In In re Marriage of Brown the Washington Supreme Court held that the pain and suffering portion of a personal injury award recovered by a spouse from a third-party tort-feasor is the separate property of the injured spouse. Furthermore, recovery for lost wages and diminished earning capacity shall be community property up to the date of separation and from that date forward the property shall be the separate property of the injured spouse. The court also held that recovery for out-of-pocket expenses shall be characterized according to the fund from which they were paid, i.e., community or separate. Brown overrules a long line of cases which held that recovery from third party tort-feasors was community property. This case also interprets Washington’s community property statute to wit: community property is that property acquired by the labor, skill, or other productive efforts of either spouse during marriage.
The Brown case concerns Ronna and William Brown who were married on January 27, 1967. The wife, Ronna, instituted an action for dissolution on October 6, 1975. The parties later reconciled their differences, but on January 5, 1976 prior to the dismissal of he dissolution action, the parties entered into a postnuptial agreement. The agreement characterized certain assets as separate and community property and further provided, in the event of dissolution, for an equal division of community property and that each spouse would be awarded his or her separate property.
Ronna instituted a second dissolution action in September 1979. Six months prior to this action Ronna had been injured in an automobile accident. In the second dissolution action both parties stipulated that the postnuptial agreement was valid and binding. Pursuant to the agreement, the trial court disposed of all property including the claim for damages for injuries incurred in the April, 1979 automobile accident.
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W. Scott Green, Washington Now Recognizes the Fortuitous Acquisition of Anticipated Recovery for a Personal Injury Claim Form a Third-Party Tort-Feasor as Separate Property, 19 Gonz. L. Rev. 577 (1983).