Jacobsen v. Jacobsen

• Decision Date: 19 May 2011
• Docket Number: No. 20080802–CA.,20080802–CA.
• Citation: 2011 UT App 161,682 Utah Adv. Rep. 22,257 P.3d 478
• Parties: Veronica Lee JACOBSEN, Petitioner and Appellant,v.Guenther JACOBSEN, Respondent and Appellee.
• Court: Utah Court of Appeals

257 P.3d 478

682 Utah Adv. Rep. 22

2011 UT App 161

Veronica Lee JACOBSEN, Petitioner and Appellant,

v.Guenther JACOBSEN, Respondent and Appellee.

No. 20080802–CA.

Court of Appeals of Utah.

May 19, 2011.

David S. Pace, Salt Lake City, for Appellant.Terry R. Spencer and Jeff D. Rifleman, Sandy, for Appellee.Before Judges THORNE, VOROS, and CHRISTIANSEN.

OPINION

CHRISTIANSEN, Judge:

¶ 1 Petitioner Veronica Lee Jacobsen (Wife) appeals several aspects of the trial court's order and decree of divorce. Wife argues, among other things, that the trial court erred in determining that the parties' postmarital agreement was valid and enforceable. We affirm.

BACKGROUND

I. The Divorce Agreement

¶ 2 Wife and Respondent Guenther Jacobsen (Husband) married in April 1997 and began contemplating a divorce in February 2001. At that time, Wife started, but did not complete, online divorce forms. Subsequently, Wife drafted a “Divorce Agreement” (the Agreement), and after negotiating Husband's proposed changes, the parties executed the Agreement in May 2001.

¶ 3 With regard to the parties' residence, the Agreement provided that the following would occur upon filing the divorce petition: (1) Wife's name would be removed from the mortgage but would remain on the title; (2) Husband would be responsible for making payments on the mortgage through the end of August 2004 and, after August 2004, the parties would share these payments “in the ratio of actual gross income”; (3) Wife would be responsible for making the utility and maintenance payments; (4) the parties would equally share the cost of any repairs, except that each would be responsible for damages he or she caused; (5) the parties would list the property for sale in May 2004, at the earliest, and the closing would not take place until after August 31, 2004; (6) “[i]n the case of sale of the property,” the equity would be equally divided between the parties, or “[i]n the case of pay-out on September 1, 2004 [, e]quity [would] be calculated based on property sale listing price (minus closing cost[s] ) at that time or $70K, whichever the greater amount[, would] be paid out to [Wife] by [Husband]”; (7) Wife and her son ¹ could continue living in the residence until the end of August 2004; and (8) after August 2004, Wife could live there “until the property sale [was] finalized or the pay out [was] completed.”

¶ 4 In addition, the Agreement provided that the parties would jointly file tax returns and “divid[e any refund] equally.” The parties also agreed to equally divide the 401(k) and any pension plans held in either party's name “for the duration of the marriage.” Finally, Wife agreed that she would not seek alimony. The trial court expressly noted that the Agreement was “a partial stipulation regarding the disposition of most, but not all, of the parties' assets.” In particular, “[t]he Agreement was silent as to disposition of personalty, including stock options accruing during the parties' marriage.”

¶ 5 After the Agreement was executed in 2001, Husband made the mortgage payments, and paid the taxes and insurance on the residence, without contribution from Wife. Husband paid the mortgage in full in June 2005 with his bonuses, incentive pay, and an inheritance. Although Husband removed Wife's name from the mortgage, it remained on the title to the residence until the residence was sold in August 2006.

II. Bank Accounts

¶ 6 In May 2001, the parties began spending extended time in separate households. The parties also separated their joint bank accounts in May 2001, splitting the funds equally between them. Wife set up new bank accounts solely in her name and named Husband as a signatory on a Utah bank account. Husband retained the joint bank account as his own even though he did not remove Wife's name from the account. With only two exceptions, the parties deposited their respective paychecks into their separate bank accounts and withdrew from them exclusively.² Husband deposited all of his salary into his bank account. He also deposited his inheritance, worth approximately $45,000, into that bank account.

¶ 7 In January 2003, Wife moved to Hong Kong for approximately two and one-half years. While there, she deposited her salary and living allowance into her separate bank accounts, to which Husband did not have access. Husband still had access to one of Wife's bank accounts, which he accessed only to make payments on Wife's credit card account and to pay Wife's son's expenses while she was in Hong Kong.

III. The Residence

¶ 8 Wife lived in the residence with her son before she left for Hong Kong and moved back into the residence upon her return. Husband lived in the residence with Wife's son while Wife was in Hong Kong. The parties sold the residence in August 2006 and placed the proceeds in escrow, where they remained until February 2009 when the trial court granted Husband's motion to enforce the decree of divorce (the Decree) and denied Wife's motion to stay its enforcement.

IV. Divorce Proceedings

¶ 9 Wife filed a divorce petition on October 13, 2005. A bench trial was held on January 31, 2007, and the trial court orally announced its findings of fact and conclusions of law on February 5, 2007, directing Husband's counsel to prepare the written findings of fact and conclusions of law. After significant delays on the part of both parties, the trial court prepared the findings of fact and conclusions of law itself and entered them on June 19, 2008. The Decree was entered on August 26, 2008. Wife filed several post–Decree motions, all of which the trial court denied, and filed a timely notice of appeal.

ISSUES AND STANDARDS OF REVIEW

¶ 10 Wife first argues that the trial court erred in concluding that the Agreement was valid and binding. She contends that there was no meeting of the minds and that a condition precedent failed.

Whether the parties had a meeting of the minds sufficient to create “a binding contract is ... an issue of fact,” which “[w]e review ... for clear error, reversing only where the finding is against the clear weight of the evidence, or if we otherwise reach a firm conviction that a mistake has been made.”

LD III, LLC v. BBRD, LC, 2009 UT App 301, ¶ 13, 221 P.3d 867 (alteration and omissions in original) (quoting O'Hara v. Hall, 628 P.2d 1289, 1291 (Utah 1981)).

¶ 11 Even though Wife purports to challenge only the trial court's legal conclusion that there was “a meeting of the minds sufficient to create a binding [Agreement],” see id. (internal quotation marks omitted), such a determination is factually sensitive, see Chen v. Stewart, 2004 UT 82, ¶ 20, 100 P.3d 1177 (“Even where the defendants purport to challenge only the legal ruling, ... if a determination of the correctness of a court's application of a legal standard is extremely fact-sensitive, the defendants also have a duty to marshal the evidence.”); In re Beesley, 883 P.2d 1343, 1347–48 (Utah 1994) (“The legal standard in the present case—the ‘materiality’ of [the husband's failure] to disclose his financial status prior to executing a premarital agreement—is extremely fact sensitive, and reviewing courts should therefore give trial courts considerable discretion in determining whether the facts of a particular case come within this established rule of law.”). Thus, Wife must marshal the evidence supporting the trial court's conclusion that the parties had a meeting of the minds. See Utah R.App. P. 24(a)(9) (“A party challenging a fact finding must first marshal all record evidence that supports the challenged finding.” ); Chen, 2004 UT 82, ¶ 20, 100 P.3d 1177; Beesley, 883 P.2d at 1347–48.

¶ 12 On the other hand, we review the issue of whether a condition precedent failed as we would any issue of contract interpretation not requiring our resort to extrinsic evidence, i.e., as “matters of law, and on such questions we accord the trial court's interpretation no presumption of correctness.” Foster v. Montgomery, 2003 UT App 405, ¶ 11, 82 P.3d 191 (internal quotation marks omitted), cert. denied, 90 P.3d 1041 (Utah 2004).

¶ 13 Next, Wife asserts that if we conclude that the Agreement is enforceable, we should determine that the trial court erred in its subsequent distribution of the proceeds from the sale of the residence, including crediting Husband for using separate funds to retire the mortgage. “The governing principle in our law is that contracts between spouses are enforceable and ‘generally subject to ordinary contract principles' so long as they are negotiated ‘in good faith ... and do not unreasonably constrain the [divorce] court's equitable and statutory duties.’ ” Ashby v. Ashby, 2010 UT 7, ¶ 21, 227 P.3d 246 (alteration and omission in original) (citations omitted). Accordingly, “[w]e review a trial court's interpretation of an unambiguous contract for correctness.” Levin v. Carlton, 2009 UT App 170, ¶ 9, 213 P.3d 884.

¶ 14 However, the trial court may exercise its considerable discretion in deciding an issue related to the distribution of property that the parties did not consider in the Agreement. See Utah Code Ann. § 30–3–5(1) (2007) (allowing the trial court to equitably distribute the divorcing parties' property); Elman v. Elman, 2002 UT App 83, ¶ 17, 45 P.3d 176 (“ ‘A trial court has considerable discretion concerning property [division] in a divorce proceeding, thus its actions enjoy a presumption of validity.’ ” (alteration in original) (citation omitted)). “We disturb a trial court's property division and valuation ‘only when there is 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.’ ” Elman, 2002 UT App 83, ¶ 17, 45 P.3d 176 (citation omitted). To the extent that Wife argues that Husband's inheritance is marital property, “we review the trial court's legal conclusions concerning...