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Abood v. Abood9/2/2005
No. 5937
Before: Bryner, Chief Justice, Matthews, Eastaugh, Fabe, and Carpeneti, Justices.
MATTHEWS, Justice, with whom FABE, Justice, joins, concurring.
I. INTRODUCTION
Patrick and Kimberly Abood both appeal aspects of the property division accompanying their divorce. We affirm. We conclude that the superior court did not clearly err in finding that settlement proceeds paid to Kimberly during the marriage for personal injuries she received about five years before the marriage were not transmuted into marital property. We also conclude that the superior court did not clearly err in finding that the marital home was transmuted into marital property even though Kimberly was not on the title and Patrick had purchased the home before they married. We conclude that the superior court did not clearly err in finding that the $174,814 increase in value of Patrick's street sweeping business was marital because it was the result of active appreciation. We conclude that the superior court did not abuse its discretion in assigning a recapture value of a marital vehicle Kimberly sold before trial, or by not dividing the value of a set of tires and rims from that vehicle. We also conclude that the court did not abuse its discretion in characterizing the 2001 federal income tax refund as Patrick's separate property.
II. FACTS AND PROCEEDINGS
Kimberly and Patrick married in 1994. They neither had nor adopted children. Kimberly and Patrick separated, and Patrick petitioned for divorce in 2002. At the time of trial, Kimberly was forty years old and one semester away from earning her second master's degree. Patrick was forty-six and owned and operated a successful street-sweeping business, Knik Sweeping. The superior court granted the divorce and distributed the property. Patrick and Kimberly both appeal aspects of the property division.
One dispute concerns personal injury settlement proceeds Kimberly received during the marriage to compensate her for injuries she received before the marriage. Kimberly had been the victim of a 1989 vehicular accident in which she sustained serious injuries that continue to plague her and may require further surgery. She sued General Motors for her injuries and settled with GM in 1999, receiving net proceeds of $1.6 million. This money was deposited into Patrick's business and personal checking account. Two months later the parties placed the $1.6 million, along with another $300,000 in marital funds, in five Merrill Lynch joint Cash Management Accounts (CMAs) with rights of survivorship. The superior court found that the proceeds from the settlement remained Kimberly's separate property, but that the $300,000 contribution was marital.
Another dispute concerns the superior court's characterization of the home as marital property. In 1993 Patrick bought the house that the couple shared before and during the marriage. Several improvements were made to the house before and during the marriage. The parties stipulated to its value but disputed whether it should be categorized as marital or as Patrick's separate property. The superior court found that the house had been transmuted into marital property.
The parties dispute the division of Patrick's business, Knik Sweeping. At the time of trial, Patrick operated Knik Sweeping as a sole proprietorship and used the business checking account as his all-purpose business and personal account. Patrick purchased equipment during the marriage with funds from that checking account. The superior court found that the equipment acquired during the marriage was marital property and, alternatively, that the business's increase in value was ma
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