Carpenter v. Carpenter

722 P.2d 230, 150 Ariz. 62, 1986 Ariz. LEXIS 224
CourtArizona Supreme Court
DecidedJune 2, 1986
Docket18111-PR
StatusPublished
Cited by16 cases

This text of 722 P.2d 230 (Carpenter v. Carpenter) is published on Counsel Stack Legal Research, covering Arizona Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Carpenter v. Carpenter, 722 P.2d 230, 150 Ariz. 62, 1986 Ariz. LEXIS 224 (Ark. 1986).

Opinions

HOLOHAN, Chief Justice.

This suit concerns the disposition of a death benefit which became payable upon the death of John R. Carpenter, a longtime employee of the City of Mesa. John’s former wife Opal sought a share of the death benefit. The superior court granted judgment to Opal awarding her the proceeds of the group life insurance policy on the life of John and one-half of the value of John’s retirement account as of the date of the dissolution of the marriage of John and Opal on September 27, 1974. The trial court also awarded Opal $6000 in attorney’s fees. The value of the death benefit after September 27, 1974 and one-half the value of the pre-September 27, 1974 death benefit were awarded to Sandra, John’s second wife.

On appeal the Court of Appeals held that Opal had no right to any share of John’s retirement fund death benefit, but she should receive the proceeds of the life insurance policy which John was obligated to have maintained for her benefit under the decree of dissolution. The appellate court also reversed the award of attorney’s fees to Opal. Carpenter v. Carpenter, 150 Ariz. 130, 722 P.2d 298 (App.1985).

The material facts are undisputed. John and Opal Carpenter were married from October 9, 1937 until September 27, 1974. John Carpenter worked for the City of Mesa from June 1951 until his death on May 20,1981. John and Sandra married on February 13, 1981 and remained married until John’s death.

[63]*63Opal and John’s dissolution decree incorporated by reference a property settlement agreement the pair entered into on June 21, 1974. The agreement provided among other things that Opal remain the beneficiary of John’s group term life insurance policy carried by the City of Mesa or under like coverage obtained elsewhere. Before his death, John named Sandra the beneficiary of the term life insurance policy.

John also participated in the Arizona State Retirement System (ASRS) from February 1963 until he died. ASRS is a contribution plan, with benefits based upon and accumulated from employee salary deductions and employer contributions. A.R.S. §§ 38-748, -749; see generally A.R.S. §§ 38-741, -781.37. Neither the property settlement nor their dissolution decree mentions John’s accumulated state retirement fund benefits; neither contains any provision purporting to dispose of community assets not specifically described.

John had named Opal as his beneficiary under ASRS from February, 1963 until June 1977. Sandra became John’s beneficiary in January of 1979.1 A.R.S. § 38-781.11 provides that should an ASRS participant die prior to retirement, the participant’s named beneficiary will receive a death benefit according to a set formula. Like retirement benefits, the death benefit accumulates from salary deductions and employer contributions.

We granted Opal’s petition for review. Sandra did not seek review of the Court of Appeals decision to award the proceeds of the life insurance policy to Opal.

The two issues presented for review are whether Opal had a community interest in John’s retirement fund death benefit and whether she was entitled to the award of attorney’s fees in the superior court. We approve the appeals court decision to reverse the award of attorneys’ fees and to remand for a reconsideration of that award by the trial court. The Court of Appeals correctly noted that Opal is only entitled to attorneys’ fees for the portion of the judgment awarding her the life insurance proceeds, as it arose out of a contract. A.R.S. § 12-341.01. Opal’s retirement fund death benefit claim did not arise out of a contract. To determine an appropriate award of attorneys’ fees on remand, the trial court should consider what proportion of the case was contract-based and how much of it concerned other issues.

We took review to address only the issue whether Opal had a community property interest in her former husband’s Arizona State Retirement System death benefit even though their 1974 decree of marital dissolution predated Everson v. Everson? 24 Ariz.App. 239, 537 P.2d 624 (1975).

Retirement Benefits as Community Property

John Carpenter’s ASRS retirement pension was a contributory pension, based upon and accumulated from salary deductions and employer contributions. A.R.S. §§ 38-748, -749. The Arizona courts recognized that contributory plans were community property as early as Warren v. Warren, 2 Ariz.App. 206, 407 P.2d 395 (1965). Warren stated that a spouse’s “contributions [to an employee stock plan] prior to divorce consisted in [sic] deductions from his salary, which certainly qualifies as community property;” Id., 2 Ariz.App. at 207-08, 407 P.2d at 396-97. Community property, including contributory financial plans, is subject to division by the court. Id.; see also Koelsch v. Koelsch, 148 Ariz. 176, 713 P.2d 1234, 1239 (1986); Johnson v. Johnson, 131 Ariz. 38, 41, 638 P.2d 705, 708 (1981).

John and Opal’s property settlement agreement and their dissolution decree did not dispose of his ASRS pension benefits. The record does not disclose why the pair made no provision at the time of divorce for the pension plan. Because the parties do not urge an outside agreement to clarify [64]*64the omission, however, we need not address what motivated it. Although the property agreement declares “[a]ny and all property acquired by either of the parties hereto from and after the date hereof shall be the sole and separate property of [that party],” it does not provide for disposition of uncatalogued or undisposed of community property.

Despite their failure to dispose of the pension in the property settlement, the portion of John’s ASRS retirement benefit earned up until John and Opal’s marital dissolution is nevertheless community property. Therefore, Opal remains entitled to a share of the pension’s value at that time. The parties agreed that the value as of that September date was $16,197.11.

John and Opal’s marital dissolution occurred in 1974. Sandra advances the argument that it is against public policy for Opal to reopen or reexamine her divorce decree and property settlement with John. Sandra cites Reed v. Reed, 124 Ariz. 384, 604 P.2d 648 (App.1979), and Guffey v. LaChance, 127 Ariz. 140, 618 P.2d 634 (App.1980) as the controlling authority on the issue. The Court of Appeals agreed with Sandra’s position.

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Carpenter v. Carpenter
722 P.2d 230 (Arizona Supreme Court, 1986)

Cite This Page — Counsel Stack

Bluebook (online)
722 P.2d 230, 150 Ariz. 62, 1986 Ariz. LEXIS 224, Counsel Stack Legal Research, https://law.counselstack.com/opinion/carpenter-v-carpenter-ariz-1986.