PUTTERMAN VS. PUTTERMAN (DIVORCE PROPERTY & ALIMONY)

Statutes cited

Key holdings

Practitioner summary

The court affirmed an unequal division of community property, clarifying the 'compelling reason' requirement under the 1993 amendment to NRS 125.150. As amended, NRS 125.150 requires an equal disposition of community property unless the court finds a 'compelling reason' for an unequal disposition and sets forth in writing the reasons. See Lofgren v. Lofgren, 112 Nev. 1282, 1283, 926 P.2d 296, 297 (1996) (noting the Legislature deleted the equitable factors formerly required for a 'just and equitable' disposition). The court held the amended statute applied to the February 7, 1994 decree, rejecting the wife's argument that the pre-amendment 'just and equitable' standard governed because the complaint predated the change; thus it was error to divide the property 'fairly and equitably' based on the wife being the principal acquirer and the husband 'less of a contributing member.' Nonetheless, the court affirmed because the trial court's specific findings established compelling reasons in the form of financial misconduct. In Lofgren, financial misconduct - wasting or secreting community assets during the divorce process - was recognized as a compelling reason. Here the trial court found the husband refused to account for finances (including earnings) over which he had control, lied about having no income, and after separation charged several thousand dollars that the wife had to repay; these constituted compelling reasons for an unequal disposition. The court identified other possible compelling reasons (negligent loss or destruction of community property, unauthorized gifts, and possibly compensation for losses occasioned by the marriage and its breakup), but drew a sharp distinction: the secreting or wasting of community assets while proceedings are pending is compelling, whereas mere undercontribution or overconsumption of community assets during the marriage is not - almost all marriages involve some disproportion, and equal-division law does not permit a retrospective accounting of marital expenditures.

In plain language

In the Puttermans' divorce, the family court divided the community property unequally, giving the wife (Barbara) certain stock and a valuable country club membership on top of her one-half share of the rest of the community property. The court said it would be 'inequitable' not to do so, and reasoned in part that the wife was the principal earner while the husband (Mitchell) had contributed less to the community. Mitchell appealed, and the wife argued the old 'just and equitable' standard should apply because the complaint was filed before the 1993 statutory change. The Nevada Supreme Court affirmed. It explained that in 1993 the Legislature changed Nevada's rule for dividing community property from 'equitable' to 'equal': NRS 125.150 now requires an equal division unless the court finds - and sets forth in writing - a 'compelling reason' for an unequal division. The old equitable factors (like which spouse acquired the property) were deleted from the statute. The court held the amended, equal-division statute applied to the February 1994 decree, so it was error for the family court to divide property 'fairly and equitably' based on the wife being the greater contributor - undercontribution during a marriage is not a compelling reason for an unequal split. However, the court affirmed the result because the trial court had made specific, meticulous findings of genuine financial misconduct that did qualify as compelling reasons: the husband refused to account for finances under his control, lied to the court about having no income, and after separation charged several thousand dollars on credit cards that the wife had to pay. Those findings supplied compelling reasons under NRS 125.150 and its earlier decision in Lofgren v. Lofgren, so the unequal disposition was justified. The court distinguished true financial misconduct (hiding, wasting, or misappropriating community assets) from mere disproportionate contribution or consumption during the marriage, which cannot justify an unequal division.