Marriage of Worley

23CA0695 Marriage of Worley 08-01-2024

COLORADO COURT OF APPEALS

Court of Appeals No. 23CA0695

Douglas County District Court No. 20DR30951

Honorable Robert Lung, Judge

In re the Marriage of

Christopher M. Worley,

Appellee,

and

Sonya L. Ferriere,

Appellant.

JUDGMENT AFFIRMED IN PART, REVERSED IN PART,

AND CASE REMANDED WITH DIRECTIONS

Division I

Opinion by JUDGE SCHOCK

J. Jones and Welling, JJ., concur

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

Announced August 1, 2024

Griffiths Law PC, Jennifer Schaffner, Jamie Paine, Lone Tree, Colorado, for

Appellee

Belzer Law, Aaron B. Belzer, Ashlee N. Hoffmann, Boulder, Colorado, for

Appellant

1

¶ 1 In this dissolution of marriage case between Christopher M.

Worley (husband) and Sonya L. Ferriere (wife), wife appeals the

district court’s division of the marital estate and award of attorney

fees and costs. We affirm the property division, reverse the ruling

on attorney fees and costs, and remand for further proceedings.

I. Background

¶ 2 The district court dissolved the parties’ six-year marriage and

entered permanent orders. After setting aside each party’s separate

assets and debts, the court divided the marital estate.

¶ 3 The court ordered the parties to sell the marital residence, a

home on Star Streak Circle, and split the net proceeds. The court

found that it would be inequitable to allow wife to keep the Star

Streak home and that the sale of the home would provide each

party enough money to purchase a new residence. In light of the

ordered sale, the court did not value the home. But based on the

parties’ competing expert valuations, the court anticipated that

each party would receive at least $200,000 from the home’s equity.

¶ 4 The court then divided the remainder of the marital estate

approximately equally, with wife receiving about $187,500 of the

net assets and husband receiving about $195,500. In doing so, the

2

court allocated to husband two credit card debts that he had

incurred, in part, to pay his attorney fees and costs. The court

excluded from the marital debts (1) the balance of a credit card that

wife had used to pay a portion of her attorney fees and costs and

(2) a $20,000 loan wife purportedly received from her ex-husband.

¶ 5 Concerning attorney fees, the court found that the fees wife

had incurred to her then-current counsel (her third attorney in the

case) were reasonable and necessary to litigate the case. Based on

the parties’ disparate economic circumstances, particularly their

disparate incomes (husband’s monthly income was almost $13,000

more than wife’s), the court ordered husband to pay wife’s counsel

$25,000 under section 14-10-119, C.R.S. 2023.

II. Property Division

¶ 6 Wife asserts that the district court erred in dividing the marital

estate by (1) excluding wife’s purported loan from her ex-husband

as a marital debt; (2) classifying the Star Streak home as a marital

asset; and (3) treating the parties’ litigation expenses differently

when allocating marital debts. We discern no reversible error.

3

A. Standard of Review

¶ 7 The district court has great latitude to equitably divide the

marital estate, and we will not disturb its ruling absent a showing

of an abuse of discretion. LaFleur v. Pyfer, 2021 CO 3, ¶ 61; see

also § 14-10-113(1), C.R.S. 2023. A court abuses its discretion

when its decision is manifestly arbitrary, unreasonable, or unfair,

or when it misapplies the law. In re Marriage of Medeiros, 2023

COA 42M, ¶ 28.

B. Wife’s Purported Loan from her Ex-Husband

¶ 8 Wife contends that the district court erred by concluding that

her $20,000 loan from her ex-husband — purportedly incurred

during the marriage — was not a marital debt. We disagree.

¶ 9 The court engages in a two-step process when determining

whether to allocate a debt in the marital property division. See In re

Marriage of Cardona, 2014 CO 3, ¶ 12 (discussing the process for

determining marital property); In re Marriage of Jorgenson, 143 P.3d

1169, 1172 (Colo. App. 2006) (stating that a court’s allocation of

marital debts is in the nature of property division). First, the court

must determine whether the party actually incurred a liability that

must be repaid or if, instead, the party received a gift. See

4

Cardona, ¶ 12; cf. In re Marriage of Hoffman, 650 P.2d 1344, 1345-

46 (Colo. App. 1982). This is a factual question. See Hoffman, 650

P.2d at 1345-46. Second, if the court finds that a debt exists, it

must determine whether that debt is marital and subject to the

court’s allocation or is separate and shielded from its division. See

Cardona, ¶ 12; Jorgenson, 143 P.3d at 1172; see also § 14-10-

113(1). A debt incurred during the marriage is presumed to be

marital. See Jorgenson, 143 P.3d at 1172; see also § 14-10-113(3).

¶ 10 In allocating the parties’ marital debts, the court recognized

that wife sought credit for the loan from her ex-husband. But it

rejected that allocation as “inequitable and inappropriate,” and it

declined to include the purported loan as a marital debt.

¶ 11 Although the court’s findings could have been clearer, the

court appears to have excluded the purported loan because the

court did not find it to be a valid debt. If the court had determined

that the debt was separate, as wife suggests, it would presumably

have addressed that loan in the section of its ruling specifically

identifying the parties’ separate assets and debts. It did not.

Instead, it did not treat the purported loan as a debt at all.

5

¶ 12 We discern no error in the court’s finding. When, as here, a

party receives the benefit of payments made by someone with a

close personal relationship to the party, the court may reasonably

infer that the payment was a gift, absent evidence to the contrary.

Cf. First Nat’l Bank of Fort Collins v. Honstein, 144 Colo. 176, 178,

355 P.2d 535, 536 (1960) (“Transfers of property between parents

and children are presumed to be gifts until the contrary is clearly

and unequivocally shown.”). Therefore, wife bore the burden to

show that the purported loan from her ex-husband was, in fact, a

valid debt. See People in Interest of S.E.G., 934 P.2d 920, 922 (Colo.

App. 1997) (“The burden of proof generally rests upon the party who

asserts the affirmative of an issue. The test is to determine which

party would be successful if no evidence were to be adduced and

then place the burden of proof on the adverse party; thus, the party

seeking to change the status quo bears the burden of proof.”).

¶ 13 But at the permanent orders hearing, wife presented no

testimony, or other evidence, to establish the existence of this

purported debt. See In re Parental Responsibilities Concerning

N.J.C., 2019 COA 153M, ¶ 49 (recognizing that the parties must

present the relevant evidence to the district court and their failure

6

to do so does not provide grounds for reversal); In re Marriage of

Eisenhuth, 976 P.2d 896, 901 (Colo. App. 1999) (noting that the

court considers the evidence presented to it). She simply reported

the purported $20,000 loan as a line item on her sworn financial

statement and listed it on the property division spreadsheet.

¶ 14 It was for the district court to determine the credibility, weight,

probative force, and sufficiency of the evidence, as well as the

inferences and conclusions to be drawn from that evidence. In re

Marriage of Thorburn, 2022 COA 80, ¶ 49. Because the record

supports the district court’s finding, we may not disturb that

finding. See id.; In re Marriage of Evans, 2021 COA 141, ¶ 45.

¶ 15 To the extent wife highlights her testimony at the temporary

orders hearing concerning the purported loan, she did not present

or cite that evidence at the permanent orders hearing. But in any

event, at the temporary orders hearing, wife merely testified,

without corroborating evidence, that her ex-husband had used his

credit card to pay some of her moving expenses and that she owed

him this money. The court was free to believe all, part, or none of

wife’s testimony, even if it was uncontroverted. See Thorburn, ¶ 50.

7

¶ 16 Wife also asserts that husband appeared to concede the loan

was a marital debt by identifying it as such on his proposed

property division spreadsheet. But the court explicitly rejected both

parties’ proposed allocation of debts as inequitable. And wife does

not develop any separate argument challenging that determination.

See In re Parental Responsibilities Concerning S.Z.S., 2022 COA 105,

¶ 29 (declining to address an undeveloped argument).

¶ 17 We therefore are not persuaded that the district court erred by

not allocating this purported loan as a marital debt.

C. The Star Streak Home

¶ 18 Wife contends that the district court erred by not setting aside

the Star Streak home as her separate property when the parties had

agreed to exclude that home from the marital estate. We disagree.

¶ 19 All property acquired during the marriage is presumed

marital. § 14-10-113(3). A party may overcome this presumption

by showing that the parties had a valid agreement to exclude the

property from the marital estate. § 14-10-113(2)(d). The party

seeking to have property declared separate bears the burden to

establish that it retains its separate character. Medeiros, ¶ 52.

8

¶ 20 The parties acquired the Star Streak home during the

marriage. Wife therefore bore the burden to overcome the

presumption that it was marital property. Id. The court found,

albeit implicitly, that wife did not meet that burden, and the record

supports its finding. See In re Marriage of Morton, 2016 COA 1,

¶¶ 5, 13 (noting that, when supported by the record, we must defer

to the district court’s factual findings on the classification of

property as marital or separate); MGM Supply Co. v. Indus. Claim

Appeals Off., 62 P.3d 1001, 1005 (Colo. App. 2002) (“Whether [the]

burden of proof has been satisfied is a question of fact . . . .”); see

also S.Z.S., ¶ 23 (recognizing that findings may be implicit).

¶ 21 Early in the dissolution proceeding, wife claimed that husband

had agreed to purchase the Star Streak home for her and, by doing

so, had agreed it was her separate property. Husband disputed her

claim. But wife did not make this argument at the permanent

orders hearing. Nor did she present any evidence of such an

agreement. Indeed, she listed the home as marital property on the

parties’ joint property division spreadsheet. In the absence of any

such evidence or argument, the court reasonably determined that

wife had not overcome the marital property presumption. See

9

§ 14-10-113(3). To the extent wife presented additional evidence

over four months later when she moved to stay the judgment, that

was too late. See N.J.C., ¶ 49; Eisenhuth, 976 P.2d at 901.

¶ 22 Wife also argues that the court made no express findings

addressing her separate property claim. But given wife’s failure to

assert such a claim at the permanent orders hearing, much less

develop any supporting argument, we conclude that the court’s

findings were sufficient. See S.Z.S., ¶ 23; see also § 14-10-113(3).

¶ 23 We also reject wife’s undeveloped suggestion that the court

erred by ordering the parties to sell the home. See In re Marriage of

Lafaye, 89 P.3d 455, 462 (Colo. App. 2003) (The “mechanism

employed by the [district] court for dividing the marital estate is a

matter within the court’s discretion.”); see also S.Z.S., ¶ 29.

¶ 24 The district court therefore did not err by allocating the Star

Streak home as a marital asset in its marital property division and

ordering the parties to sell the home and divide the proceeds.

D. The Litigation Expenses as Marital Debts

¶ 25 Wife next contends that the district court abused its discretion

by allocating as marital debts certain debts husband incurred to

pay his attorney but declining to include debts wife incurred to pay

10

her attorneys. We conclude that the court correctly excluded wife’s

debts related to her attorney fees and that any error by the court in

including husband’s attorney-fee-related debts was harmless.

¶ 26 A debt incurred during the marriage for attorney fees and

costs associated with the dissolution proceeding is not a marital

debt subject to allocation. In re Marriage of Burford, 26 P.3d 550,

559 (Colo. App. 2001); In re Marriage of Rieger, 827 P.2d 625, 625

(Colo. App. 1992) (“[W]e find no authority for the characterization of

. . . attorney fees as a non-challengeable marital debt under § 14-

10-113 . . . .”). But see Burford, 26 P.3d at 559 (stating that

litigation costs that have been “paid . . . may be allocated in the

property division through reimbursement”). Rather, such litigation

expenses may be apportioned only in accordance with section 14-

10-119. See Burford, 26 P.3d at 559; Rieger, 827 P.2d at 625.

¶ 27 Wife argues that, at the permanent orders hearing, she

reported the following outstanding debts related to her attorney

fees: (1) an unpaid $36,000 bill to her previous dissolution attorney,

Marc Kaplan; (2) an additional loan from her ex-husband for

$30,000; and (3) a Pen Fed credit card debt that she incurred to pay

a retainer fee to Kaplan, which had an outstanding balance of

11

almost $11,000. The court declined to include the Pen Fed credit

card as a marital debt, noting that wife used that credit card to pay

her previous attorney. The court did not address Kaplan’s

outstanding bill or the purported attorney fee loan from wife’s ex-

husband. But wife does not dispute that all these debts were

associated with her outstanding litigation expenses. The court

therefore did not err by excluding them from its allocation of marital

debts. See Burford, 26 P.3d at 559; Rieger, 827 P.2d at 625.

¶ 28 Wife also argues that the court improperly allocated litigation

expenses that husband incurred on two credit cards he used to pay

attorney fees and costs, particularly when it declined to include

wife’s litigation expenses. Even assuming the court erred by

treating these as marital debts, we conclude that any error was

harmless. An appellate court may disregard any error or defect in a

dissolution proceeding when the aggregate effect of the error does

not affect the parties’ substantial rights. C.A.R. 35(c); see In re

Marriage of Balanson, 25 P.3d 28, 36 (Colo. 2001). A court’s error

in dividing the marital estate that affects only a small percentage of

the overall marital estate is harmless. Balanson, 25 P.3d at 36.

12

¶ 29 The court found that husband had an outstanding balance of

approximately $12,500 on one credit card and approximately

$3,000 on the other. The record reveals that although these two

credit cards had a total outstanding balance of $15,500, this

balance did not include only charges to husband’s attorney.

Husband also used these credit cards to purchase personal items

throughout the dissolution proceeding, and he consistently made

payments toward the unpaid balances. Thus, the exact amount of

litigation expense debt remaining on these credit cards is unclear.

¶ 30 But even assuming the total unpaid debt was associated with

husband’s litigation expenses, any error by allocating the aggregate

$15,500 debt accounts was too small of a percentage of the entire

marital estate to warrant reversal. These debts amount to less than

2% of the estimated $783,000 marital estate as valued by the court

(consisting of $400,000 of anticipated net proceeds from the sale of

the Star Streak home and approximately $383,000 in additional net

assets). See id. at 38 (suggesting that a property division error

affecting less than 2% of the overall marital estate is harmless).

13

¶ 31 Thus, the district court acted within its discretion by declining

to allocate wife’s litigation expenses, and any error allocating

husband’s litigation expenses does not warrant reversal.

III. Section 14-10-119 Attorney Fees and Costs

¶ 32 Wife next contends that the district court erred by awarding

her only $25,000 for her attorney fees and costs under section 14-

10-119. She argues that the court did not sufficiently explain the

basis for its determination or consider all her litigation expenses.

We agree that the district court’s findings are insufficient.

¶ 33 To ensure that a party in a dissolution proceeding does not

suffer undue economic hardship, a court may equitably apportion

attorney fees and costs between parties based on their relative

economic circumstances. In re Marriage of Collins, 2023 COA

116M, ¶ 49; see § 14-10-119. The court has broad discretion to do

so based on the circumstances of the case, and we will not disturb

the court’s decision absent a showing of an abuse of discretion. See

In re Marriage of Gutfreund, 148 P.3d 136, 141 (Colo. 2006).

¶ 34 But in awarding attorney fees and costs under section 14-10-

119, the court must make findings of fact and conclusions of law

sufficiently explicit to give the appellate court a clear understanding

14

of the basis for its decision. See In re Marriage of Aldrich, 945 P.2d

1370, 1378 (Colo. 1997); In re Marriage of Rozzi, 190 P.3d 815, 822

(Colo. App. 2008). The court must “explain how and why it arrived

at the specific amount of the award.” Aldrich, 945 P.2d at 1378.

¶ 35 Wife presented evidence that she had incurred attorney fees

and costs associated with the dissolution proceeding that exceeded

$100,000. Those fees included (1) an unpaid debt of approximately

$36,000 to her first attorney, Kaplan; (2) more than $15,000 to her

second attorney, Robert Abrams, who had represented her at the

temporary orders hearing; and (3) approximately $61,000 to her

then-current attorney, Elizabeth Bonanno. As noted above, she

testified that she had paid some of these fees with a $30,000 loan

from her ex-husband and the debt from the Pen Fed credit card,

which had an outstanding balance of almost $11,000.

¶ 36 At the time of the permanent orders hearing, the anticipated

shortfall in fees owed to Bonanno alone — after taking into account

the amount remaining in wife’s trust account — was $26,249.53.

This shortfall did not include the amounts that wife had already

paid to Bonanno or the amounts that wife had paid and still owed

to either of her prior attorneys, Kaplan and Abrams.

15

¶ 37 In awarding wife attorney fees under section 14-10-119, the

court found that Bonanno’s fees were reasonable and necessary.

Then, without further discussion, the court ordered husband to pay

$25,000 to Bonanno — the approximate amount of the anticipated

shortfall for Bonanno’s fees. The district court did not address the

additional attorney fees that wife had incurred during the case.

¶ 38 Even considering the district court’s findings in the permanent

orders as a whole, we cannot discern any basis for the court’s

decision to award wife $25,000. See id. Wife indicated that she had

incurred over $100,000 in attorney fees and costs and that she had

a substantial amount of outstanding debt incurred to pay those

litigation expenses. But it appears that the court only considered

one portion of those fees and costs — the portion wife would owe

her then-current attorney after her trust account had been

exhausted. The court made no findings concerning the other

attorney fees and costs wife had incurred, including (1) the $36,000

she still owed to Kaplan; (2) the more than $15,000 she paid to

Abrams; or (3) the fees she had already paid to Bonanno. Nor did

the court address wife’s outstanding debts for those fees, including

16

the purported $30,000 loan from her ex-husband and the $11,000

on the Pen Fed credit card.

¶ 39 Husband attempts to salvage the court’s ruling by pointing out

that he paid wife’s attorneys $23,000 after temporary orders and

$10,000 before the permanent orders hearing. He also asserts that

wife had an opportunity to settle the debt to Kaplan for $14,000

and failed to do so. But the court made no findings indicating that

it considered either of these circumstances in awarding wife

$25,000. Nor do they alone explain the court’s award.

¶ 40 We thus agree with wife that the district court did not make

sufficient findings to explain its decision to award her $25,000

under section 14-10-119. See id.; Rozzi, 190 P.3d at 822. We

therefore reverse this portion of the court’s judgment and remand

the issue for reconsideration. On remand, the court must make

findings sufficiently explicit to give us a clear understanding of the

basis of its decision. It must also make its decision based on the

parties’ economic circumstances at the time of the permanent

orders hearing. See In re Marriage of de Koning, 2016 CO 2, ¶ 33.

17

IV. Appellate Attorney Fees and Costs

¶ 41 Wife requests an award of her appellate attorney fees and

costs due to the disparity in the parties’ financial resources. See

§ 14-10-119; Collins, ¶ 86. Because the district court is better

equipped to address the factual issues associated with this request,

we direct it to address wife’s section 14-10-119 request for attorney

fees and costs on remand. See Collins, ¶ 86; see also C.A.R. 39.1.

¶ 42 The district court should also address wife’s request for

appellate costs under C.A.R. 39. See C.A.R. 39(a)(4) (“[I]f a

judgment is affirmed in part [and] reversed in part . . . costs are

taxed only as ordered by the [district] court.”).

V. Disposition

¶ 43 We reverse the portion of the judgment that awarded wife

attorney fees and costs under section 14-10-119 and remand the

case for further proceedings consistent with this opinion. On

remand, the court must also address wife’s request for appellate

attorney fees and costs. The judgment is otherwise affirmed.

JUDGE J. JONES and JUDGE WELLING concur.