Deavila v. Deavila

Decision Date10 August 2017
Docket NumberNo. 20160024-CA.,20160024-CA.
Citation402 P.3d 184
Parties Cristy DEAVILA, Appellant, v. Pericles DEAVILA, Appellee.
CourtUtah Court of Appeals

Ben W. Lieberman, Attorney for Appellant.

Stacy J. McNeill, Eric B. Vogeler, Salt Lake City and Jenna Hatch, Attorneys for Appellee.

Judge Jill M. Pohlman authored this Opinion, in which Judges Gregory K. Orme and J. Frederic Voros Jr. concurred.1

Opinion

Pohlman, Judge:

¶ 1 Cristy DeAvila, now known as Cristy Brown, appeals the trial court's division of marital assets under a decree of divorce. We affirm.

BACKGROUND

¶ 2 Brown and Pericles DeAvila married in 2004, separated in 2013, and divorced in 2015. At a one-day bench trial, the parties disputed, among other things, the division of two assets relevant to this appeal, namely, the insurance proceeds stemming from the destruction of a vehicle (the Lexus) and the stock from DeAvila's company (the Sector 10 stock).

¶ 3 At trial, Brown took the position that the Lexus was her separate property and that she should retain all of the insurance proceeds. Brown had listed the Lexus in her name on her financial declaration, and she testified that DeAvila bought the Lexus and gave it to her as a gift for her birthday. According to Brown, DeAvila had a vehicle "through [his] business," and Brown had paid the insurance on that vehicle. When the business vehicle was totaled, DeAvila used proceeds from the insurance to buy the Lexus. Brown further testified that the Lexus was "destroyed" during the parties' separation and that she believed DeAvila was responsible for the damage because she "saw him driving by [her] house" within fifteen minutes of hearing "loud bashes" in her garage. After this incident, which totaled the Lexus, Brown received an insurance check for $17,371. Because, in her view, DeAvila "intentionally destroyed" the Lexus, Brown alternatively asserted that even if the Lexus was deemed to be marital property, DeAvila was "not entitled to the benefit of the insurance proceeds under the collateral source rule."

¶ 4 DeAvila asserted that the parties were "jointly listed as owners" of the Lexus. He testified that he purchased the Lexus, believed he was an owner, and titled it in his name. DeAvila provided supporting evidence, including the 2009 bill of sale and the sales contract for the Lexus, which named DeAvila as the buyer. He also provided an exhibit with the application for original title, identifying himself as the primary owner and Brown as the secondary owner, but the record does not contain a copy of the original certificate of title.

¶ 5 DeAvila further asserted that shortly after the Lexus was damaged, Brown re-titled the Lexus "exclusively in her name." In support, he provided a corrected certificate of title, dated after the Lexus was damaged, which listed only Brown as an owner. In his trial brief, he stated that he was "being prosecuted for charges associated with damage done" to the Lexus, and at trial he invoked the Fifth Amendment to the United States Constitution, refusing to answer questions about whether he damaged the car. Nonetheless, DeAvila claimed that Brown should pay him one-half of the insurance proceeds as his marital share.

¶ 6 With regard to the Sector 10 stock, Brown asserted that Sector 10 was a publicly traded company whose stock was traded " ‘over the counter’ " and testified that the stock's market price as of the day of trial was five cents per share.2 She testified that she held Sector 10 stock in her name, amounting to at least 400,000 shares. Brown urged the trial court to award DeAvila "his separate assets, including all shares in the Sector 10 [entities]," stating that "[w]hatever shares ... are out there ... he should be awarded those shares." She further urged the court to value the Sector 10 stock at the market price of five cents per share.

¶ 7 DeAvila, for his part, alleged in his trial brief that he had transferred to Brown "at least 11 million shares of Sector 10 stock," which were worth ten cents per share in 2008, totaling $1.1 million. He further alleged that Brown had dissipated that asset, and he sought a judgment for his half of the value of that stock. At trial, he testified that the current Sector 10 stock price was "[f]ive to seven cents" per share. But DeAvila also testified that the company had no value and was "going to basically file [for] bankruptcy" due to the fact that attorneys who were handling litigation on its behalf on a contingency fee basis had recently "dropped" the case. In closing argument, he encouraged the court to value the shares at five cents per share.

¶ 8 During his testimony, DeAvila referred to the company's Form 10-K that Sector 10 had filed with the Securities and Exchange Commission approximately one month before trial. The 10-K stated that Sector 10's common stock had "an average market value of $.05 per share" and indicated that the stock traded on the Pink Sheets.3 The 10-K also disclosed pending litigation matters and resulting uncertainties, and showed that for the prior year, the company was operating at a loss and had an overall lack of revenue, income, and assets.

¶ 9 The trial court entered a decree of divorce in December 2015. Among other things, the court found that the parties owned a boat and four vehicles at the time of separation. It further found that one of those vehicles, the Lexus, "was destroyed" and subsequently declared a total loss by the insurance company. The court found that Brown had received $17,371 in insurance proceeds for the Lexus and that those proceeds were a marital asset. The court then awarded three of the vehicles to Brown and a boat and one of the vehicles to DeAvila. Because the value of the property awarded to Brown was worth more than that awarded to DeAvila, the court determined that DeAvila was "entitled to a judgment of $8,325 for the difference in value."

¶ 10 As for the Sector 10 stock, the trial court determined that "the issue of who owns what shares in the company is moot," relying on DeAvila's testimony that "the company's only asset is a lawsuit where attorneys were on a contingent fee basis and have withdrawn, and as a result, the lawsuit is expected to be dismissed." The court thus awarded any and all shares, interest, or value in Sector 10 to DeAvila. Brown appeals.

ISSUES AND STANDARDS OF REVIEW

¶ 11 Brown advances two main contentions on appeal. First, Brown contends that the trial court erred when it treated the insurance proceeds from the Lexus as a marital asset and awarded half of the proceeds to DeAvila. She argues, in the alternative, that the collateral source rule barred DeAvila from receiving a portion of the insurance proceeds. Second, Brown contends that the trial court erred when it failed to value the Sector 10 stock at the market price of five cents per share.

¶ 12 District courts generally have "considerable discretion concerning property distribution [and valuation] in a divorce proceeding and their determinations enjoy a presumption of validity." See Dahl v. Dahl , 2015 UT 79, ¶ 119, ––– P.3d –––– (citation and internal quotation marks omitted); see also Lindsey v. Lindsey , 2017 UT App 38, ¶ 26, 392 P.3d 968. As a result, this court "will uphold the decision of the district court on appeal unless a clear and prejudicial abuse of discretion is demonstrated." Dahl , 2015 UT 79, ¶ 119, ––– P.3d –––– (citation and internal quotation marks omitted). Showing an abuse of discretion "is a heavy burden, and we can properly find abuse only if no reasonable person would take the view adopted by the trial court." Goggin v. Goggin , 2013 UT 16, ¶ 26, 299 P.3d 1079 (citation and internal quotation marks omitted). Additionally, "[i]n reviewing a property distribution, we will not set aside findings of fact, whether based on oral or documentary evidence, unless they are clearly erroneous, and we give due regard to the district court's superior position from which to judge the credibility of witnesses." Dahl , 2015 UT 79, ¶ 121, ––– P.3d ––––. In evaluating whether the trial court correctly declined to apply the collateral source rule, we review that decision for correctness. Mahana v. Onyx Acceptance Corp. , 2004 UT 59, ¶ 35, 96 P.3d 893.

ANALYSIS
I. Insurance Proceeds

¶ 13 Brown contends that because the Lexus was her separate property, the insurance proceeds stemming from its destruction should not have been divided between her and DeAvila. In the alternative, Brown contends that even if the Lexus was marital property, "[DeAvila] was not entitled to a share of the [insurance] proceeds under the collateral source rule." We address each argument in turn.

A. Determination of Marital Property

¶ 14 Brown argues that the Lexus was her "sole and separate property," asserting that her "testimony that the Lexus was a birthday gift, coupled with the existence of the title solely in her name, should have been deemed conclusive by the trial court that the Lexus was indeed a gift and her separate property." Brown therefore contends that DeAvila is not entitled to a marital share of the insurance proceeds resulting from the car's destruction. We conclude that the trial court acted within its discretion when it deemed the insurance proceeds to be marital property subject to equitable distribution.

¶ 15 Utah law presumes that "marital property will be divided equally while separate property will not be divided at all." Lindsey v. Lindsey , 2017 UT App 38, ¶ 32, 392 P.3d 968 (citing Dahl v. Dahl , 2015 UT 79, ¶ 121, ––– P.3d –––– ). Utah law further "presumes that property acquired during the marriage is marital property subject to equitable distribution." Dahl , 2015 UT 79, ¶ 26, ––– P.3d ––––. Indeed, "[m]arital property is ordinarily all property acquired during the marriage ..., ‘whenever obtained and from whatever source derived.’ " Dunn v. Dunn , 802 P.2d 1314, 1317–18 (Utah Ct. App. 1990) (quoting Gardner v. Gardner , 748 P.2d 1076, 1079 (Utah 1988) ); see also Bradford v. Bradford , 1999 UT App 373, ...

To continue reading

Request your trial
6 cases
  • Wadsworth v. Wadsworth
    • United States
    • Utah Court of Appeals
    • March 3, 2022
    ...discretion in determining the proper method for calculating the value of marital property. See DeAvila v. DeAvila , 2017 UT App 146, ¶ 12, 402 P.3d 184 ("District courts generally have considerable discretion concerning property distribution and valuation in a divorce proceeding and their d......
  • Wadsworth v. Wadsworth
    • United States
    • Utah Court of Appeals
    • January 13, 2022
    ...discretion in determining the proper method for calculating the value of marital property. See DeAvila v. DeAvila, 2017 UT App 146, ¶ 12, 402 P.3d 184 ("District courts have considerable discretion concerning property distribution and valuation in a divorce proceeding and their determinatio......
  • Wadsworth v. Wadsworth
    • United States
    • Utah Court of Appeals
    • January 13, 2022
    ...discretion in determining the proper method for calculating the value of marital property. See DeAvila v. DeAvila, 2017 UT App 146, ¶ 12, 402 P.3d 184 ("District courts have considerable discretion concerning property distribution and valuation in a divorce proceeding and their determinatio......
  • Gerwe v. Gerwe
    • United States
    • Utah Court of Appeals
    • April 26, 2018
    ...find abuse only if no reasonable person would take the view adopted by the [district] court." DeAvila v. DeAvila , 2017 UT App 146, ¶ 12, 402 P.3d 184 (quotation simplified).¶18 At trial, Husband testified that the value of the brokerage account at the time of separation was approximately $......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT