In re the Marriage of BYRON GEORGIOU and MARIA LESLIE. BYRON GEORGIOU, Respondent, v. MARIA LESLIE, Appellant.
No. D061200
Fourth Dist., Div. One.
July 31, 2013
218 Cal. App. 4th 561
Law Offices of Marjorie G. Fuller, Marjorie G. Fuller, Lisa R. McCall; Law Offices of Fuller Jenkins and Erik C. Jenkins for Appellant.
Law Office of Stephen E. Temko, Stephen E. Temko; Ashworth, Blanchet, Christenson & Kalemkiarian, Sharon L. Kalemkiarian; English & Gloven and Mark M. Gloven for Respondent.
OPINION
McCONNELL, P. J.—More than three years after entry of judgment, Maria Leslie filed an action under
We conclude
FACTUAL AND PROCEDURAL BACKGROUND
Leslie and Georgiou married in 1985 and separated in 2003. Georgiou filed for dissolution that year, and a bifurcated judgment terminated the marital status in 2005.
Georgiou is an attorney, and in 2000 he entered into an “of counsel” relationship with Milberg Weiss Bershad Hynes & Lerach LLP (Milberg Weiss)2 that entitled him to a referral fee of 10 percent in class action litigation in which Georgiou secured the plaintiff and the firm was designated lead counsel.
In 2002 Milberg Weiss entered into a contingency fee agreement with The Regents of the University of California (the Regents), which was ultimately designated the lead plaintiff in federal class action securities litigation against Enron. On a sliding scale, the agreement authorized attorney fees of between 8 and 10 percent of the recovery.
In February 2007 Leslie and Georgiou entered into an MSA. Before signing it, Leslie knew of Georgiou‘s referral fee agreement with Milberg Weiss, that the firm had thus far recovered approximately $7.2 billion in settlement funds, the largest recovery to date in a class action, and the firm would be submitting a request for attorney fees in federal district court under its fee agreement with the Regents. It is undisputed that Georgiou did not give Leslie a copy of the fee agreement.
Leslie deposed Darren J. Robbins, a Milberg Weiss partner designated most knowledgeable about Georgiou‘s relationship with the firm. Her attorney questioned Robbins on whether the firm had a fee agreement with the Regents, but he did not ask Robbins what percentage of fees the Regents had agreed to pay the firm, nor did he ask for a copy of the agreement. In any event, Robbins testified the federal district court must approve a fee award based on a variety of factors, and it is not bound by a fee agreement.
Robbins also testified Georgiou was entitled to a referral fee from Milberg Weiss in the Enron litigation, but there was a dispute as to the amount of the fee. Robbins said, “I would not imagine any scenario under which [Georgiou] would receive less than three percent.” Robbins also said the firm hoped to obtain attorney fees substantially exceeding the largest securities class action fee award to date of $330 million, as that award was based on a much smaller
In a settlement conference brief, Leslie gleaned that Georgiou‘s referral fee may be between $9 and $33 million, presumably based on a potential fee award to Milberg Weiss of $330 million. She acknowledged, however, that the firm intended to seek “far more than $330 million,” and that Georgiou intended to “vigorously argue” he was entitled to a full 10 percent referral fee.
The MSA divided the prospective referral fee unequally. Leslie agreed to accept 10 percent of the fee, in exchange for approximately $7 million in other assets and debt relief. She received the family home, even though it was Georgiou‘s separate property, eight townhomes that produced net monthly income, a Roth IRA and retirement accounts. He received 90 percent of his referral fee, life insurance policies, loan receivables, business interests, and substantial credit card and other debt. According to Georgiou, Leslie “was taking everything that was certain.”
The MSA was incorporated in a judgment of dissolution entered on December 12, 2007. About a month later, Milberg Weiss submitted its fee application to the federal district court in the Enron case, requesting 9.52 percent of the ultimate recovery of approximately $7.2 billion, pursuant to the terms of its fee agreement with the Regents. In September 2008 the federal district court issued a lengthy order granting the request as reasonable and awarding Milberg Weiss $688 million in fees.
Milberg Weiss then negotiated a 9 percent referral fee with Georgiou. In September 2008 Georgiou paid Leslie $4 million for her 10 percent share of the fee, which caused her to realize his fee exceeded the top range of $33 million she anticipated when she entered into the MSA. In November 2009 she learned she was entitled to an additional $1.56 million.3
Leslie retained a new attorney, and in November 2009 she filed a motion under
On December 13, 2010, however, Leslie filed this action under
Georgiou moved for summary adjudication, arguing her action was untimely because she did not file it within three years from the date she had “actual knowledge that the transaction or event for which the remedy is being sought occurred.” (
The court determined, sua sponte, that relief for breach of fiduciary duty under
The court also found that
DISCUSSION
I
Standard of Review
Leslie contends the court erred by granting summary adjudication. She asserts the court misinterpreted
A defendant meets his or her burden in a summary adjudication motion “by negating an essential element of the plaintiff‘s case, or by establishing a complete defense, or by demonstrating the absence of evidence to support the plaintiff‘s case.” (Rubenstein v. Rubenstein (2000) 81 Cal.App.4th 1131, 1142; see
II
Applicable Law/Analysis
A
Fiduciary Duties During Dissolution Proceedings
Spouses have fiduciary duties to each other as to the management and control of community property. (
The fiduciary duties expressly extend throughout dissolution proceedings. (
Further, “each party has a continuing duty to immediately, fully, and accurately update and augment that disclosure to the extent there have been
B
Postjudgment Remedies for Breach of Fiduciary Duty
1
There are, of course, postjudgment remedies for breach of the fiduciary duty of full disclosure during dissolution proceedings. Within the first six months after entry of judgment, the court has discretion to set aside a judgment under
Further, “[i]n 1993, a chapter entitled Relief From Judgment was added to the
”
Under
Leslie, however, waited too long to pursue relief under
2
With the applicable
The family court determined
Leslie also cites In re Marriage of Rossi (2001) 90 Cal.App.4th 34 (Rossi), as authority for the applicability of
Relying on Rossi, Hogoboom indicates
In Rossi, supra, 90 Cal.App.4th 34, however, there was no contention that
Moreover, the facts of Rossi are readily distinguishable from those here. In Rossi, the lottery winnings were concealed and not addressed in the judgment of dissolution. Thus, the winnings could be divided in a postjudgment action under
Here, Georgiou not only disclosed his prospective referral fee in the Enron litigation, it was a major factor during negotiations on the MSA and the subject of discovery by Leslie‘s attorneys. The judgment fully adjudicated the issue, with the MSA awarding Leslie 10 percent of the fee and Georgiou 90 percent of the fee and dividing the remainder of the community assets and debts to reflect the disparity.
” ‘A court must, where reasonably possible, harmonize statutes, reconcile seeming inconsistencies in them, and construe them to give force and effect to all of their provisions. [Citations.] This rule applies although one of the statutes involved deals generally with a subject and another relates specifically to particular aspects of the subject.’ ” (Pacific Palisades Bowl Mobile Estates, LLC v. City of Los Angeles (2012) 55 Cal.4th 783, 805.) ” ’ “The courts are bound, if possible, to maintain the integrity of both statutes if the two may stand together.” ’ ” (In re Greg F. (2012) 55 Cal.4th 393, 407.) “We . . . construe the words in context, keeping in mind the statutory purpose... relating to the same subject, both internally and with each other, to the extent possible.” (Outfitter Properties, LLC v. Wildlife Conservation Bd. (2012) 207 Cal.App.4th 237, 244.)
We are not required to determine the propriety of the court‘s finding that
The court correctly found Leslie‘s exclusive remedy was a set-aside action under
The order is affirmed. Georgiou is entitled to costs on appeal.
Benke, J., and O‘Rourke, J., concurred.
Appellant‘s petition for review by the Supreme Court was denied October 16, S213134.
