Opinion
F086537
11-18-2024
In re the Marriage of ALFONSO and JULIA BERUMEN. v. JULIA BERUMEN, Appellant; ALFONSO BERUMEN, Respondent, ALFONSO BERUMEN JIMENEZ et al., Respondents.
John S. Dulcich for Appellant. Law Offices of Ira L. Stoker and Ira L. Stoker for Respondent Alfonso Berumen. Law Offices of Paige Etcheverry Barnes and Paige Etcheverry Barnes for Respondents Alfonso Berumen Jimenez, Socorro Berumen and Evelyn Berumen.
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Kern County, No. S-1501-FL-610371 Stephen D. Schuett, Judge.
John S. Dulcich for Appellant.
Law Offices of Ira L. Stoker and Ira L. Stoker for Respondent Alfonso Berumen.
Law Offices of Paige Etcheverry Barnes and Paige Etcheverry Barnes for Respondents Alfonso Berumen Jimenez, Socorro Berumen and Evelyn Berumen.
OPINION
FRANSON, Acting P. J.
In this marriage dissolution proceeding, Julia Berumen (Wife) challenges the trial court's determination of the community's interest in three rental properties acquired by Alfonso Berumen, Jr. (Husband) during the marriage. The court found Husband's father provided most of the funds to purchase the properties, Husband acquired a separate property interest in two properties as a gift from his father, and Husband's sister acquired the third property as a gift from their father. The court also found community funds- loan proceeds of $100,000-contributed to the purchase of one property and community funds paid for repairs and construction on another property. As a result, the court found a partial community property interest in those properties.
Wife contends the properties should have been characterized as entirely community property because the presumption that assets acquired during a marriage are community property was not rebutted. (See Fam. Code, § 760.) She argues Husband and his family had the burden of proof and applicable law required them to introduce specific documentary evidence tracing the source of the funds used to purchase the rental properties. Based on the specific-record requirement for tracing recognized in case law, Wife argues the oral testimony of Husband's father was insufficient as a matter of law to establish the source of the money used for the purchases. We reject Wife's view of the law. The specific-record requirement applies to tracing separate property commingled with community property and does not extend to gifts of real estate from a third party. (See In re Marriage of Ficke (2013) 217 Cal.App.4th 10, 27 [the recordkeeping requirement for tracing did not apply because "there was no commingling or payments from a community account"].) Thus, the sufficiency of the evidence for the trial court's finding that the properties were acquired by gift from the father is reviewed under the deferential substantial evidence standard. Despite the contradictions in the evidence presented by Husband and his family, we conclude substantial evidence supports (1) the trial court's resolution of those contradictions; (2) the finding Husband's father was the source of most of the purchase money; and (3) the resulting characterization of the three rental properties.
Undesignated statutory references are to the Family Code.
Another issue raised by Wife is whether she is entitled to an accounting of the income and expenses of the rental properties in which the community holds an interest. Based on the "fiduciary obligations of disclosure and accounting [that] bind spouses after separation until final distribution of assets" (In re Marriage of Prentis-Margulis &Margulis (2011) 198 Cal.App.4th 1252, 1270 (Margulis)), we conclude Wife has a right to an accounting of the income and expenses attributable to the community property interest in two of the rental properties from the date of separation until final distribution. On remand, the trial court shall order such an accounting.
In addition, Wife contends the trial court erred in setting permanent spousal support at zero and reserving jurisdiction over the issue of support. We reject this contention because Wife has not demonstrated she complied with the statutory requirement for the exchange of final disclosure declarations. (§ 2105, subd. (a).) This failure to comply with the mandatory disclosure requirement adequately supports the court's determination that it lacked sufficient information to award spousal support.
Wife also challenges the denial of her request for attorney fees under sections 2030 and 2032. The trial court determined she failed to present adequate information about her income and expenses, which prevented the court from determining whether there was a sufficient disparity in income to award attorney fees. As explained below, we will vacate the denial of attorney fees and allow the issue of attorney fees to be addressed after the accounting is completed.
We therefore affirm the judgment in part and reverse it in part.
FACTS
Husband is the son of Alfonso Berumen Jimenez (Senior) and Socorro Berumen. Husband's siblings include Evelyn Berumen, Yolanda Ochoa, and Alejandro Berumen. Senior, Socorro, and Evelyn are claimants in the marital property dispute and have appeared as respondents in this court. Yolanda and Alejandro are not parties to this litigation, but Husband and claimants presented evidence that Senior placed them on the title of other rental properties located in Delano.
Husband and Wife were married in February 1995 when she was 18 years old and he was about 20 or 21 years old. They had two children who are now adults. Husband's petition for dissolution asserts the parties separated in June 2009 after 14 years and four months of marriage.
The dispute over the division of marital property involves three multi-unit residential rental properties located in Delano. Recorded grant deeds show the properties were acquired from third parties after Husband and Wife were married and title was placed in Husband's name.
A seven-unit rental property located at 1006 Jefferson Street (1006 Jefferson) was acquired in 1999. The recorded deed stated a third party granted the property to Senior, a married man, and Husband, a married man as his sole and separate property, as joint tenants. Senior testified at trial that the funds used to purchase 1006 Jefferson and the two other disputed properties came from the sale of property he owned in Mexico. At the time of purchase, Senior was approximately 53 years old, Husband and Wife had been married for less than five years and had two children, and Husband worked in a market setting up displays. The trial court's decision stated there was no evidence that Husband and Wife had a source of income that would have allowed them to participate financially in the 1999 purchase of 1006 Jefferson. Further details about 1006 Jefferson and its acquisition are set forth in part I.C. of this opinion.
In May 2000, Husband began working for KVS Transportation, Inc. Husband's declarations list his occupation as a vacuum truck driver.
In 2001, a rental property located at 1016 7th Avenue (1016 7th Avenue) was acquired. It currently has six units. In 2006, a six-unit rental property located at 1307 Glenwood Street (1307 Glenwood) was acquired. Further details about 1016 7th Avenue and 1307 Glenwood are provided in parts I.D. and I.E. of this opinion.
The trial court's decision stated it received divergent testimony from the parties and witnesses concerning the collection and use of rent from the three properties and other rental properties owned by the parties in Delano. The legal issues presented in this appeal do not require a detailed description of Husband's involvement in the collection of rent or the amount of time he devoted during the marriage to maintaining the properties. Of relevance to Wife's claim for an accounting is the fact that none of Husband's income and expense declarations (form FL-150) reported any rental property income.
In contrast, the joint tax returns of Husband and Wife for 2005 through 2008 reported income and expenses from the properties. Schedule E for the 2005 and 2006 returns listed 1006 Jefferson and 1016 7th Avenue as rental real estate and claimed a loss in each year. The 2007 and 2008 returns listed all three properties and claimed a loss in each year. For example, the 2007 return reported the three properties generated $32,400 in rent and $48,810 in expenses, resulting in a loss of $16,410 for the year.
Husband's separate tax returns for 2009 and 2010 also were admitted into evidence. The returns reported income and expenses for 1006 Jefferson and 1307 Glenwood and did not list 1016 7th Avenue. The 2010 return claimed a rental real estate loss of $3,666 based on $28,000 in rent received and total expenses of $31,666. Husband's 2009 return reported a rental real estate loss of $3,642, based on $23,920 in rent received and total expenses of $27,562.
In 2012, Husband answered interrogatories about the monthly payments from the rental units on the properties. Based on Husband's answers, if 1006 Jefferson's seven units were fully occupied for a year, the rental payments for a year would total $30,300. If 1307 Glenwood's six units were fully occupied, the rental payments for a year would total $29,640. Husband's interrogatory answers also state he did not have documentation for 1016 7th Avenue because that property was under the control and management of Senior.
PROCEEDINGS
In October 2008, Husband filed a petition for dissolution of marriage, asserting a date of separation in September 2008. The petition was dismissed. On July 15, 2009, Husband filed a second petition for dissolution of marriage, asserting separation occurred on June 22, 2009.
In April 2013, as a result of Wife's assertion of a community property interest in the three rental properties, Senior and Socorro filed a motion for joinder as claimants using form FL-371. Their declaration for joinder stated under penalty of perjury that the three "properties are actually our properties/assets." In June 2016, Wife filed a pleading on joinder for interpleader seeking to add Evelyn to the proceedings, because Husband had transferred title of 1016 7th Avenue to Evelyn. In November 2016, Evelyn filed an answer alleging all three properties were the assets of her parents.
In November 2018, the first trial on the marital property dispute ended with a mistrial. In March 2020, Wife filed a petition to establish spousal claim to community estate, obtain accounting of community property, and recover damages for breach of fiduciary duty. The petition asserted the three rental properties were presumed to be community property and requested an accounting of all rental income generated by the properties from the September 2008 to the present.
The trial was held over five days in April 2022. In July 2022, the trial court filed a judgment of dissolution, status only, stating the marital status of the parties terminated on July 6, 2022. In January 2023, after posttrial written argument and supplemental briefing, the trial court issued an 11-page proposed statement of decision and tentative ruling, which did not address Wife's requests for an accounting, spousal support, or attorney fees.
In February 2023, claimants filed a request for order clarifying the tentative ruling's statement about the "parties informal family investment scheme." Wife filed a response stating she did not agree with the clarification requested by claimants, proposing her own clarifications, and asking for rulings on her requests for spousal support and attorney fees. In March 2023, Husband filed a request for order clarifying the court's intentions regarding spousal support.
The trial court heard arguments on the requests for order on March 27, 2023, and April 24, 2023. On April 26, 2023, the court issued a 12-page final statement of decision under Family Code section 3022.3 and Code of Civil Procedure section 632. The decision characterized (1) 1006 Jefferson as the separate property of Husband, having been acquired by gift from Senior; (2) 1016 7th Avenue as the separate property of Evelyn, subject to the reimbursement to the community of $136,000 contributed by the community for repairs and construction of new rental units; and (3) 1307 Glenwood as a mixed asset consisting of both Husband's separate property interest and a 29.9 percent community property interest based on the community's contribution of $100,000 to the purchase price.
The statement of decision also set permanent spousal support at zero, reserved jurisdiction over the issue of spousal support, denied Wife's request for attorney fees, and did not rule on her request for an accounting. The denial of spousal support and attorney fees was based on the lack of information about relevant factors, which the court attributed to Wife's failure to file the required declarations. The statement of decision directed Wife's counsel to prepare a judgment on reserved property issues for the court's signature.
On July 11, 2023, the trial court signed and filed the judgement on reserved issues. The next day, a deputy clerk filed a notice of entry of judgment and Wife filed her notice of appeal.
Husband and the claimants did not file a cross-appeal challenging the trial court's determinations that the community had a $136,000 interest in 1106 7th Avenue and a 29.9 percent ownership interest in 1307 Glenwood.
DISCUSSION
I. CHARACTERIZATION OF THE RENTAL PROPERTIES
Wife contends the trial court committed legal error about the type of evidence needed to overcome the presumption that an asset acquired during a marriage is community property and this error caused the court to mischaracterize the three rental properties. Our analysis of these contentions begins with an overview of the principles for characterizing marital property established by the California Constitution, statutes, and case law.
A. Basic Principles for Characterizing Property
Characterization of property for purposes of California's community property law refers to the process of classifying property as separate, community or quasi-community. (In re Marriage of Haines (1995) 33 Cal.App.4th 277, 291 (Haines).) This process determines the rights of each spouse and is an integral part of the division of property on marital dissolution. (Ibid.; see § 1101, subd. (a) [court authorized to determine "the classification of all property of the parties to a marriage"].)
1. Constitutional and Statutory Provisions
The California Constitution sits atop of the hierarchy of state laws governing the characterization process. Its Declaration of Rights states: "Property owned before marriage or acquired during marriage by gift, will or inheritance is separate property." (Cal. Const., art. I, § 21, italics added.)
In accordance with this constitutional provision, section 770, subdivision (a) provides: "Separate property of a married person includes all of the following: [¶] (1) All property owned by the person before marriage. [¶] (2) All property acquired by the person after marriage by gift, bequest, devise, or descent. [¶] (3) The rents, issues, and profits of the property described in this section." (Italics added.) Neither spouse has any interest in the separate property of the other, except as otherwise provided by statute. (§ 752.)
In comparison, the spousal interests in community property are "present, existing, and equal." (§ 751.) Section 760 defines community property by stating: "Except as otherwise provided by statute, all property, real or personal, wherever situated, acquired by a married person during the marriage while domiciled in this state is community property." (Italics added.) Here, it is undisputed that whatever interest Husband and Wife had in the three rental properties was acquired during the marriage.
2. Presumption for Property Acquired During the Marriage
Under section 760," 'there 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. [Citation.] This is a rebuttable presumption affecting the burden of proof; hence it can be overcome by the party contesting community property status. [Citation.] Since this general community property presumption is not a title presumption, virtually any credible evidence may be used to overcome it, including tracing the asset to a separate property source, showing an agreement or clear understanding between the parties regarding ownership status and presenting evidence the item was acquired as a gift.'" (In re Marriage of Ciprari (2019) 32 Cal.App.5th 83, 91, quoting Haines, supra, 33 Cal.App.4th at pp. 289-290.)
"A spouse's claim that property acquired during a marriage is separate property must be proven by a preponderance of the evidence." (In re Marriage of Valli (2014) 58 Cal.4th 1396, 1400; see Evid. Code, §§ 115 [burden of proof], 601 [classification of presumptions], 605 [presumption affecting the burden of proof defined], 606 [effect of presumption affecting the burden of proof].)
3. Standard of Review
Generally, the trial court's findings of fact underlying whether a particular item is separate or community property is reviewed on appeal under the substantial evidence standard. (In re Marriage of Dekker (1993) 17 Cal.App.4th 842, 849.) To the extent the determination is based on the selection of a legal rule, that selection entails the resolution of a pure question of law and is subject to de novo review. (In re Marriage of Ruiz (2011) 194 Cal.App.4th 348, 353.) To the extent the determination of the character of an asset amounts to the resolution of a mixed question of law and fact that is predominantly one of law, it is subject to de novo review. (Id. at p. 354; accord, In re Marriage of Rossin (2009) 172 Cal.App.4th 725, 734.)
B. Wife's Claim of Trial Court Error
Wife contends the trial court's characterization of the rental properties was "erroneous as a matter of law because mere oral testimony is insufficient evidence in a disputed case." Wife argues Husband had the burden of proof and that burden required him to provide documentary evidence tracing the funds used to purchase the properties to their source. Wife relies on the analysis used in In re Marriage of McLain (2017) 7 Cal.App.5th 262 and See v. See (1966) 64 Cal.2d 778 for tracing separate property when there is a commingling of community and separate assets and income.
Wife's contention that documentary evidence was necessary and, thus, Senior's oral testimony was insufficient as a matter of law presents a question of law subject to our independent review. (See In re Marriage of Ettefagh (2007) 150 Cal.App.4th 1578, 1584 [trial court's selection of what legal principles to apply is subject to de novo review] (Ettefagh).) As explained below, we conclude the specific-records requirements applied to separate property funds commingled with community property do not apply to real property a spouse acquires during the marriage as a gift from a third party, such as a family member. Thus, we reject Wife's claim the trial court selected and applied an incorrect legal standard in determining whether the presumption had been rebutted.
The first step in our analysis of this legal issue reviews the constitutional and statutory text to determine if that text requires the evidence proving a parcel was acquired by gift to include documents establishing the source of money used to purchase the parcel. The constitutional provision stating property "acquired during marriage by gift .. is separate property" does not describe how one proves the property was a gift and makes no reference to tracing or documentary proof. (Cal. Const., art. I, § 21.) The same is true of the statutes defining community property and providing that "property acquired by the person after marriage by gift" is separate property. (§§ 770, subd. (a)(2), 760.)
Our second step considers how decisional law describes the general community property presumption created by section 760. In Haines, the court identified "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." (Haines, supra, 33 Cal.App.4th at pp. 289-290, italics added.) This wording specifies two ways to avoid the community property presumption-namely, (1) prove the property was acquired by gift or inheritance or (2) trace the property to a separate property source. The wording does not require documentary evidence establishing the source of funds used by a third-party donor to pay for a gift.
Decisional law also provides that "virtually any credible evidence may be used to overcome [the presumption], including [1] tracing the asset to a separate property source, [2] showing an agreement or clear understanding between the parties regarding ownership status, and [3] presenting evidence the item was acquired as a gift." (Haines, supra, 33 Cal.App.4th at p. 290.) Like the wording of the presumption itself, this principle implies that acquisition by gift and tracing to a separate property source are distinct ways of establishing the presumption does not apply. Further, the phrase "virtually any credible evidence" does not support Wife's contention that documentary evidence is needed to establish that no community property funds were used by a third-party donor to pay for a property transferred to a spouse as a gift.
Our third step examines a case that resolved the standard of proof applicable to a spouse's claim that an asset was acquired by gift. In Ettefagh, supra, 150 Cal.App.4th 1578, the wife alleged four California parcels acquired by the husband during the marriage were community property. (Id. at p. 1581.) After a trial, the court determined the parcels were the husband's separate property based on its finding that he acquired his interests in the parcels as gifts from his father. (Id. at p. 1583.) The wife appealed, contending the trial court erred by (1) applying the preponderance of the evidence standard of proof and (2) accepting" 'any credible evidence'" to overcome the community property presumption. (Id. at p. 1584.) The appellate court affirmed, concluding in the published part of its opinion that the correct standard of proof was the preponderance of the evidence. (Ibid.)
In Ettefagh, as in the present case, the husband's father testified he provided the funds to purchase the parcels and his son did not contribute to the purchases. (Ettefagh, supra, 150 Cal.App.4th at pp. 1581-1582.) The father's reason for placing title in his son's name was to assist the son in obtaining entry into the United States and a green card. (Id. at p. 1583.) The parties agreed the parcels were acquired during their marriage and were presumed to be community assets. (Ibid.) The trial court credited the father's testimony that he purchased the parcels with his own funds and placed title in his son's name, noting there was no documentary evidence supporting the wife's claim her husband supplied the funds for the purchases. (Ibid.) The appellate court determined the husband and his father had presented sufficient evidence to overcome the community property presumption, but did not publish that part of the opinion. (Id. at p. 1591.) Consequently, Ettefagh only establishes the proper standard of proof and provides some context for the documentary tracing issue raised in this appeal. Despite the factual similarities to the present appeal, Ettefagh is precedent resolving the legal question presented here-namely, whether specific documentary evidence is essential to prove the funds used by a third-party donor to buy a gift come from a noncommunity property source.
The foregoing three steps establish the context for our examination of some cases applying the principle that documentary evidence, not oral testimony, tracing funds to a separate property source is required to overcome the presumption that an asset acquired during a marriage is community property. The cases recognize two tracing methods for determining the character of disputed property interests-direct tracing and family living expense tracing. (In re Marriage of Braud (1996) 45 Cal.App.4th 797, 823.) In Braud, the disputed asset was improvements to the community property home paid for with funds from a commingled account. In that situation, the direct tracing "method requires specific records reconstructing each separate and community property deposit, and each separate and community property payment as it occurs. Separate property status cannot be established by mere oral testimony of intent or by records that simply total up all separate property funds available during the relevant period and all the separate expenditures during that period; such records do not adequately trace to the source of the purchase at the time it was made." (Ibid.) The court referred to the specific-record requirement as "the exacting standards of proof required for tracing funds in a commingled account." (Id. at p. 824, italics added.)
Similarly, in In re Marriage of Stoll (1998) 63 Cal.App.4th 837, the court observed that "[d]irect tracing to a separate source ... has traditionally been subject to a requirement that it be done by specific records. Mere oral testimony of intent has been held to be inadequate to do the job in light of the general presumption that property acquired during a marriage is community." (Id. at p. 841.) The court addressed the circumstances in which the requirement applies by stating: "The granddaddy of the specific-record requirement was our Supreme Court's decision in See v. See (1966) 64 Cal.2d 778.... The context of the discussion is the commingling of funds in a bank account and a rich husband's attempt to trace his separate property in that account. [Citation.] The court explained, in light of the general community property presumption, that a spouse cannot 'invoke the burden of record keeping as a justification for a recapitulation of income and expenses at the termination of the marriage that disregards any acquisitions that may have been made during the marriage with community funds.' [Citation.] Hence the court concluded that, once the husband 'commingles, he assumes the burden of keeping records adequate to establish the balance of community income and expenditures at the time an asset is acquired with commingled property.'" (In re Marriage of Stoll, supra, at p. 841, italics added.)
More recently, an appellate court concluded the recordkeeping requirements did not apply in the case before it because the trial court impliedly found "there was no commingling or payments from a community account." (In re Marriage of Ficke, supra, 217 Cal.App.4th at p. 27.)
Based on the foregoing cases, we conclude the specific-record requirement for tracing does not apply to a spouse's acquisition of real property by gift from a third party, such as a family member. Consequently, we conclude the trial court did not commit legal error by failing to apply the specific-record requirement to the three rental properties that Husband and Evelyn acquired as gifts from Senior. Having rejected the specific legal theory underlying Wife's claim of error for each of the three properties, we next consider whether the trial court's characterization of each property is supported by sufficient evidence.
C. 1006 Jefferson
1. Chain of Title
On July 30, 1999, a grant deed dated June 23, 1999, and two interspousal transfer deeds dated July 7, 1999 were recorded for 1006 Jefferson. The grant deed stated Kurt D. Kruger, an unmarried man, granted the property to Senior, a married man, and Husband, a married man as his sole and separate property, as joint tenants. The interspousal transfer deed signed by Wife stated she granted 1006 Jefferson to Husband, a married man as his sole and separate property. Soccorro signed a similar deed for Senior.
Also recorded on July 30, 1999, was a short form deed of trust and assignment of rents dated June 23, 1999. It was signed by Senior and Husband for the benefit of Kruger, the seller, to secure a debt of $35,000.
On May 25, 2004, Senior and Husband signed a grant deed transferring 1006 Jefferson to Husband, "a married man as his sole and separate property." The deed was recorded the next day.
In May 2008, Husband signed and recorded a deed to revocable trust stating he granted 1006 Jefferson to himself, as trustee of the Alfonso Berumen Jr. Living Trust, U/A dated May 2, 2008.
2. Testimony
Husband testified he had no ownership interest in the three properties and merely held title for the convenience of this father. He also testified he asked Wife to sign the interspousal transfer deed because he knew he had no interest in 1006 Jefferson and he knew the property did not belong to them. Wife testified Husband told her to sign the interspousal transfer deed to give him permission to buy the property, she did not know she was signing away rights, and she did not read or understand the document.
Senior testified at trial that he purchased 1006 Jefferson and the other two disputed properties with funds acquired from the sale of other property in Mexico and Husband and Wife did not contribute to the purchase of the properties. When 1006 Jefferson was purchased, Senior placed it in Husband's name with the intention that it would be his son's inheritance. He also testified the 2004 transfer of his interest in 1006 Jefferson to Husband was intended to be a gift to his son. Senior testified it was his idea to have Wife sign the interspousal transfer deed, he told Husband that Wife did not have any rights to the property, and he never spoke with Wife about the deed.
3. Trial Court s Findings
The trial court's final statement of decision summarized the evidence presented by stating (1) the only evidence about the funds used to purchase 1006 Jefferson was Senior's testimony that he used funds from the sale of property in Mexico; (2) neither Husband or Wife testified they contributed to the purchase price; and (3) there was no evidence they had a source of income at that time that would have allowed them to participate in the purchase.
The court's decision also stated, "it did not find the testimony of Senior, [Husband,] or [Wife] to be credible in many respects" and gave examples of contradictions and evasions. Resolving the various conflicts and contradictions, the court found Husband had an ownership interest in the three disputed properties but concluded that fact alone did not resolve whether the community had an interest in the properties.
The court then addressed the community's interest in 1006 Jefferson and concluded the starting point of the analysis was the rebuttable presumption that property acquired during marriage. The court stated it was "clear the property was acquired with Senior's funds and was later transferred to [Husband] alone as a gift from Senior" without any contribution from the community to the purchase of the property.
The court determined there was no unfair advantage accruing to Husband from having Wife sign the interspousal transfer deed because (1) the property was a gift to Husband and, thus, was not presumed to be community property and (2) no community funds were used to purchase the property. (See § 721 [fiduciary duty between spouses].) Based on the foregoing determinations, the court characterized 1006 Jefferson as the separate property of Husband.
4. Sufficiency of the Evidence
The sufficiency of the evidence to support the trial court's finding Husband acquired the property by gift is subject to review under the substantial evidence standard. (See In re Marriage of Dekker, supra, 17 Cal.App.4th at p. 849.) We conclude the finding is supported by substantial evidence, including the uncontradicted oral testimony of Senior about the source of funds used to purchase 1006 Jefferson, the evidence that in 1999 Wife and Husband lacked the financial wherewithal to contribute to the purchase, Senior's testimony that his 2004 transfer of title to Husband was intended as a gift, and the recorded deeds, which are not conclusive but corroborate Senior's testimony about his intent to have 1006 Jefferson be his son's separate property. (See generally, In re Marriage of Mix (1975) 14 Cal.3d 604, 614 [testimony of a single witness, even a party in a divorce case, may constitute substantial evidence].)
D. 1016 7 th Avenue
A grant deed dated August 2, 2001, and recorded September 10, 2001, stated three married couples granted their interests in 1016 7th Avenue to Husband, a single man. The reference to Husband as a single man was wrong.
A short form deed of trust dated July 15, 2006, and stating it was made by Husband and Wife, "who acquired title as Alfonso Berumen, Jr., a single man," was signed by them to secure a $100,000 loan from Bank of America. The deed of trust was recorded on August 9, 2006. Senior testified the loan proceeds went towards the purchase of 1307 Glenwood and he made the payments on the loan from Bank of America in cash.
In April 2009, Husband signed and recorded a grant deed stating he granted 1016 7th Avenue to Evelyn, a married woman, as her sole and separate property. Wife did not sign any interspousal transfer deeds for 1016 7th Avenue, either when it was acquired in 2001 or when it was transferred in 2009. Wife notes this transfer occurred after Husband dismissed his first dissolution petition and before he filed his second petition when he was not subject to the automatic temporary restraining orders set forth in the summons for marriage dissolution proceedings. (See § 2040; Cal. Rules of Court, rule 5.50(b).)
Subsequent references to a numbered "Rule" are to the California Rules of Court.
The trial court addressed the acquisition of 1016 7th Avenue by recounting the testimony of John Lara, a realtor involved in the 2001 purchase. Lara testified (1) the property was sold to Senior for $90,000 cash; (2) Senior paid the deposit; (3) title was placed in Husband's name at Senior's request; and (4) at the time, Lara did not know Husband was married. The trial court stated the evidence clearly established the purchase price for 1016 7th Avenue was paid by Senior and neither Husband nor Wife contributed any funds to its purchase. The court also stated Senior testified (1) he did not give the property to Husband; (2) in 2009 he ordered Husband to transfer title to Evelyn; and (3) he considered this transfer to represent Evelyn's inheritance. The court also stated Husband testified he and Wife never discussed the purchase of the property or its transfer to Evelyn.
The respondents' briefs assert Evelyn was underage and, thus, imply this is the reason title initially was placed in her brother's name and subsequently transferred to her. Their assertion about her age is not supported by a citation to the record and, therefore, we do not consider it in our analysis of the sufficiency of the evidence. (See Citizens Opposing a Dangerous Environment v. County of Kern (2014) 228 Cal.App.4th 360, 366, fn. 8 [" 'Factual matters that are not part of the appellate record will not be considered on appeal and such matters should not be referred to in the briefs.' "].)
Because the source of funds to acquire 1016 7th Avenue was not community property, the court found the presumption that it was community property had been overcome. The court determined 1016 7th Avenue was "the separate property of Evelyn, subject to the reimbursement to the community of $136,000 contributed by the community for the repairs and construction of new rental units." The court gave Evelyn 90 days from entry of the judgment on reserved issues to satisfy the $136,000 claim and stated the money was to be divided equally between Husband and Wife. Husband and claimant did not file a cross-appeal challenging the finding of a $136,000 community property interest in 1016 7th Avenue. Therefore, a description of the evidence supporting the finding is not essential to explaining our resolution of the issues raised by Wife's appeal.
We conclude the testimony of Senior constitutes substantial evidence that he did not give 1016 7th Avenue to Husband and ownership was transferred to Evelyn as a gift intended to be an early inheritance. Thus, we uphold the trial court's finding that Evelyn owned the property and the community property presumption had been overcome, except for the $136,000 used for construction and repairs.
E. 1307 Glenwood
On July 28, 2006, a grant deed dated July 6, 2006, and an interspousal transfer deed dated July 14, 2006 were recorded for 1307 Glenwood. The grant deed stated Jose and Guadalupe Fernandez granted the property to Husband, a married man as his sole and separate property. The interspousal transfer deed signed by Wife stated she granted 1307 Glenwood to Husband, a married man as his sole and separate property. The timing of the acquisition of 1307 Glenwood is consistent with the recording of the short form deed of trust dated July 15, 2006, against 1016 7th Avenue to secure a loan of $100,000.
In May 2008, Husband signed and recorded a deed to revocable trust stating he granted 1307 Glenwood to himself, as trustee of the Alfonso Berumen Jr. Living Trust, U/A dated May 2, 2008.
The trial court found 1307 Glenwood was purchased for $340,000 plus escrow expenses. It also found the escrow records showed Husband deposited a series of cashier's checks from Bank of America, Wells Fargo, and SafeOne Credit Union. Acknowledging the lack of clarity about the underlying source of the funds of the various cashier's checks, the court stated Senior testified (1) the down payment for 1307 Glenwood came from his funds and a loan taken out by Husband and (2) all payments on the loan were made by Senior using rental receipts deposited in Bank of America or in cash.
The trial court found "there is both a separate and community interest based on the source of funds for the purchase price. [1307 Glenwood] was acquired by a cash payment from Senior of $234,941 and a loan of $100,000 from Bank of America" The court determined the loan proceeds were community property because the loan was made to Husband and Wife and no evidence was presented showing Bank of America intended to rely on Husband's separate property for repayment. Thus, the court concluded 1307 Glenwood was "a mixed asset consisting of both [Husband's] separate property interest and a community property interest." The court then addressed transmutation and concluded Wife had not transmuted her community property interest in 1307 Glenwood.
Accordingly, the trial court found 1307 Glenwood was both community and separate property and, based on the respective contributions, determined Husband had a 71.1 percent interest ($234,941 divided by $334,941) and the community had a 29.9 percent interest based on its contribution of the remaining $100,000. The court stated it had not been provided with evidence of the property's current market value, gave the parties 90 days from the entry of the judgment on reserved issues to agree on an amount to reimburse the community for its interest, and stated any party could seek a court order for the sale of the property if an agreement was not reached.
The two percentages add up to 101. The community's interest of 29.9 percent was calculated accurately. However, the calculation of Husband's separate property percentage contains a typographical or mathematical error because $234,941 divided by $334,941 is approximately 70.1439 percent, which rounds down to 70.1 percent (not 71.1). Consequently, we will modify the judgment to state the correct percentage.
As with the other properties, we conclude the testimony of Senior and the recorded documents constitutes substantial evidence that 1307 Glenwood was a gift to Husband as his separate property, except for the 29.9 percent community property interest.
II. ACCOUNTING FOR RENTAL INCOME AFTER SEPARATION
A. Background
Section 721, subdivision (b) provides that "spouses are subject to the general rules governing fiduciary relationships that control the actions of persons occupying confidential relations with each other." The rights and obligations arising from this relationship include "[r]endering upon request, true and full information of all things affecting any transaction that concerns the community property." (§ 721, subd. (b)(2); see Hogoboom &King, Cal. Practice Guide: Family Law (The Rutter Group 2024) ¶¶ 8:603, 8:614 [accounting and incidental relief], pp. 8-229, 8-242.) They also include "[accounting to the spouse, and holding as trustee, any benefit or profit derived from any transaction by one spouse without the consent of the other spouse that concerns community property." (§ 721, subd. (b)(3).) When the fiduciary duty has been breached, one of the statutory remedies available to the aggrieved spouse is an accounting. (See Hogoboom &King, Cal. Practice Guide: Family Law, supra, ¶¶ 8:613-8:614, p. 8-242.) Section 1101, subdivision (b) provides in part: "A court may order an accounting of the property and obligations of the parties to a marriage[.]" Other statutes relevant to the accounting issue are referred to in part II.C. of this opinion.
B. Contentions of the Parties
Wife contends the trial court erred in not ordering an accounting of the rental income generated by the community property after the separation. She requests this court remand the issue of postseparation rental income with instructions for the trial court to order Husband to account for the rental income as to all community property. Based on the characterization of the rental properties upheld in part I. of this opinion, that relevant rental proceeds would relate to the $136,000 community property interest in 1016 7th Avenue and the 29.9 percent community property interest in 1307 Glenwood.
Husband contends the trial court did not err by not ordering an accounting of rental income after the date of separation. First, he contends Wife is incorrect in asserting there is unequal access to the evidence of the rental income because before the separation she was aware of the rental proceeds from 1307 Glenwood as they both collected rents while Senior was in Mexico for two years following a heart attack. He also refers to all the rental receipts Wife introduced into evidence and to her testimony about paying property taxes for 1307 Glenwood and 1006 Jefferson with cash from rental proceeds. Based on this evidence, Husband argues Wife was clearly aware of the amounts of rental income derived from the properties and her current claim that she is ignorant of the rental income simply lacks coherence.
Second and alternatively, Husband asserts the trial court "did not order an accounting for rental income post separation, determining that [Husband] and [Wife] had 90 days to resolve this matter between themselves." Husband supports this interpretation of the trial court's order with the following block citation: "(4 CT 1190 - 5 CT 1210)."
C. Interpretation of the Judgment
Initially, we consider Husband's claim that the trial court gave the parties 90 days to resolve the issue of accounting for postseparation rental income attributable to the community property identified by the trial court.
First, his respondent's brief's block citation to 21 pages of the clerk's transcript does little to support his imaginative interpretation of the trial court's decision. Under Rule 8.204(a)(1)(C), appellate briefs must "[s]upport any reference to a matter in the record by a citation to the volume and page number of the record where the matter appears." Courts have interpreted this provision to mean each party must" 'support the arguments in its briefs by appropriate reference to the record, which includes providing exact page citations.'" (Nazari v. Ayrapetyan (2009) 171 Cal.App.4th 690, 694, fn. 1.) Thus, in Ruiz Nunez v. FCA U.S. LLC (2021) 61 Cal.App.5th 385, the court determined the defendant violated the rule by citing "to large swathes of the reporter's transcript rather than to specific pages." (Id. at p. 392.) Similarly, in Graham v. Bank of America, N.A. (2014) 226 Cal.App.4th 594, the court stated, "block citations do not comply with ... [R]ule 8.204(a)(1)(C) and frustrate the court's ability to evaluate the party's position." (Graham, supra, at p. 611; see Bernard v. Hartford Fire Ins. Co. (1991) 226 Cal.App.3d 1203, 1205 [interpreting a predecessor of Rule 8.204].)
Second, we have reviewed the judgment on reserved issues filed July 11, 2023, including the 18-page attachment, in an attempt to locate where-as represented by Husband-the trial court determined "that [he] and [Wife] had 90 days to resolve this matter between themselves." The attachment refers to Wife's "Petition to Establish Spousal Claim to Community Estate, Obtain Accounting of Community Property, and Recover Damages for Breach of Fiduciary Duty" and does not use the word "accounting" again. Thus, the judgment did not explicitly provide for an accounting or explicitly reserve the issue while directing the parties to meet and confer to resolve the issue of the postseparation income and expenses attributable to the community's interests in 1307 Glenwood and 1016 7th Avenue.
The judgment stated that, with respect to 1016 7th Avenue, "Evelyn shall have ninety (90) days from the entry of judgment on the reserved issues to satisfy this claim. The $136,000 is to be divided equally between [Husband] and [Wife]. If the parties have not reached a resolution on the payment of this reimbursement after ninety (90) days from entry of judgment, any party may return and seek an order of the Court for the sale of the property." This language places no obligation on Husband or Evelyn to work with Wife to determine the amount of postseparation rental income and expense attributable to the community's $136,000 interest, much less obligate anyone to pay Wife her share of the net rental income from the date of separation until final reimbursement of Wife's share of the $136,000 interest.
The judgment awarded a separate property interest of 70.1 percent to Husband and a 29.9 percent interest to the community in 1307 Glenwood. It addressed the reimbursement of that community property interest by stating: "The parties have ninety (90) days from entry of the judgment on reserved issues to determine the amount of the community's pro rata value in the Glenwood property and reach agreement on the reimbursement of the community. In the absence of an agreement, any party may return and seek an order of the Court for the sale of the Glenwood property." The directive to determine the value of the community's interest in 1307 Glenwood does not appear to reach the income generated by that interest and, therefore, does not obligate the parties to work together in an attempt to determine the amount of postseparation rental income and expense attributable to the community's 29.9 percent interest in 1307 Glenwood.
Based on the actual wording of the judgment, we reject Husband's argument that the trial court's order directed the parties to resolve the issue of the community's interest in postseparation rental income between themselves. Because a resolution of Wife's claim for an accounting was omitted from the statement of decision and subsequent judgment, we next consider the appropriate appellate relief for dealing with the omitted issue.
D. Remand for an Accounting
The fiduciary duties of disclosure and accounting imposed on spouses by the Family Code are described in Margulis, supra, 198 Cal.App.4th 1252. There, the Fourth District discussed sections 721, 1100, 1101, 2100, 2102, and 2107, along with provisions of the Corporations Code incorporated into Family Code section 721. (Margulis, supra, at pp. 1268-1274.) Section 2100 refers to the spouse's obligation to make a full and accurate disclosure of all assets and liabilities in which one or both of them have an interest and refers to the "continuing duty to immediately, fully, and accurately update and augment that disclosure to the extent there have been any material changes so that .. at the time of trial on these issues, each party will have a full and complete knowledge of the relevant underlying facts." (§ 2100, subd. (c), italics added.) In addition, section 2102, subdivision (a) addresses the duties in place after separation by stating:
"From the date of separation to the date of the distribution of the community or quasi-community asset or liability in question, each party is subject to the standards provided in Section 721, as to all activities that affect the assets and liabilities of the other party, including, but not limited to, ... [¶] ... [t]he accurate and complete disclosure of all assets and liabilities in which the party has or may have an interest or obligation and all current earnings, accumulations, and expenses, including an immediate, full, and accurate update or augmentation to the extent there have been any material changes."
In Margulis, the Fourth District concluded "these fiduciary obligations of disclosure and accounting continue to bind spouses after separation until final distribution of assets." (Margulis, supra, 198 Cal.App.4th at p. 1270.)
Based on the statutes and principles set forth in Margulis, we conclude Wife is entitled to an accounting of postseparation net income attributable to the community property interest in the properties. None of the income and expense declarations completed by Husband disclosed any rental income, much less an accurate and complete disclosure of the earnings, accumulations, and expenses associated with the community's interest in 1307 Glenwood and 1016 7th Avenue. Furthermore, Husband's contention that an accounting is not required because of Wife's equal access to information is wholly devoid of merit because it does not address her postseparation access to information and in no way justifies his failure to disclose his rental income. Therefore, on remand the trial court shall require Husband and the claimants to provide Wife with an accounting of the postseparation earnings, accumulations, and expenses attributable to the community's 29.9 percent interest in 1307 Glenwood and the community's $136,000 interest in 1016 7th Avenue. Further, when issues about the accuracy of the accounting are resolved, the court shall direct Husband and claimants to pay Wife her one-half interest of the community's net income from those properties.
III. SPOUSAL SUPPORT
A. Wife's Request and the Trial Court's Decision
Wife's March 2022 trial brief asserted she "should be awarded at least, $3,000 per month, spousal support." In a posttrial responsive declaration, Wife summarized her trial testimony about the statutory factors, stating (1) she was "currently suffering from depression, health and medical issues, including diabetes," (2) she was unemployed and needed continued spousal support, and (3) her request for $3,000 per month was based on the lifestyle established during the marriage. The declaration also asserted she devoted her time during the marriage to her duties as a wife and mother and she also devoted substantial time to the investment property venture Husband had with his father.
The trial court's statement of decision acknowledged her request for at least $3,000 per month in permanent spousal support. It then addressed applicable law by summarizing the factors contained in subdivisions (a) through (n) of section 4320 and quoting the principle that a court" 'has broad discretion in balancing the applicable statutory factors and determining the appropriate weight to accord to each, but it may not be arbitrary and must both recognize and apply each applicable factor.' (In re Marriage of Ackerman (2006) 146 Cal.App.4th 191, 207.)" Next, the decision stated:
"[Wife] bears the burden of establishing the necessary factors under section 4320 in order for the Court to determine whether any support is necessary and the amount of permanent support to award. Here, [Wife] testified that she is not currently employed but that she works seasonally. However, [Wife] did not provide, as required by California Rules of Court, Rule 5.260, a current Income and Expense Declaration. Given the complete lack of information concerning her income and expenses and the lack of evidence to support the section 4320 factors, the Court will set permanent support at zero, reserving jurisdiction over the issue of support given this is a long-term marriage."
The court also addressed Husband's request for an order determining Wife had stipulated to the termination of spousal support. The court stated there was nothing in the record to support Husband's allegation and denied the request.
On appeal, Wife asserts the trial court did not award spousal support because she did not submit an income and expense declaration. Wife argues the court's reliance on Rule 5.260(a) was improper because it governs the filing of an income and expense declaration in connection with a request for an order of temporary (i.e., interim or pendente lite) support and Rule 5.260(e) speaks to judgments for support. Wife contends Rule 5.260(e)(2)(B), which states "the parties may use Spousal or Partnership Support Declaration Attachment (form FL-157) to address the issue of spousal ... support under Family Code section 4320 when relevant," does not mandate use of the form declaration and, therefore, a trial court was required to analyze her trial testimony about the statutory factors.
B. Declaration Requirement
Our analysis of the legal principles governing the evidence needed to establish a claim for permanent spousal support begins at the top of the hierarchy of state laws. The California Constitution does not expressly address spousal support. However, it does contain a provision relevant to our interpretation of Rule 5.260. That provision empowers the Judicial Council to "adopt rules for court administration, practice and procedure[.]" (Cal. Const., art. VI, § 6, subd. (d).) The sentence most relevant to this appeal states: "The rules adopted shall not be inconsistent with statute." (Ibid.)
Consequently, we consider whether any statutes address the evidence required to prove a claim for spousal support because, as required by the constitution, Rule 5.260 must be interpreted to be consistent with any such statute. Our inquiry leads us to the chapter of the Family Code governing the disclosure of assets and liabilities in a dissolution proceeding. (See §§ 2100-2113.) The statutory provisions for disclosure, the use of declarations, and the underlying public policies have been discussed in the case law and secondary authorities. (E.g., Lappe v. Superior Court (2014) 232 Cal.App.4th 774, 780-782; In re Marriage of Evans (2014) 229 Cal.App.4th 374, 381-389 [requirements for exchange of disclosure declarations did not apply to a prepetition marital settlement agreement]; Hogoboom &King, Cal. Practice Guide: Family Law, supra, ¶¶ 11:40-11:102, pp. 11-8 to 11-35 [mandatory declarations of disclosure under § 2100 et seq.].) In Evans, we set forth an overview of the statutes and, therefore, will not repeat that discussion in this unpublished opinion.
Rather, we turn to the specific provisions relevant to this appeal, which includes section 2105 and the requirement for an exchange of final disclosure declarations. Subdivision (a) of section 2105 provides in part:
"Except by court order for good cause, ... if the case goes to trial, no later than 45 days before the first assigned trial date, each party, or the attorney for the party in this matter, shall serve on the other party a final declaration of disclosure and a current income and expense declaration, executed under penalty of perjury on a form prescribed by the Judicial Council, unless the parties mutually waive the final declaration of disclosure."
Section 2106 restricts what a court may do when final disclosure declarations are not provided, subject to certain exceptions:
"[J]udgment shall not be entered with respect to the parties' property rights without each party, or the attorney for that party in this matter, having executed and served a copy of the final declaration of disclosure and current income and expense declaration. Each party, or the party's attorney, shall execute and file with the court a declaration signed under penalty of perjury stating that service of the final declaration of disclosure and current income and expense declaration was made on the other party or that service of the final declaration of disclosure has been waived pursuant to subdivision (d) of Section 2105 or in Section 2110." (§ 2106; see §§ 2105, subd. (d) [mutual waiver exception], 2017 [good cause exception], 2110 [default judgment exception].)
In this case, the appellate record does not contain a declaration from Wife or her attorney "stating that service of the final declaration of disclosure and current income and expense declaration was made on [Husband] or that service of the final declaration of disclosure has been waived[.]" (§ 2106.) Thus, we conclude that Wife did not comply with her statutory obligation to serve "a final declaration of disclosure and a current income and expense declaration." (§ 2105, subd. (a).)
In comparison, Husband filed an income and expense declaration using form FL-150 the week before the trial. It stated his average monthly wages were $4,492 and his average monthly overtime was $3,158. The declaration reported no rental income and stated his expenses averaged $6,700 per month.
Some consequences of failing to comply with the statutory disclosure requirements are contained in section 2107, which provides that "if 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." (§ 2107, subd. (d).) In addition, subdivision (c) of section 2105 provides: "In making an order setting aside a judgment for failure to comply with this section, the court may limit the set aside to those portions of the judgment materially affected by the nondisclosure."
We note that if the trial court had awarded permanent spousal support to Wife, it is likely it would have been required by the foregoing provisions to set aside that award for lack of a final disclosure declaration. (See generally, In re Marriage of Steiner & Hosseini (2004) 117 Cal.App.4th 519, 526-528 [failure to exchange final declarations of disclosure, by itself, does not compel reversal of judgment; a miscarriage of justice must be shown under constitutional doctrine of reversible error].)
C. Application of Declaration Requirement
We need not undertake a detailed textual analysis of Rule 5.260 to resolve Wife's contention that only Rule 5.260(e)(2)(B) applies to trials. Wife's interpretation of Rule 5.260 must be rejected because it is inconsistent with the statutory requirement for final disclosure declarations. (See Cal. Const., art. VI, § 6, subd. (d).) In comparison, the trial court's determination that it lacked adequate information to award Wife spousal support is consistent with the mandatory disclosure requirements set forth in section 2105, subdivision (a). Thus, we conclude the trial court did not err in setting permanent spousal support at zero and reserving jurisdiction over the issue of support.
Here, the trial court's determination was not simply a rigid adherence to technical legal requirements for their own sake. As a practical matter, Wife's testimony that she was unemployed did not address the income she derived from seasonal employment. Further, the absence of testimony about her monthly expenses prevented the court from making a finding about her current expenses and using that finding in calculating an amount of reasonable spousal support.
IV. ATTORNEY FEES
A. Background
From 2012 through 2020, Husband paid Wife's counsel $20,000 in court-ordered interim attorney fees. Wife's March 2022 trial brief asserted she had incurred $146,230.19 in attorney fees and costs to date. After the April 2022 trial, Wife filed a written closing argument and memorandum of points and authorities that attached billing records showing she had incurred attorney fees and costs totaling $172,662.48 and still owed $149,412.48.
In comparison, the income and expense declaration Husband filed shortly before the April 2022 trial stated he had paid his attorneys $70,000 in fees and costs still owed $10,000. The declaration stated Husband had borrowed the money used to pay attorney fees and listed a $90,000 debt owed to Senior for attorney fees. The amount of debt implies Husband borrowed $20,000 from Senior to pay the $20,000 in court-ordered attorney fees.
The record also contains information about the attorney fees incurred by the claimants. The written closing argument they filed in June 2022 stated they had incurred over $63,000 in attorney fees and costs since the initiation of the litigation. Claimants requested Wife be ordered to pay no less than $35,000 of those fees.
The trial court's statement of decision addressed Wife's request for an award of attorney fees as follows:
"[S]ection 2030 requires the trial court to ensure that each party in a dissolution proceeding has access to legal representation 'by ordering, if necessary based on the income and needs assessments, one party ... to pay to the other party, or to the other party's attorney, whatever amount is reasonably necessary for attorney's fees and for the cost of maintaining or defending the proceeding during the pendency of the proceeding.' (§ 2030, subd. (a)(1).) When a party requests fees under section 2030, the court must make express findings on 'whether an award of attorney's fees and costs under this section is appropriate, whether there is a disparity in access to funds to retain counsel, and whether one party is able to pay for legal representation of both parties." (§ 2030, subd. (a)(2); In re Marriage of Morton (2018) 27 Cal.App.5th [1025], 1050 ..)
"Here, as indicated above, the Court has not been presented with adequate information concerning [Wife's] income and expenses in order to determine whether there is a sufficient disparity in income. Without this information, the Court will deny the request."
A footnote at the end of the second paragraph stated, "that with the community interest in the rental properties as determined by the Court, there is a potential that [Wife] will have sufficient cash from the sale of the properties that she has sufficient access to funds for attorney's fees." It also stated the value of the Glenwood property was unknown and, therefore, the trial court had "insufficient information to determine the parties' respective] access to funds for attorney's fees." The court's statement about the absence of "adequate information concerning [Wife's] income and expenses" refers to the lack of a final disclosure declaration, which the court had discussed in connection with her spousal support claim.
Wife contends the trial court abused its discretion and failed to consider the statutory factors when it decided to deny her request for attorney fees. Although the court's rationale (which is quoted above) did not refer to Rule 5.260, Wife (1) asserts the court relied on that rule to deny her request and (2) contends the rule does not speak to requirements for an award of attorney fees. Wife also contends the court erred by taking into account the award of an interest in the properties as a source covering her attorney fees, which was an improper analysis as a matter of law.
Subdivision (b) of section 2032 provides in part: "The fact that the party requesting an award of attorney's fees and costs has resources from which the party could pay the party's own attorney's fees and costs is not itself a bar to an order that the other party pay part or all of the fees and costs requested. Financial resources are only one factor for the court to consider in determining how to apportion the overall cost of the litigation equitably between the parties under their relative circumstances."
Wife addresses the application of the statutory factors to the evidence presented by arguing a disparity of income between the parties actually was established by the trial court's findings that she was unemployed at the time of trial, Husband was employed and was collecting rent, and Husband owned as separate property the lion's share of the properties acquired during marriage.
In addition, Wife bases her request for attorney fees on the misconduct of Husband and claimants. (See In re Marriage of Nakamoto &Hsu (2022) 79 Cal.App.5th 457, 469 [the parties' tactics may be considered in determining a just and reasonable award of attorney fees]; Darab Cody N. v. Olivera (2019) 31 Cal.App.5th 1134, 1143 [a party's tactics are relevant to evaluating a need-based award of fees]; see also, § 2032, subd. (a) [award of attorney fees must be "just and reasonable under the relative circumstances of the respective parties"].) She contends Husband and Senior engaged in shell game tactics regarding ownership of the properties and those tactics caused her to incur attorney fees to establish the community property interest. She asserts she was required to litigate against two attorneys who, on behalf of their four clients, put forth inconsistent, unverifiable, and ultimately meritless claims during the litigation. For example, she notes the statement of decision mentions some of the inconsistencies, such as (1) the deposition in which Senior testified that he had no ownership interest in the three properties and (2) Husband's contrary assertion that he had no ownership interest in the properties and held title merely for the convenience of his father.
B. Noncompliance with Applicable Rule
The award of attorney fees in marriage dissolution proceedings is governed by chapter 3.5 of part 1 of division 6 of the Family Code, which consists of sections 2030 through 2034. In addition, Rule 5.427(a) provides: "This rule applies to attorney's fees and costs based on financial need, as described in Family Code sections 2030, 2032, 3121, 3557, and 7605." Rule 5.427(b)(1) provides:
"Except as provided in Family Code section 2031(b), to request attorney's fees and costs, a party must complete, file and serve the following documents:
"(A) Request for Order (form FL-300);
"(B) Request for Attorney s Fees and Costs Attachment (form FL-319) or a comparable declaration that addresses the factors covered in form FL-319;
"(C) A current Income and Expense Declaration (form FL-150);
"(D) A personal declaration in support of the request for attorney's fees and costs, either using Supporting Declaration for Attorney's Fees and Costs Attachment (form FL-158) or a comparable declaration that addresses the factors covered in form FL-158; and
"(E) Any other papers relevant to the relief requested."
The exception for attorney fees requests made under section 2031, subdivision (b) applies to certain oral motions made in open court and, thus, the exception does not apply to Wife's request for fees.
An income and expense declaration is current if it was "completed within the past three months, provided that no facts have changed." (Rule 5.427(d)(1).) Also, the form FL-150 "must be sufficiently completed to allow determination of the issues." (Ibid.) Based on Wife's failure to comply with Rule 5.427's requirement for a current income and expense declaration, we conclude the trial court did not err in determining it was presented with inadequate information "to determine whether there was a sufficient disparity in income."
We recognize that section 2030, subdivision (a)(2) states "the court shall make findings on [1] whether an award of attorney's fees and costs under this section is appropriate, [2] whether there is a disparity in access to funds to retain counsel, and [3] whether one party is able to pay for legal representation of both parties." (Italics added.) We have interpreted this provision to mean trial courts are required to make express findings-either in writing or orally on the record-on the three questions set forth in the statute. (In re Marriage of Morton, supra, 27 Cal.App.5th 1025, 1050.) The trial court's statement of decision cited section 2030 and referred to the requirement for express findings adopted in Morton. As a result, it is clear the court considered the statute and the requirement for express findings. Thus, we consider whether the court erred in failing to make express findings on the three questions listed in section 2030, subdivision (a)(2).
We conclude the lack of information identified by the trial court is a legally sufficient reason for not making the express findings required by the statutory interpretation adopted in Morton. As a practical matter, that reason is the equivalent of the court determining "a disparity in access to funds to retain counsel" (§ 2030, subd. (a)(2)) was not established by the record presented-that is, there was a failure of proof. Thus, the statutory factor was adequately addressed in explicit terms.
Also, to the extent Wife argues the trial court committed a legal error by failing to cite an applicable statute or rule of court to support its determination that the information presented was inadequate, we reject that argument because the record shows Wife did not comply with Rule 5.427, the court's decision did not expressly state which statute or rule Wife did not satisfy, the absence of a citation is not prejudicial error. (See Cardinal Health 301, Inc. v. Tyco Electronics Corp. (2008) 169 Cal.App.4th 116, 155 ["trial court is presumed to know and understand the applicable law"].) Thus, we presume the court's determination was based on Rule 5.427.
Although the trial court's determination that it was not presented with adequate information to make a finding about a disparity in access to funds was not error, we conclude the partial reversal of the judgment for failing to order an accounting, when considered with the other circumstances of this case, justifies reversing the denial of attorney fees. In particular, the further proceedings on remand will include (1) either a sale or agreement establishing the value of the community's 29.9 percent interest in 1307 Glenwood, which will also determine the value of Husband's 70.1 percent interest; (2) a sale of 1016 7th Avenue or payment terms for the community's $136,000 interest in that property; and (3) the accounting described in part II.C. of this opinion. The accounting will remedy, in part, the failure of Husband's income and expense declarations to disclose any rental income. Thus, the further proceedings on remand will materially improve the ability of the parties to address the statutory factors relevant to the award of attorney fees.
Our approach is essentially the same as modifying the denial of attorney fees to be without prejudice to a reapplication for fees after the further proceedings on remand have clarified the parties' respective financial circumstances.
DISPOSITION
The judgment is modified to state Husband's separate property interest in 1307 Glenwood is 70.1 percent, not 71.1 percent. The judgment, as modified, is reversed in part and affirmed in part as set forth below.
The judgment is reversed to the extent it did not require an accounting of the postseparation income and expenses attributable to the community's interest in 1307 Glenwood and 1016 7th Avenue. On remand, the trial court shall order Husband and claimants to provide such an accounting on terms not inconsistent with this opinion. After the accounting is completed, if the matter is not resolved by agreement of the parties, the trial court shall conduct further proceedings to award Wife her share of the community's interest in the properties' net income from the date of separation until the final distribution of the community's interest.
The judgment is reversed to the extent it denied Wife's request for attorney fees and costs. The issue of attorney fees is at large and Wife may submit a new request after the proceedings on remand.
The judgment is affirmed as to its characterization of the three rental properties and its determinations that (1) the community has a 29.9 percent interest in 1307 Glenwood and a $136,000 interest in 1016 7th Avenue, (2) Evelyn Berumen had 90 days to satisfy the community's $136,000 claim, and (3) the parties had 90 days to agree on an amount to reimburse the community for 29.9 percent interest in 1307 Glenwood and, if an agreement is not reached, any party may thereafter seek a court order for the sale of the property.
The judgment also is affirmed as to its setting of permanent spousal support at zero and reserving jurisdiction over the issue.
Wife shall recover her costs on appeal.
WE CONCUR: MEEHAN, J. DE SANTOS, J.