Porter v. Porter

416 P.2d 564, 101 Ariz. 131, 34 A.L.R. 3d 933, 1966 Ariz. LEXIS 291

• Court: Arizona Supreme Court
• Decided: July 14, 1966
• Docket: 7594 PR
• Status: Published

Opinions

BERNSTEIN, Vice Chief Justice.

Pursuant to 17 A.R.S. Rule 47(b), Rules of the Supreme Court and A.R.S. § 12-120.24, we granted a petition to review the decision of the Court of Appeals, Division 1, reported in 1 Ariz.App. 363, 403 P.2d 298.

The history of this protracted litigation is detailed in the Court of Appeals decision as well as Kemble v. Stanford, 86 Ariz. 392, 347 P.2d 28; Porter v. Stanford, 86 Ariz. 402, 347 P.2d 35, cert. den. 371 U.S. 829, 83 S.Ct. 23, 9 L.Ed.2d 66 and Kemble v. Porter, 88 Ariz. 417, 357 P.2d 155. We will merely highlight the pertinent facts. On May 14, 1959 Gladys E. Porter, appellee, obtained an Arizona judgment for separate maintenance after constructive service upon her husband Arnold Porter by publication and registered mail which he acknowledged. She had attached the Arizona Hotel in Phoenix when she filed her complaint which described the hotel as community property. The judgment imposed a lien on the hotel in excess of $25,000 for support payments of $3,000 monthly which were later reduced to $1,000 per month. On July 21, 1959 the trial court entered a judgment determining the arrearage due under the separate maintenance judgment and three days later Gladys obtained execution and levied upon the hotel to satisfy an amount over $31,500. The July 21, 1959 judgment was a final judgment. McClanahan v. Hawkins, 90 Ariz. 139, 367 P.2d 196. The sheriff’s sale was held August 20th and all of Mr. Porter’s interest in the hotel was sold to Gladys who received a sheriff’s deed April 7, 1960. As a result of the sale and upon receipt of this deed, Gladys became the sole owner of any interest in the hotel which she and Arnold had theretofore held as community property as well as any interest which Arnold held as his separate property. A.R.S. § 25-342, subsec. B.

Eleven days after the Arizona separate maintenance judgment was entered, Arnold Porter sued Gladys for divorce in Idaho. She answered seeking full faith and credit for the Arizona judgment and participated in the Idaho divorce proceedings. On December 28, 1960 nearly seventeen months after Gladys bought Arnold’s interest in the Arizona Hotel at the sheriff’s sale and nine months after she obtained the deed thereto, the Idaho court refused to give the Arizona judgment full faith and credit. Furthermore, that court found that the Arizona Hotel was owned by a partnership in which Gladys and Arnold had an interest as community property. Arnold Porter was awarded all community property interest in the partnership which owned the hotel and Gladys was given ten days to “execute and deliver unto (Arnold Porter) a transfer and conveyance of all right, title, interest and equity * * * that the defendant (Gladys) has in those properties known as the Arizona Hotel * * Pursuant to the court’s command, Gladys executed quitclaim deeds and assignments of her interest in the hotel.

This appeal arises out of appellants’ intervention in Gladys’ separate maintenance action wherein appellants alleged that the Arizona Hotel was owned by a partnership in which they together with Arnold Porter had an interest. After the Idaho judgment was rendered, appellants filed supplemental complaints in intervention seeking full faith and credit for the Idaho court’s judgment that the hotel was owned by a partnership and that Gladys had no further interest in the Arizona Hotel by virtue of the quitclaim deed, assignment and release of the Arizona judgment. U.S. Const. Art. IV, § 1; 28 U.S.C.A. § 1738. Trial was had on December 18, 1961 in the Superior Court of Maricopa County. Documentary evidence was introduced but there was no testimony. The trial court granted a directed verdict for Gladys and this appeal followed.

Certain facts must be emphasized to properly frame the problem before us. In Porter v. Stanford, supra, this court said:

“ * * * It (the trial court) had jurisdiction of the parties (Gladys and Arnold) and of the subject matter of the litigation and jurisdiction to enter an order in such amount as it deemed proper for (Gladys and the children) support pendente lite.”

sj< * * * *

" * * * It also had authority not only to order the husband to pay such amount pendente lite but it also had authority to direct a receiver of the community property to do so.”

* * * * * *

“ :|: * * The presumption that it is community property (the Arizona Hotel) therefore obtains and will continue to prevail in favor of Gladys E. Porter until it is destroyed by evidence to the contrary.” 86 Ariz. 406-407, 347 P.2d 40.

Arnold Porter has never attempted to introduce evidence rebutting the presumption. There is a presumption that real property owned by husband and wife is community property and nearly conclusive evidence is required to overcome the presumption which alone will support a judgment. Kennedy v. Kennedy, 93 Ariz. 252, 379 P.2d 966.

Payments for separate maintenance become vested when they become due and cannot be modified thereafter. McClanahan v. Hawkins, supra. A judgment based upon such payments is entitled to full faith and credit. Sistare v. Sistare, 218 U.S. 1, 30 S.Ct. 682, 54 L.Ed. 905.

No authority need be cited to support the validity of a separate maintenance judgment where a resident spouse attaches property in Arizona and serves the nonresident spouse by registered mail as provided in Rule 4(e), 16 A.R.S. Porter v. Duke, 34 Ariz. 217, 270 P. 625. The court has jurisdiction to determine the rights of the nonresident spouse in the attached property. 24 Am.Jur.2d Divorce and Separation, §§ 546, 935, 995. We have recognized the validity of a separate maintenance suit which based jurisdiction over a nonresident spouse upon the fact that community real property was attached in the state. White v. White, 83 Ariz. 305, 320 P.2d 702. Moreover, we have recognized that a lien in favor of the wife may attach to the husband’s share of community owned partnership property. Spector v. Spector, 94 Ariz. 175, 382 P.2d 659. In this regard, we note that partnership assets acquired during coverture are community property and belong to both spouses. Coe v. Winchester, 43 Ariz. 500, 33 P.2d 286. The sheriff may sell the attached property, whether separate or community, to satisfy a judgment for past due support payments and the nonresident spouse is bound by the sheriff’s sale to the extent of his interest in the property. Pennington v. Fourth National Bank, 243 U.S. 269, 37 S.Ct. 282, 61 L.Ed. 713.

The above principles will be referred to as we analyze the problem before us. Stated most simply, the issue is whether the trial court erred in directing a verdict for Gladys based on the conclusion that appellants failed to prove the Arizona Hotel was owned by a partnership. Apart from the documentary evidence which we shall consider subsequently, appellants relied primarily upon the Idaho judgment. Hence, we must decide whether the Idaho judgment is entitled to full faith and credit. We think not. We note that appellants do not ask us to merely give full faith and credit to the Idaho judgment. Instead, we are asked to give it greater credit than the prior Arizona judgments. We do not think the full faith and credit clause requires such a conclusion.

In the first place, the Idaho court was obliged to give full faith and credit to the Arizona separate maintenance judgment and to the later judgment based upon the arrearage for support payments. Pursuant to these judgments, Gladys obtained all of Arnold’s interest in the hotel which thereafter was her separate property. We pointed out above that as between Gladys and Arnold, there was adjudication that she owned his interest in the hotel and there was no community property interest in the hotel. That adjudication was entitled to full faith and credit in the Idaho trial court. American Exp. Co. v. Mullins, 212 U.S. 311, 29 S.Ct. 381, 53 L.Ed. 525. The Idaho Supreme Court recognized that its trial court may have erred in refusing to grant full faith and credit to the Arizona judgments. Gladys appealed that part of the divorce decree which prohibited her from maintaining, instituting or prosecuting any action affecting the Arizona Hotel and the Idaho Supreme Court said the judgment was too broad because:

“ * * * This enjoinder will prevent appellant from exercising any rights which she may have outside the present action and to all rights which may enure to her in the future by virtue of this decree or otherwise.” Porter v. Porter, 84 Idaho 400, 373 P.2d 327, 332. (Emphasis supplied)

The Idaho judgment is fatally defective because it failed to give the prior valid Arizona judgments full faith and credit and, therefore, is not entitled to full faith and credit by this court. Reynolds v. Stockton, 140 U.S. 254, 11 S.Ct. 773, 35 L. Ed. 464; Dixon v. Dixon, 76 N.J.Eq. 364, 74 A. 995; Hanna v. Stedman, 230 N.Y. 326, 130 N.E. 566.

Secondly, the Idaho judgment is not entitled to full faith and credit because the Idaho court had no jurisdiction, power or authority in the divorce proceeding to enter an order distributing property which was Gladys’ separate property and not community property. At the sheriff’s sale, Gladys acquired all of Arnold’s interest in the Arizona Hotel and it follows that the hotel was not community property thereafter. Idaho is a community property state and the court “divides” the community property only when it grants a divorce. Idaho Code § 32-712. The Supreme Court of Idaho has said that:

“ * * * The court has the power under said section (32-712) to divide the community property between the parties, but has no power or authority to award the wife’s separate property, or any part of it, to the husband.” Heslip v. Heslip, 74 Idaho 368, 262 P.2d 999, 1002. (Emphasis supplied)

It is axiomatic that full faith and credit need not be given to the judgment of the Idaho court because it acted without jurisdiction. Estin v. Estin, 334 U.S. 541, 68 S.Ct. 1213, 92 L.Ed. 1561.

There is a third reason why the Idaho judgment is not entitled to full faith and credit. A foreign judgment will not be given greater effect than a domestic judgment on the same issue. This court has held that the Arizona Hotel was community property as between Gladys and Arnold by virtue of a strong presumption which was never overcome and has recognized that Gladys Porter could obtain Arnold’s interest in the hotel as her separate property by purchasing it at the sheriff’s sale to satisfy her judgment for support payments due her. The full faith and credit clause does not compel us to overrule our decision by recognizing the Idaho judgment were we to concede its validity. The United States Supreme Court has said that “The rule of primacy to the first final judgment is a necessary incident to the requirement of full faith and credit.” Hanson v. Denckla, 357 U.S. 235, 256, 78 S.Ct. 1228, 1241, 2 L.Ed.2d 1283. The case of Hammell v. Britton, 19 Cal.2d 72, 119 P.2d 333 quotes with approval from Martin Bros. Box Co. v. Fritz, 228 Iowa 482, 292 N.W. 143 as follows:

“ ‘The full faith and credit clause requires the courts of one state to give to the judgment of a court of another the same effect that is accorded such judgment in the latter state, (citations omitted) Under such clause, since the Iowa judgment has been adjudicated to be valid in Iowa, the Indiana court should have enforced such judgment. It refused to do so. We know of no decision which would support the proposition that, if a judgment has been adjudicated to be valid and enforcible by a court in Iowa, but enforcement of such judgment is thereafter refused by a court in Indiana, the Iowa court must then follow the example of the Indiana court and also refuse to enforce such judgment. We are unwilling to so construe the full faith and credit cause.’” 119 P.2d 339.

The Supreme Court of Nevada has said:

“Analysis demands the conclusion that (plaintiff) does not here ask us to merely accord full faith and credit to the Maryland decree. Instead, we are asked to give it greater credit and respect than the prior decree of our own State lawfully entered. Full faith and credit does not require, nor does it contemplate, such actions from us.” Colby v. Colby, 78 Nev. 150, 369 P.2d 1019, 1023, Cert. denied 371 U.S. 888, 83 S.Ct. 186, 9 L.Ed.2d 122. Accord: Perry v. Perry, 51 Wash.2d 358, 318 P.2d 968; Astor v. Astor, Fla.App., 107 So.2d 201, cert. den. 120 So.2d 176; Atkinson v. Kettler, Tex.Civ.App., 372 S.W.2d 704 affd Sup., 383 S.W.2d 557.

It is argued by appellants that the Arizona judgments are entitled to full faith and credit as between Gladys and Arnold only. We determined their rights in the hotel but not the rights of appellants. It would follow that the Idaho court was not faced with a final judgment in the action between Gladys and appellants concerning ownership of the hotel and the Idaho judgment is not void for that reason. Hence, the Idaho judgment was the first decision on the ownership issue as between Gladys and appellants and must be given full faith and credit by this court. We do not agree.

If the Idaho trial court had given full faith and credit to the prior Arizona judgments or recognized that the hotel was not community property it could not have entertained appellants’ intervention action. Ordinarily, rights to real property can be litigated in a divorce proceeding as an incident to the dissolution of the marriage and third persons claiming an interest in the property may intervene. Potter v. Potter, 35 Wash.2d 788, 215 P. 2d 704; Brust v. Brust, 181 Or. 307, 181 P.2d 632; Wharff v. Wharff, 244 Iowa 496, 56 N.W.2d 1; Anno.: 102 A.L.R. 814. However, the hotel property was not involved in the Idaho divorce proceeding because any interest which the parties previously held as community property had become the separate property of Gladys. Rules 14 and 24 of the Idaho Rules of Civil Procedure deal with third party practice and intervention actions. Rule 14 allows either party to bring in others which was not the case here. Rule 24(a) allows intervention by right where, among other things, “the applicant is so situated as to be adversely affected by a distribution or other disposition of property which is in the custody or subject to the control or disposition of the court or an officer thereof.” This rule is also inapplicable. The appellants who intervened in the Idaho divorce suit would not have been affected by a distribution of property because the court could only distribute community property. The hotel, in which appellants claimed an interest, was Gladys’ separate property. Rule 24(b) allows permissive intervention where there is a common question of law or fact involved in the main suit and the intervenor’s suit. The ownership of the Arizona Hotel was not at issue in the Idaho suit between Arnold and Gladys and that was the only issue appellants interjected into the intervention suit. It follows that there was no common question of law or fact. The Idaho trial court had no power or authority to entertain the intervention action and we need not give full faith and credit to its judgment. Estin v. Estin, supra.

Appellants further contend that Gladys consented to the jurisdiction of the Idaho court. It is irrelevant that Gladys and appellants may have litigated the ownership of the hotel in the Idaho court because “it is a universal rule of law that parties cannot, by consent, give a court jurisdiction of a subject matter of which it would not otherwise have jurisdiction, and a judgment rendered in such a case is not validated by the consent.” Application of Duke H. Martin, 76 Idaho 179, 279 P.2d 873, 53 A.L.R.2d 582; 30A Am. Jur., Judgments, § 27. It is true that Gladys filed an answer to the Idaho divorce complaint on July 10, 1959, alleging that the Arizona Hotel was community property which it was at that time although burdened with her lien for support payments. However, two weeks later the execution and sale took place and the hotel was no longer community property and became her separate property by reason of the sheriff’s sale which fact must have been brought to the attention of the Idaho court.

There is a further reason why the Idaho judgment is not entitled to full faith and credit. Idaho had no power or authority and was completely without jurisdiction to establish or quiet or otherwise directly affect title to the Arizona Hotel property. Durfee v. Duke, 375 U.S. 106, 84 S.Ct. 242, 11 L.Ed.2d 186; Fall v. Eastin, 215 U.S. 1, 30 S.Ct. 3, 54 L.Ed. 65. Idaho has recognized this principle. Taylor v. Hulett, 15 Idaho 265, 97 P. 37, 19 L.R.A.,N.S., 535. It is clear that the Idaho trial court attempted to directly decide ownership and title of the Arizona Hotel. In its findings of fact it said:

“IX

“This court finds that the Arizona Hotel, * * * is owned by the Continental Hotels System, a co-partnership, * * * »

In its judgment and decree it said:

“It is further ORDERED, ADJUDGED AND DECREED that ' the Continental Hotels System, a co-partnership, * * * is the owner of the following described real and personal properties, to wit: (The Arizona Hotel)”

Pursuant to the finding and judgment, Gladys was ordered to execute within ten days the aforementioned quitclaim deeds and assignments of her interest in the hotel and if she failed to do so, “the clerk of this (Idaho) court is hereby empowered to execute and deliver such conveyance as are (sic) necessary to carry into force and effect said judgment.”

Appellants argue that the Idaho court simply determined the rights and equities in the hotel property of the parties before it. They cite Kennedy v. Morrow, 77 Ariz. 152, 268 P.2d 326 and Butterfield v. The Nogales Copper Co., 9 Ariz. 212, 80 P. 345 for the principle that an equity court’s decrees based upon in personam jurisdiction are valid though they concern or affect land out of the state. We have no quarrel with those decisions, but they are inapplicable to this case for several reasons. It is true that the Idaho court had jurisdiction over the parties and the subject matter of the divorce but it had no jurisdiction to order Gladys to convey her separate property. Heslip v. Heslip, supra. We have said:

“ ‘ * * * The court must have (a) jurisdiction of the subject matter of the case, (b) jurisdiction of the persons involved in the litigation, and (c) jurisdiction to render the particular judgment given. * * *

* * * * *

- ■ “While this court has held that a divorce action is an action in equity, (citation omitted), yet the trial court may not assume a jurisdiction not given it by- statute because divorce is primarily a statutory action and equity is invoked in aid of the execution of the statute. Section 27-808, A.C.A.1939, supra, does not include the wife’s right to demand an inventory of the husband’s separate property. Such authority not expressly given by statute cannot thus be assumed.” Van Ness v. Superior Court, 69 Ariz. 362, 364, 365, 213 P.2d 899, 900.

Divorce actions where the court undertakes to divide community property both in and out of the forum must be carefully distinguished. We reemphasize the fact that at the sheriff’s sale Gladys acquired as her separate property whatever interest Arnold had in the hotel to satisfy her judgment. Likewise, it is important to distinguish cases where, for example, one party sues another for breach of a contract to convey- land situated in another state. Here, the appellants’ action in Idaho was in the nature of a suit to quiet title to the Arizona Hotel and the court undertook to directly adjudicate title thereto. That conclusion becomes apparent when we ask the following question: would the. Idaho court have ordered Gladys to execute the quitclaim deed if it had not first decided that the hotel was owned by a partnership or that it was community property? Obviously not. It determined in the divorce decree who had title to the property and thereafter ordered the parties to execute all conveyances necessary to carry out its judgment and decree.

Additional evidence that the Idaho court did not merely determine the rights of the parties before it is the fact that the partnership in which ownership of the hotel was found to be lodged was not a party before the court. Furthermore, the Uniform Partnership Act is in effect in Idaho so that a partnership can sue or be sued in its own name. Idaho Code, § 53-301 et seq., § 5-323. The Continental Hotels Systems partnership was not a party to the Idaho suit. Therefore the court was not merely adjudicating the rights of parties before it when it decided that the partnership owned the Arizona Hotel. That part of the Idaho judgment is void. Durfee v. Duke, supra; Fall v. Eastin, supra; Taylor v. Hulett, supra.

We must next consider the documentary evidence submitted by appellants at the trial below to determine whether they made out a prima facie case that the Arizona Hotel was owned by a partnership which would require that Gladys’ motion for a directed verdict be denied. Figueroa v. Majors, 85 Ariz. 345, 338 P.2d 803. The evidence shows that on July 30, 1943 Gladys and Arnold, as husband and wife, acquired a warranty deed to the Arizona Hotel which was recorded August 13, 1943 creating a presumption of community property. There was an agreement dated September 21, 1943 which stated that Gladys and Arnold owned one-half interest in the hotel and R. E. Spaulding and his wife owned the ■ other one-half interest. The Spauldings conveyed their alleged interest to Arnold and Gladys by warranty deed dated June 30, 1948 and they were again presumed to own all of the Arizona Hotel as community property. There is a mortgage dated August 14, 1958 which recites that Gladys and Arnold own the hotel as husband and wife. There is a lease dated April 1, 1949 between Arnold Porter as lessor and a tenant of the hotel as lessee. There is a partnership agreement dated January 1, 1943 — seven months before Gladys and Arnold acquired title to the hotel — between Gladys and Arnold, Andrew Rickett and his wife, and appellants Pearline Porter and Pauline Leonard. The agreement makes no reference to the Arizona Hotel. There is a lease dated February 21, 1956 between Arnold, Gladys, Pear-line Porter and Pauline Leonard as co-partners and lessors and a corporation as lessee to a portion of the Arizona Hotel. This was the only document admitted in evidence which suggests that the Arizona Hotel is owned by a partnership. The trial court concluded that this document, being unexplained, fell short of the “nearly conclusive” evidence required to overcome the presumption created by the warranty deeds of July 30, 1943 and June 30, 1948 that the hotel was the community property of Gladys and Arnold. Kennedy v. Kennedy, supra. Considering the entire record in the case, we will not disturb this finding. The other documents in evidence depended for their validity upon the trial court giving full faith and credit to the Idaho judgment. Since we have decided otherwise, the quitclaim deed, assignment and release of judgment were of no effect. Garren v. Rollis, 85 Idaho 86, 375 P.2d 994; 49 C.J.S. Judgments § 449.

Appellant Kemble concedes that “The crux of this case is the validity of the Idaho decree of divorce.” In view of this decision denying full faith and credit to the Idaho judgment, and our affirmance of the trial court’s directed verdict, the other assignments of error raised by appellants are moot. We have, however, considered them and find them to be without merit.

The opinion of the court of appeals is vacated and the judgment of the trial court is affirmed.

STRUCKMEYER, C. J., and LOCKWOOD, J., concur.