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A Claim of Waste in an Arizona Divorce for the Loss of Equity in a Home | Voted “Best of the Valley”

Posted on : May 7, 2018, By:  Christopher Hildebrand
A Claim of Waste in an Arizona Divorce for the Loss of Equity in a Home.

A Claim of Waste in an Arizona Divorce for the Loss of Equity in a Home

The Short Answer

The short answer to the question can there be waste of the equity in a marital home in Arizona is, yes, the court will recognize a claim of waste of the equity in a home during a divorce in Arizona; either because a spouse did not take care of the home or intentionally losing equity in the home due to a foreclosure that could have been avoided by making the house payments. To learn more, read on about the Arizona Court of Appeals decision in the case of Woehler vs. Stough.

The Long Answer

The Arizona Court of Appeals in the case of Woehler vs. Stough had to address whether a spouse in a divorce case in Arizona can

A Claim of Waste in an Arizona Divorce for the Loss of Equity in a Home.

A Claim of Waste in an Arizona Divorce for the Loss of Equity in a Home.

be awarded a larger share of the proceeds from the sale of a home based upon the theory that the equity in the home was reduced because of the wasteful conduct of the other spouse. Mr. Woehler (“Husband”) and Ms. Stough(“Wife”) were married in 1992 and acquired their marital residence approximately eleven years later in 2003. The term “acquired” is used because the residence was transferred to them by a deceased friend and the deed remained in the deceased friend’s name throughout the twelve years of Husband and Wife’s marriage. In July 2015, both parties filed for dissolution. In October 2015, at a resolution management conference, Wife was given 60 days exclusive use of the marital residence at which time the residence would be prepared for sale. It was during this time in December 2015 that Wife requested that a Special Real Estate Master (“Special Master”) be appointed to sell the residence. The reasons were given for requesting a Special Master were that the deed was still in the deceased friend’s name and Husband had not recorded the deed and even denied possessing it.

 

Wife asserted that these conditions would make the residence harder to be sold. The request for the Special Master was originally denied by the court, but one was appointed in March 2016 and the court also ordered Husband to record the deed no later than March 29 of that year. Husband recorded the deed April 14 of that year. Just three months later, on July 26, 2016, the residence was sold at a trustee’s sale for $360,000, with $153,000 remaining after satisfying the mortgage. The case for dissolution and the case for the sale of the property were consolidated.

Jennifer, thank you for being my attorney. I could not have been more pleased with the outcome of my family court hearing. Everything you have done for me throughout this case reflects in the final ruling of the judge. You helped me keep my head together and taught me a lot about myself as a person. I learned so much about my life from observing and listening to you. I will take all the advice you gave me to continue taking responsibility for my choices, continue to put the kids' needs first, and always stay truthful. Your diligence, dedication, and persistence in my case made what seemed impossible, possible. You are a wonderful person and an amazing attorney and I am stronger and more confident because of you.
A Google User
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20:31 20 Sep 17
I just want to again thank the Firm for working with me all that it has. I could not have done anything without everyone's assistance. You, Chris and Stacey have been and continue to provide me with compassion and hard work towards my case. Also a very special thanks to Kip for taking my case in the beginning. Also continued support from him and his dedication to providing me with his expertise in this matter.
A Google User
A Google User
21:41 07 Nov 17
After interviewing several law firms, I came across Jennifer Shick, and her firm, who I hired to represent me for my Family Court case. Jennifer has extensive knowledge of the law and is determined to bring the truth to every issue involved within the case. Throughout my case, Jennifer was prepared meticulously as well as went above and beyond all of my expectations. Even when the other party tried to differ from the truth, lie to the Judge, and turn situations around, Jennifer remained attentive and provided substantial evidence to show the judge the facts as well as the proof to support what was the best interests of my children. Additionally, Jennifer helped me endure many difficult experiences, situations and inspired me to remain positive throughout the entirety of my case. Her kindness, compassion, and professionalism helped me through very difficult times and made the process feel a thousand times lighter on my shoulders. She truly has my children and my best interest at heart and I trust her perspective as well as her honesty on each and every aspect of my case. She lessened the burden on my shoulders and even when I felt like the case was not going to go in my favor, Jennifer was open-minded and reassured me that the Judge would, in fact, see the truth, which he did and the case went in my favor. After nine months of court, everything finally came together. I cannot declare how much Jennifer has been an outstanding attorney. She addressed each and every issue with diligence, she cares about her clients and their families. Jennifer genuinely cares about her clients and her dedication to the details of the case was remarkable. Overall, I am extremely pleased with Jennifer’s services and I am truly thankful that I was so blessed to have her represent my children and me. I highly recommend Jennifer as one of the best attorneys in Arizona and if the situation ever arises, I will definitely have her represent my children and me again.
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Dear Stacey and Kip, How can I ever thank you enough for helping me through the most difficult time in my life? I couldn't put into words my heartfelt gratefulness. You both were so compassionate and professional at every given moment throughout this process with me. I thank you from the bottom of my heart. You helped me to regain my freedom.
A Google User
A Google User
16:03 22 Nov 17
I was a client of Attorney Kevin Park for the dissolution of a divorce in 2016. And since I had never had the need to hire an attorney before for any purpose, I was somewhat apprehensive of the process. But the very calm and professional demeanor of Mr. Park eased my fears. He adeptly answered all my questions and I clearly knew the process and what to expect. And the skilled manner he communicated with opposing counsel was perfect. When it came down to negotiating with my spouse’s counsel, I knew I had selected the best attorney for my situation. What I noticed and appreciated was that he was using just the right amount of pressure with opposing counsel as was necessary. If you find yourself in this situation, you will want a seasoned professional like Mr. Park on your side. I'm very grateful that he was my attorney and not the opposition!
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22:14 28 Jun 17
Chris is a smart and aggressive attorney for his clients. Chris always tries to reach a fair settlement of his cases. I’ve represented clients when Chris was the opposing counsel and while he is professional and amicable to work with, he does not back off on what he needs to do for his client
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18:16 18 Sep 17
Kevin Park of Arizona Estate Planning Attorneys was just what I needed for my divorce. He was very approachable and personable. He was quick to recognize what I needed and provided it quickly and efficiently. I hope to never need a divorce lawyer again, but if I know anyone else who does, I will definitely recommend Kevin.
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19:22 23 Aug 17
I feel that Tracey Van Wickler is certainly one of the best family lawyers around. She is logical, intelligent, and truly cares. Tracey always does what is in the clients best interest, does it well, timely and with integrity. She is good at keeping her clients informed as to what is going on and clear in her communication both written and verbally. I have recommended Tracey to other people and will continue to recommend her. I recommended Tracey to someone who was having issues with their ex-wife and his response was, “I know how good she is because I went up against her and she ate me for lunch”. This same person was so impressed with her, he even recommended her to someone else, WOW, that is impressive! I am exceptionally happy with her attention to detail, her ability to explain things in ways that are easy to understand, as well as her ability to keep everyone focused on the most important things. I would recommend Tracey to anyone who may be in need of her services.
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17:44 23 Jun 16
I retained Hildebrand Law after interview a number of firms in the valley. Working with Michael C. was incredibly easy and informative. My case progressed in such a organized and thought out way to ensure that my needs were met. Michael was incredibly proactive and was able to see far ahead into my case to steer clear of some roadblocks. I would not hesitate to recommend Michael Clancy, and Hildebrand Law in general, to anyone.
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21:20 02 Apr 18
I have worked with Hildebrand law for about 8 years. They are always ready to serve, provide guidance and give you a few options. When they provide you options they also take the time to walk you through the pros and cons of each and give you a recommendation of what is best, but will listen to you and support whatever course you choose after making and educated choice. I’d recommend them to my closest friends and feel Chris Hildebrand is now a friend to me.
Larry Flint
Larry Flint
21:53 27 Feb 18
Despite the unfortunate situation I found myself in, Chris Hildebrand @ Hildebrand Law helped me maneuver every step with professionalism, expertise, and even a sensitivity that was an added bonus.Chris and his staff helped me even when I didn't know I needed the help. In other words. . . they made sure we did not leave anything undone. And in the rare instance we needed the expertise of another professional, Chris knew exactly who to recommend.Chris also knew, because of his experience, what to anticipate down the road of litigation. That meant we were better prepared to meet the challenges head on, which lead to a more equitable and fair outcome. I appreciated that Chris did his best to meet my every need in a timely fashion, even if I had a simple question that required only a phone call or e-mail or if we needed to talk face-to-face.I highly recommend Chris Hildebrand @ Hildebrand Law, PC.
Sam Franchimone
Sam Franchimone
22:09 12 Sep 13

During the trial for dissolution in February 2017, both Husband and Wife requested attorneys’ fees and costs under A.R.S. § 25-324 as well as an unequal distribution of the proceeds from the sale of the residence with each party requesting they be given a higher percentage of the proceeds than their partner. They each felt they had valid reasons for requesting the unequal distribution. Husband requested that he be given a higher percentage of the proceeds because he claimed Wife had exclusive use of the property for 60 days and failed to maintain it, which caused the property to decrease in value. Wife requested that she be given a higher percentage of the proceeds because she claimed that Husband was in control of the mortgage information and foreclosure notices and she had no notice of the trustee’s sale until the Special Master informed her of that situation in April of 2016.

She claimed that the decreased value of the residence was because Husband had stopped making mortgage payments and thus caused the foreclosure and subsequent devaluing of the property. Husband said that Wife had a copy of the deed and could have recorded it at the beginning of the proceedings. Wife said Husband told her she had to have the “original” for recording and even though the court ordered him to record by March 29, he didn’t record it until April 14. Wife also claimed that Husband continued to delay the sale of the residence even after the recording of the deed which eventually caused the foreclosure action. Prior to the trustee’s sale, the house had been valued at between $400,000 and $485,000 according to a market analysis showing the sales of comparable homes.

The Court Finds Husband’s Actions are Waste

Waste Claim for Lost Equity in a Divorce.

Waste Claim for Lost Equity in a Divorce.

The decree of dissolution was issued in family court in March 2017. The court found that Husband’s actions of delay were intentional and had caused the foreclosure which caused the property to be sold for a lesser price. The court awarded Wife the $122,500 she had requested from the excess proceeds. The court also awarded Wife attorneys’ fees and costs (though they did not determine the amount at that time) due to the fact that Husband had acted “unreasonably” during the litigation by causing delays in multiple situations. The court directed its order as, “a final appealable order under Arizona Rule of Family Law Procedure 78(B)” which is a certificate of finality. Husband appealed the decree of dissolution in April 2017 but did not file a notice of appeal for the award to the wife of attorneys’ fees and costs, which the court ultimately awarded in the amount of $22,000 in May.

Because Husband filed an appeal in April 2017 and the family court had not determined the amount of Wife’s attorneys’ fees and costs until May 2017, the court lacked jurisdiction to deal with that portion of Husband’s appeal. Husband was actually premature in his appeal. On the matter of the court awarding Wife an unequal distribution of the excess proceeds, the court “will not disturb family court rulings absent a clear abuse of discretion”. Husband used a variety of arguments against the family court in their award of unequal distribution of the residential proceeds to Wife. Husband’s lengthiest argument claimed that the reasons for the family court award of unequal distribution did not match exactly to the wording in A.R.S. § 25-318(C). He also insisted that the factors, in this case, did not match exactly with the factors in several cases provided for comparison. For these reasons, Husband argued that the family court had abused its discretion.

Husband also argued that both parties, through neglect, had caused the decline in the property and thus its lower value. He also contended that the decision by the family court to award Wife a larger portion of the proceeds was based solely on Husband’s tardy recording of the deed and that Wife should have recorded the deed herself. He argued that the late recording of the deed did not diminish the value of the property and that the family court did not have sufficient proof that the property could have sold at a higher price. Following the trustee’s sale in 2016, the civil division under A.R.S. § 33-812, divided the excess proceeds of the sale equally between Husband and Wife. Husband argued that family court should have honored that decision. Husband’s arguments were answered.

Hildebrand Law, PC | Voted Best of Our Valley in Arizona Foothills Magazine.

Hildebrand Law, PC | Voted Best of Our Valley in Arizona Foothills Magazine.

In the separate civil division proceeding where the proceeds from the sale of the property were evenly distributed between Husband and Wife, the civil division is bound by A.R.S. § 33-812 which “requires” that the proceeds be divided equally. However, under A.R.S. § 25-318(A), the family court is required to divide community property “equitably, though not necessarily in kind”. In Husband’s argument that the wording and situations did not match in A.R.S. § 25-318(C), the court found that family court did not abuse its discretion in awarding Wife more of the proceeds, since A.R.S. § 25-318(C) takes in, “any other equitable factors that bear on the outcome of an equitable division”. Wife provided multiple reasons, to include Husband’s purposeful delay, ignoring and misleading tactics to justify an unequal division of proceeds. It was found that family court did not abuse its discretion.

Wife was awarded the requested amount of $122,500 from the excess proceeds obtained through the sale of the parties’ marital residence and $22,000 in attorneys’ fees and costs. The appellate court affirmed.

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