Zecic v. Zecic

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE

In Re the Marriage of:

HASIB ZECIC, Petitioner/Appellee,

v.

SEIDA ZECIC, Respondent/Appellant.

No. 1 CA-CV 26-0043 FC
FILED 08-13-2026

Appeal from the Superior Court in Maricopa County
No. FN2023-091019
The Honorable Amanda M. Parker, Judge

AFFIRMED IN PART; VACATED AND REMANDED IN PART

COUNSEL

Blake & Pulsifer PLC, Tempe
By Louis K. Lombardo
Counsel for Petitioner/Appellee

Berkshire Law Office PLLC, Tempe
By Keith Berkshire, Alexandra Sandlin
Counsel for Respondent/Appellant

ZECIC v. ZECIC
Decision of the Court

MEMORANDUM DECISION

Judge Angela K. Paton delivered the decision of the Court, in which
Presiding Judge Cynthia J. Bailey and Judge Michael J. Brown joined.

P A T O N, Judge:

¶1 Seida Zecic (“Wife”) appeals from the superior court’s
dissolution decree. For the following reasons, we affirm in part, vacate in
part, and remand for further proceedings consistent with this decision.

FACTS AND PROCEDURAL HISTORY

¶2 Wife and Hasib Zecic (“Husband”) married in 2015. Before
marrying Husband, Wife owned and operated a restaurant called Old
Town Sarajevo (“OTS”). During the marriage, both parties worked at OTS.
Although OTS was Wife’s separate property, Husband claimed he was
entitled to a share of the restaurant’s increase in value during the marriage
because their community efforts grew the business and paid off its debts.

¶3 In 2017, the parties bought the marital residence, but OTS was
on the title as the owner because neither party had good credit. The
residence was originally financed through a “hard money loan” to OTS and
a $100,000 down payment. The parties disputed the source of the $100,000
down payment. Husband claimed it was from the parties’ community
savings account. Wife, however, testified that she contributed $70,000 from
money she inherited when her father passed away and her savings. In 2018,
OTS (acting through Wife) signed a quitclaim deed conveying the residence
to Wife as “a married woman[.]” Both Husband and Wife signed as
guarantors on the deed of trust for a traditional mortgage.

¶4 There was a fire at OTS during the marriage, resulting in
property damage. The parties filed an insurance claim, and Wife received
an $81,000 insurance payment in May 2023 but did not share any of the
funds with Husband. He claimed entitlement to half, or, alternatively,
payment for the repairs he performed. Wife disputed this, claiming she
hired contractors to repair the damage to OTS.

¶5 At trial, Wife alleged that Husband committed waste by
withdrawing over $7,000 from a joint checking account shortly before he
filed for divorce. She also claimed that he wasted over $20,000 by sending

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money to his adult children and allowing them to use a community credit
card. Husband contends, without support from the record, that he
supported his children throughout the marriage with Wife’s knowledge
and consent. According to Husband, this was not an abnormal or excessive
expense.

¶6 Following a trial, the superior court made the following
rulings relevant to this appeal. It found Husband failed to show that OTS
increased in value or that the community was undercompensated during
the marriage. As a result, it awarded OTS to Wife as her separate property
with no offset or equitable lien to the community. The court found the
marital residence was community property and ordered it sold, with the
proceeds to be divided equally. The court rejected Wife’s claim that
Husband’s withdrawal of over $7,000 and the funds spent on his children
constituted waste. The court ordered Wife to pay Husband for half of the
OTS insurance proceeds. Finally, the court declined to award fees to either
party, finding no financial disparity and that both parties acted
unreasonably.

¶7 Both parties moved to alter or amend the decree. The
superior court granted Wife’s motion in part, vacating its order that Wife
pay Husband half the OTS proceeds. Wife timely appealed. We have
jurisdiction under Arizona Revised Statutes (“A.R.S.”) Section 12-
2101(A)(1).

DISCUSSION

I. The superior court did not err in characterizing the marital
residence as community property.

¶8 Wife argues the superior court erred in characterizing the
marital residence as community property because her separate property
business purchased it. We review the superior court’s allocation of
community property for an abuse of discretion, but the classification of
property as separate or community is a question of law that we review de
novo. Bell-Kilbourn v. Bell-Kilbourn, 216 Ariz. 521, 523, ¶ 4 (App. 2007). We
view the evidence in a light most favorable to upholding the decree. Thomas
v. Thomas, 142 Ariz. 386, 390 (App. 1984).

¶9 Property acquired during marriage is presumed to be
community property. A.R.S. § 25-211(A). “[T]he spouse seeking to
overcome the presumption has the burden of establishing the separate
character of the property by clear and convincing evidence.” Schickner v.

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Schickner, 237 Ariz. 194, 199, ¶ 22 (App. 2015). The court found Wife did
not rebut the presumption.

¶10 Wife contends the presumption does not apply because OTS
purchased the house. Wife reasons that because her separate property
business bought the house, it remained the separate property of OTS, and
its character did not change even if community funds were used to pay for
it. See A.R.S. § 25-213(A) (“the increase, rents, issues and profits” of a
spouse’s separate property remain separate property). But spouses can
transmute their separate property to community property. Moser v. Moser, 117 Ariz. 312, 314 (App. 1977). “Even in the absence of an explicit
agreement, written or oral, a court may find a transmutation of property if
the circumstances clearly demonstrate that one spouse intended to effect a
change in the status of [her] property.” Id.

¶11 Wife, as the owner of OTS, deeded the marital residence to
herself, as “a married woman” during the marriage. Although OTS first
acquired the residence, OTS later transferred the residence to Wife during
the marriage, giving rise to a presumption of community property. See
A.R.S. § 25-211(A). Indeed, the presumption that property acquired during
the marriage by either spouse is community property applies “irrespective
of which spouse holds legal title.” Ariz. Cent. Credit Union v. Holden, 6 Ariz.
App. 310, 313 (1967). In Holden, the wife quitclaimed her separate property
land to her husband. Id. at 312-13. The quitclaim deed did not specify that
the husband would take the land as his separate property. Id. at 313. This
court held that it was therefore community property. Id.

¶12 Other evidence also shows that Wife intended to transmute
the marital residence to community property. Wife took title as “a married
woman” instead of as her sole and separate property, which implies that
she intended it to be community property. Further, the deed of trust
accompanying the refinance named both Husband and Wife as owners and
grantors, and both signed the deed of trust. And Husband never signed a
disclaimer deed to the marital residence. As we held in Bell-Kilbourn, 216
Ariz. at 524, ¶¶ 9-10, a valid disclaimer deed sufficiently rebuts the
presumption that real property acquired during the marriage is community
property. In the absence of a disclaimer deed, the community property
presumption applies here because Wife acquired the marital residence from
OTS during the marriage.

¶13 Wife argues that the transfer of title to Wife “as a married
woman” did not transmute the residence to community property. She
contends that because OTS deeded the property to Wife as a married

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woman and not to the community, this case is unlike In re Marriage of Berger,
140 Ariz. 156 (App. 1983), and Toth v. Toth, 190 Ariz. 218 (1997). In those
cases, the courts found the spouses intended to gift their separate property
residences to the community by transferring the title to the community.
Toth, 190 Ariz. at 220; Berger, 140 Ariz. at 161. We are unpersuaded by the
distinction Wife urges. Here, the transfer to “Wife as a married woman”
similarly transmuted the residence to community property. See Holden, 6
Ariz. App. at 313.

¶14 Alternatively, Wife argues that because the house was
purchased with funds from her separate property business, the superior
court erred by not first allocating the funds used to buy the house between
her separate property and community property. Wife relies on the rule that
the community is only entitled to a share of the increase in value of her
separate property business and a share of its profits if Husband shows that
the value of the separate property business increased during the marriage.
See Rueschenberg v. Rueschenberg, 219 Ariz. 249, 254, ¶ 20 (App. 2008).
Husband proved no such increase in OTS. As a result, Wife argues,
Husband failed to show that the $100,000 down payment came from
exclusively community funds. She claims that the court must first
determine how much of the down payment was her separate property
before determining the character of the marital residence.

¶15 We disagree. As noted above, even if we presume for this
appeal that the funds were Wife’s separate property, OTS later transferred
ownership to Wife as a married woman. Thus, it transmuted the separate
property to community property. See supra ¶ 11. Given this, the court did
not have to determine the character of the funds used to purchase the
property. The transfer of title transmuted the property to community
property.

¶16 For this reason, this case includes a key factual difference
from Kim v. Pak, 258 Ariz. 594 (App. 2024), cited by Wife. In Kim, 258 Ariz.
at 596, ¶ 3, there was no subsequent transfer of ownership to one spouse as
a married person; Husband’s separate property business always owned the
property. Kim would control if Wife had not transferred the title to the
community. See id.

¶17 The transfer from OTS to Wife as a married woman
transmuted Wife’s separate property to community property. We discern
no error.

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II. The superior court erred in denying Wife’s claim for waste based
on Husband’s $7,480 withdrawal.

¶18 Wife argues the superior court abused its discretion in finding
that she did not show that Husband’s withdrawal of $7,480 from a joint
account less than two months before filing for divorce constituted waste.
We review the superior court’s determination of whether there is evidence
of a prima facie case under an abuse of discretion standard. Kline v. Kline, 221 Ariz. 564, 573, ¶ 35 (App. 2009).

¶19 The court is authorized to consider any excessive or abnormal
expenditures, destruction, concealment, or fraudulent disposition of
community property when determining the equitable division of property.
A.R.S. § 25-318(C). The party alleging marital waste has the burden of
making a prima facie showing of waste. Gutierrez v. Gutierrez, 193 Ariz. 343,
346, ¶ 7 (App. 1998). “It is then the burden of the spending spouse to go
forward with evidence to rebut the showing of waste because all of the
evidence relative to the expenditures is generally within the knowledge,
possession, and control of the spending spouse.” Id. at 346-47, ¶ 7. A prima
facie case requires some evidence to support a rational inference that the
allegation is true. See Kline, 221 Ariz. at 573, ¶ 35 (App. 2009); see also Mahan
v. First Nat’l Bank of Ariz., 139 Ariz. 138, 142, n.3 (App. 1984) (“A prima facie
case requires that there be evidence to justify, not necessarily compel, an
inference[.]”).

¶20 Wife provided evidence that Husband withdrew $7,000 in
one transaction from the parties’ joint account (BMO x9473) on February 3,
2023. On the same day, he deposited $7,000 into his separate checking
account (BMO x2236). He also withdrew $480 on February 3, 2023, from
the joint account (BMO x9473) but there is no corresponding deposit into
his separate checking or any other account. Husband made these
withdrawals less than two months before he filed the petition for
dissolution. The $7,000 withdrawal was also unusually large compared to
the other transactions.

¶21 Contrary to Husband’s assertion, the bank records support
Wife’s testimony. These facts support an inference of waste. See Goodell v.
Goodell, 257 Ariz. 563, 571, ¶ 36 (App. 2024) (holding that the timing of the
alleged waste is a relevant consideration); see also West v. West, 1 CA-CV 25-
0609 FC, 2026 WL 1257316, at *3, ¶ 17 (Ariz. App. May 7, 2026) (mem.
decision) (finding that the wife met her prima facie burden with evidence
of large withdrawals not directly traced to a community expense and a
deposit into a separate account to which the wife had no access).

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¶22 The superior court found that Wife did not meet her burden
because she failed to show how much was in the joint BMO account on the
date of service. We infer that meant Wife failed to show that Husband
never repaid the funds. But this improperly shifted the burden. Wife met
her prima facie burden by showing the large transfer of community funds
to Husband’s separate account shortly before he filed the dissolution
petition. The burden then shifted to Husband to explain how he spent these
funds or if he repaid them. Gutierrez, 193 Ariz. at 346-47, ¶ 7.

¶23 Husband did not show how these withdrawals benefited the
community. See Goodell, 257 Ariz. at 571-72, ¶ 36 (holding that pre-petition
conduct must affirmatively benefit the community). In fact, he failed to
address either withdrawal at trial. Thus, Wife met her burden of
establishing a prima facie case, and Husband did not rebut it.

¶24 On appeal, Husband argues that Wife knew that he withdrew
funds to give to his adult children which was a common expenditure in
their marriage. Husband conflates Wife’s two different waste arguments.
Wife’s pretrial statement listed several specific transfers to his adult
children and credit card charges by his adult children as waste. But Wife
also argued that the court should account for the $7,480 withdrawal from
the BMO account in allocating community assets. Thus, Wife’s testimony
about credit card charges and Western Union transfers did not apply to the
$7,480 withdrawal from the joint BMO account.

¶25 We vacate the order denying Wife’s claim for waste based on
Husband’s withdrawals of $7,480 from the joint BMO account. On remand,
the court shall allocate those funds equitably.

III. The superior court erred in finding Wife unreasonably failed to
disclose the insurance payment to OTS, which tainted its
attorneys’ fees consideration.

¶26 Wife argues the superior court erred in denying her request
for attorneys’ fees based on erroneous unreasonableness findings. We
review the decision on a request for attorneys’ fees for an abuse of
discretion. Myrick v. Maloney, 235 Ariz. 491, 494, ¶ 6 (App. 2014). In
determining whether to award attorneys’ fees, the court must consider “the
financial resources of both parties and the reasonableness of the positions
each party has taken throughout the proceedings.” A.R.S. § 25-324(A).
Courts evaluate the reasonableness of a party’s legal position using an
objective standard. In re Marriage of Williams, 219 Ariz. 546, 548, ¶ 10 (App.
2008).

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¶27 The superior court denied Wife’s request for attorneys’ fees,
finding no financial disparity and that both parties acted unreasonably.
Specifically, the court found Wife was unreasonable in (1) refusing to
participate in meaningful settlement negotiations until the day of trial,
which “was designed to delay these proceedings further[,]” (2) failing to
disclose that she received an $80,000 insurance payment related to OTS, and
(3) failing to disclose that she sold OTS.

¶28 Wife challenges the findings that she unreasonably failed to
inform Husband of the sale or the insurance payment. The record shows
that Wife entered a contract to sell OTS for $200,000. The buyer made an
$80,000 down payment in October 2024, but when he tried to cancel the
contract and get his money back, Wife refused. At the time of trial, this
dispute had not been resolved.

¶29 In addressing the value of OTS, the superior court noted that
“it is unclear from the record whether Wife has sold the restaurant.” Yet in
awarding attorneys’ fees to Husband, the court found that Wife’s failure to
disclose this transaction was unreasonable. These findings are inconsistent.
Although the value of OTS was a relevant issue at trial because Husband
asserted, albeit unsuccessfully, an interest in OTS, the fee award is based on
Wife’s failure to disclose a sale that did not occur. Without more findings,
it is unclear how this was unreasonable.

¶30 Next, during the marriage, Wife filed an insurance claim for
property damage at OTS, resulting in an $81,000 insurance payment. Wife
argues that OTS was undisputedly her separate property, so Husband was
not entitled to any of the insurance payment. In fact, the court granted
Wife’s motion to alter the decree as to the insurance payment. The court
found that the insurance proceeds belonged to OTS, which was Wife’s
separate property, and Husband failed to show that he had any interest in
the increased value of OTS. It is also unclear how the court determined that
Wife failed to timely disclose the insurance payment when Husband’s
pretrial statement and the business valuation—prepared over six months
before trial—addressed the insurance payment. The record does not
support the finding that Wife unreasonably failed to disclose this payment.

¶31 Husband argues that we may affirm the fee award if Wife was
unreasonable for any reason given by the superior court. To be sure, Wife
does not challenge the finding that she unreasonably refused to participate
in pretrial settlement negotiations until the day of trial, which the court
found was a delay tactic. But the record does not support all of the court’s
unreasonableness findings. Because we do not know how much weight the

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court attributed to each finding, we must vacate the fee award and remand
for reconsideration.

¶32 Both parties request an award of attorneys’ fees on appeal
under Section 25-324. After considering the financial resources and the
reasonableness of the parties’ positions, we decline to award fees to either
party. Wife, however, is entitled to recover her costs on appeal under
Section 12-342(A) upon compliance with Arizona Rule of Civil Appellate
Procedure 21.

CONCLUSION

¶33 We affirm the finding that the marital residence is community
property. We vacate the denial of Wife’s waste claim and remand for the
court to equitably allocate the $7,480 Husband withdrew from the parties’
joint bank account. We vacate and remand for reconsideration of Wife’s
request for attorneys’ fees.

MATTHEW J. MARTIN • Clerk of the Court
FILED: JR

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