FILED DECEMBER 5, 2019 In the Office of the Clerk of Court WA State Court of Appeals, Division III
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION THREE
In the Matter of the Marriage of ) ) No. 35641-8-III JUDITH K. TULLENERS, ) ) Appellant, ) ) and ) PUBLISHED OPINION ) ANDRE J. TULLENERS, ) ) Respondent. )
SIDDOWAY, J. — Judith Tulleners appeals the trial court’s division of
property in the decree dissolving her marriage to Andre Tulleners. After her
appeal was filed, Andre Tulleners died, and his estate, which was substituted as
respondent, has moved the court to find the action abated and dismiss the appeal.
We hold that because Judith is challenging only property provisions of a
final decree, abatement does not apply. On the merits, we conclude that the trial
court’s findings in support of two adjustments to the property division are
inadequate for appellate review. We reverse the trial court’s total dollar awards of
community property and remand for the entry of additional findings. No. 35641-8-III In re Marriage of Tulleners
FACTS AND PROCEDURAL BACKGROUND
Judith Tulleners and Andre Tulleners were married for 18½ years, in what
was a second marriage for both. When Judith filed for divorce in May 2016, she
and Andre were both in their early 70s and retired. Both were living on social
security and retirement assets.
At the divorce trial, Judith was able to provide a calculation from the
administrator of her public employment retirement plan for the percentage of her
pension payment that was community versus separate property. The administrator
determined it was 67.6 percent separate property and 32.4 percent community
property. Her retirement plan included a small defined contribution component,
worth $11,872, to which she contributed before and during the marriage. The
court characterized it as commingled and, therefore, community property.
Andre had worked for 32 years for Williams Companies, which provided a
pension benefit and later a 401(k) plan. Contributions were made to both during
the 8½ years of his marriage preceding his retirement in 2006. He cashed out his
pension benefit upon retirement. At the time of the divorce trial, he held what
remained of that lump sum payment and his 401(k) in two individual retirement
accounts (IRAs) and an annuity. At the time of the parties’ separation, the
combined value of those assets was $767,924.
2 No. 35641-8-III In re Marriage of Tulleners
Andre offered virtually no evidence of the contributions made toward his
retirement benefits during the 8½ employed years of the marriage. He offered
evidence that at the time the dissolution of his first marriage became final—which
was six months before his marriage to Judith—his 401(k) account was worth
$375,000, half of which ($187,500) was awarded to him in that earlier divorce.
He offered evidence that when he retired in 2006, the value of the account was
$357,017.
It was Judith’s position that much of the $357,017 value at retirement was
community property. She testified that when Williams Companies’ stock crashed
in the early 2000s, her husband told her that the value of his 401(k) had declined
to $40,000. She claims that he asked, and she agreed, that they would rely
primarily on her income to pay expenses so that he could maximize contributions
to rebuild his 401(k). Although Mr. Tulleners denied at trial that he ever told
Judith his 401(k) account had declined in value to $40,000, he acknowledged that
it did decline because of problems with its investment in Williams
Communications stock. He also agreed that he told Judith he wanted to maximize
his contributions to the account, and that he did maximize his contributions to the
401(k) account during the marriage.
Mr. Tulleners provided evidence that when he retired in May 2006, the
lump sum he received in lieu of a pension benefit was $514,106. He rolled that
3 No. 35641-8-III In re Marriage of Tulleners
amount into one of two IRAs, later moving assets back and forth between the
IRAs. In 2013, he used $300,000 of the IRA funds to purchase an annuity.
The trial court’s decision explaining its division of assets stated that Mr.
Tulleners offered “no evidence . . . as to the structure of [the] pension, such as the
amounts or timing of the contributions by Mr. Tulleners’ employer.” Clerk’s
Papers at 87. Mr. Tulleners also offered “no documentation as to how and when
contributions were made to [the 401(k)] account between May 1997 and May
2006 when he took the funds upon retirement.” Id. at 87-88. Because there was
no tracing done by Mr. Tulleners, the trial court characterized his IRAs and
annuity as entirely community property.
The court placed the following values on the parties’ community and
separate property:
Community property: $1,019,914, plus a 32.4 percent interest in Judith’s pension payments. ($767,924 in value of the community property comprised investment assets acquired with Andre’s part separate-part community pension payout and 401(k) account)
Judith’s separate property: $251,730 plus her 67.6 percent separate property interest in her pension payments
Andre’s separate property: $20,000
4 No. 35641-8-III In re Marriage of Tulleners
Judith’s separate property consisted of assets inherited from her mother that
she had maintained as separate. The nature of Andre’s separate property is not
clear, but the characterization and values of these separate properties is not
challenged on appeal.
Had the trial court divided the community property equally, each party
would have received approximately $510,000. Had it combined all of the separate
and community property for which it had values and divided the total equally,
each party would have received $645,822. Instead, in a memorandum opinion, the
court awarded the assets in the following manner:
Community property Separate property
Andre $718,172 plus a QDRO1 $20,000 addressing the community interest in Judith’s pension payments
Judith $301,742, plus a QDRO $251,730 plus the 67.6 addressing the community percent separate property property interest in her pension interest in her pension payments payments
See Report of Proceedings (RP)2 at 293.
1 Qualified domestic relations order. See 29 U.S.C.A. § 1056(d)(3)(A). 2 The report of proceedings contains a pagination error. The pages numbered 167 through 172 are followed by another six pages numbered 167 through 172. For all references beginning with the second page numbered 167, our citations are to the page numbers in their actual sequence rather than the numbers affixed by the court reporter.
5 No. 35641-8-III In re Marriage of Tulleners
Judith challenged the significant disparity in her and Andre’s community
property awards. The trial court addressed her objection at the presentment
hearing on the final papers. It pointed out that the total community and separate
property awarded to Judith was $553,472, approximately $184,500 less than the
$738,172 total of community and separate property it awarded to Andre, and then
explained:
[Judith’s public employment pension] wasn’t valued. And I appreciate that when we split something exactly in half on a pension, it doesn’t really matter what we value. In this case it had to matter to me, if you will, because [Judith] was receiving . . . roughly 68 percent of that pension as a separate property asset. And so there is a value to that. And then she received half the community. And there is a value to that. So ultimately she received 82, 83 percent. .... Secondly, although I characterized [Andre’s] pension, which is a two-part item, the pension and his 401k that he had, or the defined benefit and defined contributions portion of his pension as community, because [Andre] failed to trace appropriately, and I thus divided it. I did have in mind that the evidence in my mind was clear that [Andre] walked away from his prior marriage with $187,000 sitting in what I’ll call the 401k side of his pension. And you’ll notice again the difference here is about 185 between the two estates. So essentially I took that into consideration that he couldn’t tell me if there was any interest earned on it, he couldn’t trace it back. The accumulations after that, who knows. But I considered the fact that he had walked into the marriage with—setting aside the defined benefit side because we didn’t have tracing documents sufficient on that—setting aside that, this to me it was clear he walked into the marriage with a significant asset, and I gave him some credit for that. Obviously I’m not doing a dollar for dollar or that’s not the point, but I gave him some credit for total equity.
6 No. 35641-8-III In re Marriage of Tulleners
RP at 295-97.
The final papers were entered in late September 2017. Judith timely
appealed.
Following commencement of the appeal, Judith learned that Andre had
been diagnosed with late stage amyotrophic lateral sclerosis (ALS). No evidence
had been presented at trial that Andre had health issues. Judith moved to vacate
the decree. The trial court denied the motion.
Andre died after the appeal was fully briefed, and Patrick Tulleners, his son
from his first marriage, was appointed personal representative and substituted as
the respondent. He filed a motion asking this court to determine whether
abatement applies since no third party interests were involved in the dissolution,
relying on In re Marriage of Fiorito, 112 Wn. App. 657, 660-63, 50 P.3d 298
(2002). We requested supplemental briefing on the issue of abatement. Decision
on the motion was referred to the panel.
ANALYSIS
I. ABATEMENT DOES NOT APPLY
Relying on Fiorito, the parties assume that if we find abatement to apply as
a result of Andre’s death, appellate review is foreclosed and the trial court’s
findings, conclusions, and decree will be the final word. They assume that
7 No. 35641-8-III In re Marriage of Tulleners
abatement will apply unless we find either equitable grounds for review or that
third party interests were resolved in the action below. Both assumptions
misunderstand In re Marriage of Himes, 136 Wn.2d 707, 721, 965 P.2d 1087
(1998), and the earlier case law that it overruled.
Confusion arises because the decisions on which the parties rely come up in
two different contexts. Most of the cases involve a motion or independent action
to vacate a final judgment in a divorce case after one of the parties to the marriage
has died. In the early decision in Dwyer v. Nolan, our Supreme Court held that a
final judgment in such a case cannot be challenged because
there are no proper parties to this proceeding, and that, in the nature of things, the plaintiff having died, the question of divorce cannot be relitigated. It will not be gainsaid that an action for divorce is a purely personal action. Nothing is sought to be affected but the marital status of the husband and wife. The distribution of property in such an action is incidental, and it is clearly incontestable that, upon the death of either party, whether before or after the decree, the subject of the controversy is eliminated.
40 Wash. 459, 460-61, 82 P. 746 (1905). In such cases, an appeal of the divorce
decree is not at issue.
Dwyer’s holding was a distinctly minority view. The overwhelmingly
majority view was that circumstances can exist where a challenge to a divorce
decree should be entertained even if a party to the marriage has died. Himes, 136
Wn.2d at 721 & n.38.
8 No. 35641-8-III In re Marriage of Tulleners
After first questioning the wisdom of Dwyer in Osborne v. Osborne, 60
Wn.2d 163, 166, 372 P.2d 538 (1962), the Washington Supreme Court overruled it
in Himes, holding that courts should decide on equitable grounds whether to
vacate a dissolution decree after the death of one of the parties. 136 Wn.2d at 721.
Judith and Andre’s estate also rely on cases from a separate and more
directly applicable context: cases in which a party unhappy with a property
division appeals, one of the parties to the divorce then dies, and the appellant
argues that abatement upon death has rendered the property division a nullity.
Cases eventually overruled by Himes did not hold that if abatement applies, the
decree stands, and the appeal is dismissed. They held that the divorce decree itself
becomes a nullity. In the leading case of McPherson v. McPherson, 200 Wash.
365, 93 P.2d 428 (1939), the respondent—the executor for the estate of a wife who
died during the appeal—argued that her death did not abate the trial court’s
property division, which was favorable to her, and the appellate court could review
and affirm it. The court observed:
There is much authority from other jurisdictions to sustain this contention of respondent, but we are of the opinion that, under our decisions, the interlocutory decree, in its entirety, abates and becomes a nullity upon the death of one of the parties, whether before or after the interlocutory decree is entered.
Id. at 369. The court cited to Dwyer’s holding that the distribution of property in a
divorce action is “‘incidental.’” Id. (quoting Dwyer, 40 Wash. at 460). It did
9 No. 35641-8-III In re Marriage of Tulleners
acknowledge that in Masterson v. Ogden, 78 Wash. 644, 139 P. 654 (1914), the
court had reviewed property provisions of a decree notwithstanding the death of
the husband during the appeal, but the majority viewed that decision as
“determining the rights of third parties.” 200 Wash. at 371-72. But cf.
McPherson, 200 Wash. at 373 (Blake, C.J., dissenting) (reading Masterson as
holding that an interlocutory order is final and conclusive insofar as it affects the
division of property).
At the time McPherson was decided, a trial court’s initial decree in a
divorce action was interlocutory, not final. A final decree could not be entered
until the passage of six months or the conclusion of an appeal, whichever occurred
later. See, e.g., In re Estate of Martin, 127 Wash. 44, 47-48, 219 P. 838 (1923)
(discussing REM. COMP. STAT. § 988). It is possible that the interlocutory
character of the decree explains the McPherson court’s reason for treating the
entire divorce action as abated.
The law has changed, of course; divorce decrees are now entered on a final
basis and finality of the dissolution can be delayed only if an appeal challenges the
finding that the marriage is irretrievably broken. RCW 26.09.150(1); and see, e.g.,
In re Marriage of Moody, 137 Wn.2d 979, 989, 976 P.2d 1240 (1999). No
decision following the statutory change addresses whether McPherson applies to
decrees on appeal that are final rather than interlocutory. Some have read pre-
10 No. 35641-8-III In re Marriage of Tulleners
Himes Washington case law as holding that the death of a party during any appeal
results in abatement unless the interests of third parties are affected, however. See
Francis M. Dougherty, Annotation, Effect of Death of Party to Divorce
Proceeding Pending Appeal or Time Allowed for Appeal, 33 A.L.R.4th 47, 51
(1984).
Fortunately, in overruling Dwyer as it related to an action to vacate a
divorce decree, the Himes court also addressed Dwyer’s influence on Washington
cases dealing with abatement. Himes, 136 Wn.2d at 725-26. Himes adopted the
majority rule that the death of a party to an appeal in a divorce action does not
abate the property provisions of a decree. Id. (citing Bell v. Bell, 181 U.S. 175,
178-89, 21 S. Ct. 551, 45 L. Ed. 804 (1901)).
In light of Himes, Judith is not required, in order to avoid abatement, to
satisfy us that equitable considerations or third party interests are present.
Equitable considerations only come into play when an independent action is
brought to vacate a divorce decree, as was the case in Himes. “Third party
interests” were an exception to the application of abatement in cases like
McPherson, which Himes overruled. All Judith needs to demonstrate is that she is
challenging the property provisions of a final divorce decree. She is. Abatement
does not apply.
11 No. 35641-8-III In re Marriage of Tulleners
II. ADDITIONAL FINDINGS ARE NEEDED FOR APPELLATE REVIEW OF THE TRIAL COURT’S AWARD OF COMMUNITY PROPERTY
A trial court in a dissolution proceeding is to “make such disposition of the
property and the liabilities of the parties, either community or separate, as shall
appear just and equitable after considering all relevant factors.” RCW 26.09.080.
Factors identified by the statute as relevant include the nature and extent of the
community and separate property, the duration of the marriage, and the economic
circumstances of the parties. Id.
An asset is separate property if acquired before marriage, acquired during
marriage by gift or inheritance, acquired during marriage with the traceable
proceeds of separate property, or, in the case of earnings or accumulations,
acquired during permanent separation. In re Marriage of White, 105 Wn. App.
545, 550, 20 P.3d 481 (2001). Separate property brought into the marriage will
retain its separate character as long as it can be traced or identified. In re
Marriage of Schwarz, 192 Wn. App. 180, 190, 368 P.3d 173 (2016). If
community and separate funds are so commingled that they cannot be
distinguished or apportioned, the entire amount is rendered community property.
In re Marriage of Pearson-Maines, 70 Wn. App. 860, 866, 855 P.2d 1210 (1993).
A trial court has considerable discretion in making a property division, and
“will be reversed on appeal only if there is a manifest abuse of discretion.” In re
12 No. 35641-8-III In re Marriage of Tulleners
Marriage of Muhammad, 153 Wn.2d 795, 803, 108 P.3d 779 (2005). “‘A trial
court abuses its discretion if its decision is manifestly unreasonable or based on
untenable grounds or untenable reasons.’” Id. (quoting In re Marriage of
Littlefield, 133 Wn.2d 39, 46-47, 940 P.2d 1362 (1997)).
For appellate review to be possible, a trial court’s findings of fact must
declare the ultimate facts that justify its conclusions; if they do not, an appellant is
entitled to have the cause remanded so that findings adequate for review can be
made. Phelps v. Phelps, 2 Wn.2d 272, 276, 97 P.2d 1080 (1940).
Judith and Andre were only one year apart in age at the time of divorce and
both were fully retired, so earning capacity was not an issue. The only asset not
before the court for disposition was the parties’ social security benefits, and Andre
received more than Judith: he was receiving $1,587 per month, while Judith
received $1,101. While Judith presented evidence of her earlier cancer and eye
surgeries, the court was not presented with evidence that either party had any
special financial need; the parties appear to have had equivalent needs for income
during retirement. The only factors identified by the trial court as supporting its
disproportionate award of community property was its consideration of Andre’s
untraced separate property interest in his retirement assets and Judith’s separate
property interest in her pension for which no present value evidence was offered.
13 No. 35641-8-III In re Marriage of Tulleners
Our informed guess from the trial court’s oral statements is that it was
trying to divide the property equally after recognizing that Andre’s commingled
retirement assets had a substantial separate property origin, and after imputing to
Judith an estimated value of her separate property interest in her pension. Both
were legitimate considerations, as long as the values used by the court were
supported by the evidence.
Awarding Andre a disparate share of his retirement assets finds conceptual
support in In re Marriage of Nuss, in which this court held that even “the origin of
community property as one party’s separate property may . . . be considered in
appropriate cases as a reason for awarding all or a disparate share thereof to that
party.” 65 Wn. App. 334, 341, 828 P.2d 627 (1992). Significantly, however, the
asset at issue in Nuss was not characterized as community property because of
commingling. It was a home that the husband brought to a short-term marriage
and quitclaimed to the community in connection with a refinancing. The trial
court was presented with an unchallenged value for the total equity in the home
and made an unchallenged 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.” Id. at 340. In other
words, in giving the husband a credit to account for the home’s separate property
14 No. 35641-8-III In re Marriage of Tulleners
origin, the Nuss court had reliable value and allocation information, which it
viewed in the light most favorable to the wife.
In this case, some Nuss-type credit to Andre for the value of the retirement
assets he brought into the marriage would be within the trial court’s discretion.
But when the reason for characterizing the property as community is because
Andre did not trace his separate property interest, he cannot be rewarded for
failing to trace. All credible evidence must be viewed in the light most favorable
to Judith, and reasonable inferences must support a finding that the value Andre
brought into the marriage, to the extent that value was preserved during the
marriage,3 was at least if not more than the amount of credit given.
To be clear, Andre’s retirement assets, because untraceably commingled,
are conclusively presumed to be community property, as the trial court recognized.
What is within the trial court’s discretion is to make a disparate award of those
assets to Andre if it is possible to determine a minimum value of those assets that
was brought into the marriage and preserved.
Attributing a value to Judith’s separate property interest in her pension
payments was also within the trial court’s discretion. But the value must be
supported by the evidence and the fact that Judith did not provide evidence of a
3 Any losses or declines in value during the marriage must be taken into account.
15 No. 35641-8-III In re Marriage of Tulleners
reasonable present value cannot be held against her where the court did not request
evidence of such a value from the parties. Judith proposed to divide the
community interest on a percentage, as-received basis, and provided the necessary
evidence. “An award of pension rights on a percentage, as-received basis is . . .
encouraged” because it “avoids difficult valuation problems, shares the risks
inherent in deferred receipt of income, and provides a source of income to both
spouses.” In re Marriage of Bulicek, 59 Wn. App. 630, 638, 800 P.2d 394 (1990).
The problem in this case with the trial court’s award of community property
is that it did not make a finding of the amount of Andre’s retirement assets for
which it was giving him a Nuss-type credit, and it did not make a finding of the
value it was imputing to Judith’s separate property interest in her pension plan. At
most, we can guess at the values the trial court had in mind. If the $738,172 in
community and separate assets it distributed to Andre was intended to be one-half
of the total value of the parties’ community and separate assets—not just the
community and separate property for which it had values, but adding an imputed
value for Judith’s separate property interest in her pension payments—then we can
extrapolate that the trial court gave Andre a 54 percent credit in his commingled
retirement assets ($416,430) before dividing the remaining $351,494 community
property value between the parties. We can extrapolate that it treated Judith’s
16 No. 35641-8-III In re Marriage of Tulleners
separate property interest in her pension plan as having a value of $184,700. (Our
extrapolation of these amounts is explained in the appendix to this opinion.)
If we were certain this is what the court intended, we could entertain a
challenge from Judith that the evidence—viewed in the light most favorable to
her—does not support a finding that the value of Andre’s retirement assets brought
into the marriage and preserved is at least $416,430. She would be able to
challenge the court’s attribution of a value of $184,700 to her separate property
payment stream from her pension plan.
Judith is unable to challenge the property award effectively, however,
because we do not know if these are the values assumed by the trial court, given
the incompleteness of its findings. If a Nuss-type credit to Andre is a basis for the
disproportionate award, Judith needs a finding on the amount of that credit; if a
present value for Judith’s separate property interest in her pension plan figures is a
basis for the disproportionate award, she needs a finding on that imputed value as
well. She is entitled to findings on those matters so that she can assign error if she
believes they are not supported by the record. We need findings on those matters
so that we can fairly consider her appeal.
We reverse the trial court’s total dollar awards of community property to
Andre and Judith and remand for the entry of additional findings in support of
17 No. 35641-8-III In re Marriage of Tulleners
whatever award is made. The trial court will determine what further proceedings
to conduct, if any, before entering additional findings.
Jfcilow~ Siddoway, J. .J= . WE CONCUR:
Lawrence-Berrey, C.J.
Fearing, J.
18 No. 35641-8-III In re Marriage of Tulleners Appendix
APPENDIX
If the $738,172 in community and separate assets the trial court distributed to Andre was intended to be one-half of the total value of the parties’ community and separate assets—not just the community and separate property for which it had values, but adding an imputed value for Judith’s separate property interest in her pension payments—then, using that and other values and amounts from the record (unshaded), we can calculate the value imputed to Judith’s separate property payment stream from her pension plan (JSP), the amounts of Andre’s commingled retirement assets to which the court found Andre and Judith to be entitled (AE and JE), and the portions of Andre’s commingled retirement assets that the court found to be Andre’s separate property (ASP) and community property (CP).
Asset Total value To Andre To Judith
Community property other $251,990 $125,995 $125,995 than Andre’s commingled retirement assets ($1,019,914 – $767,924)
Andre’s commingled $767,924 $592,177c $175,747c retirement assets
Meaning the commingled assets were treated as 54% Andre’s separate property and 46% community propertyd
Andre’s traceable separate $20,000 $20,000 property
Judith’s traceable separate $251,730 $251,730 property
Assumed value of Judith’s $184,700b $184,700b separate property interest in her pension
TOTAL: $1,476,344a $738,172 $738,172
19 No. 35641-8-III In re Marriage of Tulleners Appendix
a If $738,172 is intended to be one-half the total value of the couple’s assets, then total value = 2 x $738,172, or $1,476,344. b $1,291,644 is the total value of the couple’s assets other than the imputed value for Judith’s separate property interest in her pension payments (JSP), so JSP = $1,476,344 – $1,291,644, or $184,700. c $738,172 is Andre’s total property award, made up of $125,995 + $20,000 + AE (Andre’s entitlement from his commingled retirement assets). AE then equals $592,177 ($738,172 – ($125,995 + $20,000)). And since AE is $592,177, JE (Judith’s entitlement from Andre’s commingled retirement assets) is $767,924 – $592,177, or $175,747. d If the objective is that Andre’s entitlement from the commingled retirement assets (AE) is his entire separate property interest in those assets (ASP) plus one-half the community’s interest in those assets (CP), then $592,177 (AE) = ASP + ½ CP, so $592,177 – ½ CP = ASP. We know that the total commingled value ($767,924) = ASP + CP, so another thing we know about ASP is that it equals $767,924 – CP. Those equivalences to ASP must also be equal, so $767,924 – CP = $592,177 – ½ CP; $767,924 – $592,177, or $175,747 = ½ CP; $351,494 = CP; and ASP will be $416,430 ($767,924 – $351,494) As a percentage of total value, ASP is 54%, rounded ($416,430 ÷ $767,924) and CP is 46%, rounded ($351,494 ÷ $767,924).