Arizona Court of Appeals Rules on TDRL Benefits in Arizona Divorce Case

Posted on June 9, 2010 by Alexander D. Nirenstein

In Davies v. Beres, FC 2007-091006, Husband appealed the decision of the family court which concluded that post-dissolution military Temporary Disability Retired List (TDRL) benefits were partially community property, subject to apportionment. The Court of Appeals, Division One, concluded that TDRL benefits are the separate property of the disabled spouse. In this case, Husband and Wife were married approximately 11 years. During the marriage, Husband served in the United States Air Force, accumulating 121 months of service.

Husband maintained Wife had no interest in his TDRL benefits because he was ineligible for retirement for longevity, he was not retired and his status on TDRL was temporary. Wife believed she was entitled to a percentage of the TDRL benefits based on the fixed formula in the divorce Decree. The Court of Appeals found:

Although neither Williamson nor Thomas addresses the
first formula available to calculate TDRL benefits, we find the
cases persuasive. Both cases concluded the USFSPA, 10 U.S.C. §
1408(a)(4)(C), prevented their respective courts from dividing
TDRL benefits as marital property when the benefits were
21 calculated based upon percentage of disability. Williamson, 205
P.3d at 542; Thomas, 286 S.W.3d at 666. We agree with that
conclusion. To the extent Husband’s TDRL benefits could have
been calculated pursuant to the first formula, we decline to
find such benefits constitute community property for the reasons
previously explained. Accordingly, we vacate the family court’s
order awarding Wife an interest in Husband’s TDRL benefits.

For more information on Arizona community propertly law see ourwebsite.

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Anita Baker avoids jail in court battle

Posted on March 4, 2010 by Alexander D. Nirenstein


Singer-songwriter Anita Baker will not go to jail today and is negotiating to allow a judge to research how much her ex-husband is owed in music royalties. See Detroit News article.

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***Recent Ruling *** Unequal Division Not Limited To Short-Term Marriages

Posted on February 26, 2010 by Alexander D. Nirenstein

Arizona Divorce LawyersYesterday, Arizona Court of Appeals, Division 1, issued a published opinion, Flower v. Flower, wherein they dismissed the argument that an unequal division under Toth v. Toth is limited to marriages of extremely short duration.  

Moreover, there is language in the opinion suggesting that length of marriage is only one factor in this analysis, and that courts need to look to overall contributions.  Suffice to say, Flower might exponentially expand the scope of cases in which litigants seek an unequal division of property who would otherwise have accepted the fact that he or she had little real chance of persuading the trial court to deviate from an unequal division.  We will wait to see whether the Arizona Supreme Court has something to say about it.

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Recent Ruling - Undisclosed Line of Credit on Marital Residence

Posted on January 15, 2010 by Alexander D. Nirenstein

 

The Court of Appeals affirmed The Honorable Judge Hugh Hegyi's ruling in Frantz v. Frantz, 2009 WL 4981533 (Ariz.App. Div. 1), a case that dealt with an issue that is becoming more and more common in Arizona as a result of the State's heavy financial reliance of the real estate market. In Frantz, Husband appealed from a decree of dissolution arguing that the family court erred in its determination that a second lien secured by the marital residence was not a community obligation. At the dissolution hearing, Husband, Wife, and a real estate appraiser testified.  Judge Hegyi stated:

“In finding that the community has $92,000 in equity in the [residence], the court does not deduct the value of the $84,000 second lien on that property. It finds that WIFE has established by clear and convincing evidence that the lien is not a community obligation. The money was received by HUSBAND alone. HUSBAND alone had the ability to explain what happened to the proceeds of the loan, and has failed to do so. After observing the parties' demeanor in testifying, the court finds HUSBAND expended these proceeds in a manner that was not intended to, and did not, benefit the community."

Husband filed a motion to alter or amend the decree requesting that the court value the residence at $8,000 - an amount reflecting the fair market value minus any and all of the liens and encumbrances obtained by the parties during the marriage. The court denied Husband's motion.

Husband first argues that the trial court erred in finding that the second lien secured by the marital residence was not a community obligation. The Court of Appeals found no error stating:

"Husband submitted a statement indicating that the balance on the line of credit was $83,096 as of March 2007. Husband only testified that the line of credit was opened prior to February 2007, and that he wanted the value of the residence to reflect the two liens that were secured by the house. Wife testified that she was not aware of what the funds from the line of credit were used for. Wife also testified that she did not believe that the line of credit should be included in reducing the equity in the property. Based on the above, the trial court did not err in finding that that Wife overcame the presumption that the second lien was a community obligation."

Bottom line, credibility counts!  What Judge Hegyi obviously concluded was that the Husband tried to pull a "fast one" and was caught without an explanation as to where the money went.  The Court of Appeals agreed.  The moral of this case can be summed up as follows: "if it smells funny, something probably stinks" or if you prefer, "where there is smoke there is usually fire".
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Worker's Compensation Ruled to be Community Property

Posted on December 19, 2009 by Alexander D. Nirenstein

In an Arizona Divorce case, if you are injured during the course of your employment and are compensated for lost wages or medical expenses, then those proceeds are considered community property.  However, if you are compensated for injury to your well-being, then those proceeds are considered your sole and separate property.  The importance of this determination is that if you are getting divorced, the divorce court has the authority to divide community property between you and your spouse; however, they do not have authority to divide your sole and separate property. 

 

In Gersten v. Gersten , a recent court case determined by the Arizona Court of Appeals, the Court ruled that proceeds received by husband from an injury incurred in the course of his employment with the United States Post Office were community property. In so ruling, the Court noted that the purpose of husband’s FECA (Federal Employee’s Compensation Act) benefits were to compensate husband for his lost wages, loss of earning capacity, and medical expenses.  Since any wages earned during a marriage are community property and any debts paid during the marriage for medical expenses are paid by the community, any benefits paid to compensate for these losses are considered community assets.  Conversely, if you are compensated for injury to your self or your well being, then those proceeds are considered sole and separate property.

Similarly, a personal injury award may be considered compensation for lost wages, medical expenses, or injury to your self or well being.  Whether a worker’s compensation or personal injury award it is possible that the proceeds include community property and separate property components.  It is the burden of the spouse claiming that any portion of the award is separate property to prove that to the family court in a divorce action. 

In addition to compensation for injury to one’s self or well being, gifts to an individual are considered separate property.  Thus, in Gersten, husband tried to argue to the Court that the worker’s compensation received was a gift to him and thus should be his sole and separate property -- the court denied this argument however because worker’s compensation is not considered a gift.

If you have any questions about your worker’s compensation, personal injury award, or the classification between community and separate property contact Nirenstein Garnice Soderquist PLC - Arizona Divorce & Family Law Firm.
 

This article was written by Leslie A. Satterlee, Esq., an attorney at Nirenstein Garnice Soderquist, PLC, who focuses her practice on divorce and family law matters.
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Arizona Divorce Law Primer

Posted on August 25, 2009 by LexBlog

Arizona Divorce -- No Fault Jurisdiction.  According to Arizona divorce laws, you do not need to prove grounds in order to receive a divorce. The Arizona court will grant a petition for divorce on the grounds that there has been an irretrievable breakdown of the marriage. This is referred to as an Arizona no-fault divorce. Additionally, one of the spouses must have been a resident in the state of Arizona for 90 days prior to the filing of the petition for divorce in AZ.

 

Alimony & Community Property in Arizona.  Arizona is known as a community property state, which can be defined as any asset acquired or income earned by a married person while living with his or her spouse. According to Arizona divorce laws this means that the marital property must be divided fairly or equitably and without regard to marital fault. Separate property, or property owned prior to the marriage will be retained by the owning spouse. Spousal maintenance, also known as spousal support or alimony, can be awarded to either the husband or wife. Such factors as the length of the marriage, the parties’ prior living standard, etc. are considered in determining the amount and duration that should be paid and which is considered just. Marital fault may not be taken into account in this decision.

 

Arizona Child Support, Child Visitation and Child Custody. The main focus in determining child custody, according to Arizona divorce law, is the best interest of the children. However, under AZ divorce laws, the parents may submit a parenting plan with the request for joint custody. Visitation rights within reason are typically awarded to the non custodial parent. Child support (a percentage of the non-custodial parents’ income paid to assist with the support of his children) is determined by the Income Shares model, based on the gross income of both parents as set forth by divorce law in Arizona. Expect to pay child support until the age of 18 or until the child is a high school graduate.

 

To find out more contact www.ngslaw.com.

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