Opinion
2 CA-CV 2022-0084
09-13-2022
In re the Conservatorship of Carol Jean Hernandez, an adult, Tiffaney Knight, Petitioner/Appellee, v. Carol Jean Hernandez, Respondent/Appellant.
Lundberg & Elias PLLC, Bullhead City By T'shura-Ann Elias Counsel for Petitioner/Appellee Heather C. Wellborn P.C., Lake Havasu City By Heather C. Wellborn Counsel for Respondent/Appellant
Not for Publication - Rule 111(c), Rules of the Arizona Supreme Court
Appeal from the Superior Court in Mohave County No. GC202004048 The Honorable Steven C. Moss, Judge
Lundberg & Elias PLLC, Bullhead City
By T'shura-Ann Elias
Counsel for Petitioner/Appellee
Heather C. Wellborn P.C., Lake Havasu City
By Heather C. Wellborn
Counsel for Respondent/Appellant
Chief Judge Vásquez authored the decision of the Court, in which Presiding Judge Eckerstrom and Judge Cattani concurred.
MEMORANDUM DECISION
VÁSQUEZ, Chief Judge:
¶1 In this action for declaratory relief, Carol Hernandez challenges the trial court's judgment awarding her deceased husband Manuel Hernandez's interest in their marital residence to their granddaughter, Tiffaney Knight. Carol argues the court erred in finding Manuel had converted ownership of the property from community property with right of survivorship to tenancy in common by signing a warranty deed conveying the property to him and Carol as tenants in common. Carol further argues the court erred by rejecting her claim that Manuel's transfer of his interest in the property by means of a beneficiary deed to Knight was not valid without Carol's consent. For the following reasons, we affirm.
Factual and Procedural Background
¶2 We view the facts in the light most favorable to upholding the trial court's judgment. Harris v. City of Bisbee, 219 Ariz. 36, ¶ 3 (App. 2008). In 2003, Carol and Manuel purchased their marital residence in Fort Mohave, holding title as community property with right of survivorship. On September 9, 2020, Manuel executed a will in which he named Knight as his sole heir and personal representative. On the same day, he also executed a warranty deed that conveyed the marital residence to him and Carol as tenants-in-common and a beneficiary deed that conveyed his interest in the marital residence to Knight upon his death. Both deeds were recorded in the office of the Mohave County Recorder.
¶3 In December 2020, Manuel died and Knight was appointed as Carol's guardian and conservator on an emergency temporary basis. In January 2021, Carol filed an emergency motion to remove Knight as temporary guardian and conservator and to appoint another temporary statutory representative. That same month, Knight filed a petition to be discharged of her duties as temporary guardian and conservator. In February 2021, both parties agreed to the Mohave Estate Management Office ("MEMO") being appointed as Carol's temporary guardian and conservator.
¶4 In May 2021, after MEMO submitted its petition for approval of its conservatorship estate inventory and budget, Carol filed an objection, arguing that Manuel's interest in the marital residence should have transferred to her upon his death, and that even if the beneficiary deed was valid, Knight should only receive a quarter interest in the marital residence.
¶5 In July 2021, Carol and Knight both filed petitions for declaratory judgment. Knight argued that Manuel had "intended to sever the community property with right of survivorship interest he held with Carol" when he executed the warranty deed, converting their interests to tenants in common and that he had intended to leave his one-half interest to Knight by executing the beneficiary deed. Carol contended that the warranty and beneficiary deeds were void, leaving the right of survivorship intact and denying Knight any interest in the marital residence.
¶6 In August 2021, after an evidentiary hearing, the trial court found Manuel had intended to sever the joint tenancy when he executed the warranty deed and awarded Knight one-half of the marital residence's sale proceeds. After a final judgment was entered, this appeal followed. We have jurisdiction pursuant to A.R.S. §§ 12-120.21(A)(1) and 12-2101(A)(1).
Discussion
¶7 Carol argues the trial court erred by awarding one-half of the proceeds from the sale of the marital residence to Knight because the warranty deed executed by Manuel did not sever the right of survivorship. She contends the warranty deed was invalid because it failed to comply with A.R.S. § 33-431(D) and lacked her consent. She further maintains the beneficiary deed was also invalid because she had not given her consent as required under A.R.S. § 33-405(D).
¶8 The interpretation of a statute and real property deeds is a question of law we review de novo. Paulden Indus. LLC v. Big Chino Materials LLC, 249 Ariz. 442, ¶ 9 (App. 2020) (deed interpretation); Bekelian v. JP Morgan Chase Bank NA, 246 Ariz. 352, ¶ 6 (App. 2019) (statutory interpretation). We apply statutes as written if they are unambiguous. State v. Rios, 252 Ariz. 316, ¶ 19 (App. 2021). But when "the statute is subject to more than one reasonable interpretation, we consider secondary principles of statutory interpretation, such as the context of the statute, the language used, the subject matter, its historical background, its effects and consequences, and its spirit and purpose." Id. (quoting State v. Jurden, 239 Ariz. 526, ¶ 15 (2016)). Section 33-431(D) states:
In the case of real property owned by a husband and wife as community property with right of survivorship, the right of survivorship is extinguished as provided in § 14-2804 or on the recordation in the office of the recorder of the county or counties where the real property is located an affidavit entitled "affidavit terminating right of survivorship" executed by either spouse under oath that sets forth a stated intent by the spouse to terminate the survivorship right, a description of the instrument by which the right of survivorship was created including the date the instrument was recorded and the county recorder's book and page or instrument reference number and the legal description of the real property affected by the affidavit. The recordation shall not extinguish the community interest of either spouse.
¶9Carol argues that because Manuel did not execute an "affidavit terminating right of survivorship," his use of a warranty deed to sever the right of survivorship was ineffective. She maintains the statute mandates strict compliance because of the "specificity set forth in the statute as to the nature of the affidavit required to terminate the right of survivorship and the fact the community property with right of survivorship is a statutory creation." Although the trial court found Manuel had not complied with § 33-431(D), it rejected Carol's argument that the statute was the only way to sever a right of survivorship. Instead, it noted "there's nothing within [§ 33-431] that states it's the exclusive method" and right of survivorship can also be severed by executing a deed that is inconsistent with the right of survivorship under Lonergan v. Strom, 145 Ariz. 195 (App. 1985). We agree. Nothing in the plain language of § 33-431(D) states that it is the exclusive method for terminating a right of survivorship with regard to community held real estate and we will not read such additional language into the statute. See City of Phoenix v. Donofrio, 99 Ariz. 130, 133 (1965) (asserting that "courts will not read into a statute something which is not within the manifest intention of the legislature as gathered from the statute itself" and "will not inflate, expand, stretch or extend a statute to matters not falling within its expressed provisions").
¶10 We also disagree with Carol's argument that the warranty deed is invalid because "one spouse's attempt to convey an interest in community property without the written agreement or consent of the other spouse is null and void." As support, she cites A.R.S. § 33-452, which requires a "conveyance or incumbrance of community property" to be "executed and acknowledged by both husband and wife," and A.R.S. § 25-214(C)(1), which requires "joinder of both spouses" for any "transaction for the acquisition, disposition or encumbrance of an interest in real property." But in Lonergan, we recognized "[i]t is generally the case that either party to a joint tenancy may terminate it by conveyance or other disposition of his interest, and the consent of the other tenants is not required." 145 Ariz. at 198; see also Register v. Coleman, 130 Ariz. 9, 12 (1981) (joint tenancy destroyed when party quitclaimed interest); In re Estelle's Estate, 122 Ariz. 109, 111 (1979) (stating that "[j]oint tenancy requires the presence of the four unities: time, title, possession, and interest," and "[severance or destruction of one or more of these unities results in a destruction of the joint tenancy and the failure of the right of survivorship").
¶11 Although these decisions predate § 33-431(D), which was enacted in 1995, "absent a manifestation of legislative intent to repeal a common law rule, we will construe statutes as consistent with the common law." Carrow Co. v. Lusby, 167 Ariz. 18, 21 (1990); see also Tucson Gas & Elec. Co. v. Schantz, 5 Ariz.App. 511, 515 (1967) ("Where a right exists at common law . . . and a statute is enacted likewise providing a remedy, such statutory remedy is merely cumulative to the common law remedy unless it explicitly provides that it shall be exclusive."). Moreover, § 33-431(D), does not require approval from both spouses to extinguish survivorship rights. It provides that "either spouse" may terminate the right. Id.
¶12 Carol nevertheless maintains § 33-431 (D)'s specificity in describing the affidavit and "the fact the community property with right of survivorship is a statutory creation" requires strict adherence to the statute. We disagree. Courts will not impose consequences for noncompliance with statutes when the legislature has not done so. See, e.g., Ariz. Dep't of Econ. Sec. v. Lee, 228 Ariz. 150, ¶¶ 16-19 (App. 2011) (declining to read statutory time-limit as mandatory because legislature did not provide any consequence for untimely compliance); McCurry v. Indus. Comm'n, 228 Ariz. 1, ¶ 9 (App. 2011) (declining to set aside untimely decisions in Industrial Commission cases because legislature "did not provide a statutory remedy or consequence, and we decline to do so here"). Furthermore, there is nothing in § 33-431(D)'s legislative history to suggest the legislature intended to make it the exclusive method for severance of a marital joint tenancy with right of survivorship.
The available legislative history suggests community property with right of survivorship was created to provide tax benefits for surviving spouses. See S. Judiciary Comm. Minutes, 42nd Leg., 1st Reg. Sess. (Ariz. March 21, 1995).
¶13 Therefore, we cannot say that the legislature intended § 33-431(D) to be the exclusive means by which community property with right of survivorship can be severed and that existing common law methods for severing a joint tenancy no longer apply. Thus, the trial court did not err in finding Manuel's warranty deed terminated the right of survivorship, transforming his and Carol's interest into a tenancy-in-common.
¶14 Lastly, Carol similarly argues Manuel's beneficiary deed is invalid under § 33-405(D) because she did not approve it. However, § 33-405(D) only applies to joint tenancies with right of survivorship or community property with right of survivorship when complete ownership is being transferred to a beneficiary. The beneficiary deed Manuel executed only conveyed his interest in the residence, it did not purport to also convey Carol's one-half interest in the property. He therefore did not need Carol to approve the beneficiary deed. Ultimately, the trial court did not err in awarding Knight a one-half interest in the sale proceeds of the marital residence because the right of survivorship had been severed by Manuel's warranty deed and his interest was properly conveyed to Knight by the beneficiary deed.
Attorney Fees and Costs
¶15 Both parties request their costs and attorney fees on appeal. In our discretion, we deny both requests for attorney fees but, as the successful party, we award Knight her costs incurred on appeal, upon her compliance with Rule 21, Ariz. R. Civ. App. P. See A.R.S. § 12-341.
Disposition
¶16 For the reasons stated above, we affirm.