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In re Marriage of Earls

California Court of Appeals, Sixth District
Nov 21, 2008
No. H031582 (Cal. Ct. App. Nov. 21, 2008)

Opinion


In re the Marriage of MARI-LYNNE EARLS and CARLTON G. AMDAHL. MARI-LYNNE EARLS Appellant, v. CARLTON G. AMDAHL, Respondent. H031582 California Court of Appeal, Sixth District November 21, 2008

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

Santa Clara County Super. Ct. No. FL027294

Bamattre-Manoukian, J.

I. INTRODUCTION

Appellant Mari-Lynne Earls challenges four trial court orders in this marital dissolution action, including (1) the March 25, 2007 order denying her motion to set aside the August 14, 2003 dismissal order and the March 21, 2003 stipulated judgment; (2) the March 25, 2007 child support order; (3) the June 12, 2007 order awarding respondent Carlton G. Amdahl discovery-related attorney fees of $60,000 pursuant to Family Code section 271; and (4) the June 12, 2007 order awarding Amdahl attorney fees of $225,000 pursuant to section 271, due to Earls’ unwillingness to make or consider reasonable settlement offers to resolve the litigation.

All further statutory references are to the Family Code unless otherwise indicated.

For the reasons stated below, we conclude that none of Earls’ claims of trial court error have merit and therefore we will affirm all four orders.

II. FACTUAL AND PROCEDURAL BACKGROUND

Earls and Amdahl were married on August 31, 1974, and have four children. Their youngest child, Jordan, was born in 1988. During the litigation of their marital dissolution action, the parties entered into a number of agreements that became either the judgment or the order of the court.

In his respondent’s brief, Amdahl states that Jordan was born in 1987, not 1988.

A. September 29, 1993 Judgment of Dissolution

On September 29, 1993, Earls and Amdahl entered into a judgment of dissolution that incorporated their August 31, 1993 marital settlement agreement.

B. March 21, 2003 Stipulated Judgment

Nearly 10 years later, the parties agreed to modify the September 29, 1993 judgment, as reflected in the March 21, 2003 “order on judicially supervised settlement” (hereafter, the March 21, 2003 stipulated judgment). The March 21, 2003, stipulated judgment included, among other things, the parties’ agreement that Amdahl would pay child support of $2,500 per month for Jordan, effective February 1, 2003.

A few months after entering into the March 21, 2003 stipulated judgment, Earls sought relief from the judgment. Her motion to set aside the March 21, 2003 stipulated judgment, filed June 2, 2003, asserted that she was entitled to relief from the judgment pursuant to section 2120 and Code of Civil Procedure section 473 because, through the mistake or inadvertence of either her prior attorney or herself, “she was not aware of the true circumstances surrounding the assets and income stream of [Amdahl]. In addition, [Earls] was under extreme pressure to ‘settle’ and not go to trial, pressure which at that time, she was unable to withstand.”

C. August 14, 2003 Dismissal Order

The trial court did not rule on Earls’ June 2, 2003 set aside motion because she subsequently filed a “request and order for dismissal” of the motion that was entered as an order of the court on August 14, 2003 (hereafter, the August 14, 2003 dismissal order).

The dismissal order incorporated the following stipulations by Earls: “1. This request for dismissal is ‘with prejudice’ and a motion to reconsider or set aside the previously entered Stipulated Judgment may never be brought by [Earls]. [¶] 2. The warranty expressed above is made in consideration of [Amdahl’s] agreement to bear his own fees and costs incurred to date in this matter. [Earls] shall bear her own fees and costs to date. [¶] 3. Each party shall bear all of his/her attorney’s fees for all attorneys with whom they have consulted, and whom they have retained, for all work done prior to the date of this stipulation and order. Neither party may file an action to recover fees and costs related to the motion to set aside or related to any collateral issue raised anticipatory to litigating the motion to set aside filed by [Earls]. [¶] 4. All terms and conditions of the Stipulated Judgment filed on March 21, 2003 remain in full force and effect.”

D. Earls’ January 18, 2005 Set Aside Motion

After retaining new counsel, Earls sought relief from her previous agreements. On January 18, 2005, she filed a motion to set aside the August 14, 2003 dismissal order; the March 21, 2003 stipulated judgment; and the September 28, 1993 judgment of dissolution.

As stated in her supporting declaration, the grounds for the set aside motion were fraud and duress. Earls claimed that she had entered into the March 21, 2003 stipulated judgment “based on [Amdahl’s] knowingly and intentionally false and fraudulent misrepresentations of his assets; and, further, because of the long-term effect of his distress and psychological abuse towards me.” Earls also stated that she became aware in July 2004 that Amdahl had failed to disclose certain assets.

As to the August 14, 2003 request and order for dismissal of her June 2, 2003 set aside motion, Earls asserted that “[a]t the time of my withdrawal [of the June 2, 2003 set aside motion] I was under attack from [Amdahl] who was continually threatening to sue me for malicious prosecution for the sole purpose of depleting my resources, as well as imposing sanctions for attorney fees.” Additionally, Earls stated, “The effect of [Amdahl’s] duress on my mental state was so onerous that I believed I had no other reasonable alternatives other than to succumb to his will. At that time, I was in a mentally weakened condition due to my anxiety and emotional anguish, mental and physical exhaustion to such a degree that I was unable to protect myself against [Amdahl’s] demands, and so intimidated that I was unable, until now, to take advantage of the legal advice that was available.”

However, Earls did not maintain her challenge to the September 29, 1993 judgment of dissolution that incorporated the parties’ marital settlement agreement. On August 18, 2005, she filed a “withdrawal without prejudice” of that part of her January 18, 2005 set aside motion that sought to set aside the September 29, 1993 judgment of dissolution. Thereafter, the parties litigated her motion to set aside the March 21, 2003 stipulated judgment and the August 14, 2003 dismissal order.

In his opposition memorandum of points and authorities filed on June 17, 2005, Amdahl argued that Earls’ set aside motion was time-barred under the time limits set forth in Code of Civil Procedure section 473 and section 2122. Amdahl also disputed Earls’ claims of fraud, contending that he had properly disclosed the facts about his assets.

E. Amdahl’s Motion to Quash and Dismiss Earls’ January 18, 2005 Set Aside Motion

On June 17, 2005, Amdahl filed a motion to quash and dismiss with prejudice Earls’ January 18, 2005 set aside motion and requested attorney fees.

In his supporting declarations, filed June 17, 2005, August 18, 2005, and September 7, 2005, Amdahl asserted that Earls’ claim that he had failed to disclose assets were meritless; Earls had stated inconsistent dates for her purported discovery of his nondisclosure; and Earls could not establish duress because, during the same time she claimed she was paralyzed by Amdahl’s duress, she had been able to sue her next door neighbors, retain attorneys, write threatening letters, sell property, and treat patients in her therapist practice.

F. Discovery Motions

While Earls’ January 18, 2005 motion to set aside the August 14, 2003 dismissal order and the March 21, 2003 stipulated judgment was pending, the parties also filed discovery motions.

On June 9, 2005, Amdahl filed a motion for an order compelling Earls to further respond to the special interrogatories that he had propounded concerning her claims of fraud, nondisclosed assets, and duress, and for an order awarding monetary sanctions. Amdahl filed a second discovery motion on October 12, 2005, in which he sought an order imposing evidence sanctions, issue preclusion, and monetary sanctions on Earls due to her failure to properly comply with his discovery demands.

On November 14, 2005, Earls filed a motion for a protective order, asserting that Amdahl’s oppressive and irrelevant discovery requests were intended to harass her and requesting an award of attorney fees. Amdahl opposed the motion.

G. Appointment of the Special Master

On October 13, 2005, the parties stipulated to the appointment of Commissioner John Schroeder as special master with the authority to determine all pending discovery matters; to preside over judicially supervised settlement discussions “relating to all issues pending before the Court,” subject to the stipulation delineating his powers; and to award non-monetary sanctions pursuant to the Code of Civil Procedure.

H. Special Master’s December 5, 2005 Report and Recommendations

The special master filed his first report of referee on December 5, 2005. The report indicated that the special master had met with the parties’ attorneys regarding outstanding discovery issues, including the issue of whether a further deposition of Amdahl should be permitted.

The special master recommended denial of the further deposition of Amdahl, his agents or attorneys, with regard to any acts prior to August 2003 unless the trial court granted Earls’ pending motion to set aside the August 14, 2003 dismissal order and March 21, 2003 stipulated judgment. This recommendation was based on the special master’s finding that the August 14, 2003 dismissal order was “ ‘with prejudice’ ” and the parties had stipulated that a motion to set aside the March 21, 2003 stipulated judgment could never be brought again. For that reason, the special master determined that there were no discoverable issues relating to any events prior to March 2003.

Earls objected to the special master’s recommendations in her memorandum of points and authorities dated December 20, 2005, arguing that the discovery she sought was relevant to her claims of fraud and duress.

I. Special Master’s December 14, 2005 Report and Recommendation

The special master filed his second report of referee on December 14, 2005. The second report addressed Amdahl’s discovery motions. Having previously found that there were no discoverable issues relating to any events prior to March 2003, the special master recommended that there be no further discovery by either Earls or Amdahl unless the trial court denied Amdahl’s motion to quash or dismiss Earls’ January 18, 2005 motion to set aside the August 14, 2003 dismissal order and the March 21, 2003 stipulated judgment.

Earls objected to the special master’s recommendation of December 14, 2005, in her points and authorities dated December 28, 2005, again arguing that the discovery she sought was relevant to her claims of fraud and duress.

However, on January 23, 2006, the parties stipulated to a discovery order compelling Earls to provide documents and responses to Amdahl’s requests for production of documents.

J. March 9, 2006 Order Adopting the Special Master’s Recommendations

On March 9, 2006, the trial court issued its order adopting the special master’s recommendations of December 5, 2005, and December 14, 2005, in their entirety. Earls sought review of the March 9, 2006 order in a petition for writ of mandate filed in this court on March 23, 2006. The writ petition was summarily denied on May 10, 2006.

K. September 29, 2006 Discovery Stipulation and Order

On September 29, 2006, the parties stipulated to the entry of a discovery order before the special master. The stipulated discovery order compelled Earls to respond to certain discovery requests made by Amdahl, set a hearing date regarding attorneys fees related to discovery, and reserved a determination of issue sanctions and evidence sanctions until the time of trial.

L. Attorney Fees Motions Relating to Discovery

A hearing date of September 29, 2006, was set on the issue of attorney fees related to discovery. Earls’ attorney, Thomas M. Swihart, submitted a September 15, 2006 declaration in support of Earls’ claim that she was entitled to an award of attorney fees and costs in the amount of $56,498 related to the conduct of discovery in this matter, pursuant to section 271. According to Swihart, Earls asserted that her discovery was necessitated by Amdahl’s fraudulent concealment of his assets and income throughout the parties’ marital dissolution action, and that she would not have entered into any of prior stipulations had she known the true state of Amdahl’s financial affairs. For example, Earls claimed that Amdahl had fraudulently stated that his gross income for the 1992 tax year was $185,000, but she had discovered that his reported adjusted gross income for 1992 was actually $722,649.

Section 271 provides in part, “(a) Notwithstanding any other provision of this code, the court may base an award of attorney’s fees and costs on the extent to which the conduct of each party or attorney furthers or frustrates the policy of the law to promote settlement of litigation and, where possible, to reduce the cost of litigation by encouraging cooperation between the parties and attorneys. An award of attorney’s fees and costs pursuant to this section is in the nature of a sanction.”

In his declaration filed on September 15, 2006, Amdahl asserted that he was entitled to attorney fees related to discovery in the amount of $104,500. Amdahl argued that he had properly complied with Earls’ discovery requests and his resistance to a further deposition had been upheld by the court, while Earls had refused to properly comply with his discovery requests. Earls’ lack of compliance had, according to Amdahl, required him to file motions to compel discovery.

Amdahl also submitted an offer of proof in rebuttal to Earls’ declaration in support of her request for attorney fees and costs, in which he described in detail the lack of justification for any of her discovery requests and the justification for his discovery requests.

Earls filed another declaration on September 29, 2006, that included her description of the “tactics of duress and intimidation” of Amdahl and his attorney. She also submitted a supplemental declaration on October 16, 2006, as a rebuttal to Amdahl’s officer of proof, in which she denied his claim that his discovery was necessary.

M. Special Master’s October 23, 2006 Report and Recommended Attorney Fees Award

The special master issued his report and recommended attorney fee award on October 23, 2006. Having reviewed the file, the pleadings submitted in connection with the discovery fees issue, and heard the argument of counsel, the special master determined that the issue was whether the court should award discovery-related attorney fees against Earls under section 271.

In concluding that such fees should be awarded, the special master agreed with Amdahl that the discovery he had propounded to Earls had “been necessary in order [to] oppose [her] request for discovery for prior periods, obtain information for possible impeachment, as well as to attempt to establish [her] ability to pay reasonable attorney fees.”

The special master also determined that “the award recommended herein, is appropriate given the conduct of [Earls] in this case relative to the issues of discovery.” In particular, the special master found that Earls’ discovery responses had “not always been forthcoming” and she had only recently disclosed an asset showing that she had sufficient funds to pay for the recommended attorney fees order.

Further, the special master found that Earls had acted in bad faith in pursuing claims that she had already settled and her conduct “has made it impossible to enter into meaningful settlement negotiations. Her past history in this case is to ‘settle’ and then file to set aside the settlement.”

The special master also stated that he had considered the relative incomes of the parties, and while Amdahl’s income was substantially higher, Earls was not without resources and the attorney fees order that he was recommending was within her ability to pay. Accordingly, the special master recommended Amdahl should be awarded attorney fees in the amount of $60,000 in connection with the discovery issues, pursuant to section 271, and Earls should bear her own discovery-related attorney fees and costs.

Earls subsequently filed objections to the special master’s recommendations and Amdahl filed a response to her recommendations.

The record on appeal lacks a copy of Earls’ objections to the special master’s recommendations.

N. June 12, 2007 Order Awarding Discovery-Related Attorney Fees

On March 20, 2007, the trial court issued an order directing the parties to file further declarations and points and authorities regarding attorney fees and costs, as well as billing statements. A hearing on the attorney fees issue was held on January 29, 2007.

On June 1, 2007, the trial court issued its attorney fees order, which adopted the special master’s recommendation that Earls pay Amdahl discovery-related attorney fees of $60,000 pursuant to section 271. The court stated that “[t]he conduct upon which this order is based is that described in the report of the Discovery Master with his Recommended Order (10/23/06), which the Court finds to be true. The Court further finds that this order will not impose an unreasonable financial burden on [Earls].” The trial court issued an amended order on June 12, 2007, which, among other things, reiterated its order of June 1, 2007.

O. March 23, 2007 Order Regarding the Set Aside Motions

A hearing on Amdahl’s motion to quash or dismiss Earls’ January 18, 2005 motion to set aside the August 14, 2003 dismissal order and the March 21, 2003 stipulated judgment was held on January 29, 2007. During the hearing, the trial court rejected Earls’ argument that her set aside motion was timely under either section 2122, subdivision (c) or Code of Civil Procedure section 338, subdivision (d), the three-year statute of limitations for fraud claims. The trial court reasoned that section 2122, subdivision (c) applies only to judgments, and the August 14, 2003 dismissal order was not a judgment. The court then ruled from the bench that Earls’ motion was time-barred under the six-month limitations period set forth in Code of Civil Procedure section 473, subdivision (b), which applies to a party’s motion to set aside a “dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect.”

Section 2122 provides in part, “The grounds and time limits for a motion to set aside a judgment, or any part or parts thereof, are governed by this section and shall be one of the following: [¶] (c) Duress. An action or motion based upon duress shall be brought within two years after the date of entry of judgment.”

Code of Civil Procedure section 338, subdivision (d) provides a three-year limitations period for “[a]n action for relief on the ground of fraud or mistake. The cause of action in that case is not deemed to have accrued until the discovery, by the aggrieved party, of the facts constituting the fraud or mistake.”

Code of Civil Procedure section 473, subdivision (b) provides in part, “The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or any other proceeding taken again him or her through his or her mistake, inadvertence, surprise, or excusable neglect.”

The trial court issued its order after hearing on March 23, 2007, in which the court granted Amdahl’s motion to quash or dismiss Earls’ January 18, 2005 motion on the ground that the Earls’ motion was untimely filed. The court also ruled that all relief requested by Earls, with the exception of child support, was barred by the August 14, 2003 dismissal order, which included Earls’ stipulation that she could never bring a motion to reconsider or set aside the March 21, 2003 stipulated judgment.

The trial court also stated in its March 23, 2007 order that the issue of attorney fees would be addressed by a separate order.

P. Attorney Fee Motions Relating to the Set Aside Motions

Amdahl’s attorney, Joan M. Pfeifer, filed a 20-page declaration dated April 12, 2007, which was also verified by Amdahl and his “civil attorney,” Theodore Ting, regarding his contention that he was entitled to an award of attorney fees in the amount of $485,000, based on section 271 and Code of Civil Procedure section 128.5, for matters not related to discovery.

In the declaration, Pfeiffer maintained that the attorney fees were necessarily incurred in defending Earls’ meritless set aside motion and in defending the related civil action that Earls had filed against Amdahl in Alameda County. Pfeiffer explained the fees had been incurred over a three and one-half years and involved “defensive fees and costs in two courts in two counties for 12 more motions, 40 court appearances, over 5,100 pages of discovery [and] 2,700 pages of discovery received from Ms. Earls after multiple motions and orders to compel in order to prove again the invalidity of her repeated claims, as well as a trip to the Court of Appeal, and a trip to the California Supreme Court (both resulting in rulings against Ms. Earls), etc.--all for no reason other than to revisit issues that had already been the subject of not only final orders of the Court, but also Ms. Earls’ specific warranty that she would never file such actions again.”

Earls responded in her “post trial brief re attorney fees,” filed April 16, 2007, that Amdahl’s request for attorney fees should be denied and she should be awarded attorney fees in the amount of $103,894 incurred in litigating Amdahl’s motion to quash or dismiss her set aside motion. Earls argued, among other things, that she was entitled to attorney fees due to the disparity in their financial situations and Amdahl’s conduct in lengthening and complicating the litigation.

Thereafter, Amdahl filed an “Attorney’s fees rebuttal declaration,” dated May 7, 2007, in which he asserted that Earls had misrepresented the true state of her financial affairs (for example, she had recently received $1.8 million from the sale of her Berkeley home). Amdahl also rejected Earls’ characterization of his conduct of the litigation.

Q. June 12, 2007 Order Awarding Nondiscovery-Related Attorney Fees

The trial court issued an attorney fees order on June 1, 2007 and an amended attorney fees order on June 12, 2007. As stated in the amended order, the court ruled that Amdahl was entitled to the payment of attorney fees and costs in the amount of $225,000 for nondiscovery-related matters. The order also states, “The conduct upon which this order is based includes: [¶] a. [Earls’] filing of motions on January 18, 2005, and April 19, 2005, that sought to set aside prior orders without legal justification for such motions; and [¶] b. [Earls’] refusal to cooperate and reduce the cost of the litigation process by her unwillingness to make or consider reasonable settlement offers to resolve the litigation.” Amdahl filed opposition to the request, arguing that no statement of decision was required. The trial court denied the request for a statement of decision in its order of July 27, 2007, on the grounds that (1) a party was not entitled to a statement of decision with respect to the court’s awarding of attorney fees under section 271; and (2) the order sufficiently explained the factual and legal basis for the court’s rulings and therefore satisfied the requirements of Code of Civil Procedure section 632. Thereafter, on June 28, 2007, Earls filed a “post trial brief” regarding her request for a statement of decision.

R. Earls’ April 19, 2005 Child Support Motion

In addition to litigating Earls’ January 18, 2005 set aside motion and the related discovery issues, the parties also litigated the issue of child support.

On April 19, 2005, Earls filed a motion for an upward modification of Amdahl’s child support obligation and to set aside the previously stipulated child support order of $2,500 per month for Jordan, which was incorporated in the March 21, 2003 stipulated judgment. Earls argued that relief from the prior stipulation was warranted in light of Amdahl’s fraudulent misrepresentations regarding his earning capacity. In particular, Earls contended that Amdahl had fraudulently misrepresented in January 2003 that he “had passed his zenith of high income earning capacity” because his tax returns showed that he had earned $1 million in 2003. Earls also claimed that she had spent “over half a million dollars of [her] retirement account” due to Amdahl’s concealment of his actual income. Further, Earls asserted that Amdahl had avoided his child support obligation by “transferring child support duties” to the children’s trust.

On April 20, 2006, the trial court ordered that only that portion of Earls’ motion for an upward modification of child support that related to the period of April 19, 2005 (the date the motion was filed) through May 26, 2006 (the date of Jordan’s high school graduation) be restored to the calendar.

S. March 23, 2007 Child Support Order

After an evidentiary hearing held on January 30, 2007, the trial court issued a February 15, 2007 tentative decision regarding child support.

In its tentative decision, the trial court made several findings of fact. The court found that Amdahl had earned an average salary of $64,406 per month during the 13-month period of April 19, 2005 through May 26, 2006, plus other taxable income averaging $5,541 per month, while during that same period Earls had no earnings and received monthly spousal support of $3,333. The court also found that Amdahl had “primary physical responsibility” for Jordan during 12 percent of the 13-month time period. Based on these findings, the trial court calculated that the guideline amount of monthly child support during that period was $5,767.

The trial court also determined that Earls had shown sufficient changed circumstances to support her motion for modification of child support, consisting of the increase in Amdahl’s income. However, the trial court found that application of the guideline formula for child support would result in an award that was “unjust and inappropriate and would exceed Jordan’s needs.” The court stated, “During the relevant time period [Amdahl] had an extraordinarily high income and the amount determined under the formula exceeded the needs of the child. The evidence established that following the court’s [March 21, 2003] support order, Jordan lived a life style consistent with his parent’s position in society. The child support received by [Earls] was sufficient to satisfy all of Jordan’s needs.”

Additionally, the trial court found that a retroactive increase in child support would not alter Jordan’s past lifestyle and would “constitute a windfall” for Earls, since an increase in child support was not necessary to compensate her for Jordan’s expenses. The trial court accordingly ruled in its tentative decision that no modification of the existing child support order of $2,500 per month was warranted.

On March 23, 2007, the trial court issued an order after hearing re child support. The order included the findings made by the court in its tentative decision of February 15, 2007. The trial court also made the express finding that Amdahl was an extraordinarily high earner, because he had a monthly net disposable income of $37,000 during the 13-month period at issue, and therefore the court should determine whether a deviation from guideline child support was appropriate. Because the trial court determined that the existing child support order of $2,500 per month met all of Jordan’s needs and was therefore consistent with his best interests, the court denied Earls’ motion for an upward modification of child support.

III. DISCUSSION

On appeal, Earls challenges four trial court orders: (1) the March 25, 2007 order denying her motion to set aside the August 14, 2003 dismissal order and the March 21, 2003 stipulated judgment; (2) the March 25, 2007 child support order; (3) the June 12, 2007 order awarding respondent Carlton G. Amdahl discovery-related attorney fees of $60,000 pursuant to Family Code section 271; and (4) the June 12, 2007 order awarding Amdahl attorney fees of $225,000 pursuant to section 271, due to Earls’ unwillingness to make or consider reasonable settlement offers to resolve the litigation. We will discuss the parties’ contentions regarding each order in turn.

A. The March 25, 2007 Order Denying Earls’ Set Aside Motion

1. The Parties’ Contentions

On appeal, Earls contends that the trial court erred in ruling that her January 18, 2005 motion to set aside the August 14, 2003 dismissal order and the March 21, 2003 stipulated judgment was untimely filed beyond the six-month period provided by Code of Civil Procedure section 473 for set aside motions. She asserts that the trial court either (1) erred in implicitly ruling that her claim for equitable relief based on extrinsic fraud and duress was governed by the six-month time limitation under Code of Civil Procedure section 473; or (2) abused its discretion by failing to consider her claim for equitable relief on the grounds of extrinsic fraud and duress. Earls does not challenge the trial court’s rulings that her January 18, 2005 set aside motion was untimely filed beyond the six-month time period provided by Code of Civil Procedure section 473 and that the time limitations set forth in section 2122 did not apply.

Based on her claims of trial court error, Earls seeks reversal of the trial court’s March 25, 2007 order and remand of the matter to the trial court for a determination of whether she is entitled to equitable relief from the August 14, 2003 dismissal order. Thereafter, if the trial court grants her equitable relief from the August 14, 2003 dismissal order (in which she agreed to never challenge the March 21, 2003 stipulated judgment), Earls believes that she will be able to litigate her motion to set aside the March 21, 2003 stipulated judgment under section 2120 et seq.

In response, Amdahl asserts that Earls’ claims of trial court error are barred under the doctrine of invited error. According to Amdahl, Earls argued in the trial court that her motion to set aside the August 14, 2003 dismissal order was timely filed under section 2120 et seq. and contract law. He points out that when the trial court ruled during the hearing on the motion that section 2120 et seq. did not apply and the motion was time-barred under Code of Civil Procedure section 473, Earls did not argue, as she now does on appeal, that she had an unlimited amount of time to seek relief on the equitable grounds of extrinsic fraud and duress.

Alternatively, Amdahl argues that Earls failed to provide any evidence of extrinsic fraud or duress, instead improperly asserting during the proceedings below that the trial court was required accept her allegations of fraud and duress as true because the proceedings were similar to a demurrer. Amdahl also contends that his evidence shows the absence of any extrinsic fraud or duress in connection with the August 14, 2003 dismissal order.

As Amdahl correctly notes, demurrers may not be used in family law proceedings. (Cal. Rules of Court, rule 5.108 (a).)

2. Set Aside Motions in Family Law Cases

We will begin our analysis with a review of the well-established rules governing set aside motions in family law cases. Code of Civil Procedure section 473 and section 2122 “now coexist, operating as alternative bases for relief, depending on when the application is filed. Within the six-month time limit under section 473, a litigant may seek relief from a family law judgment under either the statute’s mandatory provisions (where the litigant’s attorney is willing to swear to his [or her] own fault) or its discretionary provisions (where the court ‘may’ relieve a party of the consequences of his or her own mistake, inadvertence, surprise, or excusable neglect). Alternatively, the litigant may seek relief under any of the specific grounds specified in [section] 2122.” (In re Marriage of Heggie (2002) 99 Cal.App.4th 28, 32, fn. omitted.)

Subdivision (b) of Code of Civil Procedure section 473 provides, “The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect. Application for this relief shall be accompanied by a copy of the answer or other pleading proposed to be filed therein, otherwise the application shall not be granted, and shall be made within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken.”

Section 2122 provides five exclusive grounds to set aside a judgment in a family law case, including actual fraud, perjury, duress, mental incapacity, or mistake. (In re Marriage of Brewer v. Federici (2001) 93 Cal.App.4th 1334, 1344.) Sections 2121 and 2122 also “establish longer time limitations of up to one year--and in cases of duress or mental incapacity, up to two years--for bringing actions or motions to set aside or modify dissolution judgments. Thus, [section] 2121 provides that a court may set aside a judgment of dissolution after the six-month time limit established by Code of Civil Procedure section 473 has run.” (In re Marriage of Eben-King & King (2000) 80 Cal.App.4th 92, 112.) However, as expressly provided by section 2121, section 2122 applies only to judgments, or any part of a judgment, “adjudicating support or division of property.”

Section 2122 provides, “The grounds and time limits for a motion to set aside a judgment, or any part or parts thereof, are governed by this section and shall be one of the following: [¶] (a) Actual fraud where the defrauded party was kept in ignorance or in some other manner was fraudulently prevented from fully participating in the proceeding. An action or motion based on fraud shall be brought within one year after the date on which the complaining party either did discover, or should have discovered, the fraud. [¶] (b) Perjury. An action or motion based on perjury in the preliminary or final declaration of disclosure, the waiver of the final declaration of disclosure, or in the current income and expense statement shall be brought within one year after the date on which the complaining party either did discover, or should have discovered, the perjury. [¶] (c) Duress. An action or motion based upon duress shall be brought within two years after the date of entry of judgment. [¶] (d) Mental incapacity. An action or motion based on mental incapacity shall be brought within two years after the date of entry of judgment. [¶] (e) As to stipulated or uncontested judgments or that part of a judgment stipulated to by the parties, mistake, either mutual or unilateral, whether mistake of law or mistake of fact. An action or motion based on mistake shall be brought within one year after the date of entry of judgment. [¶] (f) Failure to comply with the disclosure requirements of Chapter 9 (commencing with Section 2100). An action or motion based on failure to comply with the disclosure requirements shall be brought within one year after the date on which the complaining party either discovered, or should have discovered, the failure to comply.”

Section 2121 provides, “(a) In proceedings for dissolution of marriage, for nullity of marriage, or for legal separation of the parties, the court may, on any terms that may be just, relieve a spouse from a judgment, or any part or parts thereof, adjudicating support or division of property, after the six-month time limit of Section 473 of the Code of Civil Procedure has run, based on the grounds, and within the time limits, provided in this chapter. [¶] (b) In all proceedings under this chapter, before granting relief, the court shall find that the facts alleged as the grounds for relief materially affected the original outcome and that the moving party would materially benefit from the granting of the relief.”

A motion to set aside an order in a family law case, such as the August 14, 2003 dismissal order at issue here, is governed by Code of Civil Procedure section 473. After the expiration of the six-month time period provided by Code of Civil Procedure section 473 for a motion to set aside an order on the grounds of mistake, inadvertence, surprise, or excusable neglect, an “otherwise valid” order may be set aside under the court’s inherent equitable power to set aside an order on the grounds of extrinsic fraud or mistake. (In re Marriage of Varner (1997) 55 Cal.App.4th 128, 139-140; In re Marriage of Melton (1994) 28 Cal.App.4th 931, 937.) “Extrinsic fraud occurs when a party is deprived of his opportunity to present his claim or defense to the court, where he was kept in ignorance or in some other manner fraudulently prevented from fully participating in the proceedings. [Citation.]” (In re Marriage of Melton, supra, 28 Cal.App.4th at p. 937.) Duress has also been recognized as a ground for equitable relief. (In re Marriage of Brockman (1987) 194 Cal.App.3d 1035, 1047; In re Marriage of Baltins (1989) 212 Cal.App.3d 66, 83-84.)

3. Waiver of the Timeliness Issue

Because it did not appear that Earls had expressly argued below that her motion to set aside the August 14, 2003 dismissal order was timely filed after the expiration of the Code of Civil Procedure section 473 six-month time period, as to her claim for equitable relief on the grounds of extrinsic fraud and duress, we asked the parties for supplemental briefing regarding the following question: “Did [Earls] waive or forfeit the issue of whether her January 18, 2005 motion was timely filed, as to her claim for equitable relief on the grounds of extrinsic fraud and duress from the August 14, 2003 request and order for dismissal, by failing to raise that issue in the trial court?”

Our request for supplemental briefing also asked the parties to address the following statement by Earls’ trial counsel during the hearing on the motion held on January 29, 2007: “We believe we are timely in our attack of the March 21st of ’03 order as well as the August 14, ’03 order, under [section] 2122, [subdivision] (c), and [Code of Civil Procedure] section 338 [, subdivision (d)].”

In her supplemental brief, Earls contends that she asserted in the proceedings below that she was proceeding under a theory of extrinsic fraud and duress with respect to her motions for relief and in defense of Amdahl’s motion to quash or dismiss her January 18, 2005 set aside motion. She points to the general statement in her trial brief, dated January 18, 2007, that “[i]t is a well-settled doctrine of equitable jurisdiction that where one has been prevented by extrinsic facts from presenting one’s case to the court, one may bring a motion or an independent action in equity to secure relief from the resulting judgment.” Earls also notes that she stated in her trial brief that “[t]he time limit for the filing of such a motion or suit is ‘a reasonable time from discovery of the default judgment irrespective of when it may actually have been entered.’ ”

Amdahl maintains in his supplemental brief that Earls has waived the issue, because she never contended during the proceedings below, as she now does on appeal, “that there was no time limit for filing a set aside of the [August 14, 2003] dismissal order if she could prove duress or extrinsic fraud specifically related to that dismissal order.” Amdahl also observes that Earls argued below that her January 18, 2005 motion to set aside the August 14, 2003 dismissal order was timely filed under contract law and section 2122, and raised the issue of timeliness on equitable grounds only as to her April 19, 2005 motion to set aside or modify the child support order included in the March 21, 2003 stipulated judgment.

4. Analysis

For several reasons, we agree with Amdahl that Earls has waived the issue of whether her January 18, 2005 motion was timely filed as to her claim for equitable relief on the grounds of extrinsic fraud and duress. “It is well established that issues or theories not properly raised or presented in the trial court may not be asserted on appeal, and will not be considered by an appellate tribunal. A party who fails to raise an issue in the trial court has therefore waived the right to do so on appeal. [Citations.]” (In re Marriage of Eben-King & King, supra, 80 Cal.App.4th at p. 117.) An exception to this general rule applies where the arguments raised pertain only to questions of law on undisputed facts. “Although a party may ordinarily not change his theory on appeal, the rule does not apply when the facts are not disputed and the party merely raises a new question of law.” (UFITEC, S. A. v. Carter (1977) 20 Cal.3d 238, 249, fn. 2.)

In the present case, there is obviously a factual dispute as to whether Earls was compelled by extrinsic fraud or duress to request dismissal of her June 2, 2003 motion to set aside, which was entered as the order of the court on August 14, 2003, and included her stipulation that she would never bring another motion to reconsider or set aside the March 21, 2003 stipulated judgment. We also find that Earls did not properly raise or present in the trial court the issue of whether her January 18, 2005 motion to set aside the August 14, 2003 dismissal order was timely filed on the grounds of extrinsic fraud and duress beyond the six-month period provided by Code of Civil Procedure section 473.

Our review of the record indicates that Earls consistently argued during trial court proceedings that her motion was timely filed under section 2120 et seq. and the statute of limitations applicable to fraud claims, Code of Civil Procedure section 388, subdivision (d). In her trial brief, dated January 18, 2007, Earls stated that her January 18, 2005 set aside motion was “proceeding under [sections] 2120 and 2122. The statutory authority herein cited provides time limitations with which [she] has fully complied.” Earls also stated in her trial brief, “Here, Petitioner has brought this request for relief based on duress within the two year statute as promulgated by the statute” and “it would seem that [Code of Civil Procedure] section 338 is applicable.”

Moreover, at the time of the hearing on the January 18, 2005 and April 19, 2005 set aside motions, Earls did not assert that her January 18, 2005 set aside motion was timely filed as to her claims for relief due to extrinsic fraud and duress. Earls’ attorney stated at the outset of the hearing that “[w]e are asking the Court to make a determination whether or not we filed in a timely fashion.” Then, when the trial court ruled from the bench that the January 18, 2005 motion was untimely filed because it was not brought within the six-month time period provided by Code of Civil Procedure section 473, Earls’ attorney responded that “[o]ur argument is that [section] 2122, et seq. applies because we are in a family law case . . . .” Earls’ attorney further responded, “We believe we are timely in our attack of the March 21st of ’03 order as well as the August 14, ’03 order, under [section] 2122, [subdivision] (c), and . . . [Code of Civil Procedure] section 338[, subdivision] (c).” No argument was made by Earls’ attorney that the motion was timely filed because the motion sought equitable relief, to which statutory time limitations did not apply.

It is also axiomatic that “ ‘[a]n appellate court will ordinarily not consider procedural defects or erroneous rulings . . . where an objection could have been, but was not, presented to the lower court by some appropriate method. [Citations.]’ [Citations.]” (In re Marriage of Hinman (1997) 55 Cal.App.4th 988, 1002.) The record reflects that Earls had the opportunity to object to the trial court’s timeliness ruling on the ground that her claim for equitable relief was timely but she failed to do so.

Near the conclusion of the hearing, when the trial court ruled that section 2122 did not apply to the August 14, 2003 dismissal order because the order was neither “a judgment nor a support order,” and therefore the motion was untimely filed beyond the six-month limitation period of Code of Civil Procedure section 473, Earls’ attorney did not object that the motion sought equitable relief and was therefore timely. Earls’ attorney only asserted during the hearing that her April 19, 2005 motion to set aside the prior child support order was timely filed because it sought equitable relief, as follows: “But what was in the April 19th motion was an extrinsic fraud allegation, which carries no statute of limitations whatsoever. By the authority that has been cited in my motion, a motion of that nature must be brought a reasonable time after discovery.”

We therefore determine that the trial court did not make any ruling as to whether the January 18, 2005 set aside motion was timely filed as a motion for equitable relief on the grounds of extrinsic fraud and duress because Earls did not raise that issue during trial court proceedings. Her failure to do so constitutes a waiver of that issue on appeal. (In re Marriage of Eben-King & King, supra, 80 Cal.App.4th at p. 117.)

B. The March 25, 2007 Child Support Order

Earls contends that the trial abused its discretion in denying her motion for an upward modification of the previous child support order of $2,500 per month for Jordan. Our review of her claim of trial court error is guided by the applicable standard of review and the statutory scheme that governs child support orders.

1. The Standard of Review

The standard of review for an order modifying a child support order is well established. “[A] determination regarding a request for modification of a child support order will be affirmed unless the trial court abused its discretion, and it will be reversed only if prejudicial error is found from examining the record below.” (In re Marriage of Leonard (2004) 119 Cal.App.4th 546, 555; In re Marriage of Pearlstein (2006) 137 Cal.App.4th 1361, 1371.) Thus, “[t]he ultimate determination of whether the individual facts of the case warrant modification of support is within the discretion of the trial court. [Citation.] The reviewing court will resolve any conflicts in the evidence in favor of the trial court’s determination. [Citation.]” (In re Marriage of Leonard, supra, 119 Cal.App.4th at p. 556; In re Marriage of Williams (2007) 150 Cal.App.4th 1221, 1233-1234.)

However, “the trial court has ‘a duty to exercise an informed and considered discretion with respect to the [parent's child] support obligation . . . .’ [Citation.] Furthermore, ‘in reviewing child support orders we must also recognize that determination of a child support obligation is a highly regulated area of the law, and the only discretion a trial court possesses is the discretion provided by statute or rule. [Citations.]’ [Citation.] In short, the trial court’s discretion is not so broad that it ‘may ignore or contravene the purposes of the law regarding ... child support. [Citations.]’ [Citation.]” (In re Marriage of Cheriton (2001) 92 Cal.App.4th 269, 283 (Cheriton).)

2. Guideline Child Support

This court has previously outlined the statutes and public policy governing the calculation of child support awards. “California has a strong public policy in favor of adequate child support. [Citations.] That policy is expressed in statutes embodying the statewide uniform child support guideline. (See [§§ ]4050-4076.) ‘The guideline seeks to place the interests of children as the state’s top priority.’ (§ 4053, subd. (e).) In setting guideline support, the courts are required to adhere to certain principles, including these: ‘A parent’s first and principal obligation is to support his or her minor children according to the parent’s circumstances and station in life.’ (§ 4053, subd. (a).) ‘Each parent should pay for the support of the children according to his or her ability.’ (§ 4053, subd. (d).) ‘Children should share in the standard of living of both parents. Child support may therefore appropriately improve the standard of living of the custodial household to improve the lives of the children.’ (§ 4053, subd. (f).)” (Cheriton, supra, 92 Cal.App.4th at pp. 283-284.)

“To implement these policies, courts are required to calculate child support under the statutory guidelines. (See §§ 4052-4055.) ‘[A]dherence to the guidelines is mandatory, and the trial court may not depart from them except in the special circumstances enumerated in the statutes. (§§ 4052; 4053, subd. (k); [citation].)’ [Citation.] The guideline amount of child support, which is calculated by applying a mathematical formula to the parents’ incomes, is presumptively correct. [Citation.]” (In re Marriage of Williams, supra, 150 Cal.App.4th at pp. 1236-1237.)

3. Extraordinarily High Income

As set forth in section 4057, subdivision (b)(3), the trial court may depart from guideline child support under the special circumstance that the supporting parent has an extraordinarily high income.

Section 4057, subdivision (b)(3) provides that the presumption that the guideline amount of child support is correct “may be rebutted by admissible evidence showing that application of the formula would be unjust or inappropriate in this particular case, consistent with the principles set forth in Section 4053, because one or more of the following factors is found to be applicable by a preponderance of the evidence, and the court states in writing or on the record the information required in subdivision (a) of Section 4056 : [¶] . . . [¶] (3) The parent being ordered to pay support has an extraordinarily high income and the amount determined under the formula would exceed the needs of the children.”

Section 4056 provides, “(a) To comply with federal law, the court shall state, in writing or on the record, the following information whenever the court is ordering an amount for support that differs from the statewide uniform guideline formula amount under this article: [¶] (1) The amount of support that would have been ordered under the guideline formula. [¶] (2) The reasons the amount of support ordered differs from the guideline formula amount. [¶] (3) The reasons the amount of support ordered is consistent with the best interests of the children. [¶] (b) At the request of any party, the court shall state in writing or on the record the following information used in determining the guideline amount under this article: [¶] (1) The net monthly disposable income of each parent. [¶] (2) The actual federal income tax filing status of each parent (for example, single, married, married filing separately, or head of household and number of exemptions). [¶] (3) Deductions from gross income for each parent. [¶] (4) The approximate percentage of time pursuant to paragraph (1) of subdivision (b) of Section 4055 that each parent has primary physical responsibility for the children compared to the other parent.”

The term “extraordinarily high income” is not defined in the Family Code. However, a high earning parent who seeks a downward departure from a presumptively correct guideline amount of child support has the burden to show that the guideline amount would exceed the children’s reasonable needs. (§ 4057, subd. (b)(3); In re Marriage of Hubner (2001) 94 Cal.App.4th 175, 183.) “Because the definition of extraordinarily high income is tied to the children’s needs in each instance, the evidentiary focus must be on the children’s needs and not on the absolute amount of the parent’s income. [Citation.] What constitutes extraordinarily high income also may vary from one geographical area of the state to another. [Citation.]” (Cheriton, supra, 92 Cal.App.4th at p. 297.)

In exercising its discretion to order a downward departure from guideline child support, “the trial court must at least approximate the point at which the guideline support obligation due from a high earner would exceed the children’s needs. [Citation.]” (Ibid.) The children’s needs are defined by the parent’s “current station in life,” rather than the children’s “historic expenses.” (Cheriton, supra, 92 Cal.App.4th at p. 293.) “ ‘Clearly where the child has a wealthy parent, that child is entitled to, and therefore “needs” something more than the bare necessities of life.’ [Citations.]” (Ibid.)

However, the trial court has considerable discretion when departing from guideline support due to a special circumstance, such as the supporting parent’s extraordinarily high income. “Generally speaking, when any assumption operating through the guideline formula produces an ‘unjust or inappropriate’ result ‘due to special circumstances in the particular case,’ [section] 4057 ‘effective vests trial courts with considerable discretion to approach unique cases on an ad hoc basis. [Citation.]’ [Citation].” (In re Marriage of Drake (1997) 53 Cal.App.4th 1139, 1157.)

4. Analysis

In this case, the trial court determined that Amdahl had an extraordinarily high income after finding that his total gross monthly income during the relevant time period of April 19, 2005, through May 26, 2006, was $69,947 (including average salary of $64,406 plus other taxable income averaging $5,541 per month). The trial court also calculated that the amount of guideline child support, based in part on Amdahl’s earnings, was $5,767 per month. The court concluded, however, that a downward departure from guideline child support was warranted because Amdahl was an extraordinarily high earner and guideline support would exceed the child’s needs, based on the evidence showing that, under the previous child support order of $2,500 per month, “Jordan lived a life style consistent with his parents’ position in society. The child support received by [Earls] was sufficient to satisfy all of Jordan’s needs.”

Earls claims that the trial court abused its discretion in awarding monthly child support for Jordan of $2,500 on the ground that the trial court failed to determine “at what level [Amdahl’s] income became extraordinarily high.” She also argues that the trial court failed to determine “what amount would be appropriate for Jordan to live a life style commiserate [sic] with the life style of [Amdahl] and, then, to determine at what point guideline support would exceed Jordan’s reasonable needs.” Further, Earls disagrees with the trial court’s finding that an increase in child support would constitute a “windfall” for Earls.

Amdahl responds that the evidence presented at trial, including his offer of proof and the parties’ testimony, support the trial court’s finding that child support of $2,500 met Jordan’s needs. This evidence, according to Amdahl, established Jordan’s high standard of living, which included attending high school at Woodside Priory, “one of the Bay Area’s finest boarding schools”; travel to Europe; weekends in his parents’ “multi-million dollar homes”; driving a late model Volvo; “hired drivers until he was licensed”; “enrichment activities”; “rafting trips;” expensive clothing; “sporting goods”; “the fastest laptop computer money can buy”; “dining out and movies”; San Francisco 49ers football games; and “all his other needs.” Earls does not dispute this evidence regarding Jordan’s lifestyle. However, she claims that the evidence also showed that Jordan’s reasonable needs were not met because he was unable to ski or attend “various events and trips” since child support of $2,500 per month was inadequate.

To the extent Earls challenges the trial court’s factual findings regarding either Amdahl’s extraordinarily high income or Jordan’s reasonable needs, we review for substantial evidence. We examine the evidence in the light most favorable to the prevailing party and do not reweigh the evidence or reconsider the trial court’s credibility determinations. (In re Marriage of Calcaterra & Badakhsh (2005) 132 Cal.App.4th 28, 34.) Applying this standard, we find that substantial evidence supports the trial court’s factual findings and therefore the trial court did not abuse its considerable discretion in awarding child support of $2,500 per month for the time period of April 19, 2005, through May 26, 2006, which encompassed Jordan’s last year of high school.

Regarding the court’s finding that Amdahl had an extraordinarily high income, Amdahl’s offer of proof specified that his income of more than $800,000 per year placed him in the top one percent of California income earners. As to Jordan’s reasonable needs, the evidence showed that Jordan attended a private boarding school and enjoyed a lifestyle consistent with the financial resources available to his wealthy father. (Johnson v. Superior Court (1998) 66 Cal.App.4th 68, 75-76.) While Earls’ disputes the trial court’s findings, our standard of review does not permit us to reweigh the evidence or reconsider the trial court’s implied credibility determinations. (In re Marriage of Calcaterra & Badakhsh, supra, 132 Cal.App.4th at p. 34.)

Earls’ reliance on the decision in McGinley v. Herman (1996) 50 Cal.App.4th 936 (McGinley)for a contrary result is misplaced because that decision is distinguishable. In McGinley, the trial court failed to make a specific finding as to the exact amount of the father’s extraordinarily high earning capacity or income. (Id. at p. 940.) Nevertheless, the court awarded monthly child support of $2,000 because that support figure “ ‘came to mind’ ” and it would be “ ‘nonsensical’ ” to award guideline child support where the parties’ “ ‘casual relationship’ ” had resulted in the birth of a child. (Ibid.) On appeal, the child support order was reversed because the trial court “did not give sufficient consideration to the child’s right to share in the standard of living of his extraordinarily high earning father.” (Id. at p. 945.) The matter was remanded to the trial court to reassess the child support request “under the appropriate criteria.” (Id. at p. 946.)

In the present case, the trial court in determining the award of child support properly made a specific finding as to the exact amount of Amdahl’s extraordinarily high income, considered Jordan’s reasonable needs and his right to share in the lifestyle of his wealthy father, and also considered other appropriate statutory criteria. We therefore conclude that the trial court did not abuse its discretion and we will affirm the monthly child support of $2,500. Having reached this conclusion, we need not address Earls’ objection to the trial court’s finding that an increase in child support would constitute a “windfall” for her.

C. The June 12, 2007 Order Awarding Discovery-Related Attorney Fees of $60,000

Earls also challenges the trial court’s June 12, 2007 award of $60,000 in discovery-related attorney fees to Amdahl under section 271. Before evaluating her specific contentions, we will review section 271 and the applicable standard of review.

1. Section 271

Section 271 advances the policy of the law “ ‘to promote settlement and to encourage cooperation which will reduce the cost of litigation.’ ” (In re Marriage of Petropoulos (2001) 91 Cal.App.4th 161, 177. Thus, “[f]amily law litigants who flout that policy by engaging in conduct that increases litigation costs are subject to the imposition of attorneys’ fees and costs as a sanction. [Citations.]” (Ibid.; In re Marriage of Falcone (2008) 164 Cal.App.4th 814, 827.)

“Specifically the statute provides: ‘Notwithstanding any other provision of this code, the court may base an award of attorney’s fees and costs on the extent to which the conduct of each party or attorney furthers or frustrates the policy of the law to promote settlement of litigation and, where possible, to reduce the cost of litigation by encouraging cooperation between the parties and attorneys. An award of attorney’s fees and costs pursuant to this section is in the nature of a sanction. In making an award pursuant to this section, the court shall take into consideration all evidence concerning the parties’ incomes, assets, and liabilities. The court shall not impose a sanction pursuant to this section that imposes an unreasonable financial burden on the party against whom the sanction is imposed. In order to obtain an award under this section, the party requesting an award of attorney’s fees and costs is not required to demonstrate any financial need for the award.’ (§ 271, subd. (a).)” (In re Marriage of Feldman (2007) 153 Cal.App.4th 1470, 1477.)

The standard of review for an order awarding attorney fees under section 271 is abuse of discretion. “ ‘ “The trial court’s order will be overturned only if, considering all of the evidence viewed most favorably in support of its order, no judge could reasonably make the order . . . .” [Citation.]’ ” (In re Marriage of Burgard (1999) 72 Cal.App.4th 74, 82.) Thus, the trial court’s findings of fact are reviewed under the substantial evidence standard of review. (In re Marriage of Feldman, supra, 153 Cal.App.4th at p. 1479.) We also uphold all reasonable inferences in support of the findings of fact. (Ibid.)

2. The Parties’ Contentions

Earls argues that the trial court abused its discretion because the court adopted the special master’s recommendation that Amdahl be awarded $60,000 in discovery-related attorney fees under section 271. According to Earls, the trial court erred by awarding sanctions primarily on the ground that she had brought motions to set aside her previous agreements, without making a determination as to the merits of those motions.

Also, Earls contends the special master did not make a finding of “sufficient discovery abuses to warrant the imposition of $60,000 in sanctions.” In her view, the special master’s finding that her discovery responses were not always forthcoming constituted a sanction for her apparent “delay in responding to discovery” requests about “her ability to pay sanctions.”

Earls additionally contends that the discovery propounded by Amdahl was unnecessary, since the trial court had already determined that her January 18, 2005 set aside motion was time-barred. However, Earls does not contest the amount of the $60,000 attorney fees award or the finding that the award would not impose an unreasonable financial burden on her.

Amdahl responds that the trial court did not abuse its discretion because substantial evidence supports the special master’s findings (which the trial court found to be true) that the fees that he had to incur for substantial discovery were necessary, Earls was not forthcoming in producing discovery, and the $60,000 award would not place an unreasonable burden on Earls.

3. Analysis

We agree with Amdahl that substantial evidence supports the trial court’s award of discovery-related attorney fees.

As we have discussed, Earls brought an untimely motion to set aside her previous agreements, which had been entered as the August 14, 2003 dismissal order and the March 21, 2003 stipulated judgment. Prior to the trial court’s March 25, 2007 order ruling that Earls’ January 18, 2005 set aside motion was untimely, her efforts to set aside her previous agreements caused Amdahl to propound discovery to defend against those efforts and her allegations of fraud and duress. In 2005, Amdahl had to file two motions to compel Earls’ responses to his discovery. Amdahl also had to respond to discovery propounded by Earls, who does not dispute Amdahl’s claim that Earls sought production of documents previously produced in the case.

In short, substantial evidence supports the trial court’s finding that discovery sanctions under section 271 were justified because the record reflects that the entirety of the discovery litigation was the result of Earls’ untimely attempt to set aside her previous agreements in this case. As the trial court found, Earls’ conduct clearly flouted the policy of the law to promote settlement and to encourage cooperation. Her conduct also obviously increased the cost of the litigation. (In re Marriage of Petropoulos, supra, 91 Cal.App.4th at p. 177.) We therefore conclude that the trial court did not abuse its discretion in awarding attorney fees as a sanction under section 271 and we will uphold the award of $60,000 for discovery-related attorney fees.

D. The June 12, 2007 Order Awarding Nondiscovery-Related Attorney Fees of $225,000

Finally, Earls’ challenges the June 12, 2007 order awarding Amdahl nondiscovery-related attorney fees of $225,000 under section 271. The trial court awarded the attorney fees after finding that Earls had filed set aside motions on January 18, 2005, and April 19, 2005, without legal justification, and she had also failed to cooperate and reduce the cost of litigation by making or considering reasonable settlement offers.

Earls’ argument, as stated in her opening brief, is as follows: “[Earls] was punished for filing set aside motions, the merits of which have never been determined. Because of the gross disparity between her resources and those of [Amdahl], the inescapable effect of the sanctions is to discourage her from filing meritorious motions to advance her cause. Issuing sanctions for that purpose is an abuse of discretion.” In her reply brief, Earls further argues that Amdahl’s settlement offers were not reasonable. She also contends that merely failing to respond to settlement offers does not justify an award of attorney fees as a sanction, citing In re Marriage of Aninger (1990) 220 Cal.App.3d 230 (Aninger).

However, Earls does not claim that she made reasonable settlement offers or dispute Amdahl’s assertion that she refused to participate in a settlement officer conference early in the proceedings. She also does not challenge the amount of the attorney fees award or argue that the award would impose an unreasonable financial burden on her.

In opposition to Earls’ contentions, Amdahl asserts that he made several settlement offers for less than the cost of his defense, including a March 2005 offer to accept $25,000 in exchange for Earls dropping the litigation in Santa Clara County and Alameda County and agreeing not to file another set aside motion. He also offered to increase child support to $3,000 per month. According to Amdahl, Earls declined or failed to respond to his settlement offers and made unreasonable settlement demands, including demands for between $1.5 million and $5 million to dismiss her actions in both counties and demands for “thousands more” in child support.

We reiterate that section 271 advances the policy of the law “ ‘to promote settlement and to encourage cooperation which will reduce the cost of litigation.’ ” (In re Marriage of Petropoulos, supra, 91 Cal.App.4th at p. 177.) Thus, “[f]amily law litigants who flout that policy by engaging in conduct that increases litigation costs are subject to the imposition of attorneys’ fees and costs as a sanction. [Citations.]” (Ibid.; In re Marriage of Falcone, supra, 164 Cal.App.4th at p. 827.) In other words, as this court has previously stated, “The duty imposed by [section] 271 requires a party to a dissolution action to be cooperative and work toward settlement of the litigation on pain of being required to share the party's adversary’s litigation costs.” (Nicholson v. Fazeli (2003) 113 Cal.App.4th 1091, 1102.)

Here, the record reflects that all of the litigation below occurred because Earls brought an untimely motion to set aside her previous agreements in this marital dissolution action. Substantial evidence supports the trial court’s finding that after Earls filed her untimely January 18, 2005 motion to set aside the August 14, 2003 dismissal order and the March 21, 2003 stipulated judgment, she failed to cooperate and reduce the cost of litigation by making or considering reasonable settlement offers. Moreover, Earls does not contend that she made any reasonable settlement offers or attempt to justify her refusal to participate in a settlement officer conference. Rather than engage in reasonable settlement negotiations in the proceedings below, she persisted in her meritless arguments that her January 18, 2005 set aside motion was timely, and refused to consider Amdahl’s offer to settle the matter for less than the costs of his defense.

The decision in Aninger, supra, 220 Cal.App.3d 230 does not aid Earls, since that decision is distinguishable. In Aninger, the issue on appeal concerned an award of attorney fees under former Civil Code section 4370.5 (now section 2032). Section 2032 authorizes an award of need-based attorneys’ fees and costs “ ‘to enable each party, to the extent practical, to have sufficient financial resources to present the party’s case adequately . . . .’ (§ 2032, subd. (b).)’ ” (Cheriton, supra, 92 Cal.App.4th 269, 314-315.) No issue of need-based attorney fees was presented in the instant case. Moreover, the trial court in Aninger, unlike the trial court here, made no finding that the husband or his counsel had behaved unreasonably. (Aninger, supra, 220 Cal.App.3d at p. 245-246.)

For these reasons, we conclude that the trial court did not abuse its discretion in awarding nondiscovery-related attorney fees under section 271, and we will uphold the order awarding Amdahl $225,000 in nondiscovery-related attorney fees.

E. Attorney Fees on Appeal

Amdahl requests an award of attorney fees and costs on appeal. We believe that his request should be addressed to the trial court in the first instance. (In re Marriage of Petropoulos, supra, 91 Cal.App.4th at p. 180.) “Although we have the power to appraise and fix attorney fees on appeal, we deem it the better practice to remand the cause to the trial court to determine the appropriate amount of such fees. [Citation.]” (Amtower v. Photon Dynamics, Inc. (2008) 158 Cal.App.4th 1582, 1610.)

IV. DISPOSITION

The trial court’s orders are affirmed, including the March 25, 2007 order denying appellant’s set aside motion; the March 25, 2007 child support order; the June 12, 2007 order awarding respondent attorney fees of $60,000; and June 12, 2007 order awarding respondent attorney fees of $225,000. Costs on appeal are awarded to respondent, in an amount to be determined by the trial court. The matter is remanded to the trial court for a determination, in its discretion, of the appropriate amount of attorney fees on appeal to be awarded to respondent.

WE CONCUR: PREMO, ACTING P.J., ELIA, J.


Summaries of

In re Marriage of Earls

California Court of Appeals, Sixth District
Nov 21, 2008
No. H031582 (Cal. Ct. App. Nov. 21, 2008)
Case details for

In re Marriage of Earls

Case Details

Full title:MARI-LYNNE EARLS Appellant, v. CARLTON G. AMDAHL, Respondent.

Court:California Court of Appeals, Sixth District

Date published: Nov 21, 2008

Citations

No. H031582 (Cal. Ct. App. Nov. 21, 2008)