*1 Dist., May A021867. First Div. [No. Five. 1985.] In re the of JOAN ELMER BERGMAN. F. and A. BERGMAN,
JOAN F. v. Respondent, BERGMAN,
ELMER A. Appellant. [Opinion certified for partial publication.*] publication VI published, they *Parts and VII are not do not meet standards because Court, 976(b). contained in rule California Rules *5 Counsel Anderson, Glen
Cheryl Tim Provis and Elmer A. Bergman, per., pro. for Appellant. Wesselius,
Sharon L. Gazzea & Antonioli Bernard N. Wolf and Dowgialo & Wolf for Respondent.
Opinion disposing KING, J. In this case we hold that in pension plan ,the pos interest in a in marital dissolution actions trial court spouses, sesses broad discretion to choose to divide it in kind between the employee spouse accomplish or to award it to the at its value and equal community property by offsetting an division of an award of other Although may dividing assets. trial courts not refrain from the com munity pension plan, community property, interest in a as with other may temporarily jurisdiction during court reserve to divide it at a later time pendency litigation. of the dissolution We also hold that the trial court, accomplish equal community property, may in order to an division of require spouse community property a awarded more than one-half of the promissory spouse execute a secured short-term note in favor of the other Fam Finally, although of interest. which bears a reasonable rate a determination fees based ily attorney Law Act authorizes award hold trial court in dissolution we that the ability need and to pay, if that party party’s also fees attorney against proceedings impose unnecessary faith frivolous cause tactics or actions based on are good delay. of dissolution
Elmer from an Bergman appeals interlocutory judgment orders to also from his to Joan He marriage Bergman. subsequent appeals interloc- residence, vacate family denying modify and his motion her Joan but utory cross-appeal.1 later dismissed judgment. cross-appealed, and, as We to Joan’s modify language judgment pension plan as modified, the are judgment and orders affirmed.
I. Facts 19, Joan and Elmer were August separated April married children, trial. 1980. had five minors at the time of They two whom were Prior Elmer was in federal civil from 1961 until 1976. employed service he military had almost two service marriage performed years 1976, as a counts as service federal retirement. In towards his longevity result of became permanently severe Elmer developing hypertension, time. disabled. He has since that totally been receiving disability pension retire- Pursuant to his Elmer eligible longevity becomes pension plan be ment he reaches time his benefits will when 62 in 1997 which age retirement.2 recomputed longevity *6 teach- the at She was a school Joan worked several
During marriage jobs. working er at the she the time of but sometime thereafter started separation, for a she made contribu- tax As a teacher for planning eight years service. tions California After System. separation to the State Teachers’ Retirement family Joan and the minor children moved out of the residence. issues, a trial on and other community the division
Following
property
interlocutory judgment
the court issued a statement of decision and an
interlocutory
an
vacating
setting
obtained
aside
earlier
previously
1Joan
an order
and
order,
not review
we need
judgment.
appeal
granting
Since no
taken from the
of that
was
setting it
or the order
aside.
prior
conjunction
in
with it
judgment,
the
documents executed
38], the
(1979)
Cal.Rptr.
122
Marriage
2Applying
[158
In re
Samuels
community
disability
separate rather than
correctly ruled
benefits are
trial court
that Elmer’s
retirement,
however,
community
eligible
longevity
for
there is
property;
upon becoming
(See
(1978)
Marriage
II. The Pension Plans a. Method of division.
Elmer’s contention is abused primary that the court its discretion by to divide the defined failing community interest in benefit his pension basis; on in kind an the It instead court used the cash out method.4 determined the present value of interest in Elmer’s community property him, pension awarded it to and an award of plan, gave offsetting other contends, Joan. Elmer also even if this was not property discretion, abuse of value court erred of the com fixing present munity $86,000. interest his at pension plan 3Unpublished portions family of this consider of the award of appeal decision Elmer’s part residence to Joan as of her and half of contentions of clerical error. 4For purposes plans, our will appropriate discussion of it is to define terms we which, using. be Elmer’s pension plans plans Both and benefit their Joan’s were defined cases, particular receive, required by employee. benefit each will contributions The however, depend employer, does not on the dollars contributed them or their but based is factors, achieved, on a highest years combination of at including income level of service age retirement and nec present plan, retirement. To determine the value of such a it is essary actuaries, expert testimony, normally presented. testimony from be This includes factors, only value, economic, expert’s opinion present as to but what health otherwise, expert reaching opinion. considered in his may (a rights discharge voluntary Pension be which or right vested survives the termina- (a tion employee), right requires nonvested additional service to become vested). may right right (employee also be matured has an unconditional to retire payment benefits) obtain (See though immediate even has not to retire. employee chosen 633, In re Brown 15 Cal.3d 544 P.2d 164].) 94 A.L.R.3d discuss, Community pension plans, disposed interest defined as we be benefit shall (the of in dissolution actions entire at its a cash out value employee awarded spouse offsetting spouse to the with to the other ac- assets awarded *7 division) (the complish community equal an division in kind interest is divided a usually between and parties, plan, payable, separate the the benefits become makes when payments interest). according to each proportionate to their plan As to a the plan, contrasted defined benefit other kind of retirement is a defined plan employer’s obligation contribution where the its annual The is related to contribution. employee upon depends upon employee’s benefit for the retirement the value account at of a testimony present that time. There is no need to the value expert for determine plan defined of contribution at dissolution because its value is the amount contributions made thereon, marriage separation, between the and accruals all accruals thereon between plus and the separation date of and trial of the issue.
749 choosing the court’s We the claimed abuse of discretion first address in El- interest community to cash Joan’s interest the entire out and award has broad the trial court marriage, mer’s to him. dissolution of a plan Upon in a spouse’s of interest community discretion in the division property in two ways. and can discretion either of exercise its pension rights community trial value of property court either determine the present or other community and award them to one with rights offsetting spouse divide method), out or it may assets to the other called the cash (commonly reserving jurisdiction interest in kind between the community spouses, Brown, (In Marriage to future re supervise to each payments spouse. of Brown, 848.) 15 in our supra, Supreme Cal.3d at Prior to its decision p. feasible, award Court trial court to had indicated a when preference, interest in or her all of the his employee spouse community pension with of rights equal and other other compensate spouse 32, value. 46 (1970) v. Board Administration 3 Cal.3d (Phillipson [89 of 61, Mar- 765], 473 P.2d on other in In re Cal.Rptr. grounds disapproved Brown, However, 14.) 15 riage deciding at 851 fn. supra, Cal.3d p. of Brown, the and ex- Court referred to its statement in Supreme Phillipson trial stated it had not thus the pressly intended to specify preference; “court fashion retains the discretion assets to divide (In re with the of Civil Code section 4800.” complies provisions Brown, 10; re Mar- 15 848 fn. also In Marriage supra, Cal.3d see of 615, (1977) 679, 566 riage Skaden 19 688 P.2d Cal.3d Cal.Rptr. [139 249]; 304, In re 312 Marriage 57 Freiberg [127 792], in In Gillmore Cal.Rptr. on other re disapproved grounds 1].) Cal.3d P.2d
Here, value both evidence from on parties presented experts The court of Elmer’s benefits of them. and his pension probability receipt interest in those exercised its discretion in favor of awarding Elmer, benefits assets Joan to solely accomplish awarding offsetting discretion, its division. It is clear the court did in fact exercise equal while, it since utilized the cash out of Elmer’s pension method to dispose later, we in Joan’s pension shall discuss it divided the interest benefits in kind. on is based
Elmer’s chief criticism the court’s exercise discretion of his longevity his that due to his health the actual receipt contention poor trial court too for the retirement benefits is uncertain speculative him, of the risks since all choose the alternative of a out to places cash of no which holds We know case of future of benefits on him. receipt out discretion to cash the court its one health condition spouse’s deprives instead compels other the former’s spouse’s factors many Health one only We decline hold. division kind. to so *8 750
to be considered by the trial of Elmer’s longevity value retire- judge. ment is benefits less than be would true. The speculative usually parties that 89.1 stipulated of his of were percent years service during marriage and additionally should be stipulated there a 25 reduction in the percent present value his to take into account his pension rights health and poor the increased risk of his death. because of his early Additionally, disability, there is no need to would speculate about what advances he make up career or how Thus, ladder he would many years work after as separation. value, fixing can be done with than greater would certainty normally be true.
It is true that Elmer’s life reduced is a factor to be used not expectancy value, only but determining also in how the trial deciding court should exercise discretion in awarding community interest in All pension benefits.5 other being where things equal, employee spouse has health significant trial problems, very court could well find that an in kind distribution is the method which is to both most fair How- parties.6 ever, counsel, depending evidence presented arguments and the there are numerous factors the court consider in how to may determining exercise its discretion to divide interest in community property pension rights, to be to each weight is within the given peculiarly purview of the trier of fact.
The other alternative method of share of awarding pension rights or benefits is to divide that share between the in kind. The parties court will use the usually time rule allocate and separate (In interests re Judd 68 522 Marriage Cal.App.3d [137 318]; In re Cal.Rptr. 57 Marriage Freiberg, supra, Cal.App.3d 310), (See but is not so. to do In re required Poppe utilized a system rather point 500] [court than a circumstances].) strict time rule because of factual comprehensive 5One the more might lists factors that be considered is set forth in Prac.), Rep. 1979 Cal. Fam. L. (reproduced 1050-1051 as chart 5 in Cal. Fam. Law we attach opinion Changes as exhibit this for the benefit of and bar. the bench in the considered, law publication including since the of this chart should be the enactment Congress (Pub.L. 98-369) of the Domestic Reform Relations Tax Act of 1984 No. and the (29 Retirement Act of Equity seq.) requires private U.S.C. 1001 et which now § opposed plans public provide survivorship spouses spouses. benefit and former respected expert 6One domestic relations actuarial the view that expressed has the fairest method, disposition pension plans interests in is the cash out not a division Value,” Review, Projector, Fair Value is a Family kind. See “A Fair Law News and County Angeles actuary looking No. Bar Association. Of Los course the at the interest in the isolated from all other factors which the trial court consider exercising between a cash out a division in its discretion kind.
751 section 632 of Civil Procedure Elmer exercised his to Code right pursuant of respon- on the issue of “distribution a statement of decision request re- by benefits until received than reservation of dent’s retirement rather to cash indicated it chose in of decision The court its statement spondent.” of award Joan (1) property were sufficient assets to out Joan because: there division, (3) value, (2) justified the economic circumstances equal in since it resulted the court felt mode of division this was preferable Thereafter, in a for request to the pension rights going employee spouse. decision, it was unclear what Elmer indicated clarification of statement of the distribution justify economic circumstances the court relied upon that the his a clarification which stated retirement The court issued plan. of Elmer’s receiv- court had relative to the uncertainty considered the issue and extent of his in of the nature retirement but had decided ing rights light need to have an workable prac- and the property equitable, award the tical division of to exercise its discretion to property, in the its value. present interest to Elmer based pension rights trial guidelines Because is not possible develop comprehensive divide in kind com- court’s to follow in out or whether cash deciding reached primarily interests in and because this decision is munity pensions, considerations, courts appellate and factual weighing equitable courts of trial should not second the exercise of the broad discretion guess (See In re that discretion. in the absence a clear of an abuse of showing 473]; In re Marriage Cal.Rptr. Emmett 109 Cal.App.3d [169 298].) Elmer Adams 64 Cal.App.3d has not an abuse of discretion sustained his burden of demonstrating court; in his trial the award to Elmer of must therefore stand. pension plan
b. Valuation of Elmer’s pension. value of the
Elmer next fixing present contends the court erred in the amount retirement benefits community interest his longevity to the $86,000. from actuaries as testimony Each party presented expert be entitled to Elmer would value of the benefit longevity pension present indicated, the of 62 in 1997.7 As previously receive upon attaining age (89.1 were community benefits which to the stipulated percentage parties because be made value which should and the reduction present percent), these (25 figures reaching Both used experts of Elmer’s health percent). their valuations. 2, ante.
7See footnote The actuarial method for both employed by is an experts parties ap propriate method for determining value benefits to *10 be received in (In 679; future. re Marriage of Skaden, 19 Cal.3d supra, In re Marriage (1978) 388, Kasper 83 391-392 Cal.App.3d [147 821].) Cal.Rptr. Joan’s his that the expert expressed value opinion present of Elmer’s $156,225 retirement benefits was with the share of $139,196. 89.1 percent being the value Reducing further because of the 25 stipulated health, reduction percent for Elmer’s ill Joan’s reached expert his that opinion the present value of the in interest $104,397. benefits was Elmer’s expert, the same utilizing essentially pro cess, reached an opinion that the present value $61,200. was There were differences in the of the two assumptions experts which caused them to value, reach different as to the in opinions present the fact that cluding Elmer’s used a discount rate of 10 expert while percent Joan’s 8 used expert percent. There was also a difference of view between them as what the differential would be between future increases costs of and future living differences, interest rates. These with the as differences in their value, as to opinions were present based exercise of their professional which judgment, must be weighed by trial court.
Elmer $86,000 that the argues value of found present the court was by erroneous. On he appeal $2,126 values from suggests present ranging $27,200. There is no evidence in the record to his val- support suggested uations. Unfortunately, there is also record forth the nothing setting trial judge’s calculations. There was by no Elmer for the trial request judge $86,000. supply calculations which he arrived at the by figure While it is true Elmer a statement of decision on the requested issue of “valuation of respondent’s retirement to Code of Civil pension” pursuant 632, Procedure section the trial court in its statement of decision stated that it “finds that the value of to retirement benefits after 62 right age [Elmer’s] $86,000 was at the time of trial.” Since Elmer did not ask for the calcula- value, tions the court reached this the court’s in its response statement of decision was sufficient. We must assume that satisfied response Elmer, decision, since in his for a request clarification of statement he did not ask for a statement of the calculation which the court arrived $86,000; value of he only asked for a statement that the court had considered the of his uncertainty his retirement its receiving reaching decision to choose the cash out method rather than an in kind division. Under these all circumstances inferences are indulged support of the trial court and we finding examine the record to if simply determine evidence there is substantial it. support trial recently,
Until courts seemed to almost unlimited discretion possess values, to fix as the value selected long fell between the and low high witnesses, and the trial values in the expressed opinions experts’ (See re Marriage court’s value was evidence. In substantial supported by Webb 344-345 tes- Cal.Rptr. [expert Cal.App.3d [156 334] $31,468 value to of business of zero dollars timony gave goodwill $16,000]; affirmed value was In re respectively; holding Fortier [testimony 389-390 915] on value zero dollars experts of business from goodwill up $300,000; $10,963].) affirmed value fixed at of these been in the recent decision of approach cases has questioned
In re Hargrave 163 Cal.App.3d of 764], There the husband and his testified there was no asset of experts in the goodwill The of out that business. Court Appeal pointed because, the referee the for hearing testimony case that properly rejected reasons stated in the it did with the law. The wife’s not opinion, comply $100,000, testified there and wife experts argued was valued at goodwill since the the of husband and his to be testimony disregarded, had experts $100,000. evidence only left in the record had a value of was that goodwill However, the court in not bound to out that a is Hargrave judge pointed the to de- accept of The court reviewed the record testimony any witness. termine whether there was evidence to the value support substantial $35,000 for goodwill found the referee and the trial court. by adopted by reversed, court evidence in the record appellate there was no finding to $35,000 a value support for that valuation of goodwill goodwill referee, should not be an decision. The court stated: “The arbitrary having valuation, decided to all of the reject on the testimony subject goodwill was left with a Under that record barren of evidence on this vital issue. circumstance the referee to furnish addi- should have required parties tional evidence or to on that testify he should have his own expert appointed (See Code, 355.) 460.)” (163 issue. Thus all Evid. at § on fact no evidence the value of was the trier of leaving goodwill rejected, $35,000. on determine basis which to there of a value of was goodwill the trial in the broad discretion makes Normally court exercise its on determination of value based evidence independent upon presented the factors to be each. The trial court is considered and the to weight given to to the value of an asset.8 as required opinion any expert accept fixing family 8The Each typical example most is the of the value of a residence. side residence, sales, present testimony expert including comparable information about the eco factors, leading expert opinion nomic and other all to how that reached his or her conditions may accept, reject, give great weight as to value. The little or to each factor and court high opinions experts. between the and low therefore conclude the value is somewhere attorney expert opinions part judges recognize going present Trial that no skillful to least, are, say unfavorable to his client. his case hold, We case, under the circumstances of that the this of Har- holding grave is inapplicable. Here the court listened to extensive expert testimony actuaries by called each The court party. each rejected opinion expert as value but present nonetheless was with sufficient presented evidence in the course of their testimony reach its own de- independent termination of the value of Elmer’s benefits based this pension evidence the court weight gave it. is a better Although practice for courts in their statements decision to set forth the calculations by which they therein, arrive at values of assets or the interests failure to do so Here, does not constitute reversible error. since there is substantial $86,000 evidence the record to the court’s value of support and since Elmer never for asked the court’s calculation to be included decision, the statement of there is no reversible error. Elmer’s for request a statement of was, best, decision on the issue of the value of his request court, dollar specific amount of value found not a for the request calculation by which the court determined that value. If Elmer calculation, wanted the court to set forth its should have request been made his for a statement of decision.9 As indi- request previously cated, since Elmer’s later *12 for clarification of the statement of deci- request sion calculated, raised no issue with to value or how it had been regard court was in justified its statement of decision believing original re- fully to Elmer’s sponded for a statement of decision on the value of the request in community interest his pension plan. $86,000
It appears court reached by its value of the discount rejecting rate utilized by each of the its own rate somewhere in experts applying between. This it is entitled to do. the court have used a Additionally, between figure those used the differential that actuaries for would occur in the future between the in increase cost of and interest rates. living final
Elmer’s
about the trial
of a
complaint
court’s determination
value for the
interest in his
community
is that it “failed to take
pension plan
into account
diminution
Federal or
While it
State taxes.”
is true that
Elmer’s
will to
benefits
some extent be
to state and federal
longevity
subject
1997,
income taxes when he
to draw
in
them
these tax
begins
consequences
are not immediate and
and thus were
specific
disregarded by
properly
trial court in
(See
value.
In re
determining present
Fonstein
873,
1169];
Cal.3d 738
Cal.Rptr.
Weinberg
P.2d
v.
[131
Elmer contends the trial court abused interest over the jurisdiction community property reservation open-ended Joan out of his Joan’s since the court cashed pension plan, especially him, to her to and awarded it to an award making offsetting Joan that the replies division of accomplish equal community property. trial over the community court has broad discretion to reserve jurisdiction when benefits become interest and to divide that interest pension plans payable.
Thus, court made the best as to whether the trial parties disagree however, both their briefs Joan’s do disposition pension. They agree, and at oral that court did not divide the argument, community in Joan’s it retained to do so when Joan be- pension; jurisdiction simply comes to obtain benefits under the If the eligible parties’ description plan.10 (or of the trial court’s disposition nondisposition) property accurate, interest in Joan’s that the trial we would pension plan agree court abused its discretion. (a),
Pursuant to Civil in a dissolution Code section subdivision action “the court shall ... its of dissolution of the judgment marriage time ... or at a later if to make such a it reserves expressly jurisdiction division, divide the property property quasi-community property this direction parties equally.” By Legislature requires of the dis- be divided at the time of litigation action, solution to bifur- has the trial court’s although recognized power *13 case, cate and one or of marital try more issues in the termination including status, issues, for a time to other reserving jurisdiction try including later and the division of Neither the support any remaining community property. one, nor but legislative history any analysis provides section case indefi- for the that a court reserve authority may jurisdiction proposition uncommon, to divide and is often of nitely a asset. It is not community issues, of other for the assistance in a settlement parties reaching court to or after the termination bifurcate and one or more issues before try with a Quite of the marital often there are cases pivotal status parties. which, decided, to settle all other issue once it is will enable the parties value, as separate issues. This be an issue of the character property asset, or community a or is to be awarded community, specific party jurisdiction to open-ended reservation of 10A distinction should be drawn between an future, divides those community presently in the and one which pension divide interests in a benefits are jurisdiction supervise payment their when interests and reserves or retains former, authority but has no to do the received in the future. As we shall discuss court authority have the latter. does do cases the court is exists. In such whether an asset such as even goodwill in the hope issue and decide encouraged try pivotal separately The resolution issues. best will then be able to settle all other parties actions, case, reached by agreement dissolution is one especially themselves. parties in which the manner
The trial court
broad discretion to consider
possesses
tried,
trial of pivotal
bifurcation and separate
issues should be
including
the lan-
However,
including
in Civil Code section
issues.
nothing
to make
time
jurisdiction
if it
reserves
“shall ...
a later
guage
expressly
.,”
division,
. .
authorizes
community
such a
divide the
property
in the
benefits
begins paying
the court to wait for
until
years
pension plan
therein.
future before
interest
dividing
community
of commu
to the disposition
research of California law with
Any
regard
vested,
with In
begin
should
interests in
whether or
nity
pension plans,
Brown,
new rule that
In
We disagree with this in Carl “Pension strongly because ruling rights, vested, interest; whether not or a to the extent such represent property rights coverture, derive from employment asset during they comprise Brown, to subject (In division in a dissolution re Marriage proceeding.” Brown, supra, 842.) Thus, Cal.3d to is pursuant something there divide, for the trial is, court to the interest of the community property in the nonvested, It is parties whether vested or pension. right, property not an In with expectancy. the intent of the keeping Legislature providing for the division of community assets the dissolution trial during litigation, Brown, i.e., courts have only the two alternatives stated in to cash out the nonemployee spouse at the present value interest in the pension and award it to the employee to divide the spouse, interest in the in kind. pension Additionally, we conceive no good reason law perpetuate family litigation when such interests indefinitely property can and should be divided all part litigation process dividing other community property parties.
After a thorough record, search of the we are find unable to evidence to the presented trial court of value of present pension Joan’s plan, it, or, amount of her indeed, contributions to even its existence. Apparently disposition community interest her was pension plan agreed during conference, in-chambers immediately prior the com- probably mencement of trial. we Although only surmise that is what has occurred here, it is appropriate remind the trial and bar that our bench review limited to the record before us. often informality which accom- Despite cases, panies litigation family law it is crucial that statements be on the placed record reached off-the-record memorializing stipulations counsel, conferences between or counsel and the court. the absence of
Despite in the record about the existence of Joan’s anything plan, parties nonetheless there is such a with the agree State Teachers’ Retirement had System. Joan testified she been a teacher A review of eight years. her to trial does prior declaration filed $10,700. however, list such a pension and values it at We that this suspect, the amount of represents her to the contributions plan, plan’s *15 value at the time of the of her declaration. filing
Nevertheless, the to the court no evidence was although presented contributions, the date at which Joan amount of the the terms of the plan, benefits, be for or facts any would of retirement eligible payment valued, had be the court still which her retirement benefits could presently in interest the ability plan the to make an in-kind division of the community the interest by community the time rule. “This method of dividing applying in the unnecessary compute present renders it court pension the risk that the rights, pension value and divides pension equally (In Brown, 848.) re 15 Cal.3d at supra, will fail to vest.” Marriage of Thus, nor other infor- testimony even is neither any there though expert exists, and for the a plan regardless mation fact that except pension vested, the community whether in the the court can divide the interest is plan to divide Thus the court had the discretion interest between the parties.11 of Elmer’s interest by interest in Joan’s cash out community pension division, open-ended or in-kind but it did not have retain an authority over interest. jurisdiction community the division However, in the interlocutory court’s order our review the trial that the reveals, on to the judgment contrary posture parties appeal, to divide the com court did not retain an jurisdiction simply open-ended each it divide it. As to party interest in the did indeed munity pension plan; disso interlocutory judgment the court made the award following lution; in the California State Teach “One-half of the interest community jurisdiction The court reserves ers’ Retirement Benefits in name. [Joan’s] date when be at earliest divide said benefits which shall distributed is to draw her eligible pension.” [Joan] interest
This division accomplishes language Indeed, as a claimant was joined Joan’s since the itself pension plan. modified to reflect action, if of the order is and the wording appeared unlikely supervision by it is the dates of marriage separation, court will ever be necessary.12 allo- this, more carefully it that the necessary wording
To is accomplish rule, is, a consid- the time cate interests separate 11Thus, no supra, when Hargrave, in a case like In re sugges court’s plan, in to that court the interest in the addition evidence before the as to can appoint expert, its own require that the trial court can additional evidence tions also divide the kind. King, California Prac plans Hogoboom and joinder 12For a see discussion on (TRG 1985) Family through 8:133. pages tice Guide Law 8:131 *16 eration of the ratio of the time Joan teacher was as a between employed dates of and of marriage and the total amount time she was so separation, employed. Again record is It that Joan was still incomplete. appears at the teaching date of em- but soon thereafter terminated that separation It is ployment. unknown whether Joan has or returned to will do teaching so in the future. circumstances,
Under these since we trial court’s exercise uphold discretion award the community interest Joan’s retirement to the plan kind, we parties modify the provisions interlocutory judgment to the community interest in Joan’s with retirement the California plan Teachers’ Retirement Said interest be System. shall that fraction the total benefits, the numerator of which represents the number months of Joan’s employment between the dates of marriage and the denom- separation, inator of which is the (See total number of months of Joan’s service. In re Judd, Marriage 523.) fraction, supra, at This multi- p. the benefit plied by under the is the paid plan,
in benefits under the and it is awarded one-half to each plan party. Any remaining benefit paid under the is plan confirmed to Joan as her separate property.13
In decision, making this we that the amount which will acknowledge Joan receive from her pension for plan upon retirement is achieving eligibility less certain than is true with Elmer’s known if will plan. It Joan return to or teaching what she salary may ultimately level achieve if she does By using above, so. the formula set forth makes no difference wheth- it or er not Joan returns to This formula still that teaching. determines portion of benefits which are community.
The decision how to award the interest in future pension plan is one within the payments trial court’s broad discretion and Elmer has made no showing any (See abuse that plan. discretion as Joan’s retirement Skaden, In re 688; Marriage 19 Cal.3d In re supra, p. Brown, circumstances, supra, 848.) 15 Cal.3d at all of the Considering it appears that the court’s jurisdiction reservation of was reasonable.
fact the trial court valued Elmer’s awarded it change 13This will not this make order Domestic Relations Order” under “Qualified However, Equity public private plan Retirement Act of than 1984. since this is a rather appear would If apply. parties act does not one of the believes this other reason purposes proper proportionate order should be modified further for payment they paid, of benefits when are so can be addressed to the trial motion do court. *17 (with Joan),
him to does not the offsetting require community assets in be Joan’s to treated plan identically.14 Assets Community
III. Date Valuation of of residence, assets, the family Elmer claims the community including value the date of should have been evaluated and divided their at using at the time valuing instead of at the time of trial. In the property separation trial, law. of the trial court with case and statutory conformed existing (a), court to value com-
Civil Code section subdivision directs the that the court munity except assets as near to the time of trial as practicable, cause, may, on the property notice and a value appropriate showing good at a date made such a request, after and before trial.15 Elmer separation The trial court which Joan on the of a lack of cause. good basis opposed the refused properly request. Hayden re Marriage In Elmer,
A 124 decision relied by upon 183], court’s decision 72 the Cal.App.3d actually supports Cal.Rptr. [177 a situation Hayden to value the as of the of trial. concerned time property at time of the original where the valuation dates were either possible at court. The by trial or the time a later trial a remand the appellate upon be Hayden court held “section 4800 must inter- that that equity required its as near as to be divided at value preted requiring property 683 14Elmer’s reliance on In re Shattuck Shattuck, 698], spouse’s misplaced. including the fact that one is The issues in matured, and, fact, to Shattuck court reaffirmed was were not identical those here in (Id.., dividing community property. broad to trial court’s discretion choose a method 687.) at p. (a), purposes pertinent part Code in 15Civil section subdivision states as community property assets and liabilities near as dividing “the court shall value the trial, that, moving party except days’ by to the practicable the time of notice may any portion of the assets and party, good court for cause value all other shown equal of the accomplish at a an division separation prior liabilities date after trial parties equitable man property quasi-community property and the ner.” generated has wording requirement of for an alternate valuation date The notice motion, timely from the just notice require some The section does not a noticed confusion. timely notice Joan’s counsel in party party. gave to the Elmer written requesting other court, referred to original proof with of service. notice fashion and filed the with the explained the sought and authority, valuation date code section as stated the alternate valuation date noticed motion for an alternate request. basis for the Elmer then filed a supporting and his decla- points and authorities supported an extensive memorandum requirements. statutory opposition. would have satisfied the ration. Joan filed Either notice statute, motion alone is the believe use of a noticed Although required we request of whether the it in advance of trial preferred practice since results in a determination experts expense of unnecessary discovery, minimizes the granted. helps This reduce cases, and, achieving many will settlement. reaching opinions their assist to the court practicable in which a division takes proceeding proper place. trial, While it will be normally at also be on remand after appeal.” (Id., 79; italics in The trial court’s decision to value the original.)16 as of the time of trial was correct.17
IV. Note to Equalize Division Community Property In order to the division of trial equalize property, *18 court ordered that Joan execute a note favor of for in Elmer promissory $56,809.71 payable years three after the date she of the acquires possession family Elmer, residence from its her to of upon by sale the end the prior three-year period. The note will bear interest of 10 percent compounded annually be secured a second deed of by trust on the residence. family Elmer claims the court its abused discretion the by awarding promissory to note an accomplish division rather than the equal ordering house sold. He fails to show abuse of discretion.
Promissory notes the division of equalize have property been invalidated where the notes were an for extended of time and period bore (In interest inadequate rates. re Marriage (1976) Tammen 63 of Cal.App.3d 927 in Cal.Rptr. years, 10 at an interest payable [134 161] [note of 7 rate percent In re uncompounded]; Marriage Hopkins (1977) 74 of 591, Cal.App.3d 597-598 an for extended Cal.Rptr. period [141 597] [note characterized court by about “just the rest life expectan- [the wife’s] at cy,” a 7 rate].) percent interest
Courts have discretion to use notes for promissory relatively short periods at reasonable interest In In (1979) rates. re Slater Marriage 100 Cal.App.3d 686], 241 [160 the court the order for a Cal.Rptr. approved note 10 five-year bearing interest percent compounded annually equalize the division of community The Slater court its property. distinguished facts from those case, however, of Tammen “In the instant the wife will stating, receive the interest, entire ($24,430), amount of the note promissory plus at the very latest five This a years. is not and uncertain deferment long Furthermore, wife’s enjoyment of the award. note bear the was to division, 16Elmer has also Brink v. holding by misconstrued the in a decision this recent not, Brink claims, Cal.App.3d 155 Brink did Cal.Rptr. 225 as Elmer [202 57]. hold that trial. Brink is also proper valuation was at date of original inapplicable case independent governed instant since it in equity by Family involved an action Law Act. 17Hayden is often cited as authority proposition upon for the remand for retrial com munity assets be purposes Although must valued as of the time of retrial division. interpretation may this be appropriate in the a all property event of retrial as to ¿1 there, parties, owned certainly even where a retrial involves less than community property, holding Hayden interpretation upon better is that a retrial the court should consider equitable determining factors in whether be should valued as of the original time of the trial or retrial.
762 at of 10 with the interest an- payable the rate annum per percent It interest in the was secured a of the husband’s one-half
nually. by pledge ” (Id., 248; In Ho- Marriage investments. at see also re p. partnership 874].) 373 Cal.App.3d rowitz Here, is secured annually, the note bears interest compounded percent full, and will be at family paid substantial in the residence equity latest, three Elmer of the residence years possession after relinquishes Joan. the entire amount be- Additionally, as suggested Hopkins, due note payment come sooner because of the in the provision requiring (In supra, full if Joan Hopkins, sells the house sooner. re 598.) that the term and The trial court found specifically note economic con- interest rate of the were reasonable in current light the award of ditions and the facts of Under these circumstances the case.18 and un- long note does not Elmer equalizing promissory impose *19 The certain of his of award. 10 percent deferment the enjoyment for the of and short effects period potential payment adequately compensate Slater, 248.) The (In inflation. re 100 supra, Cal.App.3d of An order in case is that it note is secured. additional virtue of the this fully not to until the family youngest does Joan sell the residence after compel child reaches majority. does the di
Elmer maintains the note not equalize also that promissory assets, consider of since trial court the vision the the failed on the prom tax Elmer incur of upon receipt payments which liability might due to Elmer’s of dire tax are unfounded issory note. fears consequences Reform Act of 1984. New the enactment of the Domestic Relations Tax Code, 1041, of recognition eliminates section added 26 United States losses, of between spouses for tax on transfers gains purposes, result, more one takes than spouse made incident to dissolution. As a where of the other with spouse half of the community compensation property, note, The former or a not a taxable event. separate property promissory 959, (9th affirmed set Commr. 64 T.C. rule forth Carrieres v. 1350, taxable event is 1977) changed. Cir. 552 F.2d which made this a be to dissolution and would transfer in as incident the case qualifies 1041(c)(2); Cong. Code & (26 see also 1984 U.S. exempted. U.S.C. § News, I, E503-E504.) A-7, Admin. pt. pp. notwithstanding provisions the point Legislature specified 18We out that the has 4800, community property, (a), division requiring equal Code
Civil section subdivision warrant, party one on award the court asset “Where economic circumstances property.” substantially equal division proper such as it deems to effect conditions Code, (Civ. (b)(1).) subd. § Attorney V. Fees
Elmer contends was an of discretion for the trial court abuse $15,000 award Joan fees because this rewarded Joan attorney effectively what Elmer fraud on court sees the successful perpetration obtaining order aside the setting previous interlocutory judgment.
It is family well settled that the award fees and costs in attorney law matters is within the broad discretion of the trial court and that court’s decision in a particular case will not be disturbed on absent a clear appeal (In of abuse showing of discretion. re Behrens Marriage of 200]; therein.) and cases cited Elmer has failed to make such a showing.
The trial court made the of its following finding award support of attorney fees: “The parties’ dissolution were proceedings prolonged faith, complicated tactics and actions based on good [Elmer’s] were frivolous and caused toDue unnecessary delay. personal [Elmer’s] conduct during these the nature its proceedings, litigation, complex contest, involved, ity, nature and extent amount the financial circumstances the parties, the skill required, professional standing skill reputation amount of and effort respective parties, wisely devoted to the case, expeditious the costs incurred and disposition circumstances, parties’ financial it is necessary for reasonably [Elmer] *20 to to $15,000.00 amounts, pay the sum of in addition to earlier [Joan] for the cost of the and for fees maintaining proceedings attorney’s through time noted, of trial.” The court also fees attorney the “award was on based the trial, evidence admitted the took judicial court also during notice of its own court files and the fact that nullifying prevailed [Joan] property agreement. The court did not the full award amount [Joan] attorney [Elmer], fees requested clearly, but for conduct of such a contest to nullify the not if agreement would have been warranted the agree ment had been fair and equitable.”
Thus, here, it can be seen that the award of fees attorney imposed part Elmer, because the conduct of was on Code section not based Civil solely 4370, which authorizes award of fees on the basis of need and attorney to ability pay.
“While the wife as a of the husband’s attorney’s fees the incurs result dilatory tactics consideration the amount determining appropriate (see (1950) an award 842 Warner v. Warner 34 Cal.2d P.2d [215 20]), it is not sufficient to their in the first instance. Such an award justify to award must be based on of the parties pay. abilities solely respective (2 Family Attorney’s Cal. Law: Practice and Procedure Markey, (In Stephenson re Marriage Costs, Fees 25.12[l][a], 25-29.)” pp. § words, 383].) In other Act, Law Stephenson held that fees under attorney Family awards be the need of the absent other must made based statutory authority, and the to recipient ability pay. payor’s
However, from Prior Stephenson. the instant is to be case distinguished here, sec- trial had Code of Civil Procedure Legislature adopted enactment, 128.5, (a). tion subdivision Pursuant trial courts statutory this now one fees or other authority attorney have to order party pay reasonable other are incurred because tactics which expenses party unnecessary on which frivolous or cause actions not based faith are good delay.19 the trial
There is considerable evidence the record supports fees, court’s The trial court’s award of findings. attorney expressly express Civil section based on both Civil 4370 and Code of Procedure Code section 128.5, be on (a), ap- disturbed subdivision was and should appropriate There was no of discretion.20 peal. abuse The Family Residence*
VI. Disposition VIII. in Joan’s (1) community is modified to that: judgment provide is awarded
retirement with the Teachers’ Retirement System California 128.5, (a) “Every trial court shall 19Code Procedure states: of Civil section subdivision *21 both, attorney, pay any to reasonable power party party’s have the to order a or the or fees, or expenses, attorney’s by party as a result of tactics actions including incurred another delay. unnecessary Frivolous good faith which frivolous or which cause based on are to, include, making opposing motions delaying actions tactics but are not limited or good without faith.” judges given trial Legislature 20In Civil has adopting Code of Procedure section 128.5 cases, family faith. law good which not in In litigants a valuable tool to curb actions of are judicious surrounding marriage, of the use breakup because atmosphere of the emotional stifled, bad faith and not be but Aggressive advocacy should be made of this tool. should least, tool, very places the at the repetitive of conduct not be tolerated. This courses should being financially whole of made good position victim of not carried faith conduct on instances, find innumerable opposing We have the entire record before us and it. reviewed fully justify the trial court’s opinion, of been in this some which have referred to 128.5, section attorney pursuant of Civil Procedure imposition of fees Elmer to Code (a). subdivision ante, footnote, page *See 742. retirement be that fraction determined to to each and is party
one-half Joan’s service months of the number of numerator of which is benefits the separation and the date date of marriage August between the of months the number of which is 19, 1980, denominator and the of April of each benefit payment, the amount her total service multiplied as her separate to Joan is confirmed benefit any remaining payment property. denying orders modified, The subsequent is affirmed. judgment
As so to him and requiring modify interlocutory judgment Elmer’s motion affirmed. residence are and vacate the family to Joan relinquish possession extent fees to the attorney including Joan shall recover her costs on appeal, law. authorized J.,
Low, P. concurred. that trial courts result, on view HANING, my I concurin the based J. Law Act has Family cases. The should have broad discretion in dissolution in the area as it was intended to solve many created as problems added to the problem courts have distribution. Unfortunately, appellate to the mightily contributed and created further confusion. We have also have and other appraisers witness Actuaries industry. growth expert drive the cost has, course, served to up had it so This only never good. since at the time divorce, a which is a obtaining regrettable consequence, rather than dissi need family disintegrating preserve, parties their assets. pate, case, actuaries, in the instant who testified as experts
When such as those necessarily they of a plan, on the value pension render their opinions present know As we economic conditions. make certain as to future assumptions is less than forecasting historical economic examples, from various painful even less exact. are of future human behavior an exact science. Predictions be 10 or rate will Thus, what the interest when we as to testimony accept from the (to road, phrase borrow down the we are engaging 20 years individ- whether an President) guess “voodoo economics.” Trying Vice ever collect enough long will remain with a employer ual particular when best, tomfoolery and sheer is hazardous nickel by way such guesswork. based upon cash sums awarding large we start *22 unvested, cer- or where short, where the In in those situations any- collect can before the employee to be fulfilled tain conditions remain until of that asset the division I the better is to defer think thing, practice know what we have. such time as we and appellant’s June was denied rehearing
A for a petition 14, 1985. August was denied Court Supreme for review petition *23 Exhibit
PRESENT VALUATION OR RESERVATION OF
EMPLOYEE-SPOUSE *24 CONSIDERATIONS PRACTICAL JURISDICTION: NON-EMPLOYEE SPOUSE