Opinion
H042214
12-21-2018
In re the Marriage of MARGARET L. and DAVID E. CRITZER. MARGARET L. CRITZER, Respondent, v. DAVID E. CRITZER, Appellant.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Santa Clara County Super. Ct. No. FL011468)
David E. Critzer appeals from a status-only judgment of dissolution of his marriage to Margaret L. Critzer. The judgment followed a contested hearing ending on February 3, 2015. The judgment reserved jurisdiction over all other issues, and it incorporated (1) an order granting bifurcation and a separate trial on marital status with certain conditions and (2) a provisional award of retirement benefits. The status-only judgment was entered "nunc pro tunc" as of December 31, 2014.
In the interest of clarity, we refer to the parties by their first names.
On appeal, David challenges the grant of bifurcation and status-only judgment on multiple grounds. He argues that the trial court "failed to conclusively obtain jurisdiction" over Margaret's KPMG deferred compensation plan. David further maintains that the trial court erred in granting bifurcation by failing to (1) impose an indemnification condition as to the benefits under all of Margaret's KPMG retirement plans, (2) ensure that its provisional award of a separate one-half interest in Margaret's five ERISA-qualified plans constituted a qualified domestic relations order (QDRO), and (3) impose an indemnification condition that protected the community right to elect coverage under Margaret's KPMG health plan. Lastly, David contends that the trial court erred by entering the judgment nunc pro tunc.
The appellant's opening brief was prepared by David in pro per. The appellant's reply brief was prepared by counsel.
"The Employee Retirement Income Security Act of 1974 (ERISA), 88 Stat. 829, 29 U.S.C. § 1001 et seq., generally obligates administrators to manage ERISA plans 'in accordance with the documents and instruments governing' them. § 1104(a)(1)(D). At a more specific level, the Act requires covered pension benefit plans to 'provide that benefits . . . under the plan may not be assigned or alienated,' § 1056(d)(1), but this bar does not apply to qualified domestic relations orders (QDROs), § 1056(d)(3)." (Kennedy v. Plan Adm'r for DuPont Sav. and Inv. Plan (2009) 555 U.S. 285, 288.) A QDRO must specify "(i) the name and the last known mailing address (if any) of the participant and the name and mailing address of each alternate payee covered by the order, [¶] (ii) the amount or percentage of the participant's benefits to be paid by the plan to each such alternate payee, or the manner in which such amount or percentage is to be determined, [¶] (iii) the number of payments or period to which such order applies, and [¶] (iv) each plan to which such order applies." (29 U.S.C. § 1056(d)(3)(C).) "Although a judgment in a marital dissolution proceeding may award a community interest in benefits under a nonqualified plan to the nonemployee spouse, federal law has not clarified whether QDRO status is required for a state law award of benefits to be enforceable in the face of ERISA's broad preemption provisions." (Dividing Pensions and Other Employee Benefits in California Divorces (Cont. Ed. Bar 2018) Nonqualified Deferred Compensation Plans, § 10.16.)
We conclude that the trial court had no authority to enter the status-only judgment nunc pro tunc, but we otherwise find no reversible error. Accordingly, we modify the judgment's date of entry and, as modified, affirm.
I
Procedural History
On November 19, 2013, Margaret petitioned for dissolution of marriage.
As to five KPMG retirement plans, Margaret requested and obtained orders of joinder, filed pleadings on joinder, and served summonses.
On September 12, 2014, Margaret filed a request for bifurcation and an early and separate trial on marital status (Judicial Counsel form FL-315 [Rev. July 1, 2012]) (form FL-315) and dissolution of the status of marriage. In support of her request for an order, Margaret stated that she was a participant in five retirement plans through KPMG, her former employer, that the benefits were entirely community property, and that the five plans had been joined to the proceedings. On form FL-315, Margaret requested a number of conditions relating to bifurcation, including the standard indemnification and hold harmless conditions as to existing health and medical insurance coverage and retirement benefits and a special condition requiring her to "maintain existing dental and eye care insurance coverage as long as she is eligible to do so" and, if ineligible, to provide substitute coverage "at her sole expense."
An acknowledgement of receipt was filed as to each of the five KPMG retirement plans that were joined. A notice of appearance and response was filed for each of them on October 3, 2014, and appearances were entered for the KPMG Personal Account for Retirement Plan, the KPMG Partner Pension Plan, the KPMG Pension Plan, the KPMG 401(k) Plan, and the KPMG Partner Retirement Savings Plan.
On November 26, 2014, David filed a declaration and a response to Margaret's request for bifurcation and separate trial (form FL-315). On form FL-315, David requested that the court impose 10 conditions on any bifurcation, including the standard indemnification and hold harmless conditions as to health and medical insurance coverage and retirement benefits and several special conditions. One of the special conditions requested by David concerned the KPMG health insurance plan, and it provided that he would "have the opportunity to obtain and review the cost and coverage information for both the KPMG plan and the current Anthem Blue Cross plans for 2015 to make a decision about which one offers a better price and/or better coverage [and] to opt into the KPMG coverage before marital status is terminated if he decides to do so." Another special condition requested by David was a catch-all indemnification condition that required Margaret to indemnify him for "any other adverse consequences of the early termination of marital status" and any attorney fees incurred to enforce the condition.
In a separate declaration in opposition to bifurcation and early termination of marital status, David explained that Margaret as a retiree had a one-time election, not yet exercised, to opt into the KPMG health plan (on behalf of herself and her spouse) during any open enrollment period and that he would lose that benefit upon marital dissolution. He stated that it was currently KPMG's open enrollment period for 2015 and that he wanted "the opportunity to obtain and review the cost and coverage information for both the KPMG and [their] current . . . plans for 2015" and "the opportunity to opt into the KPMG coverage before marital status [was] terminated if [he] decided to do so." It was his understanding that if he elected health coverage through KPMG, he would have the "option to continue the coverage under COBRA once the marital status [was] terminated, if [he made] the election by the end of 2014." David alternatively asked the court to condition bifurcation on a requirement that Margaret indemnify him "for the costs of comparable insurance coverage." David also requested that three additional retirement plans (specifically, a Fidelity 401(k) plan, the KPMG long-term deferred compensation plan, and the KPMG Retirement Allowance Plan (RAP)) be joined to the proceedings before the parties' marital status was terminated.
Margaret filed a declaration in support of her bifurcation request. She stated that she did not presently want to exercise her option to enroll in the KPMG health plan, and it was her belief that David could not separately opt in without her. She indicated that five ERISA-qualified retirement plans, which were named, had been joined to the proceedings. She stated that she did not participate in the KPMG RAP and that while she was a participant in the KPMG Partner Long Term Compensation Plan (KPMG LTCP), it was an unfunded, nonqualified plan. The brochure attached to her declaration explained the KPMG LTCP as it had been proposed.
The brochure attached to Margaret's December 3, 2014 declaration stated in part: "The LTCP is a 'pay-as-you-go' program. Payments to former partners entitled to LTCP benefits will be paid from the distributable income of the partnership at the time payments become due. The LTCP is not funded currently, so there are no trust or plan assets." The document also indicated that the proposed plan, if approved by the partnership, "may be amended from time to time."
On December 9, 2014, a hearing was commenced on Margaret's motion for bifurcation of trial on marital status. David's counsel complained that two retirement plans had not been joined, David's Fidelity 401(k) plan and Margaret's nonqualified deferred compensation plan. Margaret's counsel represented that she had joined David's Fidelity 401(k) plan. She described the KPMG LTCP as an unfunded, nonqualified plan under which KPMG promised to pay a stream of income over 121 months upon retirement or the age of 58. Margaret's counsel disputed that the KPMG LTCP had to be joined pursuant to Family Code section 2337, and David's counsel objected to bifurcation without joinder of that plan.
All further statutory references are to the Family Code unless otherwise indicated.
The other bone of contention at the hearing was Margaret's one-time option as a retiree to enroll in KPMG's group health plan. At that time the parties were insured by KPMG's dental and vision plans, but otherwise each had an individual health insurance policy. Margaret's counsel told the court that Margaret was willing to maintain dental and vision insurance coverage for David at her cost. Margaret told the court that she had learned from KPMG that David could not opt into its health insurance plan without her.
David's counsel explained that David, who was an insurance broker, wanted to compare the cost of opting into the KPMG health plan with the cost of obtaining insurance coverage on the open market. It was his counsel's understanding that the rates for 2015 were going to be available in January 2015 and no comparison could be made until then. Margaret's counsel asserted that Margaret would be economically damaged if bifurcation were denied and she could not file an income tax return for 2014 as a single person.
The court responded: "Okay, so, here's what we're going to do, folks, I'm going to continue this into the early part of February with the express reservation of doing a nunc pro tunc back to December 31st of this year [for] termination of marital status. What that means, folks, is I'm reserving the right to go back and have the marriage end this year, which the Court does have the power to do." The hearing was continued to February 3, 2015.
As to David's self-employed 401(k) plan and the KPMG LTCP, Margaret requested and obtained orders of joinder, filed pleadings on joinder, and served summonses. A notice and acknowledgement of receipt from the KPMG LTCP was filed.
On February 3, 2015, the hearing continued before a different judge. Margaret's counsel recapped the situation that Margaret was a former partner at KPMG and that she had a number of ERISA-qualified pension plans and a nonqualified long-term compensation plan from KPMG. Her counsel explained that the KPMG LTCP was "an unfunded obligation . . . to pay a monthly amount for ten years" after her retirement and upon reaching a certain age and that Margaret was retired but about ten years away from receiving that benefit. Her counsel told the court that the KPMG LTCP had been joined to the proceedings.
Margaret's counsel disclosed, however, that the attorney for KPMG's deferred compensation plan had requested that she "withdraw the joinder." She agreed that David needed some "protections" as to that plan. When the court inquired whether she was referring to an indemnification and hold harmless condition, Margaret's counsel agreed that the plan was part of the community and her client was willing to accept "[w]hatever protections [David] fe[lt] he need[ed] on this plan[,] whether it's a hold harmless or . . . anything else . . . ."
David's counsel maintained that a procedural prerequisite to bifurcation was joinder of the KPMG LTCP. According to Margaret's counsel, KPMG believed that the plan was not subject to the joinder requirement because it was not "ERISA qualified." The court repeatedly asked why an indemnification and hold harmless condition would not solve any joinder issue. But the court did not explicitly state that it would include such condition pertaining to the KPMG LTCP in its bifurcation order.
Also unresolved was Margaret's one-time election as a retiree to opt into the KPMG health plan. Margaret's counsel told the court that Margaret did not maintain health insurance for David and that "by stipulation the community property pays the insurances for both parties." It was not disputed that Margaret was willing to continue providing vision and dental insurance coverage for David. David's counsel opposed bifurcation because termination of marital status would end the possibility of David opting into the KPMG health plan. David's counsel stated that David wanted to preserve the ability "to exercise that option as long as humanly possible."
David's counsel requested an indemnification and hold harmless condition, "without any qualifications," as to health insurance. The court stated that it thought "the appropriate solution" was "to reserve the issue of indemnification of health expenses beyond the eye and dental coverage . . . ."
David's counsel also requested an order immediately awarding a half interest in Margaret's IRA, and Margaret's counsel indicated that her client would be happy to divide all the IRA's. The court remarked that it sounded like "that's stipulated" and that the order was certainly appropriate.
Lastly, David's counsel asked for a catch-all indemnification and hold harmless condition on bifurcation. Margaret's counsel indicated that she could not agree to a condition that broad, but she had "no objection to reserving the issue for a later determination."
Throughout the hearing, the trial court tried to ascertain where the parties agreed regarding conditions on bifurcation. At the end of the hearing on February 3, 2015, the court sent the parties out into the hallway to prepare a judgment, telling them to come back if there were any points of disagreement to resolve.
The judge hearing the matter on February 3, 2015 apparently later signed the status-only judgment of dissolution in the hallway. As indicated, the judgment incorporated (1) the grant of bifurcation with certain conditions and (2) a provisional award of retirement benefits under any retirement plan, including the KPMG LTCP and other plans listed.
The provision award (form FL-348) was made "without prejudice, and subject to adjustment by a later domestic relations order," and it granted "a separate interest equal to one-half of all benefits accrued or to be accrued under any retirement plan in which one party has accrued a benefit, including but not limited to the plans listed below, as a result of employment of the other party during marriage . . . and before the date of separation. In addition, pending further notice, the plan must, as allowed by law, or as allowed by the terms of the plan in the case of a governmental plan, continue to treat the parties as married persons . . . for purposes of any survivor rights and benefits available under the plan to the extent necessary to provide for payment to the surviving spouse . . . of an amount equal to that separate interest or of all survivor benefits if at the time of death of the participant there is no other eligible recipient of the survivor benefit." The KPMG LTCP was among the plans listed.
The KPMG LTCP's notice of appearance and response was filed on February 9, 2015. It entered the plan's appearance. The plan's response to the pleading on joinder stated that the pleading's allegations were incorrect, and the plan denied "the truth of allegations in paragraphs 4 and 5" (dates of marriage and separation) based on insufficient knowledge or information. Its response further asserted that "[p]etitioner fails to state a claim on which relief may be granted in that she seeks an order directing Claimant, a non-qualified plan under ERISA, to make payments to nonemployee spouse of said spouse's interest in employee's benefits under the plan when they become payable to employee."
By order filed February 24, 2016, the court corrected the status-only judgment to include two provisions: "a. The Court shall reserve jurisdiction over any other adverse consequences of the early termination of marital status (e.g. but not limited to, tax liability for 2014—due to cash disbursements or additional run out or ongoing income from KPMG, additional taxes incurred due to sale of an asset after Petitioner's death due to a loss in 'step up' of basis for capital gains purposes, any additional tax liability from previously filed joint tax returns that is later determined owing to California Franchise Tax Board of the Dept. of Treasury/lRS by either taxing entity, including additional taxes either taxing entity determines are due as a result of Wife's disposition of her partnership interest in KPMG, LLP in 2013 or any loss of rights under CA Probate Code Sections 100 through 104 and 120 in the event of her death and the early termination of marriage), as well as attorney's fees incurred to enforce this provision. [¶] b. The Court shall reserve jurisdiction over the issue of indemnification of health expenses beyond the eye and dental coverage that Petitioner agrees to."
We take judicial notice of the judgment on the reserved issues filed on January 12, 2018. (Evid. Code, §§ 452, subd. (d); 459.) The judgment on reserved issues confirmed to David, among other interests, a "[o]ne-half interest in [five KPMG] retirement accounts to be divided equally and in kind pursuant to Qualified Domestic Relations Order ('QDRO') or other Domestic Relations Order ('DRO') to be prepared by Elizabeth Strassen." It also stated that "[t]he parties shall retain Elizabeth Strassen to prepare . . . Qualified Domestic Relations Orders to divide equally and in-kind the community property interests in [those] retirement accounts" and that "[f]or purposes of this division, the community property period is defined as May 3, 1986 through October 11, 2014."
Respondent's request for judicial notice is otherwise denied.
The judgment on reserved issues also provided the following as to the KPMG LTCP: "Margaret is a participant in the KPMG [LTCP] by virtue of her previous employment as a partner with KPMG. The parties agree and the Court finds that the KPMG LTCP is entirely community property and the benefit and tax consequences shall be divided equally and in kind by the parties. The parties acknowledge there may be some difficulty effecting an equal division of the KPMG LTCP. The parties shall retain James Crawford as an Evidence Code Section 730 court appointed expert to do two things. [¶] (a) Preliminarily, he will review documentation regarding the KPMG LTCP, including but not limited to Margaret's KPMG partnership agreement, if it can be located, the 'white paper' and the 'brochure.' There is a question about whether there's more documentation, and Mr. Crawford may help the parties get more. [¶] (b) Second, Mr. Crawford shall contact KPMG, presumably by letter, to ask them why they are not willing to accept a Domestic Relations Order ('DRO') and request their reasoning. Mr. Crawford might also provide his reasoning for why KPMG should accept a DRO. [¶] After Mr. Crawford completes his assignment, he shall report back to the parties and/or their counsel. At that point, the parties shall meet and confer to decide whether they should pursue a DRO or whether to go in a different direction. One possible alternative proposed by Mr. Crawford is that the court could issue an order wherein KPMG would pay the LTCP benefit to Margaret and Margaret would, in turn, pay David's one-half interest with all the tax ramifications and other issues that would come along with that. [¶] The parties acknowledge that a DRO is the preferable method to divide the KPMG LTCP but it may be too difficult or expensive due to KPMG's unwillingness to accept a DRO. The court shall reserve jurisdiction over the KPMG LTCP. The court shall make any necessary orders based on a stipulation with respect to the assignment of Mr. Crawford. The court shall also make itself available for further proceedings if necessary regarding the KPMG LTCP."
II
Discussion
A. General Principles of Appellate Review
As the Supreme Court has stated, " 'A judgment or order of the lower court is presumed correct. All intendments and presumptions are indulged to support it on matters as to which the record is silent, and error must be affirmatively shown. This is not only a general principle of appellate practice but an ingredient of the constitutional doctrine of reversible error.' [Citations.]" (Denham v. Superior Court (1970) 2 Cal.3d 557, 564 (Denham); see Cal. Const., art. VI, § 13.)
In addition, generally, where a matter is addressed to the trial court's discretion, " '[t]he burden is on the party complaining to establish an abuse of discretion, and unless a clear case of abuse is shown and unless there has been a miscarriage of justice a reviewing court will not substitute its opinion and thereby divest the trial court of its discretionary power.' [Citations.]" (Denham, supra, 2 Cal.3d at p. 566.) The standard of review of an alleged abuse of discretion is deferential. (People v. Williams (1998) 17 Cal.4th 148, 162; see Stull v. Sparrow (2001) 92 Cal.App.4th 860, 864.) "The appropriate test for abuse of discretion is whether the trial court exceeded the bounds of reason." (Shamblin v. Brattain (1988) 44 Cal.3d 474, 478.) "A ruling that constitutes an abuse of discretion has been described as one that is 'so irrational or arbitrary that no reasonable person could agree with it.' [Citation.]" (Sargon Enterprises, Inc. v. University of Southern California (2012) 55 Cal.4th 747, 773.) "A merely debatable ruling cannot be deemed an abuse of discretion. [Citations.]" (People v. Bryant, Smith and Wheeler (2014) 60 Cal.4th 335, 390.) B. Joinder of the KPMG Deferred Compensation Plan
Section 2060, subdivision (b), states that "[a]n order or judgment in the proceeding is not enforceable against an employee benefit plan unless the plan has been joined as a party to the proceeding." Section 2337, subdivision (d), states in part: "Prior to, or simultaneously with, entry of judgment granting dissolution of the status of the marriage, all of the following shall occur: [¶] (1) The party's retirement or pension plan shall be joined as a party to the proceeding for dissolution, unless joinder is precluded or made unnecessary by Title 1 of the federal Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.), as amended (ERISA), or any other applicable law."
"Notwithstanding [section] 2060, however, it is not essential to join either party's ERISA-governed pension plan for purposes of adjudicating community property interests in the plan or ordering payment from the plan to effect a property division. Under federal law, the court's order is enforceable against the plan so long as it satisfies federal QDRO . . . requirements . . . . [Citations.]" (Hogoboom and King, California Practice Guide: Family Law (The Rutter Group 2018) ¶ 3:444, p. 3-160; see 29 U.S.C. §§ 1056(d)(3), 1144; In re Marriage of Baker (1988) 204 Cal.App.3d 206, 217-218 (Marriage of Baker).)
In addition, section 2337, subdivision (d)(2), provides that in order to preserve the claims of each spouse in retirement plan benefits, the trial court must enter one of the following orders prior to, or simultaneously with, entry of a status-only judgment of dissolution: "[a]n order pursuant to Section 2610 disposing of each party's interest in retirement plan benefits, including survivor and death benefits" (§ 2337, subd. (d)(2)(A); "[a]n interim order preserving the nonemployee party's right to retirement plan benefits, including survivor and death benefits, pending entry of judgment on all remaining issues" (§ 2337, subd. (d)(2)(B); or an attachment to the status-only judgment provisionally awarding a separate half-interest in all retirement benefits to each party, using specified language (§ 2337, subd. (d)(2)(C)).
Section 2337, subdivision (d)(2)(C), provides the following language: "EACH PARTY (insert names and addresses) IS PROVISIONALLY AWARDED WITHOUT PREJUDICE AND SUBJECT TO ADJUSTMENT BY A SUBSEQUENT DOMESTIC RELATIONS ORDER, A SEPARATE INTEREST EQUAL TO ONE-HALF OF ALL BENEFITS ACCRUED OR TO BE ACCRUED UNDER THE PLAN (name each plan individually) AS A RESULT OF EMPLOYMENT OF THE OTHER PARTY DURING THE MARRIAGE OR DOMESTIC PARTNERSHIP AND PRIOR TO THE DATE OF SEPARATION. IN ADDITION, PENDING FURTHER NOTICE, THE PLAN SHALL, AS ALLOWED BY LAW, OR IN THE CASE OF A GOVERNMENTAL PLAN, AS ALLOWED BY THE TERMS OF THE PLAN, CONTINUE TO TREAT THE PARTIES AS MARRIED OR DOMESTIC PARTNERS FOR PURPOSES OF ANY SURVIVOR RIGHTS OR BENEFITS AVAILABLE UNDER THE PLAN TO THE EXTENT NECESSARY TO PROVIDE FOR PAYMENT OF AN AMOUNT EQUAL TO THAT SEPARATE INTEREST OR FOR ALL OF THE SURVIVOR BENEFIT IF AT THE TIME OF THE DEATH OF THE PARTICIPANT, THERE IS NO OTHER ELIGIBLE RECIPIENT OF THE SURVIVOR BENEFIT."
David asserts that the KPMG LTCP plan was required to be joined under section 2337, subdivision (d)(1). As indicated, there was an order of joinder joining the KPMG LTCP as a party claimant to the dissolution proceeding before the trial court granted bifurcation and entered a status-only judgment of dissolution. (See § 2060, subd. (a).) In addition, the court's status-only judgment did incorporate the provisional award specified by section 2337, subdivision (d)(2)(C), which applied to all retirement plans, including but not limited to the KPMG LTCP and the others listed. David has not established any violation of section 2337, subdivision (d).
Nevertheless, David argues that the trial court failed to "conclusively" obtain jurisdiction over the KPMG deferred compensation plan. He fails to explain what he means by the word "conclusively." He appears concerned by the plan's response to the pleading on joinder. He urges this court to "review de novo whether the joinder of the KPMG LTCP by itself at the time of the bifurcation was adequate for the court to have jurisdiction to issue enforceable orders to the plan since [his] rights are . . . severely prejudiced in the event the joinder was not adequate."
As indicated, after the order of joinder, a notice of appearance and response for the KPMG LTCP was filed. It does not appear from the record before us that the plan filed a motion to quash service. (See Code Civ. Proc., § 418.10.) Thus, the joinder was complete. Any error in granting bifurcation and entering a status-only judgment before the plan entered an appearance was harmless. Furthermore, the issue whether the plan would comply with the court's orders was entirely separate from the issue of joinder. David has not shown that joinder of the KPMG LTCP was defective or that the trial court lacked jurisdiction over the plan.
"[F]ederal law does not preempt state court action dividing marital interests in employee benefit plans" (Marriage of Baker, supra, 204 Cal.App.3d at p. 209) and "does not preempt California's statutory provisions . . . for joinder of the plan as a party in a dissolution action." (Id. at pp. 209-210.)
David also contends, without any citation of authority, that the plan is "not a separate entity that can sue or be sued as an ERISA-governed plan would be under Section 502 of ERISA" (fn. omitted) and that "it is likely the partnership of KPMG itself would need to be joined to the proceeding to obtain any relief against the plan." He asserts that "as a matter of law, . . . the KPMG partnership itself might need to be joined as an indispensable party . . . in order to issue enforceable orders to the plan" because the plan had asked for the withdrawal of the request for joinder, the plan was unfunded, and any benefits under the plan would be paid from the distributable income of the partnership at the time payments became due.
David cites no legal authority to support a claim that the trial court erred or abused its discretion in granting bifurcation and a status-only judgment of dissolution without first requiring the KPMG partnership to be joined as an indispensable party. Also, without any citation to legal authority, David argues that the trial court abused its discretion by failing "to examine the effectiveness of the . . . joinder" of the KPMG LTCP. None of those objections was specifically raised before the trial court, and consequently they were not preserved for appellate review. (See In re Marriage of Nelson (2006) 139 Cal.App.4th 1546, 1558; People v. Saunders (1993) 5 Cal.4th 580, 589-590.) Moreover, such conclusory arguments are deemed forfeited because they are unaccompanied by legal analysis and citation to supporting legal authority. (See People v. Stanley (1995) 10 Cal.4th 764, 793 (Stanley); Cal. Rules of Court, rule 8.204(a)(1)(B) & (C).) C. Indemnification and Hold Harmless Condition Regarding Retirement Benefits
All further references to rules are to the California Rules of Court.
Section 2337, subdivision (a), provides that "[i]n a proceeding for dissolution of marriage, the court, upon noticed motion, may sever and grant an early and separate trial on the issue of the dissolution of the status of the marriage apart from other issues." Subdivision (c) of section 2337 provides that "[t]he court may impose upon a party any of [the specified] conditions on granting a severance of the issue of the dissolution of the status of the marriage, and in case of that party's death, an order of any of [those] conditions continues to be binding upon that party's estate . . . ." (Italics added.)
The indemnification and hold harmless condition set forth in subdivision (c)(5) of section 2337 states: "Until judgment has been entered on all remaining issues and has become final, the party shall indemnify and hold the other party harmless from any adverse consequences to the other party if the bifurcation results in the loss of the other party's rights with respect to any retirement, survivor, or deferred compensation benefits under any plan, fund, or arrangement, or to any elections or options associated therewith, to the extent that the other party would have been entitled to those benefits or elections as the spouse or surviving spouse of the party." In addition, section 2337 provides that under specified circumstances, the trial court may issue an order facilitating the enforcement of community property rights. (§ 2337, subd. (c)(9), italics added.) The court may also impose "[a]ny other condition the court determines is just and equitable." (§ 2337, subd. (c)(10).)
Form FL-315 is used to request a separate trial or to respond to a request for a separate trial on dissolution of the status of marriage. Both parties requested, by the checking of a box (paragraph 4.b.(5)), that the court condition any grant of bifurcation on an indemnification and hold harmless condition as to retirement benefits. Although form FL-347 (grant of bifurcation) also included a standard indemnification and hold harmless condition as to retirement benefits (paragraph 5.e.), the condition excepted "any retirement plan, fund, or arrangement identified in any order issued and attached as set out in paragraph 3" of the form. Thus, all of the KPMG retirement plans that were identified in the court's provisional award, including the KPMG LTCP, were excepted from form FL-347's indemnification and hold harmless condition as to retirement benefits.
The requested condition stated: "Until a judgment has been entered and filed on all remaining issues, the [petitioner] must indemnify and hold me harmless from any adverse consequences if the bifurcation results in the loss of my rights with respect to any retirement, survivor, or deferred compensation benefits under any plan, fund, or arrangement, or to any elections or options associated [with] those benefits, to the extent that I would have been entitled to those benefits or elections as the spouse or surviving spouse . . . ."
Paragraph 3 of form FL-347 indicated that the court was making one of the following three with respect to named retirement plans: (1) a final domestic relations order or qualified domestic relations order disposing of the party's interest in retirement plan benefits, (2) an interim order preserving the nonemployee party's rights to retirement plan benefits pending entry of judgment on all remaining issues, or (3) a provisional award to each party of a one-half interest in all retirement benefits attributable to employment during the marriage (form FL-348). The court made a provisional award using form FL-348.
David asserts that by using form FL-347, rather than form FL-315, to bifurcate the trial, the status-only judgment "eliminated the standard protective indemnification clause regarding retirement benefits" to which the parties had agreed and to which the court had referred at the hearing. David has not provided any authority showing that the mere request of an indemnification and hold harmless condition as to retirement benefits, even if by both parties, establishes a legal entitlement to the condition as set forth in form FL-315.
David argues that form FL-347 failed to comply with section 2337, subdivision (c)(5), since the form's indemnification and hold harmless condition as to retirement benefits "exclude[d] all retirement plans [subject to] an order per [section] 2337(d)(2) . . . ." He also contends that by doing so, the court improperly rendered form FL-347's indemnification and hold harmless condition as to retirement benefits mere surplusage.
David, who was represented by counsel below, is now arguing on appeal that he never saw the final FL-347, that his trial counsel "never saw the final form" of the status-only judgment, and that the parties' attorneys erroneously "assumed that the hold harmless clause in [form] FL-347 would apply to all retiree plans." He implies that the attorneys were unaware of the exception contained in paragraph 5.e. of that form. Any failure or omission of counsel does not provide a basis for reversing the judgment on appeal. (See In re Marriage of Campi (2013) 212 CA4th 1565, 1574-1575 [no general due process right to effective assistance of counsel in dissolution proceedings].)
First, nothing in section 2337 mandates that the trial court impose the indemnification and hold harmless condition regarding retirement benefits set forth in subdivision (c)(5) of that section. Rather, the statute expressly makes imposition discretionary. (§ 2337, subd. (c) ["The court may impose. . ."]; see § 12 [" 'Shall' is mandatory and 'may' is permissive"].)
Second, as to the retirement plans excepted from the indemnification and hold harmless condition, the trial court provisionally awarded each party a separate one-half interest in all retirement benefits consistent with the requirements of section 2337, subdivision (d)(2)(C). (See ante, fn. 9.) David has not demonstrated by citation of authority that bifurcation constituted an abuse of discretion under the foregoing circumstance. We also note that the court sought to doubly protect David's interest in the KPMG LTCP. In addition to the provisional award of benefits (form FL-348), the court expressly awarded to David "50 % of the community property interest" in the KPMG LTCP "[t]o ensure [his] interest in the [plan] after [Margaret's] death."
Third, the grant of bifurcation's indemnification and hold harmless condition as to retirement benefits was not surplusage because it applied to any omitted retirement plans.
Fourth, the trial court did not rule that David was entitled to an indemnification and hold harmless condition. The trial court merely inquired about an indemnification and hold harmless condition in the context of the parties' argument about joinder of the KPMG LTCP. In any event, "[c]omments made by the trial court are not rulings to be reviewed on appeal. (Whyte v. Schlage Lock Co. (2002) 101 Cal.App.4th 1443, 1451.)" (Marich v. MGM/UA Telecommunications, Inc. (2003) 113 Cal.App.4th 415, 431.)
Even assuming the KPMG LTCP was unfunded and not qualified under ERISA, David has failed to provide legal authority supporting the conclusion that the trial court committed reversible error or abused its discretion in granting bifurcation and an early separate trial on dissolution of marital status where there was an order joining the KPMG LTCP to the proceedings and the trial court provisionally awarded David a separate one-half interest in the plan's benefits. Although David asserts that the award of his separate interest in the plan benefits was insufficient to protect him and that the trial court was required by law to impose an indemnification and hold harmless condition as well, he has cited no legal authority for that assertion. Without any citation to authority or the record on appeal, David further argues that it is "highly likely" that the provisional award is "unenforceable against the plan" because the "position [of the KPMG LTCP] is that the plan will not accept a domestic relations order to divide its benefit[s] and because the plan is also unfunded, with no trust or assets." In addition, without any citation to legal authority or the record, David asserts that "the trial court's refusal to order any specific catch-all indemnification [condition] for any adverse consequence [to him] stemming from the bifurcation . . . was based entirely or in part on the legal error that there would be a separate protective indemnification provision in place regarding retirement plan loss of rights," and it should be reviewed de novo by this court. In the absence of reasoned legal argument supported by adequate citation, we treat the foregoing arguments as forfeited. (See Stanley, supra, 10 Cal.4th at p. 793; rule 8.204(a)(1)(B) & (C).) D. Provisional Award of Separate Half-Interest in ERISA-Governed Plans
David argues that the provisional award to each party of a separate one-half interest in all retirement benefits was not a QDRO and that the award would not protect him in the long term. He asserts that the provisional award "faces ERISA preemption and will likely not be 'qualified' as a QDRO by the plan administrators for the five ERISA plans . . . ." He states that "[w]hile some plan administrators might qualify the provisional order as a QDRO, many would not." He notes the 18-month period specified in United States Code, title 29, section 1056, subdivision (d)(3)(H), which concerns ERISA-governed plans.
That statutory provision states: "(i) During any period in which the issue of whether a domestic relations order is a qualified domestic relations order is being determined (by the plan administrator, by a court of competent jurisdiction, or otherwise), the plan administrator shall separately account for the amounts (hereinafter in this subparagraph referred to as the 'segregated amounts') which would have been payable to the alternate payee during such period if the order had been determined to be a qualified domestic relations order. [¶] (ii) If within the 18-month period described in clause (v) the order (or modification thereof) is determined to be a qualified domestic relations order, the plan administrator shall pay the segregated amounts (including any interest thereon) to the person or persons entitled thereto. [¶] (iii) If within the 18-month period described in clause (v)—[¶] (I) it is determined that the order is not a qualified domestic relations order, or [¶] (II) the issue as to whether such order is a qualified domestic relations order is not resolved, then the plan administrator shall pay the segregated amounts (including any interest thereon) to the person or persons who would have been entitled to such amounts if there had been no order. [¶] (iv) Any determination that an order is a qualified domestic relations order which is made after the close of the 18-month period described in clause (v) shall be applied prospectively only. [¶] (v) For purposes of this subparagraph, the 18-month period described in this clause is the 18-month period beginning with the date on which the first payment would be required to be made under the domestic relations order." (29 U.S.C. § 1056(d)(3)(H), italics added.)
The standard language of the provisional award set forth in form FL-348 (which was incorporated into the status-only judgment) substantially conforms to the language required by section 2337, subdivision (d)(2)(C). (See ante, fns. 6, 9.) David does not show by citation to the record that he objected in the trial court to the standard provisional award of retirement benefits (form FL-348) on the ground that it did not constitute a QDRO or was insufficient to protect his interests because a plan might not comply with it. On appeal, he does not establish by any citation of authority that the provisional order was not a QDRO or that the trial court was prohibited from granting bifurcation and entering a status-only judgment unless that provisional award qualified as a QDRO and would be honored by plan administrators. David also claims, again without any citation of authority, that the provisional order is legally deficient in a number of ways, including because it "does not award any gains or losses in investment value, or change in benefits or subsides [sic] . . . and thus is not adequate to preserve [his] full interest in the KPMG retirement plans." All the foregoing unsupported contentions were forfeited. (See Keener v. Jeld-Wen, Inc. (2009) 46 Cal.4th 247, 264-265; Stanley, supra, 10 Cal.4th at p. 793; rule 8.204(a)(1)(B) & (C).) E. The KPMG Health Plan
We nevertheless note that the order provisionally awarded "a separate interest equal to one-half of all benefits accrued or to be accrued under any retirement plan . . . ." (Italics added.) It clearly indicated the percentage of the participant's benefits to be paid by a plan to each of the parties -- 50 percent ("a separate interest equal to one-half of all benefits") or 100 percent ("all of the survivor benefits") in the event the plan participant died and there was no other eligible recipient. In addition, the award listed the known retirement plans to which the order applied, the dates of marriage and separation, and the addresses of each party. (See 29 U.S.C. § 1056(d)(3)(C).)
David asserts that "[b]y granting the early termination of status, the court terminated [his] right to elect . . . the retiree medical coverage from [Margaret's] former employer, KPMG, despite the requirement in [section] 2337 to maintain all options existing in any plan, fund, or program."
At the hearing, Margaret's counsel told the court that Margaret did not maintain general health insurance for David and that their coverage was being paid from community funds pursuant to the parties' stipulation. As a retired partner of KPMG, Margaret did have "the option at some point in the future to opt into the KPMG plan."
David is not claiming, and the record does not indicate, that either party was obtaining general health and medical insurance coverage through KPMG at the time the matter was being heard. Although the hearing was continued until February 2015 in part to allow David to compare coverages offered by the KPMG health plan and his existing provider and determine whether he wanted to participate in the KPMG health plan for 2015, neither David nor his counsel asserted on February 3, 2015 that he wished to avail himself of that option at that time. David's concern was that he would be unable to elect health insurance coverage through KPMG after bifurcation. David's wish, as expressed by counsel, was to preserve the option to get health insurance coverage through KPMG "as long as humanly possible. . . ." His counsel also argued that the option to elect health insurance coverage through KPMG was "a community property right."
Section 2337, subdivision (c)(2), concerns only existing health and medical insurance coverage. The trial court made the following order as to such coverage: "Until judgment is entered on the remaining issues, [Margaret] will maintain all existing dental and eye insurance coverage for [David] as long as she is eligible to do so. If a[t] any time during the period, she is unable to maintain that coverage, she will at her sole expense, provide and maintain substitute dental and eye insurance coverage for [David]." David does not argue that that this order was inadequate to protect the dental and vision insurance coverages then being maintained by Margaret.
Under section 2337, subdivision (c)(2), the trial court may impose the following condition when granting bifurcation: "Until judgment has been entered on all remaining issues and has become final, the party shall maintain all existing health and medical insurance coverage for the other party and any minor children as named dependents, so long as the party is eligible to do so. If at any time during this period the party is not eligible to maintain that coverage, the party shall, at the party's sole expense, provide and maintain health and medical insurance coverage that is comparable to the existing health and medical insurance coverage to the extent it is available. To the extent that coverage is not available, the party shall be responsible to pay, and shall demonstrate to the court's satisfaction the ability to pay, for the health and medical care for the other party and the minor children, to the extent that care would have been covered by the existing insurance coverage but for the dissolution of marital status, and shall otherwise indemnify and hold the other party harmless from any adverse consequences resulting from the loss or reduction of the existing coverage. For purposes of this subdivision, 'health and medical insurance coverage' includes any coverage for which the parties are eligible under any group or individual health or other medical plan, fund, policy, or program." (Italics added.)
David's grievance is that Margaret "continues to enjoy the financial security the KPMG retiree health plan provides," whereas he "lost that security as a result of the bifurcation." Defendant argues that the condition regarding health and medical insurance coverage set forth in section 2337, subdivision (c)(2), "should have been applied to maintain [his] right to elect the insurance rather than terminating the right through bifurcation . . . ." As indicated, this statutory provision applies to existing coverage and requires a spouse to "indemnify and hold the other party harmless from any adverse consequences resulting from the loss or reduction of the existing coverage." (§ 2337, subd. (c)(2), italics added.) This statutory provision was inapplicable to the one-time option as a retiree to elect coverage under the KPMG health plan since the election had not yet been exercised and David was not then obtaining his general health and medical insurance coverage through KPMG.
Insofar as David may be arguing that the trial court erred or abused its discretion by granting bifurcation and a status-only judgment of dissolution when he wished to prolong the possibility of opting into the KPMG health plan by delaying dissolution of the marriage for as long as he could, he fails to cite any legal authority in support of such argument. Accordingly, any such contention is deemed forfeited. (See Stanley, supra, 10 Cal.4th at p.793; rule 8.204(a)(1)(B) & (C).) Moreover, the speculative benefit of such an option, where the future cost of health and medical insurance coverage under the company's plan and alternative plans could not be known, did not warrant a denial of bifurcation.
In any case, the status-only judgment reserved jurisdiction over all other pending issues. As corrected, it also reserved jurisdiction "over any other adverse consequences of the early termination of marital status," and "over the issue of indemnification of health expenses beyond the eye and dental coverage . . . ." Subsequent proceedings were the appropriate forum in which to argue that Margaret's one-time right as a retiree to opt into the KPMG health plan was acquired during marriage and subject to valuation and division and that David needed a further order to protect him from the adverse consequences of early dissolution with respect to that option. (Compare In re Marriage of Ellis (2002) 101 Cal.App.4th 400, 408 [recognizing a general rule that retiree medical benefits are not divisible community property] and In re Marriage of Havins (1996) 43 Cal.App.4th 414, 423-424 [concluding that "right to continuation of subsidized health care coverage without evidence of good health is itself a property right that has some value, [but] the right is not subject to valuation and division at the time of dissolution when the employee or retiree continues to pay for the health insurance with his [or her] separate funds"] with In re Marriage of Moore (2014) 226 Cal.App.4th 92, 98-99 [benefits of medical trust established by employer "to pay retirees a monthly benefit up to a certain maximum for covered medical expenses and health insurance premiums" were "property rights because they represent[ed] a form of deferred compensation for services rendered"] and In re Marriage of Brown (1976) 15 Cal.3d 838, 845 [a spouse's contractual right to benefits earned as an employee during marriage is a chose in action, a form of property].) The status-only judgment did not decide whether the right to opt into the KPMG retiree health plan was a community property right or asset.
Moreover, any claim that David needed an interim indemnification condition as to the KPMG health plan option to protect his interests until there was a judgment on the reserved issues was rendered moot by the entry and filing of such judgment. A claim becomes moot when there is no longer any effective relief that the appellate court can provide. (See Consol. etc. Corp. v. United A. etc. Workers (1946) 27 Cal.2d 859, 863; Eye Dog Foundation v. State Board of Guide Dogs for Blind (1967) 67 Cal.2d 536, 541.) F. Termination of Marital Status Nunc Pro Tunc
The status-only judgment of dissolution was "entered nunc pro tunc" as of December 31, 2014. David complains that the early entry of judgment cost him "thousands of dollars in additional taxes due to the change in filing status to single." He asserts that "[a]ll the conditions necessary to enter judgment were not in place at the first hearing on December 9, 2014" and that the trial court lacked authority to enter a nunc pro tunc judgment. Margaret argues that David forfeited his arguments by his silence on the issue in the face of the court's remarks on December 9, 2014.
A specific statute governs nunc pro tunc judgments in dissolution proceedings. Section 2346, subdivision (a), states in pertinent part: "If the court determines that a judgment of dissolution of the marriage should be granted, but by mistake, negligence, or inadvertence, the judgment has not been signed, filed, and entered, the court may cause the judgment to be signed, dated, filed, and entered in the proceeding as of the date when the judgment could have been signed, dated, filed, and entered originally, if it appears to the satisfaction of the court that no appeal is to be taken in the proceeding or motion made for a new trial, to annul or set aside the judgment, or for relief under Chapter 8 (commencing with Section 469) of Title 6 of Part 2 of the Code of Civil Procedure." (Italics added.) The section empowers the trial court to act on its own motion. (§ 2346, subd. (b).) Subdivision (d) of that section limits the power of the court to enter a nunc pro tunc judgment, stating in part: "The court shall not cause a judgment to be entered nunc pro tunc as provided in this section as of a date before trial in the matter, before the date of an uncontested judgment hearing in the matter, or before the date of submission to the court of an application for judgment on affidavit pursuant to Section 2336."
Citing In re Marriage of Padgett (2009) 172 Cal.App.4th 830, David argues that a nunc pro tunc order can be used only to correct clerical error. Padgett involved a judgment of dissolution reserving jurisdiction over the pension plan of the former husband, who remarried, continued working, and then died before retiring and receiving any benefits from the plan. (Id. at p. 837.) The appellate court recognized that "[t]here are limits on a court's power to enter orders nunc pro tunc. [Citation.]" (Id. at p. 851.) The court stated that "the most that can be said with respect to the provision of the DRO reserving jurisdiction over the plan participant's pension is that the parties likely did not agree to disposition of pension assets and the court intended to address the issue at a later day." (Id. at p. 852.) The court indicated that nunc pro tunc orders are ordinarily used to correct clerical error by placing on the record what a court actually decided. (Ibid.) The appellate court concluded that, under the circumstances, the trial court had no authority after the death of the former husband to enter a QDRO nunc pro tunc. (Id. at p. 856.)
In this case, a contested hearing on bifurcation and trial on dissolution of the status of the marriage was not completed until February 3, 2015. Under the express terms of section 2346, the trial court had no authority to enter a status-only judgment nunc pro tunc as of December 31, 2014. Any failure to sign, file, or enter the status-only judgment on December 31, 2014 was not due to mistake, negligence, or inadvertence. (See § 2346, subd. (a).) The matter was contested, and it was not fully adjudicated until February 3, 2015. (See § 2346, subd. (d).) The court's authority to enter a judgment nunc pro tunc did not encompass backdating a judgment to a date before the contested hearing and trial was complete so that Margaret could file her tax return for 2014 as a single, unmarried person.
Further, the trial court's remark on December 9, 2014 that it was "reserving the right to go back and have the marriage end this year" was not a formal tentative ruling that invited objection. At that point, there was no opportunity or reason to object because the court immediately continued the hearing to February 3, 2015. In February 2015, the matter came before a different judge, who did not revisit the issue. We reject the forfeiture argument.
DISPOSITION
The status-only judgment of dissolution is modified to reflect entry of the judgment on February 3, 2015 and, as modified, is affirmed. The parties shall bear their own costs on appeal.
/s/_________
ELIA, ACTING P. J. WE CONCUR: /s/_________
BAMATTRE-MANOUKIAN, J. /s/_________
MIHARA, J.