Kakinami v. Kakinami
| Decision Date | 16 May 2012 |
| Docket Number | No. SCWC–29340.,SCWC–29340. |
| Citation | 276 P.3d 695,127 Hawai'i 126 |
| Parties | Bonnie Macleod KAKINAMI, Respondent/Plaintiff–Appellee, v. Aaron K.H. KAKINAMI, Petitioner/Defendant–Appellant. |
| Court | Hawaii Supreme Court |
Peter Van Name Esser for petitioner.
Robert M. Harris for respondent.
Aaron Kakinami challenges the Family Court of the Fifth Circuit's Supplemental Divorce Decree, on the ground that the family court erred in not awarding him a share of Bonnie Kakinami's Marital Separate Property.1 Aaron also argues that the family court improperly modified the Supplemental Divorce Decree after he filed his Notice of Appeal by compelling him to pay Bonnie a net share of her interest in the marital residence by a certain date.
Briefly stated, Aaron and Bonnie were married in 1980. In 2006 Bonnie filed a complaint for divorce, alleging the marriage was irretrievably broken. The family court subsequently filed a Decree Granting Absolute Divorce, but reserving property division. A one-day trial was later held on the division of the parties' marital estate. At trial, Bonnie argued that a gift and several inheritances that she received during the marriage were Marital Separate Property, and thus, excluded from the marital estate and not subject to division. Aaron argued that the gift and inheritances were Marital Partnership Property and subject to division. On October 7, 2008, the family court filed a Supplemental Divorce Decree, in which it classified the gift and inheritances that Bonnie received during the marriage as Marital Separate Property and awarded Bonnie one hundred percent of that property.
On October 10, 2008, Aaron filed a notice of appeal, appealing from, inter alia, the family court's October 7, 2008 Supplemental Divorce Decree. While Aaron's appeal was pending, Bonnie filed a Motion for Order Compelling Aaron to List the Marital Residence for Sale. On February 3, 2009, the family court filed its order compelling Aaron to pay Bonnie her net share of the marital residence by February 27, 2009.
On appeal to the ICA, Aaron argued, inter alia, that the family court erred in awarding Bonnie one hundred percent of the gift and inheritances as Marital Separate Property. Aaron also argued that the family court's order compelling Aaron to pay Bonnie her share of the marital residence improperly modified the property distribution ordered in the Supplemental Divorce Decree, because Aaron's notice of appeal allegedly divested the family court of jurisdiction. The ICA affirmed. Kakinami v. Kakinami, No. 29340, 2011 WL 1836718, at *4 (SDO). With regard to Bonnie's gift and inheritance-funded accounts, the ICA, citing Schiller v. Schiller, 120 Hawai‘i 283, 205 P.3d 548 (App.2009), noted that the family court has the "authority to award Marital Separate Property to a non-owning spouse[,]" Kakinami, 2011 WL 1836718, at *2, but held that the family court did not abuse its discretion by failing to do so in this case. Id. The ICA further held that the family court had jurisdiction to enter the order compelling Aaron to pay Bonnie her share of the marital residence because the order enforced, rather than modified, the Supplemental Divorce Decree. Id. at *4.
In his application, Aaron raises the following questions:
We hold that the ICA erred in stating that the family court has the "authority to award Marital Separate Property to a non-owning spouse" under Schiller. Kakinami, 2011 WL 1836718, at *2. As explained further below, we hold that Marital Separate Property remains non-divisible under the framework first set forth in Hussey v. Hussey, 77 Hawai‘i 202, 881 P.2d 1270 (App.1994), overruled on other grounds by State v. Gonsales, 91 Hawai‘i 446, 984 P.2d 1272 (App.1999). That framework is consistent with partnership principles adopted by this court, and provides parties a practical means of segregating a specific type of asset acquired during the marriage, while still permitting the family court to divide the parties' estate in a "just and equitable" manner pursuant to Hawai‘i Revised Statutes (HRS) § 580–47.
We further hold that the family court did not abuse its discretion when it adhered to the Partnership Model of property division in dividing the parties' Marital Partnership Property, because the existence of an inheritance, without more, does not mandate deviation. We also hold that the family court had jurisdiction when it issued its February 3, 2009 post-decree order because the order enforced a preexisting obligation. Accordingly, we affirm the judgment of the ICA.
The following factual background is taken from the record on appeal.
Aaron and Bonnie were married on June 14, 1980. On March 9, 2006, Bonnie filed a complaint for divorce, alleging the marriage was irretrievably broken.2 In his answer, Aaron agreed that the marriage was irretrievably broken. The divorce involved the division of the parties' nearly two million dollar estate.
On September 27, 2007, the family court granted Bonnie's request to bifurcate the divorce proceeding. Thereafter, the family court filed a Decree Granting Absolute Divorce (Bifurcated Divorce Decree) on October 1, 2007.3 Although the primary purpose of the decree was to dissolve the marriage and reserve the division of property and debts for trial, the family court awarded certain assets. The decree, inter alia, awarded the marital residence to Aaron, provided that he buy out Bonnie's one-half interest. The decree stated in pertinent part, "[Aaron] shall forthwith deposit in escrow an amount that equals one-half of the fair market value of the marital residence minus one-half the current mortgage debt."
After extensive discovery by both parties, a one-day trial was held on July 25, 2008 on the division of the parties' marital estate. The parties testified in relevant part as follows.
Bonnie, a 59–year old teacher, testified that she received a gift and several inheritances from two family members during the course of her marriage. Specifically, Bonnie testified that in 1992, she received a $10,000 gift from her stepmother, Violet McLeod, and placed it in a newly-opened account at Owens Mortgage Investment (Owens account). Bonnie placed Aaron's name on the Owens account when it was opened, but testified that she did not intend to make a gift of that money to Aaron. That same year, Bonnie also received a $50,000 inheritance from her aunt's estate, which she put in the Owens account. Bonnie indicated that the 1992 gift and inheritance were intended for her, and not for both her and Aaron. Bonnie testified that in 1995, she removed Aaron's name from the Owens account. Bonnie further testified that while Aaron's name was on the account between 1992–1995, Aaron did not contribute any funds to that account, nor did he do so at any other time. Bonnie recalled that after 1995, she withdrew money from the Owens account to pay for education and household expenses.
Bonnie testified that after 1995, she received an inheritance from her stepmother that was distributed to her in approximately the following amounts: $33,334, $308,000, $500,000, and $3,333. Bonnie testified that these monies were placed in either the Owens account or a Smith Barney account. Bonnie further testified that neither she nor Aaron have ever contributed any additional money to these accounts; she had other people managing these accounts; and Aaron knew that the money in these accounts was Bonnie's.
Bonnie testified that during the divorce proceedings, she made some withdrawals from her accounts to pay for "regular living expenses [,]" "attorneys' fees[,]" and a number of trips. Bonnie indicated that during her marriage, it was "usual and customary" for her to take trips and to pay for her children's travel expenses.
Aaron, a 56–year old attorney, testified that sometime in 2001, his law practice began to decline and he suffered from health issues. Aaron was aware that in 2002, Bonnie inherited money, but he indicated that Bonnie did not express to him verbally or in writing that she intended that the money be kept her sole property, that the money was not to be used for marital purposes, or that the money was not to be managed or touched during the marriage. Aaron then testified about how he believed the money in the parties' accounts should be divided in light of his characterization of each asset. With regard to Bonnie's "inherited money accounts," Aaron testified that Bonnie would get her basis back, but the appreciation, had there been any, would be split fifty-fifty.
Aaron also testified about withdrawals that Bonnie made from her inheritance-funded accounts during the divorce proceedings, which Aaron claimed were in contemplation of divorce. According to Aaron, these withdrawals roughly amounted to $400,000. Aaron testified that Bonnie "should be credited with having received [$]400,000." When Aaron attempted to point to his medical condition as a basis for equalization payments, Bonnie's counsel objected, stating, "If he was going to put his condition in evidence, [she] should have been permitted to get his medical records." The family court sustained the objection.
At the court's direction, the parties submitted their closing arguments in writing. The parties' closing arguments centered around the...
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