Griffin v. Griffin

• Decision Date: 16 March 1982
• Docket Number: No. 13728,13728
• Citation: 102 Idaho 858,642 P.2d 949
• Parties: Carol V. GRIFFIN, Plaintiff-Appellant, v. William A. GRIFFIN, Defendant-Respondent.
• Court: Idaho Court of Appeals

Page 949

642 P.2d 949

102 Idaho 858

Carol V. GRIFFIN, Plaintiff-Appellant, v. William A. GRIFFIN, Defendant-Respondent.

No. 13728.

Court of Appeals of Idaho.

March 16, 1982.

Holly Mercer of Cantrill & Skinner, Boise, for plaintiff-appellant; David W. Cantrill, Boise, on the brief.

Stanley W. Welsh of Clemons, Cosho & Humphrey, Boise, for defendant-respondent.

SWANSTROM, Judge.

In this appeal we take the third judicial look at the division of property in a divorce case. The magistrate who tried the property issues determined that a residence called the Vallejo property was the separate property of the husband. The wife appealed to the district court contending the magistrate should have found the Vallejo property to be community property, either under the theory that it had been acquired and improved largely by the expenditure of community funds and the labor of the parties, or because its character had been "transmuted" from separate to community. The district court reviewed the record, affirmed the magistrate's decision, and awarded attorney fees to the husband on appeal. The wife appealed again. We affirm, except as to the award of attorney fees.

In February, 1975, William Griffin entered into a contract to purchase the Vallejo property, paying $1,000 down and agreeing to pay $260 monthly. At the time of purchase a partially completed home was on the property. Appellant and respondent, although not married, were living together at a different location. Both parties contributed their labor in fixing up the Vallejo property. In May, 1976, the parties were married. Each continued to work on the Vallejo property, and in September, 1976, they moved onto the property. The house at that point was habitable but not completed. In September the property was refinanced by a $35,000 loan. The loan application was signed by both parties and it stated that title to the property would vest in the names of both as joint tenants. A note and deed of trust were signed by both parties and both were liable for the loan. William Griffin's contract was paid off by the lender, and the seller's deed, dated February 5, 1975, naming "William Allen Griffin, a single person, the grantee," was recorded. Thereafter record title to the property remained in the husband's name. The parties made payments on the loan from community funds, and both worked toward finishing the property. In 1977 the husband spent approximately $8,000 of his separate funds in improvements.

In January, 1978, the parties separated. The wife continued to live on the property, made the loan payments, and expended additional community funds and her labor in its upkeep. Between January, 1978, and July, 1979, these payments of principal, interest, taxes and insurance made by the wife from community funds totaled $5,712. She also expended $2,567 of community funds for repairs and improvements. The original loan balance was reduced by less than $1,000 by all of the payments made by the parties.

On March 9, 1979, the parties were divorced but no division of the parties' assets and debts was made because of an expected settlement. The settlement did not occur, and the magistrate conducted a hearing on the property issues in July, 1979.

The magistrate determined that the Vallejo home was the separate property of the husband, acquired before marriage, with a value of $42,500 at the time of the marriage. He found its value had increased to $60,000 by the time of the divorce. The magistrate also found the expenditure of community funds and labor resulted in $5,000 of the increase in value, and $12,500 of the increased value was due to "natural enhancement in value resulting from the general and rapid increase in real property values in Ada county." The magistrate also heard evidence concerning numerous items of personal property. The Vallejo property was decreed to be the sole and separate property of the husband, and he was made responsible for payment of the loan balance of approximately $34,000. As part of the overall division of community assets and liabilities the wife was allowed $2,500, representing one-half of the increased value of the Vallejo property due to expenditure of community funds toward its improvement.

Because the judgment of the magistrate was affirmed on appeal to the district court, our function in this appeal is to review independently the record of the proceedings conducted by the magistrate to determine whether there is substantial and competent evidence to support the magistrate's findings of fact and whether the magistrate's conclusions of law follow from those findings. Nicholls v. Blaser, 102 Idaho 559, 633 P.2d 1137 (1981).

The wife asserts the magistrate erred in determining the Vallejo home was the husband's separate property. She contends, because community funds were used in making payments on the property, and because the refinancing loan, used to pay off the seller and obtain title, was signed by both spouses, the property should have been characterized as community property. This contention is contrary to Idaho law.

In Fisher v. Fisher, 86 Idaho 131, 383 P.2d 840 (1963), a case where the husband entered into an installment contract to purchase property prior to marriage, the Idaho Supreme Court held the property took on the character of his separate property. The court held that the use of community funds to make payments on the purchase price does not change the character of the property from separate to community. However, the non-owner spouse has the right to reimbursement for one-half of the community funds applied toward payments on the property. 86 Idaho at 136, 383 P.2d at 843. Here the magistrate did not err in finding the Vallejo home was the separate property of William Griffin when it was acquired.

No issue has been raised in this appeal that the magistrate failed to allow the community a proper credit for the expenditure of community funds to make the mortgage payments on Vallejo. Likewise it is not contended that the magistrate failed to correctly apply Idaho law in determining the extent and amount of the wife's reimbursement for expenditure of community funds and labor in improving the Vallejo property. See Suter v. Suter, 97 Idaho 461, 546 P.2d 1169 (1976).

The second issue we address is the transmutation issue. "Transmutation is a broad term used to describe arrangements between spouses which change the character of property from separate to community and vice versa." W. Reppy and W. DeFuniak, Community Property in the United States, 421 (1975).

The wife claims that even if the Vallejo home originally was William Griffin's separate property there was a transmutation of its status from separate to community when it was refinanced in September, 1979. The wife claims the magistrate erred in concluding that the property retained its separate nature.

In his findings of fact and conclusions of law, the magistrate did not discuss the transmutation issue. He merely found the property retained its separate character, which is to say, of course, that no transmutation had occurred. On appeal the district court noted the uncertainty as to whether the doctrine of informal or oral transmutation exists in Idaho. See Hooker v. Hooker, 95 Idaho 518, 523, 511 P.2d 800, 805 (1973). The district judge concluded that because the Idaho Supreme Court has not clearly accepted or rejected the transmutation concept it would assume the doctrine might be applicable. The district court then looked to the decisions of other community...