ORGAD VS. ORGAD

Statutes cited

Key holdings

Practitioner summary

The court reviewed the district court's alimony determinations and disposition of community property, including underlying marital waste determinations, for abuse of discretion, citing Kogod v. Cioffi-Kogod, 135 Nev. 64, 75, 439 P.3d 397, 406 (2019). Factual findings are reviewed for abuse of discretion and will not be set aside unless clearly erroneous or unsupported by substantial evidence, per Ogawa v. Ogawa, 125 Nev. 660, 668, 221 P.3d 699, 704 (2009), with the court noting under Davis v. Ewalefo, 131 Nev. 445, 450, 352 P.3d 1139, 1142 (2015), that "deference is not owed to legal error" or "findings so conclusory that they mask legal error." On alimony, the court set out the governing framework: alimony is "financial support paid from one spouse to the other whenever justice and equity require it" (Rodriguez v. Rodriguez, 116 Nev. 993, 999, 13 P.3d 415, 419 (2000)); the award must be "just and equitable" (NRS 125.150(1)(a)); a district court may award alimony for a specified period or in a lump sum (NRS 125.150(1)(a)); NRS 125.190 permits permanent or lifetime alimony; and the court must consider the eleven factors in NRS 125.150(9) (citing Devries v. Gallio, 128 Nev. 706, 711-14, 290 P.3d 260, 264-65 (2012)). The court reiterated from Kogod that after considering those factors, a district court may award alimony to compensate for non-monetary contributions and economic losses from early termination of the marriage, and that alimony "is based on the receiving spouse's need and the paying spouse's ability to pay" (Kogod, 135 Nev. at 68, 439 P.3d at 401). Applying that framework, the court held the district court abused its discretion. The district court did not determine the amount of David's income on which it relied, despite finding his post-alimony financial needs were $5,000 per month; David's FDF reflected approximately $90,000 per year (about $7,500 per month), so an $8,000 monthly alimony obligation would leave him unable to meet his own needs. As to Sam's needs, the district court relied on FDF figures reflecting Poland living expenses despite her testimony she intended to remain in Las Vegas, then approximated her expenses at $8,000 per month without supporting findings—implicating MB Am., Inc. v. Alaska Pac. Leasing, 132 Nev. 78, 88, 367 P.3d 1286, 1292 (2016), and the findings requirement of Davis. The court further found no requisite factual findings supporting the 11-year duration given the 38-year marriage, Sam's homemaker role, her health issues, David's approaching retirement, and social security eligibility (which the district court found the parties were "probably not" able to receive but did not explicitly determine). Because the district court recited the NRS 125.150(9) factors "in rote fashion" without applying them to the facts, it abused its discretion under Devries, 128 Nev. at 712-13, 290 P.3d at 265. The court reversed and remanded the alimony award. On marital waste, the court applied NRS 125.150(1)(b), which requires equal disposition of community property absent a "compelling reason" for unequal disposition, and Lofgren v. Lofgren, 112 Nev. 1282, 1283, 926 P.2d 296, 297 (1996), recognizing intentional misconduct as such a compelling reason. It cited Kogod's definition of dissipation and its requirement that a district court differentiate ordinary consumption by higher-income earners from misappropriation of community assets for personal gain. Because David conceded $150,000 of waste, the court treated the concession as meritorious (citing Ozawa v. Vision Airlines, Inc., 125 Nev. 556, 563, 216 P.3d 788, 793 (2009)) and concluded the district court appropriately shifted the burden to David to explain expenditures exceeding his monthly expenses (Kogod, 135 Nev. at 78, 439 P.3d at 408; Putterman v. Putterman, 113 Nev. 606, 609, 939 P.2d 1047, 1048 (1997)). The court held the $167,354.56 waste determination was properly supported and rejected Sam's claim of additional unaccounted-for waste as not cogently argued (Edwards v. Emperor's Garden Rest., 122 Nev. 317, 330 n.38, 130 P.3d 1280, 1288 n.38 (2006); Quintero v. McDonald, 116 Nev. 1181, 1183, 14 P.3d 522, 523 (2000)). The court disposed of several other arguments in footnotes. Sam's life insurance argument failed because the district court gave her the option, not an order (citing Edwards; noting Wolff v. Wolff, 112 Nev. 1355, 1361, 929 P.2d 916, 920 (1996)). Sam's challenge to the $1,500 monthly installment structure failed because she acknowledged David could pay gradually (Old Aztec Mine, Inc. v. Brown, 97 Nev. 49, 52, 623 P.2d 981, 983 (1981); Pearson v. Pearson, 110 Nev. 293, 297, 871 P.2d 343, 345 (1994); Reed v. Reed, 88 Nev. 329, 331, 497 P.2d 896, 897 (1972)), though the court directed the district court to readdress the payment amount and schedule on remand. David's business valuation challenge failed because the district court made specific findings supporting Salazar's valuation and David demonstrated no material flaws (Quintero). David's argument that he was ordered to continue operating TCS was rejected as not cogent because the order did not so require.

In plain language

Sam and David Orgad married in Israel in 1983, moved to the United States in 1990, and in 2003 started a heating and air conditioning business called Temperature Control Services (TCS). During the marriage, David mostly ran the business while Sam raised the children and occasionally helped with management. Their relationship broke down, and Sam filed for divorce in Las Vegas in August 2019. The couple was granted a divorce in August 2021, but the court held off on deciding how to split their property, whether alimony (financial support paid from one spouse to the other) should be paid, and attorney fees until a trial. At trial, the two sides disagreed about how much the business was worth. David's expert valued TCS at $260,000 but did not testify at trial. Sam's expert testified that it was worth $663,000. The court found Sam's expert's report more accurate—partly because it accounted for potential unreported income that David's expert did not—and valued the business at $629,967. The court also addressed "marital waste," which refers to one spouse spending or destroying shared money for selfish reasons while a divorce is underway. David admitted he had wasted money, including trading in vehicles for new ones despite a court order (a joint preliminary injunction) barring such activity. He suggested $150,000 as the waste figure. After reviewing bank statements, tax returns, and the business's income statement, the court found David had wasted $167,354.56 over 27 months. Using the business value, other assets, and the waste figure, the court calculated that David owed Sam an "equalization payment" of $407,660.78 for her share of the community property, to be paid in $1,500 monthly installments. The court gave Sam the option (not a requirement) to secure that payment with a life insurance policy on David's life, at her own expense. The court also awarded Sam $8,000 per month in alimony for 11 years. The Court of Appeals reached two main conclusions. First, it decided the district court did not properly explain its alimony award and reversed that part, sending it back for the lower court to redo. The appeals court noted that David's take-home income was about $7,500 per month, yet the court ordered him to pay $8,000 per month in alimony while also finding he needed $5,000 per month to live on—figures that did not add up. The appeals court also found the lower court had relied on expense figures from Sam's Financial Disclosure Form that reflected her costs in Poland (where she had been living), even though she testified she intended to live in Las Vegas with different expenses, and then estimated her expenses at $8,000 per month without explaining how. The court also faulted the lack of findings explaining why 11 years was the right duration for a 38-year marriage in which Sam was primarily a homemaker. Second, the appeals court upheld the marital waste finding. Because David admitted he had committed waste, the burden shifted to him to justify his spending, and the court found the $167,354.56 figure was supported. Sam's argument that additional waste went unaccounted for was rejected as not sufficiently developed. The appeals court also rejected several other arguments as not cogently argued or not supported, including Sam's complaint about the life insurance option (the court noted she was given a choice, not an order) and David's arguments about the business valuation and about being required to operate TCS (the court noted the order did not actually require him to keep operating it).