PETERS VS. PETERS (DIVORCE PROPERTY & ALIMONY)

Statutes cited

Key holdings

Practitioner summary

In a probate declaratory-relief proceeding to characterize property, the court corrected the allocation of the burden of proof for jointly titled property. Estate and probate matters are civil actions subject to the rules governing civil cases. Cord v. District Court, 91 Nev. 260, 533 P.2d 1355 (1975). Property acquired after marriage is presumed community (NRS 123.220), rebuttable only by clear and convincing evidence. However, where real property is held in joint tenancy, the joint tenancy deed is itself the clear and certain proof needed to overcome the community property presumption, and the burden shifts to the party asserting a community character to prove transmutation by clear and convincing evidence. Use of community funds, earnings, or efforts to acquire or improve joint tenancy property, without proof of an original intent or subsequent agreement to hold it as community, does not establish transmutation. Mullikin v. Jones, 71 Nev. 14, 278 P.2d 876 (1955). A spouse's opinion as to whether property is separate or community is entitled to no weight. The district court thus erred in placing the burden on Esther, and the record contained no substantial evidence of transmutation. As to life insurance, where one spouse is the named beneficiary and remains so at the insured's death, the proceeds vest at that moment in the surviving spouse as separate property even though premiums were paid with community funds.

In plain language

Donald Peters Sr. and Esther Peters married in 1944, separated in 1972, and Donald filed for divorce in 1973. Before the divorce was resolved, Donald died. His son (the couple's only son) became executor of the estate and asked the court to declare certain real estate and life insurance proceeds to be community property that belonged to the estate. The district court agreed with the son and, importantly, placed the burden on Esther to prove the property was NOT community property. The Nevada Supreme Court reversed. The court explained the general rule that property acquired during marriage is presumed to be community property, which can only be overcome by clear and convincing evidence. But it drew a key distinction for property held in "joint tenancy" (a form of co-ownership with a right of survivorship). When a deed puts property in joint tenancy, that deed is itself strong proof that the property is NOT community property. So the burden actually fell on the son (who claimed it was community) to prove the couple had converted, or "transmuted," the joint-tenancy property into community property. He offered essentially no such proof, and merely using community funds to buy or improve joint-tenancy property does not, by itself, convert it. The district court had the burden backwards. The court also addressed the life insurance: because Esther was the named beneficiary and remained so when Donald died, the entire proceeds vested in her as her separate property even though the premiums had been paid with community funds. The court reversed the parts of the judgment treating the real property and insurance as community property belonging to the estate.