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Hatcher v. Hatcher8/29/1996
THOMPSON, Judge
Appellant Julia M. Hatcher (wife) seeks review of a dissolution decree awarding jointly-held real property to Appellee Marvin L. Hatcher (husband). Wife contends that the trial court erred in finding that the proceeds from a disability insurance settlement awarded to husband, and the family residence and an apartment complex purchased with the insurance proceeds and held in joint tenancy, were husband's separate property. We agree that the insurance proceeds were, in part, community property, and reverse.
FACTS AND PROCEDURAL HISTORY
The parties were married in Arizona on December 6, 1980. They had four children during the marriage. Husband worked for Ralston Purina Company, and voluntarily agreed to participate in an insurance program offered by his employer in April 1982. The "Voluntary Personal Accident Plan" (VPA) provided for benefits to the employee's family or to the employee in the event of accidental death, dismemberment or disability. Husband initially designated his wife and son as beneficiaries of the insurance policy, subsequently amending the policy to include coverage for his three after-born children. Premiums for the VPA program were automatically deducted from husband's paycheck.
In November 1984, husband suffered the loss of his right hand and the partial loss of his right arm in a work-related accident. Husband missed work for three months because of his injuries. During this time, husband received a small worker's compensation award which went toward household expenses. Under the VPA policy, he received a lump sum settlement of $120,000 and monthly structured payments for a period of fifty-four months.
A portion of the VPA proceeds was placed in a joint account which the husband and wife maintained at a local credit union, and later used as a down payment on the purchase of the family residence in Flagstaff, Arizona. The parties subsequently used payments from the monthly structured disability settlement to pay the remaining balance owed on the house. Title to the residence was taken by husband and wife as joint tenants with right of survivorship.
The parties also used some of the insurance settlement proceeds to construct an apartment complex on a parcel of land owned by husband prior to marriage. Two different lenders provided construction and permanent financing for the apartments. Both husband and wife signed the promissory note and held title to the property as joint tenants with right of survivorship. The rental income produced by the apartments fully satisfied each month's mortgage payments owed on the property.
Wife filed for divorce in February 1991. At trial, the court found that the insurance settlement proceeds were husband's separate property. The court held that, although the residence and apartment complex were held in joint tenancy, husband had "shown by clear and convincing evidence that it was not his intent to make a gift of the real property to the community." The court therefore ordered that the real property was the separate property of husband. Wife appeals from these determinations.
Discussion
On appeal, wife argues that the VPA insurance proceeds constituted community property because the premiums were paid with community funds and because the settlement monies were received during the course of the parties' marriage. Alternatively, wife contends that even if the insurance proceeds were in fact husband's separate property, he failed to rebut the presumption created by the joint tenancy deeds for the residence and apartment complex that husband intended to make a gift of these properties to her.
We view all the evidence
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