Opinion
NOT TO BE PUBLISHED
APPEALS from judgments of the Superior Court of Los Angeles County No. BP084768, Aviva K. Bobb, Judge.
Law Offices of Lee B. Ackerman and Lee B. Ackerman for Defendants and Appellants Jerry De Mille and Michael De Mille.
Law Offices of Vikram Brar and Vikram Brar for Defendant and Appellant Michael De Mille, as Personal Representative, etc.
LaBowe, LaBowe & Hoffmann, Mark S. Hoffman, Erika Mansky; Greines, Martin, Stein & Richland, Marc J. Poster and Alana H. Rotter for Plaintiff and Respondent.
Gifford, Dearing & Abernathy and Henry H. Dearing for Defendants and Respondents.
ASHMANN-GERST J.
We are presented with two appeals. In the first appeal, Jerry De Mille (Jerry) and Michael De Mille (Michael) appeal a probate judgment that nullified the transfer of personal property from Jerry to Michael. The second appeal involves a judgment enforcing liability on a bond issued by Horace W. De Mille (Horace). The judgment against Horace is challenged by Michael in his capacity as personal representative of the Estate of Horace W. De Mille. The appeals are opposed by respondent Citizens Business Bank (Bank) in its capacity as successor trustee of the Revocable Living Trust of David E. De Mille and Lois De Mille (Primary Trust). Certain beneficiaries of the Primary Trust join in the Bank’s briefs.
These are the second and third appeals pertaining to these parties. The first appeal was decided in De Mille v. Citizens Business Bank (Nov. 7, 2007, B190412) [nonpub. opn.] (prior appeal).
For ease of reference, we have used the first name of any party whose name is De Mille.
This third appeal was filed by Jerry in his capacity as trustee of Horace’s living trust. We ordered the appeal stayed until the personal representative of Horace’s estate substituted in, which Michael did.
The beneficiaries are Eva Groves (Groves), Robert Groves, Steven M. Groves, William W. Schmidt, Delores Schmidt Grantham, Virginia Schmidt Ackerman, Ronald Binder, Kathleen Binder, Bradley F. Campbell, Douglas B. Campbell, Velma Schmidt Harris, Town of Rockville, Utah and Corporation of the Presiding Bishop of The Church of Jesus Christ of Latter-Day Saints.
We find no error and affirm.
FACTS
Events and proceedings related to the prior appeal; Judge Jane L. Johnson’s rulings on various petitions; Judge Michael I. Levanas’s rulings on objections to the discretionary bond ordered by Judge Johnson
The Primary Trust
David E. De Mille (David) and Lois De Mille (Lois) formed the Primary Trust on August 25, 1988, and restated it on April 14, 2000. Upon Lois’s death, specific distributions were supposed to be made to Dennis Charles Glover, Anne C. O’Connor, John Alan Glover, and Charles W. Glover. And upon David’s death, specific distributions were supposed to be made to Dennis M. De Mille, Robert Groves and Steven M. Groves. Once David and Lois were both deceased, the trustee was supposed to divide the Primary Trust estate into 66 shares and distribute specified shares to Dennis M. De Mille (or others if he was not living), Robert Groves, Steven M. Groves, Dennis Montigo, Vartan Nostri, a special needs trust for Abner De Mille, Ronald Campbell, Janet Balta, Town of Rockville, Corporation of the Presiding Bishop of The Church of Jesus Christ of Latter-Day Saints, The John Birch Society, Dennis Charles Glover (or others if he was not living), Anne C. O’Connor, John Alan Glover, Charles W. Glover, The Yosemite Fund, William R. Schmidt, Velma Schmidt Harris, Delores Schmidt Grantham, Virginia Schmidt Ackerm, Ronald Binder and Kathleen Binder. (De Mille v. Citizens Business Bank, supra, B190412 [nonpub. opn.].)
By its terms, the Primary Trust was divided into Trust A, Trust B and Trust C when Lois died on October 17, 2000. Each trust was supposed to be held, administered and distributed as a separate trust. While Trust A was subject to amendment by David, Trust B and Trust C were not. (De Mille v. Citizens Business Bank, supra, B190412 [nonpub. opn.].)
The specific gift designation and power of appointment
On November 21, 2002, David purportedly amended the Primary Trust and appointed Jerry as trustee. Thereafter, David purportedly executed a specific gift designation instructing Jerry to distribute David’s personal property to David’s brother, Horace. A power of appointment was prepared but not signed. It proposed to have Jerry pay the net income of Trust A, Trust B and Trust C to Dennis De Mille and David’s grandchildren-Michelle Cavaness, Dennis Michael Montoya, Robert Groves and Steven M. Groves. The power of appointment then stated: “‘Upon the death of the last surviving beneficiary, the Trustee shall distribute the balance of the [Primary Trust] to [Horace]. If [Horace] fails to survive the last surviving beneficiary by Thirty (30) days, said share shall be distributed to [Jerry], and upon such distribution the Trust shall thereupon terminate.’” (De Mille v. Citizens Business Bank, supra, B190412 [nonpub. opn.].)
An unsigned second amendment to the Primary Trust stated: “‘All tangible personal property belonging to the Trust Estate shall be distributed to [Horace]. In the event [Horace] fails to survive the Trustor by Thirty (30) days, this gift shall be distributed to [Jerry.]’” (De Mille v. Citizens Business Bank, supra, B190412 [nonpub. opn.].) Via handwritten notes, David purportedly authorized gifts of $11,000 to Horace, Jerry and Michael. (Ibid.)
Jerry’s petition to confirm exercise of power of appointment
On March 22, 2004, Jerry filed a petition with the probate court for confirmation of David’s exercise of power of appointment (confirmation petition). Jerry’s amended first account of the Primary Trust indicated that Trust A contained four collectible automobiles valued at a total of $201,000; four collectible motorcycles valued at $131,000; motorcycle related literature valued at $46,000; various motorcycle accessories valued at $16,000; 20 collectible bicycles valued at $89,000; and bicycle accessories and literature valued together at $98,000. (De Mille v. Citizens Business Bank, supra, B190412 [nonpub. opn.].)
Jerry’s petition was denied.
Groves’s petition to remove Jerry as trustee of Trust B and Trust C
On June 10, 2004, Groves filed a petition to remove Jerry as trustee of Trust B and Trust C. The probate court removed Jerry as trustee of Trust B and Trust C and replaced him with the Bank. (De Mille v. Citizens Business Bank, supra, B190412 [nonpub. opn.].)
Groves’s petitions to remove Jerry as trustee of Trust A and for recovery of personal property and damages
On June 27, 2005, Groves and other beneficiaries filed a petition to remove Jerry as successor trustee of Trust A and appoint a successor trustee (removal petition). In conjunction, she filed a petition for recovery of property taken by Jerry and an award of double damages (recovery and damages petition).
In her petitions, Groves alleged: Jerry forged the specific gift designation knowing personal property would be distributed to intended beneficiaries free of any death tax. He forged David’s signature on the handwritten notes that he now claims support a finding that David wanted to exercise his power of appointment. On March 30 and 31, 2003, while David was in the hospital, Jerry gave Jeffrey Gilbert (Gilbert) money to purchase motorcycles, bicycles and related items (sometimes referred to as collectibles). David died on April 1, 2003. Jerry now contends that the collectibles belong to his father, Horace. Nonetheless, Jerry retains possession. On David’s estate tax return, Jerry listed the value of the property as $582,000. But Jerry spent at least $50,000 more for those purchases. Also, Jerry paid Gilbert $120,000 for unspecified services. Jerry tried to convince some of the beneficiaries that they could receive secret distributions in contravention of the Primary Trust. Further, he attempted to hide his purchase and possession of the collectibles.
The trial was before Judge Johnson.
Judge Johnson issued a statement of decision on January 23, 2006, and found, inter alia, that Jerry forged David’s name on the exercise of power of appointment and the specific gift designation. Also, she found that Jerry took $656,000 in cash from the Primary Trust and purchased personal property prior to David’s death. After David’s death, Jerry improperly used Primary Trust assets to purchase personal property worth $339,000. (De Mille v. Citizens Business Bank, supra, B190412 [nonpub. opn.].) As a prophylactic, Judge Johnson stated: “[Jerry] must personally provide an undertaking in the amount of $1,000,000.00 (in addition to the $2,000,000 already posted).” Judge Johnson indicated that the reason she exercised her discretion to order a $1 million bond was because Jerry “would remain in possession of money and property belonging to the [Primary Trust] pending an appeal of this ruling and the [Primary Trust] beneficiaries would thereby be subjected to unacceptable risk of loss.”
According to Jerry, the $2 million bond was an executor’s bond.
Judge Johnson exercised her discretion pursuant to Code of Civil Procedure section 917.9, subdivision (a), which provides in relevant part: “The perfecting of an appeal shall not stay enforcement of the judgment or order in cases not provided for in Sections 917.1 to 917.8, inclusive, if the trial court, in its discretion, requires an undertaking and an undertaking is not given, in any of the following cases: [¶] (1) Appellant was found to possess money or other property belonging to respondent. [¶] (2) Appellant is required to perform an act for respondent’s benefit pursuant to judgment or order under appeal.”
On February 17, 2006, Judge Johnson issued an order granting the removal petition. The Bank was appointed as successor trustee and Jerry was ordered to pay back $298,300 in fees he paid to himself, $40,000 in fees he paid to Gilbert for accounting services, and $33,000 for cash gifts paid to Jerry, Horace and Michael. Jerry was also ordered to reimburse the Primary Trust in the amount of any payments to Gilbert in excess of $87,500 as well as any fees incurred to pursue the confirmation petition. Further, Jerry was ordered to sell three motorcycles he purchased after David died and deliver the net proceeds to the Bank. He was required to reimburse the Primary Trust the difference between the net proceeds from the sale and $339,000. With respect to the recovery and damages petition, Jerry was ordered to sell the collectibles in his possession that he purchased for $656,000 while using cash from the Primary Trust. Under Probate Code section 859, Jerry was adjudged liable for double damages in the amount of $1,312,000 and was ordered to pay that sum to the Bank. The order also stated: “Pending any appeal of this order or any part thereof, the court requires [Jerry] to obtain and file an undertaking as provided in [Code of Civil Procedure section 917.9] in the amount of $1,000,000.00 in order to stay the operation and effect of the court’s orders of payment, sale, transfer and delivery of funds and property set forth herein.”
Based on the statutory scheme, the $1,312,000 and other portion of the money judgment were not stayed pending appeal unless Jerry posted a bond. Code of Civil Procedure section 917.1, subdivision (a) provides: “(a) Unless an undertaking is given, the perfecting of an appeal shall not stay enforcement of the judgment or order in the trial court if the judgment or order is for any of the following: [¶] (1) Money or the payment of money, whether consisting of a special fund or not, and whether payable by the appellant or another party to the action.”
Notice of the bond; objections
Jerry filed notice of a $1 million bond. Horace was the surety. The Bank filed a motion objecting to Horace’s bond. Groves and The John Birch Society joined. The motion was made on the following grounds: (1) the bond was defective because there was one personal surety instead of two; (2) the personal surety was mentally incompetent; (3) the amount of the bond was insufficient because it had to be for double the damages award pursuant to Code of Civil Procedure section 917.1, subdivision (b); and (4) Jerry could not use his executor’s bond to stay enforcement of the judgment.
The hearing on the objections to the bond
Judge Lavanas heard the motion. He asked why the parties did not bring the motion before Judge Johnson, and Groves’s attorney replied: “Your honor, the answer is that Judge Johnson wanted all further decisions in this case to be handled back through Department 11. So she has made the order, but she’s also clearly indicated that she doesn’t want anything more to happen in Department 56. She’s directed us all to bring everything back through Department 11.” After noting that Judge Johnson’s order was specific to Code of Civil Procedure section 917.9, Judge Levanas asked why no one addressed a bond pursuant to Code of Civil Procedure section 917.1. The Bank’s counsel stated: “We weren’t even involved in this case at that time. So we didn’t have an opportunity to be heard as to the amount of the bond, and I think that the court is compelled to give a bond amount per [Code of Civil Procedure section 917.1]. It’s not discretionary.”
Judge Levanas stated that he thought “the bond in this matter should be set under [Code of Civil Procedure section 917.9] for a million dollars. I think an additional bond should be set pursuant to [Code of Civil Procedure section 917.1].” When Judge Levanas asked the parties how to calculate the bond, Jerry’s attorney interrupted, averring: “I can stipulate we’re not going to file a bond under [Code of Civil Procedure section 917.1]. So we don’t need to calculate it[, ] which means they’re free to attempt to collect the money judgment portions of the judgment pending the appeal. All we want to do is have a [Code of Civil Procedure section 917.9] undertaking, your honor.”
The rulings on the objections to the bond
The Bank’s motion was granted. The ensuing minute order, in relevant part, stated that “[p]ursuant to section 917.9, Code of Civil Procedure, the court finds that the $1,000,000.00 bond regarding the real property is sufficient. Pursuant to section 917.1, Code of Civil Procedure, the court orders an additional bond be posted in the total amount of $2,624, 00.00.”
We have been informed that real property was not at issue. It is likely that Judge Levanas was referring to personal property in Jerry’s possession.
Subsequently, Judge Levanas signed an order prepared by the Bank. In that order, Judge Levanas ruled “that the appeal bond filed by [Jerry]... is insufficient.” The order also stated: “The court finds that in addition to the $1,000,000.00 undertaking ordered per [Code of Civil Procedure, section 917.9], the court orders an additional undertaking, in the total amount of $2,624,000.” Jerry was ordered to obtain the bond from a corporate surety.
Jerry did not post an additional bond. He appealed Judge Johnson’s judgment and we affirmed in all respects.
Events and proceedings related to Jerry’s appeal of the order nullifying transfers of personal property to Michael; Judge Aviva K. Bobb’s rulings
Partial satisfaction of Judge Johnson’s judgment
Jerry sold certain collectibles and delivered $656,000 to the Bank. However, Jerry never paid the money portion of the judgment for $1,638,000. When the Bank tried to collect, he stated that he had transferred his assets-other collectibles such as motorcycles, bicycles, and lamps-to Michael.
The Bank’s petition to nullify transfers
On November 30, 2006, the Bank filed a petition to nullify the transfer of personal property and recover it (nullification petition). The nullification petition alleged that the personal property was acquired with proceeds from the Primary Trust, and the transfer of the personal property to Michael was void.
The nullification petition sought an order (1) determining the assignment of personal property null and void; (2) confirming the existence of the Primary Trust over the personal property; (3) determining that the Bank was entitled to possession of the personal property held or claimed by Michael; and (4) directing Michael to deliver the personal property to the Bank.
Attached to the nullification petition was a purported June 16, 1994, agreement that was handwritten by Jerry and signed by Jerry and Michael (gift assignment). The gift assignment stated: “I Jerry De Mille and my son Michael D. De Mille have agreed on a contract between ourselves stating that when [Michael] reach[es] 30 years of age on 10-29-05[, ] if he is not in the criminal justice system and is living a clean life[-]no drugs, illegitimate children, or something I would not approve of[-]I[, ] Jerry De Mille[, ] will pass on ownership of all motor vehicles, motorcycles, bicycles, and related memorabilia I will have accumulated by then to [Michael]. The value of my son achieving this at 30 years of age is well worth it to me for the value of these mere possessions. [¶] This agreement is virtually the same as [Michael’s] mother set up in her trust Jan[uary] 1, 1994, that everything she had would go to [Michael] when he reached 30 [years of age] also with some restrictions required.”
In Jerry and Michael’s objections to the nullification petition, they stated in part: “Since October 29, 2005, the property has been in the possession of [Michael’s] grandfather [Horace] and held for [Michael]... on real property owned by [Horace] in North Hollywood.”
The stipulated facts
Prior to trial, the parties signed a joint trial statement. The parties listed the June 16, 1994, agreement as an exhibit that would be received without objection and they stipulated to certain facts, including stipulation No. 4: “The purported gift assignment instrument was written by [Jerry] on June 16, 1994.”
The parties also stipulated: Jerry sold the personal property purchased before David’s death and delivered $656,000 to the Bank. Jerry did not pay the monetary judgment against him for $1,683,000. The transfer of personal property was of substantially all of Jerry’s assets. He was insolvent as of February 23, 2006, the date the judgment for the Bank was entered. As of October 29, 2005, the collective value of the personal property allegedly transferred to Michael was worth at least $200,000. The personal property was never physically delivered to Michael by Jerry. Michael has resided in the State of Washington from 1996 through the present. At all times, the personal property has remained on two adjoining properties in North Hollywood and the two adjoining properties were owned by Horace. Michael has never permanently resided at Horace’s properties. Jerry has continuously resided at Horace’s properties from 2001 through the present. Further, Jerry resides in a room within Horace’s properties where the personal property is located. At no time did Jerry receive any money from Michael in exchange for the personal property.
Trial on the nullification petition
At trial, the parties disputed what they meant by stipulation No. 4. The Bank’s attorney argued that the stipulation was entered into because Jerry and Michael would testify “that they signed the document in June of 1994. Rather than belabor the point, we agreed to that. But the purported [word] is included in [stipulation] No. 4.” Jerry and Michael’s attorney stated that “the purported is, that it’s purported to be an agreement. But the fact is, there’s a stipulation of fact in our joint trial statement that that particular document was signed in June 1994.”
Jerry testified: He prepared and signed the gift assignment in 1994. He transferred personal property to Michael long before he turned 30 years old on October 29, 2005. The personal property was held by Horace for Michael. Jerry waited until March 29, 2006, before going to the Department of Motor Vehicles (DMV) to register Michael as the lien holder on eight vehicles. To maintain insurance, Jerry registered himself as the owner. In the defense case, Jerry testified that over the years he gave Michael “automotive and bicycle stuff.” Jerry first gave Michael an automobile in 1983, when Michael was eight years old. Jerry was asked if he did anything to symbolize his gifts to Michael over the years. Jerry testified: “Just to tell him that this was his and-or show him [t]hat I was working on more stuff for him, kind of an update.” In addition, Jerry stamped Michael’s name on each gift. Jerry told Michael and his friends that the personal property belonged to Michael. On his own, Michael collected Star Wars items, comic books and musical instruments. To store all his personal property, Michael would need about 8, 000 square feet. If he had to rent storage space, it would cost $5,000 a month. Horace, however, did not charge Michael a fee for storage.
Jerry testified that, with Michael’s permission, he was using a 2001 Chevrolet pickup truck that he previously gave to Michael. According to Jerry, he does not own any vehicles. The only reason Jerry was still the registered owner of all the vehicles was because Michael had only been in California a couple of months and did not have time to process the paperwork.
On cross-examination, Jerry stated that he helped with Horace’s finances. Jerry was asked if Horace, who was 89 years old, was incompetent. Jerry thought the word “incompetent” was too harsh. However, he conceded that when Horace was deposed on May 17, 2005, he did not know his date of birth, the current date or recognize Jerry. Also, Horace did not know Vikram Brar (Brar), the attorney representing him at the deposition. Jerry said it was possible that Horace did not know who Michael was. But then Jerry said Horace did not have any big memory problems and was not in a conservatorship. Further, after May 17, 2005, Horace knew who Jerry and Brar were.
Michael was the next to testify. He signed the gift assignment in 1994 and later lost the original. He spoke to Jerry about the gift assignment sometime around October 29, 2005, and asked what the plan was. Michael did not remember what Jerry said. Michael never had physical possession of the personal property. Also, he never received an itemization of the personal property. But he did receive pictures. He moved from Washington to Horace’s adjoining properties in North Hollywood in April 2007. None of the vehicles at issue were registered to Michael, but he was the owner. He did not know the value of the personal property, where he was registered to vote, or whether he had paid any taxes on the personal property. He showed the personal property to some of his friends and told them it was his.
Michael’s testimony contradicted his stipulation that he resided in the State of Washington from 1996 to present. The joint trial statement containing the stipulated facts was signed by Michael’s attorney on May 11, 2007.
Michael testified that his current driver’s license was from Washington. When asked to state his occupation, he testified that he was self-employed and that he had started a record label.
One of Jerry’s friends and several of Michael’s friends testified that Michael was the owner of the personal property.
After the witnesses were called, Judge Bobb stated that she was receiving into evidence Judge Johnson’s finding that Jerry committed two acts of forgery because it was relevant under Evidence Code section 1101 to prove motive, intent and a common plan to act in a certain manner.
The statement of decision
Judge Bobb issued a statement of decision and found that the gift assignment was not written by Jerry on June 16, 1994. Rather, it was written sometime after Groves filed her recovery and damages petition on June 27, 2005. The gift assignment and transfer of personal property from Jerry to Michael reflected a continuing course of fraudulent conduct that Jerry employed to the detriment of the Bank, the Primary Trust and its beneficiaries. Jerry’s acts of forgery on the power of appointment and specific gift designation, as detailed in Judge Johnson’s statement of decision, proved a common plan and intent to defraud the Bank and the beneficiaries of the Primary Trust. Despite the gift assignment and alleged transfer, Jerry never relinquished possession or control over any of the personal property.
Judge Bobb found that the gift assignment was void pursuant to Civil Code section 3440 because it constituted a purported transfer of personal property in Jerry’s possession not accompanied by an immediate delivery followed by an actual change of possession of the personal property. Next, Judge Bobb found that the gift assignment was void under Civil Code section 3439.04, subdivision (a)(1) because the purpose of the alleged transfer was to hinder, delay or defraud the Bank. Finally, she found that the transfer was void under Civil Code section 3439.04, subdivision (a)(2) because it was made without Michael providing equivalent value in return.
The judgment
Judge Bobb signed an order and judgment after trial decreeing that the gift assignment was null and void; the alleged transfer of specified personal property was fraudulent under Civil Code sections 3440 and 3439.04, subdivision (a)(1) and (2); Jerry remained the owner of the personal property; Jerry and Michael and their agents were enjoined from disposing of the personal property; and the personal property was worth a minimum of $354,825 as of October 29, 2005.
Michael’s motion challenging the judgment
Michael moved Judge Bobb to vacate the judgment and grant a new trial on the grounds that stipulation No. 4 established that the gift assignment was written in 1994, Judge Johnson’s prior findings of forgery were irrelevant to the nullification petition, and the valuation of the personal property was not supported by the evidence or law. If the probate court did not vacate the judgment and grant a new trial, Michael asked the probate court to reopen the case for a further trial on stipulation No. 4 and the valuation of personal property.
The rulings on Michael’s motion
Judge Bobb denied the motion to vacate the judgment and grant a new trial, indicating that she would have ruled the same without the prior findings of forgery. However, she granted the motion to reopen the case as to the gift assignment and valuation.
Judge Bobb heard argument and took the matter under submission. On July 3, 2008, she ruled that the gift assignment was void under Civil Code sections 3440 and 3439.04, subdivision (a) because Jerry never delivered the personal property to Michael, Jerry retained possession, Michael did not pay equivalent consideration, the transfer was not disclosed to the Bank and the gift assignment was not executed until after Groves filed the recovery and damages petition.
Jerry appealed.
Proceedings related to Michael’s appeal of the judgment enforcing liability on Horace’s bond; Judge Bobb’s ruling
The Bank filed a motion to enforce liability on Horace’s bond because Jerry did not pay the judgment against him for $1,683,000. In opposition, Jerry and Horace argued that the Bank was equitably estopped from enforcing the bond because it previously argued that Horace was incompetent and that the bond was therefore insufficient; Horace’s bond expired when Jerry failed to post an additional bond; and the bond was exonerated when Jerry transferred the real property to the Bank in May or June 2006. In its reply, the Bank argued that it was not equitably estopped to enforce liability on Horace’s bond because Jerry did not rely on the Bank’s claim that Horace was incompetent; Horace’s bond was in effect for all liabilities incurred before its expiration; the bond was posted to insure the monetary judgment of $1,683,000, not some unidentified real property.
At oral argument, Jerry’s attorney stated that “the bond that was posted was never in effect, which is, it was considered to be ineffective from the very beginning, insufficient from the very beginning.”
Judge Bobb granted the Bank’s motion to enforce Horace’s bond in the sum of $1,017,505.84 and entered judgment.
Jerry appealed.
STANDARD OF REVIEW
We review statutory interpretation and the application of a statute to undisputed facts on an independent basis. (Eidsmore v. RBB, Inc. (1994) 25 Cal.App.4th 189, 195; Garamendi v. Mission Ins. Co. (2005) 131 Cal.App.4th 30, 40.) If the facts are disputed, we review factual findings for substantial evidence. (Romo v. Ford Motor Co. (2002) 99 Cal.App.4th 1115, 1139.) When applying the substantial evidence test, we resolve all conflicts in the evidence and draw all reasonable inferences in a manner that upholds the verdict. (Holmes v. Lerner (1999) 74 Cal.App.4th 442, 445.) “Inferences may constitute substantial evidence, but they must be the product of logic and reason. Speculation or conjecture alone is not substantial evidence.” (Roddenberry v. Roddenberry (1996) 44 Cal.App.4th 634, 651.)
DISCUSSION
I. Appeal of the judgment on the nullification petition.
Jerry argues: (1) the parties and Judge Bobb were bound by the stipulated facts and it was error for Judge Bobb to admit evidence that contradicted the stipulated facts or render a decision in derogation of the stipulated facts; (2) Judge Bobb improperly took judicial notice of the record; (3) Judge Bobb’s decision to admit the findings of fact of Judge Johnson into evidence constituted error; and (4) there was insufficient evidence to support the judgment.
We find no basis to reverse.
A. Judge Bobb’s decision did not contradict stipulation No. 4.
The parties’ attorneys stipulated that the “purported” gift assignment was written by Jerry on June 16, 1994. “Unless the trial court, in its discretion, permits a party to withdraw from a stipulation [citations], it is conclusive upon the parties, and the truth of the facts contained therein cannot be contradicted. [Citations.]” (Palmer v. City of Long Beach (1948) 33 Cal.2d 134, 141–142.) “[A] a stipulation in proper form is binding upon a court unless it is contrary to law, court rule, or public policy. [Citations.]” (Glade v. Superior Court (1978) 76 Cal.App.3d 738, 744.)
In her statement of decision, Judge Bobb found that the gift assignment was not written by Jerry until after June 27, 2005. But then she reopened the case for further argument regarding stipulation No. 4. In her July 3, 2008, ruling, Judge Bobb merely stated that the gift assignment was not executed until after Groves filed the recovery and damages petition. As stated in Black’s Law Dictionary, an “executed contract” is a “[c]ontract which has been fully performed by the parties.” (Black’s Law Dict. (6th ed. 1990) at p. 567, col. 2.) The upshot is that she ruled that the gift assignment was not fully performed until after June 27, 2005. Stipulation No. 4 established when the gift assignment was prepared, not when it was performed. Thus, Judge Bobb’s ruling did not transgress the law. Even if it had, the error would have been harmless. As we discuss in part I.C. of the Discussion, post, the evidence established that Michael did not receive actual delivery of the personal property and therefore the transfer was void as to the Bank pursuant to Civil Code section 3440.
B. Jerry failed to establish that Judge Bobb’s decision to take judicial notice of the record requires reversal.
Jerry complains that Judge Bobb took judicial notice of the record even though neither party asked her to. We note that a trial court has the discretion to take judicial notice of the official acts of any federal or state court and the records of any federal or state court. (Evid. Code, § 452, subds. (c) & (d).) In fact, one of the cases cited by Jerry in his opening, Estate of Russell (1971) 17 Cal.App.3d 758, 765 (Estate of Russell), is on point. Estate of Russell explained that a court may “take judicial notice of such court records, even when not requested to do so.” (Ibid.) If Judge Bobb took judicial notice without a request, it was permissible.
Transitioning to a different point, Jerry argues that Judge Bobb erred when she impliedly took judicial notice of the truth of Judge Johnson’s finding that Jerry forged the specific gift designation and power of appointment. It is true, as Jerry points out, that a court is prohibited from taking judicial notice of the truth of factual findings. (Sosinsky v. Grant (1994) 6 Cal.App.4th 1548, 1568–1569 (Sosinsky).) We therefore assume for the sake of argument that Jerry is correct and that Sosinsky barred Judge Bobb from considering the two acts of forgery. But, as we discuss, the presence of error does not by itself mandate a reversal.
Article VI, section 13 of the California Constitution. Section 13 provides in part that “[n]o judgment shall be set aside... on the ground of... the improper admission or rejection of evidence... unless, after an examination of the entire cause, including the evidence, the court shall be of the opinion that the error complained of has resulted in a miscarriage of justice.” (Cal. Const., art. VI, § 13.) In other words, Jerry must establish a reasonable probability that without the error he would have prevailed. (Soule v. General Motors Corp. (1994) 8 Cal.4th 548, 574.) Because Jerry does not argue that there was a miscarriage of justice, we need not toil longer on this subject. (Tan v. California Fed. Sav. & Loan Assn. (1983) 140 Cal.App.3d 800, 811 [arguments not made are deemed waived].) It bears highlighting, however, that Judge Bobb indicated several times that she would have found against Jerry and Michael even if Judge Johnson’s findings were not considered. Going one step further, we presume that Judge Bobb, if requested, could have simply ruled that collateral estoppel barred Jerry from denying the forgeries. In the end, this speculation is moot because the forgeries were not relevant to Judge Bobb’s finding that Jerry retained possession of the personal property for purposes of section 3440.
Next, Jerry points out that Judge Bobb noted that the files were replete with references to Jerry being the owner of motorcycles and vehicles. Then Jerry states: “The court came to realize that whatever ‘information’ it was relying upon pertained to property that was not in issue. The fact the court was unable to make use of what was learned from that one particular ‘investigation’ certainly does not do much to instill confidence that the court did not make a similar ‘investigation’ regarding the issues that it was asked to resolve. The very notion that the court was giving consideration to matters that had not been disclosed to the parties and as to which no opportunity was given to respond or present counterveiling evidence does substantial damage to the perception of impartiality, fairness and recognition of the parties’ due process rights.” In our view, this attack on Judge Bobb and her ruling is speculative, unprofessional and unappreciated. Further, Jerry cites no law establishing that his musings about a phantom decision to take judicial notice support a reversal. Thus, this specific argument is waived. (Sprague v. Equifax, Inc. (1985) 166 Cal.App.3d 1012, 1050 [if a brief does not contain citation to legal authority supporting the points made, the reviewing court may deem the argument abandoned].)
In a similar vein, Jerry contends that “it is clear that the court, at the repeated urgings of the Bank’s counsel, took judicial notice not only of what documents were in its files, but also factual matters contained in those documents. Even if the court had been asked and agreed to take judicial notice of what was in its files, it would have been improper for the court to take notice of and accept as true those ‘facts’ purportedly ‘found’ by Judge Johnson and which were used in rendering a decision.” Other than the findings regarding forgery, we are left wondering what documents and facts Judge Bobb supposedly took judicial notice of. Without being cited to any specific rulings, there is nothing for us to review.
C. The judgment was supported by substantial evidence.
Civil Code section 3440, subdivision (a) provides: “Except as otherwise provided in this chapter, every transfer of personal property made by a person having at the time the possession of the property, and not accompanied by an immediate delivery followed by an actual and continued change of possession of the property, is void as against the transferor’s creditors (secured or unsecured) at the time of the transfer and those who become creditors while the transferor remains in possession and the successors in interest of those creditors.” A creditor is a person defined by Civil Code section 3439.01. (Civ. Code, § 3440, subd. (b).) Under Civil Code section 3439.01, subdivision (c), a creditor is a person with a claim. A claim “means a right to payment, whether or not the right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured.” (Civ. Code, § 3439.01, subd. (b).)
“The delivery required by [section 3440] must be immediate, actual, physical, apparent, and the change of possession must be that which is usual and reasonably to be expected under the circumstances. The transferee’s possession must be continued and so open and unequivocal as to carry with it the usual marks and indicia of ownership. [Citations.]” (Raddatz v. Hedgpeth (1963) 223 Cal.App.2d 633, 636–637.) Significantly, delivery cannot be constructive. (Dot Records, Inc. v. Freeman (1966) 247 Cal.App.2d 204, 207 (Dot Records).) Whether the transferor and transferee exchanged consideration and acted in good faith “‘is wholly immaterial and is no defense where the facts bring the case within [section 3440]... and there has been no immediate and continued change of possession.’ [Citation.]” (Id. at p. 206.)
The issue is whether there is substantial evidence that the Primary Trust became Jerry’s creditor while he remained in possession of the personal property. There is. As soon as Jerry misappropriated assets from the Primary Trust, it had a claim even though that claim was not reduced to a judgment. And certainly the Primary Trust became a creditor when Groves filed the recovery and damages petition on June 27, 2005. The stipulated facts established that “[t]he [s]ubject [p]ersonal [p]roperty has never been physically delivered to... Michael by... Jerry.” Michael resided in the State of Washington “from 1996 through the present, ” and has never permanently resided on Horace’s properties. Jerry, on the other hand, has continuously resided on Horace’s properties “from 2001 through the present.” Moreover, the parties stipulated that “Jerry resides in a room within [Horace’s properties] where the [s]ubject [p]ersonal [p]roperty is and remains located, ” and that Michael never paid Jerry any money for the personal property.
These facts establish that there was no physical delivery or change of possession. If there was delivery, it was merely constructive, which does not avoid the statute. Nothing about the purported delivery was apparent because the personal property remained at Jerry’s residence. Though Jerry claims that Michael has possession of the personal property because it was being held by Horace for Michael, the inferences are contrary. The personal property remained located at Jerry’s residence, which suggests Jerry retained possession. Horace was elderly, frail and forgetful, and Jerry helped Horace with his finances. Inferably, Horace was dependent upon Jerry and the claim that Horace had possession is a fiction, especially since evidence of title documents being generated or changing hands is absent.
Jerry never specifically argues in his opening brief that there is insufficient evidence to support a judgment under Civil Code section 3440. Rather, he argues: “When exorcised of its incompetent and inadmissible ‘evidence, ’ little remains of the Bank’s evidence that served to support the court’s decision. While much evidence was presented by Jerry and Michael, the Bank’s evidence was limited to the DMV registrations by which Jerry was shown as the registered owner, and Michael as the legal owner or lienholder. But how that evidence was perceived and the weight given to it necessarily was influence by the inadmissible evidence of ‘bad character’ acts. [¶] While the trier of fact is not required to accept the testimony of any lay witness, an obligation does exist to not arbitrarily refuse to give credence to a witness’ testimony. Because of the extensive reliance by the [probate court] on inadmissible character evidence, it is difficult, if not virtually impossible, to know how the [probate court] would have ruled in the absence of such ‘bad character’ evidence. Jerry and Michael ought to be given the opportunity to have all the admissible evidence considered by a trier of fact who has not been exposed to highly prejudicial and inadmissible ‘evidence.’” (Fn. omitted.)
This argument is unavailing because it fails to explain why the evidence and stipulated facts were insufficient to support a finding that that the personal property was never physically delivered, or to support a finding that there was never a continuing change of possession of the personal property.
In his reply, Jerry argues that constructive delivery is sufficient to avoid the impact of Civil Code section 3440. We deem this tardy argument waived. (Hepner v. Franchise Tax Bd. (1997) 52 Cal.App.4th 1475, 1486.) Academically, we note that Jerry cited Bank of America v. Cottrell (1962) 201 Cal.App.2d 361, 363 [a gift can be complete with, among other things, “delivery, either actual or symbolical”] and a host of other cases bearing up the general law of gifts. There is no dispute, as Jerry argues, that a gift can be completed with constructive delivery. But the issue presented is whether the gifts, completed or not, are void as to creditors. None of the cases cited by Jerry reach that issue. These cases, therefore, are inapposite and we have no reason to depart from the precedent in Dot Records.
All other issues are moot.
II. Appeal of the judgment enforcing Horace’s liability on the bond.
Jerry and Michael argue: (1) the bond was void from the inception because there was only one personal surety; (2) the judgment enforcing liability on the bond is void because it arose from a void order reconsidering Judge Johnson’s prior order in violation of Code of Civil Procedure section 1008; (3) if the bond was effective, it ceased being effective five days after the Judge Levanas determined that it was deficient; (4) the bond was filed under Code of Civil Procedure section 917.9 and cannot be used to impose liability under Code of Civil Procedure section 917.1; (5) the Bank is judicially estopped from making any claim against the bond; (6) Judge Levanas had no power to increase the bond once it was filed; and (7) Judge Levanas had no power to change the judgment issued by Judge Johnson.
Due to a substitution of parties, this appeal is being pursued by Michael alone. But the appeal was filed by Jerry and Jerry filed an opening brief even though he lacked standing. Michael filed his own opening brief and also joined in Jerry’s arguments. To make clear that we have considered both briefs, we refer to the arguments advanced by both Jerry and Michael.
Upon review, we conclude that the judgment must stand.
A. Even if the bond had technical defects, Horace was not absolved of liability.
Jerry and Michael start off by arguing that the bond was void from the inception because there was only one surety. In essence, they suggest that if the bond was defective, Horace cannot be held liable.
Unless a statute dictates a different time, a bond becomes effective at the time it is given “or, if the statute requires that the bond be approved, at the time it is approved.” (Code Civ. Proc., § 995.420, subd. (a).) Moreover, a “bond shall be executed by two or more sufficient personal sureties or by one sufficient admitted surety insurer or by any combination of sufficient personal sureties and admitted surety insurers.” (Code Civ. Proc., § 995.310.)
What happens if a bond does not comply with Code of Civil Procedure section 995.310? In order to answer the question, we turn to the statutory scheme. In doing so, we “begin by examining the statute’s words, giving them a plain and commonsense meaning. [Citation.] We do not, however, consider the statutory language ‘in isolation.’ [Citation.] Rather, we look to ‘the entire substance of the statute... in order to determine the scope and purpose of the provision.... [Citation.]’ [Citation.]... We must harmonize ‘the various parts of a statutory enactment... by considering the particular clause or section in the context of the statutory framework as a whole.’ [Citations.]” (People v. Murphy (2001) 25 Cal.4th 136, 142.)
By its plain language, Code of Civil Procedure section 995.380 preserves a surety’s liability even if a bond is defective. It provides: “(a) If a bond does not contain the substantial matter or conditions required by this chapter or by the statute providing for the bond, or if there are any defects in the giving or filing of the bond, the bond is not void so as to release the principal and sureties from liability. [¶] (b) The beneficiary may, in proceedings to enforce the liability on the bond, suggest the defect in the bond, or its giving or filing, and enforce the liability against the principal and the persons who intended to become and were included as sureties on the bond.” (Code Civ. Proc., § 995.380 (a) & (b).) Based on this statute, there is no doubt that Horace was liable on the bond even if it was defective.
In support of a contrary view, Jerry cites Howland v. Scott (1932) 215 Cal. 301, 305 (Howland) [a bond deficient in form is void and “never has the effect of staying an execution”]. Jerry’s reliance on Howland was waived because it was not cited below. (Santantonio v. Westinghouse Broadcasting Co. (1994) 25 Cal.App.4th 102, 113.) Notably, Jerry did not argue that the bond was void from the inception in his opposition papers. Rather, at oral argument, his attorney stated that Horace’s bond was never in effect but cited no authority.
Our analysis could end here.
We note that Howland did not interpret the current Bond and Undertaking Law (Code Civ. Proc., § 995.010 et seq.), which was enacted by the Legislature in 1982. (Snyder v. United States Fidelity & Guaranty Co. (1997) 60 Cal.App.4th 561, 566.) Cases are not authority for issues not decided. (Santisas v. Goodin (1998) 17 Cal.4th 599, 620.) Also, pivotally, Howland merely recognized law holding that a deficient bond does not stay execution of a judgment. The court did not state that a defective bond automatically eliminates liability for a surety.
Michael argues that “[a] bond that is not given as provided by statute is void, and the surety is not liable” and cites De Garmo v. Superior Court (1934) 1 Cal.2d 83, 85 (De Garmo) and Reay v. Butler (1897) 118 Cal. 113, 115 (Reay). But neither case interpreted the current Bond and Undertaking Law. De Garmo involved a petition for writ of mandate to secure a writ of execution and reverse an order approving a bond. The court held that the bond was deficient and therefore the defendant was not entitled to a stay of execution. (De Garmo, supra, 1 Cal.2d at p. 85.) Thus, De Garmo is off point, just like Howland. Reay, on the other hand, would be on point if it was decided in 1997 instead of 1897, for it involved a challenge to a judgment on a bond. The Reay court held that “as the bond is ineffectual as a stay because made in a case not provided by the statute, the consent of the sureties to summary judgment against themselves is likewise ineffectual.” (Reay, supra, 118 Cal. at p. 115.) But we would be remiss if we failed to mention that though the Reay court reversed the judgment against the sureties due to a defect in the bond, it stated that “[o]ur inclination would be to recommend affirmance [because the sureties agreed to liability] if we could do so consistently with legal reason.” (Ibid.) That, of course, was in 1897. In 2010, we impose liability based on Code of Civil Procedure section 995.380.
Despite the enactment of the Bond and Undertaking Law in 1982, Michael argues that Horace’s bond was still a nullity from its inception and cannot serve as a basis for imposing liability on him as a surety. As authority, Michael cites an article from the June 28, 2005, edition of L.A. Lawyer from the Los Angeles County Bar Association. Under the heading “The Enduring Nature of the Bond Obligation, ” the article stated: “Two recent cases-Conservatorship of O’Connor [(1996) 48 Cal.App.4th 1076] and Lewin v. Anselmo [(1997) 56 Cal.App.4th 694]-make clear that once an appeal bond has been given by a surety, the resulting obligations cannot easily be set aside. In Conservatorship of O’Connor, the administrator of an estate appealed a judgment that rescinded a performance bond. On appeal, the surety argued that rescission of the bond was appropriate in part because the bond had never been filed or approved by the court and therefore had never become effective. [¶] The [C]ourt of [A]ppeal refused to release the surety from liability because neither filing nor approval of the bond was consideration for issuance of the bond. Instead, the court held that once the bond premium was paid, a technical defect such as failure to file or obtain approval did not affect the validity of the bond. In reaching this conclusion, the court cited the ‘savings’ clause in Code of Civil Procedure Section 995.380, [subdivision (a)] that forgives technical errors or mistakes: [¶] If a bond does not contain the substantial matter or conditions required by this chapter or by the statute providing for the bond, or if there are any defects in the giving or filing of the bond, the bond is not void so as to release the principal and sureties from liability. [¶] In Lewin [v. Anselmo], two individuals agreed to give a personal surety bond to stay enforcement of a judgment pending the defendants’ appeal, but the agreement gave the sureties 15 days to rescind. The sureties rescinded within the 15-day period, and the judgment was then affirmed on appeal. The plaintiff, who had not been informed about the 15-day rescission period, made a motion to enforce the personal sureties’ liability. The trial court ruled in favor of the sureties, and the plaintiff appealed. [¶] The [C]ourt of [A]ppeal reversed, holding that the 15-day rescission period had to be disregarded because, if enforced, it could prevent the bond from taking effect for 15 days, in violation of the statutory directive that ‘“a bond is effective at the time it is given.’” The court also invalidated the 15-day rescission period because it conflicted with Code of Civil Procedure Section 996.110, which requires a court determination to release any surety from liability on a bond, noting: ‘These statutory procedures are more than mere formalities.... As [the sureties] did not comply with these procedures, ... [they] were not released from liability on their bond....’” (Axelrad, The Statutory Framework for Appeals Bonds (2005) 28 L.A. Lawyer 16, fns. omitted.)
According to Michael, the article establishes that “[t]he ‘savings’ clause in [Code of Civil Procedure section] 995.380 serves to ‘forgive technical errors or mistakes’ and was not intended to be a ‘life saver’ of bonds that are fundamentally deficient from inception.” We read the article differently. It mentions nothing about fundamentally deficient bonds, nor does it define what it refers to as technical errors and mistakes. In our view, the article supports our conclusion that a bond with one personal surety instead of two personal sureties still supports liability of the one personal surety. In other words, for purposes of liability, the defect is only technical. We therefore decline to apply Reay.
B. The judgment enforcing liability on the bond is not void.
Jerry and Michael contend that Judge Lavanas had no jurisdiction under Code of Civil Procedure section 1008 to reconsider and change Judge Johnson’s prior order. Based on this contention, they argue that the judgment is void because it was premised on what amounted to a void reconsideration order. This argument is being asserted for the first time on appeal and is waived. To permit a party to raise a new issue that was not raised in the trial court would not only be unfair to the trial court, but manifestly unjust to the opposing party. (North Coast Business Park v. Nielsen Construction Co. (1993) 17 Cal.App.4th 22, 29.)
Code of Civil Procedure section 1008, subdivision (a) provides in relevant part: “When an application for an order has been made to a judge, or to a court, and refused in whole or in part, or granted, or granted conditionally, or on terms, any party affected by the order may, within 10 days after service upon the party of written notice of entry of the order and based upon new or different facts, circumstances, or law, make application to the same judge or court that made the order, to reconsider the matter and modify, amend, or revoke the prior order.” Code of Civil Procedure section 1008, subdivision (e) provides: “This section specifies the court’s jurisdiction with regard to applications for reconsideration of its orders.”
Academically speaking, Jerry and Michael’s position is unavailing.
Jerry and Michael’s attack is based upon the presupposition that Judge Levanas unwound Judge Johnson’s order requiring that Jerry post a $1 million bond. But that never happened. All Judge Levanas did was order Jerry to provide an original bond under Code of Civil Procedure section 917.1, an order that was superfluous because that statute, by operation of law, already required a bond and set the amount. The ruling left Judge Johnson’s order intact regarding the necessity and amount of a bond under Code of Civil Procedure section 917.9. As a result, the judgment was based on Judge Johnson’s order, not Judge Levanas’s order.
C. The five-day rule did not eliminate Horace’s liability.
Jerry argues that Horace’s bond became a nullity five days after Judge Levanas’s ruling because Jerry did not post an additional bond. This is incorrect.
If a court determines that a bond is insufficient, “[t]he court shall specify in what respect the bond is insufficient and shall order that a bond with sufficient sureties and in a sufficient amount be given within five days. If a sufficient bond is not given within the time required by the court order, all rights obtained by giving the bond immediately cease and the court shall upon ex parte motion so order.” (Code Civ. Proc., § 995.960, subd. (b)(1).)
Judge Levanas issued conflicting orders. His minute order ruled that Horace’s bond was sufficient. But the subsequent order, prepared by the Bank and signed by Judge Levanas, stated that Horace’s bond was insufficient. This confusion, however, does not impact our analysis. Horace’s bond was not insufficient in amount because Code of Civil Procedure section 917.9 gave Judge Johnson the discretion to set the amount as she deemed fit. Further, Judge Levanas declined to rule that Horace’s bond was insufficient due to the number of sureties or Horace not being a qualified surety. And Judge Levanas did not order Horace’s bond replaced. We conclude that the five-day rule was not triggered.
D. Jerry and Michael failed to establish that Horace’s bond was unavailable to satisfy the money judgment.
Jerry and Michael argue that the bond was filed under Code of Civil Procedure section 917.9 [bond to stay enforcement of a judgment in which the appellant was found to be in possession of property belonging to the respondent] and cannot be used to pay obligations that are covered by Code of Civil Procedure section 917.1 [bond to stay enforcement of a money judgment]. This argument was not advanced below. We therefore have no obligation to consider it.
To be complete, we examine the merits. Jerry argues that Code of Civil Procedure section 917.6 makes it clear that a bond given under one statute cannot be used to satisfy an obligation under another statute. The statute provides: “The perfecting of an appeal shall not stay enforcement of the judgment or order in the trial court if the judgment or order appealed from directs the performance of two or more of the acts specified in Sections 917.1 through 917.5, unless the appellant complies with the requirements of each applicable section.” (Code Civ. Proc., § 917.6.) The statute does not prohibit the enforcement of liability on a bond given under Code of Civil Procedure section 917.9 when an appellant fails to pay a money judgment that was subject to Code of Civil Procedure section 917.1.
Jerry adverts to Biagi v. Howes (1883) 63 Cal. 384, but we conclude that it is inapposite. The appellant filed a notice of appeal from a judgment and a separate notice of appeal from the denial of his motion for new trial. Though required to file an undertaking within five days of the appeal of the judgment, the appellant did not and his first appeal was considered a nullity. (Ibid.) Nor do we find answers in the citations provided by Michael. He first cites to Central L&M Co. v. Center (1895) 107 Cal. 193. But page 193 only contains the counsel listing and other information. The opinion does not begin until page 194. We therefore do not know what part of the opinion Michael wishes for us to read. Next, he cites Fidelity & Casualty Co. v. Superior Court (1934) 139 Cal.App. 615. Because no pinpoint cite is provided, and the opinion begins on page 616, we have the same problem. On top of these argumentative defects, neither case interpreted Code of Civil Procedure sections 917.1 and 917.9 for the simple reason that they were not enacted until 1968.
E. The judicial estoppel argument was waived.
Jerry and Michael argue that the Bank’s motion to enforce liability on the bond was barred by judicial estoppel. Below, however, Jerry argued equitable estoppel. The two doctrines are wholly separate and we will not entertain this newly minted argument for the first time on appeal.
DISPOSITION
The judgments are affirmed.
The Bank shall recover its costs on appeal.
We concur DOI TODD, Acting P. J., CHAVEZ J,