Prentis-Margulis v. Margulis
198 Cal. App. 4th 1252
| Cal. Ct. App. | 2011Background
- Husband and wife separated after 33 years; husband controlled substantial community assets postseparation and managed finances; postseparation investments largely depleted with no corroborating records; Elaine as nonmanaging spouse presented exhibit 18 claiming significant missing assets; trial court refused to shift burden and did not credit missing assets beyond $184,390 of IRA funds; equity division required Elaine to make large equalizing payment or sell Sycamore house; court sanctioned Alan for fiduciary breach and awarded fees; on appeal, judgment reversed requiring retrial and proper burden shifting.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Burden shift on missing postseparation assets | Margulis: Elaine proved assets existed; missing assets require shift | Margulis: Alan argues no predicate; See Bono or no shift | Yes; burden shifts to managing spouse to prove disposition or lesser value |
| Evidence sufficiency of exhibit 18 | Elaine's exhibit 18 proves asset values postseparation | Alan: exhibit 18 unreliable; outdated; lacks community vs separate property split | Exhibit 18 admitted as prima facie evidence; burden shifts to Alan to rebut values |
| Reimbursement for postseparation payments | Epstein credits should reimburse if payments came from separate funds | No tracing of separate funds; White's testimony insufficient | Reversal; on remand, limit reimbursement to payments proven to arise from separate property; traceable evidence required |
Key Cases Cited
- Williams v. Williams, 14 Cal.App.3d 560 (Cal. Ct. App. 1971) (missing assets must be accounted for to achieve equal division)
- In re Marriage of Ames, 59 Cal.App.3d 234 (Cal. Ct. App. 1976) (managing spouse bears burden to account for missing assets)
- In re Marriage of Valle, 53 Cal.App.3d 837 (Cal. Ct. App. 1975) (burden of proving disposition of assets lies with managing spouse)
- In re Marriage of Priddis, 132 Cal.App.3d 349 (Cal. Ct. App. 1982) (valuation date considerations; managing spouse must show disposition)
- Bono v. Clark, 103 Cal.App.4th 1409 (Cal. Ct. App. 2002) (limited applicability; not controlling burden shift in all missing asset cases)