In re Deborah Michelle Kiley

2018 UT 40, 427 P.3d 1165
CourtUtah Supreme Court
DecidedAugust 14, 2018
DocketCase No. 20170472
StatusPublished
Cited by4 cases

This text of 2018 UT 40 (In re Deborah Michelle Kiley) is published on Counsel Stack Legal Research, covering Utah Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Deborah Michelle Kiley, 2018 UT 40, 427 P.3d 1165 (Utah 2018).

Opinion

Justice Pearce, opinion of the Court:

INTRODUCTION

*1166 ¶ 1 The bankruptcy court certified two questions of Utah law that lie at the intersection of family and bankruptcy law. Based upon a compelling certification order, we accepted the invitation to resolve those questions. After receiving briefing and conducting oral argument, we are left with dual concerns-that the parties have not given us the briefing we need to actually answer the questions and that our opinion might ultimately be for naught. At oral argument, Kiley's counsel admitted the deficiencies in the briefing. And the bankruptcy trustee suggested that the marital property division at the heart of this case may have violated the automatic stay that accompanies a bankruptcy petition's filing. Because of the inadequate briefing and the problematic procedural posture, we revoke certification.

BACKGROUND

¶ 2 In 2012, Deborah Kiley filed for divorce from Jarod Marrott. The district court entered temporary orders and bifurcated the proceeding; that is, the district court granted the divorce but deferred resolution of other questions, including the division of marital assets. About a year later, after Marrott had fallen behind on alimony and child support payments, Kiley filed a motion to show cause and a motion to clarify. Kiley sought to enforce the temporary orders and to recover unpaid child support and alimony.

¶ 3 The district court granted the motions and entered judgment for $121,188.22. Two months later, Kiley and Marrott participated in mediation and stipulated to a property settlement. The parties then, according to Kiley, read the stipulation into the record before the domestic relations commissioner. As part of that stipulation, and to satisfy the judgment for unpaid child support and alimony, Kiley received "all of the value in any and all of her former spouse's retirement accounts ...."

¶ 4 The day after mediation, Kiley petitioned for bankruptcy. About a month after that, the district court entered a supplemental decree reifying the settlement the parties had placed on the record. A couple months later, the district court entered the qualified domestic relations order (QDRO)-the document that would permit Kiley to access Marrott's retirement funds.

¶ 5 Kiley did not list the retirement plan proceeds on her initial bankruptcy disclosures. At a meeting with her creditors-a meeting that took place before the district court entered the order memorializing the stipulated property division-Kiley disclosed her interest in the retirement funds. A few months later, after the QDRO was entered, Kiley filed an amended schedule that included the retirement funds.

¶ 6 But Kiley claimed the retirement funds were exempt from the bankruptcy estate under Utah Code section 78B-5-505(1)(a)(xiv). 1 The trustee argued that the exemption was inapplicable because, among other reasons, Kiley was entitled to the value of the retirement funds, not the funds themselves. About a month later, Kiley filed another amended schedule and claimed that the retirement funds were exempt under *1167 Utah Code section 78B-5-505(1)(a)(xv). 2 The trustee asserted that this exemption was not available to Kiley either.

¶ 7 Against this backdrop, the bankruptcy court certified two questions to us:

1. What is the nature and scope of a party's interest in marital property as of the filing of a divorce complaint-contrasted with the nature and scope of such interest upon the entry of a divorce decree allocating such marital property? Stated differently, upon the filing for divorce, is a spouse's interest in marital property merely contingent, unliquidated, and inchoate until the entry of a divorce decree creating a vested right to receive a specific sum of money or a specific marital asset?
2. Is an individual entitled to an exemption under Utah Code Ann. § 78B-5-505(1)(a)(xv) in money or other assets payable to that individual as an alternate payee under a [qualified domestic relations order] (QDRO)? Stated more simply, is the Debtor entitled under Utah law to exempt the Retirement Plan Proceeds?

¶ 8 We accepted the certified questions, ordered briefing, and held oral arguments.

ANALYSIS

¶ 9 Certified questions can present unique challenges, as we recently noted in Zimmerman v. University of Utah , 2018 UT 1 , 417 P.3d 78 . In Zimmerman, we declined to answer two certified questions involving the Free Speech Clause of our constitution. Id. ¶¶ 1-2. We noted that "[i]f this case were before us on appeal we would have the benefit of a lower court's disposition of [these] claims. We would also be presented with the legal standards adopted by the trial court and the application of those standards to the evidence in the record." Id. ¶ 14.

¶ 10 We reasoned that these "obstacles alone are not insurmountable." Id. ¶ 16. But we concluded that the limited briefing the parties had presented us amplified the challenges inherent in answering a certified question. Id. Specifically, we were concerned that the parties had not provided the state constitutional analysis we needed to answer the certified questions. Id. ¶¶ 17-23. We noted that "[o]ur jurisdiction in answering certified questions ... is elective" and that our discretion "necessarily encompasses the authority to decline to provide a conclusive answer after reviewing the parties' briefing." Id. ¶ 27. We ultimately declined to answer the Free Speech Clause questions because the briefing did not provide us what we needed to tackle a question of that importance.

¶ 11 This case offers similar challenges. The first certified question asks us to address what interest Kiley had in the marital property at various points in time. During oral argument, Kiley's counsel acknowledged: "I am apologetic because in reading both my brief and counsel's brief, for the appellee in this case, I don't think either of us really addressed [the first question] very well." And, indeed, instead of analyzing what interest Kiley had in the martial estate, Kiley spends a portion of her brief asserting that the question did not matter.

¶ 12 Kiley argues that the "matter before the Court is far broader than an academic discussion over the distinction between equitable interests in marital property as opposed to vested interests."

The state court cites the rule that dominates current divorce law in Utah-that regardless of who the owner of record is, both parties share an interest in marital property. The nature of that interest (i.e. equitable, contingent, vested etc.) is academic. The point is that both parties share interest .... Here, Ms.

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Cite This Page — Counsel Stack

Bluebook (online)
2018 UT 40, 427 P.3d 1165, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-deborah-michelle-kiley-utah-2018.