A recent ruling from the Arizona Court of Appeals has clarified the liability of marital communities in business disputes. The court ruled in the case of PSG Energy Group LLC v. John W. Bereckis et al., No. 1 CA-CV 26-0016, that the marital community of John and Jennifer Bereckis is liable for a judgment awarded to PSG Energy Group. This decision affects how debts incurred during marriage can be enforced against community property.

The case began when PSG Energy Group entered into contracts with John Bereckis and his company, Universal Solar of America. After a dispute arose regarding payments, the matter went to arbitration, where PSG won and was awarded over $200,000 in attorney fees and related expenses. The court's ruling on November 10, 2026, confirmed that PSG could collect this amount from the Bereckis' marital community assets.

Background

PSG Energy Group LLC, the plaintiff in this case, is a company involved in the solar energy sector. John Bereckis, the defendant, was engaged in business through his company, Universal Solar of America. The dispute arose from contracts related to solar energy projects that John and Universal had with PSG. Each contract included an arbitration clause, which led to the arbitration process when disagreements emerged.

During the arbitration, John Bereckis claimed breach of contract, while PSG countered with claims of unjust enrichment. The arbitrator ultimately ruled in favor of PSG, awarding them $210,556.31 in fees and costs. Following this, PSG sought to confirm the arbitration award in the superior court, obtaining a default judgment against John and Universal when they failed to respond.

When PSG attempted to collect on the judgment, John and his wife Jennifer contested the garnishment of their joint bank account, arguing that Jennifer was not a party to the arbitration or the confirmation proceedings. PSG then initiated a declaratory judgment action to determine the liability of the marital community for the judgment amount.

The Ruling

The Arizona Court of Appeals, led by Judge Daniel J. Kiley, upheld the lower court's decision that the Bereckis' marital community was liable for the judgment awarded to PSG. The court stated, "the business dealings that John and Universal had with PSG all inured to the benefit of the Bereckis marital community." This ruling emphasized that debts incurred during marriage can be enforced against community property, even if one spouse was not directly involved in the legal proceedings.

The court also addressed the argument from the Bereckises that Jennifer's lack of involvement in the arbitration and confirmation action should protect their community assets. The court referenced a previous case, Lattin v. Shamrock Materials, which established that a spouse's due process rights are protected as long as they have an opportunity to defend against collection efforts. The court concluded that Jennifer had sufficient opportunity to defend her interests during the declaratory judgment action.

Impact

This ruling has significant implications for how marital communities are treated in legal disputes involving debts and obligations. It clarifies that a spouse's actions in business dealings can bind the marital community, even if the other spouse is not a named party in legal proceedings. This decision reinforces the principle that debts incurred during marriage are generally considered community debts, which can be enforced against shared assets.

Furthermore, the court's ruling may influence future cases involving marital community liability, particularly in business disputes. It sets a precedent that could affect how parties approach arbitration and the importance of naming both spouses in legal actions involving community debts.

What's Next

The court remanded the case with instructions to modify the declaratory judgment regarding the inclusion of discovery sanctions, which were not part of the original complaint. PSG may seek to recover costs associated with the appeal, but both parties were denied fees at this stage. The decision can potentially be appealed further, but details were not available in the court filing.