Opinion
E070207
09-04-2019
In re Marriage of ZILPA and LUIS ANGEL MENDEZ. ZILPA MENDEZ, Respondent, v. MARTHA MOLINA, as Administrator, etc., Appellant. Estate of LUIS MENDEZ, Deceased. MARTHA MOLINA, as Administrator, etc., Petitioner, Objector and Appellant, v. ZILPA MENDEZ, Objector, Petitioner and Respondent.
The Law Firm of Fox and Fox, Frank O. Fox and Michael J. Lee for Petitioner, Objector and Appellant, Martha Molina. Bawden & Kochis, Richard E. Bawden and Robert A. Kochis for Objector, Petitioner and Respondent, Zilpa Mendez.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super.Ct.No. RID1103927) OPINION (Super.Ct.No. RIP1501250) APPEAL from the Superior Court of Riverside County. Thomas H. Cahraman, Judge. Affirmed in part; dismissed in part. The Law Firm of Fox and Fox, Frank O. Fox and Michael J. Lee for Petitioner, Objector and Appellant, Martha Molina. Bawden & Kochis, Richard E. Bawden and Robert A. Kochis for Objector, Petitioner and Respondent, Zilpa Mendez.
After 30 years of marriage, Luis Mendez (decedent) and Zilpa Mendez (Zilpa) divorced. As part of a stipulated judgment for dissolution of the marriage, Zilpa was awarded her one-half community property interest in decedent's 401(k) plan, to be divided by a qualified domestic relations order (QDRO). Decedent subsequently married appellant Martha Molina (Molina) and died intestate 18 months later, before decedent or Zilpa had completed a QDRO. Molina initiated a probate case (case No. RIP1501250). The probate court appointed her as personal representative of decedent's estate and issued letters of administration to her.
In order to avoid confusion among parties with the same last name, we will refer to Zilpa by her first name. We mean no disrespect in doing so. (Estate of O'Connor (2018) 26 Cal.App.5th 871, 875, fn. 2.)
One year four months after decedent died, Zilpa filed a request for order (RFO) in the family court (case No. RID1103927) for a QDRO to satisfy her interest in the 401(k) account under the judgment. Molina opposed the request, arguing, inter alia, the family court lacked jurisdiction to enforce the judgment, and Zilpa was required to pursue her claim in the probate court. In the meantime, the administrator of the 401(k) plan paid the balance of decedent's account (minus taxes, fees, and repayment of loans) in a lump sum to Molina. The family court denied Zilpa's RFO without prejudice and ordered Molina to retain the money from the 401(k) account in her attorney's trust account pending further order for distribution by the probate court. Molina and Zilpa then filed competing petitions in the probate court, in which they argued over the probate and/or family court's ability to enter a nunc pro tunc order for a QDRO consistent with the anti-alienation and state law preemption provisions of the Employment Retirement Income Security Act (ERISA; 29 U.S.C. § 1001 et seq.). Molina also consistently took the position that Zilpa had not timely complied with the Probate Code creditor claim statute within the applicable one-year statute of limitations.
The probate court took jurisdiction over the family court case and, after hearing arguments on the respective petitions: (1) concluded it had continuing jurisdiction in the family court case to enforce the judgment and authority consistent with ERISA to enter a nunc pro tunc order for a QDRO; (2) granted Zilpa's RFO and appointed Zilpa's retained attorney to prepare a QDRO; and (3) granted Zilpa's petition in the probate case for distribution of estate assets to satisfy the judgment.
As she did below, Molina argues the trial court's orders ran afoul of the anti-alienation and state law preemption provisions of ERISA. As we explain, post, the overwhelming weight of authority in the United States Courts of Appeals is that ERISA no longer applies once the third party administrator of an employee retirement account fully pays the funds to a beneficiary. At that point, the propriety of the court's order dividing those funds is a matter of state law. We conclude the trial court properly exercised its broad authority to enter a nunc pro tunc judgment to enter a QDRO to clarify what had already been awarded and ordered in the stipulated judgment. Because we affirm the order in the family law case, we need not decide whether the order in the probate case—which had the same practical effect—was correctly entered. Even if we were to reverse the probate order, the result would be the same. Therefore, we will dismiss as moot the appeal from the probate court order.
I.
FACTS AND PROCEDURAL BACKGROUND
A. Stipulated Divorce Judgment Between Decedent and Zilpa (Case No. RID1103927).
Decedent and Zilpa were married on May 10, 1980. They separated because of irreconcilable differences in February 2011 and, that August, Zilpa filed a petition for dissolution of the marriage. The family court entered a stipulated final judgment of dissolution on July 25, 2012, which divided the marital community's assets and debts. Relevant here, the judgment awarded Zilpa "[o]ne-half community interest in [decedent's] J.P. Morgan Chase 401(k) [account], accumulated during the marriage and prior to separation, to be divided by QDRO." Decedent agreed to be solely responsible for any loans or debts against the 401(k) account.
The judgment provided each party would "execute and deliver any and all documents necessary to carry out the terms of this [judgment] that deal with the division of assets and liabilities no later than thirty (30) days from the date of the execution of this JUDGMENT." If either spouse failed to comply within 30 days, the judgment provided "either party may, upon appropriate application and without notice to the other party, appoint the Court clerk as its commissioner to execute said documents." The judgment also provided the family court retained jurisdiction to enforce the provisions of the judgment.
B. Decedent Married Molina, and Molina Opened Probate Proceedings When Decedent Died (Case No. RIP1501250).
Seventeen months after the divorce was final, decedent married Molina in December 2013. He died intestate 20 months later on August 9, 2015, and three months after that, Molina initiated probate proceedings on November 30, 2015. On January 5, 2016, Molina filed proposed letters of administration and a proposed order for probate. She requested the probate court order a bond of $290,000. In an attachment to her proposed order for probate, Molina suggested the following order: "The Personal Representative of the Estate may not marshal any 401k account, in the name of the Decedent, LUIS A. MENDEZ, without further Order of Court."
Molina served Zilpa and her adult children on January 19, 2016, by mail with notice that a petition for administration of the estate had been filed. On April 6, 2016, Molina filed with the probate court proof she had published notice of the administration of the estate.
The probate court granted Molina's subsequent petition for letters of administration on May 9, 2016; entered an order for probate on July 8, 2016 with a $290,000 bond and an order that Molina not "marshal" decedent's 401(k) funds; and issued letters of administration to Molina on July 19, 2016.
On August 23, 2016, Molina's attorney filed a declaration with the probate court stating Molina had learned decedent's 401(k) plan had a then-current balance of $530,220.12, so she requested the court increase her bond to $530,220. Molina also requested an order authorizing her to take custody of decedent's retirement benefits and/or 401(k) funds. On September 16, 2016, Molina's attorney filed an additional declaration stating Molina believed, to the best of her knowledge, that decedent's 401(k) plan was "the only asset of the Decedent's Estate at the time of his death," and the value of the account had increased to $535,953.65. Molina requested the bond be increased appropriately and again requested the probate court authorize her to take custody of the 401(k) account.
C. Zilpa Filed an RFO in the Family Court Case to Enforce Her Interest in the 401(k) Plan Under the Stipulated Judgment.
Zilpa filed an RFO in the family court case on December 15, 2016, requesting the court enter a QDRO to enforce Zilpa's interest in decedent's 401(k) account or appoint an expert under Evidence Code section 730 to prepare one. Zilpa served the administrator of the 401(k) plan with a summons and joined it in the family court case.
We granted in part Zilpa's motion to augment the record on appeal, and deemed the following documents from the family court case to be part of the record: (1) Zilpa's RFO filed December 15, 2016; (2) Zilpa's summons and joinder of the third party administrator of the 401(k) account filed December 28, 2016; (3) Molina's responsive declaration to the RFO filed January 18, 2017; and (4) Zilpa's points and authorities in support of the renewed RFO filed November 22, 2017. On our own motion, we now deem the family court's June 29, 2017 minute order (case No. RID1103927) denying Zilpa's RFO without prejudice to be part of the record on appeal.
In her response to the RFO filed January 18, 2017, Molina argued (1) Zilpa's RFO was untimely because she had waited three and a half years after entry of the judgment and 16 months after decedent died to file it, (2) Molina had requested decedent's 401(k) benefits be transferred to her as personal representative of the estate, and (3) the probate court had jurisdiction to determine any claims against the estate, including Zilpa's. On June 19, 2017—10 days before the family court heard Zilpa's RFO—the third party administrator of the 401(k) account issued a check to Molina for $440,382.60 representing the entire balance of the account (after payment of fees, repayment of loans, and tax withholdings). Molina also filed an objection to Zilpa's request for an evidentiary hearing in the family court case, arguing the probate court had jurisdiction over the estate and Zilpa had waived her right to enforce the judgment by not doing so sooner.
On June 29, 2017, the family court denied Zilpa's RFO without prejudice and ordered Molina's attorney "to deposit the [401(k)] funds in his trust account, act as trustee, and hold said funds until further order of the Probate Court."
D. Molina's Petition for Instructions and Zilpa's Petition for Transfer of Personal Property Filed in the Probate Case.
While the proceedings in the family court on Zilpa's RFO were ongoing, Molina filed an inventory and appraisal in the probate court on February 14, 2017, informing the probate court that the sole asset of the estate—decedent's 401(k) plan—was now valued at $542,000. And in an April 20, 2017 response to an order to show cause (OSC) issued by the probate court, inquiring what estate assets were subject to appraisal by a probate referee, Molina's attorney filed a declaration repeating Molina's understanding that the sole asset of the estate was the 401(k) plan, "consisting entirely of cash on deposit." Molina informed the probate court that the value of the inventory was subject to change because Zilpa's RFO was still pending in the family court.
On June 2, 2017, Molina filed a status report of administration. Eleven days later, Molina's attorney filed yet another declaration in response to an OSC from the probate court inquiring into estate assets subject to appraisal by a probate referee. Once again, counsel informed the court the only asset of the estate at the time of decedent's death was the 401(k) plan.
On July 26, 2017, the probate court conducted a hearing on a petition filed by Molina for approval of her status report on the administration of the estate. Zilpa's attorney made a special appearance at the hearing. The probate court approved the most recent status report; ordered Molina to file an updated status report within two months; and, like the family court, ordered Molina's attorney to retain the 401(k) funds in his trust account. A notice of ruling served by Molina's attorney on July 27, 2017 (but not filed until Aug. 3, 2017) stated: (1) the probate court had encouraged Molina to file a petition for instructions concerning disposition of the funds transferred from decedent's 401(k) account and set a hearing on October 27, 2017; and (2) Zilpa's attorney had informed the probate court Zilpa intended to file her own petition, and the probate court set it for hearing on the same day as Molina's petition.
On August 22, 2017, Molina's attorney filed an updated inventory and appraisal which now indicated there were no estate assets, and the value of the estate was zero. In a declaration filed with the inventory, Molina's attorney indicated: (1) no beneficiary was designated for decedent's 401(k) plan at the time of his death and, therefore, under the terms of the plan, the benefits were payable directly to Molina as the surviving spouse; and (2) because the benefits were payable directly to Molina instead of to the estate, the revised inventory and appraisal listed the value of the estate at zero.
The next day, Molina filed a petition for instructions requesting the probate court find there were no assets in the estate, and the funds from decedent's 401(k) account could be distributed directly to her. Molina argued Zilpa had no legitimate claim against the estate because the 401(k) account was governed by ERISA and, once Molina's right to those funds as the surviving spouse vested upon decedent's death, the court could not lawfully enter a nunc pro tunc order for a QDRO to divide the funds according to the divorce judgment. Molina also argued Zilpa did not timely file a claim against the estate pursuant to the Probate Code and within the applicable one-year statute of limitations that began to run when decedent died. Assuming, arguendo, Zilpa's RFO could be construed as an otherwise proper claim under the Probate Code, Molina argued it was not filed within the one-year statute of limitations. Therefore, Molina argued the estate should be closed for lack of estate assets.
Molina filed her updated status report on September 26, 2017, in which she stated the earlier inventory and appraisal listing the 401(k) plan as an estate asset "was erroneous." Molina once again argued that, because the 401(k) plan had no designated beneficiary at the time of decedent's death, under the terms of the plan, the funds passed directly to Molina as the surviving spouse and were not assets of the estate.
On October 20, 2017, Zilpa objected to Molina's petition for instructions contending (erroneously) the proceeds of decedent's 401(k) account were transferred to Molina as the personal representative of the estate and, therefore, the probate court should deny the request to close the estate for lack of assets. The same day, Zilpa filed a petition in the probate court requesting an order to confirm transfer of personal property from the estate to a former spouse. She argued the probate court had authority under Probate Code section 850, subdivision (a)(2)(A) and (a)(2)(C), to order the estate to satisfy its obligation under the judgment and pay Zilpa her one-half of the community interest in the 401(k) plan.
On October 27, 2017, the probate court continued the hearing on the competing petitions to December 8, 2017, to permit Molina to file objections to Zilpa's petition. Molina's attorney informed the probate court Zilpa had filed an ex parte application in the family court requesting essentially the same relief she was seeking from the probate court. The probate court indicated it had jurisdiction and ordered the family court case transferred to itself and set Zilpa's ex parte application for hearing on December 8, 2017.
Neither party objected to the probate court transferring the family court case to itself, and on appeal neither party challenges the propriety of that order.
Molina filed her objections to Zilpa's petition on November 13, 2017, and responded to the objections to her own petition. Molina again argued Zilpa had failed to timely enforce the judgment under its terms or in compliance with the Probate Code, and argued Zilpa "effectively admit[ted] she ha[d] no facts or authority, which excuse[d] her own failure to comply with the applicable statutes." Molina further argued Zilpa became aware of the administration of the estate when she was served with notice on January 19, 2016, yet she failed to timely submit a creditor claim as mandated by the Probate Code.
Zilpa filed a verified response to Molina's objections on November 28, 2017. She stated that, after the stipulated divorce judgment was entered, decedent had asked her "not to divide the [401(k)] Plan until he paid back the loans he borrowed from the Plan." In April 2015, Zilpa asked her adult son to contact decedent and ask him to divide the plan. "At first [decedent] did not want to pay for a QDRO." Decedent later agreed to pay one-half of the fees for a QDRO, but he died that August before a QDRO was completed. Zilpa retained an attorney sometime in 2016 to prepare a QDRO and, on June 23 of that year, she notified the plan of her interest in the 401(k) account. According to Zilpa, in July 2016, the plan approved her proposed QDRO, but Molina refused to sign it. Zilpa then retained the attorney who filed her RFO and joined the plan in the family court case in December 2016. Zilpa argued she was not a creditor for purposes of the Probate Code, so she was not required to timely submit a creditor's claim. Zilpa also argued the family court retained jurisdiction under state law and under ERISA to enforce the divorce judgment by entering a nunc pro tunc order for a QDRO. Therefore, Zilpa requested the probate court/family court enter a nunc pro tunc order for a QDRO or, in the alternative, order the estate to pay her one-half community property interest in the 401(k) account pursuant to the judgment.
On December 4, 2017, Molina filed a sur-reply in which she argued Zilpa failed to cite any authority for her "novel argument" that she was not a creditor of the estate and could request payment from the estate pursuant to Probate Code section 850 instead of timely complying with the creditor claims statute. Molina again argued the funds from decedent's 401(k) account passed directly to her as the surviving spouse and were not estate funds, and further argued ERISA prohibited the court from entering a nunc pro tunc order for a QDRO.
E. Combined Hearing and Ruling on Zilpa's RFO in the Family Court Case and the Parties' Competing Petitions in the Probate Case.
At the hearing, the parties focused primarily on whether the family court had authority consistent with ERISA to enter a nunc pro tunc order for a QDRO. But Molina's attorney once more argued Zilpa did nothing to enforce her rights under the judgment until three and a half years after the judgment was entered, 16 months after decedent died, and five months after the probate court issued letters of administration. When asked if the competing petitions were "ripe" for submission or if he believed there was a need for testimony, Molina's attorney responded: "If the Court has any question with respect to the reason for the delay and thinks that's important, then [there] might be [a need for] testimony. If it doesn't—which personally, I don't believe it matters with respect to their claims for why Zilpa waited—then I don't believe testimony would be necessary." Zilpa's attorney argued his points and authorities "stated sort of an offer of proof" with regard to why Zilpa delayed filing a QDRO and said, "I think probably we do need testimony, so the Court has a clear statement of facts." But, rather than take testimony, the court took the matter under submission.
In its ruling on submitted matter, the probate court stated it had transferred the family court case to itself to "increase efficiency and avoid the risk of inconsistent results." The court concluded it had continuing jurisdiction in the family court case to enforce the stipulated judgment against Molina as the representative of decedent's estate, and the court had authority, consistent with ERISA, to enter a nunc pro tunc order for a QDRO. Although the court questioned whether a QDRO was necessary "because now we have cash in [Molina's attorney's] trust account," and there was no longer a need to enter an order against the plan administrator, the court indicated a QDRO might still be necessary because "the same math needs to be done, in order to calculate the exact amount owed to Zilpa from those funds." The court (1) concluded Zilpa was entitled to the relief she sought in the family court case and granted her RFO, (2) appointed Zilpa's retained attorney to prepare a QDRO and forward it to all parties and their attorneys for signatures, and (3) directed the parties to return to the family court for enforcement if either party refused to sign.
With respect to the probate court case, the court granted Zilpa's petition "by way of a finding that Zilpa Mendez is entitled to a portion of the 401(k) funds held in trust, as appropriate under the family law judgment entered 7/25/2012, and the laws pertaining to the division of such an asset upon dissolution of marriage, all to be defined specifically under the QDRO ordered hereinabove in the family law case." The court denied Molina's petition for instructions and found Zilpa to be the prevailing party entitled to costs on both petitions.
Molina requested a statement of decision, but the court denied the request as untimely. Molina timely appealed.
II.
DISCUSSION
A. Scope of Appeal.
The rulings on submitted matters in the family court case, granting Zilpa's RFO and ordering a QDRO to enforce the judgment, are appealable postjudgment orders. (Code Civ. Proc., § 904.1, subd. (a)(2); see In re Marriage of Wilcox (2004) 124 Cal.App.4th 492, 497.) And the rulings on submitted matters in the probate case granting Zilpa's petition and directing the estate to pay out funds to satisfy Zilpa's interest in the 401(k) funds and denying Molina's petition for instructions are also appealable. (Prob. Code, § 1300, subds. (c), (g); see Estate of Sapp (2019) 36 Cal.App.5th 86, 99.)
"An appeal, other than in a limited civil case, . . . may be taken from . . . [¶] . . . [¶] . . . an order made appealable by the Probate Code . . . ." (Code Civ. Proc., § 904.1, subd. (a)(10).)
In her respondent's brief, Zilpa argues Molina failed to appeal from the trial court's order in the family court case granting Zilpa's RFO and, therefore, the only order properly before this court is the one entered in the probate case granting Zilpa's petition and denying Molina's petition. We are not persuaded.
To appeal from an appealable order or judgment, a party must timely file a notice of appeal in the superior court. (Cal. Rules of Court, rules 8.100(a)(1), 8.104.) "Our jurisdiction is 'limited in scope to the notice of appeal and the judgment [or order] appealed from.'" (Ellis v. Ellis (2015) 235 Cal.App.4th 837, 846.) "The notice of appeal must be liberally construed. The notice is sufficient if it identifies the particular judgment or order being appealed." (Cal. Rules of Court, rule 8.100(a)(2).) The rule of liberal construction is meant to protect the right to appeal if it is "reasonably clear" what judgment or order the appellant is challenging. (Luz v. Lopes (1960) 55 Cal.2d 54, 59.) "This policy is especially vital where the faulty notice of appeal engenders no prejudice and causes no confusion concerning the scope of the appeal." (Norco Delivery Service, Inc. v. Owens-Corning Fiberglas, Inc. (1998) 64 Cal.App.4th 955, 960-961.) "In determining whether a respondent has been misled by errors on the face of the notice of appeal, a reviewing court may consider the contents of the designation of record . . . ." (D'Avola v. Anderson (1996) 47 Cal.App.4th 358, 362.)
As indicated, ante, the probate court transferred the family court case to itself and filed its rulings on submitted matters on January 12, 2018, which included both case numbers and separate orders entered in each case. The minute order from the probate court case only included the orders granting Zilpa's petition and denying Molina's petition for instructions, but stated, "For complete ruling please see Filed Ruling on Submitted Matter."
Molina's notice of appeal was filed under the probate court case number; it listed the date of the court's ruling; and it cited the relevant Code of Civil Procedure and Probate Code sections authorizing the appeal. Molina's notice of designating the record on appeal was also filed under the probate court case number, but Molina designated documents from the probate court case and the family court case. Molina properly served Zilpa with the notice of designation of record. Finally, in her civil case information statement filed in this court and served on Zilpa (see Cal. Rules of Court, rule 8.100(g)), Molina checked the boxes for "Family law" and "Probate" under "Nature of action."
The clerk of the superior court did not include the documents from the family court case in the clerk's transcript on appeal. As indicated, ante, footnote 2, Zilpa moved this court to augment the record on appeal with certain documents filed in the family court case, and this court granted the motion in part.
We conclude it is reasonably clear from the record that Molina intended to appeal from the probate and family court rulings on submitted matters, which were entered on the same date and in the same written ruling. (See In re Angelina E. (2015) 233 Cal.App.4th 583, 585, fn. 2 [liberally construing notice of appeal from one appealable order to include another appealable order entered at the same hearing]; In re Daniel Z. (1992) 10 Cal.App.4th 1009, 1017 [liberally construing notice of appeal listing only nonappealable order to embrace appealable order entered simultaneously on same day].) Molina may not have entered the family court case number in her notice of appeal, but it is simply inconceivable Zilpa would have been misled into believing Molina did not intend to challenge the order granting Zilpa's RFO in the family court case that had the same practical effect as the order in the probate court case granting Zilpa's petition. Moreover, by designating documents from both cases to be included in the record on appeal and checking the box for "Family law" in her civil case information statement, Molina made it abundantly clear she was challenging the rulings on submitted matters in both cases.
Finally, we are unable to ascertain any prejudice whatsoever to Zilpa from Molina's technical failure to list the family court case number in her notice of appeal. Indeed, it was Zilpa who moved this court to augment the record on appeal with documents from the family court case. (See, ante, fns. 2, 5.) Therefore, we conclude the order entered in the family court case is properly before us.
B. ERISA No Longer Applied to the 401(k) Funds When the Trial Court Entered Its Rulings.
As she did below, Molina argues the trial court's orders enforcing the award to Zilpa under the divorce judgment of her one-half community interest in decedent's 401(k) plan ran afoul of ERISA. But the issue of whether ERISA governed the 401(k) funds and, consequently, limited or altogether preempted the court's ability to make orders regarding the distribution of those funds, has been rendered academic. There is no dispute that the third party administrator of decedent's 401(k) plan distributed 100 percent of decedent's benefits as a lump sum payment to Molina before the court entered its orders, and both the family court and the probate court directed those funds to be deposited and held in Molina's attorney's trust account pending further order of distribution. Once the funds were paid to Molina, ERISA no longer applied to them.
Section 1056 of title 29 of the United States Code (section 1056) governs the form and payment of benefits from a covered pension or employee retirement benefits plan. Section 1056(d) addresses, "Assignment or alienation of plan benefits," and sets forth the general rule of anti-alienation: "Each pension plan shall provide that benefits provided under the plan may not be assigned or alienated." (29 U.S.C. § 1056(d)(1).) Relevant here, that section creates an exception to the anti-alienation rule for QDROs that meet certain requirements: "Paragraph (1) shall apply to the creation, assignment, or recognition of a right to any benefit payable with respect to a participant pursuant to a domestic relations order, except that paragraph (1) shall not apply if the order is determined to be a qualified domestic relations order. Each pension plan shall provide for the payment of benefits in accordance with the applicable requirements of any qualified domestic relations order." (29 U.S.C. § 1056(d)(3)(A).) Likewise, QDROs that meet the statutory requirements of section 1056(d)(3) are expressly exempted from ERISA's preemption of state judicial decisions that "relate to any employee benefit plan." (29 U.S.C. § 1144(a), (b)(7); see id., § 1144(c)(1) [defining "State law" to include "decisions"].)
The requirements for a QDRO under ERISA are extensive, but we need not discuss them further. (See 29 U.S.C. § 1056(d)(3)(B)-(N).)
The United States Courts of Appeals for the First, Second, Third, Sixth, Seventh, Ninth, and Tenth Circuits have held ERISA's anti-alienation rule and state law preemption provision only apply while employee retirement benefits are still held by a third party administrator and no longer apply once the benefits have been distributed to the beneficiary. (Hoult v. Hoult (1st Cir. 2004) 373 F.3d 47, 54-55, cert. den. (2004) 543 U.S. 1002; Robbins v. DeBuono (2d Cir. 2000) 218 F.3d 197, 203-204, cert. den. sub nom. Robbins v. Novello (2001) 531 U.S. 1071, abrogated on another ground by Wojchowski v. Daines (2d Cir. 2007) 498 F.3d 99, 110; Trucking Employees of North Jersey Welfare Fund, Inc. v. Colville (3rd Cir. 1994) 16 F.3d 52, 54-56; Central States, Southeast & Southwest Areas Pension Fund v. Howell (6th Cir. 2000) 227 F.3d 672, 678-679; NLRB v. HH3 Trucking, Inc. (7th Cir. 2014) 755 F.3d 468, 470-472; Wright v. Riveland (9th Cir. 2000) 219 F.3d 905, 919-921; Guidry v. Sheet Metal Workers Nat'l Pension Fund (10th Cir. 1994) 39 F.3d 1078, 1081-1083 (en banc), cert. den. (1995) 514 U.S. 1063.) As the Seventh Circuit most recently put it, ERISA applies to "assets in a plan's hands" and "in their charge," but does not apply "to the money after the plan distributes it to beneficiaries." (NLRB v. HH3 Trucking, Inc., at p. 470.)
The lone holdout is the Fourth Circuit. (U.S. v. Smith (4th Cir. 1995) 47 F.3d 681, 683-684.) --------
Molina argues ERISA applies to the 401(k) funds because the cases cited in the previous paragraph addressed section 1056(d)(1), and not section 1056(d)(3), the section she argues is applicable here. But as noted, ante, ERISA's anti-alienation rule is contained in section 1056(d)(1). Section 1056(d)(3) provides a limited exception to that rule for QDROs that meet certain requirements. (See Boggs v. Boggs (1997) 520 U.S. 833, 839; Stewart v. Thorpe Holding Co. Profit Sharing Plan (9th Cir. 2000) 207 F.3d 1143, 1149.) If the general rules of anti-alienation and state law preemption no longer apply once the plan funds are fully distributed, then it logically follows there is no need to satisfy the exceptions to those rules with a QDRO that meets ERISA's requirements.
Finally, Molina argues ERISA applies because the 401(k) funds have not yet been completely distributed, pending a final resolution of this proceeding. True, by order of both the family and probate courts, the money is being held in trust by Molina's attorney, meaning Molina does not yet have full access to that money. But, Molina's inability to access the funds now is irrelevant to the question of whether ERISA continues to apply to those funds. There is no dispute whatsoever that the plan administrator paid the entire 401(k) account directly to Molina, the surviving spouse beneficiary under the terms of the plan. It was only after she received the check that the family and probate courts, to maintain the status quo ante, ordered the money deposited in Molina's attorney's trust account. On these facts, ERISA does not apply because the money is simply no longer in the "plan's hands" or under its "charge." (NLRB v. HH3 Trucking, Inc., supra, 755 F.3d at p. 470.) Because ERISA is inapplicable to the already distributed proceeds of decedent's 401(k) account, the propriety of the orders on appeal is purely a matter of state law.
C. The Trial Court Correctly Granted Zilpa's RFO in the Family Court Case (RID1103927).
As noted, ante, the trial court concluded it had continuing jurisdiction in the family law case to enforce the judgment and broad authority to enter a QDRO nunc pro tunc. Although the court indicated a QDRO was no longer necessary because the 401(k) funds had already been paid out, and there was no need to order the third party administrator to divide the funds appropriately between Zilpa and Molina, the court nonetheless concluded a QDRO should be ordered because "the same math needs to be done, in order to calculate the exact amount owed to Zilpa from those funds."
As the trial court correctly recognized, the family court has broad authority to enforce its judgments by execution, appointment of a receiver, or by contempt. (Fam. Code, § 290.) However, upon the death of the judgment debtor spouse, the family court loses jurisdiction to enforce the judgment, and the judgment debtor must pursue judgment enforcement remedies against the estate of the judgment debtor as provided in the Probate Code. (Fam. Code, § 291, subd. (e); Prob. Code, § 9300; Code Civ. Proc., § 686.020; see Schelb v. Stein (2010) 190 Cal.App.4th 1440, 1447-1448.) But, the trial court in this case did not enforce the judgment. Instead, the court entered the judgment nunc pro tunc to include a QDRO that divides the asset whose portion was already awarded to Zilpa in the judgment.
Molina argues the trial court did not properly enter a nunc pro tunc judgment because the stipulated judgment did not sufficiently meet the criteria for a QDRO under ERISA. But, Molina's continued reliance on ERISA and the cases addressing the trial court's authority to enter a nunc pro tunc QDRO consistent with ERISA is misplaced because, as demonstrated ante, ERISA no longer applied to the 401(k) funds once the third party administrator paid those funds to Molina in full.
"'"A court can always correct a clerical, as distinguished from a judicial error which appears on the face of a decree by a nunc pro tunc order. [Citations.] It cannot, however, change an order which has become final even though made in error, if in fact the order made was that intended to be made. . . . 'The function of a nunc pro tunc order is merely to correct the record of the judgment and not to alter the judgment actually rendered—not to make an order now for then, but to enter now for then an order previously made. The question presented to the court on a hearing of a motion for a nunc pro tunc order is: What order was in fact made at the time by the trial judge?'" [Citation.] . . . [N]unc pro tunc orders may not be made to "make the judgment express anything not embraced in the court's decision, even though the proposed amendment contains matters which ought to have been so pronounced. [Citations.]" [Citation.] "It is only when the form of the judgment fails to coincide with the substance thereof, as intended at the time of the rendition of the judgment, that it can be reached by a corrective nunc pro tunc order."'" (APRI Ins. Co. v. Superior Court (1999) 76 Cal.App.4th 176, 185-186, quoting Hamilton v. Laine (1997) 57 Cal.App.4th 885, 890.)
There is no question the stipulated judgment had already awarded Zilpa her one-half community property interest in decedent's 401(k) account, so the nunc pro tunc judgment did not purport to create an interest that did not already exist. (See In re Marriage of Padgett (2009) 172 Cal.App.4th 830, 855.) At most, the nunc pro tunc judgment entered the QDRO—the technical device to put the division into place—that the stipulated judgment expressly provided for but had not yet been perfected. Therefore, this case is not like Marriage of Padgett, where the trial court exceeded its authority to enter a nunc pro tunc QDRO awarding the wife benefits under the deceased spouse's pension because the underlying judgment merely reserved jurisdiction over the pension but gave no indication that the parties intended to divide the plan. (Id. at pp. 837, 850.) In other words, the nunc pro tunc in this case clarified what the court had always intended and did not change history. (See National Union Fire Ins. Co. v. Nationwide Ins. Co. (1999) 69 Cal.App.4th 709, 723 (dis. opn. of Rylaarsdam, J.) [nunc pro tunc order "is not a time machine permitting courts to return to the past and retroactively change history"].)
Because we conclude the trial court properly exercised its authority to enter a nunc pro tunc judgment in the family law case, we need not decide whether the trial court properly granted Zilpa's petition in the probate case. Even if we were to reverse the probate order, the result in this case would be the same. Therefore, Molina's appeal from the probate order (case No. RIP1501250) is moot and we dismiss it. (See Wilde v. City of Dunsmuir (2018) 29 Cal.App.5th 158, 166 [appeal is moot when decision of reviewing court can have no practical impact or provide effectual relief].)
III.
DISPOSITION
The ruling on submitted matters filed January 12, 2018, in case No. RID1103927 is affirmed. The appeal from the January 12 ruling, in case No. RIP1501250, is dismissed as moot. Objector, petitioner and respondent Zilpa Mendez shall recover her costs on appeal. (Cal. Rules of Court, rule 8.278(a)(2).)
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
McKINSTER
Acting P. J. We concur: SLOUGH
J. MENETREZ
J.