Issue: can past due support be waived where party agrees to pay only fraction of what is owed and there is no bona fide dispute as to amount due? Held: No

Parties divorced in 1990's. In a post-divorce proceeding, court ordered child support, alimony, health insurance coverage plus half of all the child's uninsured medicals. Father moved to Japan and did not pay. Mother hired a collection agency in Japan. In 2003, Husband offers settlement agreement for $100,000 (1/3 of amount due) plus waiver of future support. Father failed to pay the $100,000 within 30 days as required by the agreement- mother did not receive payment for 18 months. Recently, CSSD (California Child Support Services) filed a motion to determine whether father owned back support payments for the remaining $200,000+.

Father argued that all issues had been resolved under the 2003 agreement between the parties. Wife claims that she signed the agreement only because she was desperate and under duress (child had been abducted by a pedophile and mother needed money to send her to therapy) and that agreement was void as father failed to pay within 30 days as agreed.

Trial court found that the agreement was too vague, ambiguous and unclear.

HELD: Family Code, section 3651(c)(1) states that a support order cannot be modified or terminated as to support that was past due before the date the motion or OSC to modify or terminate was filed. This applies even if the order was based on an agreement between the parties. It also applies to accrued interest. Further, an accord and satisfaction requires a bona fide dispute concerning the amount of debt owed. Here there was none.

As to the waiver of future support, wife argues that the waiver is ineffective because the money was not paid within 30 days. Absent a statement of decision, an appellate court will presume the trial court found every fact necessary to support its decision. Here, substantial evidence supports the implied findings of the trial court. Since the payment within 30 days was a material term, the entire agreement is void.

Case: Sabine M. v. Toshio M.
Court: Los Angeles County Superior Court
Judge: Commr. Dennis Carroll

Labels: CSSD, divorce, past alimony, past child support

During discovery in a divorce action, husband failed to disclose all separate and community assets held by him. Wife filed an application for monetary sactions against husband for violating his fiduciary duty to make financial disclosures to wife during divorce proceedings as well as attorneys fees based on Family Code, section 1101(g), section 2107(c) and 271(a). Collectively, these family code sections give the trial court power to sanction and impose attorneys fees for breach of spouse's fiduciary duty to disclose and for conduct which frustrates the policy of promoting settlement. Trial court ordered husband to pay $250,000 to wife as sanctions, in addition to $140,000 for wife's attorneys fees. Trial court found that husband intentionally sought to circumvent the disclose process and that his conduct frustrated the policy of promoting settlement. Husband appeals. Held: sanctions and attorneys fees properly imposed.

Family Code, section 721 declares that spouses must make full disclosure of all material facts and information regarding the existence, characterization, and valuation of all assets and provide equal access to information. This duty persists until each asset has been divided by the trial court. Section 2100(c) mandates full disclosure of all assets and liabilities of each party in the early stages of a divorce proceeding, regardless of whether party believes them to be community or separate property. The information must also be updated should changes occur. Parties are required to exchange a preliminary and final declaration of disclosure (Fam. Code, 2103)

In order to deter repeated non-disclosure, Family Code, section 2107(c) requires the trial court to sanction a party and award reasonable attorneys fees for failure to comply with disclosure obligations unless the failure is justified or sanctions would be unjust. Attorneys fees can also be awarded under section 271 if the party's conduct has frustrated the policy of promoting settlement.

The appellate court held that no harm must be shown by wife in order to be awarded sanctions; the purpose of sanctions is to force compliance with the disclosure laws and promote settlement. The Court further finds that imposition of sanctions does not first require wife to ask for husband again for the information or bring a motion to compel.

Case: Marriage of Feldman
Court: San Diego County

Labels: community property, divorce, financial disclosures, hiding assets

Dad is the defendant in a pending capital murder case. The jury found him guilty and recommended the death penalty; sentencing has not taken place.

At the time of the killings, father was subject to a child support order for his daughter who was born in 1988. After his arrest, he liquidated his assets to hire a criminal defense attorney who took most of the money as a retainer. Since he had stopped paying child support, DCSS (Department of Child Support Services) filed a motion to modify the support order in light of father's incarceration. The family law court modified the child support order basing the amount on the amount of interest that could have been earned on the proceeds of the liquidated assets, rather than on dad's income. It also ordered that the current amount due be paid from the criminal attorney's client trust account, as well as a security deposit to DCSS for future monthly payments for the two years before child reached majority.

Father argues on appeal that the amount ordered was too high or, in the alternative, that it violated his constitutional right to a criminal defense lawyer of his choice by diminishing the amount available for a retainer.

The Appellate Court found that the Constitution does not insulate a criminal defendant from third-party claims just because it would reduce his ability to afford his retained counsel; he is only entitled to choose counsel he can afford. Further, interest income is a proper source of child support under Family Code, section 4058, and the court can impute income under certain circumstances. Family Code, section 4012 allows a court to require a security deposit for future payments upon the showing of good cause; here, good cause existed because father was attempting to use all his money on his criminal defense.

Case: Brothers v. Kern

Labels: child support, DCSS, incarceration, jail

The Sixth District of the California Court of Appeal recently issued this unpublished opinion regarding modification of child support.

Following the divorce of husband and wife, husband was ordered to pay $1200 per month in child support for the couple's two children. At the modification hearing on wife's subsequent OSC for $5,000 per month, wife testified that she was not employed, a change from her previous circumstance of part-time employment with imputed income of $1760. Husband testified that he now earned $6000 per month, had $40,000 from an inheritance and some money left from his $150,000 share of the value of the family home. Husband also argued that wife was not disclosing all of her assets.

The trial court found no change in circumstances regarding imputed income for the wife, but did increase the income attributable to husband. The court increased the child support order to just under $1500 per month and found that the wife had not fully disclosed her income and assets.

Wife appealed the order as it was far less than the $5000 she requested. The Appellate Court upheld the lower court ruling, declaring that a parent seeking a modification of a support order must show evidence of a change in circumstances and wife had not met this burden.

Case: Winter v. Dokonal
Court: Santa Clara County
NOT PUBLISHED

Labels: change of circumstances, child support, divorce, imputed income

In this unpublished opinion from the Fourth District California Court of Appeal, the court discusses income for support orders imputed from earning capacity and a subsequent spouse.

Husband and wife divorced in 2003 and had two young children. At the time, husband was a BMW car salesman and earned around $6000 per month. Wife had a home-based salon and earned $400 per month. Husband was ordered to pay $1200 in child support and $900 in spousal support (alimony) per month. Wife was awarded the family residence and paid the husband an equalizing payment of half the value of the then-value of the house.

In early 2005, husband got remarried and moved with the new wife to Italy for her job with the military. The new wife had 3 children of her own.

In May 2005, the trial court held a hearing on husband's order to show cause (OSC) for modification of the support orders. Wife failed to serve husband with an income and expense declaration prior to the hearing; her attorney presented it to the court on the day of the hearing in addition to two recent pay stubs. As husband was appearing telephonically from Italy, he was not able to examine the evidence.

Husband stated that he was looking for work in Italy but was still unemployed. The trial judge imputed to husband his new wife's monthly income of $5,800. As the guideline amounts did not change substantially from the prior amounts, the court refused to modify the support orders.

In November 2005, husband filed a motion to modify the support, set aside the May order and correct the arrears award made by the court at the May hearing. Husband argued that wife had failed to disclose that she had made a profit on the sale of the family home. He also filed an updated income and expense declaration that showed a part-time job making $900 per month. His new wife's income had increased to $9000 per month, but family expenses ran upwards of $8,500 per month.

Husband argued that since he never received proper service of wife's evidence, the arrears order should be vacated. The lower court found that although the arrears award exceed the amount wife had requested in her OSC application, it should not be vacated but rather reduced to the requested amount. California Code of Civil Procedure, section 473(d) allows for setting aside a void judgment or order. The court found that the judge had jurisdiction to make the order, therefore it was never void. The Appellate court agreed, finding that husband received notice of the proceeding and was given an opportunity to be heard. However, the court also found that it may have been improper (erroneous) for the court to rely on an income and expense declaration and pay stubs that husband had not seen. However, the method for correcting an erroneous order is to move for reconsideration or to appeal it.

In regard to the support orders, the lower court found that wife now made $2,340 per month. The court also imputed California minimum wage to husband of $1,170, as well as one-half of his new wife's income. The court reduced the child support to $1000 per month. In upholding the imputation of the minimum wage, the Appellate court declares that a court can depart from the guideline only in special circumstances set forth in the statutes. The court found no abuse of discretion in considering husband's earning capacity in lieu of his income (Family Code, section 4058(b). ) Pursuant to Marriage of Regnery, earning capacity is measured by 1.) ability to work; 2.) willingness to work; and 3.) opportunity to work. Section 4058 expressly authorizes the court to attribute income, without regard why the income has been reduced. The Appellate court found that husband's move to Italy does not alter the fact that he has a continuing obligation to his children and that he could presumably find full-time, rather than part-time, employment.

The Appellate Court did find, however, that the trial court erred in considering half of the new wife's salary in the guideline calculation. California Family Code, section 4057.5 expressly prohibits courts from considering a subsequent spouse or partner's income except in an extraordinary case where excluding it would lead to extreme and severe hardship to the child subject to the award, in which the case the court must also consider whether it would lead to extreme and severe hardship to any other supported child. As wife did not produce a current income and expense declaration from which the court could determine severe and extreme hardship, there was insufficient evidence to determine whether excluding the subsequent wife's income would cause the children to suffer extreme and severe hardship as wife received a significant gain on the sale of the family residence and was earning less than what she was capable of.

Case: Marriage of Gaffney
Court: San Diego County Superior Court
Judge: Lantz Lewis
UNPUBLISHED

Labels: alimony, child support, Family Code 4058, imputed income, spousal support, subsequent spouse

In this unpublished Second Appellate District opinion, the Court finds for appellant/defendant law firm and determines that its special motion to strike (anti-SLAPP) pursuant to Code of Civil Procedure, section 425.16 should have been granted.

In a divorce action, wife hired the defendant law firm to represent her in Los Angeles Superior Court. Wife revealed to her attorneys that, although it rightfully belonged to her and husband, the family home was actually held in the name of husband's parents and provided evidence in support of her contention. Her attorneys then filed a constructive trust action against husband's parents and joined them in the dissolution action so that wife could gain control of the community property family home. Although the parents' attorney insisted that the property rightfully belonged to parents, wife's attorneys continued with the constructive trust action through wife's deposition and exchange of documents. Upon review of the documents provided by parents, wife's attorneys promptly dismissed the action against the parents.

The parents subsequently sued wife's attorneys for malicious prosecution. The attorneys, the Gould-Saltman Law Offices, filed an special motion to strike (anti-SLAPP) the Complaint, which was denied in the trial court, arguing that the parents would not be able to prevail on their malicious prosecution claim.

The Court of Appeal finds that the parents failed to show that there was no probable cause to bring the constructive trust action and failed to show the existence of malice on the part of the attorneys. First, for probable cause, the parents had to show that there was no probable cause to bring the action or that the attorneys continued to prosecute the case after they discovered that there was no probable cause. The Court finds that the attorneys' reliance on their client's statements (wife) was enough for a findng of probable cause and that the complaint was dismissed in a sufficient amount of time upon discovering that the action lacked merit. The Court also failed to find malice in the aforementioned conduct.

Of note, however, is the Court's determination that this constructive trust joinder action against a spouse's parents does not amount to a family law motion or OSC, which would be protected from a subsequent malicious prosecution claim under Bidna v. Rosen (1993) 19 Cal.App.4th 27.

Case: Budilo v. Gould-Saltman Law Offices
Court: Los Angeles
Judge: Stern

UNPUBLISHED OPINION / DO NOT CITE

Labels: anti-slapp, community property, constructive trust, dissolution, divorce, joinder, malicious prosecution

In this unpublished opinion by the Second District California Court of Appeal, the court affirms an order awarding temporary child and spousal support (alimony) and attorneys fees made by the Los Angeles Superior Court in a divorce case.

In August 2001, husband filed for legal separation and wife filed a response. In March 2004, wife filed an amended response requesting a divorce rather than a separation. The parties disagreed as to the date of their physical separation.

In June 2005, wife filed an order to show cause (OSC) requesting guideline alimony and an attorneys fees award for $5000. She stated that the parties had reconciled in June 2002 and finally separated in October 2003 due to domestic violence. She also stated that husband used community funds to put a down-payment on the family home in which he now lived. She also stated that husband had cut her and their three children off financially. She received public assistance until the court ordred husband to pay $1300 a month back in September 2004.

In July 2005, husband filed an order to show cause (OSC) requesting modification of child support and seeking to have income of $30,000 per year imputed to wife based on a vocational assessment. Child Support Services Department (DCSS) opposed this request.

Husband listed his monthly salary at $4800 and stated that he had a mortgage, car payment and various credit card debts. He stated that he could not afford to pay alimony or attorney fees. He further claimed that he purchased the home with the parties were separated.

In August 2005, the trial court declined to impute additional income to wife above her stated $658 per month, finding that she had used reasonable efforts to become better employed. The court ordered husband to pay guideline support of $1,772 for the three children and $200 per month in alimony. The court based this spousal support order on a variety of factors including that the parties had been married for 10 years, had been middle-class, that husband lives in the family home, and that he was found guilty of spousal abuse. The court futher ordered husband to pay $5000 for wife's legal fees as he had the greater ability to pay and had control of the community property asset.

The appellate court upheld the low court ruling, finding that there were no discretionary factors present under which the court could deviate from the guideline child support amount pursuant to Family Code, section 4055. As to alimony, the Appellate court found no error as wife had no ability to maintain the marital lifestyle, was a victim of husband's domestic violence, and husband was sitting on the major asset (house). As to attorneys fees, husband presented no evidence that he was unable to borrow the money to pay the award.

Case: Washington v. Washington
Court: Los Angeles
Judge: Frederick Shaller
NOT PUBLISHED

Labels: attorneys fees award, divorce, temporary support