A new case from the Washington State Court of Appeals, Division I, Clayton v. Wilson and Wilson, No. 57891-0-I, holds that a marital community is liable for the sexual assaults that one spouse committed against a child while managing the community’s assets.
Mr. Wilson sexually assaulted a minor child some forty times over a period of a few years after providing the Child with yard work at the Wilson’s rental properties. Mr. Wilson’s modus operandi was as follows: first, he would invite the boy to one of his rental properties to perform yard work. The boy would then perform the yard work. Mr. Wilson would then take the boy inside, molest him, and then pay him for the yard work.
The boy finally disclosed the abuse after he was eighteen. Upon disclosure, the police arrested Mr. Wilson and Mr. Wilson confessed.
Essentially the day after Mr. Wilson was released, Mr. and Mrs. Wilson retained a lawyer and agreed to get divorced. Working over the weekend, the lawyer drafted a separation agreement that transferred approximately $1.6 million, or 90 percent of all the community assets, to Mrs. Wilson. This agreement was then incorporated into the decree of dissolution.
Many months later, Mr. Wilson pled guilty and was sentenced to 130 months in prison. Several months later yet, the boy filed a civil law suit. At the bench trial, the court found that the sexual assaults occurred in the course of managing the community business and that, therefore, both Mr. Wilson and the marital community were liable. Total damages were about $1.4 million.
The first issue here was whether the community could be liable for the secret, intentional misconduct of one of its members.
The second issue was whether the community could be liable even after it was dissolved.
Analogizing to employment law, where the employer is liable for the torts of the employee, the court found that the community, Mr. Wilson’s employer, was liable for actions of it employee, Mr. Wilson, even though Mr. Wilson sexually assaulted the boy in secret and with intent.
Finding the community liable, of course, was only half of the boy’s battle. You can’t squeeze blood from a turnip and you can’t squeeze money from a defunct community. Mrs. Wilson had money, but the community did not. The boy needed to somehow undue the divorce and restore the marital community.
He did so with a theory of fraudulent transfer. The Court held that the separation agreement that transferred most of the money to Mrs. Wilson was invalid for lack of consideration. Assuming that an equitable distribution would have been 50 / 50, Mr. Wilson gave up 40 % of his assets without getting anything in exchange. Therefore, for the purposes of the boy’s claim, the community was never dissolved and it assets were still available to satisfy the judgment.
The moral here is don’t be greedy. It makes lots of sense to divorce your spouse the moment you discover that he has been sexually abusing children for the last several years. However, don’t take advantage of it. If Mrs. Wilson had settled for her equitable share of the community property, say, 50%, the Court undoubtedly would have found that the separation contract was supported by consideration. The decree of dissolution, therefore, would have been valid and her money would have been shielded.