Opinion
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
Appeal from an order of the Superior Court of Orange CountySuper. Ct. No. 02D007971, Walter D. Posey, Temporary Judge. (Pursuant to Cal. Const., art. VI, § 21.) Affirmed.
Yen Nguyen for Appellant.
Jeffrey S. Graff for Respondent.
IKOLA, J.
Appellant Thang Quoc Ho (husband) appeals from an order granting the motion of respondent Maiphi Nguyen (wife) to set aside a default judgment. The court found husband obtained the default judgment through actual fraud and perjury. Substantial evidence supports its findings. Substantial evidence also shows wife timely filed her motion upon discovering the fraud. We affirm.
FACTS
Husband petitioned to dissolve his 12-year marriage to wife in 2002. Wife filed no response. At husband’s request, the court entered wife’s default. Husband filed a schedule of assets and debts indicating he owned the family home, with $318,000 in equity, as his separate property. The court entered a judgment of dissolution. The judgment attached and incorporated an agreement executed by husband and wife before a notary public (Attachment A). The attachment awarded the family home to husband as his separate property.
Husband applied for a temporary restraining order (domestic violence) in July 2006, and moved to enforce the judgment in August 2006. In a declaration submitted in support of his motion, he stated he and wife had owned the family home as community property and held title to it as joint tenants. He noted wife had refused to execute a quitclaim deed transferring sole title to him pursuant to the judgment. He sought to have the court clerk execute the quitclaim deed.
Wife responded by moving to set aside the default judgment. She asserted the grounds of actual fraud and perjury.
In a declaration, wife explained how husband defrauded her. She stated husband told her not to respond to court filings, resulting in the entry of default. Husband also told her she needed to execute Attachment A so the government would allow husband’s relatives to immigrate. He told her the agreement would be used only for immigration purposes, would not be filed with the court, and would not affect their marriage, their home, or their community property. In fact, the two continued to live as though married, sharing the same bed, having sexual relations, filing joint tax returns, and holding themselves out as husband and wife. Wife relied upon husband’s representations in executing Attachment A. He did not let her read it, and she was not represented by counsel. She did not understand the agreement, know it had led to a judgment of dissolution, or realize it deprived her of her community property interest in the home until husband applied for the temporary restraining order and she met with an attorney.
Wife also explained husband’s perjury. She stated they bought the home during the marriage as husband and wife. Husband knew the home was community property, as further evidenced in his declaration acknowledging the home’s community property status. Nonetheless, husband falsely indicated on the schedule of assets and debts the home was his separate property.
Husband filed his own declaration opposing the motion. He stated wife executed Attachment A “with full knowledge and consent, without undue influence or misrepresentation from me.” He claimed wife agreed he should be awarded the house as his separate property because he would be the primary custodian of their six children. He denied telling wife the attachment involved immigration. He claimed he kept living with wife because she “realized that living independently would be too challenging for her.”
The court denied husband’s motion to enforce the judgment and granted wife’s motion to set it aside. It expressly relied upon a statute authorizing courts to vacate family law judgments on the grounds of actual fraud and perjury. (Fam. Code, § 2122, subds. (a), (b).) It found husband intentionally misled wife about their dissolution. It further found Attachment A gave husband an unfair advantage over wife, giving rise to a presumption that husband obtained her consent through undue influence. It also found wife’s motion was timely because she filed it within one year of discovering husband’s fraud. Accordingly, the court vacated the default and set aside the judgment except as to marital status.
All further statutory references are to the Family Code unless otherwise stated.
DISCUSSION
The Family Code allows a court to set aside a judgment of dissolution “on any terms that may be just . . . after the six-month time limit of Section 473 of the Code of Civil Procedure has run.” (§ 2121, subd. (a).) The court may set aside a judgment for “[a]ctual fraud where the defrauded party was kept in ignorance or in some other manner was fraudulently prevented from fully participating in the proceeding.” (§ 2122, subd. (a).) It may also set aside a judgment for “perjury in the preliminary or final declaration of disclosure, the waiver of the final declaration of disclosure, or in the current income and expense statement . . . .” (§ 2122, subd. (b).)
Substantial evidence supports the court’s finding of actual fraud. (See In re Marriage of Bonds (2000) 24 Cal.4th 1, 31 (Bonds) [extrinsic fraud is question of fact reviewed for substantial evidence].) Wife’s declaration indicated husband told her not to respond to court filings. He also told her to execute Attachment A for immigration purposes only, that it would not be filed with the court, and that it would not affect their marriage or their community property. Indeed, husband continued to live with wife as husband and wife after she signed the agreement, perpetuating his misrepresentations and inducing her not to challenge the default judgment. Wife also stated she relied upon husband’s representations, did not retain counsel, and did not read Attachment A. Her declaration sufficiently supports the court’s finding that husband’s actual fraud “kept [wife] in ignorance” and “fraudulently prevented [her] from fully participating in the proceeding.” (§ 2122, subd. (a).)
Similarly, substantial evidence supports the court’s finding of perjury. Husband filed a schedule of assets and debts as part of his declaration of disclosure. In the schedule — in which husband declared “under penalty of perjury under the laws of the State of California that the foregoing is true and correct” — husband stated he owned the family home as his separate property. But wife’s declaration indicated the couple bought the home together during the marriage as husband and wife. “[A]ll property . . . acquired by a married person during the marriage . . . is community property.” (§ 760.) And husband conceded in a declaration, “[wife] and I owned as community property the [family home].” This evidence sufficiently shows husband willfully declared to be true a statement known to be false, and did so under the penalty of perjury. (See Pen. Code, § 118 [elements of perjury].) Thus, substantial evidence supports the finding that husband committed perjury in his final declaration of disclosure. (§ 2122, subd. (b).)
Each party to a dissolution must serve upon the other party a preliminary declaration of disclosure setting forth, among other things, “all assets in which the declarant has or may have an interest and all liabilities for which the declarant is or may be liable . . . .” (§ 2104, subd. (c)(1).) Parties must also file a final declaration of disclosure, unless they agree otherwise in writing or the matter proceeds as a default judgment. (§§ 2105, subds. (a), (d), 2110.) The disclosures must be made on mandatory Judicial Council forms, including the “Schedule of Assets and Debts” form submitted by husband. (§ 2105, subd. (a); see also Hogoboom & King, Cal. Practice Guide: Family Law (The Rutter Group 2007) ¶¶ 11:60 to 11:62, pp. 11-13 to 11-14.) The actual final declaration itself is not in the record on appeal. This is unsurprising, as the declaration must only be served, not filed. (§ 2105, subd. (a).) The record does contain husband’s declaration that he served a final declaration of disclosure on wife (not required due to wife’s default, § 2110) on the same date he executed the schedule of assets and debts. All this strongly suggests husband filed the schedule as part of his final declaration of disclosure.
Despite the court’s and the parties’ extensive focus on the issue of undue influence, it is not clear the judgment may be set aside on that ground. Section 2122 sets forth six grounds for setting aside a judgment: actual fraud, perjury, duress, mental incapacity, mistake of law or fact in a stipulated or uncontested judgment, and failure to comply with disclosure requirements. (§ 2122, subds. (a)-(f).) Undue influence is not listed. The court and the parties seem to treat undue influence as an alternative basis for the finding of actual fraud, though that is not necessarily true. “Undue influence is not always the equivalent of fraud. One may exist without . . . the other.” (Estate of Newhall (1923) 190 Cal. 709, 718 [distinguishing grounds for will contests]; accord Civ. Code, §§ 1567, 1572, 1575 [distinguishing grounds for vitiating consent to contract].)
But for what it is worth, substantial evidence supports the court’s finding of undue influence. Spouses owe each other fiduciary duties “of the highest good faith and fair dealing . . . .” (§ 721.) Thus, “whenever [spouses] enter into an agreement in which one party gains an advantage, the advantaged party bears the burden of demonstrating that the agreement was not obtained through undue influence.” (Bonds, supra, 24 Cal.4th at p. 27.) To trigger this presumption of undue influence, the advantage gained “must necessarily be an unfair advantage.” (In re Marriage of Burkle (2006) 139 Cal.App.4th 712, 730 (Burkle).) “Whether an inter spousal transaction gives one spouse an unfair advantage is a question for the trier of fact.” (Id. at p. 734.) And “‘whether the spouse gaining an advantage has overcome the presumption of undue influence is a question for the trier of fact, whose decision will not be reversed on appeal if supported by substantial evidence.’” (Id. at p. 737.)
Wife gave up her $159,000 community property interest in the home through Attachment A, in exchange for no readily apparent consideration. “[N]umerous cases apply the presumption of undue influence when the marital transaction is one in which one spouse deeds his or her interest in community property to the other spouse, for no consideration or for clearly inadequate consideration.” (Burkle, supra, 139 Cal.App.4th at p. 731.) Husband claims wife agreed to give up her community property interest in exchange for his agreement to take primary physical custody of their children and waive spousal support. But husband and wife continued to live together in the home and raise the children together, putting the lie to these claims. And husband cites no evidence showing any entitlement to spousal support from wife. The record sufficiently shows husband obtained an unfair advantage in Attachment A, giving rise to a presumption of undue influence that husband failed to rebut. (See Bonds, supra, 24 Cal.4th at p. 27; Burkle, supra, 139 Cal.App.4th at pp. 730-731, 734, 737.)
Contrary to husband’s claim, the court did not improperly set aside the judgment due to an inequitable asset division. The Family Code chapter governing relief from judgment provides, “[n]otwithstanding any other provision of this chapter, or any other law, a judgment may not be set aside simply because the court finds that it was inequitable when made.” (§ 2123; accord In re Marriage of Heggie (2002) 99 Cal.App.4th 28, 36-37 [reversing order setting aside stipulated judgment due solely to financial inequity].) But the court did not set aside the judgment because it was inequitable. It set aside the judgment because husband obtained it through actual fraud and perjury. (§ 2122, subds. (a), (b).) And while the inequity creates a presumption of undue influence, it alone does not establish undue influence. The advantaged spouse may rebut the presumption. (Burkle, supra, 139 Cal.App.4th at p. 737.) It is husband’s failure to do so, not the unfair advantage itself, that establishes undue influence.
Finally, substantial evidence shows wife’s motion was timely. A motion to set aside a judgment for actual fraud or perjury must be brought within one year from the date the moving party discovered, or should have discovered, the fraud or perjury. (§ 2122, subd. (a), (b).) When wife discovered or should have discovered husband’s fraud and perjury are questions of fact, reviewed for substantial evidence. (City of San Diego v. U.S. Gypsum Co. (1994) 30 Cal.App.4th 575, 582 [statute of limitations is generally a question of fact]; Enfield v. Hunt (1984) 162 Cal.App.3d 302, 310 [finding on delayed discovery reviewed for substantial evidence]; April Enterprises, Inc. v. KTTV (1983) 147 Cal.App.3d 805, 833 [delayed discovery is question of fact].) In her declaration, wife stated she discovered the fraud and perjury in July 2006, when husband applied for a temporary restraining order and she met with a lawyer. This evidence sufficiently supports the court’s finding that the motion was timely.
DISPOSITION
The order vacating the default and setting aside the judgment of dissolution except as to marital status is affirmed. Wife shall recover her costs on appeal.
WE CONCUR: ARONSON, ACTING P. J., FYBEL, J.