Marriage of Zellet CA2/6
B268640
| Cal. Ct. App. | Aug 18, 2016Background
- Donald and Marilyn Zellet married ~35 years; separated 2005; dissolution petition filed 2010 with automatic temporary restraining orders (ATROs) prohibiting disposition of community property without consent or court order.
- In April 2011 Donald received $1,056,000 from a community investment (Pagoda); he gave Marilyn $110,000 cash and a $25,000 car but kept/spent the remainder without informing her.
- Donald spent the remaining proceeds on gifts for adult children, vehicles, travel, investments and other expenses; Marilyn knew he was spending money but did not know the funds were her community share.
- Marilyn repeatedly requested her half in cash; Donald refused to provide an accounting and admitted uncertainty about what he told her; trial court found his testimony evasive and that he violated the ATROs and fiduciary duties.
- Trial court ordered Donald to pay Marilyn $395,500 plus a portion of future Pagoda distributions, denied Donald’s belated request for spousal support, and awarded Marilyn attorney fees and costs under Family Code §2107(c).
- Donald appealed, challenging the rejection of equitable defenses (estoppel, laches), the denial of spousal support and the attorney-fee rulings.
Issues
| Issue | Plaintiff's Argument (Donald) | Defendant's Argument (Marilyn) | Held |
|---|---|---|---|
| Whether Marilyn is equitably estopped from claiming half of Pagoda proceeds | Marilyn knew money was being spent and waited; estoppel bars her recovery | Marilyn was not fully apprised that community funds were being spent; Donald kept her in the dark | Trial court properly rejected estoppel; substantial evidence supports finding Marilyn lacked full knowledge and Donald concealed facts |
| Whether Marilyn’s claim is barred by laches | Marilyn waited too long and only asserted claim after funds spent | Donald’s wrongdoing (ATRO violation, concealment) prevents laches; he lacks clean hands | Laches rejected because Donald’s inequitable conduct foreclosed the defense |
| Whether trial court abused discretion by denying Donald spousal support and terminating jurisdiction | Donald sought support belatedly at trial; court abused discretion in denying and terminating jurisdiction | Donald waived/delayed claim; Marilyn prejudiced by five-year delay; Donald also failed to prove entitlement under §4320 | Court did not abuse discretion: claim barred by laches/waiver/estoppel and Donald failed to show need or entitlement; jurisdiction properly terminated because parties self-supporting |
| Whether fee awards were improper due to disclosure noncompliance; and whether §271 fees for Marilyn were warranted | Marilyn failed to serve current disclosures so §2107(d) bars award; alternatively trial court should award Donald fees under §271 | Fee award justified under §2107(c) because Donald breached fiduciary duties and concealed assets; §271 not warranted for Donald because his conduct caused litigation | Disclosure noncompliance did not show miscarriage of justice on appeal; fee award affirmed under §2107(c); denial of Donald’s §271 request affirmed as within discretion |
Key Cases Cited
- Driscoll v. City of Los Angeles, 67 Cal.2d 297 (1967) (elements of equitable estoppel)
- In re Marriage of Kelkar, 229 Cal.App.4th 833 (2014) (standard of review for estoppel findings in family law)
- Precision Instrument Mfg. Co. v. Automotive Maintenance Machinery Co., 324 U.S. 806 (1945) (clean-hands maxim bars equitable relief for those guilty of inequitable conduct)
- Johnson v. City of Loma Linda, 24 Cal.4th 61 (2000) (laches requires unreasonable delay plus acquiescence or prejudice)
- In re Marriage of Cheriton, 92 Cal.App.4th 269 (2001) (importance of marital standard of living in awarding spousal support under §4320)
- In re Marriage of Fong, 193 Cal.App.4th 278 (2011) (family-law sanctions and attorney fee awards for failure to disclose/comply)
- In re Marriage of Steiner & Hosseini, 117 Cal.App.4th 519 (2004) (disclosure noncompliance and prejudicial effect analysis)