Fite v. Fite

• Decision Date: 02 December 1970
• Docket Number: No. 101,101
• Citation: 3 Wn.App. 726,479 P.2d 560
• Court: Washington Court of Appeals
• Parties: Leslie R. FITE, Appellant, v. Betty J. FITE, Respondent and Cross-Appellant. (41294) II.

Page 726

3 Wn.App. 726

479 P.2d 560

Leslie R. FITE, Appellant, v.Betty J. FITE, Respondent and Cross-Appellant.

No. 101 (41294) II.

Court of Appeals of Washington, Division 2.

Dec. 2, 1970.

Review Denied March 2, 1971.

Neal, Bonneville, Hughes & Viert, William G. Viert, Tacoma, for appellant.

Lee, Krilich, Lowry & Thompson, Thomas C. Lowry, Tacoma, for respondent.

PEARSON, Judge.

In this action both parties are appealing from the property division made by the trial court as a part of a decree of divorce.Defendant wife also appeals from the refusal of the trial court to find that she had established grounds for divorce against plaintiff and the refusal to grant alimony.

The plaintiff, Leslie R. Fite, and the defendant, Betty J. Fite, were married on December 22, 1956 in Las Vegas, Nevada.It was a second marriage for both.No children are involved.The parties separated and this action was commenced in September, 1967.The decree, granting plaintiff a divorce and making a division of the property, was entered on April 18, 1969.At the time of the divorce, plaintiff was age 57 years and defendant was age 43 years.No alimony was granted, inasmuch as defendant was found to be in good health and employable.

The trial court found that upon defendant's admissions she had committed indiscretions with another man.This established plaintiff's grounds for divorce.The court did not believe that defendant's misconduct was justified by her testimony that she was ignored by plaintiff and that he had refused to cohabit with her for 4 or 5 years.Consequently, her application for a divorce was denied.These findings were amply supported by substantial evidence.In any event, where both parties seek a divorce, the refusal of the court to grant a divorce to one party is not considered prejudicial error.Skaare v. Skaare, 52 Wash.2d 273, 324 P.2d 815(1958).Our review will be limited to the claimed errors assigned to the division of property.

The court found that plaintiff brought to the marriage approximately $290,000 of separate property and that defendant had no property at that time.At the time of the separation the net value (before taxes) of all assets held by the parties was as follows:

 1795 shares of stock in Walker Chevrolet
                   Co., Inc. at $243 per share 1         $436,185.00
                 * Walker Chevrolet Profit Sharing Plan     23,053.24
                 * 192 shares of stock in Rainer Leasing
                   Corp., Inc.                                 26,317.00
                 * Stock trading account with Merrill
                   Lynch, Pierce, Fenner & Smith, Inc.         40,984.00
                 Notes receivable from the sale of an
                   interest in B & I Aceptance Co
                   Inc.  2                                 162,345.00
                 Other notes receivable                         8,000.00
                 * Bank account in National Bank of
                   Washington                                   3,500.00
                 * Residence with contents                  40,000.00
                                                             -----------
                                                             $740,384.24
                

The trial court awarded defendant the residence and contents ($40,000) and a cash sum of $120,000----$45,000 payable upon the entry of judgment and the balance in annual installments of $15,000 with 6 per cent interest per annum on the unpaid balance.Defendant was also awarded $10,000 for attorney's fees and $1,800 for litigation expenses.Plaintiff was awarded for balance of the assets.

Several other factors are significant in reviewing the assignments of error advanced by both parties.Plaintiff's annual earnings from Walker Chevrolet had averaged $60,000 for the 10 years prior to the divorce.These are admittedly community earnings; and while plaintiff testified that $22,000 per year was expended on community living expenses, the trial court refused to accept that testimony because it was unsupported by any records.Instead, the trial court determined that only $12,000 annually was expended on community living expenses and consequently the increased value of the total estate was due in part, at least, to the community earnings of plaintiff.³This determination is challenged by plaintiff on appeal.

When the parties arrived at Tacoma, a joint checking account was opened in the National Bank of Washington.All earnings of plaintiff from Walker Chevrolet, together with income, interest, dividends, etc., which he received from other separate assets, were deposited in this account.Bank loans, which were obtained to enable the purchase of stock in Walker Chevrolet were repaid from this checking account.This testimony is largely relied upon by defendant in her cross-appeal, to support her claim that the separate and community assets were so commingled as to make tracing of separate assets impossible.

The first major purchase of Walker Chevrolet stock occurred in 1959 when plaintiff acquired 25 per cent thereof at a cost of $90,000.To fund this purchase, plaintiff testified that he borrowed $30,000 from a Kansas bank, pledging his B & I stock (separate property) as collateral.The balance was funded by separate assets.The loan was repaid, he testified, from collections made on monies received from the B & I separate income.

In 1960plaintiff made another major purchase of the Walker Chevrolet stock for $100,000.He testified that this purchase was funded by a loan from the National Bank of Washington, again using B & I assets as collateral.In repaying this loan, plaintiff testified that he did not rely on community income from his earnings received from Walker Chevrolet, but used instead monies from assets he had prior to the time of his marriage.

In 1962plaintiff acquired the third and final block of Walker Chevrolet stock for $110,000.Again, he testified that this purchase was funded by a loan from National Bank of Washington, pledging B & I assets as collateral.At the time the parties separated, there was $81,000 due the National Bank of Washington.It was not clear from the records whether or not the stock loan had been repaid.At the time of trial, the amount due the bank was approximately $90,000.

The trial court found that approximately one-third or 613 shares of Walker Chevrolet stock at $243 per share was community property, and this is the finding which plaintiff primarily challenges on appeal.

Defendant and cross-appellant contends that the trial court erred in not finding that all of the Walker Chevrolet stock was community property--or that plaintiff's proof fell short of tracing the separate assets as a matter of law.

We will treat these conflicting contentions together, since they both involve RCW 26.08.110 and its direction that the court shall make 'such disposition of the property of the parties, either community or separate, as shall appear just and equitable * * *'.It seems to us that certain general principles apply to answer the complaints of both parties concerning the division of the property made by the trial court.

First, the trial court is required to have in mind the correct character and status of the property as community or separate before any theory of division is ordered.Blood v. Blood, 69 Wash.2d 680, 419 P.2d 1006(1966).⁴

The trial court, in finding of fact No. 5, labeled certain items of property as community property and then made certain allocations of value ($160,000) to the defendant as a 'fair and equitable division of the property of the parties'.

Found to be community property were:

                                              Value
                                                           -----------
                613 shares of Walker Chevrolet Company
                  stock at $243 per share (this
                  represented the last stock acquisition)  $148,959.00
                192 shares of Rainier Leasing Company
                  stock                                      26,317.00
                Home and contents                            40,000.00
                Walker Chevrolet Company Profit-sharing
                  Plan                                       23,053.24
                                                           -----------
                                                           $238,329.24
                

The court did not specifically find the Merrill, Lynch, Pierce, Fenner & Smith account to be community property, but the parties had both conceded that it was, at least to the extent of $41,000.The same is true as to an $8,000 note and a $3,500 bank account.Thus, of a net estate of $604,000, approximately $290,000 was found or conceded to be community property.The court allocated approximately $15,000 more than 50 per cent of the community property to the defendant and allowed $11,800 to defendant for attorney's fees and costs.

Our review of the record convinces us that the trial court was fully justified in determining that all but the last purchase of stock in Walker Chevrolet was plaintiff's separate property, and that the court did have in mind the correct character and status of the property at the time the division was made.

Since all of the stock was acquired during marriage, it is presumed to be community property, and the burden was upon the plaintiff to prove otherwise by clear and satisfactory evidence.SeeHamlin v. Merlino, 44 Wash.2d 851, 272 P.2d 125(1954).The court was apparently satisfied with the quantum of proof to establish the separate character of the first two acquisitions of Walker Chevrolet stock.Not only did the trial court have plaintiff's testimony that separate assets were used or pledged to acquire those purchases of the stock, but also there was the uncontradicted testimony that separate assets were all that was available to account for those purchases.Accordingly, we must reject defendant's contention that the trial court erred in finding these assets to be plaintiff's separate property.

On the other hand, the court did not believe the quantum of proof to be sufficient to overcome the presumption that the last stock acquisition was community property.Plaintiff's testimony with reference to this purchase was not substantiated by any documents to show that separate assets were in...