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Transmutation of Separate and Non-Separate Property to Marital Property
© 2005 National Legal Research Group, Inc.
OREGON: In re Marriage of Winkler, ___ Or. App. ___, 115 P.3d 948 (2005)
The trial court did not err by making an equal division of a jointly titled home and vineyard, traceable to the husband's separate property but treated as a marital asset during the marriage. The trial court did not err by refusing to divide an investment account, traceable to the husband's separate property and subject only to limited family use. The trial court properly awarded the wife $800,000 as an extraordinary division of the husband's separate property, where she needed the funds to retain her accustomed standard of living, and no spousal support was awarded.
Upon divorce, the parties disputed the division of two assets: a home and vineyard titled in both parties' names, and an investment account titled in the husband's name alone. The trial court divided the home and vineyard equally, and refused to divide the investment account. Both parties appealed.
The home and vineyard were purchased during the marriage. Since both parties were independently wealthy and lived off of trust income rather than salary, the purchase was apparently made from traditionally separate property. The court conceded that the wife made no direct financial contribution to the acquisition of the home, and assumed that she was not a homemaker. Nevertheless, the equal division was affirmed, on the basis that the home and vineyard were used for family purposes:
[T]here is ample evidence that those properties were commingled into the joint assets of "the marital partnership." Id. at 146, 92 P.3d 100. Husband and wife jointly held the home and vineyard. They shared control of both, worked together remodeling and enlarging their home, and worked together in the vineyard. The parties raised their children in the home and treated the properties as joint assets, and wife relied on that understanding. There is no evidence that husband ever treated the properties as his separate assets. Under the circumstances of this case, equity requires that the home and vineyard be included in the property division. We conclude not only that husband did not rebut the presumption of equal contribution, but also that the commingling of the home and vineyard required that those assets be treated as joint assets of the marital partnership. The trial court did not err in awarding wife one-half the net value of the home and vineyard.
115 P.3d at 954. The trial court's refusal to divide the investment account was also affirmed, because that account had been subject to very limited family use:
Generally, husband demonstrated his intent to keep this property his separate asset. Husband limited wife's interest in the account to her monthly allowance of $1,000. The parties agreed that out of this monthly allowance wife was required to pay her share of the grocery bills and a portion of the clothes she purchased for the children. It appears that the parties agreed to keep much of their finances separate. There is no evidence that husband intended the account to be a joint marital asset.
Husband's intent to keep the U.S. Bancorp account separate is also demonstrated by a comparison with the home and vineyard. We have previously held that the home and vineyard were part of the marital partnership. That was based, in part, on evidence of husband's intent. For example, even though husband furnished the proceeds to purchase both the home and vineyard, the properties were held jointly with wife. The parties shared control of the home and vineyard. Both parties performed physical labor on the properties. By contrast, the U.S. Bancorp account was acquired before the marriage. Husband never added wife as a joint owner.
Id. at 954-55.
The trial court also awarded the wife $800,000 from the husband's separate property, to assist her in maintaining her accustomed lifestyle after the divorce. Relying significantly upon the 15-year length of the marriage, combined with the wife's lesser level of inherited and gifted resources, the appellate court affirmed. While Oregon law permits the division of separate property where the division is equitable on the facts, the factors considered in making and affirming the award are very similar to the factors which courts in other states would consider in making an award of lump-sum spousal support. The court did not award any periodic spousal support to the wife.
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