HYBARGER VS. HYBARGER (DIVORCE PROPERTY & ALIMONY)

Statutes cited

Key holdings

Practitioner summary

The parties did not dispute the propriety of using the Pereira apportionment formula (see Pereira v. Pereira, 103 P. 488 (Cal. 1909); Cord v. Neuhoff, 94 Nev. 21, 573 P.2d 1170 (1978)), which values the separate-property contribution plus a fair return and treats the remaining increase as community. The district court erred twice in applying it: first by using 100 percent rather than 80 percent of the $31,490 initial capital as David's separate contribution (20 percent belonged to the son), and second by failing to subtract the $50,226.45 in separate property David withdrew in 1982 to purchase the community-owned Fallon ranch from his remaining separate-property interest. The court affirmed the denial of attorney's fees, reiterating that fee awards lie within the sound discretion of the trial court (Levy v. Levy, 96 Nev. 902, 620 P.2d 860 (1980)) and that, absent statute (see NRS 123.220), separation does not dissolve the community or alter the character of income during separation (Forrest v. Forrest, 99 Nev. 602, 668 P.2d 275 (1983)).

In plain language

David and Wilma Hybarger married in 1972, each bringing substantial separate property into the marriage. David owned a drywall and painting business that, in 1976, became a partnership called Hybarger and Son Drywall, with David holding an 80 percent interest and his son Gordon holding 20 percent. When the couple divorced, the biggest dispute was how much of the value of that business belonged to the community (shared marital property) versus David's separate property. The trial court used a recognized accounting method (the "Pereira" formula) to separate David's separate-property share from the community share. Wilma appealed, raising three points: (1) the court miscalculated David's initial separate-property investment; (2) the court failed to reduce David's separate-property share by money he later pulled out of the business to buy a ranch in Fallon; and (3) the court wrongly refused to award her attorney's fees to offset money David spent after the couple separated. The Nevada Supreme Court agreed with Wilma on the first two points. On the initial investment, the court noted that only 80 percent of the $31,490 in start-up capital was David's, because 20 percent belonged to his son, so the formula had to be recalculated using the smaller figure. On the ranch, the court held that once the trial court found David withdrew over $50,000 of separate property to help buy it, it should have reduced his remaining separate-property interest in the business by that same amount. On attorney's fees, the court found no error, because whether to award fees is within the trial judge's discretion and both spouses held substantial separate property. The case was sent back only to recompute the community interest in the business.