Marriage of Gunn

Filed 6/11/10 Marriage of Gunn CA1/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION THREE

This is an appeal from the judgment in a marital dissolution matter resolving all issues related to, among other things, child visitation and custody, child support, spousal support, attorneys fees and sanctions. Appellant William F. Gunn (husband), representing himself, seeks reversal of the judgment on the grounds that the trial court erroneously calculated his income and relied upon hearsay evidence in awarding respondent Lisa R. Gunn (wife) $1,474 per month in child support and $500 per month in permanent spousal support. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

Husband, age 66, and wife, age 44, separated in June of 2004 after 16 years and four months of marriage. At the time of trial, they had three minor children, born in 1991, 1993, and 1996, respectively.

During the marriage, husband and wife generally enjoyed an upper to middle class standard of living, with husband earning at times as much as $150,000 to $155,000 per year. Over the years, however, husbands income has fluctuated, and he has been employed as, among other things, a real estate agent and a fragrance model. Wife provided full-time care for the children during the marriage and, since separation, has been employed as a kitchen manager at a nearby high school, a waitress at a local restaurant, and at Target, for a total of about 60 hours per week.

A judgment of dissolution was entered on October 31, 2008. In addition, a three-day trial was held on October 30, 2008, December 19, 2008, and December 26, 2008, with respect to the issues of child custody, visitation and support; spousal support; attorneys fees and sanctions. At trial, wife was represented by counsel and husband represented himself. Much of trial consisted of trying to piece together husbands real income amidst allegations by wife that he was, among other things, hiding income and other assets and overstating expenses. Further complicating the matter, husband, who was then self-employed as a real estate agent and suffering the effects of a down housing market, filed for bankruptcy in 2008 (which he had also done in 1987 and 1992).

On December 26, 2008, after hearing testimony and receiving exhibits from husband and wife (among others), the trial court stated its decision on the record. In particular, the trial court expressed concern regarding the difficulty it had reconciling the numbers contained in husbands various exhibits, including his profit and loss statements, tax returns, and income and expense declarations. Ultimately, the trial court found many of those numbers, particularly with respect to husbands expenses, were simply not reliable. The trial court also found that husband had played fast and loose with his Social Security benefits, initially hiding them from wife.

Thereafter, on February 25, 2009, the trial court entered a final judgment with respect to child custody, visitation and support; permanent spousal support; attorneys fees and sanctions. Pursuant to this judgment, the trial court ordered husband to pay $1,474 per month in child support, less a $387 per child credit for Social Security derivative benefits, and $500 per month in permanent spousal support. In addition, the trial court made permanent its interim orders with respect to child custody and visitation. Finally, after finding that husband had unnecessarily prolonged the litigation and misrepresented his income, the trial court ordered him to pay wife $1,050 in sanctions within four months, and to pay her $5,000 beginning in six months at a rate of $250 per month, to cover attorneys fees. This appeal followed.

DISCUSSION

Husband seeks reversal of the judgment on the grounds that the trial court relied upon erroneous information regarding his income in awarding child support and permanent spousal support, and relied upon inadmissible hearsay evidence in questioning his credibility. We address each contention below.

I. Calculation of Husbands Income.

Husband contends the trial court made two errors when calculating his income for purposes of awarding child support and permanent spousal support. Specifically, husband contends the trial court erred by (1) double counting his Social Security benefits, and (2) assuming without record support that he earned between $150,000 and $155,000 per year. The following facts are relevant to these inquiries.

A. Husbands Social Security Benefits.

As set forth above, the judgment requires husband to pay $1,474 per month in child support for the three minor children (minus a credit for social security derivative benefits), and $500 per month in permanent spousal support. In reaching this judgment, the trial court relied upon Dissomaster reports prepared by the court and by the parties, which identified $4,779 as husbands monthly net income from self-employment, and $1,238 as additional monthly income he receives in Social Security benefits. On appeal, husband contends these awards are erroneous because [a]ctually, the $1,238 amount is part of the $4,779 amount and thus is counted twice.

We review a trial courts award of child support or spousal support for abuse of discretion. (County of Orange v. Smith (2005) 132 Cal.App.4th 1434, 1445.) In doing so, we keep in mind that the trial courts   discretion must be exercised along legal lines, taking into consideration the circumstances of the parties, their necessities and the financial ability of the [supporting spouse.]  [Citation.].) (In re Marriage of Rosen (2002) 105 Cal.App.4th 808, 825.) Relevant here, the former and current statutory guidelines governing the determination of spousal and child support authorize the trial court . . . to consider the earning capacity as well as the actual income of the supporting spouse in determining support, but they do not specify or limit the circumstances under which the trial court may look to earning capacity in addition to, or in place of, actual income in fixing support. (In re Marriage of Simpson (1992) 4 Cal.4th 225, 232. See also Fam. Code,  4330.)

Where a party challenges the trial courts factual findings underlying an award of child support or spousal support, our review is limited to a determination of whether substantial evidence exists in support of such findings. (In re Marriage of Drake (1997) 53 Cal.App.4th 1139, 1151; In re Marriage of Rosen, supra, 105 Cal.App.4th at p. 826.) On review for substantial evidence, we examine the evidence in the light most favorable to the prevailing party and give that party the benefit of every reasonable inference. (In re Marriage of Catalano (1988) 204 Cal.App.3d 543, 548.) We accept all evidence favorable to the prevailing party as true and discard contrary evidence. (Ibid.) (In re Marriage of Drake, supra, 53 Cal.App.4th at p. 1151.)

Here, in awarding child support and permanent spousal support for wife, the trial court explained its reasoning on the record. In particular, after expressing concern that husband had not been forthright in his financial dealings, the trial court noted that the question remains what is his income and how much more, if any, should [the court] impute to him. The trial court then decided the best evidence . . . is . . . his filing from bankruptcy court where he said on July 9, 2008 that his income was $4,779 a month. Im going to use that figure as the best, most accurate estimate of his real earnings. Whether hes misleading the bankruptcy court remains a question in my mind, but it seems the best and most reliable figure we have. And, in addition, of course he receives $1,238 a month from social security retirement benefits.

The trial court, inputting these monthly income numbers into the Dissomaster report, thus ordered husband to pay $1,474 per month in child support, and $500 per month in permanent spousal support. In doing so, the trial court declined wifes request to impute to husband $7,500 in monthly income from self-employment, plus $1,238 monthly from Social Security, acknowledging that husbands income level had dropped in recent years. Nonetheless, the trial court left open the possibility of increasing the support awards to an amount more in line with the marital standard of living should husbands income level rebound in the future.

The record supports the trial courts reasoning and decision. In particular, the record reflects that, in connection with Chapter 7 bankruptcy proceedings, husband filed a Statement of Current Monthly Income and Means in federal court on July 9, 2008, identifying $4,779.84 as the amount of monthly income he received from the operation of a business, profession or farm. In addition, Schedule I of the same filing identified $4,779 as husbands net monthly take home pay from operation of a business, profession or farm, and, in addition, $1,238 as his monthly Social Security benefit. These documents were signed by husband under penalty of perjury.

As he did below, husband insists these federal court documents, signed under penalty of perjury on July 9, 2008, contain erroneous information, in that they entered my social security benefits twice in the figures. Husband further claims to have filed an amended document in federal court on November 12, 2008, to report the errors. However, the record suggests the trial court did not find the amended document, or husbands testimony on this issue, reliable. Given that the trial court, unlike this court, had the benefit of personally observing husbands demeanor and hearing his testimony, we will defer to the trial courts superior judgment on this issue. (In re Marriage of Smith (1990) 225 Cal.App.3d 469, 494 [[r]eading a typed reporters transcript does not enable us to view the witnesses, determine credibility or determine which conflicting evidence is to be given greater weight].) We simply note in support of the trial courts judgment that, although husband testified that the amended document was [b]asically . . . submitted to the bankruptcy court, the amended document is dated November 12, 2008, several months after the original document was filed, and contains no stamp or other indication of having been filed in federal court.

Thus, based on this record, we conclude the purported erroneous calculation of husbands monthly net income does not require reversal of the judgment.

B. Husbands Annual Earnings.

In a related argument, husband challenges the awards for child support and permanent spousal support on the ground that they were infused with an unsubstantiated finding by the trial court that  [he] was earning very substantial sums of money, from $150,000 to $155,000 a year.  According to husband, the trial court made comments about [his] actual earnings [that] seem to have been comments about historical earnings. In particular, husband argues, [b]ased on its reference to Husbands having purportedly recently earned up to $155,000 a year from time to time . . . , the court in essence found that at age 66 Husband is capable of working very, very hard and earning a significant sum of money. . . . This is an inappropriate analysis in the effort to fashion an award of permanent spousal support against a man of that age. We reject this reasoning.

As the record discussed in detail above demonstrates, the trial courts awards of $1,474 per month in child support and $500 per month in permanent spousal support were not based on husband having an annual income of $150,000 to $155,000. Rather, the awards were based on documents husband filed under penalty of perjury in federal bankruptcy proceedings, which identified $4,779 as his monthly income from self-employment and $1,238 as his monthly Social Security benefit.

Husbands contrary argument appears to be based upon an observation made by the trial court just before reaching the judgment that there were times in [husbands] life not that long ago when he was earning very substantial sums of money, from $150,000 to $155,000 a year. However, husband ignores that the trial court immediately thereafter noted that, [s]imultaneously, theres no question except that [husband] filed for bankruptcy last year, and the question is how to reconcile all of this. The trial court then referred back to husbands net monthly income, as identified in his federal court papers, as the best evidence of his current earning capacity.

The trial courts comments, considered collectively, demonstrate that it relied upon appropriate factors to calculate the child support and permanent spousal support payments to wit, actual evidence in the record of husbands recent monthly net income. (In re Marriage of Simpson, supra, 4 Cal.4th at p. 232 [trial court may look to earning capacity and/or actual income in fixing support].) As such, husband has again provided no basis for reversing the judgment.

II. Hearsay Evidence.

Finally, husband challenges the judgment on the ground that the trial court relied upon inadmissible hearsay evidence relating to a previous lawsuit between him and his former counsel to discount his credibility. The following facts are relevant.

During trial, wifes attorney requested that the trial court take judicial notice of certain documents relating to husbands bankruptcy proceedings, some of which also related to the aforementioned previous lawsuit between husband and his former attorney. Husband objected on hearsay grounds to taking judicial notice of one of these documents a case management statement submitted by his former attorney in the previous lawsuit. However, husband has pointed to no place in the record, and we have found none, indicating that the trial court actually ruled on his objection. Subsequently, when providing its statement of decision, the trial court noted it was asked to take judicial notice of [the former attorneys] case management statement February 9, 2007, in which he said [husband], quote, wrote bad checks to attorneys and to others. He continued lying in an effort to have the attorneys continue working for him, and his promises of payment out of an escrow that was in the process of closing were also untrue, closed quote. The trial court then noted that [husband] has also testified that he sought to provide money to his creditors. Hes not been forthright in his financial dealings.

We review a trial courts evidentiary rulings under an abuse of discretion standard. (People v. Waidla (2000) 22 Cal.4th 690, 717.) Under this standard, a trial courts evidentiary ruling will be affirmed on appeal unless there is a clear showing of an abuse of discretion. (Smith v. Brown-Forman Distillers Corp. (1987) 196 Cal.App.3d 503, 519-520.)

Husband correctly argues that hearsay evidence is inadmissible at trial, including marital dissolution trials, subject to specific statutory exceptions, unless the parties stipulate to the admission of the evidence or fail to enter a hearsay objection. (Evid. Code, 1200; Elkins v. Superior Court (2007) 41 Cal.4th 1337, 1354.) However, even where hearsay evidence is erroneously admitted or otherwise relied upon for the truth of the matter asserted, such error requires reversal of the final judgment only if the challenging party establishes that a miscarriage of justice has resulted. (Cal. Const., art. VI, 13; Evid. Code, 353.)

In this case, husband objected on hearsay grounds to taking judicial notice of the case management statement from the unrelated lawsuit involving him and his former attorney. However, husband thereafter failed to secure a ruling from the trial court on his objection. (See People v. Millwee (1998) 18 Cal.4th 96, 126 [review cannot occur in the absence of an actual evidentiary ruling].) Moreover, in any event, assuming the trial court improperly relied upon the challenged document, a thorough examination of the record does not show that a miscarriage of justice resulted, or that remand based on the trial courts actions would result in a more favorable outcome for husband. In particular, as we have already explained, the trial court made detailed findings of fact and conclusions of law in reaching the judgment. These findings of facts and conclusions of law reflect that the trial court, quite simply, found husbands testimony and exhibits unreliable. Indeed, the trial court ultimately sanctioned husband for, among other things, misrepresent[ing] his income to the court, a decision husband has not challenged on appeal. Thus, putting aside the appropriateness of judicially noticing the challenged document, there was plenty of evidence in the record to support the trial courts credibility determinations, some of which we have already discussed (such as the amended documents husband claimed to have filed in federal court).[1] Under these circumstances, we conclude reversal of the judgment on hearsay grounds is unnecessary. (Cal. Const., art. VI, 13; Evid. Code, 353; Malibu Mountains Recreation, Inc. v. County of Los Angeles (1998) 67 Cal.App.4th 359, 372.)

DISPOSITION

The judgment is affirmed. Costs on appeal are awarded to wife.

_________________________

Jenkins, J.

We concur:

_________________________

Pollak, Acting P. J.

_________________________

Siggins, J.

Publication courtesy of California pro bono lawyer directory.

Analysis and review provided by Chula Vista Property line attorney.

San Diego Case Information provided by www.fearnotlaw.com

[1] There was also evidence, referred to in the trial courts statement of decision, that husband had submitted unreliable tax documents purporting to amend previously filed tax documents, and documents relating to his business expenses containing unsubstantiated and inflated numbers (including an alleged 40,000 miles-per-year, driving-related business expense, which husband later retracted). Finally, there was evidence in the form of wifes testimony that husband initially hid the fact that he was receiving certain Social Security benefits on behalf of his children. The trial court had discretion to accept this evidence, which, regardless of the alleged hearsay document, supports its ultimate conclusion that husband was not credible. (In re Marriage of Drake, supra, 53 Cal.App.4th at p. 1151.)