Huff v. Huff, 1 CA-CV 12-0164
| Decision Date | 16 April 2013 |
| Docket Number | 1 CA-CV 12-0164 |
| Parties | In re the Marriage of: SHARON KATHLEEN HUFF, Petitioner/Appellant, v. BRIAN REED HUFF, Respondent/Appellee. |
| Court | Arizona Court of Appeals |
See Ariz. R. Supreme Court 111(c); ARCAP 28(c);
(Not for Publication -
Rule 28, Arizona Rules of
Civil Appellate Procedure)
Appeal from the Superior Court in Maricopa
The Honorable Thomas L. LeClaire
GILLESPIE SHIELDS & DURRANT
By DeeAn Gillespie Strub
Mark A. Shields
Attorney for Petitioner/Appellant
Mesa
BURCH & CRACCHIOLO, P.A.
By Daryl Manhart
Jessica Conaway
Attorney for Respondent/Appellee
Phoenix
¶1 Sharon Kathleen Huff ("Wife") appeals from a decree of dissolution denying her requests for spousal maintenance andattorneys' fees from Brian Reed Huff ("Husband"). We reverse and remand for reconsideration of the spousal maintenance and attorneys' fees awards because the family court erred in its consideration of Husband's financial resources.
¶2 After nineteen years of marriage, the parties filed for dissolution in 2011. The parties stipulated that Husband would pay Wife $875 a month in temporary spousal maintenance and $3,500 for her attorneys' fees.
¶3 The main issue at trial was Wife's request for spousal maintenance. The parties agreed that Wife qualified for spousal maintenance under Arizona Revised Statutes ("A.R.S.") section 25-319(A) (2007). The family court specifically found that Wife lacked sufficient property and earning ability to support herself, the marriage was of long duration, and Wife's age precluded her from gaining employment adequate to become self-sufficient. See A.R.S. § 25-319(A)(1), (2), (4).1
¶4 The family court concluded that the parties' earnings were comparable and that it was precluded from considering, "inany fashion," Husband's separate property resources for purposes of spousal maintenance. The court also concluded that it could not base a spousal maintenance award on the expected future payment of a promissory note to Husband. The court denied Wife's request for spousal maintenance and additional attorneys' fees.
¶5 Wife filed a timely notice of appeal. We have jurisdiction pursuant to A.R.S. § 12-2101(A)(1) (Supp. 2012).
¶6 Wife argues the denial of spousal maintenance was erroneous. "The question of spousal maintenance is left to the sound discretion of the trial court, and an appellate court will not substitute its judgment for that of the trial court unless there has been a clear abuse of discretion." Deatherage v. Deatherage, 140 Ariz. 317, 319, 681 P.2d 469, 471 (App. 1984). An abuse of discretion occurs where the record fails to substantially support the family court's decision or where the court commits an error of law in reaching its decision. State v. Cowles, 207 Ariz. 8, 9, ¶ 3, 82 P.3d 369, 370 (App. 2004). We determine that the family court made an error of law.
¶7 It was undisputed that Wife qualified for an award of spousal maintenance under A.R.S. § 25-319(A). The fact thatWife qualified under § 25-319(A), however, did not require that the family court award her spousal maintenance. The language of the statute is permissive: "the court may grant a maintenance order" to a spouse meeting one of the four factors listed. A.R.S. § 25-319(A) (emphasis added). The amount of any award is governed by the factors listed in § 25-319(B) and is discretionary. Rainwater v. Rainwater, 177 Ariz. 500, 502, 869 P.2d 176, 178 (App. 1993). After balancing the factors, a court may determine that no amount of support should be paid to a spouse who met the threshold requirements of § 25-319(A).
¶8 Wife's argument that the family court erred in this regard may be a result of the court's analysis which conflated the threshold elements of § 25-319(A) with some of the § 25-319(B) factors. Although the court's findings do not precisely follow the statutory framework, the record supports the court's ultimate conclusion that Wife meets the requirements for a spousal maintenance award under § 25-319(A).2
¶9 In determining the amount and duration of the support award, the court must consider several statutory factors, including the ability of the paying spouse to meet his or her needs while paying support and the spouses' comparative financial resources. See A.R.S. § 25-319(B)(4) & (5). Wife argues the family court erred in its assessment of these factors. The court stated that it could not consider Husband's separate property assets in considering these two factors. Our review of the interpretation and application of statutes is de novo. Warner v. Sw. Desert Images, LLC, 218 Ariz. 121, 136, ¶ 49, 180 P.3d 986, 1001 (App. 2008). We conclude the court incorrectly interpreted § 25-319(B).
¶10 The language of § 25-319(B)(4) does not limit the type of property the court may consider in assessing the paying spouse's ability to meet his or her needs. Nor does § 25-319(B) limit the type of "financial resources" the court may consider. These terms are not defined in § 25-319(B). However, in determining a party's financial resources for purposes of § 25-319(A), this court held that "property" means "all property capable of providing for the reasonable needs of the spouse seeking maintenance[,]" including "community and separate property awarded to the maintenance-seeking spouse." Deatherage, 140 Ariz. at 320, 681 P.2d at 472. It also includes"property presently producing income as well as property capable of producing income or otherwise transformed in order to provide for the reasonable needs of the spouse." Id.
¶11 Although Deatherage interpreted § 25-319(A) and the property of the spouse seeking support, we will apply the same definition of property to subsection 25-319(B). See State ex rel. Larson v. Farley, 106 Ariz. 119, 122, 471 P.2d 731, 734 (1970) (). Additionally, if it is appropriate to consider the separate property of the spouse seeking support in determining that spouse's ability to meet his or her needs, it is equally appropriate to consider the paying spouse's separate property in determining his or her ability to pay support. We conclude the family court erred as matter of law in failing to consider the separate property resources available to Husband in determining the amount and duration of the spousal maintenance.3
¶12 Husband testified that he had $50,000 of separate property funds in a bank account at the time of trial. The court failed to consider these funds for purposes of § 25-319(B). The fact that these funds are Husband's separate property does not preclude the court from considering them as a financial resource available for Husband to meet his own needs and, if warranted, pay support to Wife.
¶13 Husband's separate property also included a $500,000 promissory note secured by real property payable to him, in part, a few months after the trial with the balance due one year later. The family court did not consider this property. Husband argues that the court did not err because this separate property was not immediately payable and the court need not consider speculative future payments.
¶14 This court has held that speculative future events "should not be considered in establishing the present rights of the parties relating to spousal maintenance." Chaney v. Chaney, 145 Ariz. 23, 27, 699 P.2d 398, 402 (App. 1985) (citing In re Marriage of Rowe, 117 Ariz. 474, 476, 573 P.2d 874, 876 (1978)). The appropriate procedure is for the party seeking a change in spousal maintenance "to wait until that future time, and if the expected change occurs, then petition for modification." Chaney, 145 Ariz. at 23, 699 P.2d at 402.
¶15 Although the amount and due dates of the promissory note were not speculative, it was not certain that the note would be paid in full as anticipated. Despite that fact, thenote was secured by real property which would not disappear if the note was not paid. A promissory note, particularly a note secured by real property, has a current value to the holder and is not merely speculative. See e.g. A.R.S. § 36-2934.02 (2009) (). Husband's interest in the promissory note secured by real property is distinguishable from a purely speculative future event or hypothetical earnings. See e.g. Chaney, 145 Ariz. at 26-27, 699 P.2d at 401-02 (); Brevick v. Brevick, 129 Ariz. 51, 54, 628 P.2d 599, 602 (App. 1981) (); Richards v. Richards, 137 Ariz. 225, 226, 669 P.2d 1002, 1003 (App. 1983) (). The family court should have considered the income-producing potential of the secured promissory note in evaluating Husband's financial resources. See Deatherage, 140 Ariz. at 320, 681 P.2d at 472. Accordingly, the court erred in deciding that the $500,000 promissory note as secured by the deed of trust was not a financial resource currently availableto Husband for purposes of deciding the appropriate amount of spousal maintenance.
¶16 We reverse the spousal maintenance award and remand for reconsideration of Husband's separate property assets. We note, without expressing any opinion on the matter, that the amount of spousal maintenance may change on remand.4
¶17 Additionally, we need not address Husband's argument that the evidence supports the award of zero dollars. Furthermore, Husband's argument that Wife waived any objection to the...
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