Opinion
A158068
05-12-2023
In re the Marriage of ANNE TEARSE and JAMES TEARSE. v. JAMES TEARSE, Respondent. ANNE TEARSE, Appellant,
NOT TO BE PUBLISHED
(San Mateo County Super. Ct. No. FAM0122314)
STREETER, J.
Anne Tearse appeals, and James Tearse cross-appeals, from the trial court's judgment in this long-running, intensely litigated marital dissolution proceeding. After trial, the court issued a 170-page final statement of decision (FSOD), from which the parties have raised a host of appellate claims, 35 in all, regarding a broad range of matters. Most of these claims are not a basis for reversal of any part of the FSOD, including because many have been in whole or in part forfeited or waived for various reasons. We affirm the trial court's judgment, except that we (1) reverse for insufficient evidentiary support the trial court's order that Anne reimburse James $281,057.63 to cover her post-separation health care premiums; (2) reverse for insufficient evidentiary support the trial court's order that Anne reimburse James $27,386.57 for one-half of his post-separation interest and principal payments for a home equity line of credit; (3) reverse for lack of legal justification the trial court's order that Anne reimburse James $1,500 for money he transferred to her separate Wells Fargo account in July 2013; (4) dismiss Anne's challenge to the court's order that she vacate the family residence as moot; and (5) reverse for insufficient evidentiary support the trial court's order that James pay the outstanding balance contained in the Comerica home equity loan account x3672 from his share of the proceeds he was entitled to receive from the sale of the family residence.
For clarity's sake, we refer to the parties by their first names. We mean no disrespect by doing so.
BACKGROUND
James and Anne were married on May 17, 1992. They have four daughters. They stipulated below that their separation occurred on January 1, 2013. The record suggests this separation occurred after a period of economic distress in the family and apparent disagreements between the two of them over how to employ their financial resources. James, an eye surgeon who owned his own medical practice, the Tearse Eye Center (TEC), appears to have wanted to use more of these resources for business purposes than Anne did, while Anne appears to have wanted to use more of them for the children's college expenses than James did.
Anne filed a petition for legal separation on August 1, 2013, initiating this action, and James subsequently sought dissolution of the marriage. After years of litigation, which spawned multiple appeals, trial began in July of 2018. The trial court issued its judgment and 170-page FSOD on June 13, 2019.
This is the eighth such appeal in this court. See case numbers A151500, A152355, A155541 and A156019 (decided together in a consolidated appeal), A156538, A157576, A158582 and A159223.
Anne filed a timely notice of appeal and James filed a timely notice of cross-appeal, both from the judgment. In the appeal and cross-appeal, the parties raise various claims regarding the trial court's rulings on the valuation and division of the couple's financial assets, certain financial disputes that arose during the lengthy period after separation and before trial, and various procedural and evidentiary issues. As we will discuss, these claims include the following:
Summarizing things generally, the evidence indicates that Anne seized more than $400,000 in community funds around the time of the couple's separation without James's knowledge and never fully accounted to him, or to the court, regarding her use of these funds. The trial court found that Anne's improper seizure and concealment of these funds caused James to incur and pay certain charges, including penalties, interest, and fees for the late payment of taxes, and also taxes and penalties for his post-separation withdrawals from the parties' individual retirement account and 401(k) plans. The court ordered Anne to reimburse James for these payments based on her breach of her fiduciary duty to him. Anne contests the court's rulings in her appeal.
James and Anne contest the amount of temporary child and spousal support he should have paid post-separation and before final judgment to Anne, who remained in the family residence in Portola Valley (family residence). James did not pay anything above the base amount set by the court early in the case, although the evidence indicates his income at times exceeded a threshold amount that triggered his obligation to make bonus support payments. Before trial, James contended that he could not calculate the bonus amounts because a DissoMaster table was not attached to the court's order, issued in 2015, and he also moved to terminate support or impute income to Anne for her purported failure to seek work as ordered by the court. His temporary bonus support obligations were unresolved for almost six years, until the court addressed them in its FSOD. In his crossappeal, James challenges the court's retroactive adjustments to his temporary bonus support obligations. Anne, for her part, in her appeal, disputes the court's FSOD order regarding the guideline child support James must pay going forward.
Post-separation, James also made withdrawals from and payments to the community's home equity line of credit (HELOC), which the court found had a substantial outstanding balance at the time of trial. The parties dispute multiple rulings by the court regarding this HELOC, including how that outstanding balance should be applied in the valuation and division of the parties' financial assets, who is responsible for James's post-separation withdrawals and repayments, and the court's finding that there were two lines of credit rather than one.
The parties also contest the trial court's valuation and division of certain assets, including the equity they held in their family residence, their investment in another business, the Peninsula Eye Surgery Center (PESC), and the community's interest in James's business, TEC.
Further, after the separation, James paid for a variety of things, including the family's health care premiums and community credit card charges. In its FSOD, the court ordered Anne to reimburse James certain amounts for these payments, which Anne challenges on appeal.
The parties also debate the court's rulings on a variety of procedural and evidentiary matters. Anne's failure to make certain pretrial accountings and disclosures, the trial court's denial of her requests for additional funds for attorneys and experts, and the court's limits on each side's time to present and rebut evidence, all resulted in court rulings that limited her presentation of evidence and time for rebuttal. Anne challenges these rulings. She also challenges the trial court's admission of certain evidence she contends is inadmissible hearsay under People v. Sanchez (2016) 63 Cal.4th 665 (Sanchez). Finally, she contends the trial court erred in its FSOD by granting James's motion for judgment, which the court first denied after Anne's presentation of evidence at trial.
During the pendency of this appeal, on March 17, 2021, James filed a "Motion to Strike, Disregard Appellant's Unsupported Citations or Permit Appellant to Augment the Record on Appeal." On April 1, 2021, Anne filed an opposition to this motion and a request to augment the record, attaching the documents she sought to include in the record. We hereby permit Anne to augment the record with the documents attached to her filing and otherwise deny James's motion.
Also, during the pendency of this appeal, Anne filed notice that she had retained counsel for the limited purpose of writing, presenting, and filing motions, and defending against motions by James, in this appeal. Among other things, her counsel filed an opening brief on Anne's behalf. Anne subsequently filed a notice of completion of limited scope representation by her counsel. Anne, who otherwise appeared in propria persona, did not file a reply brief in her appeal, and she has not filed a cross-respondent's brief to James's cross-appeal.
DISCUSSION
Anne'S Appeal
Anne raises 30 separately numbered claims for partial or full reversal of the trial court's judgment. We first discuss claims that she has forfeited entirely and one claim that is moot, and then address the remainder of her claims.
I. Anne's Forfeited Claims
Anne has forfeited nine of her claims by failing to first raise them in the trial court, present sufficient legal authority or sufficient argument, present sufficient record citations, or discuss and demonstrate the insufficiency of the evidence underlying them.
"It is well settled that' "issues not raised in the trial court cannot be raised for the first time on appeal." '" (Honig v. San Francisco Planning Dept. (2005) 127 Cal.App.4th 520, 530 (Honig), citing Estate of Westerman (1968) 68 Cal.2d 267, 279.)
Accordingly, "a reviewing court ordinarily will not consider a challenge to a ruling if an objection could have been but was not made in the trial court." (In re S.B. (2004) 32 Cal.4th 1287, 1293, fn. omitted, superseded by statute on other grounds as stated in In re S.J. (2008) 167 Cal.App.4th 953, 962.)" 'The rule . . . is founded on considerations of fairness to the court and opposing party, and on the practical need for an orderly and efficient administration of the law.' [Citations.] Otherwise, opposing parties and trial courts would be deprived of opportunities to correct alleged errors, and parties and appellate courts would be required to deplete costly resources 'to address purported errors which could have been rectified in the trial court had an objection been made.' [Citation.] In addition, it is inappropriate to allow any party to 'trifle with the courts by standing silently by, thus permitting the proceedings to reach a conclusion in which the party could acquiesce if favorable and avoid if unfavorable.' [Citation.] [¶] The party also must cite to the record showing exactly where the objection was made. [Citations.] When an appellant's brief makes no reference to the pages of the record where a point can be found, an appellate court need not search through the record in an effort to discover the point purportedly made. [Citations.] We can simply deem the contention to lack foundation and, thus, to be forfeited." (In re S.C. (2006) 138 Cal.App.4th 396, 406-407.)
Further, because the party appealing must "affirmatively demonstrate error," it must "provide citations to the appellate record directing the court to the evidence supporting each factual assertion." (Meridian Financial Services, Inc. v. Phan (2021) 67 Cal.App.5th 657, 684 (Meridian Financial Services, Inc.).) The appellant "has the burden of persuasion; '[o]ne cannot simply say the court erred, and leave it up to the appellate court to figure out why.'" (People v. JTH Tax, Inc. (2013) 212 Cal.App.4th 1219, 1237 (JTH Tax, Inc.).) Accordingly, "[t]he reviewing court is not required to develop the parties' arguments or search the record for supporting evidence and may instead treat arguments that are not developed or supported by adequate citations to the record as waived." (Meridian Financial Services, Inc., at p. 684.)
Also," '[a]n appellant who challenges a factual determination in the trial court . . . must marshal all of the record evidence relevant to the point in question and affirmatively demonstrate its insufficiency to sustain the challenged finding.'" (Chicago Title Ins. Co. v. AMZ Ins. Services, Inc. (2010) 188 Cal.App.4th 401, 415 (Chicago Title Ins. Co.).) "If the appellant fails to fairly state all material evidence, we may deem waived any challenge based on the insufficiency of the evidence." (Ibid., accord, Mendoza v. City of West Covina (2012) 206 Cal.App.4th 702, 713-714.)
Finally," '[a]ppellate briefs must provide argument and legal authority for the positions taken. "When an appellant fails to raise a point, or asserts it but fails to support it with reasoned argument and citations to authority, we treat the point as waived." '" (Cahill v. San Diego Gas &Electric Co. (2011) 194 Cal.App.4th 939, 956 (Cahill).)
Anne's Claim 9
In her claim 9, Anne attacks the trial court's order requiring her to reimburse James for various post-separation payments he claimed he made from separate property income. Specifically, she contends the trial court erred in ordering her to reimburse James for post-separation payments for numerous things, such as principal and interest payments on a HELOC, credit card payments, property tax payments, penalties, interest and fees for delinquent taxes, and more. Anne claims these orders must be reversed because James failed to meet his burden of proving he made the payments in question out of his separate property income, since some portion of that income must have been derived from the increased value of James's business, TEC, due to contributions to the business from the community. (See In re Marriage of Dekker (1993) 17 Cal.App.4th 842, 851-853 (Dekker).)
Nowhere in the record do we see that Anne raised this issue in the trial court. Nor does she provide any legal authority for the premise of the argument she raises here: That separate income derived from a business whose value has been enhanced by community efforts is, as a matter of law, comprised at least in part of community funds. And even assuming there was legal support for that notion, Anne fails to cite any record evidence that the value of James's business was, in fact, elevated by community contributions. In light of these various deficiencies, Anne has forfeited her claim 9. (Honig, supra, 127 Cal.App.4th at p. 530; Estate of Westerman, supra, 68 Cal.2d at p. 279; JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237; Cahill, supra, 194 Cal.App.4th at p. 956; Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684.)
Anne's Claims 13 and 28
The trial court found that James incurred $60,051.05 in taxes and penalties post-separation for withdrawals from the parties' individual retirement account (IRA) and conversion of 401(k) loans to income, none of which were timely repaid. The court accepted James's contention that these post-separation tax liabilities resulted from Anne's misappropriation of community funds. It relied on James's testimony and his calculations of his liabilities for this finding.
Claim 13 is comprised of an array of scattershot reasons why the court was in error. Anne attempts to tie the various strands of her argument together by claiming that the court lacked jurisdiction to make these findings and abused its discretion in doing so. We need not address any of the points in this difficult-to-follow mishmash of arguments because Anne supplies no legal authority for any of them. (Cahill, supra, 194 Cal.App.4th at p. 956.)
In her claim 28, Anne argues that "[t]here is no substantial evidence that Anne 'misappropriated' over $400,000 in community funds" and, therefore, the court should not have ordered her as a consequence of her breach of her fiduciary duty to reimburse James $60,051.50, the amount of taxes and penalties he incurred for early withdrawals from the parties' IRA and conversion of 401(k) loans to income. But the trial court found, based on the evidence presented at trial, that Anne breached her fiduciary duty to James by concealing $404,000 of community funds that she took without his knowledge, comprised of $289,186 in cashier's checks Anne placed in a bank account, from which she planned to fund a trust to be used for their children's college education (Trust account and Trust respectively), $55,000 that she took from a bank account in February 2012, $41,000 in patient checks that she took from James's business, and $69,000 she took from a TEC account (which add up to more than $404,000, indicating the court's calculation of the total was in error). Anne fails to address any of this evidence, which includes, for example, her own testimony that around June of 2013 she deposited into a bank account $289,186 of cashier's checks she took from the family residence and created the Trust; James's testimony that $55,000 of community funds was withdrawn, apparently by Anne, from a bank account in February 2012 without his knowledge; and Anne's and James's testimony that around April of 2013 Anne withdrew $69,000 from a TEC account without giving James prior notice of her withdrawal. Because she fails to address this evidence, Anne has waived her claim 28. (Chicago Title Ins. Co., supra, 188 Cal.App.4th at p. 415; Mendoza v. City of West Covina, supra, 206 Cal.App.4th at pp. 713-714.)
Anne's Claims 14 and 15
The trial court found that James withdrew post-separation $100,015 from his IRA in community funds that were ultimately reported to the Internal Revenue Service as income for which James paid taxes and penalties for early withdrawal, and that James's tracing evidence failed to account for the disposition of these community funds. The court ordered James to pay Anne $50,000. Also, the trial court found that James's and Anne's community property included a share in PESC, that James received postseparation $311,758 in PESC cash distributions, and that he did not share these distributions with Anne. The court ordered him to pay Anne $155,879.
In her claims 14 and 15, Anne argues the trial court erred in not ordering James to reimburse her 100 percent of the value of these IRA and PESC community funds because he took them in violation of his fiduciary duty to her, while ordering her to reimburse James 100 percent of certain funds the court found she took in violation of her fiduciary duty to him (see our discussion of Anne's claims 6 and 7 below). She further argues that the trial court abused its discretion by ordering her to pay "sanctions" of $103,338.90 to James for taking $202,165 in community funds while not ordering James to pay any sanctions for taking $421,317 in community funds, and that the trial judge was not impartial, as shown by the judge recusing herself from the case soon after issuing the FSOD. Anne fails to cite any evidence or legal authority to support her contentions. She has therefore forfeited her claims 14 and 15. (In re S.B., supra, 32 Cal.4th at p. 1293; In re S.C., supra, 138 Cal.App.4th at pp. 406-407; Cahill, supra, 194 Cal.App.4th at p. 956; Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684.) She also has not established that she raised her claim of judicial bias below, thereby forfeiting this claim as well. (People v. Farley (2009) 46 Cal.4th 1053, 1110 [failure to assert judicial bias below results in forfeiture on appeal].)
Anne's Claims 19, 20, and 22
In her claim 19, Anne argues the trial court erred in ordering her to pay James for his half-share of $193,734.12 in community funds that she held as of the date of separation. According to Anne, this $193,734.12 was included in the $289,186 the court found she also held as of the date of separation, the division of which the court also determined. She argues, "There was no evidence . . . that Anne had both $193,734.12 and $286,186 as of the date of separation.... To divide the $193,734.12 as if it were not already included in the $289,186 is error."
In her claim 20, Anne contends the trial court erred in ordering her under Family Code section 1101, subdivision (h) (which incorporates the punitive damages provisions of Civil Code section 3294) to pay the penalties, interest, and fees imposed on the community for its tax liability for the years 2011 to 2013. She argues the court exceeded its jurisdiction because it also ordered her to pay 100 percent of the amount it found she had taken. Therefore, she contends, its order that she also pay these penalties, interest, and fees constituted "a punishment greater than 100%."
In her claim 22, Anne contends the trial court erred by not ordering James to reimburse her $9,559, the amount of community funds he took from a 401(k) account after the date of separation. She further contends James should have been "punished" for taking these community funds just as she was punished for taking certain community funds.
Anne fails to identify where in the record she raised any of these claims below, and we have not found any indication that she did so. She also does not provide meaningful legal argument for any of these claims. As a result, she has forfeited claims 19, 20, and 22. (In re S.B., supra, 32 Cal.4th at p. 1293; In re S.C., supra, 138 Cal.App.4th at pp. 406-407; Cahill, supra, 194 Cal.App.4th at p. 956.)
Anne's Claim 30
In her claim 30, Anne contends the trial court erred by denying her renewed request during trial for funds to pay for experts and legal representation, and by denying her time to present rebuttal and impeachment evidence.
In its FSOD, the trial court found: "The Court did accord [Anne] an opportunity to present impeachment evidence by allocating equal amounts of trial time to both parties at the outset of trial and permitting them to devote it as they chose. [Anne's] counsel was repeatedly warned at trial about her waste of her allocated time. When [James] and his counsel did not use the entirety of their allocated trial time, the Court divided the remaining time in half over [James's] objection, resulting in [Anne] having more time to present her case. [Anne] exhausted her allocated trial time before presenting any rebuttal evidence. She expended the majority of her trial time on witnesses related to custody and visitation, when [James] offered an almost total concession of the issue of physical custody at the outset of trial."
Anne does not challenge these findings. Instead, she argues the trial court erroneously denied her request for funds for attorneys, as well as for experts to testify regarding the tracing of funds, the valuation of the parties' PESC share, the valuation of TEC, and the impeachment of James's experts. She contends the court's denial violated Family Code sections 2030, subdivision (a)(1) and 2031, subdivision (b), and denied her a fair trial.
Family Code section 2030, subdivision (a)(1) provides in relevant part, "In a proceeding for dissolution of marriage . . . the court shall ensure that each party has access to legal representation . . . to preserve each party's rights by ordering, if necessary based on the income and needs assessments, one party . . . whatever amount is reasonably necessary for attorney's fees and for the cost of maintaining or defending the proceeding during the pendency of the proceeding." Family Code section 2031, subdivision (b) provides that the trial court may make this order without notice by an oral motion in open court at the time of the hearing of the cause on the merits.
Anne also argues she was misled by a 2017 court order regarding the documents she could present at trial. According to Anne, "[w]hile the court's time estimates were to be respected, [her] lack of resources was such, the fact that she had been misled by the 7/7/2017 order early on about what documents she could present at trial, and the importance of the issues is such, that the court should have permitted her to present impeachment/rebuttal evidence, and awarded her some fees for experts-a ready source for which was the withheld PESC income."
Once more, Anne fails to present any legal authority in support of her contentions. She has, accordingly, forfeited her claim 30. (Cahill, supra, 194 Cal.App.4th at p. 956.) To the extent Anne may also be challenging the trial court's denials of her other requests for attorney and expert fees, we have already rejected her appeals from those rulings in case numbers A156538 and A155541/A156019. We take judicial notice of those previous opinions under Evidence Code sections 459 and 451, subdivision (a), and we decline to revisit any of the issues we resolved in those opinions.
II. Anne's Claim 2 is Moot
In her claim 2, Anne argues the trial court erred by ordering her to vacate the family residence before its sale.
"A case is moot when any ruling by this court can have no practical impact or provide the parties effectual relief." (Woodward Park Homeowners Assn. v. Garreks, Inc. (2000) 77 Cal.App.4th 880, 888.) In one of our prior unpublished opinions regarding this dispute, In re Tearse (Sept. 22, 2021, A158582) , we concluded that the parties had entered into an agreement stipulating that Anne would vacate the residence by January 16, 2021, and that she had vacated the residence, rendering her challenge to the court's order that she vacate the family residence moot. (In re Tearse, at pp. *1, *6.) Anne challenges the same order here. We take judicial notice of our previous opinion under Evidence Code sections 459 and 451, subdivision (a), and see no reason to depart from it.
Anne's claim 2 is moot and we shall dismiss that part of her appeal.
III. Anne's Other Claims
Anne's Claim 1
Anne challenges on multiple grounds the court's FSOD order that she reimburse James $281,057.63 for post-separation payments he made for Anne's health insurance premiums. Agreeing with Anne, we conclude there is insufficient evidence to support the trial court's order. We need not address all of the grounds for reversal she asserts because one of them is dispositive: The court improperly relied on a three-page summary of payments prepared by James, his "Exhibit M," that it admitted into evidence at trial over Anne's objection. The court should not have admitted Exhibit M because it was based on inadmissible hearsay. And the error was prejudicial because the only other relevant evidence, James's testimony, was insufficient to support the court's FSOD ruling. As a result, we will reverse the challenged $281,057.63 reimbursement order at issue in Anne's claim 1.
A. The Trial Proceedings
At trial, James testified that Exhibit M was a spreadsheet he generated that showed "family health care premiums" that he paid or would pay from January 1, 2013 through September 1, 2018. He said the spreadsheet contained six columns: the date of the payment; who was being paid; a "memo and description . . . with regard to who it was a benefit for"; the bookkeeping account designation at his business, which was "health insurance, self-employed"; the amount of the premium; and the running premium balance. Asked if the spreadsheet accurately reflected the "total amount" that he had paid "for health insurance" since the date of separation, he said it did and that the total amount was $286,608.88.
James's attorney requested that Exhibit M be admitted into evidence. Anne's attorney objected on the grounds that the exhibit was a compilation of information from other documents that had not been produced, and a violation of the hearsay and best evidence rules. The trial court overruled this objection and admitted the first three pages of Exhibit M (for which foundation had been established via James's testimony) based on Evidence Code section 1523, subdivision (d), which permits oral testimony to prove the content of voluminous writings.
Exhibit M's three-page spreadsheet is entitled, "Marriage of Tearse-Family Health Insurance 1/1/2013 to 9/1/18." The three pages contain 160 rows under six column headings that are consistent with James's testimony. "Blue Shield AP" is listed as the party paid in all 160 rows. Numerous rows dated from January 1, 2013 to September 2018, indicate monthly payments by James beginning at $3,678 and increasing to $4,860.25. For these rows, the name "Anne Tearse" is stated in the "Memo/Description" column. Numerous other rows list smaller monthly payments, for amounts that range from $18.26 to $172.77, with the name "Anne Tearse" also stated in the "Memo/Description" column. Finally, several rows list payments in 2015 and 2016 with the phrase "Anne Tearse Dental" stated in the "Memo/Description" column. None of these payments exceed $96.64.
In his closing arguments brief, James, relying on Exhibit M, requested a $301,190 credit for "Family Medical and Dental Insurance" paid by him from January 1, 2013 through December 31, 2018.
In its tentative and proposed statement of decision (TSOD), the trial court subtracted 38 payments listed in Exhibit M that state James's name under the column entitled "Memo/Description." It ruled that Anne was to reimburse James for the remainder of the payments listed in Exhibit M, meaning "$281,057.63 for [James's] post-separation payment of her health insurance premiums through September 1, 2018." The court further ruled that Anne reimburse James for each monthly health insurance premium James paid from October 1, 2018 through entry of judgment of dissolution, and reserved jurisdiction "over determination of the amount of reimbursement due and method of payment."
Anne objected to the court's tentative rulings. Among other things, she argued that "Exhibit M, on its face, does not show a list of [Anne's] health insurance premiums paid by [James] .... Exhibit M is labeled: 'Family Health Insurance 1/1/2013 to 9/1/18' (emphasis added). There was no evidence that . . . the amounts on the list were paid for [Anne's] health insurance." Anne also requested certain further clarifications.
The court adopted its tentative rulings in its FSOD. It declined to modify its rulings in response to Anne's objections.
B. Analysis
Anne argues six grounds for reversal of the trial court's FSOD health insurance premiums rulings. We review a court's decision to admit evidence under Evidence Code section 1523, subdivision (d) for abuse of discretion. (See Wolfen v. Clinical Data, Inc. (1993) 16 Cal.App.4th 171, 182 [regarding former Evidence Code section 1509, which in relevant part was repealed and replaced by section 1523, subdivision (d), see Stats. 1998, ch. 100, § 1].) To resolve this claim of error, we focus primarily on Anne's argument that the trial court erred in admitting Exhibit M over her hearsay objection.
Evidence Code section 1523, subdivision (d), the voluminous writings rule, states: "Oral testimony of the content of a writing is not made inadmissible by subdivision (a) [which provides that oral testimony is not admissible to prove the content of a writing] if the writing consists of numerous accounts or other writings that cannot be examined in court without great loss of time, and the evidence sought from them is only the general result of the whole." Courts have relied on Evidence Code section 1523, subdivision (d) to admit a summarizing writing along with oral testimony about it. (Schellinger Brothers v. Cotter (2016) 2 Cal.App.5th 984, 1008 ["And that such a writing may itself be admissible appears to be the rule"].) In other words, Evidence Code section 1523 allows the admission of oral testimony regarding the content of a writing that summarizes an overly voluminous amount of other writings, as well as the writing itself, in order to establish "the general result of the whole."
"[S]econdary evidence . . . must comply with the rules governing the admissibility of evidence generally, including relevance [citation] and the hearsay rule." (Dart Industries, Inc. v. Commercial Union Ins. Co. (2002) 28 Cal.4th 1059, 1070, fn. 2.) Here, relevant case law, although not directly on point, indicates that section 1523, subdivision (d) does not exempt James's oral testimony or the summarizing document from the rules prohibiting the admission of hearsay.
In Pajaro Valley Water Management Agency v. McGrath (2005) 128 Cal.App.4th 1093 (Pajaro Valley), the Agency sought to establish its damages with a declaration from its general manager that stated the total amount owed based on bills the public agency sent to defendant McGrath, to which a table summarizing the Agency's claimed damages was attached. (Id. at p. 1106.) McGrath made various objections to the declaration, including on hearsay grounds, all of which the trial court overruled. The court concluded that the Agency was "entitled to provide a summary calculation of damages to simplify the presentation," citing Evidence Code section 1521. (Pajaro Valley, at pp. 1106-1107, 1108.)
Evidence Code section 1521 provides: "(a) The content of a writing may be proved by otherwise admissible secondary evidence. The court shall exclude secondary evidence of the content of writing if the court determines either of the following: "(1) A genuine dispute exists concerning material terms of the writing and justice requires the exclusion. "(2) Admission of the secondary evidence would be unfair. "(b) Nothing in this section makes admissible oral testimony to prove the content of a writing if the testimony is inadmissible under Section 1523 (oral testimony of the content of a writing). "(c) Nothing in this section excuses compliance with Section 1401 (authentication). "(d) This section shall be known as the 'Secondary Evidence Rule.' "
The appellate court reversed on the ground that the general manager's declaration and the attached table summarized inadmissible hearsay-the underlying bills. (Pajaro Valley, supra, 128 Cal.App.4th at p. 1107.) The court explained that the secondary evidence rule contained in Evidence Code section 1521 did not exempt these summaries from the hearsay rule: "Section 1521 permits the introduction of 'otherwise admissible secondary evidence' to prove the contents of a writing. It does not excuse the proponent from complying with other rules of evidence, most notably, the hearsay rule. [Citation.] As applicable here, section 1521 means only that the Agency could introduce secondary evidence to establish the contents of bills if (1) the contents themselves were admissible, and (2) the secondary evidence was 'otherwise admissible.' ([Evid. Code,] § 1521, subd. (a).)
Here, the contents of the bills were hearsay. In the absence of a showing that they came within an exception, secondary evidence of their contents was no more admissible than the bills themselves, which is to say, not at all." (Pajaro Valley, at p. 1108, citing Dart Industries, Inc. v. Commercial Union Ins. Co., supra, 28 Cal.4th at p. 1070, fn. 2.) The court thought the original bills "might be admissible over a hearsay objection as business records (Evid. Code, § 1271) or perhaps official records (Evid. Code, § 1280), but to establish either exception would require a showing of the time and circumstances of the documents' creation. (Evid. Code, §§ 1271, 1280.) No such showing was attempted." (Pajaro Valley, at p. 1107.)
Pajaro Valley does not directly address Evidence Code section 1523, subdivision (d). But nothing in Evidence Code section 1523 or related case law indicates the Legislature intended that Evidence Code section 1523 exempt secondary evidence admissible under its provisions from the basic evidentiary rule prohibiting the admission of hearsay evidence, i.e., "evidence of a statement that was made other than by a witness while testifying at the hearing and that is offered to prove the truth of the matter stated." (Evid. Code, § 1200, subd. (a); see People v. Valencia (2021) 11 Cal.5th 818, 831 &fn. 12 ["Hearsay is an out-of-court statement offered to prove the truth of its content"].) In other words, Pajaro Valley indicates that, where testimony or a writing is proffered at trial to establish the content of other, voluminous writings under Evidence Code section 1523, subdivision (d), those other writings either must be admitted or admissible at trial, such as under an exception to the hearsay rule.
In principle, James does not contest that Pajaro Valley is pertinent here. Rather, he attempts to distinguish the present circumstances from those in Pajaro Valley by contending that, contrary to the general manager in Pajaro, "James testified as to the time and circumstances of the preparation of Exhibit M." But as a basis for distinguishing this case from Pajaro Valley, this testimony is woefully inadequate to overcome the hearsay rule.
In his testimony, James merely agreed that (1) he "generate[d]" Exhibit M, and (2) Exhibit M "accurately reflect[ed] how much [he] paid for health insurance since the date of separation." He did not testify about what documents or information Exhibit M was based on, that he had any personal knowledge about any such documents, or that he had any personal knowledge of the payments listed on Exhibit M. And it is not reasonable to infer his personal knowledge of these matters in light of his testimony that his business had a bookkeeping account designation for the payments, which suggests that others at his business may have reviewed the documents and made these payments (for which he then was charged). He failed to present someone with sufficient foundational knowledge of the origin of the information contained in these documents to sponsor their admission at trial.
James relies on three cases to support his contention that Exhibit M was properly admitted. These cases cut against him. They confirm our conclusion that the voluminous writings underlying any testimony or written summary must either have been admitted or have been admissible at trial. (See Vanguard Recording Society, Inc. v. Fantasy Records, Inc. (1972) 24 Cal.App.3d 410, 418-419 [affirming admission of a summary of "some 50,000 sales invoices" where it was "clear that the summary was prepared from admissible business records"]; Wolfen v. Clinical Data, Inc., supra, 16 Cal.App.4th at p. 182 [relying on Vanguard Recording Society, Inc.]; Heaps v. Heaps (2004) 124 Cal.App.4th 286, 293-294 &p. 294, fn. 5 [affirming admission of a "schedule of assets" from a general compilation of documents already admitted into evidence].)
The holdings in Vanguard Recording Society, Wolfen, and Heaps are consistent with courts' long-standing evaluation of whether underlying voluminous writings are admissible in determining issues related to the voluminous writings rule. (See, e.g., Glove Manufacturing Co. v. Harvey (1921) 185 Cal. 255, 261 [regarding former Evidence Code section 1509, holding that a summary of defendant's expenditures was properly admitted where defendant testified as to his personal preparation of the summary based upon his own review of the underlying bills, payments of which he had personal knowledge]; Exclusive Florists, Inc. v. Kahn (1971) 17 Cal.App.3d 711, 713 [concluding under former Evidence Code section 1509 that a summary of business records "is admissible in evidence upon a showing that the business records are entitled to admission in evidence . . ."].)
In sum, we conclude that the trial court erred by admitting Exhibit M and relying on it in its FSOD.
Although Anne does not raise the issue and we therefore we do not decide it here, we question whether it would have been proper for the court to use Exhibit M to sort out what James paid for Anne's health insurance premiums (as opposed to his own) because Evidence Code section 1523, subdivision (d) only allows the admission of such a summary to show "the general result of the whole."
We also conclude there was no other evidence of what James paid for Anne's health insurance premiums. James testified only that the total amount he paid for "family health care premiums" from January 1, 2013 through September 1, 2018, was $286,608.88. This is insufficient to support the court's order that Anne reimburse James "$281,057.63 for his postseparation payment of her health insurance premiums through September 1, 2018." (Italics added.) We will therefore reverse that order.
In light of our conclusion that the trial court's ruling is unsupported by the record, we need not and do not address James's claim that Anne has forfeited a part of her appellate claim regarding the payment of premiums for the couple's adult children. ~(RB 39-40)~ (See People v. Butler (2003) 31 Cal.4th 1119, 1126, quoting Tahoe National Bank v. Phillips (1971) 4 Cal.3d 11, 23, fn. 17 ["Generally, points not urged in the trial court cannot be raised on appeal. [Citation.] The contention that a judgment is not supported by substantial evidence, however, is an obvious exception to the rule"].)
Anne argues four additional grounds for reversal of all or part of the trial court's relevant orders. They are that the trial court (1) erred in ordering her to reimburse James for his payment of insurance premiums that he did not prove were paid with his separate income; (2) erred in charging her for James's gross payments of premiums that he purportedly deducted as business expenses; (3) lacked jurisdiction to charge her for health insurance after 11/22/2013, and (4) lacked jurisdiction to charge her the price her employer, TEC, paid for employee benefits.
In light of our conclusion that we must reverse the challenged FSOD health insurance premiums rulings on hearsay grounds, we have no need to consider Anne's additional arguments. But the trial court also ordered that Anne reimburse James "for each monthly health insurance premium paid from October 1, 2018, through entry of judgment of dissolution," and reserved jurisdiction over determination of the amount of reimbursement due and the method of payment. Because judgment was not filed until June 13, 2019, James may have made additional payments. Thus, for the sake of completing the analysis insofar as may be necessary to resolve all possible disputes about the issues falling within the ambit of Anne's claim 1, we conclude that each of these additional grounds for reversal was forfeited by Anne for failure to supply sufficient citations to the trial record and failure to develop a legal basis for the arguments on appeal. (Cahill, supra, 194 Cal.App.4th at p. 956; Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684.)
Anne's Claims 3, 4, and 5
Anne argues in claims 3, 4, and 5 that the trial court made multiple errors in allocating between the parties the responsibility for James's postseparation payments for what the court found were two HELOC's, Comerica accounts x5148 and x3672, as well as for any HELOC outstanding balance that existed at the time of judgment. Anne does not establish that there is a ground for reversal on any of these claims.
A. The Relevant Evidence Presented at Trial
At trial, James testified he made post-separation payments for a HELOC, otherwise unidentified, from 2013 through October 1, 2018, as indicated in a spreadsheet that was the first page of his Exhibit P, the rest of which consisted of a few dozen pages of Comerica statements. After Exhibit P was marked for identification purposes, James testified regarding the spreadsheet's contents.
James's testimony suggests he prepared the Exhibit P spreadsheet himself. He testified that by September 2018 (a few months after his testimony), he would have paid an estimated $46,266.57 in interest for the HELOC since January 2013, that he paid $12,395.10 in principal from January 2013 through December 2017, that he paid principal in January, February, March, and April of 2018 (indicated on the spreadsheet as $1197.43, $1172.27, $1178.38, and $1276.12 respectively), and that his estimated total principal payments from January 2013 through September 2018, would be $23,249.55. He further testified that he made all the payments listed on the spreadsheet other than those indicated to be estimates.
James's counsel requested that Exhibit P be admitted into evidence. Anne's counsel objected on the grounds that the exhibit was an inadmissible compilation and its admission would violate the best evidence and hearsay rules. The trial court overruled these objections on the ground that James's "statements that he's actually made the bill statements are not hearsay." The court further ruled that it would admit the spreadsheet "under [Evidence Code section] 1523, subdivision (d), given that to prove that each of the payments was made would result in [James] being required to provide the various forms of payment and authenticate each one, which would, in this case, occasion a great loss of time." The court continued, "So 1523. It's admitted. And I'm referring to the first page of the document only [the spreadsheet]. Exhibit P consists of a number of other documents, running to what looks to be 36 pages, which are not-the remaining balance are not admitted. Only the chart."
James further testified that he made post-separation withdrawals from the HELOC without seeking Anne's advance written consent. He could not recall how many times he made withdrawals, but said he "possibly" could have made withdrawals more than once. Asked what he did with the money he did withdraw, he said, "I brought it into the office to cover expenses. And as cash flow improved, I used it to pay back the line of credit."
He acknowledged that statements shown to him at trial indicated multiple withdrawals were made between the date of separation and August 1, 2015, but said he did not know if he or Anne made them or if any went into his office account.
James also was asked if he ever borrowed money on the home equity line of credit for his business. He said he did and explained that, "when we got to the point where, financially, the business was not supporting the home expenses, I transferred money from the home line of credit to the business . . . and used the money in the business, and then transferred the money back to the home to pay for home expenses." He further testified that he "withdrew money from the home credit line in order to cover cash flow problems at the business and being able to bring money home." He reimbursed the HELOC for a time "as cash came in. We paid-to pay it down. And then, as time progressed, we got to the point where we could not pay it off or pay it down."
James also testified that he prepared his Exhibit T, which includes a 35-page spreadsheet summarizing activity from January 1, 2013 through March 29, 2018, in Wells Fargo Bank account x7180, the title to which was in his name. The court admitted, under Evidence Code section 1523, subdivision (d) and with some qualifications, this 35-page spreadsheet, the last page of which lists the total deposits into the account for this period of time. As Anne points out, one column indicates that $56,100 of deposits were made into James's account from "Comerica Bk Home LOC 5148," thereby indicating he withdrew funds from that HELOC. In Exhibit T, James characterized these deposits as his separate property. When he testified at trial, however, James was asked to state the total amount of "community deposits" made into x7180, and in response he stated a total, "2 million 360-some thousand," that appears to include these deposits.
Anne testified that there had been a HELOC on the family residence for "[m]any" years, which HELOC she otherwise did not identify. She further testified, "Starting in May 2010, money from the HELOC went into the business account; and then, from the business account, it would pay back the HELOC."
B. The Trial Court's FSOD Rulings
In its FSOD, the trial court made multiple rulings that are pertinent here. The court found that the pre-deductions value of the family residence, a community asset, was $2,700,000. It also found that "[t]he parties agreed at the close of evidence that . . . the outstanding balance of the Comerica HELOC x5148 as of July 11, 2018 was $180,756.51." (Fn. omitted.) The court deducted this HELOC amount, as well as the outstanding balance on the family residence mortgage, from the value of the family residence. It ruled that the community's equity in the family residence after these deductions was $1,633,513.07, and awarded each party a one-half share worth $816,756.54.
In its FSOD, the trial court noted that Anne had objected to its ruling, as stated in its TSOD, on the grounds that the court omitted the factual and legal bases for its implied findings that the outstanding balance of the HELOC was community debt, that the HELOC existed as of the date of separation, and that the portion of the HELOC debt incurred post-separation without her consent should be allocated to her. The court indicated it specified its factual bases in subsections 12 and 13 of the FSOD.
In subsections 12 and 13 of the FSOD, however, the trial court relied not only on the spreadsheet contained in Exhibit P that it admitted into evidence, but also on the underlying Comerica statements that it expressly excluded from evidence. Based on these unadmitted statements, the court concluded there were two HELOC's, Comerica accounts x5148 and x3672, that as of January 11, 2013, x5148 had two different principal balances with different interest rates that totaled $198,395.19, and that "the principal balances on the HELOC ending x5148 increased annually in an amount consistent with the monthly finance charges on the unpaid principal balances, demonstrating that the parties were not continuing to utilize this HELOC for post-separation expenses." It ordered Anne to reimburse James for her one-half share of his post-separation payments of interest and principal regarding this community debt, amounts which totaled $27,386.57. It further ordered Anne to reimburse James one-half of any further interest and principal payments he made toward x5148, and reserved jurisdiction to determine the amount and method of payment for any ongoing reimbursement claim.
As for x3672, the trial court, again relying on the unadmitted Comerica statements, found that Exhibit P contained "monthly mortgage account statements documenting principal and interest paid from January 2018 through April 2018, and 1098s for interest paid in 2017." But the court rejected James's claim to reimbursement for HELOC principal and interest payments on Comerica x3672. Because James identified these HELOC payments as an indebtedness of TEC incurred to pay for business expenses when he had cashflow problems, the court concluded, there was insufficient evidence that these payments were community debt "rather than a post- separation reimbursement to the community for community funds use to pay business expenses on [James's] separate property business."
Elsewhere in its FSOD, the court found that the date of separation value of TEC was $458,537, but that TEC was encumbered with outstanding debt in various amounts at the time, including debt from a "Comerica home equity line of credit account ending x3672 with an outstanding balance of $198,769.79," which James "testified at trial he used . . . to fund the business." The court subtracted all of this outstanding date of separation debt from TEC's value, leaving a date of separation net value for TEC of $3,181.60. Since this value was less than James's initial separate property contribution into his business at the time of marriage, which the court found to be $283,011, the court awarded TEC to James as his separate property at zero value without awarding Anne anything for whatever part of a community interest she may have had in the business, and assigned all of the outstanding debt it had identified to James as his alone.
C. Anne's Claim 3 Arguments
1. Anne's Arguments Regarding x5148
First, Anne argues in her claim 3 that the trial court erred by allocating to her one-half of the outstanding balance for x5148 as her part of a community debt and deducting it from her equity interest in the family residence. Rather than challenge the trial court's reliance on the unadmitted statements contained in Exhibit P, she too discusses them, noting that there are no Comerica statements for x5148 after January 13, 2017. Without any such statements, she contends, "there is no evidence that x5148 [was] a community debt or existing debt after 1/13/2017. There is therefore no basis for allocating any of the x5148 debt to Anne or deducting it from proceeds from the sale of the home." She further contends there is no evidence that James used all of his post-separation withdrawals from x5148 for community purposes or that he paid them back, including with interest.
James responds that Anne's testimony and the Comerica statements contained in Exhibit P (which, again, were not admitted into evidence) support the trial court's conclusion that the HELOC was taken out before the date of separation and, therefore, was community property, and that, as the court found, the bank statements in Exhibit P indicate the parties did not continue to use this HELOC for post-separation expenses.
In other words, the trial court and the parties, in all of their respective discussions about x5148, rely heavily on Comerica statements included in Exhibit P that the trial court expressly excluded from evidence. In determining whether substantial evidence supports the trial court's ruling, we cannot and will not consider any of these unadmitted Comerica statements. (See Frank v. County of Los Angeles (2007) 149 Cal.App.4th 805, 815 ["It is axiomatic that in reviewing the liability aspect of a judgment based on a jury verdict, we may not review exhibits identified, but not admitted at trial"]; USLIFE Savings &Loan Assn. v. National Surety Corp. (1981) 115 Cal.App.3d 336, 343 ["[D]ocuments . . . urged by a party which are not admitted into evidence . . . are outside the scope of review"]; Western Aggregates, Inc. v. County of Yuba (2002) 101 Cal.App.4th 278, 292 [improper to consider unadmitted exhibits on appeal because their "foundation had not been tested in the trial court"]; People v. Cordova (2015) 62 Cal.4th 104, 137 [exhibit that the trial court refused to admit into evidence was not evidence in the case].)
Even without consideration of the unadmitted Comerica statements, Anne's argument that there is insufficient evidence to support the trial court's conclusion that x5148 was a community obligation, her share of which should be deducted from her equity interest in the family residence, is unpersuasive in light of the evidence that was admitted at trial. Under our substantial evidence standard of review, we must "draw[] all reasonable inferences in support of the findings." (Thompson v. Asimos (2016) 6 Cal.App.5th 970, 981.) It can be reasonably inferred from Anne's and James's testimony, and James's Exhibit T, which referenced x5148, that they had one HELOC that started prior to their date of separation, x5148. It is reasonable to infer from this evidence that x5148 started prior to the date of separation and, therefore, that it was a community obligation. Further, in its FSOD, the trial court found that the parties agreed at the end of the trial that the outstanding balance for x5148 was $180,756.51 as of July 11, 2018. Anne does not challenge this finding on appeal.
Anne contends that at least some part of x5148's outstanding balance was due to James's post-separation separate expenditures, but does she not cite evidence that establishes this to be the case. For example, she cites to just six listings in James's Exhibit T, a 28-page exhibit containing many hundreds of listings of post-separation activity into Wells Fargo Bank account x7180, an account that was in his name, contending these six listings show James used x5148 funds post-separation for his separate purposes. We will not search the record based on her insufficient citation to it. (Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684.) And regardless, her summary descriptions of these listings (she contends that "James used the money for non-necessities, including, for instance to 'charity,' 'hobbies,' 'maid' [']sporting goods,' 'entertainment,' 'amusement,' etc., and deposits into savings he designated as 'Husband' ") fail to establish the activity was not for the community.
Similarly, Anne correctly points out that James testified to withdrawing funds from the HELOC on one or more occasions to cover his business expenses, and also testified that, "as cash flow improved, [he] used it to pay back the line of credit." We agree that this raises questions about James's use and repayment of HELOC funds post-separation for community obligations (as we do in addressing Anne's claims 4 and 5 below, where we conclude there is insufficient evidence to support the trial court's order that Anne reimburse James one-half of his post-separation payments of principal and interest for x5148). But here the testimony cited by Anne is too vague regarding the timing of James's withdrawal activity, the amounts he withdrew, and the amounts he paid back to reverse the court's order that x5148's outstanding balance as of July 11, 2018, was a community obligation.
We will therefore affirm the trial court's FSOD order deducting Anne's one-half share of the x5148 outstanding balance of $180,756.51 from her equity interest in the family residence.
While Anne attacks the deduction of these HELOC repayments from her share of the value of the marital home, James claims in his cross-appeal that the deduction was not enough. James contends, based on the unadmitted Comerica statements contained in Exhibit P, that the x5148 debt was moved into x3672 sometime in 2017, that thereafter x5148 had a zero balance, and that x3672 contained the parties' HELOC community debt. We address his argument in resolving his cross-appeal. Because he relies on unadmitted evidence, we reject it, as we further explain in our discussion below of James's Claim III.
2. Anne's Arguments Regarding x3672
a. There Is Insufficient Evidence To Support the Deduction of x3672's Outstanding Balance from TEC's Date of Separation Value
Anne argues in claim 3 regarding x3672 that the trial court erred by deducting the purported outstanding balance in x3672 from the date of separation value of James's business, TEC, in determining that she was not due any money for whatever part of a community interest she may have had in that business. She contends there is no evidence that x3672 is not the same x5148 debt, had an outstanding balance of $198,769.79 as of the date of separation, or even existed as of the date of separation. James replies that the trial court erred in finding there were two HELOC's, since the Exhibit P Comerica statements (again, which were not admitted into evidence) indicate that there was only one HELOC, x5148, the debt for which appears to have been moved into another account, x3672, at some point in 2017.
We agree with Anne that there is insufficient evidence to support the court's conclusion that there was a separate HELOC, x3672, which outstanding balance at the time of separation should be deducted from TEC's value at that time. We do so for the simple reason that the court relied for this conclusion on the unadmitted Exhibit P Comerica statements. Again, we cannot and shall not consider these statements because they were not admitted into evidence. (See Frank v. County of Los Angeles, supra, 149 Cal.App.4th at p. 815; USLIFE Savings &Loan Assn. v. National Surety Corp., supra, 115 Cal.App.3d at p. 343; Western Aggregates, Inc. v. County of Yuba, supra, 101 Cal.App.4th at p. 292; People v. Cordova, supra, 62 Cal.4th at p. 137.) Aside from these statements, the parties have not cited, and we have not found, any evidence of the existence of x3672. Therefore, we conclude the court erred in deducting the outstanding balance of that account from the net value of James's business as of the date of separation.
b. Anne Fails To Show She Was Prejudiced by the Trial Court's Error
Nonetheless, the trial court's error here does not require reversal because Anne fails to show it was consequential to the court's determination that she was not entitled to anything for whatever part of a community interest she may have had in James's business.
" 'The burden is on the appellant in every case to show the claimed error is prejudicial; i.e., that it has resulted in a miscarriage of justice.'" (In re Marriage of McLaughlin (2000) 82 Cal.App.4th 327, 337.) When insufficient evidence supports a court finding regarding a ruling that is supported by other evidence, a court should sustain the ruling. (Maloney v. White (1960) 182 Cal.App.2d 787, 789.)
"[I]n California, property acquired prior to marriage is separate, while property acquired during the marriage is presumed community property. [Citations.] Income from separate property is separate, the intrinsic increase of separate property is separate, but the fruits of the community's expenditures of time, talent, and labor are community property." (Dekker, supra, 17 Cal.App.4th at p. 850.) "Where community efforts increase the value of a separate property business, it becomes necessary to quantify the contributions of the separate capital and community effort to the increase. [Citation.] It is well settled in California that income produced by an asset takes on the character of the asset from which it flows. Thus . . . profits are community property if derived from community assets, and separate property if derived from separate assets." (Id. at p. 851.)
"In Pereira v. Pereira [(1909) 156 Cal. 1, 7], the California Supreme Court first announced the rule that where a husband owns a separate property business and devotes his efforts to the enterprise, there must be an apportionment of the profits." (Dekker, supra, 17 Cal.App.4th at p. 851.) "Viewing the language cited in Pereira in light of California's partnership model of marriage, the necessity of apportionment arises when, during marriage, more than minimal community effort is devoted to separate property business." (Ibid., fn. omitted.) "The community is entitled to the increase in profits attributable to community endeavor. [Citations.] Accordingly, courts must apportion profits derived from community effort to the community, and profits derived from separate capital are apportioned to separate property." (Id. at pp. 851-852, fn. omitted.)
"California courts have developed two alternative approaches to allocating business profits. The Pereira approach is to allocate a fair return to the separate property investment and allocate the balance of the increased value to community property as arising from community efforts. [Citations.] The Van Camp approach is to determine the reasonable value of the community's services, allocate that amount to community property and the balance to separate property." (Dekker, supra, 17 Cal.App.4th at pp. 852853, fn. omitted.) "[C]ourts have not developed a precise standard in choosing between Pereira or Van Camp, but have endeavored to adopt that formula which is most appropriate and equitable under the circumstances." (Id. at p. 853.)
Named after Van Camp v. Van Camp (1921) 53 Cal.App. 17.
Here, the trial court, in determining the separate property and community interests in James's business, found that James "acquired the medical practice [TEC] prior to marriage, but both he and [Anne] devoted substantial community effort to the business during marriage. Community interests increased the value of the practice, and the Court is required to equitably apportion the increase in value between the community and separate property. In the case of a professional practice such as the one here, business profits during marriage were primarily attributable to [James's] labor, a community asset. The Pereira method would normally be the appropriate method of apportionment." (Fn. omitted.)
As we have discussed, the trial court found that when the parties married, TEC, which was James's separate property as of the date of marriage, had a value of $283,011. The court found TEC's gross value as of the date of separation to be $458,537, but that it also had significant encumbrances, including an outstanding balance in x3672 of $198,769.79, reducing its net value as of the date of separation to $3,181.60. Because this net value was far less than TEC's value as of when the parties married, the court awarded TEC to James "as his sole and separate property at a zero value," and did not award Anne anything for whatever part of a community interest she may have had in TEC.
We see no basis to question that logic. Adding back $198,769.79, the amount the trial court improperly deducted for the unproven outstanding balance in the x3672 HELOC, to TEC's date of separation net value increases that value to $201,951.39. But this is still $81,059.61 less than what the court found was TEC's value as of when the parties married, $283,011. Accordingly, even taking the incorrect deduction into account, Anne still would not be entitled to compensation for her share of whatever part of a community interest she may have had in TEC. Thus, the $201,951.39 deduction was error, but it was not reversible error because Anne fails to show prejudice.
We also address below the trial court's valuation of TEC in our discussion of Anne's claim 8 and the court's application of the x3672 outstanding balance in our discussion of James's Claim III argument.
D. Anne's Claims 4 and 5 Arguments
Anne argues in her claims 4 and 5 that the trial court erred in charging her with one-half of James's post-separation principal and interest payments for x5148. James responds to Anne's arguments by embracing the reasons given by the trial court for its rulings. He contends the court correctly concluded that "there were no draws after separation" and, so, "it naturally follows the principal and interest are community obligations." He further argues that Anne has forfeited her claim that he used x5148 post-separation as his "personal piggy bank" by her failure to cite anything in the Exhibit P statements that supports her claim.
Without endorsing Anne's tendentious rhetoric, we agree with her in substance. James, who was seeking the reimbursement, did not meet his burden below of proving his payments were for the community rather than for his separate purposes (similarly, Anne did not meet her burden as appellant of showing the trial court erred in concluding the x5148 outstanding balance was a community obligation to be deducted from the equity value of the family residence that was to be divided between the parties, as we discussed in addressing her x5148 arguments in her claim 3 above). There is no substantial evidence to support the court's determination on this point.
In attempting to defend the court's rulings, James relies on the unadmitted statements included in Exhibit P, which, again, we cannot and do not consider. (See Frank v. County of Los Angeles, supra, 149 Cal.App.4th at p. 815; USLIFE Savings &Loan Assn. v. National Surety Corp., supra, 115 Cal.App.3d at p. 343; Western Aggregates, Inc. v. County of Yuba, supra, 101 Cal.App.4th at p. 292; People v. Cordova, supra, 62 Cal.4th at p. 137.) Because these statements were not admitted, James's contention that Anne has forfeited her claim by failing to support it with citations to particular statements is not relevant. Absent record evidence of the statements, we are left with nothing but the following: (1) as indicated in the spreadsheet contained in Exhibit P that was admitted into evidence, James made certain post-separation interest and principal payments for what he and Anne considered to be one HELOC; (2) as indicated on Exhibit T, James made postseparation withdrawals from HELOC x5148 of $56,100 and deposited these funds in his own account; (3) according to his own testimony, James made one or more post-separation HELOC withdrawals that he used in his business "to cover expenses" and, as cash flow improved, paid back those withdrawals; and (4) at some unspecified point in time, James withdrew money from the HELOC, used it to cover cash flow problems at TEC, and was then able to have money to pay for home expenses. On this sparse record, we discern insufficient evidence to support the trial court's conclusion that James's post-separation HELOC interest and principal payments regarding x5148 were for a community debt. Accordingly, we conclude the court erred by charging Anne for one half of these payments, and we will reverse that part of the trial court's FSOD.
Anne's Claim 6
The trial court found that James demonstrated prima facie that Anne withdrew $55,000 in community funds from a bank account during their marriage (on February 1, 2012) without his knowledge or consent and thereafter controlled them, and that Anne failed to account for these funds in violation of the court's multiple orders for an accounting. The court concluded pursuant to In re Marriage of Prentis-Margulis and Margulis (2011) 198 Cal.App.4th 1252 (Prentis-Margulis) that Anne, not James, had the burden of accounting for the disposition of these funds and that she failed to prove she used them for community purposes. The court further ruled that Anne breached her fiduciary duty to James by her transfer of the funds without his knowledge and her failure to subsequently account for them on request. It ordered her to reimburse him $55,000 pursuant to Family Code section 1101, subdivision (h).
Anne argues the trial court erred in finding her transfer of $55,000 was a breach of fiduciary duty and in ordering her to pay James that amount because (1) she did ultimately comply with its order for an accounting; and (2) the court should not have shifted the burden of proof to her pursuant to Prentis-Margulis, supra, 198 Cal.App.4th 1252 because James did not make a prima facie showing that the $55,000 she withdrew during the marriage was in her control post-separation.
In Prentis-Margulis, a husband and wife separated and continued for 12 years to handle their joint finances as before. (Prentis-Margulis, supra, 198 Cal.App.4th at p. 1257.) At a subsequent marital dissolution trial, the wife contended the husband should be charged with many hundreds of thousands of dollars of missing community funds that had been in his postseparation control based on a nine-year-old financial statement he had prepared. (Id. at pp. 1260-1263.) The trial court concluded the financial statement was insufficient evidence to support the wife's contentions and declined to charge the husband with more than a small portion of the missing funds. (Id. at pp. 1262-1263.) It also concluded the husband breached his fiduciary duty to the wife to maintain proper records of all community assets over which he had exclusive control and management, and ordered him to pay the wife $20,000 in sanctions and $30,000 as a share of her attorney fees and costs. (Id. at p. 1265.)
The appellate court, upon reviewing relevant Family Code sections, equitable principles, and case law, concluded the trial court erred by not shifting to the husband the burden of proof concerning the missing community assets. (Prentis-Margulis, supra, 198 Cal.App.4th at pp. 1257-1258.) The appellate court reviewed cases in other areas of the law where burden-shifting was employed and concluded," '" 'Where the evidence necessary to establish a fact essential to a claim lies peculiarly within the knowledge and competence of one of the parties, that party has the burden of going forward with the evidence on the issue although it is not the party asserting the claim.'" '" (Id. at p. 1268.) The court also thought the statutory duties of disclosure and accounting owed between spouses further justified its ruling. (Ibid.) It held, "[O]nce a nonmanaging spouse makes a prima facie showing concerning the existence and value of community assets in the control of the other spouse postseparation, the burden of proof shifts to the managing spouse to rebut the showing or prove the proper disposition or lesser value of these assets. If the managing spouse fails to meet this burden, the court should charge the managing spouse with the assets according to the prima facie showing." (Prentis-Margulis, supra, 198 Cal.App.4th at p. 1267.)
Anne argues the trial court improperly relied on the Prentis-Margulis burden-shifting formula even though the evidence left a question as to whether, on the date of separation, she still held the $55,000 in community funds that she took during the marriage. James responds that Prentis-Margulis applies here because, although it involved a husband who did not account for post-separation community funds, its analysis indicates its burden-shifting formula can apply to circumstances that precede the date of separation.
We need not and do not determine whether Prentis-Margulis applies here because that case is not the basis of the trial court's decision to place the burden of proof regarding these funds on Anne. Unlike in Prentis-Margulis, there is no dispute here over the amount of money involved. Anne does not challenge the trial court's findings that she took the $55,000 without James's knowledge. As for her claim that the court erred in finding she did not account for these funds, she cites only the testimony of one of James's attorneys in the litigation, who said he received from Anne's attorney in 2014 "various pages of things like photocopies of checks or bank statements," and "wasn't quite sure what it was supposed to represent," none of which indicates Anne accounted for the funds. These findings are the bases for the court's ruling that she breached her fiduciary duties to James and must pay him $55,000, a ruling that is very similar to the ruling of the trial court in Prentis-Margulis that the husband pay certain penalties to his wife for his breach of his fiduciary duty to her, independent of the burden-shifting employed by that court.
The trial court found "that [Anne's] transfer of the funds without [James's] knowledge and failure to subsequently account for them on request breached her fiduciary duty to [James]. The Court awards [James] 100% of the transferred asset pursuant to Family Code [section] 1101[, subdivision] (h). [Anne] owes [James] reimbursement of $55,000."
The law regarding such a breach of fiduciary duty does not implicate the Prentis-Margulis burden-shifting formula. "The existence and scope of a fiduciary duty is a question of law that we review de novo. [Citation.] However, 'the factual background against which we [answer that question] is a function of a particular case's procedural posture.' [Citation.] Thus, to the extent the court's decision below 'turned on the resolution of conflicts in the evidence or on factual inferences to be drawn from the evidence, we consider the evidence in the light most favorable to the trial court's ruling and review the trial court's factual determinations under the substantial evidence standard. [Citation.]' [Citation.] Where there is a fiduciary duty, breach of the duty is a question of fact. [Citation.] We review the trier of fact's finding a breach occurred for substantial evidence, resolving all conflicts and drawing all reasonable inferences in favor of the decision." (In re Marriage of Kamgar (2017) 18 Cal.App.5th 136, 144.)
Family Code section 1100 specifies that, subject to exceptions that are not applicable here, each spouse is mutually entrusted with full individual authority to manage and control community property, including disposing of or otherwise alienating it. (Fam. Code, § 1100, subd. (a).) But each spouse also mutually owes the other a fiduciary duty with respect to the property under subdivision (e), which provides: "Each spouse shall act with respect to the other spouse in the management and control of the community assets and liabilities in accordance with the general rules governing fiduciary relationships which control the actions of persons having relationships of personal confidence as specified in [Family Code] Section 721, until such time as the assets and liabilities have been divided by the parties or by a court. This duty includes the obligation to make full disclosure to the other spouse of all material facts and information regarding the existence, characterization, and valuation of all assets in which the community has or may have an interest . . . and to provide equal access to all information, records, and books that pertain to the value and character of those assets and debts, upon request." (Fam. Code, § 1100, subd. (e), italics added.) Subject to exceptions not pertinent here, "in transactions between themselves, spouses are subject to the general rules governing fiduciary relationships that control the actions of persons occupying confidential relations with each other," which includes "[r]endering upon request, true and full information of all things affecting any transaction that concerns the community property and "[a]ccounting to the spouse, and holding as a trustee, any benefit or provide derived from any transaction by one spouse without the consent of the other spouse that concerns the community property." (Fam. Code, § 721, subds. (b), (b)(2) &(b)(3).)
"A spouse has a claim against the other spouse for any breach of the fiduciary duty that results in impairment to the claimant spouse's present undivided one-half interest in the community estate ...." (Fam. Code, § 1101, subd. (a).) "A court may order an accounting of the property and obligations of the parties to a marriage and may determine the rights of ownership in, the beneficial enjoyment of, or access to, community property, and the classification of all property of the parties to a marriage." (Fam. Code, § 1101, subd. (b).)
"Remedies for a breach of the fiduciary duty by one spouse, as set forth in [Family Code] Sections 721 and 1100, when the breach falls within the ambit of Section 3294 of the Civil Code shall include, but not be limited to, an award to the other spouse of . . . an amount equal to 100 percent[] of any asset undisclosed or transferred in breach of the fiduciary duty." (Fam. Code, § 1101, subd. (h).) Civil Code section 3294 includes within its ambit "[f]raud," which is defined as "an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury." (Civ. Code, § 3294, subd. (c)(3).)
These statutory rules regarding a spouse's fiduciary duties and breach of those duties are not limited to post-separation; they also apply during the marriage as well. (Fam. Code, § 1101, subd. (f) ["Any action may be brought under this section without filing an action for dissolution of marriage, legal separation, or nullity . . ."]; In re Marriage of Simmons (2013) 215 Cal.App.4th 584, 593 ["section 1101, subdivision (f) provides that the section 1101(h) remedy may be pursued in an action even when the parties have not filed for dissolution"], cited favorably in In re Marriage of Schleich (2017) 8 Cal.App.5th 267, 278-279 (Schleich).)
Anne does not challenge the trial court's authority to remedy a fiduciary violation of this nature or effectively rebut the court's discretionary decision to order that she reimburse James $55,000 for the breaches of fiduciary duty it found, i.e., her seizure of the funds in February 2012 without James's knowledge and her subsequent failure to account to him for these funds. Thus, we will affirm the trial court's order.
Anne's Claim 7
The trial court found that Anne withdrew $69,000 from a Comerica account of James's business, TEC, without James's knowledge or consent, which resulted in James terminating her employment at TEC; that the funds Anne withdrew were community property; and that Anne never accounted for these funds to James or to the court despite being ordered to provide an accounting. The court ruled that Anne seized this $69,000 in violation of her fiduciary duty to James and committed fraud within the ambit of Civil Code section 3294. Based on this finding, it ordered Anne to reimburse James $69,000 for her misappropriation of community funds.
Anne argues the trial court erred in so ruling, based on her testimony that she withdrew the $69,000 because James was "spending like crazy" on TEC's move from a previous location, was exceeding the agreed-upon budget for remodel and moving expenses, and, Anne believed, was planning to purchase new equipment instead of paying taxes. Anne argues her testimony shows she was acting consistent with her fiduciary duty to protect community funds for the payment of taxes or other community uses from James's squandering rather than committing fraud, and that under the circumstances she could not tell James in advance of her withdrawal. She further contends that she did not conceal her withdrawal, as indicated by her writing a check made out in her name from the business's account, and points out that James discovered the withdrawal the same day she withdrew the money. She concludes, "The substantial evidence is that Anne did not breach her fiduciary duty by withdrawing $69,000."
Anne's contentions amount to an inappropriate request that we reweigh the evidence and second-guess the court's views of the credibility of her and James's testimony on this issue. We decline to do so. "In reviewing factual determinations for substantial evidence, a reviewing court should 'not reweigh the evidence, evaluate the credibility of witnesses, or resolve evidentiary conflicts.' [Citation.] The determinations should 'be upheld if . . . supported by substantial evidence, even though substantial evidence to the contrary also exists and the trial court might have reached a different result had it believed other evidence.' [Citations.] Uncontradicted testimony rejected by the trial court' "cannot be credited on appeal unless, in view of the whole record, it is clear, positive, and of such a nature that it cannot rationally be disbelieved." '" (In re Caden C. (2021) 11 Cal.5th 614, 640.) The evidence is undisputed that Anne took the funds without James's knowledge and consent. The court could reasonably conclude her withdrawal of the funds from the business's bank account was a breach of her fiduciary duty to James that she accomplished by intentionally concealing her actions, thereby constituting fraud by concealment. (Civ. Code, § 3294, subd. (c)(3).)
Anne further argues that, contrary to the trial court's finding, she did account for the money, contending that declarations submitted by James and her attorney in 2013 indicate she spent the $69,000 on legal expenses. This too is unpersuasive because Anne does not establish by any citation to the record that either declaration was introduced or treated as evidence at trial. We will not consider this argument further. (Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684.)
But Anne presses on. As she did regarding her claim 6, discussed above, Anne cites the testimony of one of James's attorneys during the litigation. The attorney testified that he received from Anne's attorney in 2014 "various pages of things like photocopies of checks or bank statements," and "wasn't quite sure what it was supposed to represent." Nothing in his testimony indicates that Anne accounted for the $69,000.
Finally, Anne offers a one-sentence argument, unadorned by record citations or legal authority, that the trial court denied her the opportunity to present impeachment evidence on this issue because the court ended the trial right after James finished his presentation. She has waived this argument for failure to provide any supporting citations. (Cahill, supra, 194 Cal.App.4th at p. 956; Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684.) The basis for finding forfeiture is actually twofold. In addressing Anne's claim 30 above, we have already concluded that she has forfeited this argument.
Anne's Claim 8
In our discussion of Anne's claim 3 above, we discussed the trial court's findings that the value of James's business, TEC, at the date of separation, net of its encumbrances, was only $3,181.60, substantially less than its value of $283,011 as of the date of marriage. Based on these findings, the court did not award Anne anything for whatever part of a community interest she may have had in TEC as of the date of separation. In our discussion of Anne's claim 3 above, we determined the trial court erred in deducting the outstanding balance of the unproven x3672 HELOC, $198,769.79, from the net value of TEC as of the date of separation, and concluded that the trial court should have found TEC's net value to be $201,951.39.
In her claim 8, Anne argues the trial court erred in accepting James's position that $68,578.36 in loans he withdrew from several 401(k) accounts that were in his or Anne's name was among TEC's business encumbrances, which led to the court also deducting that amount from TEC's net value as of the date of separation. Anne correctly points out that the court's acceptance of James's position here conflicted with its finding elsewhere in the FSOD that James's withdrawals were used for community expenses, and with the court's not ordering that James repay these withdrawals before distribution of the 401(k) accounts. According to Anne, these flaws in the court's reasoning led to its improper deduction of $68,578.36 from the net value of TEC, thereby improperly reducing her equalizing payment by $68,578.36.
The court assigned the loans to James as his separate liability, a ruling which Anne does not challenge.
We need not resolve the merits of Anne's argument on this point because, assuming for the sake of argument she is correct, the error was not prejudicial to her. As a result, no reversal is required. Again," '[t]he burden is on the appellant in every case to show the claimed error is prejudicial; i.e., that it has resulted in a miscarriage of justice.'" (In re Marriage of McLaughlin, supra, 82 Cal.App.4th at p. 337.) When insufficient evidence supports a court finding regarding a ruling that is supported by other evidence, a court should sustain the ruling. (Maloney v. White, supra, 182 Cal.App.2d at p. 789.)
Here, Anne fails to show it mattered that the trial court may have erred in determining she was not due anything for whatever part of a community interest she may have had in TEC as of the date of separation. This is because her essential complaint is that the court improperly deducted $68,578.36 from TEC's net value as of that date. In addressing Anne's claim 3, we determined that the court should have found TEC's net value as of the date of separation to be $201,951.39, substantially less than the court's determination of the value of TEC as of the date of marriage, $283,011. As noted above, even if we were to add $68,578.36 to TEC's net value of $201,951.39 as of the date of separation, the revised net value would only be $270,529.75, still less than TEC's value as of the date of marriage. We therefore conclude any error was harmless and affirm the court's ruling that Anne recover nothing from whatever part of a community interest she may have had in TEC as of the date of separation.
Anne's Claims 10, 11, and 12
Anne next challenges the trial court's FSOD rulings that she reimburse James 100 percent of the tax penalties and interest he paid regarding the community's delinquent taxes for the years 2011, 2012, and 2013. The court ordered Anne to reimburse James under Family Code section 1101, subdivision (h) based on her breach of her fiduciary duty to James. We reject Anne's challenges to these rulings.
The trial court ruled that Anne breached her fiduciary duty to James by her concealment of community funds. As we have discussed, these community funds were comprised of $289,186 of cashier's checks Anne placed in the Trust account, $55,000 in community funds that she took from a bank account in February 2012, $41,000 in patient checks that she took from James's business, TEC, and $69,000 she took from a TEC account. The court concluded that her concealment of these funds caused James to pay community tax penalties and interest, and ordered as a remedy that she reimburse James for his payment of $23,415.07 for 2011, $11,901 for 2012, and $8,666 for 2013.
As we also have already discussed in addressing Anne's claims 4 and 5 above, Family Code section 1100, subdivision (e) requires that spouses act as fiduciaries to each other in their management and control of community assets and liabilities, in accordance with the general rules governing fiduciary relationships specified in Family Code section 721. Family Code section 721, subdivision (b) provides, subject to exceptions not relevant here, "in transactions between themselves, spouses are subject to the general rules governing fiduciary relationships that control the actions of persons occupying confidential relations with each other," including rules requiring the disclosure of true and full information regarding community property. (Fam. Code, § 721, subd. (b)(1)-(3).)
Family Code section 1101 governs remedies for a spouse's breach of fiduciary duty to a spouse under Family Code sections 1100 and 721 "that results in impairment" to the claimant spouse's one-half interest in the community estate, including transactions that "have caused or will cause a detrimental impact" to that interest. (Fam. Code, § 1101, subd. (a).) "[W]hen the breach falls within the ambit of Section 3294 of the Civil Code," remedies "shall include, but not be limited to, an award to the other spouse of 100 percent, or an amount equal to 100 percent, of any asset undisclosed or transferred in breach of the fiduciary duty." (Fam. Code, § 1101, subd. (h).) We review a trial court's ruling regarding the appropriate remedy for a breach of fiduciary duty for abuse of discretion. (See Schleich, supra, 8 Cal.App.5th at p. 284.)
Civil Code section 3294, subdivision (a) provides, "In an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant."
A. Anne's Claim 10 Arguments
In her claim 10, Anne asserts four reasons why the court erred in ordering her to reimburse James for his payment of $23,415.07 in tax penalties and interest imposed for the failure to timely pay 2011 taxes.
First, she contends the order is without a factual basis because it is based on what James was charged and what he paid as indicated in his Exhibit PP, which was not admitted into evidence. Anne's contention is unpersuasive because, regardless of Exhibit PP, James's own testimony was that he paid this amount in penalties and interest, which provides substantial evidence for the court's order. (See Western States Petroleum Assn. v. Superior Court (1995) 9 Cal.4th 559, 571 [" 'when a [finding] is attacked as being unsupported, the power of the appellate court begins and ends with a determination as to whether there is any substantial evidence, contradicted or uncontradicted, which will support the [finding]' "].)
Second, Anne argues the trial court erred because James's failure to pay the 2011 taxes when they were initially due, which later led to the incurring of penalties and interest, had nothing to do with anything she did. We fail to see the relevance of this argument. The court's order was based on its finding that Anne's concealment of funds impaired James's ability to pay the 2011 taxes, thereby causing him to pay penalties and interest imposed years later for the community's failure to pay those taxes. Nothing Anne argues provides a response to this finding or in any way undermines it. The court gave the forced impairment of James' ability to pay his 2011 taxes significant weight, as indicated by its denial of James's request for reimbursement of tax penalties and interest imposed in November 2012, before the date of separation, Anne's creation of the Trust, and her taking of funds from TEC.
Third, Anne argues there is no substantial evidence that she could have paid the 2011 taxes because the funds she had access to were only sufficient for her to pay her living expenses and make court-ordered pretrial payments. And fourth, she argues there is evidence that James could have paid the 2011 taxes sooner.
These arguments ignore the trial court's determination that Anne concealed a large amount of community funds, over $400,000, from which the court could reasonably infer under the totality of the circumstances that she impaired James's ability to pay the 2011 taxes. Regardless of her other contentions-which themselves are not necessarily established by the evidence-she fails to explain why the trial court's determination is not supported by substantial evidence or to consider that we must, under our substantial evidence standard of review, resolve all conflicts and draw all reasonable inferences in favor of the decision. (In re Marriage of Kamgar, supra, 18 Cal.App.5th at p. 144.)
We conclude the court's determination was based on substantial evidence, i.e., that Anne's concealment of over $400,000 of community funds impaired James's ability to pay the 2011 taxes. Anne's arguments amount to a request that we reweigh the evidence, which we are prohibited from doing under our abuse of discretion standard of review. (In re Caden C., supra, 11 Cal.5th at p. 640.) We will affirm the court's ruling.
B. Anne's Claim 11 Arguments
Anne argues in her claim 11 that the trial court erred for multiple reasons in ordering her to reimburse James $11,901 for his payment of tax penalties and interest incurred regarding the community's 2012 taxes.
First, she contends there is no substantial evidence that she "secreted" community funds. She fails to support this argument with any meaningful discussion of facts or law, and does not even acknowledge the trial court's findings that she took over $400,000 in community funds without James's knowledge prior to the imposition of the 2012 tax penalties and interest in December 2013 and did not account for the funds she took. Therefore, we will not address this argument further. (Cahill, supra, 194 Cal.App.4th at p. 956; Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684; Chicago Title Ins. Co., supra, 188 Cal.App.4th at p. 415; Mendoza v. City of West Covina, supra, 206 Cal.App.4th at pp. 713-714.)
Second, Anne contends there is no evidence that she "had, until December 2013, '$55,000 from her February 2012 transfer' or the $69,000," and contends that she needed to support the children and herself, make mortgage payments, and comply with the court's pretrial orders regarding her use of funds. This is not a particularly relevant argument (nor one that Anne supported with proof). The court could reasonably infer from the over $400,000 Anne concealed from James that she caused the community to incur and James to pay the 2012 tax penalties and interest. Anne's use of these funds or her financial needs are not relevant to this determination.
Third, Anne argues the trial court erred because James breached his fiduciary duty to her by withholding her post-separation half-share of $311,758 in PESC distributions he received post-separation. Anne fails to show she raised this issue below in opposition the court's order that she reimburse James for his payment of the 2012 tax penalties and interest. She has therefore forfeited it. (See In re S.B., supra, 32 Cal.4th at p. 1293; In re S.C., supra, 138 Cal.App.4th at pp. 406-407.)
C. Anne's Claim 12 Arguments
Anne argues in her claim 12, based on four contentions, that the trial court erred in ordering her to reimburse James $8,666 for his payment of 2013 tax penalties and interest.
First, Anne contends James's late tax payments every year show "that James's failure to pay income taxes timely is his way of doing business, or a failure of budgeting, rather than Anne's fault." This fails to grapple with the substantial evidence that supports the trial court's finding. James testified that if he had funds available, he would have paid the 2013 taxes on time. He also testified that in 2010, the family and his business were financially strapped. The maximum had been borrowed on the home and business credit lines and credit cards, and savings had been depleted to pay expenses. As a result, the parties borrowed money in 2010, 2012, and 2013 from their 401(k) plans, and he would have timely paid back these loans and paid back taxes if he had known there was cash available. Anne's contention amounts to another request that we reweigh the evidence, which we are prohibited from doing under our abuse of discretion standard of review. (In re Caden C., supra, 11 Cal.5th at p. 640.)
Second, Anne again contends she did not have the money to pay the 2013 tax liability and spent any funds available to her for living expenses, mortgage, college expenses, and lawyers. This too is an unpersuasive argument. The court could reasonably infer from the over $400,000 Anne concealed from James that she caused the community to incur and James to pay the 2013 tax penalties and interest, regardless of whether she was able to pay taxes after paying for her other expenses.
Third, Anne contends "[t]here is no evidence that James could not have paid the taxes on post-separation income with post-separation income. This argument is based on speculation rather than evidence and, therefore, we will not consider it further. (Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684; see California Shoppers, Inc. v. Royal Globe Ins. Co. (1985) 175 Cal.App.3d 1, 45 [" '"' "A judgment cannot be based on guesses or conjectures. [Citation.] . . . 'A finding of fact must be an inference drawn from evidence rather than on a mere speculation as to probabilities without evidence.'" '"' "].)
Finally, Anne contends James's purported breach of his fiduciary duty to her, by receiving and keeping $16,110 that he received from PESC in 2013 after the couple had separated, means the trial court erred in ordering her to reimburse him for his payment of the 2013 penalties and interest. Anne fails to show that she raised this issue below in opposition to the court's order that she reimburse James for his payment of the 2013 tax penalties and interest. She has forfeited it. (See In re S.B., supra, 32 Cal.4th at p. 1293; In re S.C., supra, 138 Cal.App.4th at pp. 406-407.)
Anne's Claim 16
The trial court found that in June 2013 Anne funded a bank account for the Trust with $289,186 in cashier checks she took from the family residence, community funds James and Anne obtained from their sale of a share they held in PESC. The court found that this Trust account, with interest added, initially held $289,515.20. It further found that James received $83,500 of this money while this litigation was pending, Anne paid $29,000 of it for litigation expenditures as allowed by court orders, and the Trust account held no funds after an August 8, 2014 court order.
The court also found that it had repeatedly ordered Anne to account for the source and use of these Trust funds and that she did not do so, resulting in the court's imposition of an evidentiary sanction against her. In its FSOD, the court, citing Prentis-Margulis, supra, 198 Cal.App.4th 1252, shifted the burden of proof to Anne to account for all of the funds. The court ruled that she failed to meet her burden. It ordered her to reimburse James $61,257.60 for his half-share of the unaccounted-for Trust funds.
As we have discussed, that case held, "[I]n a trial where community assets are missing, . . . statutory duties of disclosure and accounting serve to shift the burden of proof on missing assets to the managing spouse." (Prentis-Margulis, supra, 198 Cal.App.4th at p. 1271.)
Anne argues the trial court erred in ordering her to reimburse James $61,257.60. Essentially, she contends the court, with James's agreement, previously ordered that she use Trust funds to pay for community obligations such as a daughter's college tuition, that this order became final before trial, and that, therefore, even though James denied at trial agreeing to the use of these funds for the children's college expenses, the court did not have jurisdiction to order her to reimburse James as stated in the FSOD.
Anne does not cite any legal authority for her claim that the trial court had no jurisdiction to order her to reimburse James as it did in the FSOD. We therefore do not address it. (Cahill, supra, 194 Cal.App.4th at p. 956.)
In any event, Anne fails to establish that any of the court's pretrial orders that she identifies were final rulings regarding whether James was entitled to reimbursement for the funds taken by Anne, regardless of whether Anne used those funds in accordance with the court's orders. For example, she focuses on a November 22, 2013 order that she "pay all of the college expenses, including tuition, for the parties' eldest daughter . . . from the funds held in the [Trust]." She contends this order became final pursuant to Code of Civil Procedure section 906, without further explanation. But section 906 merely states that an appellate court may review "the verdict or decision and any intermediate ruling, proceeding, order or decision which involves the merits or necessarily affects the judgment or order appealed from or which substantially affects the rights of a party ...." (Italics added.) In other words, section 906 does nothing to establish that the trial court's pretrial orders were anything other than intermediate rulings that were subordinate to the court's final determinations after trial. Anne fails to meet her burden of persuasion as appellant. (JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237.) Her claim 16 is without merit.
Anne's Claim 17
In her claim 17, Anne argues the trial court erred in valuing the share held by the community in PESC at $187,013, both in awarding that share to James and in ordering that he pay Anne $93,506.50 for her one-half interest in it. The court based these rulings on testimony by James's expert in the valuation of medical practices. Anne argues the court erred by overruling Anne's objection that the expert relied on hearsay documents (one of multiple objections she made) and basing its decision on an expert opinion that was derived from hearsay documents, citing Sanchez, supra, 63 Cal.4th 665.
We "review a trial court's rulings on the admissibility of evidence for abuse of discretion." (In re Marriage of Brubaker &Strum (2021) 73 Cal.App.5th 525, 540, fn. 5.)
Anne's argument is based on a fundamental misunderstanding of Sanchez's holding. Sanchez does not prohibit an expert from relying on hearsay in forming his or her opinion. This court recently summarized the significance of Sanchez and its progeny in Strobel v. Johnson &Johnson (2021) 70 Cal.App.5th 796 (Strobel). As relevant here, we wrote:
" 'In Sanchez,' our Supreme Court 'clarified the "proper application" of our evidentiary law as it relates to the intersection of hearsay and expert testimony.'" (People v. Veamatahau (2020) 9 Cal.5th 16, 25 (Veamatahau).) The Sanchez court begins its analysis by explaining that "[t]he hearsay rule has traditionally not barred an expert's testimony regarding his general knowledge in his field of expertise." (Sanchez, supra, 63 Cal.4th at p. 676.) That starting premise is crucial to a proper understanding of the Sanchez rule governing case-specific hearsay. Sanchez accommodates the pragmatic reality that, by dint of what experts do-they draw upon training in, experience with, and study of knowledge produced by others-this special category of witnesses must of necessity rely on hearsay sources.
" 'Because experts rely on hearsay knowledge and because a jury "must independently evaluate the probative value of an expert's testimony," including by assessing the basis of the expert's opinion, the expert is entitled to tell the jury the basis or" 'matter' upon which his opinion rests."' (Veamatahau, supra, 9 Cal.5th at p. 25.) But rather than let an expert freely place before the fact finder any hearsay 'matter' that may be characterized as a basis of his or her opinion so long as it is not admitted for the truth, the Sanchez court refined the rules governing admission of expert testimony to make clear that such testimony may convey hearsay only if it is (1) general knowledge among those in the expert's field, or (2) independently provable by admissible evidence. (Sanchez, supra, 63 Cal.4th at pp. 676-677.)
Under Evidence Code sections 801, subdivision (b), and 802, Sanchez holds, not only can an expert "rely on hearsay in forming an opinion," but he "may tell the jury in general terms that he did so." (Sanchez, supra, 63 Cal.4th at p. 685.) In so holding, Sanchez jettisons the need for the fact finder to recognize and maintain the elusive distinction between information coming from an expert that may be fully relied upon for the truth of contested facts, versus information that has been admitted for the limited purpose of evaluating the basis of the expert's opinion. (People v. Nieves (2021) 11 Cal.5th 404, 440 ["In Sanchez, we disapproved of the conclusion in prior decisions such as People v. Gardeley (1996) 14 Cal.4th 605, 618, that expert testimony about case-specific hearsay is not admitted for its truth and thus not subject to hearsay rules. (Sanchez, at p. 686, fn. 13.)"].)
"In place of the old, limited admissibility regime under the Gardeley line of cases, Sanchez restores the traditional common law distinction between inadmissible case-specific hearsay and admissible background knowledge. (Veamatahau, supra, 9 Cal.5th at p. 25.) After Sanchez, what was once known as 'basis' testimony coming from experts is now handled as a threshold matter of admissibility, rather than by assigning different probative purposes to already admitted evidence. An expert's testimony to background information is admissible-as it has always been, either as nonhearsay to the extent it rests on the expert's personal knowledge (ibid.), or under a hearsay exception to the extent it rests on information provided by others (id. at pp. 25-26 &fn. 1)-while testimony to case-specific facts is subject to exclusion, unless independently proved by admissible evidence (id. at p. 26)." (Strobel, supra, 70 Cal.App.5th at pp. 817-818; see People v. Bona (2017) 15 Cal.App.5th 511, 520 ["Although Sanchez is a criminal case, it also applies to civil cases . . . to the extent it addresses the admissibility of expert testimony under Evidence Code sections 801 and 802"].)
Thus, Sanchez reaffirmed that an expert may rely on hearsay in forming an opinion, and may testify in general terms that he or she has done so. The trial court was correct in overruling Anne's hearsay objection and relying on expert testimony that was based on hearsay. Her argument to the contrary is without merit.
Anne also suggests that the trial court erred by relying on a valuation of the community's share in PESC as of December 31, 2017, rather than on an exhibit that shows James received a distribution of $20,169.85 in January 2018. Because Anne does not cite any legal authority or reasoned legal argument in support of her position, we do not consider this argument further. (JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237; Cahill, supra, 194 Cal.App.4th at p. 956.)
Anne's Claim 18
In her claim 18, Anne argues the trial court erred (1) in its valuation of the tangible and intangible assets of James's business, TEC, and the valuation of the business itself as of both the date of marriage and the date of separation, because it improperly overruled her hearsay objections to the testimony of James's valuation expert (which she based on Sanchez, supra, 63 Cal.4th 665 and People v. Burroughs (2016) 6 Cal.App.5th 378) and relied on that hearsay testimony in its valuation; and (2) in not allowing Anne to testify as to her opinion of the value of TEC.
Again, we "review a trial court's rulings on the admissibility of evidence for abuse of discretion." (In re Marriage of Brubaker &Strum, supra, 73 Cal.App.5th at p. 540, fn. 5.)
Regarding Anne's first argument, as we discussed in addressing her claim 17 above, and as this court discussed in Strobel, our Supreme Court reaffirmed in Sanchez that under Evidence Code sections 801, subdivision (b), and 802, "not only can an expert 'rely on hearsay in forming an opinion,'" but the expert may tell the factfinder" 'in general terms that he did so.' (Sanchez, supra, 63 Cal.4th at p. 685.)" (Strobel, supra, 70 Cal.App.5th at p. 817.) Anne cites numerous instances where the trial court overruled her objections to James's valuation expert's use of hearsay documents to refresh her recollection, including, Anne contends, in a number of instances when the expert was merely reading from a hearsay document. In none of the instances cited by Anne, however, does she establish that the expert did anything other than indicate she relied on hearsay in forming her expert opinions, testify in general terms that she was doing so, or refer generally and for a non-hearsay purpose to information she relied on, such as to explain her choice of valuation methodologies (see Sanchez, supra, 63 Cal.4th at p. 681 ["If statements related by experts as bases for their opinions are not admitted for their truth, they are not hearsay"]). We therefore conclude Anne's hearsay arguments are without merit.
Anne also argues that, when valuing TEC as of the date of marriage and as of the date of separation, James's expert was inconsistent in her use of accepted methods of valuation, thereby showing that she "was tilting the outcome in James's favor." If true, however, this argument goes to the weight of the expert's testimony, not its admissibility under Sanchez and, therefore, it is not a basis for finding error. Also, we will not second-guess the court's determination of the weight to give this testimony. (In re Caden C., supra, 11 Cal.5th at p. 640.)
Anne further argues that the trial court erred in accepting the expert's opinion of the value of TEC as of the date of marriage because the expert's valuation was actually as of December 31, 1992, about seven months after Anne's May 1992 marriage to James, rather than as of the actual date of marriage itself. Anne does not show that she raised this issue below, fails to cite any legal authority for her contention of error, and makes no effort to show she was prejudiced by the purported error. Thus, she has forfeited the argument, and we need not consider it further. (Honig, supra, 127 Cal.App.4th at p. 530; Estate of Westerman, supra, 68 Cal.2d at p. 279; JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237; Cahill, supra, 194 Cal.App.4th at p. 956.)
The same is true for Anne's second contention that the trial court erred by failing to allow her to opine on the value of TEC in her testimony. Once again, she fails to cite any legal authority or make any reasoned legal argument in support of her contention. This argument, too, has been forfeited. (JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237; Cahill, supra, 194 Cal.App.4th at p. 956.)
Anne's Claim 21
In its FSOD, the trial court ordered Anne to reimburse James $19,955.58 for one-half of the fees he advanced to nine experts whom the court ruled were either court-appointed or jointly retained, including $4,785 to residential real estate appraiser Brian Grey and $10,000 to Dr. John Bradshaw. The court determined that all the expert fees James advanced were reasonable "based on the lack of any claim to the contrary by [Anne] in any trial evidence submitted."
In her claim 21, Anne argues the trial court erred in ordering her to reimburse James one-half of his advances to Grey and Bradshaw. She contends, first, that, because she "was proceeding in forma pauperis," the trial court's denial of her requests for attorney fees and costs and for money for her own experts created "a very uneven playing field" at trial in contravention of Family Code section 2030 (which authorizes the court to order one party to pay the other party's attorney fees and costs to ensure access to legal representation), and that the court's order that she pay half of James's advances to experts Grey and Bradshaw was "unjust and punitive."
We disagree with this contention. As we have already discussed in considering Anne's claim 30 above, Anne has forfeited any claim that the trial court's denial of her October 2018 request for expert fees and attorney fees and costs was in error, and we have rejected her other requests for such fees and costs in previous opinions. She also fails to show the court's order that she reimburse James for expert fees he advanced was unjust or punitive, particularly in light of the fact that the court in its FSOD awarded her substantial financial assets.
Second, Anne contends that the court erred because "[a]ll the experts testifying at the trial were James's." We disagree with this contention as well, as we now discuss regarding each expert.
A. Brian Grey
Regarding Brian Grey, Anne first contends that, while he was originally retained as a joint neutral to prepare a 2015 appraisal of the family residence, he later prepared an update to that appraisal as an expert for James only. James contends that Anne has waived this claim and, further, that it lacks merit.
Grey testified that he was hired on July 31, 2015, by the lawyers for Anne and James as a joint neutral appraiser, and that he conducted his appraisal of the family residence shortly after his August 2015 inspection of it. He further testified that he updated this appraisal in 2018 at the request of James's lawyer. Prior to conducting that updated appraisal, he wrote an email to Anne's attorney asking to conduct a walk-through of the family residence, but did not receive a reply until after he received a court order for that appraisal.
According to Anne, Grey's joint retention was only to conduct the 2015 appraisal. We disagree. The only evidence contained in the record is that Grey was retained and conducted his appraisals as a joint neutral. Anne cites no evidence that his status changed before trial; the record shows only that her attorney ignored his request to conduct the 2018 update. Grey's initial appraisal was in 2015, approximately three years before trial. Anne fails to show that Grey acted improperly in updating that appraisal prior to trial, or that the trial court acted improperly in ordering the parties to compensate him for that work.
Although not evidence, James's attorney told the court during trial that she sought the cooperation of Anne's attorney in having Grey update his appraisal but received no reply, and ultimately had to file a motion to compel access to the family residence so that the update could be done.
Anne also alludes to "substantial evidence" that James's advance to Grey was paid with community funds from x7180. She fails to support this assertion with any evidence either. Therefore, we will disregard it. (Meridian Financial Services, Inc., 67 Cal.App.5th at p. 684.)
In short, Anne's contention that the court erred in ordering her to reimburse James for certain fees paid to Brian Grey is without merit.
B. Dr. John Bradshaw
Regarding Dr. John Bradshaw, Anne first contends the evidence does not show he was retained jointly by Anne and James, was appointed by the court, or charged $10,000 for services he provided while acting in either capacity.
Anne's contentions are contradicted by the evidence. James's attorney testified that the trial court, on its own motion, ordered a private child custody evaluation to be conducted by another evaluator or, if that evaluator was not available, by Bradshaw. The attorney subsequently sent Bradshaw an email indicating his appointment, with a copy going to Anne's attorney. Anne's attorney subsequently moved ex parte to terminate Bradshaw's appointment, arguing he was unsuitable, which motion the court denied. Further, James testified that he paid Bradshaw $10,000. Based on this evidence, we conclude Anne's claim that the court erred in ordering her to reimburse James one-half of this $10,000 payment lacks merit.
Prior to trial in December 2017, the trial court indicated that Bradshaw had written to the court that he had begun evaluating James, but had been unable to evaluate Anne for lack of cooperation. He recommended the court appoint another evaluator. After hearing argument, including Anne's attorney's contention that Bradshaw had showed he did not "really understand the rules that he is supposed to abide by," the court terminated Bradshaw's appointment.
Anne's Claim 23
In its FSOD, the trial court ordered James to pay guideline child support to Anne for one minor child in the amount of $3,217 a month. It based this figure on James's testimony at a December 2017 hearing regarding his request that the court terminate temporary spousal support or impute income to Anne.
The court rejected James's request in its FSOD.
In just two pages, Anne contends the trial court erred in its guideline child support ruling because (1) James's testimony about his income consisted of "guesses" and "approximations" that were not substantial evidence and, further, the court disregarded the most current evidence, which showed James made greater amounts from certain sources of income than what the court determined; (2) in the absence of substantial evidence of income, the trial court's ruling on guideline child support was in excess of its jurisdiction; (3) the court should have reserved jurisdiction over the guideline child support issue rather than decide it using guesses; and (4) the trial court's ruling that James was not required to pay child support on income higher than the base amount until April 15 of the following year violated Family Code section 4053, subdivision (1)'s mandate that "children actually receive fair, timely, and sufficient support ...."
Anne's summary contentions in categories 2, 3, and 4 above, as well as her contention in category 1 above that the court was obligated to rely on the most current evidence of James's income in determining guideline child support, are not supported by any relevant legal authority or meaningful legal discussion. For these reasons, she has forfeited them and we will not consider them further. (JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237; Cahill, supra, 194 Cal.App.4th at p. 956.)
As for what remains of Anne's challenge in category 1 above, James argues Anne has forfeited this appellate claim by her failure to object below to the admission of any purported guesses by him. But Anne does not challenge the admission of James's testimony; she simply contends his testimony is insufficient to support the court's ruling. Insufficient evidence arguments are excepted from the rule that points not raised first in the trial court are forfeited. (People v. Butler, supra, 31 Cal.4th at p. 1126, quoting Tahoe National Bank v. Phillips, supra, 4 Cal.3d at p. 23, fn. 17.) Turning to the merits of the claim, then, we reject Anne's argument that the trial court improperly relied on guesses and ignored certain evidence of James's income. To explain that conclusion, we first review the proceedings below and the legal standards that apply here.
When asked on cross-examination at the December 2017 hearing about his 2017 income from sources other than his business, TEC, James testified, "Well, off the top of my head, I don't have those numbers, because I wasn't prepared to present them. [¶] . . . [PESC] is probably about $60,000. The Nu Skin is probably $24,000, and Rhein Medical is $600." Asked his 2017 income from TEC, he said he did not know "because the accountant hasn't put together all the depreciation and other things accountants do"; asked about his "profit or income without depreciation" from TEC, he replied, "Approximately $300,000. But, I mean, that's off the top of my head, type of guess." Anne's counsel asked, "So it's a guess?" James responded, "Yeah, as have been all of these numbers."
Later in the same cross-examination, James, asked his monthly income from PESC, replied, "About $8,000 a month." But he immediately corrected himself, saying, "I'm sorry, no; that's wrong. About $5,000 a month." He further stated that his income from royalties and vitamin sales was $2,050, apparently referring to monthly income.
At trial, James testified on direct examination that in an average month, he received $5,420 in dividends and interest from the community's investment in PESC, half of which was his; $100 a month from Rhein Medical; and $1,800 a month from Nu Skin. He further testified that his "prior income" from his business, TEC, had been about $27,000 a month, but that it had "dropped"; asked about his income from the previous month, he replied, "I want to say about $12,000, but I'd have to look at the calculation."
Also, a summary of cash distributions James received from PESC from January 1, 2013 through March 31, 2018, totaling $262,762, contained in James's Exhibit U, was admitted into evidence. This summary lists the most recent quarterly payment James received from PESC, in January 2018, as $20,169.85.
In its FSOD, the court found: "[James] testified that he makes approximately $300,000 in annual profit from his medical practice. In addition, the Court's property division awards him a share of a surgery center that yields annual profits of $60,000. [James] received income from NuSkin for his sale of neutraceuticals in the amount of $24,000 annually, and he receives royalty payments of $100 per month from Rhein Medical. Those combined sources of income result in a gross monthly income of $32,100, entered as $25,000/month in self-employment income and $7,100/month in other taxable income." The court then calculated the guideline child support James should pay.
Family Code section 4055 sets forth the "statewide uniform guideline" for determining child support. Under the guideline, child support obligations are divided "among the parents based on income and amount of time spent with the child by each parent ...." (Fam. Code, § 4052.5, subd. (a).) "The guideline takes into account each parent's actual income and level of responsibility for the children." (Fam. Code, § 4053, subd. (c).) The amount of child support established by the uniform guideline formula is presumed to be the correct amount of child support to be ordered. (Fam. Code, § 4057, subd. (a).) "Determining the amount of child support therefore is a highly regulated area of the law, and the only discretion the trial court has is the discretion conferred by statute or rule." (In re Marriage of McHugh (2014) 231 Cal.App.4th 1238, 1245, fn. omitted.)
"An award of child support rests in the court's sound discretion and cannot be overturned absent a showing of a clear abuse of discretion. 'An appellate court does not substitute its own judgment; rather it interferes only if no judge could reasonably have made the order under the circumstances.'" (In re Marriage of Hubner (2001) 94 Cal.App.4th 175, 184.) We" 'examine the evidence in the light most favorable to the prevailing party and give that party the benefit of every reasonable inference. [Citation.] We accept all evidence favorable to the prevailing party as true and discard contrary evidence. [Citation.]' [Citation.] 'We do not reweigh the evidence or reconsider credibility determinations.'" (In re Marriage of Calcaterra &Badakhsh (2005) 132 Cal.App.4th 28, 34.) "We are not called upon to determine whether we would have made such an award, but whether any judge could reasonably have done so." (In re Marriage of de Guigne (2002) 97 Cal.App.4th 1353, 1366.) The lower court's order is presumed to be correct on appeal (In re Marriage of Oliverez (2019) 33 Cal.App.5th 298, 311-312), and the appellant bears the burden of affirmatively demonstrating prejudicial error. (County of San Diego v. P.B. (2020) 55 Cal.App.5th 1058, 1068.)
Applying these legal standards here, we conclude Anne has not met her burden of showing there is a lack of substantial evidence supporting the trial court's findings of James's income in its calculation of guideline child support. It is axiomatic, of course, that pure speculation is not substantial evidence upon which a court can rely. (E.g., California Shoppers, Inc. v. Royal Globe Ins. Co., supra, 175 Cal.App.3d at p. 45.) In his testimony about the amount of money he received from his different sources of income, James characterized these amounts as "guesses," but the court could reasonably conclude from his testimony and its context that James did not mean he was literally guessing. In describing these amounts, he used terms such as "probably about $60,000," "probably $24,000" and "[a]pproximately $300,000." (Italics added.) The court could reasonably conclude from this testimony that James's references to "guesses" merely indicated he was stating approximations based on his personal knowledge, but that he did not know the exact figures "off the top of [his] head," as he put it.
Anne challenges this evidence by, first, pointing to other evidence in the record regarding James's income, but we must ignore evidence that is contrary to the substantial evidence relied on by the court below. (In re Marriage of Calcaterra &Badakhsh, supra, 132 Cal.App.4th at p. 34.) The remainder of Anne's argument appears to be an effort to cast her attack on the court's guideline payments determination as a purely legal issue that we can decide de novo. She argues the court could not as a matter of law rely on approximations (even if based on personal knowledge). but she cites no case or statute for this contention. She has forfeited this argument for failure to develop it. (JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237; Cahill, supra, 194 Cal.App.4th at p. 956.)
In sum, we conclude Anne's claim 23 is meritless.
Anne's Claim 24
The trial court found James made $34,237 in post-separation payments for the community's credit card debt, based on James's Exhibit T. It ordered Anne to reimburse James $17,118.50 for her one-half share of this community debt. Anne contends the court erred because (1) there was no evidence that the debt belonged to the community, that James's payments were exclusively for community debt, that James used separate property funds to pay the debt, or regarding what the debt was as of the date of separation; (2) there was no basis in law or fact to charge Anne interest; (3) James lived in the family residence until May 2013, during which time he had the statutory duty to support Anne with common necessaries of life without the right of reimbursement; and (4) James had community funds with which to pay off the debt in April 2014 and breached his fiduciary duty by not paying it.
James asserts Anne has forfeited all of these contentions by failing to first raise them below. We agree that Anne has forfeited all of these contentions except those in category 1. Contentions 2 through 5 involve assertions of fact or law that she did not raise in the trial court below. Having failed to preserve objections on the grounds asserted in these contentions, she has forfeited them. (Honig, supra, 127 Cal.App.4th at p. 530; Estate of Westerman, supra, 68 Cal.2d at p. 279.)
In her category 1 contentions, however, Anne argues there is insufficient evidence to support the trial court's ruling in several respects. As noted above, such a claim cannot be forfeited by the failure to first raise it below. (People v. Butler, supra, 31 Cal.4th at p. 1126, quoting Tahoe National Bank v. Phillips, supra, 4 Cal.3d at p. 23, fn. 17.) Turning, then, to the merits of these contentions, we must affirm a trial court's ruling if it is supported by any substantial evidence, whether or not relied on by the trial court. (See People v. Dickens (2005) 130 Cal.App.4th 1245, 1254 ["Because we are obligated to review the record independently to determine whether the ruling is supported by substantial evidence [citation], the court's statement of its reasons . . . is not dispositive"].)
Here, the court relied exclusively on Exhibit T, but that exhibit indicates only that James paid $34,237.41. This alone is not sufficient to support the trial court's ruling, which rests on the conclusion that James post-separation used his separate property funds to pay for a community debt of that amount. That conclusion, however, is supported by other substantial evidence.
Specifically, James testified that he made payments of $34,237.41 for a community debt as set forth in Exhibit W (which was admitted into evidence and lists 15 payments for the credit card debt between October 2013 and January 2015). James indicated in his testimony that these payments were "for a bill that existed as of the date of separation." This is substantial evidence that the debt was incurred during the marriage, making it the community's debt, that the $34,237.41 of debt existed as of the date of separation, and that James's payments of this debt were for a community obligation. Further, James testified that he made these payments from "husband's separate property bank account, Wells Fargo Bank 7180," from which it can be reasonably inferred that he used separate property funds to pay this community debt. (In re Marriage of Kamgar, supra, 18 Cal.App.5th at p. 144 [under a substantial evidence standard of review, we draw all reasonable inferences in favor of the decision].) Therefore, Anne's insufficient evidence contentions lack merit.
Anne's Claim 25
The trial court found that James transferred $1,500 of his funds to Anne's separate Wells Fargo account on July 25, 2013, after the parties had separated. It ordered Anne to reimburse James for this $1,500, which it characterized as "post-separation separate property funds of [James]" without further explanation.
Anne argues this was in error because James had no right of reimbursement for his voluntary, post-separation deposit of his separate property funds into her separate bank account. James responds that, "[u]nder Anne's narrow reimbursement theory of law, Anne might be correct." But he goes on to argue there was no error because, in order to change the character of the funds, a transmutation would have been necessary, which must be effected by express declaration under Family Code section 852, and it was not done here.
Family Code section 852, subdivision (a) states, "A transmutation of real or personal property is not valid unless made in writing by an express declaration that is made, joined in, consented to, or accepted by the spouse whose interest in the property is adversely affected." Family Code section 850, subdivision (c) provides that, subject to Family Code sections 851 to 853, "married persons may by agreement or transfer, with or without consideration," "[t]ransmute separate property of one spouse to separate property of the other spouse."
In principle, James may be correct, but we nonetheless reject his argument. Neither the court nor the parties cite to anything in the record identifying the reason for James's deposit of his $1,500 into Anne's separate bank account. In the absence of any such evidence, we conclude the only reasonable conclusion is that James voluntarily gave this separate property to Anne, and see no reason why Anne should be required to reimburse him for it. Whether there was a transmutation is irrelevant. Accordingly, we will reverse this part of the court's FSOD.
Anne's Claim 26
The trial court found that in 2018 the parties received a property tax escrow refund check for $1,314 from Wells Fargo Bank; that Anne, not James, received this check; and that James post-separation made the property tax escrow payments to the parties' mortgage lender with separate property funds. Based on these findings, it ordered Anne to reimburse James the entire $1,314.
Anne argues the trial court erred because, while there is evidence that the check was issued to the parties, there is no evidence that she cashed it or withdrew the funds. Her argument is unpersuasive. Anne does not challenge the trial court's finding that she received the check, which the court based on James's testimony that he did not receive it or any proceeds from it. She cites James's testimony that he told her he was happy to sign what he characterized as a "two-party check", but she does not assert his signature was required for her to cash it, and she cites other evidence in the record that she contends support her position. None of this matters, as we do not reweigh the evidence under our substantial evidence standard of review. (In re Caden C., supra, 11 Cal.5th at p. 640.) We conclude it was reasonable for the court to infer from James's testimony that Anne both had possession of the check and access to the funds, and to charge her for it.
Anne's Claim 27
The trial court found that James paid $147,658.04 post-separation into a property tax escrow account maintained with the parties' mortgage lender. It ordered Anne to reimburse James her one-half share of this property tax, $73,829.02.
Anne makes three arguments for reversal of this FSOD ruling. First, she argues the trial court erred in ordering her to reimburse James for half of the $147,658.04 because James's Exhibit Y shows that both of them paid money into the tax escrow account between June 2013 and September 2018. Exhibit Y does not support her contention. The exhibit consists of a chart of payments by James and Anne for "property tax, mortgage, insurance" between January 1, 2013 and September 1, 2018. It shows $147,658.04 in property tax escrow payments and $402,174.92 in mortgage principal and interest payments, for a total of $549,832.96 in payments. The chart further indicates that of these total payments, James paid $475,711.26 and Anne paid $74,121.70, without indicating for what Anne's payments were made. In other words, Anne fails to cite evidence that she made some portion of the property tax escrow payments the court attributed to James, since all of her payments could have been for mortgage principal and interest.
Second, Anne contends James's Exhibit T shows that he made his escrow payments from Wells Fargo bank account x7180, into which he deposited community funds from PESC distributions, proceeds from the sale of a PESC share, and withdrawals from HELOC x5148 between January 2013 and late March 2018. Anne argues this evidence contradicts the court's finding that James made payments from his own separate property.
Exhibit T consists of over 400 pages of transactions and other information, including regarding the Wells Fargo bank account x7180 that was in James's name. Anne cites to one page of Exhibit T that indicates James deposited $56,100 into the Wells Fargo account from HELOC x5148 during the period from 2013 to 2018. But because she fails to show this deposit was used by James to make any property tax escrow payments, it is not evidence of error. Beyond that, Anne does not indicate where in these over 400 pages there is evidence that supports her contentions, and we have no obligation to search through this voluminous material to find such evidence. Because she fails to provide supporting record citations, she has waived this argument. (Meridian Financial Services, Inc., supra, 67 Cal.App.5th at p. 684.)
To be sure, Anne also cites a portion of James's testimony in which he was asked, "Can you tell the Court what was the total amount of community deposits into the Wells Fargo Account 7180?" After the court ruled in response to an objection by Anne's counsel that he could look at Exhibit T in order to refresh his recollection, James answered, "2 million 360-some thousand." The portion of Exhibit T that he appears to have looked at lists deposits of community and separate property funds into the Wells Fargo account totaling the amount James testified to, but lists only $300,815.27 in community fund deposits. Anne's citation to James's testimony is in effect another request that we reweigh the evidence, which we shall not do under our substantial evidence standard of review. (In re Caden C., supra, 11 Cal.5th at p. 640.) Anne's argument is also unpersuasive because she fails to meet her burden as appellant of showing why, under the circumstances, the trial court could not rely on James's characterization in Exhibit T of the funds rather than on his testimony, or why Exhibit T does not constitute substantial evidence that supports the trial court's findings. (See JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237.)
Third, Anne contends that, whatever amount James paid from his separate property into the property tax escrow account, it would not be evidence that the mortgage lender actually paid that amount out in property taxes because "the escrow account often contains money that has not yet been paid out." She further contends the evidence shows that most recently, in October 2018, there was $18,239.14 in the tax escrow account and argues the court should have treated these funds an asset to be divided, not a debt for which James deserved reimbursement.
It was reasonable for the trial court to infer that the mortgage lender paid property taxes as they became due from the escrow payments made by James in light of the evidence that the funds in the property tax escrow account were depleted, and to also infer that the mortgage lender would soon pay the remaining amount, $18,239.14, as property taxes again became due. Since Anne addresses none of these issues, she again has not met her burden of persuasion on appeal. (JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237.) Further, as James points out, Anne does not establish that she ever raised in the trial court that the remaining amount in the escrow account should be considered an asset. Thus, we additionally conclude she has forfeited that argument. (Honig, supra, 127 Cal.App.4th at p. 530; Estate of Westerman, supra, 68 Cal.2d at p. 279.)
Anne's Claim 29
Next, Anne argues the trial court erred in its FSOD by granting James's motion for judgment under Code of Civil Procedure section 631.8 regarding numerous issues for which, the court concluded, Anne failed to introduce evidence at trial sufficient to support her claims. Anne fails to establish a basis for reversal of the court's ruling.
Code of Civil Procedure section 631.8, subdivision (a) states in relevant part: After a party has completed his presentation of evidence in a trial by the court, the other party . . . may move for a judgment. The court as trier of the facts shall weigh the evidence and may render a judgment in favor of the moving party . . . or may decline to render any judgment until the close of all the evidence. The court may consider all evidence received, provided, however, that the party against whom the motion for judgment has been made shall have had an opportunity to present additional evidence to rebut evidence received during the presentation of evidence deemed by the presenting party to have been adverse to him, and to rehabilitate the testimony of a witness whose credibility has been attacked by the moving party."
James initially moved for judgment under section 631.8 after Anne's presentation of evidence. After hearing argument, the court ruled that it was "not yet prepared to render judgment on the issues . . . and the Court is going to deny the motion under 631.8 ...."
Although not mentioned by the parties, in his closing arguments brief, James renewed his motion for judgment under section 631.8 regarding numerous claims by Anne. He argued the court should grant the renewed motion because Anne "offered NO evidence whatsoever regarding the vast majority of [her]claims in her trial brief."
In its TSOD, the court granted this renewed motion. The court ruled, "For every issue identified by [Anne] in her opening brief not specifically addressed below in the body of the Court's [TSOD], the Court finds that [Anne] failed to introduce evidence at trial sufficient to support her claims." Anne did not object to James's renewed motion or this proposed ruling in her objections to the TSOD. The court made this same ruling in its FSOD.
Failing to acknowledge that James renewed his motion in his closing arguments brief, Anne instead characterizes the trial court's FSOD ruling as granting James's initial motion after first denying it, and argues the trial court lacked the jurisdiction to do so. She further contends the court, even if it had jurisdiction to reconsider its denial of the initial motion, could not grant the motion without giving Anne "the opportunity to present additional evidence to rebut evidence received during the presentation of evidence deemed by Anne to have been adverse to her, and to rehabilitate the testimony of a witness whose credibility has been attacked by James."
James opposes Anne's claim 29 on multiple grounds. First, he argues Anne has waived her contention that the court lacks jurisdiction by her failure to cite any legal authority or present any reasoned argument in support of it. We agree that Anne has waived this contention for the reasons James asserts and we will not consider it further. (Cahill, supra, 194 Cal.App.4th at p. 956.)
Among other things, James also argues that we should reject Anne's claim 29 because, even assuming the trial court erred in not allowing her to present evidence before granting James's motion, she has failed to show that she was in any way prejudiced by the error. "[A]ny error involving section 631.8 must result in a miscarriage of justice before a reversal will be ordered." (National Farm Workers Service Center, Inc. v. M. Caratan, Inc. (1983) 146 Cal.App.3d 796, 807, citing Charles C. Chapman Building Co. v. California Mart (1969) 2 Cal.App.3d 846, 858-859.) We agree. Anne does not make any meaningful effort to show prejudice. We reject her claim 29 for this reason as well.
James'S Cross-Appeal
James's Claims I and II
In his cross-appeal, James first argues that the trial court, in its FSOD, exceeded its jurisdiction and ruled without an evidentiary basis in modifying its previous temporary support order and determining his pendente lite spousal and child support obligations, an issue that was left unresolved for several years prior to trial.
In its FSOD, the trial court, concluding that it had reserved the jurisdiction to do so, struck its previous temporary support order, first issued in 2013, that James pay a portion of any income he earned in excess of $23,000 a month under Marriage of Ostler &Smith (1990) 223 Cal.App.3d 33 (Smith/Ostler) on the grounds that it was unable to reconstruct the appropriate DissoMaster table to apply or otherwise calculate the amount James owed. Instead, the court denied James's requests for credit for his post-separation mortgage payments under In re Marriage of Epstein (1979) 24 Cal.3d 76, superseded by statute on other grounds as stated in In re Marriage of Perkal (1988) 203 Cal.App.3d 1198, 1201, statutory interest on his mortgage payments, credit as against his support obligations for postseparation mortgage and casualty insurance payments of $80,996 that he made on Anne's behalf, and reimbursement to the community for Anne's one-half share of the fair market rental value of the family residence under In re Marriage of Watts (1985) 171 Cal.App.3d 366. We conclude the trial court did not err. Contrary to James's contentions, the court retained jurisdiction to make these modifications to its temporary support order and acted within its discretion in issuing its FSOD orders.
A. The Relevant Proceedings Below
On August 9, 2013, after the parties had separated, Anne filed a request for orders regarding numerous matters, including temporary child and spousal support. At an August 21, 2013 hearing, the trial court in relevant part ordered James to pay the September 2013 mortgage for the family residence and continued the hearing to September 25, 2013 to further consider support. At the September 25 hearing, the court ordered that James pay $10,000 a month in temporary family support and continue to pay the monthly mortgage on the family residence. The court continued the hearing to November 22, 2013.
At the November 22 hearing, the parties stipulated, and the court ordered, that James pay $5,022 a month in child support and $4,496 a month in spousal support. Counsel indicated that they had "a Smith Ostler quarterly on any income earned over the base amount in the Disso Master . . .," that Anne would make monthly mortgage and insurance payments to James, and that the parties did not agree "about the allocation in August and September of whether or not the 10,000 is retroactive back to essentially August 9th." The court indicated it was "reserv[ing] jurisdiction of the support retroactivity to August 9th, 2013" and "on the amounts payable with regard to anything that has not been accounted for earlier on the record ...." It continued the hearing until December 11, 2013, to determine "arrears." Anne's counsel agreed to prepare a final order.
The continued hearing did not take place. The case docket contained in the record includes an entry, dated November 22, 2013, which states, "Court sets a hearing date for January 8, 2014 and hearing date of 12/11/13 is off calendar." Two entries dated January 8, 2014, state, "Hearing off calendar. Reason: per stipulation," and that a short cause court trial is "Canceled" and "Off Calendar."
Almost a year-and-a-half later, on May 11, 2015, the court filed a final order regarding the rulings it had made at the November 22, 2013 hearing, which order was drafted by Anne's counsel. This May 11, 2015 order requires that James pay base child and spousal support in amounts stated in the order, and also refers to an attached "Smith/Ostler" "Disso[M]aster Bonus Table," to be used to calculate his quarterly payments to Anne for child and spousal support on any income greater than $23,000 per month. However, no such table was attached to the order. The order also requires Anne to pay James $2,937.35 every month for her one-half of the post-separation mortgage and insurance payments for the family residence.
The May 11, 2015 order further states, "The court shall retain jurisdiction as to the child and spousal support retroactivity to August 9, 2013, as well as any credits claimed by either party related to the support issue. The court retains jurisdiction as to any amendments to the parties' agreement, as well as to the amounts payable, and as to any issue that has not been previously agreed to." It further indicates that the court would hold a hearing on December 11, 2013 "to determine support arrears."
James testified at trial that he did not make any Smith/Ostler payments in the absence of a DissoMaster bonus table attached to the May 11, 2015 order. He said he had no way to calculate what he might have owed for months when his income exceeded $23,000.
Prior to trial, in November 2017, Anne, through her attorney, filed a request that the court amend its May 11, 2015 order nunc pro tunc to include a DissoMaster bonus table. At a December 22, 2017 hearing, the court granted Anne's request, finding the omission of the DissoMaster bonus table from its May 11, 2015 order was a clerical error subject to correction. But the court was unable to generate a DissoMaster bonus table for 2013 (when it first ordered use of the DissoMaster bonus table) due to a change in the court's DissoMaster program. It reserved jurisdiction over correction of the May 11, 2015 order and ordered the parties to try to re-create a 2013 DissoMaster bonus table. Also, the court stated at the December 22, 2017 hearing that it would resolve this temporary support arrears issue after trial. Specifically, James's counsel asked if the court would be making any orders regarding James's claims that offsets should be applied to his support obligations. The court replied that it was "going to reserve jurisdiction over any payment of spousal support on the . . . order from May 11th, 2015, and the adequacy of payment on Smith-Ostler, to the trial that we're having on the issues of spousal support and property division because . . . at this point, given that there are various contentions between the parties about underpayments and overpayments, it does seem that the historical underpayment should be resolved at the time that we're resolving the remainder of the issues." The court's minute order from the hearing states that it "reserved jurisdiction" as to "[a]ny retro payment from 5.11.2015 order."
At a December 27, 2017 hearing, the court indicated it was setting the case for trial to address a variety of issues, including "[a]ll remaining contested issues in the trial." The court repeated this in July 2018, at a hearing just prior to trial, when it told the parties that "[t]his case was set for trial on all disputed issues." Also at this hearing, the court discussed the disputed temporary support arrears issue. James's counsel requested that the court consider the testimony of James's expert forensic accountant, to be presented at trial, in determining what James might owe Anne in bonus support. The court stated, "To the extent that the non-payment of bonus support and the appropriate amount of what bonus support should have been is an issue-an evidentiary issue before the trial, the Court will not make a determination as to what the actual amounts of arrearages are until the close of evidence in the trial and having heard the evidence." There was no objection by the parties.
Also, in August 2017, James filed a request for an order to terminate spousal support or impute income to Anne based on her alleged failure since August 2013 to make reasonable efforts to find employment as ordered by the court. He argued the trial court "specifically retained jurisdiction to modify all spousal and child support retroactively to August 9, 2013," as indicated in the May 11, 2015 order. The court held evidentiary hearings on his request, but neither completed receiving evidence on the issue nor ruled on the request before trial. In his trial brief, James repeated that the court's original support order was "subject to retroactive adjustment." In its FSOD, the court denied his request based on the evidence presented.
At trial, James attempted to address what support he owed Anne for income over $23,000 a month via the expert testimony of a forensic accountant. The expert concluded, based on certain DissoMaster inputs, information from documents such as James's and Anne's tax returns, and consideration of such matters as James's Epstein claim, that James owed Anne a total of $56,057 in Smith/Ostler payments. However, the court struck all of this expert testimony upon sustaining Anne's objection to the expert's reliance on the tax returns, on the ground that James had failed to list the returns as trial exhibits.
As we have indicated, in its FSOD, the court, based on its reservation of jurisdiction over the temporary support arrears issue, struck its previous order that James pay a portion of any income he earned in excess of $23,000 a month under Smith/Ostler because it could not determine the appropriate DissoMaster table to apply and, given the lack of evidence presented at trial, could not calculate the amount James owed. Instead, the court denied James's claims for credit for his post-separation mortgage payments under Epstein, statutory interest on his mortgage payments, credit as against his support obligations for post-separation mortgage and casualty insurance payments of $80,996 that he made on Anne's behalf, and reimbursement to the community for Anne's one-half-share of the fair market rental value of the family residence under Watts.
The court issued these rulings in the face of James's multiple objections to them after the court included them in its TSOD. Among other things, James contended the court could not make retroactive adjustments to its temporary child and spousal support order because it failed to reserve jurisdiction over the matter after 2013, having taken it off calendar in December 2013 without any indication that it was continuing the matter.
The trial court addressed James's objections in its FSOD. It reviewed the tangled procedural history of the temporary support arrears issue, finding that it had set family support based on Anne's August 9, 2013 filing, had ordered Smith/Ostler support in its May 11, 2015 order, and had, in that order, "specifically reserved jurisdiction to modify the calculated support amounts and any credits thereon to August 9, 2013-the date of filing of the Request for Order." Further, it noted that in 2013, it "set future hearing on the spousal support determination .... The parties continued the subsequent hearing by stipulation, and ultimately did not ask for it to be reset for separate hearing prior to trial. The Court's trial setting order indicated that trial would be heard on 'all disputed issues', including retroactive determination of support amounts paid and due." The court concluded it had "reserved retroactive jurisdiction over appropriate calculation of temporary spousal support to . . . August 9, 2013.... Both parties' conduct at trial deprived the Court of the evidence necessary to actually determine their competing claims for retroactive support calculation. In view of those circumstances, the Court exercises its reserved retroactive jurisdiction ...." The court further concluded that "retroactive modification is permissible pursuant to Family Code [section] 3653[, subdivision] (a)."
B. The Court Retained Jurisdiction Over Temporary Support Arrearages
James first argues the trial court's FSOD order was an improper retroactive modification of a prior order for temporary support for which no motion was pending, citing In re Marriage of Gruen (2011) 191 Cal.App.4th 627 (Gruen). He does not dispute the procedural history of this case, but instead raises what he characterizes as a legal issue regarding jurisdiction. We conduct a de novo review of his argument based on the record before us. (Gruen, supra, 191 Cal.App.4th at p. 637.)
In its FSOD, the trial court concluded it had the authority to revise its May 11, 2015 order under Family Code section 3653, subdivision (a). Section 3653, subdivision (a) provides in relevant part: "An order modifying or terminating a support order may be made retroactive to the date of the filing of the notice of motion or order to show cause to modify or terminate, or to any subsequent date, except as provided . . . by federal law (42 U.S.C. 666(a)(9).)" Section 666(a)(9) of title 42 of the United States Code authorizes the states to allow retroactive modification of a support award over any period "during which there is pending a petition for modification, but only from the date that notice of such petition has been given ...." In other words, "[s]ection 666(a)(9) . . . applies to the modification of an existing child support order and limits the accrual of arrearages to the date the noticed motion or order to show cause is served. Thus, the 'practical impact of subjecting retroactivity to [federal law] is that orders modifying child support (as opposed to original orders of support) may be made retroactive only to the date of service of the [order to show cause] or notice of motion for modification.'" (County of Santa Clara v. Perry (1998) 18 Cal.4th 435, 441.)
James argues the trial court had no authority to retroactively modify its prior support under Family Code section 3653, subdivision (a) because of that statute's incorporation of section 666(a)(9). From James's point of view, the trial court improperly modified its May 11, 2015 order, issued after hearing on November 22, 2013, because (1) the court's jurisdiction over the temporary support arrears issue ended when it took the continued hearing on Anne's August 9, 2013 request for support "off calendar" in December 2013 in the absence of any indication in the record that the parties had stipulated to a continuance, regardless of the court's recollection to the contrary, and (2) there was no pending motion or request for temporary support before the court when it issued its FSOD.
James's argument is premised on the notion that the trial court's having taken the continued hearing on the temporary support arrears issue "off calendar" in December 2013 without ordering a continuance ended the court's jurisdiction over the matter. But that premise is incorrect. The court made clear at the November 22, 2013 hearing and in its May 11, 2015 order that it was retaining jurisdiction over the temporary support arrears issue, retroactive to August 9, 2013, the date when Anne filed her still-pending motion. The court did take the scheduled December 13, 2013 hearing off calendar, apparently based on a stipulation between the parties that is not further explained in the record. But "[a]n off-calendar order is not equivalent to a dismissal and does not divest the court of the jurisdiction which it has acquired." (Guardianship of Walters (1951) 37 Cal.2d 239, 244.) A court may restore the calendar and further consider the matter if "notice is given of the time and place of hearing." (Ibid.) In other words, because a trial court "has discretion in the control and regulation of its calendar or docket," it is "permissible for good cause to delay a trial or hearing to a later date or to drop or strike a case from the calendar, to be restored on motion of one or more of the litigants or on the court's own motion. 'Off Calendar' is not synonymous with 'dismissal.' 'Off' merely means a postponement whereas a 'dismissal' in judicial procedure has reference to a cessation of consideration." (Guardianship of Lyle (1946) 77 Cal.App.2d 153, 155-156, quoted favorably in People v. The North River Ins. Co. (2011) 200 Cal.App.4th 712, 719, fn. 3, and R.A. Vending Services, Inc. v. City of Los Angeles (1985) 172 Cal.App.3d 1188, 1193-1194.)
Based on this case law, we conclude the trial court, having asserted continuing jurisdiction over the temporary support arrearages issue, did not divest itself of that jurisdiction by taking the hearing off calendar in 2013. Further, the court, apparently on its own motion, gave ample and repeated notice to the parties that it would resolve the temporary support arrearages issue after considering the evidence presented at trial, without objection by the parties. Also, the court's reservation of jurisdiction was retroactive only to arrears owed as of August 9, 2013, the date when Anne filed her stillpending request. The court's assertion of jurisdiction was therefore authorized by Family Code section 3653, subdivision (a). The principal limitation in the statute-that such an assertion of jurisdiction must not run afoul of section 666(a)(9) of title 42 of the United States Code-was met.
Indeed, as we have indicated in footnote 20 above, James, in the course of his requesting that the court terminate support for Anne or impute income to her, argued the court had reserved jurisdiction to retroactively modify all child and spousal support. He appears to have benefited from this position, since he succeeded in persuading the court to consider the merits of his request, even though the court ultimately denied it in its FSOD. Under these circumstances, it would appear the doctrine of judicial estoppel bars any appellate claim from him to the contrary. (See, e.g., Owens v. County of Los Angeles (2013) 220 Cal.App.4th 107, 121-123 [discussing elements of judicial estoppel].) However, we do not determine this issue in light of our conclusion here.
Nothing in the case James relies on, Gruen, supra, 191 Cal.App.4th 627, alters our analysis. In Gruen, the trial court, ruling at a hearing regarding the husband's order to show cause (OSC) regarding child and spousal support and other matters, issued interim temporary child and spousal support orders and continued the hearing in order to further determine with the aid of a court-appointed expert what income the husband had that was available for support. (Id. at pp. 632-633.) At the husband's subsequent request, the court took his OSC off calendar and the parties stipulated that the court's interim orders, which the court confirmed were enforceable, would remain in effect pending further court order. (Id. at p. 633.) The husband's OSC was not continued and he never filed a motion or OSC for a modification of the interim order. (Ibid.) Regardless, at a later hearing, the trial court asserted it was" 'continuing to reserve jurisdiction on setting temporary orders.'" (Ibid.) It also later asserted that it could always retain jurisdiction to retroactively modify a temporary order. (Id. at p. 634.)
Eventually, the expert submitted his report and the court indicated that the husband may have overpaid support. (Gruen, supra, 191 Cal.App.4th at p. 634.) After the court clarified that there was no pending motion to modify its interim order, the wife argued the court lacked jurisdiction to modify that order regardless of any overpayment. (Id. at pp. 634-635.) The court disagreed and subsequently modified the interim order in the husband's favor. (Id. at pp. 635-636.)
The appellate court held the trial court's retroactive modification of its interim order exceeded its jurisdiction because, under the circumstances of the case, that order was immediately operative and directly appealable, had become final, and was not subject to collateral attack. (Gruen, supra, 191 Cal.App.4th at p. 639.) Further, the court could not prospectively modify the interim order because there was no pending motion or OSC for modification of it, the husband's OSC having been taken off calendar and the matter having not been continued. (Id. at p. 640.)
The circumstances in Gruen are different than those before us. Unlike in Gruen, the court's rulings at the November 22, 2013 hearing and in its May 11, 2015 order indicate the issue of temporary support arrearages retroactive to August 9, 2013 was still unresolved and that the trial court was maintaining jurisdiction over it. Moreover, Anne never withdrew her request. Accordingly, the resolution of the issue remained pending before the court (despite the court taking the matter off calendar in December 2013, as we have discussed). The court was entitled under section 3653, subdivision (a) to modify its May 11, 2015 order regarding temporary support arrearages in its FSOD in order to finally resolve the pending issue.
C. The Court Did Not Abuse Its Discretion in Issuing Its FSOD Temporary Support Arrearages Orders
James also argues, somewhat cursorily, that, even if the trial court had jurisdiction to modify its May 11, 2015 order in its FSOD, it erred in ordering that Anne was entitled to any arrearages because she did not meet her burden of demonstrating these arrearages existed, having put forward no evidence that James's monthly income ever exceeded $23,000 and the court having stricken the testimony of James's expert. This argument is also unpersuasive.
" 'During the pendency of any proceeding for dissolution of marriage . . ., the court may order . . . either spouse to pay any amount that is necessary for the support of the other spouse ....' (Fam. Code, § 3600.) 'Temporary spousal support is awarded under [Family Code] section 3600. It is based on the supported spouse's needs and the other spouse's ability to pay. [Citation.]" 'Whereas permanent spousal support "provide[s] financial assistance, if appropriate, as determined by the financial circumstances of the parties after their dissolution and the division of their community property," temporary spousal support "is utilized to maintain the living conditions and standards of the parties in as close to the status quo position as possible pending trial and the division of their assets and obligations." [Citations.]' [Citation.] The court is not restricted by any set of statutory guidelines in fixing a temporary spousal support amount."' [Citations.] 'Temporary support . . . usually is higher than permanent support because it is intended to maintain the status quo prior to the divorce.' [Citation.] [¶] 'The trial court has broad discretion to determine the amount of temporary spousal support, considering both the supported spouse's need for support and the supporting spouse's ability to pay.'" (In re Marriage of Pletcher (2021) 68 Cal.App.5th 906, 912-913.)
"[I]n exercising its broad discretion, the court may properly consider the 'big picture' concerning the parties' assets and income available for support in light of the marriage standard of living." (In re Marriage of Wittgrove (2004) 120 Cal.App.4th 1317, 1327.) "[A] payor can satisfy his or her spousal support obligation in myriad ways," including by making "mortgage payments on the family residence ...." (In re Marriage of Brewster &Clevenger (2020) 45 Cal.App.5th 481, 514.)
"We review spousal support orders under the abuse of discretion standard, examining the order for factual and legal support. [Citation.] We will affirm the trial court's decision if the court exercised its discretion along legal lines, where there is substantial evidence to support the decision." (In re Marriage of Brewster &Clevenger, supra, 45 Cal.App.5th at p. 514.)
James does not challenge the court's temporary support arrearages orders on the grounds that they were inconsistent with the family's standard of living during marriage or that Anne did not need the support ordered. Rather, he simply argues that Anne did not establish that his post-separation income ever exceeded $23,000 a month. While he is correct that Anne did not offer any such evidence, we fail to see why she was required to do so. James testified that he had made no Smith/Ostler payments to Anne. Further, asked if he ever had income over $23,000 a month between July 1, 2014 and June 1, 2017, he testified, "[Y]es, I have had months where the profit of the business was more than 23,000, and I've had many months where the profit of the business was less than 23,000." He further testified that he received quarterly payments from PESC. Given this testimony and the broad discretion of the court to make temporary support orders, we conclude the trial court did not abuse its discretion in the temporary support arrearages orders it made in its FSOD.
James's Claim III
Next, James argues the trial court committed two errors in its FSOD based on the incorrect conclusion that there were two HELOC loans, x5148 and x3672, when in fact these loans were in effect one and the same. His arguments challenge the court's factual findings and, therefore, we review them under a substantial evidence standard of review.
Specifically, James, relying on the unadmitted Comerica statements contained in his Exhibit P, contends that x5148 was community debt that was moved to x3672 sometime in 2017, and that thereafter x5148 had a zero balance and x3672 held the parties' HELOC community debt. He contends that, therefore, the trial court erred in ordering (1) that x5148 be paid out of the proceeds from the sale of the family residence prior to distribution of the resulting equity to the parties, and (2) that James pay the outstanding balance of x3672 from his share of the sales proceeds because that debt was his sole and separate property, the court having concluded based on James's testimony that he used x3672 to pay his business's expenses when he had insufficient business cashflow.
James also proposes what he characterizes as a "simple" remedy, that this court order a modification of the judgment that states," '[T]he Court orders payment of the sale costs, satisfaction of the first mortgage, and satisfaction of the Comerica HELOC secured by the [family] residence of sale proceeds prior to distribution of the parties.' "
As we have already discussed in addressing Anne's claims 3, 4, and 5, we cannot and will not consider the Comerica statements contained in Exhibit P because they were not admitted into evidence. (See Frank v. County of Los Angeles, supra, 149 Cal.App.4th at p. 815; USLIFE Savings &Loan Assn. v. National Surety Corp., supra, 115 Cal.App.3d at p. 343; Western Aggregates, Inc. v. County of Yuba, supra, 101 Cal.App.4th at p. 292; People v. Cordova, supra, 62 Cal.4th at p. 137.) Without these statements, there is no evidence of the existence of x3672. Thus, we agree there is no substantial evidence to support the trial court's order that James pay the outstanding balance contained in x3672 out of his share of the proceeds from the sale of the family residence. We will reverse this part of the FSOD.
As we have also discussed, however, in its FSOD the court found that the parties agreed at the end of trial that the outstanding balance for x5148 was $180,756.51 as of July 11, 2018. Based on this agreement, the court ordered this community debt be deducted from the equity of the family residence before the equity was distributed to the parties. As we have discussed, James does not challenge this finding on appeal. Because James has not met his burden of persuading us why we should reverse the court's order regarding x5148 (JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237), we will affirm the court's ruling that x5148 be paid out of the sales proceeds of the family residence prior to distribution of the home equity to the parties.
James's Claim IV
In his cross-appeal claim IV, James argues the trial court erred in denying his request that it credit him for his post-separation deposit of $151,754 in separate property to a joint Comerica account of the parties. We see no basis for reversal on this point.
In its FSOD, the court found that James had deposited $151,754 in business draws in Comerica account x292. But the court noted that James separately requested reimbursement from Anne for all of her cash withdrawals from the account, which totaled $78,165, based on Anne's breach of fiduciary duty for removing the cash and failing to account for it. The court granted this separate reimbursement request, finding that Anne transferred this $78,165 without James's knowledge and failed to subsequently account for the funds, thereby breaching her fiduciary duty to him.
The trial court concluded that James was not entitled to credit for his deposit of $151,754 into x292 because it separately granted his reimbursement request. According to the court, "Awarding him a credit for one half of his separate property deposits in addition to the breach of fiduciary duty claim would result in reimbursement to him of an amount exceeding his separate property deposits." The court denied his claim. James now argues the trial court "clearly abused its discretion and would have granted James a full reimbursement but for the finding regarding breach of fiduciary duty. James would have received reimbursement for the full $151,754 but only received a credit of $78,165." He further asserts, "There is no rational reason not to have granted the full reimbursement."
We review the trial court's order for abuse of discretion. (See In re Marriage of Furie (2017) 16 Cal.App.5th 816, 825; In re Marriage of Reilley (1987) 196 Cal.App.3d 1119, 1123-1125.) Also, as cross-appellant, James has the burden of persuasion regarding his claim. (JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237.)
James does not identify any evidence showing what became of the funds he deposited into Comerica account x292 net of Anne's improper withdrawals. Without considering such evidence, we cannot conclude the trial court had no rational reason for rejecting his claim to those funds. The court's reasoning is unclear, and does raise questions, but we cannot simply assume the determination it made lacks a logical foundation in the evidence. James's separate property funds net of Anne's withdrawals may have remained in the account and simply need to be reimbursed; the funds may have been withdrawn by James and spent for community purposes, thus justifying a credit; the funds may have been withdrawn by James and spent on things personal to him; or some combination of these things may have happened. From the record citations James relies upon, we can make no assessment. We decline to search the record on our own in an effort to bring clarity to the questions raised here.
Because James has not met his burden of persuasion, we reject his claim IV.
James's Claim V
In his cross-appeal claim V, James argues two reasons why the trial court erred in ordering Anne to reimburse him $23,415.07 for the late payment penalties and interest he paid in 2014 arising from the failure to pay 2011 taxes: first, the court overlooked $7,171.46 in interest he paid in 2014 and, second, the court should have ordered for breach of fiduciary duties that Anne to reimburse him for tax penalties he paid in 2012 and 2013 because the record "demonstrates that Anne had substantial additional funds that could have been used to pay the 2011 taxes due in 2012."
As we discussed, the trial court ruled that Anne breached her fiduciary duty by her concealment of community funds. The funds were comprised of $289,186 of cashier's checks Anne placed in the Trust account, $55,000 in community funds that she took from a bank account in February 2012, $41,000 in patient checks that she took from TEC, and $69,000 she took from a TEC account. The court concluded her breach of her fiduciary duty by her concealment of these funds caused James to pay community tax penalties and interest, and ordered as a remedy that she reimburse James for his payment of $23,415.07 for the delinquent 2011 taxes, the amount the court found James paid in 2014 based on his Exhibit PP. The court declined to attribute the entirety of the $39,357.77 in tax penalties and interest it found James paid for the delinquent 2011 taxes to Anne's post-separation removal of funds. The court did so based on its finding that the IRS began imposing late payment penalties and interest in November 2012, which was before the parties' separation and at a time when the only funds Anne concealed in breach of her fiduciary duty were $55,000, an amount the court found "insufficient to pay the outstanding tax liability."
As we have also already discussed in addressing Anne's claims 4, 5, and 10 above, Family Code section 1100, subdivision (e) requires that spouses act as fiduciaries to each other with regard to their management and control of community assets and liabilities in accordance with the general rules governing fiduciary relationships specified in Family Code section 721. Family Code section 721, subdivision (b) provides, "[I]n transactions between themselves, spouses are subject to the general rules governing fiduciary relationships that control the actions of persons occupying confidential relations with each other," including rules requiring the disclosure of true and full information regarding community property. (§ 721, subd. (b) (1)-(3).)
Family Code section 1101 governs remedies for a spouse's breach of fiduciary duty to a spouse under Family Code sections 1100 and 721 "that results in impairment" to the claimant spouse's one-half interest in the community estate, including transactions that "have caused or will cause a detrimental impact" to that interest. (Fam. Code, § 1101, subd. (a).) "[W]hen the breach falls within the ambit of Section 3294 of the Civil Code," remedies "shall include, but not be limited to, an award to the other spouse of 100 percent, or an amount equal to 100 percent, of any asset undisclosed or transferred in breach of the fiduciary duty." (Fam. Code, § 1101, subd. (h).) We review a trial court's ruling regarding the appropriate remedy for a breach of fiduciary duty for abuse of discretion. (See Schleich, supra, 8 Cal.App.5th at p. 284.)
Civil Code section 3294, subdivision (a) provides, "In an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant."
James first contends the trial court erred in its calculation of the taxes and penalties that he paid in 2014 by omitting $7,176.46 in interest that he paid on November 10, 2014, ordering Anne to reimburse him only $23,415 rather than the correct amount of $30,587. Notably, while the trial court relied on Exhibit PP for its calculations, James cites his own trial testimony. James correctly does so because Exhibit PP was marked for identification but it was not admitted into evidence.
But James is incorrect in his own calculations. He testified at trial that in 2014 he paid interest of $7,171.46 and a penalty of $22,820.48 for a total of $29,991.94, not $30,587; he did testify that he paid an additional $594.59 in interest, but said that he did so in 2015. His calculation error hints at the difficulty involved in determining whether or not the trial court abused its discretion in ordering Anne to reimburse James only $23,415.07 of the total payments of interest and penalties by James in 2014: it is unclear from the court's FSOD whether it reached its determination of this figure based entirely on what James paid in 2014 or based at least in part on its settling on a figure that it concluded was appropriate to remedy Anne's breach of her fiduciary duty under Family Code section 1101, subdivision (h). We have no way of determining anything further about the court's thinking because it cited only the unadmitted Exhibit PP for the figure. Given these circumstances, we conclude that James has not met his burden of persuasion as cross-appellant of showing the trial court abused its discretion in limiting Anne's reimbursement to him to $23,415.07. (See People v. JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237.)
Second, James argues the trial court should have ordered Anne to reimburse him for tax penalties he paid in 2012 and 2013 for the delinquent 2011 taxes because the record "demonstrates that Anne had substantial additional funds that could have been used to pay the 2011 taxes due in 2012." He cites to various places in the record indicating funds available to Anne at the time. His argument ignores that the trial court based its reimbursement ruling on the funds Anne took in breach of her fiduciary duty to James, not the funds she generally had available to her. James fails to show that the trial court abused its discretion in doing so.
In short, we conclude James's cross-appeal claim V provides no basis for reversal of the court's order that Anne reimburse James only $23,415.07 for the penalty and interest payments he made regarding the delinquent 2011 taxes.
James's Claim VII
In his final cross-appeal claim, claim VII (he does not identify a claim VI), James argues the trial court erred in denying his request that Anne be charged with one-half of the $121,450 he contends she withdrew from Comerica account x6272 prior to separation, as indicated by his Exhibit FF, money for which Anne did not account. The trial court denied this request on the grounds that it could not find any references to Exhibit FF in James's testimony, nor any basis in Exhibit FF, which contains voluminous records, for James's request.
On appeal, James does not rely on Exhibit FF for his claim of error. Instead, he contends his Exhibit II, which contains a summary of bank statements from x6272 about which James testified, shows cash withdrawals totaling $121,450. He also cites his related trial testimony regarding these withdrawals, each of which he identified as a cash transfer "to wife," including his testimony that Anne did not tell him what she did with the money. This, he contends, is substantial evidence supporting his request that Anne be charged for one-half of her withdrawals. According to James, the trial court's denial of his request below was in error, as "the court did not exercise its discretion because it did not realize the connection between the statements (FF) and James's testimony that addressed the accounted withdrawals in the context of the FF summary in Exhibit II."
We need not consider the merits of this claim because James has forfeited it. James based his request below on Exhibit FF only, not Exhibit II or his related trial testimony, and he does not contend that he testified about Exhibit FF. The court denied his request in its TSOD on the same grounds as those it stated in its FSOD. James's written objections to the court's TSOD do not include any challenge to that tentative ruling. In other words, James is raising an issue on appeal that he did not first raise below-that the court should have ordered Anne to reimburse him one-half of the $121,450 based on Exhibit II and his trial testimony regarding it. He also fails to supply legal support for his argument. He therefore fails to overcome the same hurdles Anne met in trying to raise the various contentions of hers that we found not cognizable above. The argument has been forfeited for failure to preserve any objection on the trial court and failure to develop it legally on appeal. (Honig, supra, 127 Cal.App.4th at p. 530; Estate of Westerman, supra, 68 Cal.2d at p. 279; JTH Tax, Inc., supra, 212 Cal.App.4th at p. 1237; Cahill, supra, 194 Cal.App.4th at p. 956.)
DISPOSITION
We affirm the trial court's judgment, except that we (1) reverse the trial court's order that Anne reimburse James for his post-separation payments of $281,057.63 for her health care premiums (Anne's claim 1); (2) reverse the trial court's order that Anne reimburse James $27,386.57 for one-half of his post-separation interest and principal payments for a home equity line of credit (Anne's claims 4 and 5); (3) reverse the trial court's order that Anne reimburse James $1,500 for money he transferred to her separate Wells Fargo account in July 2013 (Anne's claim 25); (4) dismiss Anne's challenge to the court's order that she vacate the family residence as moot (Anne's claim 2); and (5) reverse the trial court's order that James pay the outstanding balance contained in the Comerica home equity loan account x3672 from his share of the proceeds from the sale of the family residence (James's claim III). The parties are to bear their own costs.
WE CONCUR: BROWN, P. J., GOLDMAN, J.