Arizona Court of Appeals Division Two Holds that Trial Court Erred in Interpreting Decree of Dissolution in Favor of Husband Because It Considered Only the Literal Construction of the Decree and Did Not Harmonize that Construction with Other Provisions or the Nature of the Decree.

When Selma Frey and Ivan Cohen divorced in 1983, they negotiated a marital settlement agreement (later merged into decree of dissolution) that provided Cohen with the right to live in an exclusive right to sell the residence. Upon any sale, Cohen was obligated to distribute one-half of the proceeds to Frey, but “consent or approval of” Frey to the sale was not required and Cohen had the right “to sell for whatever price and on whatever terms he desires.” When Cohen arranged for the sale of the residence to his sister for $100,000, Frey sought a temporary restraining order to prevent the sale. The trial court held that the decree permitted Cohen to sell the property for any price and on any terms, and Frey appealed.

The appellate court reversed this interpretation of the decree. Although acknowledging that the trial court’s interpretation of the plain language of the sale provision was literally correct, the appellate court found that read in context, the language is subject to more than one interpretation. Recognizing that the trial court’s literal construction would permit Cohen the discretion to sell the residence even “for a dime,” the appellate court held that this construction would “effectively obliterate Frey’s legal interest in the property,” rendering meaningless other provisions in the decree, including the provision providing Frey with one-half interest in the sale of the residence. Moreover, said the court, the trial court’s interpretation needed to, but did not, harmonize with the nature of the decree — the fair and equitable distribution of marital property. Accordingly, the sale provision should be interpreted to require that Frey sell the residence for an “appropriate price,” and the court remanded for a determination of whether $100,000 was, in fact, an appropriate price.

Judge Espinosa authored the opinion in which Presiding Judge Eckerstrom and Judge Brammer concurred.

PRACTICE POINTER: Relief from a dissolution decree is governed by Rule 85(c) of the Arizona Rules of Family Law, not Arizona Rule of Civil Procedure 60(c), though the rules are substantively identical. In addition, the court noted that the appropriate dispositive motion should have been a Rule 91 petition for post-decree enforcement (Family Law Rules), not a motion for summary judgment under Rule 56 (Civil Procedure).