Brucklier v. Brucklier

• Decision Date: 25 August 2022
• Docket Number: 1 CA-CV 21-0106 FC
• Citation: 77 Arizona Cases Digest 31,516 P.3d 526
• Parties: In re the Matter of: Jennifer Renee BRUCKLIER, Petitioner/Appellee, v. Michael J. BRUCKLIER, Respondent/Appellant.
• Court: Arizona Court of Appeals

77 Arizona Cases Digest 31
516 P.3d 526

In re the Matter of: Jennifer Renee BRUCKLIER, Petitioner/Appellee,
v.
Michael J. BRUCKLIER, Respondent/Appellant.

No. 1 CA-CV 21-0106 FC

Court of Appeals of Arizona, Division 1.

FILED August 25, 2022

Hallier Lawrence PLC, Phoenix, By Angela K. Hallier, Tabitha A. Jecmen, Co-Counsel for Petitioner/Appellee

Jones, Skelton & Hochuli PLC, Phoenix, By Eileen Dennis GilBride (argued), Co-Counsel for Petitioner/Appellee

Berkshire Law Office PLLC, Tempe, By Keith Berkshire (argued), Kristi Reardon, Counsel for Respondent/Appellant

Presiding Judge Paul J. McMurdie delivered the Court's opinion, in which Vice Chief Judge David B. Gass and Judge Angela K. Paton joined.

McMURDIE, Judge:

516 P.3d 528

¶1 Michael J. Brucklier ("Father") appeals from the decree dissolving his marriage to Jennifer Brucklier ("Mother"). He argues the court erred by finding that his separate investment property belonged to the community, ordering the parties to pay their individual tax liability for the last year of marriage rather than equally dividing the total tax liability, and failing to offset his temporary child support overpayment toward his temporary child support underpayment.

¶2 We hold that the court erred by characterizing real property owned by Father's LLC as community property. The property was Father's separate property because Father acquired an equitable interest before the marriage even though he did not take legal title until after. And the use of commingled funds did not transmute the real property's character but entitled the community to an equitable lien against the property for the value of its contributions. The court also erred by apportioning the parties’ tax liability without evidence of the total amount of the debt, yielding a potentially unequal division. Finally, we hold that when a final child support order is different from the obligation under a temporary order and thus creates over- or underpayments of support, the court must offset any net over- or underpayment and account for the disparity when equitably distributing the parties’ community property.

¶3 Thus, we remand for the court to establish a community lien on the property and to otherwise conform the decree with this opinion.

FACTS AND PROCEDURAL BACKGROUND

¶4 Father was the sole member of MJB, an LLC used for real estate investment. Father entered a contract to purchase a residential investment property ("Falcon Ridge") before the marriage. Father and MJB acquired legal title to Falcon Ridge after the parties married in 2005. Mother filed for dissolution in April 2018 when the parties had three minor children. The court entered temporary orders requiring Father to pay child support pending the dissolution proceedings.

¶5 Before the trial, the parties entered into a written agreement resolving several issues, including legal decision-making and parenting time, the allocation of most debts, and the disposition of MJB. See Ariz. R. Fam. Law P. 69. The agreement confirmed MJB, as well as its assets and debts, as Father's separate property, "subject to the family court's resolution of [Mother's] claims related thereto." The court accepted the agreement as fair and equitable. See id.

¶6 After the trial, the court entered a dissolution decree concluding that an equal division of the community property was appropriate to achieve equity. The court found that community and separate funds had been commingled in the bank account held by MJB. As a result, its assets, including Falcon Ridge, were community property. The court ordered MJB's financial account to be divided equally between the parties and the real property sold with the proceeds also divided between the parties after recognizing certain separate payments made by Father.

¶7 The court also found that Father was not entitled to reimbursement for a tax garnishment imposed by the IRS that he paid with separate funds after service of the dissolution petition. Instead, the court ordered the parties to bear their individual tax liability for the year.

¶8 The court entered permanent child support orders that modified the temporary

516 P.3d 529

child support, causing over- and underpayments for certain periods. The court did not, however, offset the overpayments toward the underpayments and instead entered a past-support judgment against Father for the underpayments. See A.R.S. § 25-320(B).

¶9 Father moved to amend the decree, arguing the court erred by finding that Falcon Ridge was community property, failing to credit Father for paying more than his share of the 2017 community tax liability, and by failing to offset the temporary child support overpayment toward the underpayment. The superior court denied the motion. Father appealed, and we have jurisdiction under A.R.S. § 12-2101(A)(1), -120.21(A)(1), and Arizona Rule of Family Law Procedure 78(c).

DISCUSSION

¶10 We apply de novo review to the court's characterization of assets or debts as community or separate, but we review the court's division of those assets and debts for an abuse of discretion. Hammett v. Hammett , 247 Ariz. 556, 559, ¶ 13, 453 P.3d 1145, 1148 (App. 2019). We review child support awards for an abuse of discretion. Birnstihl v. Birnstihl , 243 Ariz. 588, 590, ¶ 8, 416 P.3d 852, 854 (App. 2018). A court abuses its discretion when the record lacks competent evidence to support its findings. Engstrom v. McCarthy , 243 Ariz. 469, 471, ¶ 4, 411 P.3d 653, 655 (App. 2018). And we defer to the superior court's factual findings unless they are clearly erroneous. Id.

A. The Superior Court Erred by Finding...