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How Disclaimer Deeds Impact Real Estate Rights During a Divorce in Arizona


A to scale model home split in half with a gavel in the middle and two people on each side of the house representing divorce.

Divorce often introduces complexities involving the division of property. Among the legal mechanisms influencing property division in Arizona law, disclaimer deeds are always a hot topic of conversation. Understanding how they operate within Arizona's community property laws is essential for protecting one’s real estate interests when considering a divorce. In this blog, we’ll cover disclaimer deeds and their impact on real estate rights during a divorce in Arizona, so you have all the information you need to secure the legal representation you need. 

What is a Disclaimer Deed? 

A disclaimer deed is a legal instrument used when one spouse relinquishes any claim to property acquired during the marriage. This document is often signed at the time of acquisition, signifying that the property will be considered the sole and separate property of one spouse. While straightforward in intent, its application during divorce proceedings involves nuanced legal implications.  

How Does Arizona State Law View Disclaimer Deeds? 

Arizona operates under community property laws, which presume that assets or property acquired during the marriage belong equally to both spouses. However, a properly executed disclaimer deed can override this presumption. The case of Bell-Kilbourn v. Bell-Kilbourn (2007) confirmed that a valid disclaimer deed, signed at the time of acquisition, is treated as an enforceable contract, provided no valid affirmative defenses challenge its legitimacy. The property in question retains its status as separate property throughout the marriage.  

This differentiation impacts property division considerably during divorce, as a properly executed disclaimer deed may exclude the property from becoming part of the marital estate.  

Community Contributions and Reimbursements  

Even when property is designated as separate through a disclaimer deed, instances may arise where the marital community (both spouses) contributes resources that enhance or benefit the property. Common examples include mortgage payments, property improvements, or other financial investments using community funds.


Arizona courts apply the Barnett/Drahos formula to determine the community’s lien or reimbursement claim. This formula considers factors such as the community’s financial contribution, appreciation of the property during the marriage, and the property’s appraised value at different stages.

The formula is expressed as follows: 

C + (C/B x A), where:

  • C = Community contribution to the principal  

  • B = Appraised value of the property at acquisition  

  • A = Appreciation of the property during the marriage


Through this calculation, the community may claim reimbursement for contributions, along with a proportional return on investment. A notable case, Saba v. Khoury (2011), emphasized that community principal payments alone do not enhance the property’s value, but the community is entitled to a fair return for reducing the mortgage balance.  

Things to Keep in Mind for Divorcing Couples  

Negotiating real estate rights during divorce requires a thorough understanding of how disclaimer deeds function under Arizona law. Divorce raises intricate legal questions, particularly regarding community contributions, property character, and fair reimbursements.  

For divorcing couples, things to remember when considering a divorce involving real estate includes: 

  • Ensuring any disclaimer deed is properly executed at the time of acquisition, as its enforceability relies heavily on adhering to legal requirements.  

  • Documenting financial contributions from community funds toward property improvements or mortgage payments.  

  • Consulting experienced legal professionals to analyze potential reimbursement claims and determine appropriate compensation using established formulas.  

  • Seeking knowledgeable legal representation ensures clarity and equitable results in cases involving real estate and disclaimer deeds.  

Book Your Free Consultation 

Dividing property during a divorce involves significant legal challenges, especially when real estate and disclaimer deeds are involved. Having proper legal representation, like our team here at Simon Law Group is the best way to ensure you see a fair resolution that protects both individual and community property rights.


At Simon Law Group, for decades we have practiced Arizona divorce and real estate law, making us experts in navigating the complexities divorces involving real estate in Arizona. Our proven expertise ensures meticulous attention to your case, safeguarding your interests and securing equitable outcomes.


Going through a divorce involving real estate, children or both in Arizona? Ensure your rights are protected and take the first step toward clarity and resolution — schedule your free 60-minute consultation online or by calling 480-745-2450 today. 

 

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