Unmarried partner keeps boat bought with his own money, Alaska Supreme Court rules

The Alaska Supreme Court ruled Friday that when unmarried domestic partners split up, property one of them bought with their own money and titled in their name alone stays theirs. The ruling reversed a Dillingham judge's finding that a fishing charter boat and a building belonged to both members of a couple.

Under the ruling, such property stays separate "regardless of what the Bishop factors show." Courts have used those factors, from a 2002 Alaska Supreme Court case, to judge whether unmarried partners meant to share property, looking at things like joint bank accounts, shared household costs and joint businesses.

Scott King and Courtenay Carty were together from October 2015 until July 2023 and had a daughter. They ran a short-term rental, Lake Road Lodge, and a fishing guide business, West Side Charters. In 2019 King bought a boat, the Carole Mae, for $25,000, making the down payment and loan payments from his personal account. It was titled only to him and used for the charter business and family outings.

Superior Court Judge Stephen B. Wallace in Dillingham ruled in August 2024 that all the property the couple disputed was partnership property, including their Wood River Road home, both businesses, the boat and King's building on Highbush Drive. He ordered King to pay Carty $100,688 to even out a 50-50 split.

Justice Dario Borghesan's opinion borrows the tracing rule from divorce law, which classifies an asset by the source of the money used to buy it. The court had called that approach "logical" for domestic partners in Armstrong v. Woods, an unpublished 2019 decision. In a divorce case last month, the court ruled that a spouse who put inherited money into a jointly owned home could not get it back just by testifying it was meant to stay hers, Alaska News reported Sept. 27.

The court cited Carty's testimony that, although the couple intended a lifelong commitment, they chose not to marry because "if [they] didn't marry on paper, [they] wouldn't have to divorce in court," and "if [they] maintained separate assets, [they] wouldn't have to divide them if [they] were ever to separate."

"Even in marriage, with its formal commitment to union and default rule that property is shared, the law gives significant protection to people's separate property," Borghesan wrote.

The court also reversed on the Highbush building. King bought the land in 2008, seven years before the partnership began, and finished the building in 2011. Property owned before a partnership is not partnership property, even when a shared business uses it, the court said.

The case returns to the Dillingham court. The Supreme Court left open whether a partner's separate property can become shared through an implied gift, as it can in a marriage. Carty disavowed that argument.