Opinion
No. 38567-8-II.
January 12, 2010.
Appeal from a judgment of the Superior Court for Mason County, No. 07-3-00199-6, Toni A. Sheldon, J., entered October 15, 2008.
Affirmed by unpublished opinion per Houghton, J., concurred in by Van Deren, C.J., and Quinn-Brintnall, J.
Amber Heath (formerly Chuck Heath) appeals the trial court's property distribution award from her marriage dissolution proceeding, arguing trial court error. We affirm.
FACTS
Amber and Michelle Heath married in 1998 and separated in 2006. In 2007, Amber filed a petition to dissolve their marriage. After a trial, the court entered findings of fact and conclusions of law and signed the dissolution decree.
We use the parties' first names for clarity, intending no disrespect.
Michelle owned separate property acquired before the marriage, including a home on East Grove Lane in Shelton and a home in Fredonia, Arizona. The trial court awarded both of these properties to her as her separate property. In 2004, Michelle received a personal injury settlement, which the trial court awarded to her as her separate property. The trial court also entered a $24,230.42 lien payable to Michelle for her separate property interest in the community Harstene Island home.
The trial court awarded Michelle the following community property: a Plymouth Breeze automobile, a fifth wheel trailer, and a one-half interest in the Harstene Island home. The trial court awarded Amber the following community property: a Toyota Tacoma pickup truck, a sailboat, and a one-half interest in the Harstene Island home. The trial court made other miscellaneous awards to the parties, such as household items, personal effects, and debts.
The Harstene Island home is the source of the dispute here. After separation, the parties secured a $60,000 home equity line of credit against the home. The parties acquired the line of credit to pay community debts and to purchase a trailer for Michelle, both of which occurred. Amber failed to pay property taxes, utility bills, and homeowner association dues, however. And contrary to the parties' agreement, Amber used the line of credit for her own living expenses after placing $55,000 in her personal account. Because the line of credit encumbered the home, the trial court ordered that the parties sell the home and use the proceeds to pay off the line of credit and Michelle's separate property interest.
The trial court imposed a $16,198 judgment against Amber because she used the line of credit for personal, post-separation expenses. The trial court calculated this by taking the $55,000 figure that Amber deposited in her bank account from the credit line and subtracted approximately $22,604 in community debts paid from the total. The $16,198 represents approximately the amount of equity Michelle would have received had the house been sold without the extra debt Amber accumulated. Further, the trial court found that Amber secured the line of credit through fraud and misrepresentation, and that the judgment would therefore be non-dischargeable in bankruptcy. Amber appeals.
ANALYSIS Property Distribution
Amber first contends that the trial court did not make a "just and equitable" distribution of the Harstene Island property when it issued a $16,198 judgment against her. Appellant's Br. at 1. She asserts that the trial court should have classified the trailer she purchased for Michelle with the community line of credit as Michelle's separate debt and by failing to do so, divided the property in an "unjust manner." Appellant's Br. at 1.
The trial court must make a "just and equitable" property distribution in view of a number of nonexclusive factors, including the nature and extent of the property, the duration of the marriage, and the economic situation of each spouse at the time of dissolution. RCW 26.09.080. "An equitable division of property does not require mathematical precision, but rather fairness, based upon a consideration of all the circumstances of the marriage, both past and present, and an evaluation of the future needs of parties." In the Matter of the Marriage of Crosetto, 82 Wn. App. 545, 556, 918 P.2d 954 (1996). A "just and equitable" property distribution is not necessarily an equal one. In the Matter of the Marriage of Tower, 55 Wn. App. 697, 700, 780 P.2d 863 (1989).
We review the trial court's property distribution only for an abuse of discretion. In the Matter of the Marriage of Brewer, 137 Wn.2d 756, 769, 976 P.2d 102 (1999). A trial court abuses its discretion when it bases its decision on unreasonable or untenable grounds. Tower, 55 Wn. App. at 700.
The trial court considered all of the parties' property, the duration of the marriage, and the economic situation of each spouse in its award. The trial court entered the $16,198 judgment because Amber used the community line of credit for personal, post-separation expenses, contrary to the parties' agreement, and because the equity from the sale of the Harstene Island home will go to repay those separate expenses. Such post-separation expenses are the separate obligations of the parties. RCW 26.16.140. Overall, the trial court's property award was equitable, with roughly a 50 percent community property award to each spouse before the judgments. The trial court acted within its discretion in treating the trailer as a community asset and awarding it to Michelle. Amber fails to demonstrate how the trial court abused its discretion and her argument fails.
Fraudulent Use of the Line of Credit
Next, Amber contends that the trial court's finding of fraud and misrepresentation as to her acquisition and use of the community home equity line of credit was improper. She asserts that the trial court failed to make a finding on each of the nine elements of fraud.
In finding fraud as to the line of credit, the trial court was primarily concerned that Amber would file for bankruptcy to avoid paying the judgment against her. Debts incurred through fraud are non-dischargeable in bankruptcy. See 11 U.S.C. § 523(a)(2)(A).
To establish fraud, a litigant must show:
(1) representation of an existing fact, (2) materiality of the fact, (3) falsity of the fact, (4) the speaker's knowledge of the falsity of the fact, (5) the speaker's intent that the fact should be acted on by the person to whom the fact was represented, (6) ignorance of the fact's falsity on the part of the person to whom it is represented, (7) reliance on the truth of the factual representation, (8) the right of the person to rely on the factual representation, and (9) the person's consequent damage from the false factual representation.
In the Matter of the Marriage of Angelo, 142 Wn. App. 622, 643, 175 P.3d 1096, review denied, 164 Wn.2d 1017 (2008).
We review questions of law and conclusions of law de novo. Sunnyside Valley Irrigation Dist. v. Dickie, 149 Wn.2d 873, 880, 73 P.3d 369 (2003). Generally, we may uphold the trial court's ruling on any basis the record supports. Burnet v. Spokane Ambulance, 131 Wn.2d 484, 493, 933 P.2d 1036 (1997). Clear, cogent, and convincing evidence must support the trial court's finding of fraud. Williams v. Joslin, 65 Wn.2d 696, 697, 399 P.2d 308 (1965).
The trial court's oral ruling provides a sufficient basis to support the trial court's finding of fraud as to the line of credit. To summarize, (1) Amber sought a higher amount from the line of credit than the parties originally agreed to and misrepresented this fact to Michelle; (2) this was material because it served to further encumber the community home; (3) Amber used the line of credit in an amount and for expenses outside the scope of the line of credit's purpose; (4) Amber knew the amount of credit procured exceeded her agreement with Michelle and she transferred money from the line of credit for personal use; (5) Amber intended for Michelle to approve the line of credit; (6) Michelle had no idea that Amber used the line of credit for other personal expenses; (7) Michelle relied on Amber's claims and, therefore, did not take steps to protect her community and separate property interests in the home; (8) Michelle had the right to rely on Amber's factual representation regarding their community home; and (9) Michelle's community property interest in the home was effectively reduced because the equity must be used to cover costs associated with the line of credit. Thus, Amber's argument fails.
Affirmed.
A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record pursuant to RCW 2.06.040, it is so ordered.
QUINN-BRINTNALL, J. and VAN DEREN, C.J., concur.