Nuss v. Nuss

• Decision Date: 27 April 1992
• Docket Number: No. 28180-1-I,28180-1-I
• Parties: , 60 USLW 2747, 15 Employee Benefits Cas. 1919 In re the Marriage of Charles Ralph NUSS, Respondent, v. Jill Kathleen NUSS, Appellant.
• Court: Washington Court of Appeals

Page 334

65 Wn.App. 334

828 P.2d 627, 60 USLW 2747, 15

Employee Benefits Cas. 1919

In re the Marriage of Charles Ralph NUSS, Respondent, v. Jill Kathleen NUSS, Appellant.

No. 28180-1-I.

Court of Appeals of Washington Division 1.

April 27, 1992.

Laura Buckland, Catherine W. Smith and Edwards Sieh, Wiggins & Hathaway, Seattle, for appellant.

Timothy Ryan and Brinster, Templeman & Ryan, Inc., P.S., Everett, for respondent.

BAKER, Judge.

Jill Kathleen Nuss appeals the order dissolving her marriage to Charles Ralph Nuss, alleging the trial court erred in: (1) charging rent for her postseparation occupancy of the community home; (2) awarding Charles half the equity in the home on the ground that he brought it into the marriage; (3) distributing the value of her reserved sick leave account as an asset; and (4) finding that the parties' marital community ended in February 1988.

FACTS

The parties were married in 1983. As of the dissolution trial date, the husband was earning a net monthly income of approximately $3,000. He was 60 years old and had recently undergone heart bypass surgery. The wife was earning a net monthly income of approximately $2,800. She had an MBA degree, was 44 years old, and was in good health.

At the time of the parties' marriage, the husband owned a home in Bothell and the wife owned a home in Everett. They decided to live in the Bothell home and added a second building to the property--a log cabin connected to the original rambler by a 20-foot passageway. The log cabin had no kitchen or laundry facilities of its own. The husband and wife used the cabin as their bedroom suite while their children from prior marriages lived in the rambler. The parties also repaired and redecorated the rambler when they built the cabin.

The building and repair projects were initially financed through a small loan and lines of credit. These were absorbed into a new mortgage when the parties refinanced the property in 1984. During the refinancing process, the husband quitclaimed his interest in the Bothell property to the marital community. Community funds were used to pay for the interim financing as well as the mortgage payments.

In February 1988 a domestic violence protection order was entered giving the wife exclusive possession of the rambler and requiring that the husband live exclusively in the cabin. Pursuant to that order, the husband and his son lived in the cabin, cooking on a hotplate and in a microwave oven and washing their clothes at a laundromat. The wife and her two children lived in the rambler. The parties continued to participate in marital counseling. They socialized together and continued to attempt reconciliation until shortly before the husband filed a petition for dissolution in November 1989.

The trial court found that the marital community ended when the domestic violence protection order was entered in February 1988. The court then charged the wife rent for her occupancy of the Bothell rambler after the parties' separation, on the ground that the husband had made all of the mortgage, tax and insurance payments on the property. The rental amount was counted as a personal property award to the wife and also subtracted from the community's equity in the home. The court also determined that the Bothell property had been converted to community property by the husband's quitclaim deed in 1984.

The court found that the wife's Everett home was worth $115,000 to $120,000, subject to $35,000 in mortgages. It found that the Bothell property was worth $240,000, of which $71,000 was attributable to the cabin, and that the community had an equity of $147,000 in the property. The court gave the husband a credit of one-half the equity for having brought the Bothell property into the marriage. The remaining equity in the home, after subtracting the wife's rental amount, was awarded to the husband in order to equalize the parties' overall community property awards.

The court determined that one of the wife's employment benefits at Boeing, a reserved sick leave fund known as the Financial Security Plan, was an asset for distribution and awarded it to the wife. The court calculated the community's interest in the parties' respective retirement benefits based on the separation date of February 1988. By its computations, the trial court divided the remainder of the community property approximately equal between the parties, after deducting the Bothell property credit to the husband.

RENTAL CHARGE ON COMMUNITY PROPERTY

The trial court found that the Bothell property was community property. It also found that following the parties' separation in February 1988, appellant lived in a portion of the Bothell property basically rent-free for 39 months ¹ while respondent made the payments on it. There was no evidence at trial concerning the reasonable rental value of the portion of the property occupied by appellant. Nevertheless, the trial court assigned it a rental value of at least $500 per month, based on the fact that appellant's property in Everett, which was worth no more than half the value of the Bothell property, secured a rental income of $660 to $850 per month. The total rent for 39 months came to $19,500. Appellant assigns error to the imposition of rent, the valuation of rent at $500 per month, and the counting of rent as both a personal property asset to her and a deduction from the community's interest in the Bothell property.

It is common for one spouse to be given exclusive possession of the family home during the pendency of a dissolution action. The value of such occupancy normally plays a role in concomitant temporary decisions of the court concerning issues such as child support, maintenance and allocation of debt payments. In appropriate circumstances, a trial court may consider disparate pendente lite allocation of community debts and resources in its allocation decisions at trial.

It is highly unusual, however, to retroactively assign a rental charge to the spouse occupying the family community property home during the pendency of the case, and then reduce that spouse's distributive share of community property accordingly. As in this case, such a determination may significantly impact the residency decisions and requests of a spouse long after the fact. The question before us is whether in this case such a determination was permissible within the broad discretion accorded to trial courts involved in the frequently complicated process of sorting out and fairly distributing the assets and debts of the parties in a marital dissolution action.

The trial court was concerned over the apparent inequities resulting to the husband because he paid the mortgage taxes and insurance on the property during the lengthy pendency of this action, with no contribution from the wife, who received substantial income during the same period with little or no ability to account for its expenditure at trial. These are understandable concerns which may be reflected in the court's disposition of the parties' assets and debts, perhaps by utilizing a reimbursement theory, ² or simply by means of an unequal distribution of community assets.

We have found no Washington case directly addressing whether, in a marital dissolution context, a spouse can be charged rent for occupying a portion of community real property. We doubt that such an approach would be proper in any case, but we are convinced that it was improper in this one. The concept was not suggested by either party, and for good reason. Both parties occupied this community property throughout the period in question. There was no evidence which would have permitted a sound determination of rental values of the portions of the property occupied by each; indeed, the unique living arrangements of the parties during this period raise serious questions about any attempt to compare the property, or some separate but interconnected parts thereof, to single occupancy rental property located in another area (i.e., the Everett property).

We therefore reverse the trial court's imposition of rent chargeable to appellant. ³

AWARD OF EQUITY IN BOTHELL PROPERTY

The trial court found that respondent had converted the Bothell property from separate to community property. Respondent was given a credit of one-half the community equity in the property for having brought it into the marriage. The court based this award on a finding that no more than half the present value of the property, and probably less than that, was the result of community effort and increase in value since it became community property. The court also based its award on the short duration of the marriage, the younger age and better health of appellant, and her good economic prospects. Appellant challenges this decision.

RCW 26.09.080 requires the trial court to make a just and equitable disposition of property, considering all relevant factors, including the nature and extent of community and separate property, the duration of the marriage, and the economic circumstances of each party at the time of distribution.

Former RCW 26.08.110, repealed in 1973, allowed the court to consider additional factors in distributing property, including "the party through whom the property was acquired". In Belmondo v. Belmondo, 3 Wash.App. 958, 480 P.2d 786 (1970), this court relied on that language to approve an award of almost 89 percent of the equity in a community property farm to the wife. The award was based on the wife having brought the farm into the marriage and on the fact that its increase in value was not attributable to the efforts of the husband. Belmondo, 3 Wash.App. at 960-61, 480 P.2d 786. We rejected the husband's argument that the farm should have been divided more equally because it had been converted to community property. We noted that the statute allowed consideration of the party through whom the property was acquired, and that the farm had remained the wife's separate...