless we determine that there has been a misunderstanding or misapplication of the law resulting in substantial and prejudicial error, the evidence clearly preponderates against the findings, or such a serious inequity has resulted as to manifest a clear abuse of discretion.” Nakkina v. Mahanthi, 2021 UT App 111, ¶ 16, 496 P.3d 1173 (cleaned up).
¶22 In his cross-appeal, James contends that the district court erred in ordering him to pay 60% of Brandy’s attorney fees pursuant to Utah Code section 30-3-3(1). “We review the district court’s award of attorney fees under Utah Code section 30-3-3, including the amount of the award, for abuse of discretion.” Eberhard v. Eberhard, 2019 UT App 114, ¶ 6, 449 P.3d 202.
ANALYSIS
I. The Status of the Parties’ Putative Interest in the House as Marital Property
¶23 “Marital property is ordinarily all property acquired during marriage and it encompasses all of the assets of every nature possessed by the parties, whenever obtained and from whatever source derived.” Marroquin v. Marroquin, 2019 UT App 38, ¶ 14, 440 P.3d 757 (cleaned up). “Separate property, in contrast, is typically a spouse’s premarital property or property received by gift or inheritance during the marriage.” DeAvila v. DeAvila, 2017 UT App 146, ¶ 15, 402 P.3d 184.
¶24 “In Utah, marital property is ordinarily divided equally between the divorcing spouses and separate property, which may include premarital assets, inheritances, or similar assets, will be awarded to the acquiring spouse.” Olsen v. Olsen, 2007 UT App 296, ¶ 23, 169 P.3d 765. Specifically,
When dividing property in a divorce, the court should first properly categorize the parties’ property as part of the marital estate or as the separate property of one or the other. Then, the court should presume that each party is entitled to all of that party’s separate property and one-half of the marital property, regardless of which spouse’s name appears on the title to the marital property.
Allen v. Ciokewicz, 2012 UT App 162, ¶ 46, 280 P.3d 425 (cleaned up); see also Bradford v. Bradford, 1999 UT App 373, ¶ 26, 993 P.2d 887 (stating that marital property may be distributed equitably “regardless of who holds title”).
¶25 Here, the district court erred in its determination that insofar as James or Brandy had a property interest in the house, that interest was not marital.
¶26 Throughout the pendency of the divorce proceedings, James explicitly rejected the notion that the house was a gift. And there is no indication in the record that James received the house as part of his inheritance. Nor was the house James’s premarital asset—it was indisputably acquired during the marriage. Thus, there is no evidence to suggest that any interest James might have in the house qualifies as James’s separate property. See Keiter v. Keiter, 2010 UT App 169, ¶ 22, 235 P.3d 782 (“Generally, premarital property, gifts, and inheritances may be viewed as separate property, and the spouse bringing such separate property into the marriage may retain it following the marriage.” (cleaned up)).
¶27 But there is ample evidence that any interest James and Brandy had in the house was marital property. Brandy and James both signed the real estate purchase agreement. As the district court explicitly noted, they both entered into the agreement with the expectation that they were purchasing the house together and that they would have a mortgage together. They picked the lot, they paid a $1,000 deposit, they selected the design, and they chose the finishings. The two factors that the district court pointed to as indicating that the house was not marital property were that James was the only one on the deed and that Father paid for the house in its entirety. But neither of these circumstances is sufficient to transform whatever interest James and Brandy have in the house from marital property to separate property.
¶28 First, that Brandy was never on the deed to the house in no way indicates that any interest James and Brandy might have in the house was somehow not marital property. In fact, just the opposite is true. “[A] marital asset is defined functionally as any right that has accrued during the marriage to a present or future benefit.” Jefferies v. Jefferies, 895 P.2d 835, 837 (Utah Ct. App. 1995). By having his name entered into the warranty deed and having his name placed on the title, James obtained the house in fee simple. See Utah Code Ann. § 57-1-12(2) (LexisNexis 2020). And because he obtained title during the marriage—and because the house was not a gift or inherited—whatever interest he had in the house became marital property. See Marroquin, 2019 UT App 38, ¶ 14 (defining marital property as “all property acquired during marriage” (cleaned up)). In other words, once James acquired title, Brandy acquired title because the acquisition took place during the marriage, and there was no exception (i.e., gift or inheritance) indicating otherwise.
¶29 Second, that Father paid for the house also fails to render “nonmarital” any interest James and Brandy might have in it. As our case law makes abundantly clear, “marital property ordinarily includes all property acquired during marriage, whenever obtained and from whatever source derived.” Lindsey v. Lindsey, 2017 UT App 38, ¶ 31, 392 P.3d 968 (cleaned up); accord Marroquin, 2019 UT App 38, ¶ 14; DeAvila, 2017 UT App 146, ¶ 15; Dunn v. Dunn, 802 P.2d 1314, 1317–18 (Utah Ct. App. 1990). That James and Brandy used someone else’s money to purchase the house does not—standing alone—make their interest in the house nonmarital property. Most people, when they purchase a home, use someone else’s money (usually a lender’s) to do it—indeed, Father providing the money to purchase the house looks somewhat like just such a loan. And granted, the source of money by which the house was acquired would potentially render James’s interest in the house nonmarital if Father had gifted the money to James alone or if it represented James’s inheritance. But that’s not what happened here. As already noted, the record does not support a conclusion that the money was a gift to James or part of his inheritance, and the district court did not conclude otherwise.
¶30 On this note (i.e., that Father paid for the house while James and Brandy made a minimal contribution), the district court, citing Jefferies v. Jefferies, 895 P.2d 835 (Utah Ct. App. 1995), and Dunn v. Dunn, 802 P.2d 1314 (Utah Ct. App. 1990), concluded, “These cases suggest that marital property is not just any property obtained, but property that is obtained through the efforts of the marriage, and suggests that a windfall to one party or the other may not necessarily be marital property.” From this “suggestion” that it perceived in these two cases, the district court concluded that James and Brandy did not contribute sufficiently to the house to make any interest they might have in it marital property.
¶31 But obtaining property “through the efforts of the marriage” is not the defining condition that makes property marital; rather, it is the mere acquisition of property during marriage. As this court has often repeated, “marital property ordinarily includes all property acquired during marriage, whenever obtained and from whatever source derived.” Lindsey, 2017 UT App 38, ¶ 31 (cleaned up). Our case law nowhere mentions “the efforts of the marriage” as being necessary to making property so acquired marital. Thus, acquisition—from whatever source—during the marriage is the hallmark condition that renders property marital, not the maintenance or growth of that property by the efforts of the parties. To be clear, our case law employs the modifier “ordinarily” to account for the situation where property acquired by “gift or inheritance during the marriage,” see DeAvila, 2017 UT App 146, ¶ 15, remains separate property unless it has been transformed to marital property by commingling or the contribution of the non-receiving spouse, see Keyes v. Keyes, 2015 UT App 114, ¶ 28, 351 P.3d 90 (stating that “separate property, which may include premarital assets, inheritances, or similar assets, will be awarded to the acquiring spouse” unless it loses “its separate character . . . through commingling or if the other spouse has by his or her efforts or expense contributed to the enhancement, maintenance, or protection of that property” (cleaned up)). Thus, the district court’s misstep here was in applying the concept of “the efforts of the marriage” as a condition for all property acquired during the course of a marriage to become marital, when our case law has limited that concept to the efforts of the non-receiving spouse in transforming separate property into marital property.
¶32 In sum, we reverse the district court’s determination that the couple’s property interest in the house, insofar as they had an interest, was not marital. The extent to which Brandy and James even have an interest in the property is an issue that will be decided in the separate lawsuit. See supra note 5. But to the extent they are adjudicated to have an interest in the house, that interest is marital property subject to equitable distribution between them.
II. The Award of Attorney Fees
¶33 On appeal, James asserts that the district court erred in awarding Brandy attorney fees because it did not make a detailed factual analysis of either Brandy’s financial need for assistance or James’s ability to pay and because the district court took into account whether Brandy prevailed on her claims. These challenges raise different legal theories from the ones James raised below with regard to Brandy’s attorney fees request.
¶34 “Parties are required to raise and argue an issue in the [district] court in such a way that the court has an opportunity to rule on it.” State v. Johnson, 2017 UT 76, ¶ 18, 416 P.3d 443 (cleaned up). “When a party fails to raise and argue an issue in the district court, it has failed to preserve the issue, and an appellate court will not typically reach that issue absent a valid exception to preservation.” Issertell v. Issertell, 2020 UT App 62, ¶ 21, 463 P.3d 698 (cleaned up). “As to preservation, our case law draws a distinction between new ‘issues’ (like distinct claims or legal theories) and new ‘arguments’ in support of preserved issues (such as the citation of new legal authority).” Hand v. State, 2020 UT 8, ¶ 6, 459 P.3d 1014.
¶35 Here, James is clearly trying to raise new issues. Below, James did not challenge the court’s analysis regarding Brandy’s financial need or his ability to pay. In fact, James explicitly challenged only the inclusion of fees associated with a protective order, the exclusion of certain reimbursements Brandy had received, the court’s handling of rule 54(d) of the Utah Rules of Civil Procedure as it applies to costs, and the exclusion of the costs James had paid for a custody evaluation. Nowhere did he assert that the court should not award Brandy attorney fees due to his or Brandy’s financial situation. In short, the legal theories he raised below in challenging Brandy’s attorney fee request were entirely different from the legal theories he attempts to raise now. He simply never gave the district court an opportunity to rule on the theories he now advances.
¶36 Because James failed to raise the same challenges to Brandy’s request for attorney fees that he is attempting to raise on appeal, his current challenges are unpreserved, and James does not ask us to apply any of the traditional exceptions to our preservation requirement.[7] On that basis, we decline to review the merits of James’s unpreserved challenges to the award of attorney fees.
CONCLUSION
¶37 Having concluded that to the extent the couple had a property interest in the house, the interest was marital, we reverse and remand for further proceedings consistent with this opinion. And we uphold the award of attorney fees to Brandy because the legal theories advanced on appeal were not preserved.
[1] Because the parties share the same last name, we refer to them by their given names.
[2] Brandy asserted that the cashier’s check was funded with commingled monies from her and James. See infra ¶ 15. James admitted that money from Brandy’s income may have gone into the account from which the cashier’s check was drawn.
[3] James’s name is identical to Father’s, with the exception of the suffix.
[4] James acted as agent for Father for the purchase of a different “property six houses away.” Indeed, the record contains another real estate purchase contract under Father’s name and address (as opposed to James and Brandy’s) that was signed by James. The record contains at least one piece of correspondence addressed to Father at this address.
[5] The court spoke in conditional terms about the extent of interest in the house—as do we—because Father has filed a pending quiet title action asserting his interest in the property.
[6] Brandy prevailed on various claims related to custody and child support.
[7] James argues that the court plainly erred in awarding attorney fees. But after his brief was submitted, this court held “that plain error review is not available in ordinary civil cases.” See Kelly v. Timber Lakes Prop. Owners Ass’n, 2022 UT App 23, ¶ 44, 507 P.3d 357. Accordingly, the plain error exception to our preservation rule does not apply to this situation.
James also argues that “rare procedural anomalies . . . prevented [him] from fully providing the [district court] the legal arguments and evidence to support the denial of Brandy’s request for attorney fees.” The “rare procedural anomaly” James identifies is the court’s statement that it was “very familiar with the state of the law with respect to attorneys fees under 30-3-3” such that it did not need “further briefing on this matter.” James argues that precluding him “from putting forth evidence and appropriate briefing rises to the level of an anomaly in the proceedings.” But we see no procedural anomaly that would have prevented James from raising the issue in a post-judgment motion, just as he did with his other challenges to the award of attorney fees.
Ryan A. Rudd and Nicholas S. Nielsen, Attorneys for Appellee
JUDGE DAVID N. MORTENSEN authored this Opinion, in which JUDGES GREGORY K. ORME and JILL M. POHLMAN concurred.
MORTENSEN, Judge:
¶1 When Vicki and Randall Beckham came before the district court for a bench trial on a divorce petition, Vicki[1] asked the court to order that she be a named beneficiary under one of the then-existing term life insurance policies on Randall. The court denied this request, a determination with which neither party takes issue. Despite both parties acknowledging that the policy had no value, however, and while expressly noting that the policy was not presented in evidence, the district court ordered Randall to reimburse Vicki the premiums she had paid for this “asset” for several years to the tune of $40,000. Randall appeals, claiming the district court erred in this award. We agree and reverse.
¶2 During the divorce proceeding, Vicki and Randall disputed how two term life insurance policies on Randall’s life should be treated. Vicki asserted that the court should award her a beneficiary interest in one of the policies. In ruling on the matter, the district court noted that the parties had failed to provide the court “with the policies at issue” and that it was “unclear whether these term life insurance policies were renewable by year, or after a number of years, or ended upon Randall’s death, or were terminated in the event of a divorce.” The court also stated that “Vicki’s counsel argued that they did not receive the policy in discovery,” and citing rule 37 of the Utah Rules of Civil Procedure, the court opined that “if that [was] the case, that issue could have and should have been resolved through the appropriate pretrial procedure.” See Utah R. Civ. P. 37(a)(1)(E) (“A party . . . may request that the judge enter an order . . . compelling discovery from a party who fails to make full and complete discovery.”).
¶3 Although the court determined that it “may award a life insurance beneficiary interest to a spouse upon divorce, under general principles of law concerning the apportionment of marital assets,” it declined to do so, reasoning that Vicki did not have a financial need for the insurance benefits, that the parties never reached an understanding regarding the apportionment of the life insurance policies, and that there was “no reason to perpetuate a relationship between” the parties by granting Vicki a beneficiary interest in a policy on Randall’s life. Accordingly, the court concluded that the policies would “remain with Randall” and that he would “continue to control the beneficiary designation going forward.”
¶4 However, the court found that the parties had treated the “two policies as marital assets during the marriage,” that each party had “spent a significant amount on annual premiums,” that the “policies were clearly part of the parties’ future planning and provided a benefit to them,” and that the “evidence was clear that each party used their own funds to pay for the respective policies.”
¶5 Accordingly, the court determined that Vicki should be reimbursed for her contribution to the premiums of one of the policies:
[I]n the interest of fairness and equity, Vicki should be awarded $40,000 from Randall to reimburse her for the annual premiums she paid for the policy over the past eight years. The testimony at trial was very clear that each party used their own funds to pay for the respective policies. Thus, Vicki contributed to an asset that will remain with Randall; it is thus fair and equitable for him to reimburse her for the amounts she paid—amounts that have maintained the policy and allowed Randall to perpetuate that [p]olicy on behalf of his newly named beneficiaries.
Randall appeals, asserting that the district court should not have ordered reimbursement of premiums paid during the marriage.
ISSUE AND STANDARDS OF REVIEW
¶6 Randall argues that the district court erred “in invoking its equitable powers to order [him] to reimburse [Vicki] for term life insurance policy premiums paid during the marriage.” “A district court has considerable discretion considering property division in a divorce proceeding, thus its actions enjoy a presumption of validity. We will disturb the district court’s division only if there is a misunderstanding or misapplication of the law indicating an abuse of discretion.” Johnson v. Johnson, 2014 UT 21, ¶ 23, 330 P.3d 704 (cleaned up). And “[w]hen a district court fashions an equitable remedy, we review it to determine whether the district court abused its discretion.” Collard v. Nagle Constr., Inc., 2006 UT 72, ¶ 13, 149 P.3d 348; accord Kartchner v. Kartchner, 2014 UT App 195, ¶ 14, 334 P.3d 1.
ANALYSIS
¶7 In a divorce proceeding, a district court is empowered to enter “equitable orders relating to the children, property, debts or obligations, and parties.” See Utah Code Ann. § 30-3-5(1) (LexisNexis Supp. 2021). Here, the district court characterized the life insurance policy as a marital asset. Citing Utah Code section 30-3-5, the court noted its authority to divide marital assets and indicated that the parties had “treated” the policy as a “marital asset[] during their marriage” and that “Vicki contributed to an asset that will remain with Randall.”
¶8 The court explicitly acknowledged that it did not have access to the life insurance policies because the parties did not provide them to the court.[3] Given this lacuna, the court acknowledged that it was “unclear whether these term life insurance policies were renewable by year, or after a number of years, or ended upon Randall’s death, or were terminated in the event of a divorce.” But the court also noted that Vicki “could have and should have” resolved the lack of production “through the appropriate pretrial procedure,” presumably a statement of discovery issues seeking to compel discovery. See Utah R. Civ. P. 37(a)(1)(E).
¶9 Given the court’s acknowledgment that it was unaware of the nature of the policy, it follows that it was equally unaware whether the policy was still in effect or if it had cash value. Indeed, Vicki took the position at trial that the insurance policy had no value: “[T]hese . . . term life insurance policies . . . don’t have value. It’s contingent upon an act.” And she explicitly stated that the policy had no “cash value” and was limited to “[j]ust the death benefit.” Randall also took the position that the policy had “no value.” Neither the district court’s findings of fact and conclusions of law nor the parties’ briefs on appeal point to any record basis on which to base a conclusion that the insurance policy retained any value. Instead, all the value related to the policy—as far as the record indicates—was consumed during the marriage.[4]
¶10 Accordingly, Vicki was not entitled to reimbursement for the premiums for the simple reason that either she or the marital estate received the value—in the form of mitigating the risk in the event of Randall’s death—of the premiums she paid. Short of collecting on a claim, mitigation of risk is generally the very nature of the benefit one receives from insurance. Vicki may indeed be entitled to reimbursement if the premiums had enhanced the value of Randall’s estate to her exclusion. But on the record before us, the payment of the insurance premiums did not enrich Randall such that he continued to enjoy—to the exclusion of Vicki—the benefit of the premiums after the divorce. Or put another way, there is no record evidence that Randall “is retaining some sort of good purchased with the money” spent on the life insurance premiums. See In re Marriage of Fluent, No. 16-1321, 2017 WL 2461601, at *3 (Iowa Ct. App. June 7, 2017).[5] Rather, the only conclusion that the sparse evidence could sustain is that the “benefit” of the insurance premiums was received by Vicki during the corresponding terms of life insurance coverage. And this benefit consisted of protection from the risk associated with Randall’s potential death during each of the paid terms of the policy—a benefit that was consumed in each term. But after each paid term lapsed, Randall did not retain some benefit from the premiums—or at least there is no record evidence of a retained benefit. Thus, the premiums were not reimbursable to Vicki because she—or the marital estate—had already received the value of those premiums in the coverage the insurance policy provided on Randall’s life during the marriage.
¶11 Expressed differently, the premiums were a paid-for resource that had been consumed—like many household expenditures—during the marriage. And like the money paid for any other proper living expense incurred during a marriage, the money paid for the insurance premiums was not reimbursable upon divorce because the value of the expense associated with that item—in this case, assurance against risk provided by insurance premiums—was used up during the marriage. See Heckler v. Heckler, No. FA040084101S, 2005 WL 529940, at *1–2 (Conn. Super. Ct. Jan. 27, 2005) (denying, in a divorce proceeding, a husband’s request that his former wife reimburse him for “certain living expenses he paid on the wife’s behalf during the marriage”); see also Czepiel v. Allen, No. FA 9886060, 1999 WL 99097, at *1 (Conn. Super. Ct. Feb. 16, 1999) (“The court does not allow reimbursement for telephone bill expenses or other household expenses [that] were joint undertakings of their family . . . .”). The insurance premiums Vicki paid—even if they did proceed from her own earnings—were akin to the living expenses that are “part and parcel” of the daily marital undertaking. See Czepiel, 1999 WL 99097, at *2. As such, they were not reimbursable to her upon divorce as she had already received the value she bargained for in voluntarily assuming the expense of the premiums.
¶12 Thus, the expenditures for the insurance premiums fell into the category of normal living expenses voluntarily paid from marital assets, and they were not subject to reimbursement because they had been entirely exhausted and consumed in paying for a marital expense, namely, buying life insurance for Randall—from which Vicki would have benefited had Randall died during the term of the policy. See Mortensen v. Mortensen, 760 P.2d 304, 308 (Utah 1988) (“[I]n Utah, trial courts making ‘equitable’ property division pursuant to section 30-3-5 should . . . generally award property acquired by one spouse by gift and inheritance during the marriage (or property acquired in exchange thereof) to that spouse, together with any appreciation or enhancement of its value, unless . . . the property has been consumed . . . .” (emphasis added)); see also In re Marriage of Rolfe, 699 P.2d 79, 84 (Mont. 1985) (noting that the district court “erred in returning the value of” certain prenuptial property that had “long since been consumed” during the course of a fifteen-year marriage); In re Marriage of Fluent, 2017 WL 2461601, at *3 (determining that it was “inequitable” to require a wife to reimburse her former husband $74,000 of his own funds that he had voluntarily used during the marriage “to maintain the parties’ basic standard of living” and “for the benefit of both himself and his family, without providing any accounting for these expenditures or identifying any asset (beyond the marital home) into which the monies were allegedly spent” (cleaned up)).
¶13 Accordingly, the district court exceeded its discretion in ordering reimbursement where there was no evidence that Randall continued to benefit after the divorce from the previous payments of the premiums.
CONCLUSION
¶14 Because Vicki had already received the benefit of the insurance premiums she paid, we conclude that the district court exceeded its discretion in ordering Randall to reimburse Vicki $40,000 for the premiums.
[1] Our practice is to refer to parties by their first names when they share a last name.
[2] “On appeal from a bench trial, we view the evidence in a light most favorable to the trial court’s findings, and therefore recite the facts consistent with that standard.” Chesley v. Chesley, 2017 UT App 127, ¶ 2 n.2, 402 P.3d 65 (cleaned up).
[3] Insofar as Vicki attempts to cast the absence of the insurance policy as a failure of Randall to disclose it, we note that Vicki had the burden of producing evidence of the provisions of the policy in question. After Randall offered testimony of the policy’s cash value—testimony we note that Vicki appeared to agree with at trial when she characterized the policy as having no “value” apart from its value contingent on Randall’s death, see infra ¶ 9—Vicki had the burden of offering evidence of an alternative valuation. See Argyle v. Argyle, 688 P.2d 468, 470–71 (Utah 1984) (stating that if a party asserts that an asset should be valued by a different measure, then “the burden of offering further evidence on alternative methods of valuation” falls on that party); accord Beesley v. Beesley, 2003 UT App 202U, para. 2.
[e]ach premium payment gives rise to an enforceable contractual right of coverage for an additional period of time. As premiums are paid over the life of the policy, distinct property interests in coverage for various periods of time arise. Of those distinct property interests, only one is worth anything in hindsight: coverage for the term during which the insured dies.
In re Marriage of Burwell, 164 Cal. Rptr. 3d 702, 713 (Cal. Ct. App. 2013). “Prior terms of coverage only lack value in hindsight (i.e., when it is certain the contingency has failed). Prospectively, all coverage terms have at least expected value.” Id. at 713 n.12. Thus, here the policy had no value in the sense that the premium coverage periods had expired without the contingency occurring, and these are the very terms for which Vicki received reimbursement.
[5] It is unclear how the district court found that Randall benefited from the payment of premiums by allowing him to “perpetuate” the policy for “his newly named beneficiaries.” At best, this benefit identified by the court seems speculative because the court had explicitly stated that it did not have access to the policies and that it was “unclear whether these term life insurance policies were renewable by year, or after a number of years, or ended upon Randall’s death, or were terminated in the event of a divorce.”
[6] The court ordered Randall to pay Vicki a cash payment of $68,750 plus any gains realized from non-retirement accounts and IRAs. This amount consisted of equalizing payments of $23,658.50 for non-retirement assets, $2,913 for IRAs, $1,000 for gains on a non-retirement account, $1,250 for a half-interest in a burial plot, and $40,000 for the life insurance premium reimbursement. We note the sum of these values is $68,821.50, which is $71.50 more than the court’s addition yielded. On remand, the court should resolve this discrepancy.
DUANE CROFT KNOWLES, Appellant, v. CELIA FERN KNOWLES, Appellee.
Opinion
No. 20200032
Filed April 7, 2022
Second District Court, Farmington Department
The Honorable David R. Hamilton
No. 174700123
Julie J. Nelson and Alexandra Mareschal, Attorneys for Appellant
Emily Adams and Sara Pfrommer, Attorneys for Appellee
JUDGE MICHELE M. CHRISTIANSEN FORSTER authored this Opinion, in which JUDGES RYAN M. HARRIS and DIANA HAGEN concurred.
CHRISTIANSEN FORSTER, Judge:
¶1In 2016, Duane Croft Knowles and Celia Fern Knowles separated after nearly thirty years of marriage. During their separation, the district court awarded Celia1 temporary alimony and, after a bench trial, entered a final alimony award. Duane now appeals those awards, arguing the court abused its discretion in (1) declining to award him credit for purported overages he paid in temporary alimony, (2) calculating the parties’ expenses in determining the final alimony award, and (3) selecting the date to value the retirement accounts. We affirm in part and reverse in part and remand.
BACKGROUND2
¶2Duane and Celia were married in December 1989. They remained married for twenty-nine years, during which time they had six children. For the duration of the marriage, Duane worked as an optometrist and supported the family financially.
¶3In 2016, Duane and Celia separated. At that time, only two of the children were minors.3 Upon the parties’ separation, Celia remained in the marital home, which was paid off. Each month Duane used his income to pay the family’s bills and any remaining funds were then divided between the parties; in the initial months following their separation, Celia received $200 more per month than Duane, after which the excess was split 50/50. After several months of this informal arrangement, both parties filed motions for temporary orders, supported by financial declarations.
¶4In Celia’s financial declaration, she reported a nominal monthly income of $103.52 from her massage therapist side business but requested the court impute the minimum wage for full-time employment to her in the amount of $1,257 per month. Celia also declared that her monthly financial needs were $8,476.91. This total included, among other things, orthodontic expenses for one of the parties’ minor children and a monthly donation for tithing to Celia’s church.
¶5In Duane’s financial declaration, he reported a net monthly income of $9,671.08 from his job as an optometrist. Duane calculated his monthly expenses as $5,054.70 and included in those expenses a line-item for a tithing donation to his church.
¶6 The competing motions for temporary orders were reviewed before a commissioner in September 2017. Duane was ordered to pay Celia $3,797 in alimony each month, beginning in July 2017. The commissioner noted that “the issue of retroactive alimony prior to July 1, 2017,” would be “reserve[d]” and that Duane “shall receive credit for amounts he has paid [Celia] or on behalf of [Celia] during this time.” In calculating temporary alimony, the commissioner adjusted the stated monthly expenses for both parties, including eliminating the claimed monthly expense for tithing. The commissioner did not exclude, however, Celia’s claimed orthodontic expenses for the parties’ minor children.
¶7 Duane objected to the commissioner’s alimony recommendations, arguing that the commissioner had improperly calculated the parties’ needs by failing to “equalize the parties[’] standards of living” and “by failing to consider the parties[’] historical standard of living.” In addition, he argued that the temporary award should cover only the actual expenses of the parties and not “projected expenses” such as possible orthodontics for the parties’ ten-year-old child who did not yet have braces.
¶8Following briefing and argument on Duane’s motion, the district court sustained the commissioner’s recommendations as to the parties’ temporary expenses and incomes. In particular, the court noted that including the orthodontic expenses in calculating Celia’s needs “was not erroneous” because “[e]ven if orthodonti[cs] is not presently involved, it could occur in the immediate future.” However, the court agreed with Duane that some of Celia’s expenses were inflated and that alimony should be adjusted accordingly. The court then reduced the temporary alimony award from $3,797 to $2,809, with payments set to begin on July 1, 2017, the same day set by the commissioner in his initial order.4
¶9In 2019, two years after Duane filed for divorce, the parties went to trial. During the course of the two-day bench trial on financial issues, both parties testified, along with their respective experts.
¶10 Duane first challenged the district court’s award of temporary alimony, arguing that Celia’s financial declarations were not adequately supported and that she had failed to prove the marital standard of living and her actual needs. In support of this argument, Duane called as an expert a forensic accountant to testify regarding the parties’ marital standard of living. The expert first testified that prior to the parties’ separation in 2016, the monthly marital expenses for both parties together were $9,338, or $4,669 each. He then explained that Celia had requested $8,476.91 in her financial declaration but had been spending only around $4,755.02 per month. He also opined that, based on the parties’ historical spending, tithing donations to their church were part of the marital standard of living.
¶11In addition to challenging the amount of alimony, Duane asked the court to credit him $64,000 for what he characterized as an “overage” he paid in temporary alimony. In essence, Duane argued that the temporary alimony figure he had paid for approximately two years had been too high and asked the court to adjust that figure retroactively and award him the difference between what he had paid and what he should have paid. He argued that Celia had “intentionally dissipated the marital estate by overspending,” “over-inflat[ing] her needs,” and “refusing to work” despite having “the ability to work full time.”
¶12 Following trial, the district court entered its findings of fact and conclusions of law. Based on its analysis of the parties’ income and needs, the court awarded Celia $2,770 in permanent alimony per month moving forward.
¶13 In reaching that amount, the court first analyzed each party’s income. It calculated Duane’s monthly net income at $9,368, after averaging the prior four years of his annual income as stated in his tax returns. The court also imputed a monthly net income of $1,874 to Celia, finding that “she is voluntarily underemployed” and “capable of employment.”
¶14 The court then analyzed the needs of each party. It first declined to “award any donations or tithing for either party.” It reasoned that the tithing payments were “a religious preference” and “not a necessary living expense.”
¶15 Next, after examining Celia’s multiple financial declarations and other relevant evidence, the district court found that her post-divorce living expenses would be $5,382 per month. To reach this amount, the court excluded some of Celia’s claims for expenses, finding the supporting evidence “lacking, remote in time[,] and remote in detail.” But the court also added additional expenses for a future mortgage and for health insurance, which had not been included in Celia’s financial declarations.
¶16Finally, the court examined Duane’s financial declarations and supporting evidence and determined that his monthly post-divorce living expenses, excluding child support, would be $5,833. In so doing, the court excluded only “the expense of donations,” finding Duane’s other expenses “to be appropriate.”
¶17 After setting the amount of permanent alimony, the district court addressed both parties’ claims regarding alimony arrears and overpayments. Without addressing the merits of the parties’ arguments, the court summarily concluded that both parties had failed “to provide or to carry the weight of the evidence in their respective favor” and declined to credit Duane for any overpayments of temporary alimony.
¶18With respect to the parties’ retirement accounts, the court awarded each party “one-half of the value of the marital portion of the retirement accounts, . . . with a valuation date of August 2, 2019,” the date on which the court announced its oral ruling.
¶19 Following the district court’s oral ruling, Duane filed a document requesting further clarification on a number of issues, including, as relevant here, his taxpayer filing status and the valuation date of the retirement accounts. As to his taxpayer filing status, Duane noted that his “ability to pay should be reduced by $224/month as his taxable income will be higher” because of the change in his filing status following the divorce. As to the valuation date of the retirement accounts, Duane noted that the division date “should be the date of separation” and not the date of divorce.
¶20 In response to Duane’s request, the district court issued an order rejecting both arguments. First, it declined to change Duane’s taxpayer filing status, reasoning that Duane had not provided sufficient evidence to rebut its previous ruling. Second, it declined to change the valuation date of the retirement accounts. It acknowledged that “typically the date of division of retirement accounts is the date of divorce” but, due to the “totality of the circumstances” presented in this case, determined to use August 2, 2019 as the “date of division,” noting that the parties had not made “sufficient argument about a different division date being used.”
ISSUES AND STANDARDS OF REVIEW
¶21 Duane now appeals and raises three issues for our consideration. First, he contends that the district court erred “by failing to correct for overage paid in temporary alimony.” “District courts have considerable discretion in determining alimony and determinations of alimony will be upheld on appeal unless a clear and prejudicial abuse of discretion is demonstrated.” Burggraaf v. Burggraaf, 2019 UT App 195, ¶ 26, 455 P.3d 1071 (quotation simplified).
¶22 Second, Duane contends that the district court erred in calculating the amount of the permanent alimony award. Specifically, he argues that the court miscalculated the parties’ expenses by failing to include the tithing contribution each paid to their church, by “including an ongoing expense for orthodonti[cs],” and by “miscalculating [Duane’s] tax obligation.” We review a district court’s alimony determination for an abuse of discretion. See id. In determining alimony, a court exceeds its discretion if its alimony award “lacks a reasonable basis.” Redden v. Redden, 2020 UT App 22, ¶ 15, 461 P.3d 314.
¶23 Third, Duane contends that the district court erred by “setting an arbitrary valuation date for the retirement accounts rather than the date of separation.” “The [district] court in a divorce action is permitted considerable discretion in adjusting the financial and property interests of the parties, and its actions are entitled to a presumption of validity.” Rayner v. Rayner, 2013 UT App 269, ¶ 4, 316 P.3d 455 (quotation simplified). “Thus, we will not disturb a court’s distribution of marital property unless it is clearly unjust or a clear abuse of discretion.” Goggin v. Goggin, 2013 UT 16, ¶ 44, 299 P.3d 1079 (quotation simplified).
ANALYSIS
I. Overpayment of Temporary Alimony
¶24 Duane first contends that the district court abused its discretion by failing to credit him for what he considers to have been excess payments made to Celia pursuant to the court’s temporary alimony order. Duane argued below, and argues now on appeal, that the temporary alimony award was erroneous because Celia obtained it by submitting inflated and unjustified need claims that the district court rejected after hearing the evidence at trial. Specifically, he argues that the temporary award underestimated the amount of income to be imputed to Celia, relied on an inflated estimate of Celia’s needs, and included a triple award for the children’s medical expenses.
¶25 Celia first responds that Duane failed to preserve this issue below, with the exception of his claim regarding the triple award of medical expenses. She then asserts that Duane’s argument fails on the merits because his comparison of the temporary and final awards fails to account for changes in her circumstances during the two-year period between separation and trial. We turn first to the preservation argument and then address the merits.
A. Preservation
¶26 Celia asserts that Duane’s overpayment argument regarding her expenses and income is unpreserved because the argument Duane raised in the district court is based on an “entirely distinct legal theory” from the argument he raises on appeal. (Quotation simplified.) In the district court, Duane argued that he paid too much in temporary alimony because Celia had “dissipated the marital estate by overspending” and had refused to work. Celia asserts these arguments are distinct from the argument Duane raises here, which is that the temporary alimony award was overinflated because of adjustments to Celia’s alimony award made by the district court at the time of trial. We disagree with Celia’s characterization of the arguments and conclude that the issue was properly preserved.
¶27“Our preservation requirement is well-settled: we require parties to have raised and argued before the district court the issue that they raise and argue before us on appeal, and if a party does not, it has failed to preserve the issue.” True v. Utah Dep’t of Transportation, 2018 UT App 86, ¶ 23, 427 P.3d 338 (quotation simplified). “An issue is preserved for appeal when it has been presented to the district court in such a way that the court has an opportunity to rule on it.” State v. Rogers, 2020 UT App 78, ¶ 20, 467 P.3d 880 (quotation simplified). A party asserting error on appeal must have raised the issue before the district court “specifically, in a timely manner, and with support by evidence and relevant legal authority.” True, 2018 UT App 86, ¶ 24. “New arguments, when brought under a properly preserved issue or theory,” may be properly considered on appeal. Id. ¶ 32 (quotation simplified). “Such arguments include citing new authority or cases supporting an issue that was properly preserved.” State v. Johnson, 2017 UT 76, ¶ 14 n.2, 416 P.3d 443.
¶28 The arguments Duane raised repeatedly in the district court are, in fact, based on the same facts and legal theories as those he raises here. In the proceedings on temporary orders, Celia filed a financial declaration stating that her monthly need was $8,476.91, which was only $1,000 short of Duane’s entire net income. At that time, Celia was working a de minimis amount and had no expenses for health insurance or housing since she was residing in the paid-off marital home and receiving health insurance through Duane’s employment. The commissioner reduced some of Celia’s claimed expenses and imputed income to her based on full-time work at a minimum wage income and then recommended that Duane pay temporary alimony in the amount of $3,797 per month.
¶29 Duane objected to the commissioner’s recommendation, arguing that Celia’s requested amount far exceeded the marital standard of living. Duane requested that the district court immediately correct the inflated temporary alimony because he was concerned that the court would decline to correct it retroactively. The court agreed that some of Celia’s expenses were inflated and reduced the temporary award to $2,809. Dissatisfied with the court’s resolution of the issue, Duane filed a petition for interlocutory appeal with this court, again making the argument that the temporary alimony award was excessive because Celia’s claimed expenses were excessive. His petition was denied.
¶30 Having been only partially successful in urging the district court to reduce the temporary award before trial, Duane again challenged the temporary award at trial. Indeed, Duane maintains that much of his motivation to take the case to trial— rather than to settle out of court—was to have the temporary alimony award corrected. Duane filed a trial brief in which he argued that he should be credited for any overage he had paid in temporary alimony and that temporary alimony should be “reduced retroactively as it was incorrectly applied.” Specifically, Duane argued that Celia had “over-inflated her needs” and “misled the [c]ourt with her financial declaration.” After the district court announced its preliminary oral ruling, Duane argued in post-trial briefing that the court should award him a judgment for “alimony that was over-paid during the temporary orders.” And at oral argument on the post-trial issues, Duane again argued that “[t]he temporary order created a substantial inequity between the parties” and that he should be given a judgment for the amounts he overpaid. The court noted Duane’s argument but declined to analyze the merits of his arguments or credit him for any overpayment.
¶31 In short, Duane repeatedly argued below that the temporary alimony award was wrong for two broad reasons. First, he claimed that it was wrong due to Celia’s allegedly overstated expenses. Second, he claimed that it was wrong due to Celia’s allegedly understated earning capacity. Duane sought credit for these overages based on his argument that the evidence presented at trial failed to support the temporary award. This is the same argument that Duane advances here. The fact that Duane now illustrates the issue by pointing to the discrepancies between the temporary alimony order and the final alimony award (and noting the adjustments made to the final award to account for Celia’s increased expenses for housing and health insurance) does not change the essence of Duane’s argument. We therefore conclude that Duane adequately preserved the issue for our consideration.
B. Temporary Awards
¶32 Utah Code section 30-3-3(3) authorizes an award of temporary alimony “to provide money, during the pendency of the action, for the separate support and maintenance of the other party and of any children in the custody of the other party.” Utah Code Ann. § 30-3-3(3) (LexisNexis Supp. 2021). Although orders providing for temporary support are operative during the pendency of the divorce proceeding, they are not final orders from which an appeal of right may be taken. Rather, as interlocutory orders, they are subject to continuing review and modification by the district court until the issuance of a final judgment. See IHC Health Services, Inc. v. D & K Mgmt., Inc., 2008 UT 73, ¶ 27, 196 P.3d 588 (recognizing the broad discretion of district courts to reconsider and modify interlocutory rulings before final judgment).
¶33 Although district courts have discretion in fashioning temporary orders, temporary alimony is subject to the same requirements as a regular alimony award. See Dahl v. Dahl, 2015 UT 79, ¶¶ 85–98, 459 P.3d 276 (describing factors applied to temporary alimony and concluding the district court did not abuse its discretion in denying temporary alimony when wife failed to provide documentation of her needs). As is the case with awards of permanent alimony, temporary alimony awards must “follow[] logically from, and [be] supported by, the evidence.” Bakanowski v. Bakanowski, 2003 UT App 357, ¶ 13, 80 P.3d 153 (quotation simplified).
¶34 Because of their nature, however, temporary awards are often based on limited evidence. Typically recommended by a domestic relations commissioner after a brief proffer hearing based largely on the financial declarations submitted by the parties, see Utah R. Jud. Admin. 6-401(2)(H), such temporary orders may result in awards that are not supported by the more substantial evidence presented at a later trial. For this reason, district courts have the authority to revisit temporary orders and, if warranted, retroactively modify them in the final divorce decree. See Utah Code Ann. § 30-3-3(4); id. § 30-3-5(4); id. § 78B12-112(4) (2018); Miner v. Miner, 2021 UT App 77, ¶ 101, 496 P.3d 242; McPherson v. McPherson, 2011 UT App 382, ¶¶ 12, 17, 23, 265 P.3d 839.
¶35 This court’s opinion in McPherson illustrates this point and is instructive here. There, husband appealed the district court’s denial of his request for a retroactive modification of his temporary alimony obligation. McPherson, 2011 UT App 382, ¶ 10. The court had based its initial temporary award on the recommendation of the domestic relations commissioner who, in turn, had based it on husband’s salary at the time of the initial support hearing. Id. ¶¶ 3, 5. When the court entered the temporary award, it was unaware that husband had since been fired from his job. Id. ¶ 5. Husband thereafter moved to amend the temporary order to recalculate his child support and alimony obligations in accordance with his then-decreased salary. Id. ¶ 7. The court denied the motion, reasoning that husband’s decreased salary was likely the result of his voluntary underemployment. Id. Following a bench trial, however, the court reversed course, finding that husband was not voluntarily underemployed. Id. ¶ 19. It therefore reduced husband’s future support obligations. Id. But it nevertheless denied husband’s request for a retroactive modification of his temporary support obligations, reasoning there was “no basis in law, fact, or equity to retroactively reduce the amounts.” Id. (quotation simplified).
¶36 On appeal, this court reversed and remanded with instructions for the district court to modify the temporary alimony award retroactively. Id. ¶ 24. While recognizing the considerable discretion district courts possess in determining alimony, we emphasized that such awards must be supported by an explanation based on the evidence. Id. ¶ 23. Because the temporary alimony award was based on the erroneous assumption (later rejected by the district court) that husband was voluntarily underemployed, there was no justification for the higher award. Id. ¶ 21. This court held that the district court abused its discretion by failing to retroactively modify husband’s temporary support obligations, reasoning that “[e]ven if the commissioner’s recommendations seemed well founded at the time of the hearings, once the premise of that decision was proved inaccurate, there was no reasoned basis to impose temporary support obligations that were mathematically impossible for [h]usband to pay.” Id. ¶ 23.
¶37Like the husband in McPherson, Duane argues the district court abused its discretion when it failed to credit him for temporary alimony payments that were higher than the amount the court determined was appropriate after hearing the evidence at trial. We therefore consider whether the district court’s refusal to modify the temporary alimony award was supported by its factual findings and rulings at trial.
¶38Duane identifies $62,627 in alleged discrepancies between the district court’s award of permanent alimony based on the trial evidence and its award of temporary alimony based on the proceedings before the commissioner. These consist of discrepancies between (1) Celia’s imputed income ($16,255 in overage); (2) Celia’s needs ($38,250 in overage); and (3) the amount awarded for medical expenses ($8,152 in overage). While Celia argues that these discrepancies are readily explainable, the district court offered no such explanation. Despite Duane’s request for reimbursement of what he argued was excessive temporary alimony, the court summarily declined to reconcile the differences, stating only that “neither party submitted sufficient evidence for arrears or overages.” But the district court’s summary refusal to consider the merits of the issue on the basis of insufficient evidence does not suffice, because the evidence supporting Duane’s request for reimbursement of asserted overages was the very same evidence that supported the court’s award of permanent alimony.5 Indeed, the court’s explanation for its refusal to address the discrepancies between the temporary and final award is no more sufficient than the McPherson court’s conclusory statement that there was “no basis in law, fact, or equity to retroactively reduce the amounts.” See 2011 UT App 382, ¶ 19 (quotation simplified). We therefore turn to the alleged discrepancies Duane identifies.
Celia’s Imputed Income
¶39 An alimony award must account for the ability of the recipient spouse to support themselves. See Utah Code Ann. § 30-3-5(9)(a)(ii) (LexisNexis Supp. 2021). At the temporary stage, the court imputed $1,225 in net income to Celia. But at trial, the court agreed with Duane and found that Celia was “voluntarily underemployed” and “capable of employment.” Based on the testimony presented at trial, the court imputed to Celia $1,874 per month in net income, which represented an increase of $649 per month over the amount imputed in the temporary award. And the court made no finding suggesting that Celia could not have earned that amount during the pendency of the proceedings, or otherwise justifying the discrepancy between the temporary order and its findings at trial. The court should have considered whether Celia had the same earning capacity during the separation.
Celia’s Needs
¶40 An alimony award also must account for the financial condition and needs of the recipient spouse. See id. § 30-3-5(9)(a)(i). At the temporary stage, when Celia was residing in the paid-off marital home and receiving health insurance through Duane’s employment, the court found that Celia had monthly expenses (needs) of $5,370. After imputing a monthly net minimum wage of $1,225 to Celia and giving Duane credit for $1,336 in monthly child support payments, the court entered a temporary alimony award of $2,809 per month.
¶41 At trial, however, the court found that evidentiary support for Celia’s expenses was “lacking, remote in time,” “remote in detail,” and “artificial.” It therefore disallowed many of her claimed expenses. It then added a monthly mortgage expense of $1,015 to account for the fact that Celia would be required to refinance the marital home to cash out Duane’s equity. It also added a monthly health insurance expense of $503 because Celia would no longer be eligible for insurance through Duane’s employer after the divorce. Following these adjustments, the court made a finding that Celia’s monthly post-divorce expenses were $5,382. Excluding the post-divorce adjustments for housing and health insurance, the permanent award based on the trial evidence was $1,530 per month less than the temporary award or a total of $38,250 over the twenty-five months that Duane paid support pursuant to the temporary order. Duane argues that the district court erred in failing to award him this overage.
¶42 Celia argues that this court should reject Duane’s argument because he failed to marshal the evidence supporting the district court’s permanent award. She argues that Duane disregarded the evidence supporting her need for support after “the collapse of her 27-year marriage where she was largely a stay-at-home parent.” But marshalling is not required, because Duane has not raised a sufficiency argument or challenged the district court’s factual findings. And Celia has not explained why the length of the marriage or her status as a stay-at-home parent justifies the discrepancies in the amount of the temporary and final awards, since these issues are properly considered in determining the length of the alimony award and the level of income to impute to the receiving spouse. See id. § 30-3-5(9)(a)(ii), (iv).
¶43 Celia next argues that Duane is committing a logical fallacy of false equivalence by comparing the temporary and final alimony awards because there are significant differences between the two kinds of awards. She posits that a spouse’s needs, ability to produce income, and support of minor children may change from the time a court orders temporary alimony to the time of the final award and suggests that this is the explanation for the discrepancies here. She asserts that she was able to earn more income as time went on because her children were growing and their medical needs had decreased. She therefore suggests the district court determined she could earn more after the divorce was final than during its pendency. A court could conceivably find that a party is able to earn more at the time of trial than at the time of temporary orders. But the court made no such finding here, and we note that at no point during the temporary proceedings did Celia argue that the children’s medical needs prevented her from working. Indeed, the commissioner imputed her minimum wage for full-time work, and the district court found that Celia was voluntarily underemployed and flatly rejected her argument that she could not work because of the children’s medical needs.
¶44Finally, Celia argues that Duane’s line-by-line comparison
of the temporary and permanent awards is misleading because an alimony award is based on a more generalized determination of the amount necessary for both parties to maintain the standard of living that they enjoyed prior to the divorce. Because the temporary award ($2,809) was only $39 higher than the final award ($2,770), Celia maintains that the court’s failure to make an adjustment could not have been an abuse of discretion. But this argument ignores the adjustment made to the temporary award to account for mortgage and health insurance expenses.6 And more importantly, it is at odds with the district court’s express finding that evidentiary support for Celia’s claimed expenses was “lacking, remote in time,” “remote in detail,” and “artificial.” The court should have considered the merits of Duane’s arguments regarding these discrepancies to determine whether a modification of the temporary alimony award was in order.
Medical Expenses
¶45 Duane also argues that the temporary alimony award erroneously included a triple award of medical expenses. The temporary orders awarded Celia approximately $400 per month for medical expenses for the parties’ children, as well as half the funds in the parties’ health savings account (HSA). In addition, the temporary orders required that Duane pay for half the children’s medical costs. Duane reasons that Celia should not have been awarded the $400 per month for medical expenses and half of the HSA account, because he was already required to pay for half of the children’s medical costs. And he argues this inequity was exacerbated at trial when the court awarded Celia an additional lump sum for orthodontic expenses and miscellaneous out-of-pocket medical expenses. Duane seeks a credit in the total amount of $8,152.
¶46 Celia disputes Duane’s claim, arguing that Duane has failed to demonstrate that the money she was awarded for medical expenses exceeded the actual needs of the family. She also points to the district court’s finding that she had established the amount of the medical expenses with receipts and testimony not refuted by Duane, and that the award was to be paid from the HSA, not in addition to it.
¶47Duane responds that Celia is confusing the district court’s award for medical expense arrearages with the ongoing expenses included in calculating Celia’s need. He explains the court included approximately $400 per month in medical expenses in calculating Celia’s expenses, awarded Celia half the HSA account, and then duplicatively ordered Duane to pay for half the children’s medical expenses during the temporary orders period. After trial, Celia was awarded $150 per month in health care expenses and Duane was awarded the entire HSA amount. As was the case with Duane’s claim to recover overages associated with Celia’s allegedly inflated expenses and underemployment, the district court did not engage with Duane’s arguments that the temporary alimony award was $541 too high, stating only that it “had previously ruled that [Celia] is entitled to an award of medical expenses” and that it would “not modify its previous ruling.” There was no legal justification for the court’s refusal to examine the merits of Duane’s claim.
Remand
¶48Temporary support orders are interlocutory in nature and therefore subject to continuing modification by the district court through the date of the final decree. Because they are often based on proffers that may differ from the actual evidence presented at trial, such temporary orders may result in awards that are not supported by the evidence presented at a later trial. For this reason, district courts have not only the authority, but the obligation, to revisit temporary orders when requested and, if warranted, to “true-up” or retroactively modify them to comport with the evidence.
¶49While district courts retain broad discretion in fashioning support orders in divorce proceedings, they are obligated to analyze a timely claim by a party seeking to true-up a temporary support order with the evidence received at trial. This true-up process consists of a two-part exercise. If a true-up is timely requested, the court should first make factual findings relevant to the temporary award to determine whether it was supported by the evidence. If the court finds, after hearing all the evidence presented at trial, that the temporary order was inappropriate, then the court should proceed to the second step: determining whether a true-up is warranted in the case at hand. In many cases, a party who has demonstrated that a temporary order was inappropriate and unsupported by the more comprehensive evidence presented at trial will be entitled to a retroactive modification of that order. See McPherson v. McPherson, 2011 UT App 382, ¶¶ 21–24, 265 P.3d 839. But in some cases, a court may find that such retroactive modification is inappropriate or inequitable, notwithstanding an inaccuracy or error in the temporary order. In making the determination whether to order a true-up, a court should identify the considerations bearing on its decision and should enter careful findings explaining the basis for that determination.
¶50Here, Duane was entitled to have the district court engage on the merits in determining whether he was entitled to a true-up. As we have discussed, Duane repeatedly asked the district court to consider his contention that the temporary alimony award was too high and timely sought an offset based on the evidence presented at trial. At trial, the court concluded that Celia should be imputed more income than was included in calculating the temporary alimony. It also found that Celia’s claimed expenses were lacking in evidentiary support. But it failed to analyze, explain, or reconcile the discrepancies between the numbers used to calculate the temporary and final alimony orders. It similarly failed to engage in or analyze Duane’s claim that both the temporary and final alimony orders had duplicated the award for the children’s medical expenses. This was an abuse of its discretion. We therefore remand the matter to the district court to complete the first step of the true-up process by making appropriate factual findings relevant to the temporary award to determine whether it was supported by the evidence. If the court finds the temporary order was overinflated, it must then determine whether a true-up is warranted. And it should also consider Duane’s claim that both the temporary and final alimony awards included a triple award of the children’s medical expenses.
II. Calculation of the Final Alimony Award
¶51Duane next contends that the district court erred, in three ways, in calculating the final alimony award: (1) it did not consider tithing paid to the parties’ church as consistent with the marital standard of living, (2) it failed to consider Duane’s post-divorce tax bracket, and (3) it included orthodontics as a permanent expense. We address each argument in turn.
A. Tithing
¶52 Duane argues that the district court miscalculated his ability to pay alimony by excluding expenses that it deemed unnecessary. According to Duane, the court analyzed whether the parties’ claimed expenses were “necessary,” rather than whether they were consistent with the “marital standard of living.” (Quotation simplified.) After doing so, it determined that tithing paid to the parties’ church was not a necessary obligation and therefore excluded it from Duane’s list of expenses, thus inaccurately increasing his ability to pay.
¶53 When setting an alimony award, the district court must consider a number of statutory factors, including “the financial condition and needs of the recipient spouse,” “the recipient’s earning capacity or ability to produce income,” and “the ability of the payor spouse to provide support.” Utah Code Ann. § 30-35(9) (LexisNexis Supp. 2021). “Furthermore, the award should advance, as much as possible, the purposes of alimony by assisting the parties in achieving the same standard of living they enjoyed during the marriage, equalizing the parties’ respective standards of living, and preventing either spouse from becoming a public charge.” Hansen v. Hansen, 2014 UT App 96, ¶ 6, 325 P.3d 864 (quotation simplified).
¶54 In adhering to these principles, this court has described the proper process to be followed by courts when awarding alimony:
First, the court must assess the needs of the parties, in light of their marital standard of living. Next, the court must determine whether the receiving spouse is able to meet [their] own needs with [their] own income. If the court finds that the receiving spouse is unable to meet [their] own needs with [their] own income, the court must then assess whether the payor spouse’s income, after meeting [their own] needs, is sufficient to make up some or all of the shortfall between the receiving spouse’s needs and income.
Redden v. Redden, 2020 UT App 22, ¶ 21, 461 P.3d 314 (quotation simplified). If the court determines after conducting this analysis “that there are insufficient resources to meet the baseline needs established by the marital living standard, the court should then equitably allocate the burden of the shortfall between the parties.” Rule v. Rule, 2017 UT App 137, ¶ 22, 402 P.3d 153.
¶55As an initial matter, the court must assess the needs of the parties not by applying its own sense of which expenses are truly necessary but, instead, by examining whether their claimed expenses are consistent with the standard of living the parties established during the marriage. See id. ¶ 15. This assessment is fact-sensitive and individualized and must be limited to a determination of whether the claimed needs are “based on the parties’ historical standard of living.” See Bakanowski v. Bakanowski, 2003 UT App 357, ¶ 12, 80 P.3d 153; see also Anderson v. Anderson, 2018 UT App 19, ¶ 31, 414 P.3d 1069 (defining “standard of living as a minimum of necessities, comforts, or luxuries that is essential to maintaining a person in customary or proper status or circumstances” and “disavow[ing] the notion that standard of living is determined by actual expenses alone” (quotation simplified)). Indeed, it is not the job of the district court to “appl[y] its own sense of what was reasonable under the circumstances.” See Dobson v. Dobson, 2012 UT App 373, ¶ 29, 294 P.3d 591.
¶56 In comporting with this principle, this court has upheld alimony awards that included unique expenses—even expenses some observers might deem frivolous or unnecessary—where such expenses were consistent with the marital standard of living. See, e.g., Miner v. Miner, 2021 UT App 77, ¶¶ 22, 26, 44, 496 P.3d 242 (awarding receiving spouse, among other things, $1,000 per month for “tennis-related expenses,” $625 per month for “entertainment,” and $5,000 per month for horse care and maintenance where each expense was a historical marital expense supported by the evidence). Moreover, courts may infer that “the parties’ current expenses were based on the marital standard of living when the majority of the expenses in the [payor spouse’s] current financial declaration are identical in amount to those identified as marital expenses in the [receiving spouse’s] current financial declaration.” Eberhard v. Eberhard, 2019 UT App 114, ¶ 48, 449 P.3d 202 (quotation simplified); see id. (finding that receiving spouse’s request for $300 per month for donations and gifts was reasonable “[i]n light of the fact that the court allocated the same amount for each party to spend on donations and gifts”). Accordingly, as long as a party’s claimed expenses are consistent with the marital standard of living, are based on sufficient factual findings, and advance, as much as possible, the purposes of alimony, such expenses should be included in the “needs” calculation.
¶57 The district court did not follow this process here, however. In setting the alimony award, the court did not analyze whether the parties’ tithing payments were an expenditure consistent with the marital standard of living. Instead, the court declined to “award any donations or tithing for either party” based on its finding that “tithing is a donation and . . . not a necessary living expense.” We agree with Duane that in so doing, the court eliminated the expense based on a subjective needs judgment that ignored the requirement that it assess the expense based on how the parties chose to spend and allocate their money while married. See Bakanowski, 2003 UT App 357, ¶ 12. And here, the parties presented evidence that their historical standard of living consistently included paying tithing to their church.7 By failing to assess whether the parties’ expenditures were consistent with the marital standard of living, the court abused its discretion. Accordingly, we reverse the court’s determination on this point and remand for the court to reassess the tithing expense following the process detailed above. The court should make a finding as to whether tithing was included in the parties’ marital standard of living and, if it was, should account for that expense in calculating alimony.8 If inclusion of tithing in the calculation results in a shortfall, the shortfall should be equitably allocated between the parties.
B. Tax Status
¶58Duane next argues that the district court miscalculated his ability to pay because it failed to consider his post-divorce tax obligation. When awarding alimony, the district court must consider “the ability of the payor spouse to provide support,” Utah Code Ann. § 30-3-5(9)(a)(iii) (LexisNexis Supp. 2021), which “includes consideration of the payor spouse’s tax obligations,” McPherson v. McPherson, 2011 UT App 382, ¶ 13, 265 P.3d 839.
¶59The court calculated Duane’s ability to pay by averaging “the last four years” of his net income as listed in his historical tax returns. Based on those returns, the court determined that Duane’s tax obligation would be $24,335.77. In making this determination, the court failed to consider that during each of those years the parties’ filing status was married filing jointly, but that after the divorce Duane’s filing status would—at least for a time—be single or head of household, which would increase his tax obligation. Because the court failed to properly consider Duane’s tax obligation, we reverse and remand for it to recalculate Duane’s post-divorce tax obligations.
C. Orthodontics
¶60 Duane next argues that the district court “mistakenly included $112 per month for orthodonti[cs] in the alimony award.” He contends that this award is improper because (1) no evidence supported an orthodontics expense “that will endure for the entire . . . length of the alimony,” (2) he already pre-paid orthodontics as part of temporary alimony, and (3) he was already ordered to pay half the children’s medical expenses. As previously discussed, the temporary alimony award included $167 per month for orthodontic expenses for the parties’ ten-year-old child who was not yet wearing braces. Duane sought an offset for this amount against the final alimony award and further argued that the alimony award for orthodontic expenses was duplicative in light of the court’s separate order that Duane pay half of the children’s medical expenses. But the district court declined to address Duane’s arguments. Because we have remanded these issues for further consideration, we need not resolve at this juncture Duane’s claims regarding the orthodontics expenses. Rather, we direct the district court to reexamine the issue and articulate the factual and legal basis for its decision.9
III. Valuation Date for the Retirement Accounts
¶61 Finally, Duane argues that the district court abused its discretion by assigning a valuation date to the parties’ retirement accounts that was “long after the date of separation, yet not the date of divorce.”
¶62“Generally, the marital estate is valued at the time of the
divorce decree or trial.” Jacobsen v. Jacobsen, 2011 UT App 161, ¶ 39, 257 P.3d 478 (quotation simplified). However, “a court has broad discretion to value the parties’ marital assets at a different time, such as that of separation, if it determines that the circumstances so warrant.” Petrzelka v. Goodwin, 2020 UT App 34, ¶ 47, 461 P.3d 1134. “[A]ny deviation from the general rule must be supported by sufficiently detailed findings of fact that explain the [district] court’s basis for such deviation.” Rappleye v. Rappleye, 855 P.2d 260, 262 (Utah Ct. App. 1993).
¶63 In this case, the parties separated on May 24, 2016. In 2019, the matter proceeded to a multi-day bench trial that took place between January and April. The court delivered its oral ruling on August 2, 2019. In that ruling, the court addressed the division of the parties’ retirement accounts, ordering that they “be divided . . . 50/50 to each party, effective . . . today, . . . August the 2nd.” Approximately four months later, on December 11, 2019, the court reduced its oral ruling to writing.
¶64Duane contends that the valuation date set by the district court is “arbitrary” and not supported by sufficient findings. He maintains that the court should have set the valuation date as the date of separation. We disagree.
¶65 The valuation date was not arbitrary; it was in fact consistent with the general rule that “the marital estate is valued at the time of the divorce decree or trial.” See Jacobsen, 2011 UT App 161, ¶ 39 (quotation simplified). Here, the court set the valuation date as August 2, 2019—the same date on which it delivered its oral ruling at the close of trial. Because the court followed the general rule of setting the valuation date at the time of trial, it was not required to articulate any additional findings of fact explaining its decision. See id.
¶66 Moreover, the district court was not presented with sufficient evidence to justify a departure from the general rule. After the court’s oral ruling, Duane filed a motion to alter or amend arguing, among other things, that the date of separation should be used as the valuation date because Celia did not contribute to the retirement accounts during the period between the separation and the date of the divorce and therefore should not benefit from the increase in its value.
¶67The court considered Duane’s motion and issued an order upholding its choice of valuation date. It explained that “due to the totality of the circumstances a firm date of August 2nd, 2019 is the date of division of the retirement assets. The Court finds that there was not sufficient argument about a different division date being used.” Given the lack of argument as to an alternative valuation date, the court had no option other than to set the date as the date “of the divorce decree or trial.” See id. (quotation simplified). Duane does not persuade us that the district court acted outside the bounds of its discretion in setting the valuation date for the retirement accounts.
CONCLUSION
¶68 The district court abused its discretion by failing to meaningfully address Duane’s argument that based upon the court’s own post-trial findings, he was entitled to an offset for overages paid in temporary alimony, including offsets arising from the amount of Celia’s imputed income and inflated expenses. The district court similarly erred in failing to consider Duane’s arguments regarding the award of medical expenses, including orthodontics. The district court also abused its discretion when calculating Duane’s ability to pay permanent alimony by excluding tithing as part of the marital standard of living and by underestimating Duane’s post-divorce tax obligation. But we affirm the court’s valuation date for the parties’ retirement accounts. We therefore reverse the district court’s alimony award and remand the matter to the court for reconsideration of the alimony award in accordance with this opinion.
JUDGES GREGORY K. ORME and MICHELE M. CHRISTIANSEN
FORSTER concurred. HAGEN, Judge:
¶1 During their thirty-four years of marriage, Dean and Janice Erickson acquired substantial assets, including a veterinary pharmaceutical business.[1] But, in anticipation of their divorce, Janice engaged in an intentional scheme to dissipate those assets and devalue the marital estate. Solely because of Janice’s misconduct, the district court appointed a receiver, ordered a valuation of the couple’s business, and sanctioned Janice with the obligation to pay all Dean’s attorney fees and costs.
¶2 Janice now contends that the court erred when it failed to deduct her personal goodwill when calculating the value of the couple’s business, excluded her rebuttal expert on valuation, and imposed sanctions against her that were greater than the injury her misconduct caused Dean. We affirm on the first two issues and remand on the third.
¶3 Dean filed for divorce from Janice in early 2017. The couple’s marital estate consisted of substantial assets, including a veterinary pharmaceutical business, Meds for Vets, LLC (Meds). Meds “is a pharmaceutical compounding business with many employees.” The company “does the majority of its business online through its website” and sells “to customers throughout the country.” At the time of the divorce, Meds employed three pharmacists who held the necessary licenses to conduct the business. Janice was one of those pharmacists and held “the majority of the licenses.” Janice also functioned “as the sole manager and chief executive officer of Meds.”
¶4 Around the time Dean filed for divorce, Janice entered into a series of fake business contracts with a friend for the purpose of dissipating marital assets. Dean moved the court for a temporary restraining order, asking the court to appoint a receiver for Meds. The court denied the temporary restraining order but appointed a receiver for Meds in an effort “to prevent further irreparable injury/harm to the marital estate through waste/dissipation of marital assets.” At the recommendation of the receiver, Janice was allowed to continue her role in the company due to her “familiarity with the industry, regulatory environment and existing relationship[] with the customer base . . . so as to not disrupt [Meds’] operations and employees.”
¶5 In addition to the oversight of Meds, the receiver had authority to conduct an “investigation concerning whether and how the joint marital assets . . . were used or misused and how to effectively separate the parties and their marital estate in all business regards.” In its final report to the court, the receiver concluded that Janice had dissipated known marital assets totaling $2,247,274. Janice accomplished that feat, in part, by unilaterally entering into a fraudulent “business relationship which resulted in a substantial and ongoing dissipation of marital assets.”
¶6 The receiver was also charged with “perform[ing] a valuation of the normalized operation of Meds.” The final report included a business valuation placing Meds’ value at $1,560,000. The valuation report explained the different factors considered, including “whether or not the enterprise has goodwill or other intangible value.” Ultimately, the valuation did not include any amounts associated with goodwill.
¶7 The court scheduled a trial on December 2, 2019, the Monday after the Thanksgiving holiday, to determine the final division of the marital estate. The pretrial disclosure deadline was set for November 4, but Janice moved to extend the deadline. The court granted her motion, extending the deadline to Tuesday, November 26 at 5:00 p.m.
¶8 Just before 5:00 p.m. on November 26, Janice filed a disclosure that identified a valuation expert she intended to call as a rebuttal witness. But she did not serve the disclosure on Dean’s attorney until after the deadline had passed. In addition, she did not provide the expert’s report to Dean’s attorney until the afternoon of Wednesday, November 27—the day before Thanksgiving and less than five days before trial.
¶9 On the first day of trial, Janice asked to call her valuation rebuttal expert as the first witness because it was the only day he was available to testify. Dean objected to the admission of the expert’s testimony because it was untimely disclosed, giving Dean insufficient time to prepare. The court allowed Janice to call the expert out of order and reserved its ruling on Dean’s objection until after the expert testified. During his testimony, the expert opined that the receiver’s valuation had overstated Meds’ value as an ongoing business by improperly considering Janice’s personal goodwill.
¶10 The court ultimately excluded the expert’s testimony based on Janice’s untimely disclosure. See Utah R. Civ. P. 26(d)(4) (“If a party fails to disclose or to supplement timely a disclosure or response to discovery, that party may not use the undisclosed witness, document, or material at any hearing or trial unless the failure is harmless or the party shows good cause for the failure.”) The expert had testified that it had taken him only a few weeks to prepare his report, but that Janice had not hired him until shortly before trial. Accordingly, the court found that Janice “had ample opportunity to seek an independent valuation of the marital businesses at her own expense” and noted that it had “addressed this issue with [Janice] several times.” The court further found that Dean had an “understandable inability to be able to fully address [that information] in the limited time that remained prior to trial.”
¶11 The court alternatively ruled that even if it had not excluded Janice’s valuation rebuttal expert as untimely, his testimony was unpersuasive. The court rejected the expert’s opinion, based on Janice’s own representations, that Meds’ value was dependent on Janice’s personal goodwill. The court noted that Utah case law generally associates personal goodwill with “sole proprietorships essentially run by one person” and that such businesses are not “comparable to the situation here with [Meds].” The court also found that it had “not been provided any evidence from which [it could] draw a conclusion that [Janice’s] presence at [Meds], given the point to which its grown, is essential for that business to continue, given the number of employees and the extent of the operations that it has.”
¶12 After trial, the court entered a supplemental decree regarding the division of marital assets. The court “affirm[ed] and accept[ed] all recommendations, valuations, findings, and conclusions contained” in the receiver’s reports, unless the decree stated otherwise, “and incorporate[d] them by reference” into the decree, including the receiver’s $1,560,000 valuation of Meds.
¶13 Due to Janice’s “intentional efforts to dissipate marital assets,” the court also assigned the cost of the receivership and Dean’s attorney fees to Janice as a sanction for contempt and other misconduct. The court found that Janice’s behavior was sanctionable because she “engaged in substantial dissipation of marital assets” that was, “in some cases, in direct violation of this Court’s orders.” Indeed, “the approximately $2.5 million [she] dissipated . . . was one of the largest, if not the largest, blatant dissipation of marital assets the Court ha[d] ever seen.”
¶14 With respect to Dean’s legal fees, the court found that Janice’s contemptuous conduct forced Dean to incur “extraordinary legal costs in enforcing Court orders and attempting to track down and preserve marital assets” and that a “substantial amount of additional work [was] required to address the dissipation issues in this case” because of Janice. The court found that it was therefore appropriate and equitable to assign all Dean’s attorney fees to Janice because “[t]he lion’s share of [Dean’s] legal costs were incurred in connection with issues surrounding the dissipation of marital assets and the nefarious conduct engaged in by [Janice] in this case.”
¶15 More than three months after trial, Janice filed a motion for new trial pursuant to rule 59 of the Utah Rules of Civil Procedure, arguing that there was irregularity in the trial proceedings, that there was insufficient evidence to support the valuation of Meds, and that the court erred in awarding Dean attorney fees. The court dismissed that motion as untimely without reaching the merits.
ISSUES AND STANDARDS OF REVIEW
¶16 Janice now appeals, raising three issues. First, she contends the district court erred in the value it assigned to Meds because it failed to exclude the value of her personal goodwill. A district court is “entitled to a presumption of validity in its assessment and evaluation of evidence, and we defer to the district court’s findings of fact related to property valuation and distribution unless they are clearly erroneous.” Marroquin v. Marroquin, 2019 UT App 38, ¶ 10, 440 P.3d 757 (cleaned up).
¶17 Second, she contends the court erred in excluding her valuation rebuttal expert as a sanction for untimely disclosure. “We review a district court’s decision [to impose] sanctions under rule 26(d)(4) for an abuse of discretion.” Segota v. Young 180 Co., 2020 UT App 105, ¶ 10, 470 P.3d 479 (cleaned up). We will find abuse of discretion where there exists an erroneous conclusion of law or “where there is no evidentiary basis for the trial court’s ruling.” Arreguin-Leon v. Hadco Constr. LLC, 2018 UT App 225, ¶ 15, 438 P.3d 25 (cleaned up), aff’d 2020 UT 59, 472 P.3d 927.
¶18 Third, she contends that the court erred when it ordered her to pay all Dean’s attorney fees and costs, rather than limiting the award to the amounts caused by her sanctionable conduct. “Both the decision to award attorney fees and the amount of such fees are within the sound discretion of the trial court.” Taft v. Taft, 2016 UT App 135, ¶ 86, 379 P.3d 890 (cleaned up).
ANALYSIS
I. The Valuation of Meds
¶19 In her challenge to the district court’s valuation of Meds, Janice argues that the court failed to consider the value of her personal goodwill.[3] “When valuing a business in marriage dissolution cases, district courts must consider whether goodwill is institutional or personal to one spouse.” See Marroquin v. Marroquin, 2019 UT App 38, ¶ 15, 440 P.3d 757. Goodwill is personal when the business “is dependent for its existence upon the individual who conducts the enterprise and would vanish were the individual to die, retire or quit work.” Stevens v. Stevens, 754 P.2d 952, 956 (Utah Ct. App. 1988). Personal goodwill is based on an individual’s “reputation for competency.” Marroquin, 2019 UT App 38, ¶ 15. And unlike institutional goodwill, personal goodwill is not subject to distribution in the marital estate. Id.
¶20 Janice contends that the district court erred as a matter of law by failing to consider whether the value of the business depended on goodwill that was personal to her and thus not divisible. We disagree. The district court did consider goodwill in valuing the business, but specifically found that there was no personal goodwill associated with Meds. Unless the court clearly erred, we presume this assessment is valid and we defer to its findings. See id. ¶ 10.
¶21 In finding that there was no personal goodwill associated with Meds, the court rejected Janice’s contention that Meds was comparable to a sole proprietorship and that her “personal goodwill, as opposed to entity or enterprise goodwill,” should have been excluded in valuing the company. The court concluded that Meds was unlike “sole proprietorships essentially run by one person”—where the value of the company rests primarily on the work and professional reputation developed by the proprietor—“given the number of [Meds] employees and the extent of its operations.”
¶22 On appeal, Janice claims that the court failed to consider the personal goodwill engendered by her own “management and licensure role” in Meds. Before the receiver’s appointment, Janice “had acted as sole manager and chief executive officer of the company,” but there was no evidence to suggest that placing someone else in that role would diminish the value of the company. Indeed, the court specifically found that it had not been “provided any evidence from which [it could] draw the conclusion that her presence at the business, given the point to which it’s grown, is essential for that business to continue given the number of employees and the extent of operations it has.” Janice has not demonstrated that those findings were clearly erroneous.
¶23 As evidence of her personal goodwill, Janice cites the receiver’s report that some Meds employees “attributed the company’s declining revenue, in part, to [Janice] being distracted by the divorce.” But the decline in Meds’ revenue during this period does not suggest that the company’s value was dependent on Janice being in a management role. To the contrary, the court found that Janice’s continued involvement was detrimental because she “continue[d] to take steps to harm and devalue” Meds, even after the appointment of the receiver. In other words, Meds’ declining revenue during that time was caused not by Janice’s inattention to her management role, but by her deliberate efforts to devalue the company.
¶24 Janice also points to the fact that the company used her licenses to operate in multiple states. The court found, however, that Meds holds the necessary pharmacy licenses among three pharmacists. And there was no evidence that Janice’s licenses could not be obtained by the other pharmacists already on staff or that Meds could not hire a replacement pharmacist with those licenses. Thus, the fact that some licenses were historically held by Janice does not undermine the court’s finding that the value of Meds as an ongoing business did not depend on Janice’s involvement.
¶25 In sum, the record shows that the court considered and rejected Janice’s contention that her personal goodwill was included in the valuation of the business, and Janice has not shown that those findings were clearly erroneous. Therefore, there is no basis on which to disturb the court’s valuation of Meds.
II. Excluding Janice’s Rebuttal Expert
¶26 Next, Janice challenges the court’s ruling excluding her valuation rebuttal expert based on her untimely disclosure. Expert disclosures are governed by rule 26 of the Utah Rules of Civil Procedure. Under that rule, proper disclosure of an expert witness requires the timely disclosure of “(i) the expert’s name and qualifications, . . . (ii) a brief summary of the opinions to which the witness is expected to testify, (iii) the facts, data, and other information specific to the case that will be relied upon by the witness in forming those opinions, and (iv) the compensation to be paid for the witness’s study and testimony.” Utah R. Civ. P. 26(a)(4)(A). “If a party fails to disclose or to supplement timely a disclosure or response to discovery, that party may not use the undisclosed witness, document, or material at any hearing or trial unless the failure is harmless or the party shows good cause for the failure.” Id. R. 26(d)(4). “Thus, Utah law mandates that a trial court exclude an expert witness disclosed after expiration of the established deadline unless the district court, in its discretion, determines that good cause excuses tardiness or that the failure to disclose was harmless.” Solis v. Burningham Enters. Inc., 2015 UT App 11, ¶ 21, 342 P.3d 812 (cleaned up); see alsoArreguin-Leon v. Hadco Constr. LLC, 2018 UT App 225, ¶ 22, 438 P.3d 25 (“[I]f a party fails to disclose or supplement a discovery response, the evidence or testimony may not be used.”), aff’d 2020 UT 59, 472 P.3d 927.
¶27 Janice does not dispute that the disclosure of her valuation expert and his report was untimely. The question is whether Janice established an exception to the otherwise mandatory sanction of exclusion under rule 26(d)(4). We conclude that the district court did not exceed its discretion in rejecting Janice’s claim that her untimely expert disclosure was either harmless or justified.
¶28 First, the record amply supports the court’s conclusion that the untimely expert disclosure was not harmless. The court enlarged Janice’s time to serve her disclosures, extending her deadline from November 4 to November 26 at 5:00 p.m.—a mere six days before trial. On November 26, “shortly before 5:00 p.m.” Janice filed her expert disclosure with the court, but she did not serve that disclosure on Dean’s counsel until after the 5:00 p.m. deadline. Moreover, she did not serve the expert report until the following afternoon, the day before Thanksgiving. The timing left only the holiday weekend for Dean’s counsel to review the expert report and prepare to meet that testimony before the trial began on Monday. On the first day of trial, Janice called her rebuttal expert witness out of order, depriving Dean of any additional time he might have had to prepare during the course of the trial. The purpose of rule 26 is to eliminate unfair surprise and provide the opposing party with a reasonable opportunity to prepare for trial. Drew v. Lee, 2011 UT 15, ¶ 28, 250 P.3d 48. Here, the late disclosure deprived Dean of a reasonable opportunity to prepare to rebut the newly disclosed expert’s testimony. Under these circumstances, the district court acted well within its discretion in concluding that the late disclosure was not harmless.
¶29 Second, the record also supports the court’s determination that Janice had no good reason to delay disclosing her expert and his report. The court found that it gave Janice “months” to “call an expert to dispute the valuation that was done by the court-appointed receiver,” yet she waited until “a couple weeks” before trial to hire her valuation rebuttal expert. Moreover, the court found that Janice’s excuse for not hiring an expert—that she was waiting because she wanted the marital estate to pay for the expert—“carrie[d] no water with [the court]” because the court had made clear, at least since the previous August, that Janice had to pay for her own rebuttal valuation expert. Under these circumstances, the district court did not exceed its discretion in finding that the delay was unjustified.
¶30 We conclude that the district court did not abuse its discretion in finding that Janice’s untimely disclosure was neither excused for good cause nor harmless to Dean. Therefore, the district court correctly applied the automatic sanction dictated by rule 26(d)(4) and excluded the expert’s testimony.
III. Sanction of Attorney Fees and Costs
¶31 On appeal, Janice does not challenge the court’s finding that she engaged in sanctionable conduct and acknowledges that “the bulk of the court’s award of fees and allocation of costs were within the court’s authority.” Instead, she argues that the award was excessive because it included some attorney fees and costs not attributable to her sanctionable conduct. Because we cannot determine whether the attorney fees award exceeded the costs that Dean incurred as a result of Janice’s sanctionable conduct, we remand to the district court for further proceedings.
¶32 “[W]hen a court imposes an award of fees or costs as a sanction, its award must be limited to the amount actually incurred by the other party” as a result of the sanctionable conduct. Goggin v. Goggin, 2013 UT 16, ¶ 36, 299 P.3d 1079. In Goggin, the district court awarded the former wife all her attorney fees and costs after finding that they were “largely due to [her former husband’s] untoward and contemptuous behavior.” See id. ¶ 38 (cleaned up). Our supreme court reasoned that “this language implies that [the former wife] may have been awarded at least some attorney fees and out-of-pocket costs that were not caused by [the former husband’s] contemptuous behavior.” Id. (cleaned up). The supreme court therefore held that the district court had exceeded its discretion by awarding costs and fees in excess of the amount attributed to the sanctionable conduct. Id.
¶33 Here, it is not clear whether the district court limited the award to the fees and costs that Dean incurred as a result of Janice’s sanctionable conduct. In assigning the entire cost of Dean’s attorney fees and expenses to Janice, the court found that Dean had incurred “extraordinary legal costs in enforcing Court orders and attempting to track down and preserve marital assets” and that a “substantial amount of additional work [had been] required to address the dissipation issues in this case.” Yet the court also found that Dean’s legal fees and costs “incurred in connection with issues surrounding the dissipation of marital assets and the nefarious conduct engaged in by [Janice]” merely constituted the “lion’s share” of Dean’s legal fees. Like the district court’s use of the term “largely” in Goggin, the use of the term “lion’s share” here suggests that a portion of Dean’s fees and costs were not the direct result of Janice’s sanctionable conduct. To the extent that the attorney fees award included such additional costs, it exceeded the district court’s discretion.
¶34 Accordingly, we vacate the attorney fee award and remand for further proceedings. On remand, the district court should either make findings to support the determination that all Dean’s legal expenses were caused by Janice’s sanctionable conduct or modify the award to exclude any amounts not caused by that conduct.[4]
CONCLUSION
¶35 Janice has not shown that the court failed to consider goodwill in valuing the business or that it clearly erred in finding that there was no personal goodwill associated with Meds. Nor has she shown that the court exceeded its discretion in determining that her untimely expert disclosure was not harmless or justified. However, to the extent that the attorney fees award exceeded the costs Janice’s sanctionable conduct caused Dean to incur, the court exceeded its discretion in granting that award. Therefore, we remand for further proceedings on that issue consistent with this opinion.[5]
—————————————————————-
[1] As is our practice when parties share the same last name, we refer to each by their first names, intending no disrespect to either party.
[2] “On appeal from a bench trial, we view the evidence in a light most favorable to the trial court’s findings, and therefore recite the facts consistent with that standard, and we present conflicting evidence to the extent necessary to clarify the issues raised on appeal.” Nakkina v. Mahanthi, 2021 UT App 111, n.2, 496 P.3d 1173 (cleaned up).
[3] Janice also argues that there was “[i]rregularity in the proceedings” because the receiver “hire[d] a business valuator who is . . . a partner with the receiver at the [same] firm.” But this issue was not preserved. See Brookside Mobile Home Park, Ltd. v. Peebles, 2002 UT 48, ¶ 14, 48 P.3d 968 (explaining that for an issue to be preserved “(1) the issue must be raised in a timely fashion; (2) the issue must be specifically raised; and (3) a party must introduce supporting evidence or relevant legal authority” (cleaned up)). Janice did not challenge this alleged irregularity below. It appears that Janice may have attempted to raise the issue in a motion pursuant to rule 59 of the Utah Rules of Civil Procedure, see Utah R. Civ. P. 59(a)–(a)(1) (providing that “a new trial may be granted to any party on any issue” because of “irregularity in the proceedings of the court, jury or opposing party, or any order of the court, or abuse of discretion by which a party was prevented from having a fair trial”), but the district court properly refused to consider that motion as untimely, and the issue is therefore unpreserved for appeal, see Tschaggeny v. Milbank Ins. Co., 2007 UT 37, ¶ 30, 163 P.3d 615 (holding that an issue raised in an untimely posttrial motion was not preserved for appellate review where district court “properly refused to address the” untimely motion).
[4] Dean argues that even if the district court awarded attorney fees and costs not attributable to Janice’s contemptuous behavior, that error was harmless because a mathematical error resulted in Janice not paying the intended award. If the district court determines that “a clerical mistake or a mistake arising from oversight or omission” has occurred, the court may correct the mistake on remand. See Utah R. Civ. P. 60(a).
[5] “Although [Dean] requests attorney fees on appeal, because the trial court awarded [him] attorney fees only as a sanction for [Janice’s] conduct during litigation, we deny that request.” Liston v. Liston, 2011 UT App 433, ¶ 27, n.6, 269 P.3d 169.
JUDGE RYAN D. TENNEY authored this Opinion, in which
JUDGES DAVID N. MORTENSEN and DIANA HAGEN concurred.
TENNEY, Judge:
¶1 In this appeal, Tara Hillam challenges the district court’s determination that, as part of ongoing divorce proceedings, it cannot divide certain stock options that Tara’s husband previously placed into an irrevocable trust. Although the court certified this as a final and appealable ruling under rule 54(b) of the Utah Rules of Civil Procedure, we conclude that the certification was flawed. We therefore dismiss this appeal for lack of appellate jurisdiction.
¶2 John and Tara Hillam were married in 2000.[2] During their marriage, John’s employer gave him certain stock options. John later set up an irrevocable trust (the Trust) and named himself as the settlor and as one of the beneficiaries of the Trust. Tara was also named a beneficiary of the Trust, but John conditioned her beneficiary status on her marriage to him. After setting up the Trust, John unilaterally moved the stock options into the Trust.
¶3 A few years later, John filed for divorce. After several months of litigation, John and Tara agreed to a partial stipulation. Based on that stipulation, the district court entered a bifurcated decree of divorce that divided some of John and Tara’s marital property. But the court reserved a few issues for a bench trial— including, notably, the “complex trust issue” of whether the stock options could be divided as part of the divorce.
¶4 Before trial, Tara filed a motion to join the Trust as a party. After she did, Dustin Hancock (the Trustee) moved for summary judgment on John’s second cause of action, seeking “a declaration that the Trust is valid and enforceable” and that the stock options were “not subject to division as part of the divorce.”
¶5 Tara opposed the Trustee’s motion. After briefing and argument, the district court determined that the stock options were marital property but were “not subject to equitable distribution” in the divorce because John had placed them in an irrevocable trust. The court accordingly granted the Trustee’s request for summary judgment, thereby excluding the stock options from division in the divorce.
¶6 The court certified its order on this issue “as final.” In doing so, it explained:
First, the Court finds there are multiple parties, and this Order fully adjudicates the only claim . . . involving [the Trustee and the other Trust beneficiaries]. Second, the Court finds there is no just reason to delay. The core of this action is the dissolution of a marriage, and the Trust Parties were joined only because of their respective interests in the Trust. However, the Trust currently exists for the benefit of [John and Tara’s] children and has no interest in the divorce-related disputes between John and Tara. It would be unnecessary and unfair to force the Trust Parties to wait for the divorce claims to go await a trial that could also be followed by a multitude of post-trial motions.
¶7 Tara appealed the court’s grant of summary judgment, and this is the appeal that is now before us. In her brief, Tara argues that the district court had “authority” to “categoriz[e] the stock options as marital property subject to equitable distribution.” The Trustee responded and argued that the court did not have any such authority.
¶8 While this appeal was pending, the district court held a bench trial on the remaining issues in the divorce. Of note, Tara asked the court during that bench trial to find that John had improperly dissipated marital assets when he transferred the stock options to the Trust. The parties litigated that issue, and the court rejected Tara’s dissipation claim in its findings of fact and conclusions of law. As part of this ruling, the court found that John “ha[d] shown, by a preponderance of the evidence[,] that the funds were not dissipated but were used for a legitimate marital purpose.”
¶9 The court issued these findings and conclusions on December 8, 2021, and the court ordered John’s counsel “to prepare any further orders/decrees as are necessary to effectuate” them. As of the date on which we publish this opinion, those findings and conclusions have not yet been incorporated into John and Tara’s decree of divorce.
¶10 We heard oral argument in this appeal on January 25, 2022. Before argument, we directed the parties to be prepared to discuss whether the district court’s rule 54(b) certification of the summary judgment ruling on the Trust issue was proper, and we then discussed that issue with the parties at oral argument.
ISSUE AND STANDARD OF REVIEW
¶11 The parties have briefed and argued the question of whether the district court could divide the stock options that are within the Trust as part of its division of John and Tara’s marital estate.
¶12 But “we may not act on an appeal, including an appeal of a putative final order under rule 54(b) [of the Utah Rules of Civil Procedure], unless we are satisfied that we have appellate jurisdiction.” Copper Hills Custom Homes, LLC v. Countrywide Bank, FSB, 2018 UT 56, ¶ 1, 428 P.3d 1133. “Whether appellate jurisdiction exists is a question of law.” Butler v. Corporation of the President of the Church of Jesus Christ of Latter-day Saints, 2014 UT 41, ¶ 15, 337 P.3d 280.
ANALYSIS
¶13 “As a general rule, an appellate court does not have jurisdiction to consider an appeal unless the appeal is taken from a final order or judgment that ends the controversy between the litigants.” Copper Hills Custom Homes, LLC v. Countrywide Bank, FSB, 2018 UT 56, ¶ 10, 428 P.3d 1133 (quotation simplified). “The obvious and principal rationale for limiting the right to appeal in this way is to promote judicial economy by preventing piecemeal appeals in the same litigation to this Court.” Id. ¶ 11 (quotation simplified). “Strict adherence to the final judgment rule” is necessary to “maintain[] the proper relationship between this Court and the district courts.” Id. (quotation simplified).
¶14 There are three exceptions to the final judgment rule: (1) when the legislature has provided a “statutory avenue for appealing nonfinal orders,” Powell v. Cannon, 2008 UT 19, ¶ 13, 179 P.3d 799; (2) when the appellate court grants a petition for an interlocutory appeal, see Utah R. App. P. 5(a); and (3) when the district court properly certifies an order as final under rule 54(b) of the Utah Rules of Civil Procedure. As noted, the district court below certified its ruling on the Trust issue as being final, thereby invoking rule 54(b) as the putative basis for our ability to review this decision.
¶15 When rule 54(b) is properly invoked, an appellate court can “weigh in on a matter even though not all of the causes of action for all of the parties have been adjudicated,” Copper Hills, 2018 UT 56, ¶ 15, and even if the ruling in question did not “end the controversy between [all] the litigants,” Anderson v. Wilshire Invs., LLC, 2005 UT 59, ¶ 9, 123 P.3d 393 (quotation simplified).
¶16 But our supreme court has “steadfastly adhered to a narrow approach to 54(b) certifications,” and it has “advised our district courts to do the same.” Copper Hills, 2018 UT 56, ¶ 17 (quotation simplified). Consistent with this, the supreme court has held that “[b]y the terms of [r]ule 54(b)” itself, “a ruling must meet three requirements in order to be appealable.” Pate v. Marathon Steel Co., 692 P.2d 765, 767 (Utah 1984). “The first requirement is that there must be multiple claims for relief or multiple parties to the action.” Copper Hills, 2018 UT 56, ¶ 16 (quotation simplified). The second is that “the judgment appealed from must have been entered on an order that would be appealable but for the fact that other claims or parties remain in the action.” Butler v. Corporation of the President of the Church of Jesus Christ of Latter-day Saints, 2014 UT 41, ¶ 25, 337 P.3d 280 (quotation simplified). And the third is that the district court, “in its discretion, must make a determination that there is no just reason for delay of the appeal.” Id. (quotation simplified).
¶17 With respect to this third requirement, it is not enough for a district court to simply state that “there is no just reason for delay.” In Copper Hills, the supreme court linked that requirement to rule 52(a) of our rules of civil procedure, which in turn “requires district courts to enter findings supporting the conclusion that the certified orders are final.” 2018 UT 56, ¶ 21 (quotation simplified). The supreme court held that these findings must “detail the lack of factual overlap between the certified and remaining claims,” and they “should also advance a rationale as to why” there “is no just reason for delay.” Id. (quotation simplified).
¶18 The supreme court did “agree that in multiple party cases”—as opposed to multiple claims cases—rule “54(b) certification may still be appropriate even if there is complete overlap between the certified claims and the remaining claims.” Id. ¶ 28 n.14. But even in “multiple party cases,” the supreme court “still require[d] our district courts to explain whether in any given matter there is factual overlap between the certified claims and the remaining claims,” as well as “why, despite any overlap, 54(b) certification is appropriate.” Id.
¶19 Under this framework, we conclude that the rule 54(b) certification in this case was insufficient because the district court’s certification did not satisfy this third requirement.
¶20 Although the district court did make an express determination that there was no just reason for delay, the court did not include any findings about the “factual overlap between the certified and remaining claims.” Id. ¶ 21 (quotation simplified). And although this case is properly viewed as a multiple party case—which meant that certification could occur even if there was factual overlap—the district court was still required to explain whether there was any factual overlap between the certified claims and the remaining claims, and it was also required to advance a rationale for certification despite any overlap that it had identified. See id. ¶ 28 n.14. The court didn’t do either, so its certification here was infirm.
¶21 Indeed, the circumstances of this case illustrate why such findings are required. Copper Hills instructs district courts to provide a “clear articulation” of their “reasons for granting certification” so that the appellate courts can have a “basis for conducting a meaningful review” of that certification. Id. ¶ 22 (quotation simplified). And when we conduct such a review, we seek to avoid the promotion of “piecemeal appeals,” Anderson, 2005 UT 59, ¶ 9 (quotation simplified), that would “needlessly increase the risk of inconsistent or erroneous decisions” on factually intertwined issues, Copper Hills, 2018 UT 56, ¶ 11.
¶22 As noted, Tara challenges the district court’s ruling on the Trust issue. In her brief, Tara asks us to adopt a test under which a court may equitably divide marital property contained in an irrevocable trust “if the evidence shows that the spouse created the irrevocable trust in contemplation of divorce or with the aim of frustrating the equitable distribution of property in the event of a divorce.” (Emphases added, quotation simplified.) Thus, her proposed test largely turns on the transferring spouse’s intent.
¶23 But in the bench trial that occurred while this appeal was pending, Tara made a dissipation of marital assets claim. That claim likewise turned on John’s intent when he transferred the stock options into the trust. As noted, the parties litigated that issue fully, and the district court has now entered findings on that question.
¶24 Thus, there is significant factual overlap between the certified ruling that led to this appeal and other issues that remained behind and have just recently been litigated. While we are skeptical that a rule 54(b) certification would be appropriate in such circumstances, we have no basis for conducting the necessary review because, as discussed, the district court did not provide an explanation of either the degree of overlap or why it believed that Tara’s appeal of the ruling in question should proceed anyway.
¶25 Like the supreme court, we are cognizant of the fact that a jurisdiction-based dismissal like this one may “leave the parties feeling that form has triumphed over substance.” Copper Hills, 2018 UT 56, ¶ 2. “But we cannot fabricate the power to hear a case.” Id. (quotation simplified). Moreover, we note that the Trust’s counsel agreed at oral argument that, if we dismiss for lack of appellate jurisdiction, Tara could still challenge the court’s ruling about the stock options in an appeal from the final judgment in the divorce case. We think this concession was well taken. And since the district court has not yet entered that final judgment, Tara will still have that right when a final judgment has actually been entered.
¶26 As for this appeal, however, we hold that the district court’s rule 54(b) certification was incomplete because it contained no findings about the factual overlap between the certified and remaining claims, nor did it contain an explanation of why this appeal should proceed despite any overlap.
CONCLUSION
¶27 For the foregoing reasons, we conclude that the district court’s rule 54(b) certification was improper. Because of this, we dismiss this appeal for lack of appellate jurisdiction.[3]
——————————————————————
[1] Because we dismiss this appeal on jurisdictional grounds, “[t]he underlying facts of this case are not [particularly] relevant on appeal,” so “we summarize them only for context.” Miller v. San Juan County, 2008 UT App 186, ¶ 2, 186 P.3d 965. We also note that, pursuant to rule 11 of the Utah Rules of Appellate Procedure, the record has been supplemented with the district court’s findings of fact and conclusions of law from a bench trial that was held in October 2021, and we accordingly consider those findings and conclusions in this appeal.
[2] As is our custom, we refer to John and Tara by their first names because they share the same last name. We intend no disrespect by the apparent informality.
[3] “[W]e have discretion under Utah Rule of Appellate Procedure 5(a) to treat certain improper rule 54(b) certifications as interlocutory appeals.” First Nat’l Bank of Layton v. Palmer, 2018 UT 43, ¶ 14 n.4, 427 P.3d 1169. But the supreme court has cautioned us to use this discretion “judiciously and sparingly.” Copper Hills Custom Homes, LLC v. Countrywide Bank, FSB, 2018 UT 56, ¶ 29 n.15, 428 P.3d 1133. We decline to exercise this discretion here. As noted, the issue that Tara seeks to litigate on appeal is factually intertwined with an issue that she separately litigated below in the October 2021 bench trial. Because she will be entitled to raise this issue in an appeal from the final judgment in the divorce case, allowing this appeal to be heard now would not enhance “judicial economy.” Kennedy v. New Era Indus., Inc., 600 P.2d 534, 535 (Utah 1979).