Wilson v. Wilson
2016 Ark. App. 256
| Ark. Ct. App. | 2016Background
- John and Vickie Wilson married in October 2010 and separated in March 2014; Vickie filed for divorce.
- Before marriage, John owned various oil-and-gas investments; Vickie owned a premarital business (Dynamic Energy Concepts, Inc.) and worked full time.
- Just before the marriage the parties discussed investing through a corporation, Rain Water Energy; Vickie gave John $2,800 by check marked “Reeves/Rainwater.”
- John purchased an 8% interest in the Reeves County Saltwater Disposal Well (Reeves) in his name prior to the marriage and made additional contributions from his Texas account.
- The trial court treated the Reeves interest as marital property and divided multiple business interests, retirement contributions, household items, and debt reductions between the parties.
- On appeal, John challenged the characterization of Reeves and the overall equitable division; Vickie cross-appealed claiming a 50% nonmarital interest in Reeves.
Issues
| Issue | Wilson (John) Argument | Wilson (Vickie) Argument | Held |
|---|---|---|---|
| Whether Reeves interest is marital property | Reeves was nonmarital because John purchased it before marriage in his name | Reeves not marital but Vickie argued she had a 50% nonmarital interest based on joint intent and her $2,800 payment | Reeves is nonmarital property of John; trial court erred treating it as marital; Vickie failed to prove a 50% nonmarital interest |
| Whether trial court’s overall property division was equitable | Division was inequitable; some assets John received should have been deemed his nonmarital property and returned | Trial court’s division supported by its findings (trial court had awarded many business interests to John and house to Vickie) | Remanded: trial court must specify marital vs nonmarital characterization and state reasons for unequal divisions when applicable |
| Whether John is entitled to $200,000 offset for marital funds that reduced debt on Vickie’s nonmarital residence | John argued he should receive offset to account for marital contribution to reduce debt on Vickie’s premarital property | Vickie obtained benefit of principal reductions as awarded; court treated reductions as her sole and separate property | Guidance only: remand may raise this again; reduction in debt is not itself marital property—court must consider marital contributions in balancing equities |
| Whether John is entitled to gains/losses on Vickie’s 401(k) contributions during marriage | John argued he should get associated gains/losses in addition to half of contributions | Trial court awarded John half of contributions but not explicitly gains/losses | Reversed and remanded: associated gain/loss on marital contributions is marital property and must be equally divided or court must state basis for unequal division |
Key Cases Cited
- Fell v. Fell, 473 S.W.3d 578 (Ark. Ct. App. 2015) (purchase before marriage in sole name not converted to marital property by later intent)
- Baker v. Baker, 429 S.W.3d 389 (Ark. Ct. App. 2013) (use of plural pronouns about nonmarital property does not effect a gift)
- Ransom v. Ransom, 309 S.W.3d 204 (Ark. Ct. App. 2009) (trial court’s broad power to distribute marital and nonmarital property equitably)
- Jones v. Jones, 432 S.W.3d 36 (Ark. 2014) (nonowning spouse entitled to consideration when marital funds reduce debt on other spouse’s nonmarital property)
- Powell v. Powell, 110 S.W.3d 290 (Ark. Ct. App. 2003) (debt reduction on nonmarital property is not automatically marital property; need fair-market-value evidence to show increase in value)
- Thomas v. Thomas, 4 S.W.3d 517 (Ark. Ct. App. 1999) (associated gain or loss on marital retirement contributions is marital property)