Marriage of Heap

23CA0920 Marriage of Heap 07-11-2024

COLORADO COURT OF APPEALS

Court of Appeals No. 23CA0920

Boulder County District Court No. 20DR30407

Honorable J. Keith Collins, Judge

In re the Marriage of

Robert Bradford Heap,

Appellant,

and

Carol Linda Vilate,

Appellee.

JUDGMENT AFFIRMED AND CASE

REMANDED WITH DIRECTIONS

Division III

Opinion by JUDGE MOULTRIE

Yun and Davidson*, JJ., concur

NOT PUBLISHED PURSUANT TO C.A.R. 35(e)

Announced July 11, 2024

The W Law, Emily D. Warren, Carolyn C. Witkus, Denver, Colorado, for

Appellant

Dietze and Davis, P.C., Tucker M. Katz, Boulder, Colorado, for Appellee

*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art.

VI, § 5(3), and § 24-51-1105, C.R.S. 2023

1

¶ 1 Robert Bradford Heap (husband) appeals the permanent

orders entered following the dissolution of his marriage to Carol

Linda Vilate (wife) setting aside as wife’s separate property

$285,000 of equity in the marital home. We affirm.

I. Background

¶ 2 The parties were married in October 1999 and purchased the

marital home in July 2010.

¶ 3 During the marriage, the parties worked together in the

restaurant industry. They owned and operated various

establishments where husband provided the culinary services and

wife managed the business operations. Not all of their restaurant

ventures were successful; before purchasing the marital home, they

lost another home because of debts associated with a failed

restaurant.

¶ 4 When the parties purchased the marital home, wife

contributed $285,000 that she received from her parents — a gift

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characterized as her “inheritance.”

1

In July 2016, the parties

executed a notarized agreement (July agreement) that, as relevant

here, stated:

[Husband] and [wife], enter into a voluntary

agreement in regards to the sale or distribution

of assets of the [marital home]. The

distribution of assets or funds would be as

follows:

[Wife] will retain the amount of $285,000 that

was given to her . . . by her parents. . . . If the

house is sold [husband and wife] would split

the remaining profits of the house. . . .

¶ 5 Husband filed a petition for dissolution of marriage in

December 2020. During the dissolution proceedings, husband

contested the enforceability of the July agreement as a valid marital

agreement, asserting that (1) he and wife lived separately at the

time of signing the agreement, and he signed the agreement to try

1

Though characterized by wife as an “inheritance,” we conclude the

transfer of funds wife received from her parents is more

appropriately described as a gift because she received and accepted

the funds that her parents intended to give to her. Compare In re

Marriage of Balanson, 25 P.3d 28, 37 (Colo. 2001) (“In order to

qualify as a ‘gift,’ a transfer of property must involve a simultaneous

intention to make a gift, delivery of the gift, and acceptance of the

gift.”), with In re A.M.D., 78 P.3d 741, 743 (Colo. 2003) (“A monetary

inheritance is a particular form of a ‘monetary gift’ — it is simply

testamentary, rather than inter vivos, in nature.”).

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to keep their marriage together; (2) he didn’t understand what he

was signing due to MDMA therapy he received in the spring of

2015; and (3) the agreement lacked conspicuous waiver language as

required by section 14-2-309(3), C.R.S. 2023.

¶ 6 The district court found the July agreement enforceable

because

(1) the agreement was in writing and signed by both parties;

(2) the parties were not contemplating a dissolution or legal

separation when they signed the agreement;

(3) husband signed the agreement more than a year after

completing MDMA therapy and understood what he was

signing;

(4) the language in the agreement was clear and did not

require conspicuous language as husband did not waive

any rights; and

(5) the agreement was not unconscionable.

¶ 7 The district court then allocated $285,000 of equity in the

marital home to wife as her separate property.

¶ 8 Husband appeals the district court’s finding that the July

agreement was enforceable and its resulting allocation of $285,000

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in equity to wife as her separate property. Husband also appeals

the district court’s allocation of state and federal tax liabilities.

Both parties request appellate attorney fees.

II. Standard of Review

¶ 9 The classification of property as marital or separate is a legal

determination based on resolution of factual disputes. In re

Marriage of Krejci, 2013 COA 6, ¶ 3. And while we defer to the trial

court’s factual findings, we independently review the legal standard

the court applied. Id.

III. Applicable Legal Principles

A. Disposition of Marital Property

¶ 10 Under the Uniform Dissolution of Marriage Act (UDMA), a

court “shall set apart to each spouse [their] property and shall

divide the marital property” in a proceeding for dissolution of

marriage. § 14-10-113(1), C.R.S. 2023. And “marital property” is

all property acquired by either spouse after the date of marriage

except property described in the four statutory exceptions set forth

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in section 14-10-113(2).

2

See In re Marriage of Blaine, 2021 CO 13,

¶ 3.

¶ 11 One statutory exception is property “excluded by valid

agreement of the parties.” § 14-10-113(2)(d). However, “[t]he term

‘valid’ is not defined in section 14-10-113. Nor is it defined

anywhere else in the UDMA.” In re Marriage of Zander, 2021 CO 12,

¶ 17. “The term ‘valid’ is ordinarily and naturally understood as

referring to something that is effective and enforceable under the

law.” Id.

¶ 12 Regarding interspousal gifts, the supreme court has held that

“[p]roperty that is placed in joint tenancy by a spouse during the

marriage reflects an intent by the donor spouse to make a gift to the

marriage. Thus, such property may be presumed to be marital

property absent clear and convincing evidence to the contrary.” In

re Marriage of Balanson, 25 P.3d 28, 37 (Colo. 2001) (citations

omitted); see also Krejci, ¶ 2 (a gift by a third-party donor during

2

The exceptions are (1) property acquired by gift, bequest, devise,

or descent; (2) property acquired in exchange for property acquired

prior to the marriage or in exchange for property acquired by gift,

bequest, devise, or descent; (3) property acquired by a spouse after

a decree of legal separation; and (4) property excluded by valid

agreement of the parties. § 14-10-113(2)(a)-(d), C.R.S. 2023.

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the marriage that increases the value of a jointly titled asset of the

spouses is presumably a gift to the marriage, and that presumption

can only be rebutted by clear and convincing evidence).

B. Marital Agreements

¶ 13 Under the Uniform Premarital and Marital Agreements Act

(UPMAA), a “marital agreement” is “an agreement between spouses

who intend to remain married which affirms, modifies, or waives a

marital right or obligation during the marriage or at . . . marital

dissolution . . . or the occurrence or nonoccurrence of any other

event.” § 14-2-302(2), C.R.S. 2023. A “marital right or obligation”

arises “between spouses because of their marital status” and

includes, but is not limited to, “[a] right to property, including

characterization, management, and ownership.” § 14-2-302(4)(b).

¶ 14 Section 14-2-309 governs enforceability of agreements under

the UPMAA and says that a marital agreement is unenforceable if

the party against whom enforcement is sought proves, as relevant

here, that the agreement did not include a notice of waiver of rights

under section 14-2-309(3) or a plain-language explanation of the

marital rights being modified or waived by the agreement, unless

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the party had independent legal representation when the agreement

was signed. § 14-2-309(1)(c).

¶ 15 Section 14-2-309(3) requires a notice of waiver of rights to

include language “conspicuously displayed” and substantially

similar to the following:

If you sign this agreement, you may be:

Giving up your right to be supported by the

person you are marrying or to whom you are

married.

Giving up your right to ownership or control of

money and property.

Agreeing to pay bills and debts of the person

you are marrying or to whom you are married.

Giving up your right to money and property if

your marriage ends or the person to whom you

are married dies.

Giving up your right to have your legal fees

paid.

§ 14-2-309(3).

¶ 16 Marital agreements, like other contracts, should be construed

to give effect to the parties’ intent, and where the agreement’s terms

are unambiguous, we determine the parties’ intent from the

language of the instrument itself. In re Estate of Gadash, 2017 COA

54, ¶ 40.

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C. Attorney Fees

¶ 17 In any civil proceeding, the court shall assess attorney fees if it

finds that an attorney or party brought or defended an action that

was substantially frivolous, groundless, or vexatious.

§ 13-17-102(4), C.R.S. 2023. Under the UDMA, and after

considering the financial resources of both parties, the court may

order a party to pay to the other party a reasonable amount for the

cost of maintaining or defending any proceeding under the UDMA,

which includes attorney fees. § 14-10-119, C.R.S. 2023.

¶ 18 Under C.A.R. 39(a)(2), if a judgment is affirmed on appeal,

“costs are taxed against the appellant.” And under C.A.R. 39.1,

attorney fees may be recoverable if the appellate court in its

discretion determines the requesting party is entitled to an award of

attorney fees for the appeal. The appellate court may also remand

those determinations to the district court. See id.

IV. Discussion

A. Stipulation Regarding Tax Liabilities and Debt

¶ 19 In November 2023, the parties reached an agreement that

resolved all matters concerning the allocation of tax liabilities and

filed a joint motion requesting to withdraw husband’s tax argument

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and for a mandate to the district court to adopt the stipulation.

This court granted in part the joint motion to allow husband to

withdraw his tax argument but deferred to the assigned division the

determination of whether to remand the stipulation to the district

court. We conclude that remanding the parties’ tax stipulation to

the district court for adoption as an order of the court is

appropriate.

B. The July Agreement is an Enforceable Marital Agreement

¶ 20 Husband argues

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that the district court erred in finding the

July agreement enforceable because the agreement lacked a notice

of waiver with conspicuous language as required by section

14-2-309(3). Wife argues that the July agreement is enforceable

because it contained a plain language explanation of the marital

rights husband was modifying or waiving should the marital home

3

At trial, husband argued the July agreement was unenforceable

because he was under “duress” when he signed the agreement

because the parties signed it “right after” husband completed

MDMA therapy. Wife testified that husband completed the MDMA

therapy more than a year before the parties signed the July

agreement, and the district court did not credit husband’s

testimony that his memory was “a little foggy” surrounding the

execution of the agreement. Because husband hasn’t argued the

court’s findings and conclusions on this issue were erroneous here,

we deem this argument abandoned.

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be sold by describing the amount of wife’s separate property

interest ($285,000) and the basis for her claiming it as separate

property.

¶ 21 In reasoning that the July agreement was enforceable, the

district court found that the language of the agreement was clear,

and conspicuous waiver language wasn’t required because husband

didn’t waive any rights by signing it.

¶ 22 We disagree with the district court’s conclusion that husband

didn’t waive any rights by signing the July agreement, but we agree

that the July agreement’s language was clear.

¶ 23 The July agreement stated that the parties were entering into

a voluntary agreement regarding the sale or distribution of assets

from the marital home. It expressly stated that wife will retain

$285,000 — which was described as an inheritance from her

parents — as her separate property and the remaining equity in the

marital home would be split equally between husband and wife. As

such, this agreement plainly explained the marital rights husband

was modifying or waiving should the assets from the marital home

be sold or distributed. See § 14-2-309(1)(c). Thus, the agreement

was enforceable as a marital agreement under section 14-2-302.

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¶ 24 True, the July agreement didn’t have a conspicuously

displayed notice of waiver of rights. But section 14-2-309(1)(c)

requires either a notice of waiver of rights or a plain language

explanation of the marital rights being modified or waived by the

agreement; it doesn’t require both.

¶ 25 Because the plain language of the agreement evidences the

parties’ intent that wife’s $285,000 gift from her parents would be

treated as her own separate property should the assets from the

sale of the marital home be distributed, husband waived any

marital claim to that amount of equity. Thus, we affirm the district

court’s order allocating to wife as her separate property $285,000 of

equity from the marital home.

C. Appellate Attorney Fees and Costs

¶ 26 Husband requests attorney fees under sections 13-17-102 and

14-10-119, and C.A.R. 39.1. Wife requests attorney fees under

section 14-10-119 and C.A.R. 39.1 and costs under C.A.R. 39(a).

Both parties object to the other’s request for appellate costs and

attorney fees.

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1. Section 13-17-102

¶ 27 Husband cited section 13-17-102 in support of his request for

attorney fees but didn’t provide any factual or legal basis for an

award under this section. Husband’s request for attorney fees

under section 13-17-102 is denied. See In re Marriage of Aldrich,

945 P.2d 1370, 1379 (Colo. 1997) (“Conclusory statements that a

claim is frivolous, groundless, or vexatious are insufficient for

purposes of appellate review and inadequate to satisfy the statutory

requirement of specificity.”).

2. C.A.R. 39

¶ 28 As the prevailing party on appeal, wife is entitled to appellate

costs under C.A.R. 39 should the district court decide awarding

costs is appropriate under the circumstances. See C.A.R. 39(a), (c);

In re Marriage of Goodbinder, 119 P.3d 584, 586 (Colo. App. 2005)

(noting that the district court has discretion in awarding costs

unless a statute or rule specifically prohibits such award).

Accordingly, we remand the determination of wife’s appellate costs,

if deemed appropriate, to the district court.

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3. C.A.R. 39.1 and Section 14-10-119

¶ 29 Both parties request reasonable attorney fees under section

14-10-119, asserting that the other party has superior financial

resources, and cite C.A.R. 39.1 to support their respective requests.

Because the district court is better equipped to determine the

factual issues regarding the parties’ current financial resources, we

remand to it the issue of whether either party should be awarded

reasonable attorney fees. See In re Marriage of Bochner, 2023 COA

63, ¶ 22; see also In re Marriage of Schaefer, 2022 COA 112, ¶ 37

(holding that wife’s request for award of her attorney fees associated

with successful appeal of maintenance and child support awards

would be considered on remand).

V. Disposition

¶ 30 The judgment is affirmed. This case is remanded to the

district court with directions to (1) adopt the parties’ stipulation

regarding tax liabilities and enter it as a court order; (2) determine

the amount of and award to wife her costs associated with this

appeal, if appropriate; and (3) determine whether either party is

entitled to reasonable attorney fees under section 14-10-119.

JUDGE YUN and JUDGE DAVIDSON concur.