Marriage of Davoudi



Filed 1/18/11 Marriage of Davoudi CA2/7






NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS


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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SEVEN

In re Marriage of JANET and VAHIK DAVOUDI.	B221022 (Los Angeles County Super. Ct. No. ED015980)
JANET DAVOUDI, Appellant, v. VAHIK DAVOUDI, Respondent.

APPEAL from an order of the Superior Court of Los Angeles County, William D. Stewart, Judge. Reversed and remanded.
Linda T. Barney for Appellant.
Honey Kessler Amado for Respondent.
_______________________________

Janet Davoudi appeals from an order denying her motion for determination of support arrearages, contending the family law court erred in concluding the provisions in the parties’ 1997 judgment of dissolution awarding additional family support based upon a percentage of her former husband’s excess earnings was void. Vahik Davoudi argues the order—sometimes known to the family law bench and bar as an Ostler-Smith order^[1]—was superseded by two subsequent orders modifying his family support obligation and, in any event, although valid when made, was unenforceable by the time Janet^[2] sought to assess arrearages. We agree the Ostler-Smith order was superseded by the subsequent support orders, but remand for the family law court to determine whether any unpaid support had accrued prior to the initial support modification order.
FACTUAL AND PROCEDURAL BACKGROUND
Janet and Vahik were married in March 1984 and separated in February 1996. They have two children, who were age nine and five at the time of separation.
A judgment of dissolution was entered on July 15, 1997. The judgment provided for joint legal custody of the two children, with primary physical custody awarded to Janet. The court entered a family support order utilizing a base salary for Vahik of $5,042 per month and imputing income of $1,286 per month to Janet starting June 1, 1997. Vahik was ordered to pay $2,200 per month for the period from November 30, 1996 to May 31, 1997, and thereafter $1,800 per month, plus 40 percent of the amount his monthly earnings exceeded $5,042 as a result of overtime or other compensation.^[3] Support was to continue until the death of either party, Janet’s remarriage or further order of the court and was payable by earnings assignment, including the percentage due Janet for amounts earned in excess of Vahik’s base salary.
On August 5, 1998 Janet filed an application for an order to show cause to modify child and spousal support. In her declaration in support of the application, Janet stated Vahik’s income “has risen considerably within the last two years [since separation]. . . . [His] change of income and his ability to pay should be considered as a change of circumstance.” Janet asked the court to modify the existing support order and expressly requested the “guideline” amount. Vahik’s income and expense declaration filed on October 1, 1998 indicated his monthly income had, in fact increased, but only modestly. On October 14, 1998, after finding Janet’s earning capacity had not changed, the court ordered Vahik to pay “family support in the amount of $1,950 beginning October 1, 1998 and until further order of the court.” A new wage and earnings assignment order was filed on October 26, 1998, stating, “This order modifies an existing order,” and directing Vahik’s employer to deduct $1,950 per month from his earnings for current family support.^[4]
On May 22, 2007 Vahik filed an application for an order to show cause to modify support, seeking termination of spousal support and a reduction in child support.^[5] In his supporting papers Vahik stated his monthly income was $10,504. He argued Janet had been working in real estate and banking and was capable of supporting herself. In response Janet requested “[t]he current family support of $1,950.00 to remain in full force and effect.” Janet’s declaration explained, “Respondent [Vahik] and I entered into an oral agreement in January, 2005, which has been partially performed. [¶] The agreement provided that I would purchase an auto for Eric [their older son], which I did on January 16, 2005, and, in exchange, Respondent would continue paying me the current support amount of $1,950.00 per month, until the car was paid off at the end of December, 2009.”
On June 13, 2007, the date scheduled for hearing on Vahik’s requests for modification, Vahik and Janet settled the issues raised by Vahik’s application for an order to show cause and entered into a stipulation and proposed order, agreeing to modify Vahik’s family support obligation to $1,600 per month beginning July 15, 2007 and continuing through December 2007, and then $1,200 per month beginning January 1, 2008 until October 18, 2008 (their younger son’s 18th birthday), at which time all support would terminate. Vahik also agreed to pay off the loan on his older son’s car. The court signed and filed the order on the same date.
On February 4, 2009 Janet filed an application for an order to show cause to determine arrearages in past family support payments, seeking 40 percent of all amounts earned by Vahik from 1997 through 2008 in excess of $5,042.^[6] Janet ultimately claimed arrearages totaling $226,358.79, plus interest. Vahik opposed the request, arguing the 1997 Ostler-Smith order was void and unenforceable as a matter of law because the court had failed to enter findings to support the order as required by Family Code section 4056, subdivision (a); and, in any event, the 1997 order for payment of additional family support based upon a percentage of monthly earnings above $5,042 had been superseded by the October 1998 modified support order requiring payment of a higher, fixed amount of support. In his opposition papers Vahik also noted that Janet had never previously complained about his failure to make support payments based on the 40 percent formula although she had had several opportunities to do so.
An evidentiary hearing was held on July 7, 2009. The court then continued the matter for further briefing on the issue whether the Ostler-Smith order, which would generate a child support order greater than the statutory guideline support, was enforceable in the absence of findings required by Family Code section 4056. At a further hearing on the issue the court concluded the order or judgment was “invalid from the inception”: “The original order did not comply with the statutory requirements of setting forth the basis of the departure [from the guideline], specifically the basis for determining 40 percent. There seems to be no rationale for that. I mean, why not 2 percent or 98 percent or—it looks like it was just plucked out of the air. So the court can’t find any rational basis for that particular order.” In an order after hearing filed October 9, 2009 the court reiterated it had denied the motion for determination of arrearage of family support “as a matter of law. The court found the amount of excess payment ordered by the court to be arbitrary and not on rational basis, and thereby unenforceable.”^[7]
DISCUSSION
1. The Family Law Court Erred in Concluding the 1997 Support Order Was Unenforceable as a Matter of Law
Vahik, represented by new counsel on appeal, concedes the 1997 family support order, including the Ostler-Smith provision requiring him to pay additional support equal to 40 percent of any earnings over his base monthly income of $5,042, was apparently valid when made: “[T]he law as it existed in 1997, when the Judgment at bar was entered, allowed for a percentage of bonuses to be awarded as spousal support and child support.” (See In re Marriage of Ostler & Smith (1990) 223 Cal.App.3d 33, 41-42 [because bonuses are not guaranteed, it is fairer to all parties “to base the support order on Husband’s income from salary . . . , and to allocate a portion of the future bonus income to the children and to Wife by way of a percentage interest”].) Indeed, even today awarding a fraction or percentage of a bonus as spousal or child support “over and above guideline support” is an appropriate method for including discretionary bonuses actually received in the annual gross income of the supporting spouse for the purpose of determining spousal and child support obligations. (See Fam. Code, § 4064 [“[t]he court may adjust the child support order as appropriate to accommodate seasonal or fluctuating income of either parent”]; In re Marriage of Mosley (2008) 165 Cal.App.4th 1375, 1387 [discretionary year-end bonus]; see also In re Marriage of Kerr (1999) 77 Cal.App.4th 87, 94 [income from exercise of future stock options].)
However, to comply with federal law Family Code section 4056, subdivision (a), the family law court must “state, in writing or on the record, the following information whenever the court is ordering an amount for [child] support that differs from the statewide uniform guideline formula amount under this article: [¶] (1) The amount of support that would have been ordered under the guideline formula. [¶] (2) The reasons the amount of support ordered differs from the guideline formula amount. [¶] (3) The reasons the amount of support ordered is consistent with the best interests of the children.” (See In re Marriage of Fini (1994) 26 Cal.App.4th 1033, 1040 [“federal law requir[es] each state to adopt child support guidelines which create a rebuttable presumption that the amount established by the guideline is correct, although the presumption can be rebutted and a different amount ordered if there is a finding in writing or on the record that the application of the guidelines would be unjust or inappropriate”]; see also Rojas v. Mitchell (1996) 50 Cal.App.4th 1445, 1449 [“Effective January 1, 1994, the Legislature adopted the Statewide Uniform Guideline for child support. [Citation] There is a rebuttable presumption that the child support established by the guideline is the correct amount to be ordered.”].)
As the court explained in In re Marriage of Hall (2000) 81 Cal.App.4th 313, 317-318, in applying the statutory formula set forth in Family Code section 4055 to determine guideline child support, “the formula does not admit one parent’s income to be a fluctuating variable while the other parent’s income is assumed to be static. The formula is always predicated on knowing what both parents’ income is in nominal static dollars at the time the order is made.” To be sure, as the court noted in In re Marriage of Hall, the family law court has discretion to make an order for child support that accounts for the fluctuating income of one parent, “[b]ut such an order cannot be called the ‘guideline’ amount pursuant to section 4055.” (Id. at p. 318, fn. 3; see id. at p. 318 [“the order made by the trial judge here, in which the order fluctuates as a percentage of only one parent’s income, is a result that differs from the formula guideline on its face”].) Accordingly, to be valid, a child support or family support order^[8] that includes such a provision, as here, must comply with the requirement of Family Code section 4056 that any deviation from the formula amount be justified either in writing or on the record.
Given the facial noncompliance of the judgment before it with Family Code sections 4055 and 4056, the court in In re Marriage of Hall, supra, 81 Cal.App.4th at page 318, held “the judgment must be reversed and remanded for further proceedings in conformity with those statutes.” (See Rojas v. Mitchell, supra, 50 Cal.App.4th at p. 1451 [reversible error to fail to give reasons for support order that differed from guideline amount “since the missing reasons cannot be implied in the court’s express findings and we cannot conclude that the missing information would necessarily have been adverse to appellant”].) In her opening brief Janet seeks to avoid the implication of these cases by arguing, as she did before the family law court, that the bench officer who ordered family support in 1997 provided a sufficient (albeit limited) explanation for departing from the statutory formula in his statement of decision, although not in the final judgment that was entered. She also suggests, because the amount ordered exceeded the uniform guideline amount, any error in the award was harmless (although the sole authority she cites for this proposition is In re Marriage of Laudeman (2001) 92 Cal.App.4th 1009, 1014, a case that involved a stipulated order for child support in which the court of appeal held “the record is sufficient to show that, had the omission been called to the court’s attention, the statements [required by Family code section 4056] would have been made”.
We need not resolve either question. Even assuming the 1997 order was invalid either when made or in light of subsequent case law developments, it is at most voidable, not void, and is not properly challenged 12 years after it was entered simply because the necessary findings were not made pursuant to Family Code section 4056. (See Fam. Code, § 3691 [setting forth grounds and applicable time limits for an action or motion to set aside a support order]; see also Fam. Code, § 2122 [setting forth grounds and applicable time limits for a motion to set aside a judgment in family law proceedings].)^[9]
Lack of jurisdiction in the “most fundamental or strict sense means an entire absence of power to hear or determine the case, an absence of authority over the subject matter or the parties.” (Abelleira v. District Court of Appeal (1941) 17 Cal.2d 280, 288; accord, People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653, 660 (American Contractors).) “When a court lacks jurisdiction in a fundamental sense, an ensuing judgment is void, and ‘thus vulnerable to direct or collateral attack at any time.’” (American Contractors, at p. 660; see Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180, 196 [“in the absence of subject matter jurisdiction, a trial court has no power ‘to hear or determine [the] case.’ [Citation.] And any judgment or order rendered by a court lacking subject matter jurisdiction is ‘void on its face . . . .’”].)
“However, ‘in its ordinary usage the phrase “lack of jurisdiction” is not limited to these fundamental situations.’” (American Contractors, supra, 33 Cal.4th at p. 661; In re Marriage of Jackson (2006) 136 Cal.App.4th 980, 988 [“[i]n a broader sense, lack of jurisdiction also exists when a court ‘make[s] orders which are not authorized by statute’”].) “It may also ‘be applied to a case where, though the court has jurisdiction over the subject matter and the parties in the fundamental sense, it has no “jurisdiction” (or power) to act except in a particular manner, or to give certain kinds of relief, or to act without the occurrence of certain procedural prerequisites.’ [Citation.] ‘“[W]hen a statute authorizes [a] prescribed procedure, and the court acts contrary to the authority thus conferred, it has exceeded its jurisdiction.”’ [Citation.] When a court has fundamental jurisdiction, but acts in excess of its jurisdiction, its act or judgment is merely voidable. [Citations.] That is, its act or judgment is valid until it is set aside, and a party may be precluded from setting it aside by ‘principles of estoppel, disfavor of collateral attack or res judicata.’ [Citation.] Errors which are merely in excess of jurisdiction should be challenged directly, for example by motion to vacate the judgment, or on appeal, and are generally not subject to collateral attack once the judgment is final unless ‘unusual circumstances were present which prevented an earlier and more appropriate attack.’” (American Contractors, at p. 661; accord, People v. Allegheny Casualty Co. (2007) 41 Cal.4th 704, 716, fn. 7.)
We agree with Janet that, whatever technical deficiencies may exist with the 1997 Ostler-Smith order, principles of estoppel preclude Vahik from setting it aside on that basis at this late date. (See In re Griffin (1967) 67 Cal.2d 343, 347-348 [“When . . . the court has jurisdiction of the subject, a party who seeks or consents to action beyond the court’s power as defined by statute or decisional rule may be estopped to complain of the ensuing action in excess of jurisdiction. [Citations.] Whether he shall be estopped depends on the importance of the irregularity not only to the parties but to the functioning of the courts and in some instances on other considerations of public policy.”]; see generally In re Marriage of Jackson, supra, 136 Cal.App.4th at pp. 994-995.) The 1997 judgment was prepared for the court by Vahik’s counsel, and Vahik did not challenge it on appeal or otherwise object in a timely fashion to the propriety of calculating support, in part, as a percentage of his excess earnings over a baseline salary. (Cf. American Contractors, supra, 33 Cal.4th at p. 661.) Moreover, by seeking to ensure that Vahik and Janet’s children would benefit from their father’s additional earnings (by overtime or bonus), the order was plainly designed to serve their best interests, even though the family law court did not explain in the judgment of dissolution its reasons for departing from the uniform state guideline formula or for selecting 40 percent of Vahik’s excess earnings as the supplementary amount. (See generally Fam. Code, § 4053, subd. (a) [“[a] parent’s first and principal obligation is to support his or her minor children according to the parent’s circumstances and station in life”].) In sum, although other grounds exist for denying Janet’s motion to recover 12 years of arrearages, the court erred in allowing Vahik’s collateral attack on the 1997 judgment and denying Janet’s request on the sole ground the Ostler-Smith order was void or otherwise unenforceable as a matter of law.
2. The 1997 Family Support Order Was Superseded by the 1998 Modified Support Order
Although the 1997 family support order, including the Ostler-Smith percentage allocation of excess earnings, was enforceable, that order was modified in 1998 in response to Janet’s application for increased support; and, as a result, Janet was no longer entitled to a portion of Vahik’s earnings in excess of the former base salary. As discussed, on August 5, 1998, claiming Vahik’s income had risen considerably during the two years since the parties’ separation, Janet filed an application for an order to show cause to modify her family support order, seeking “guideline” support for her children and herself. Janet did not seek any arrearages based upon Vahik’s purported failure to pay a percentage of excess earnings. In his opposition declaration, filed on October 1, 1998, Vahik asserted Janet had both overstated his past and current income and understated her own ability to support herself and also claimed he had slightly overpaid family support due Janet through August 1998.
On October 14, 1998, in response to the conflicting evidentiary presentations, the court found Janet’s earning capacity had not changed and ordered Vahik to pay “family support in the amount of $1950, beginning October 1, 1998 and until further order of the court.”^[10] Thus, the October 1998 order superseded the earlier family support order, which had combined a fixed monthly base payment with a contingent percentage, Ostler-Smith award, with an increased monthly amount to be paid by Vahik to Janet. The elimination of the Ostler-Smith percentage component of the support order is confirmed by the court’s modified wage assignment order, which, like the 1998 support order itself, describes a fixed monthly sum and omits any reference to payments to Janet based upon a percentage of Vahik’s overtime or bonus compensation.
Janet insists the Ostler-Smith portion of the 1997 support order could not have been discontinued in 1998 because it was not expressly mentioned in either her application for a modification of family support or the court’s order granting the requested modification. Although true, this silence as to one portion of the integrated family support order is irrelevant. Janet provided the court with new income and expense information in 1998 and argued Vahik’s “change of income and his ability to pay should be considered a change of circumstance,” justifying entry of a modified support order. Both parties necessarily knew the full scope of Vahik’s support obligation to his former wife and his children was before the court. Based on the declarations submitted, Janet obtained the relief she requested—increased support—even if not in as large a sum as she may have hoped. The court plainly had the discretion to enter the order it made (an order not appealed by Janet or Vahik), and Janet was entitled only to that level of support from October 1, 1998 forward.
That Janet fully understood the scope of the 1998 order is confirmed by her initial opposition to Vahik’s 2007 application to terminate spousal support and reduce child support. Janet insisted Vahik had orally agreed to continue paying “the current support amount of $1,950 per month” through December 2009. There was no mention of any additional sum that might be due under the 1998 support order as a result of an Ostler-Smith percentage formula, notwithstanding the fact that Vahik had disclosed his monthly income exceeded $10,000 (a figure that would have entitled Janet to at least an additional $2,000 per month if the 40 percent formula from 1997 was still in effect). Similarly, the agreement the parties finally reached, embodied in the 2007 stipulation and order, neither identified any arrearages based on the superseded 40 percent formula nor contemplated any such payments on a going forward basis.
3. Remand Is Necessary To Determine Whether Janet Is Entitled to Support Arrearages for the Period Prior to the 1998 Modification of Family Support
What about possible arrearages for the 16-month period between June 1, 2007, the effective date of the family support order set forth in the July 15, 1997 judgment of dissolution, and October 1, 1998, the effective date of the modified family support order‌ Family Code section 3651, subdivision (c), provides, with an exception not relevant to this case, “a support order may not be modified or terminated as to an amount that accrued before the date of the filing of the notice of motion or order to show cause to modify or terminate.” Accordingly, even though the 1998 order eliminated Vahik’s obligation to pay a percentage of excess earnings over a base salary in the future, it could not (and, in fact, did not purport to) eliminate any past due support obligation.
Citing County of Santa Clara v. Wilson (2003) 111 Cal.App.4th 1324, Vahik argues the court has equitable discretion to refuse to enforce a support order that is inconsistent with current child support statutes. “Although a court may not ‘disturb the accrual of payments under the original [child support] judgment,’ it does have some equitable powers regarding the enforcement of the judgment. [Citation.] ‘The court ha[s] equitable discretion to determine whether and to what extent the original support provision should be enforced by execution.’” (Id. at p. 1326.) Because the matter before it involved the supporting parent’s motion to modify support and not an enforcement action, however, the Wilson court did not consider the nature or limits of that equitable discretion. (Ibid.)
Notwithstanding the Wilson court’s dicta, some traditional equitable defenses are simply not available in actions to enforce a support order. Thus, Janet’s delay in seeking enforcement of the Ostler-Smith portion of the 1997 family support order, even though perhaps unreasonable in light of the several opportunities she had to raise the issue in connection with pending court proceedings to modify support, does not itself preclude her right to seek arrearages. Although courts previously applied the doctrine of laches to bar the recovery of arrearages, in 2002 the Legislature enacted former Family Code section 4502, subdivision (c) (Stats. 2002, ch. 304, § 1, now codified at Fam. Code § 291, subd. (d); see Stats. 2006, ch. 86, § 4), expressly limiting the defense of laches in actions to enforce child, family or spousal support to “any portion of the judgment owed to the state.” This statute is retroactive, applicable in all case regardless when the arrearages accrued. (In re Marriage of Fellows (2006) 39 Cal.4th 179, 186-187.) Similarly, although the Family Code does not expressly bar a waiver defense to actions to recover accrued support arrearages, case law precludes inferring waiver from acceptance without objection of a lesser amount than is actually owed. (See, e.g., In re Marriage of Hamer (2000) 81 Cal.App.4th 712, 722 [“lack of diligence can no longer be asserted or considered as a defense to the enforcement of child support orders and the collection of arrears”]; In re Marriage of Sabine & Toshio M. (2007) 153 Cal.App.4th 1203, 1214 [same].)
Other equitable defenses may be available. Whether Vahik can prove Janet should be estopped from collecting any family support arrearages that accrued during this 16-month period or establish the elements of some other cognizable equitable defense to Janet’s enforcement action (cf. In re Marriage of Brinkman (2003) 111 Cal.App.4th 1281, 1289-1291 [discussing elements of estoppel in context of action to collect child support arrears]), however, is appropriately determined by the family law court in the first instance. We therefore remand the matter for a determination whether any arrearages exist for the period between June 1, 1997 and October 1, 1998 and, if so, whether any equitable defense to recovery of that accrued support exists. In this context we remind the parties, although Janet cannot lawfully forgive past due support payments, they can settle any genuine dispute that might affect the calculation of arrearages. (See In re Marriage of Sabine & Toshio M., supra, 153 Cal.App.4th at pp. 1214-1215 [although past due support cannot be modified retroactively or forgiven by supported spouse, parties can enter an enforceable accord and satisfaction if they have resolved a bona fide dispute concerning the debt].)
DISPOSITION
The order is reversed, and the matter remanded for further proceedings not inconsistent with this opinion. Each party is to bear her or his own costs on appeal.



PERLUSS, P. J.


We concur:



WOODS, J.



ZELON, J.


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