Melody Crunk Telfer v. George Curtiss Telfer

This divorce appeal involves the classification of the appreciation in value of separate property. During the marriage, the wife’s family gave her ownership interests in two family companies. The parties used marital funds to pay their tax liabilities arising out of income from the companies that was attributed to them for tax purposes but retained by the companies. The trial court held that the appreciation in value of the wife’s ownership interests in the family companies were her separate property. We hold that, under the circumstances of this case, the parties substantially contributed to the preservation and appreciation in value of the wife’s separate assets, and so reverse the trial court’s classification of the appreciation in value as her separate property.