Alaska Supreme Court: spouse's word alone cannot shield inheritance in divorce

A spouse who puts inherited money into a shared home can't pull it back out in a divorce just by testifying it was always meant to stay theirs, the Alaska Supreme Court ruled Friday.

The case comes from the Homer divorce of Stephanie and Scott Dickerson. Stephanie Dickerson cashed out stocks and bonds she inherited from her grandfather and put $212,537 toward the down payment on the family home. She testified that she had a verbal deal with her husband: once they refinanced, she could take the money back out and use it to buy a condo in Girdwood. Scott Dickerson denied there was any such agreement.

The couple did refinance, but the money stayed in the house. It remained there for years, until the home sold for $1.45 million in 2023 as part of the divorce. Superior Court Judge Bride Siefert believed Stephanie Dickerson's account and ruled the $212,537 was still hers alone. The Supreme Court reversed that part of the decision.

Here is how the law works. In Alaska, an inheritance belongs only to the spouse who receives it. It is separate property, not part of the marital estate that gets divided in a divorce. But when a spouse mixes that money with shared money, as happens when it goes into a jointly owned home or account, courts presume the spouse meant it as a gift to the marriage. The spouse who wants it back has to prove otherwise.

The justices ruled that a spouse's own testimony about what they intended at the time, or about an unwritten agreement, isn't enough to do that. There has to be something else backing it up. In earlier cases, that meant evidence like moving the money back into a separate account soon after, or the other spouse never having any control over it. The court said its past decisions fit this rule but had never spelled it out.

In the Dickersons' case, nothing was in writing, and the couple's actions didn't match the agreement she described. Both spouses controlled and improved the house while her money sat in its equity. The court acknowledged that expecting paperwork can be unfair to people with less business experience. But it said Stephanie Dickerson, a business owner, "could reasonably be expected to document an agreement involving an investment of over $200,000."

Because the inheritance became marital property, the court also rejected her separate argument that part of the home's increase in value should have been hers.

The rest of the trial court's rulings stand. The justices upheld splitting the marital estate evenly, turning down Scott Dickerson's request for 65% of it. They declined to count equity in a neighboring lot the couple sold to Stephanie Dickerson's mother, and they left the child support order in place. Each side will pay its own legal fees. The court noted that while Stephanie Dickerson lost the inheritance argument, it was not frivolous.

The case now goes back to Homer Superior Court. The $212,537 will be counted as marital property when the court recalculates what each spouse gets.

Justice Borghesan wrote the opinion, joined by Justices Henderson, Pate and Oravec. Chief Justice Susan Carney did not take part. Scott Dickerson represented himself on appeal. Anchorage attorney Heather Gardner represented Stephanie Dickerson.