Perry
Filed
2/1/13 Marriage of Perry CA5
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT
In re the Marriage of DIANA and
SCOTT PERRY.
DIANA CHANDLER,
Appellant,
v.
SCOTT PERRY,
Appellant.
F062331
(Super.
Ct. No. 05CEFL02294)
APPEAL from
a judgment of the Superior Court of
County. Jonathan M. Skiles and M.
Bruce Smith, Judges.
Yarra,
Kharazi & Associates and H. Ty Kharazi for Appellant Diana Chandler.
John
Brekhus and Christine J. Levin for Appellant Scott Perry.
-ooOoo-
INTRODUCTION
Scott Perry
(Perry) appeals from two 2011 orders of the trial court denying his motion to
set aside a stipulated order regarding spousal support and a separate motion
for spousal support. Diana Chandler
(Chandler), formerly Diana Perry, cross-appeals raising various issues arising
from the trial court’s denial of her request for attorney fees. In addition, Chandler has moved to dismiss a
portion of Perry’s appeal and has requested imposition of sanctions. For reasons to be stated, we conclude the
July 8, 2010, order was an appealable order after judgment (Code Civ. Proc.,
§ 904.1, subd. (a)(2)), that a final judgment on the issue of spousal
support was entered on July 8, 2010, and that the trial court was correct in
treating Perry’s subsequent motion as a request for modification of spousal
support, and not as an original motion for permanent spousal support. We have determined that none of the other
issues raised by the parties establish reversible error. Accordingly, we affirm all of the orders from
which the parties have appealed. In
addition, we deny the motion to dismiss and decline to impose sanctions.
FACTS AND PROCEDURAL HISTORY
Judgment of
Dissolution
Perry and
Chandler married in 1979. During the
last 10 years of the marriage, approximately, the parties were partners in a
business known as Lien Machine. Chandler
filed an action for dissolution of marriage in 2005. In 2007, the court entered temporary orders
permitting Chandler to operate the business.
Among other provisions of the temporary orders was an order that each
party would receive a monthly draw of $7,500 from the business and that certain
other expenses of the parties would be paid by the business. By stipulation of the parties, the matter was
bifurcated and the court entered a judgment of dissolution on October 7, 2008,
as to status of marriage only; the court reserved jurisdiction over all other
issues. (See Fam. Code, § 2337.)
Stipulated Agreement
on Reserved Issues
On February
1, 2010, the parties appeared for a settlement conference. At the conclusion of the conference, the
parties placed upon the record a stipulated resolution of the reserved
issues. The stipulation awarded personal
and real property to each party, except for real estate at Bass Lake, which was
awarded to the parties as tenants in common, for the purposes of sale and
division of the proceeds. The parties
agreed the court would “reserve jurisdiction to deal with this property in the
event that there is a dispute between the parties.†The stipulation awarded the business to
Chandler. The parties agreed that, as
equalization payments, Chandler would pay Perry $550,000, payable with interest
in monthly installments, and that she would maintain and pay for health and
life insurance for Perry for his life.
and reserved jurisdiction of spousal support as “to either party.†The stipulation made certain other provisions
concerning payment of various debts.
In addition
to the foregoing specific dispositions, the parties stipulated that this was
the full agreement between them and that “neither party owes the other party
anything other than what we’ve talked about with regard to this settlement
today.†Each party waived the “right to
notice and time and place of trial, right to request a statement of decision,
[to] move for a new trial and [the] right to appeal on the issues being
resolved today.†In response to further
questioning of Perry by his own attorney, Perry said that he understood “that
today is a full and final resolution of this caseâ€; that counsel had not had an
opportunity to conduct full discovery and hire an expert to evaluate the
business; and that he “want[ed] to settle it today.â€
Order on Reserved
Issues
The court
adopted the agreement of the parties.
Chandler’s attorney prepared an Order on Reserved Issues, which the
court initially signed on April 29, 2010.
The court subsequently determined that this order did not accurately
reflect the parties’ stipulation (and, therefore, the court’s oral order) in
certain respects, and the court struck the earlier order and entered a new
order on July 8, 2010. The revised order
(prepared by Perry’s attorney) provided, among other provisions, “[Spousal
support] is currently set at zero. The
Court retains jurisdiction over the issue of spousal support for either party.â€
respect to this order.
Subsequent Motion for
Spousal Support, etc.
On
September 2, 2010, Perry, represented by a new attorney, filed a motion for
spousal support in the amount of $7,500 per month, and certain other relief,
including an order requiring Chandler to execute a promissory note to secure
the equalization payments. In his
declaration in support of this motion, Perry contended the parties had not
agreed to a waiver of spousal support; that he had no income; that Chandler had
continued to receive income greatly in excess of the $7,500 per month draw upon
which the parties had agreed during the pendency of the action; and that Perry
required spousal support in order to “meet present[] living expenses consistent
with the standard of living established during the marriage,†citing section
4320.
Motion to Set Aside
Order, Hearing and Ruling
On January 28, 2011, Perry filed a
separate motion to set aside the order (sometimes referred to as a judgment in
Perry’s pleadings) of February 1, 2010 (which was later finalized in the Order
on Reserved Issues dated July 8, 2010).
The hearing on the motion to set aside was heard by Judge Skiles on February
16, 2011. The court denied the motion on
the basis that any procedural defects in the earlier proceedings were not
prejudicial and did not amount to a manifest injustice.
Hearing on Spousal
Support and Ruling
Shortly thereafter, the motion for spousal
support was heard by Judge Smith. Based
on a ruling that the Order on Reserved Issues dated July 8, 2010, constituted a
valid final judgment on the issue of spousal support, Judge Smith concluded
that Perry had not shown a change of circumstances that justified an award of
spousal support under the court’s reserved jurisdiction on that issue, and
denied the motion for spousal support on February 28, 2011. The court awarded certain other relief, and
denied both parties’ requests for attorney fees. Judgment was entered accordingly on March 17,
2011.
Chandler’s Attorney
Fee Request
Chandler, contending that Smith’s
order regarding attorney’s fees did not cover an award of attorney fees
requested on the domestic violence order, reiterated her fee request before
Judge Skiles on March 7, 2011. Judge
Skiles denied the request, finding that Judge Smith had included that issue in
his original denial of fees.
Issues on Appeal
Perry filed a timely notice of
appeal from Judge Skiles’s order dated February 16, 2011, Judge Smith’s
February 28, 2011, order and the judgment entered March 17, 2011. Chandler filed a timely cross-appeal from the
denial of her attorney fee requests.
Perry’s initial theory, asserted in
his September 2, 2010, motion for spousal support, was that there had been no
order concerning permanent spousal support in the February 1, 2010, stipulation
or in the July 8, 2010, order on reserved issues. His declaration stated: “We did not however agree to a waiver of
spousal support.… I was informed that
spousal support would be dealt with at the next hearing.â€
Apparently taking a different
approach in his later declaration in support of the motion to set aside the
judgment, filed January 28, 2011, Perry asserted a new theory that the stipulation
and the July 8, 2010, order on reserved issues were “unfair†because they were
based upon “two year old information and [he] was unaware how the business was
actually doing.†In that declaration, he
does not appear to dispute that the July 8, 2010, order did, in fact, set
permanent spousal support at zero; he appears to contend, instead, that he did
not have sufficient information to support his stipulation to the zero-support
order. Similarly, the points and
authorities in support of the January 28, 2011, motion to set aside are based
entirely on the theory that Chandler did not file a final disclosure of
financial information prior to the stipulation, and that the order of July 8,
2010, must be set aside for this reason.
In this appeal, Perry adopts both
theories: (1) he contends that no
permanent spousal support stipulation was legally permitted without Chandler’s
filing of final financial disclosures (or his own express waiver of that
requirement) and (2) as a matter of construction of the language of the
stipulation and order, the order did not purport to set permanent spousal
support at zero. We address these
contentions in part I. of the Discussion, post. Perry also contends insufficient evidence
supports the court’s denial of spousal support in its ruling on his September
2, 2010, motion for child support. We
discuss this issue in part II. We
discuss the cross-appeal in part III.
Finally, we discuss Chandler’s pending motion to dismiss the appeal in
part IV.
DISCUSSION
I. THE JULY 8, 2010, ORDER AS A FINAL
JUDGMENT
The July 8,
2010, order, captioned “ORDER ON RESERVED ISSUES,†purports to be a final
resolution of all issues between the parties and provides that the parties
waive the right to appeal “on the issues being resolved today.†Because it leaves no further issues for
judicial resolution other than issues arising from enforcement, the July 8,
2010, order is a final judgment for purposes of the Code of Civil Procedure. (Griset
v. Fair Political Practices Com. (2001) 25 Cal.4th 688, 698.) Neither party appealed from that judgment,
making it final for purposes of res judicata and collateral estoppel. (In re
Marriage of Maxfield (1983) 142 Cal.App.3d 755, 759.) Not only has that judgment become final, but
the judgment expressly provides that the parties “waive their right to … move
for a new trial ….â€
title="">[5] Yet Perry’s January 28, 2011, motion in the
trial court was for precisely that relief -- an order setting aside the
judgment and granting him a new trial on spousal support. His express waiver of that remedy in the
stipulated judgment precludes the relief he seeks.
Perry
contends, however, that the Family Code “has very specific and express
procedures as to how and when a judgment may be entered.†He appears to contend that his general waiver
of the right to seek a new trial does not, for reasons he does not explain,
constitute a waiver of the right to seek a new trial under the Family Code. In
particular, Perry contends section 2105 requires that each party file a final
declaration of financial disclosure or that the parties expressly waive that
requirement in the detailed terms set forth in section 2105, subdivision
(d). The parties did not comply with
section 2105 in this case. Section 2106
provides that “no judgment shall be entered with respect to the parties’
property rights†unless the parties have complied with section 2105. Section 2107, subdivision (d) provides: “[I]f a court enters a judgment when the
parties have failed to comply with all disclosure requirements of this chapter,
the court shall set aside the judgment.
The failure to comply with the disclosure requirements does not
constitute harmless error.†Such a
motion to set aside a judgment must be made within “one year after the date on
which the complaining party either discovered, or should have discovered, the
failure to comply.†(§ 2122, subd.
(f).)
have the order on reserved issues set aside, even if it was a final judgment
under Griset v. Fair Political Practices
Com., supra, 25 Cal.4th at page 698, because section 2107, subdivision (d)
specifically provides for such relief, and even if he expressly waived the
right to a new trial.
The
appellant in In re Marriage of Steiner
& Hosseini (2004) 117 Cal.App.4th 519 (Steiner) made a similar claim.
The Court of Appeal stated: “In
this appeal we conclude that the failure on the part of two divorcing spouses
to exchange final declarations of disclosure … does not constitute a
‘get-a-new-trial-free’ card, giving either one of them the automatic right to a
new trial or reversal on appeal when there is no showing of a miscarriage of
justice. (Cal. Const, art. VI,
§ 13.)†(Id. at p. 522.) The court
explained that the constitutional requirement of prejudice for reversal of a
judgment supersedes the statutory attempt to relieve an appellant of such a
showing in the circumstances of section 2107, subdivision (d). (Steiner,
supra, at p. 527.)
Perry
contends Steiner is inapplicable
because that judgment was entered after a trial of all of the issues so,
presumably, the court knew all of the information that would have been
disclosed if the parties had complied with section 2105, whereas neither Perry
nor the trial court knew what would have been in Chandler’s disclosure, if she
had timely filed the disclosure. We
reject this distinction for two reasons.
First, Steiner’s rationale was
not based on the fact that the trial court may have known the same information;
the decision was based on a policy against permitting a party to unilaterally
create the conditions for automatically setting aside an otherwise valid
judgment. (Steiner, supra, 117 Cal.App.4th at p. 528.)
Second, even though Perry complied
with the disclosure requirement himself, he waived all claims against Chandler and waived the right to a new trial on
from his own counsel, Perry acknowledged that there was other information that
he might obtain in this case, but that he wanted to enter into the stipulated
judgment. In addition, counsel
asked: “There is no need for you to talk
to me any further about this matter and you want to settle it today; is that
correct?†Perry answered “Yes.†As in Steiner,
supra, 117 Cal.App.4th at page 528 it would “create[] a most perverse set
of incentives†to permit a party who has expressly released
move for a new trial without a showing of prejudice, simply because the moving
party did not expressly include the waivable
right to disclosure contained in section 2105.
(See § 2107, subd. (d).) We
conclude, pursuant to Steiner, supra,
at page 527, that Perry was required to establish that entry of the
July 8, 2010, judgment constituted a miscarriage of justice in order
to entitle him to a new trial on any of the issues included in that
judgment. He failed to do this.
Perry next
contends he established adequate prejudice because Chandler failed to disclose
that she had not paid all of the taxes she had been ordered to pay in a 2007
order and that “she had not provided [Perry] with the 2008 and year end 2009
partnership returns and financial information until after 2010.†As to the latter information, Perry
acknowledged he knew he did not have that information and wanted to enter into
the stipulation in any event.
Accordingly, he has not shown that the absence of such information
materially affected his determination to enter into the stipulation. While the record is not clear that Perry knew
at the time of the stipulation that Chandler had not paid the required taxes,
Perry has made no showing this would have affected the issue of spousal
support. A party who obtains an order
setting aside a dissolution judgment because the opposing spouse has failed to
make disclosures is only entitled to set aside “those portions of the judgment
materially affected by the nondisclosure.â€
(§ 2105, subd. (c).)
As far as we can determine from the
record (and as alleged in Perry’s declaration in support of his motion for
spousal support), the 2007 order required that “the business†shall continue to
pay all personal and business taxes.
Perry fails to explain why any failure to make such payment by the
business would have been disclosed on Chandler’s personal financial
disclosures. In the absence of a dual
showing -- that the information in question would have been on the disclosures
and that the information would have led to different terms of the stipulation
-- Perry has failed to establish that the failure to comply with section 2105
was prejudicial. (Cal. Const., art. VI,
§ 13.) As a result, we conclude
that the trial court’s (Judge Skiles) February 16, 2011, denial of the motion
to set aside judgment clearly was correct and must be affirmed.
In his
reply brief, Perry takes a somewhat different tack. There, he acknowledges that the stipulated
order of July 8, 2010, was a final judgment on many issues of property
division, but he contends the order did not seek to establish permanent spousal
support and, in fact, the parties agreed to “resolve the payment of permanent
spousal support at a future time.†This
contention is without any support in the record whatsoever.
The parties
were married in 1979. Although there
is some dispute whether the marriage was
of 26 or 27 years duration, in either case it was a “marriage of long
duration,†as defined in section 4336, subdivision (b) [“presumption … that a
marriage of 10 years or more … is a marriage of long durationâ€]. In such cases, unless there is a “written
agreement of the parties to the contrary or a court order terminating spousal
support, the court retains jurisdiction indefinitely ….†(§ 4336, subd. (a).) That retained jurisdiction includes jurisdiction
to award spousal support, whether permanent spousal support is awarded in the
final judgment or not. (
Cal.App.4th 63, 65-66.) In the present
case, the stipulation of the parties and the subsequent order on reserved
issues established permanent spousal support at zero. Reiterating that there was no “agreement of
the parties to the contrary†under section 4336, subdivision (a), the
stipulation and the order also stated that the issue of spousal support “shall
be reserved to either party.†All of the
relevant language in the stipulation and in the order contemplates that the
setting of spousal support at zero was a part of the full and final resolution
of all the issues between the parties; as affirmed by Perry upon questioning by
his attorney, “today is a full and final resolution of this case.†There is no support in the record whatsoever
for Perry’s contrary assertion on appeal.
Perry’s
reply brief also contends that Judge Skiles, at the hearing on the motion to
set aside the judgment, “expressly acknowledged that setting permanent spousal
support was expressly reserved in the judgment ….†This entirely and overtly mischaracterizes
Judge Skiles’s statements. Judge Skiles
clearly ruled that the order, including the portion setting spousal support at
zero, constituted a final judgment on reserved issues. Judge Skiles also added that
dependent on setting aside the judgment:
“[T]he Court still has retained jurisdiction to modify if the facts
warrant modification. That doesn’t require
me to set aside the judgment. It’s part
of the judgment.â€
To
summarize this portion of the opinion, we conclude that the order on reserved
issues constitutes a final judgment, and that this final judgment sets the
current amount of permanent spousal support to each party as “zero.†Even if Perry had not expressly waived his
right to a new trial, he still would be required to demonstrate prejudice, as
required by California Constitution article VI, section 13, in order to set
aside that final judgment under section 2107, subdivision (d). He has not done so.
II. THE SPOUSAL SUPPORT HEARING AND ORDER
Perry
contends the trial court (Judge Smith) abused its discretion in declining to
increase spousal support for Perry from zero, the amount initially agreed to by
the parties and established in the July 8, 2010, order on reserved issues. This argument is based solely on the
erroneous premise that the July 8 order did not establish a permanent spousal
support award. As we have discussed in
the previous section, the “zero†award was for permanent spousal support --
modifiable in accordance with the law regarding support, but nevertheless a
permanent, not temporary award. Because
we reject Perry’s premise that he was entitled to a “ground up†initial hearing
on spousal support at the hearing before Judge Smith pursuant to section 4320,
we reject Perry’s conclusion that the court erred in failing to conduct such a
hearing.
The trial
court, in fact, conducted a three-day hearing on the motion for spousal support
and made findings relevant to a request for change in permanent spousal
support, in accordance with the requirements set forth in In re Marriage of Hoffmeister (1987) 191 Cal.App.3d 351, 363.
2010 stipulated judgment permitted an inference that both spouses needs were
met at the time of the judgment, which was only a few months prior to the
filing of Perry’s new motion for support.
To the extent the evidence established a change in circumstances for
Chandler, it tended to show that her business revenues had decreased. The evidence established that Perry’s needs
had not increased; he still had the same training, licenses and earning
ability; he still owned the real and personal property he was awarded in the
judgment; and he had elected to start business ventures instead of seeking
employment. As a result of all of these
conclusions, the court found that Perry had “not demonstrated to this Court
that there has been a disparate impact to his income.†Perry has not demonstrated on this appeal
that the court’s findings are not supported by the evidence or that its
conclusions are an abuse of discretion.
(In re Marriage of Dietz (2009)
176 Cal.App.4th 387, 398 [abuse of discretion is relevant standard of review of
orders modifying spousal support].)
Perry
contends the court’s conclusion concerning the date the parties separated and
its conclusion concerning Chandler’s current income were not supported by
substantial evidence. Perry has not
demonstrated any way in which these facts are material, in light of the trial
court’s conclusion that Perry had not shown a change in his needs or in his
earning ability. (See
Cal.App.3d at pp. 363-364.)
III. CHANDLER’S CROSS-APPEAL FOR ATTORNEY’S FEES
Chandler
has cross-appealed, contending the trial court did not determine the issue of
attorney fees in two respects, and contending she is entitled to a hearing
limited to those two aspects of her fee request. After examination of the record, we agree
with the trial court’s (Judge Skiles) conclusion at a March 7, 2011, hearing,
to the effect that all issues concerning attorney fees had been decided at
previous hearings.
In Chandler’s opening brief as
cross-appellant, she notes she requested attorney fees in connection with the
spousal support motion, and that she requested fees both as a matter of
financial equity under section 2030, subdivision (a)(1), and as a litigation
sanction under section 271. She correctly
points out that Judge Smith, at the February 28, 2011, hearing on the
merits of the support modification motion, only considered matters of financial
equity and did not address sanctions.
Chandler does not point out, however, that Judge Skiles, at the February
16, 2011, hearing on the motion to set aside the judgment, ruled that attorney
fees as a sanction against Perry “at least at this point†were unwarranted,
because the motion regarding spousal support was not frivolous or wholly
unwarranted. Judge Skiles had an
opportunity to revisit the issue of section 271 attorney fees at the
March 7, 2011, hearing, and he stated that he had denied such fees on
February 16, 2011. Chandler’s counsel
expressly agreed with the court’s statement.
The record on appeal does not support Chandler’s contention that the
trial court did not rule on her request for an award of attorney fees as a
sanction under section 271.
At the March 7, 2011, hearing,
Chandler’s attorney did contend to Judge Skiles that Judge Smith had not ruled
on Chandler’s request for fees pursuant to section 6344, which provides for an
award of attorney fees in domestic violence proceedings. Judge Skiles found that the request for fees
from the restraining order proceeding had been included in Chandler’s request
for fees at the spousal support hearing, and had been resolved by Judge Smith
when he denied, more generally, fees to either party at the February 28, 2011,
hearing. We have reviewed the record of
the February 28, 2011, hearing, and we conclude that Judge Smith intended to
rule on all of the attorney fees requests that were before him at that time,
which included the section 6344 fee request, even though he did not separately
identify the fee request arising under that section. In denying the fee request, he noted the
total amount of fees requested by Chandler, and this figure included the fees
arising from the restraining order.
Because the award of fees under section 6344 is not a sanction or a
penalty for engaging in domestic violence, but is instead based on financial
equity to permit the moving party to have access to the courts (see
§ 6344, subd. (b)), a similar standard to the fee issue under section
2030, there is no reasonable likelihood the trial court would have reached a
different conclusion if its determination had expressly included consideration
of section 6344. (People v. Watson (1956)
46 Cal.2d 818, 836.)
IV. CHANDLER’S
MOTION TO DISMISS APPEAL AND REQUESTS FOR SANCTIONS
By separate
motion filed September 8, 2011, Chandler moved to dismiss the appeal and for imposition
of sanctions. Perry filed a response and
this court, by order of September 30, 2011, deferred consideration of the
motion pending our consideration of the merits of the appeal. The motion is based on the premise that Judge
Skiles’s order at the February 16, 2011, hearing on the motion to set aside the
judgment was not an appealable order, for various reasons. The motion does not address the portion of
the appeal arising from Judge Smith’s February 28, 2011, order or March 17,
2011, judgment.
We deny the
motion to dismiss. Even if the February
16 order was not appealable, Judge Smith revisited the same issues at the
hearing on the merits of the support motion.
Accordingly, those issues are properly before us and dismissal of the
appeal is not warranted even if, as contended by Chandler, the requested relief
on appeal (i.e., reversal of Judge Skiles’s order as well as Judge Smith’s) was
not available to Perry as appellant.
Similarly, the request for sanctions is limited to the appeal insofar as
it seeks review of the February 16, 2011, order. Since we have determined that the issues
raised by that order were properly before us, award of sanctions for filing the
appeal is inappropriate. The motion for
sanctions is denied.
In her
respondent’s brief, Chandler also makes a more generalized request for
sanctions based, in effect, on poor lawyering by Perry’s last attorney in the
trial court and current appellate counsel.
Chandler relies on Evans v.
Centerstone Development Co. (2005) 134 Cal.App.4th 151 in support of her
request for sanctions. In
“cornucopias†of rules violations, and the “violations continued in the reply
brief even after defendants had highlighted them in the motion for
sanctions.†(Id. at p. 166.) In addition,
the appeal was from a nonappealable arbitration award and plaintiffs’ “crude
attempts†to characterize the issues as appealable was merely “an
artifice.†(Id. at p. 167.) Monetary
sanctions were awarded against the plaintiffs and their counsel jointly. (Id.
at p. 168.)
It is clear
that the record in this case was assembled, presented, and cited in briefing by
Perry’s counsel in a manner that burdened opposing counsel and the court. Many of Perry’s arguments, as we have
indicated in this opinion, were patently without merit or were directly
contradicted by the record.
Nevertheless, one issue, namely, the trial court’s exercise of
discretion in denying the motion to increase the spousal support based on
changed circumstances, presented colorable legal issues. Other issues, while meritless, were
apparently presented in subjective good faith.
(See Airlines Reporting Corp. v.
Renda (2009) 177 Cal.App.4th 14, 22.)
Finally, we note that after Chandler’s
brief pointed out the failings of Perry’s opening brief and requested
sanctions, Perry’s counsel associated co-counsel and the
improvement over the opening brief. (See
Evans v. Cornerstone Development Co.,
supra, 134 Cal.App.4th at p. 166.)
While it is a close matter, and reasonable minds might disagree, we
conclude that sanctions will not be imposed in this appeal.
DISPOSITION
The orders
from which the appeal and cross-appeal were taken, namely, the trial court’s
orders of February 16, February 28, and March 7, all of 2011, are
affirmed. Respondent is awarded costs on
appeal.
_____________________
Franson, J.
WE CONCUR:
_____________________
Gomes, Acting P.J.
_____________________
Kane, J.
name="_ftn1" title="">[1]
All further statutory references
are to the Family Code unless noted otherwise.
name="_ftn2" title="">[2]
The monthly equalization payment
was $7,500 from Chandler to Perry. As a
net result, from and after the date of this stipulation, Perry received no
further monthly income from Lien
Machine but received an equal monthly payment as a capital distribution.
