Filed 11/16/18 Marriage of Sadro & Rezvani CA1/5

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FIVE

Ahmad Rezvani (Husband) appeals a family court order characterizing certain real property as a community asset and requiring him to reimburse Tahereh Sadri (Wife) for her medical expenses. We affirm.

I. Background

The admitted evidence at trial showed the following.[1] In 1986, shortly before the marriage, Husband bought a residence in San Francisco, which was paid in part with a mortgage. Husband and Wife married in 1987 and lived in the San Francisco residence for almost four years. In approximately 1989, Husband took a job in Sonoma, and the family moved there in 1991. Husband told Wife he would not buy the Sonoma residence unless she signed a quitclaim deed. Husband’s separate property was used to pay the down payment on the Sonoma residence, and title was taken in his name alone.

Wife signed a quitclaim deed that transferred her spousal interest in the Sonoma residence to Husband purportedly for valuable consideration, but without receiving any actual consideration. In 1992, the Sonoma mortgage was refinanced, and Wife again signed a quitclaim deed without receiving any consideration. The mortgage was paid from a credit union account where Husband also deposited his paychecks, and the loan was paid off in 2007. After separating in 2008, Wife moved out and Husband had exclusive use of the Sonoma residence.

Before signing the first quitclaim deed, Wife spoke to someone at a law school legal clinic (at Husband’s suggestion but outside of his presence). She understood the purpose of the quitclaim deed was only to preserve Husband’s separate property interest in his down payment on the residence, not to give up any spousal interest she had in the residence. She signed the quitclaim deeds in part because she was afraid of Husband. Wife feared Husband because of an incident of physical violence during their marriage, repeated verbal abuse, and threats that Husband would have her stoned or take their son to Iran.

Following separation, Wife continued to be covered by Husband’s health insurance policy.[2] In October 2014, Husband’s employer directed him to submit “dependent eligibility verification to HR by Thursday, Oct. 23 to avoid the deletion of your dependents from your health & dental insurance.” Husband did not do so for Wife, and her insurance was cancelled on October 31, 2014. Wife asked Husband to reinstate her insurance, and she provided him with relevant documents. Husband said he would submit the documents, but he never followed through. Wife was diagnosed with breast cancer in the fall of 2014, and she had to obtain her own health insurance and pay additional out-of-pocket medical costs to treat her condition. On March 6, 2015, the court ordered Husband to “reinstate Wife onto his health insurance policy.” Husband never did so.

Following trial in October and November 2015, the court issued a statement of decision. As relevant here, the court ruled that Husband failed to rebut a presumption of undue influence regarding the quitclaim deeds. It characterized the Sonoma residence as community property, but ruled Husband was entitled to reimbursement for his separate-property down payment. Because Husband had sole use of the Sonoma residence for seven years following separation, he owed Wife half of the value of that use ($99,456). Husband breached his fiduciary duty to Wife by failing to reinstate her on his health insurance policy and therefore had to reimburse her medical expenses. After characterizing the couple’s property as separate or community and dividing the community estate, the court declared the San Francisco residence and certain funds Husband’s property and the Sonoma residence and other funds Wife’s property.

II. Discussion

A. Characterization of Sonoma Residence as Community Property

Husband first argues the trial court erred in characterizing the Sonoma residence as community property. We disagree.

“Courts typically apply a substantial evidence standard of review to the court’s characterization of property as separate or community. [Citations.] . . . ‘[O]ur review is limited to a determination whether there is any substantial evidence, contradicted or uncontradicted, that supports the finding. [Citations.] In so reviewing, all conflicts must be resolved in favor of [the prevailing party] and all legitimate and reasonable inferences must be indulged to uphold the finding.’ ” (In re Marriage of Brandes (2015) 239 Cal.App.4th 1461, 1472 (Brandes).) Questions of law are decided de novo. (Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 800.) Contrary to Husband’s argument, this case presents no mixed questions of law and fact that warrant de novo review.

“[T]here is a general presumption that property acquired during marriage by either spouse other than by gift or inheritance is community property unless traceable to a separate property source.” (In re Marriage of Haines (1995) 33 Cal.App.4th 277, 289–290; see § 760.) Because the Sonoma residence was acquired during the marriage, it was presumptively community property. (See § 760; In re Marriage of Valli (2014) 58 Cal.4th 1396, 1400.) Husband bore the burden of rebutting the presumption. (Valli, at p. 1400.)

Husband was largely precluded from attempting to trace the Sonoma mortgage payments to a separate property source as a consequence of the discovery sanctions. Husband suggests the court committed legal error by imposing sanctions, but he cites no legal authority and presents no legal argument to show the court exceeded its authority. Therefore, the claim is forfeited. (Guthrey v. State of California (1998) 63 Cal.App.4th 1108, 1115–1116 [appellate court may deny claim on appeal that is unsupported by legal argument applying legal principles to the particular facts of the case on appeal].) In any event, the court clearly had authority to impose the sanctions. Although denominated as an issue sanction, i.e., an order that designated facts be taken as established (Code Civ. Proc., §§ 2031.320, subd. (c), 2023.030, subd. (b)), the court actually imposed an evidence sanction—an order that prohibits a party from introducing designated matters in evidence (id., § 2023.030, subd. (c))—here, documents or testimony regarding Husband’s financial accounts that he failed or refused to produce in discovery. (See In re Marriage of Boblitt (2014) 223 Cal.App.4th 1004, 1022 [ordinary civil discovery rules apply in marital dissolution proceedings].) The trial court had ample grounds to impose the sanction. Husband had repeatedly “fail[ed] to obey . . . order[s] compelling” production of discovery (see Code Civ. Proc., § 2031.320, subd. (c)), and the court found Husband had willfully and intentionally withheld the documents. The court did not abuse its discretion. (See In re Marriage of Chakko (2004) 115 Cal.App.4th 104, 108 [discovery sanctions reviewed for abuse of discretion].)

Husband makes a less than clear argument that he was not required to trace the Sonoma mortgage payments back to his separate property, apparently because Wife had stipulated the down payment came from his separate property. He cites Brandes, which involved a husband’s business that was separate property at the start of the marriage, but increased substantially in value during marriage. (Brandes, supra, 239 Cal.App.4th at pp. 1467–1470, 1472.) The court rejected wife’s argument that the business’s growth during marriage amounted to a new company that was entirely community property.[3] (Id. at pp. 1474–1476.) Brandes is inapposite. Here, the court determined the community property interest in a fixed asset not an ongoing business; the residence was acquired during marriage, giving rise to a community property presumption; the parties stipulated that Husband made the down payment from his separate property and the court reimbursed him for that contribution pursuant to section 2640, subdivision (b); and neither did Husband prove, nor the parties stipulate, that he made any other separate property contribution to the residence.

Husband also contends evidence admitted at trial demonstrated the Sonoma residence was paid for solely with his separate property. In addition to the down payment, which concededly came from his separate property, he claims the mortgage payments were paid with rental income from the San Francisco residence. He claims this income as separate property because the San Francisco residence was purchased before marriage, the down payment was paid with his separate property, and title was taken in his name only. Although refinanced in 1995 with a loan secured by a deed of trust in both Husband’s and Wife’s names, Wife executed a 1995 interspousal transfer grant deed transferring her interest in the San Francisco residence to Husband, again purportedly for valuable consideration but without receiving any consideration. Husband claims that, when he and Wife lived in San Francisco, he paid the mortgage from his separate property because he was unemployed at the time. After they moved to Sonoma, he claims, the San Francisco mortgage was paid with rental income from the San Francisco residence.

Husband made this same argument at trial, but the court’s implied findings to the contrary are supported by substantial evidence. Wife testified that Husband had part-time work when they lived in the San Francisco residence, which supported an inference that at least some of mortgage payments were paid with community funds. There was evidence that, after the family moved to Sonoma, Husband comingled the San Francisco rental income by deposit in the same bank account as his paychecks and paid the San Francisco mortgage from that same account. “[I]f the separate property and community property interests have been commingled in such a manner that the respective contributions cannot be traced and identified, the entire commingled fund will be deemed community property.” (In re Marriage of Braud (1996) 45 Cal.App.4th 797, 823.) Tracing must satisfy “exacting standards of proof.” (Id. at p. 824.) The court implicitly attributed all mortgage payments on the San Francisco residence to community property and concluded that, while the San Francisco residence was Husband’s separate property, the community interest in it was substantial: $736,757, about half of its value. Husband does not directly challenge those findings on appeal.[4] In sum, Husband did not successfully trace the San Francisco mortgage payments to his separate property. Moreover, Husband does not contend any trial evidence traced the property insurance and tax payments on the Sonoma residence to his separate property.

Finally, Husband argues that, regardless of the source of the Sonoma mortgage payments, the quitclaim deeds signed by Wife raised a presumption that the Sonoma residence was his separate property, and there was insufficient evidence of undue influence to overcome that presumption. It is well established that the presumption that property acquired during marriage is community property “can be altered by agreement of the spouses.” (In re Marriage of Haines, supra, 33 Cal.App.4th at p. 291.) Such agreements, however, “must comport with the rules controlling the actions of persons occupying confidential relations with each other. ([§ 721, subd. (b)].)” (Haines, at p. 293.) If the agreement provides one spouse with an advantage, a presumption of undue influence arises, and when the agreement takes the form of a deed, the presumption of undue influence prevails over the common law presumption in favor of title. (Id. at pp. 293–294, 302.) Specifically, when one spouse deeds her interest in community property to the other spouse for no consideration, a presumption of undue influence arises. (In re Marriage of Burkle (2006) 139 Cal.App.4th 712, 731.) Rather than rebut this presumption, the trial evidence reinforced it. Wife testified she feared physical and emotional abuse from Husband at the time she signed the deeds, and she did not understand she was forfeiting a right to community property by doing so. Husband challenges the credibility of Wife’s evidence, but our role is not to reweigh the evidence but to determine if the record contains substantial evidence supporting the trial court’s findings. (See Brandes, supra, 239 Cal.App.4th at p. 1472.) Husband argues the court ignored Wife’s testimony that she did not sign the quitclaim deeds under a specific threat by Husband to take their son to Iran if she did not, and that she did not contend he physically forced her to sign the quitclaim deeds. However, Wife testified she signed the quitclaim deeds because she was afraid of Husband, and her separate testimony about Husband’s threats and other abusive conduct explained that fear. Wife’s testimony, therefore, was substantial evidence of undue influence. On this record, the court did not err in refusing to characterize the Sonoma residence as Husband’s separate property based on the quitclaim deeds.

B. Breach of Fiduciary Duty

Husband argues the trial court erred in ruling he breached his fiduciary duty to Wife by failing to reinstate her on his health insurance policy. Citing his own testimony, Husband claims the evidence showed he reasonably believed he could not reinstate her without falsely stating she was living with him after their separation. Wife, however, testified the insurer advised her she could be covered by Husband’s policy as a separated spouse and proof of a common residence was required only for nonmarried couples. Wife’s testimony was substantial evidence that supported the trial court’s finding that Husband culpably refused to reinstate Wife to his policy and thus supports the finding that he breached his fiduciary duty to Wife and had to reimburse her uninsured medical costs. (See In re Marriage of McTiernan & Dubrow (2005) 133 Cal.App.4th 1090, 1103 [restitution is appropriate remedy for violation of automatic § 2040 restraining order]; In re Marriage of Mix (1975) 14 Cal.3d 604, 614 [testimony of single witness is sufficient to support a factual finding].)

III. Disposition

The February 2, 2016 judgment is affirmed. Husband shall bear Wife’s costs on appeal.

_________________________

BRUINIERS, J.

WE CONCUR:

_________________________

JONES, P. J.

_________________________

SIMONS, J.

A147796