Hicks v. Hicks

• Decision Date: 19 December 1962
• Citation: 211 Cal.App.2d 144,27 Cal.Rptr. 307
• Court: California Court of Appeals Court of Appeals
• Parties: Milton A. HICKS, Plaintiff, Cross-Defendant and Respondent, v. Margaret Louise HICKS, Defendant, Cross-Complainant and Appellant. Civ. 6809.

Page 307

27 Cal.Rptr. 307

211 Cal.App.2d 144

Milton A. HICKS, Plaintiff, Cross-Defendant and Respondent, v. Margaret Louise HICKS, Defendant, Cross-Complainant and Appellant.

Civ. 6809.

District Court of Appeal, Fourth District, California.

Dec. 19, 1962.

Walter A. Young, for defendant, cross-complainant and appellant.

Thompson & Colegate, Riverside, for plaintiff, cross-defendant and respondent.

COUGHLIN, Justice.

The issues on this appeal concern the decision of the trial court respecting the community or separate character of property owned by a husband and wife at the time of their divorce.

The plaintiff, who is the respondent herein, and the defendant, who is the appellant herein, were husband and wife; married on September 1, 1950; had a son and a daughter; separated on June 6, 1958; and respectively, by a complaint and cross-complaint, sought a divorce, which was granted to each of them. The decree granting such also awarded custody of the son to the plaintiff and of the daughter to the defendant; ordered payment to the defendant of $500 per month as alimony and $200 per month as support for the daughter; directed the plaintiff to pay for the defendant the sum of $10,000 as additional attorney's fees, and $2500 court costs, payable from the community property of the parties; determined and described the amount of their community property; divided the same; allowed the defendant to use the homestead which it found to be separate property, for a period of five years; and declared that all other property in the possession of either of them, respectively, was their separate property. The defendant appeals from all parts of the judgment except those granting a decree of divorce to herself and to the plaintiff and awarding custody of their minor children.

On appeal the defendant makes no contention concerning the orders relating to the payment of alimony, child support, attorney's fees and court costs, but directs her attack upon those provisions of the judgment respecting the property issues determined thereby, contending that they are the result of an erroneous application of the law. In some instances, however, she argues the sufficiency of the evidence to sustain the findings of fact upon which the provisions in question are based.

At this juncture it is proper to indicate that if there is any substantial evidence in the record to sustain a finding of fact which supports the judgment, whether it be direct or indirect, contradicted or uncontradicted, the fact in question must be accepted as true by the Appeliate Court (Estate of Arstein, 56 Cal.2d 239, 240, 14 Cal.Rptr. 809, 364 P.2d 33; Primm v. Primm, 46 Cal.2d 690, 693, 299 P.2d 231); that all inferences reasonably deducible from the evidence which support the judgment will be accepted, while those which do not support it will be rejected (Hamilton v. Pacific Elec. Ry. Co., 12 Cal.2d 598, 602, 86 P.2d 829; Greco v. Oregon Mut. Fire Ins. Co. 191 Cal.App.2d 674, 681, 12 Cal.Rptr. 802); that 'Findings of fact must be liberally construed to support the judgment' (Johndrow v. Thomas, 31 Cal.2d 202, 207, 187 P.2d 681, 684); and that, in the absence of any indication to the contrary, the findings as made, by implication, include findings of all special facts necessary to sustain them. (Richter v. Walker, 36 Cal.2d 634, 640, 226 P.2d 593; Greco v. Oregon Mut. Fire Ins. Co., supra, 191 Cal.App.2d 674, 678, 12 Cal.Rptr. 802.) The recital of the facts herein and the scope of the findings in the premises, both express and implied, will be stated in accord with these rules.

At the time of marriage the plaintiff was the owner of (1) 98% of the common stock of Palm Springs Builder's Supply Company, a corporation, hereinafter referred to at the 'Supply Company', which had current assets in the sum of $268,652.32, subject to current expenses in the sum of $107,613.57, and fixed assets in excess of $300,000.00; (2) 25% of the capital stock of the Palm Springs Water Company; (3) certain real property, including that known as the Las Palmas Lots; and (4) a country club membership. The stock of the 'Supply Company' and the Water Company had been acquired by inheritance. The defendant contends that the plaintiff actually was the sole owner of the 'Supply Company' and that the corporation operating the same was his alter ego. It is not necessary to rule upon this contention as the conclusion advanced is of no legal consequence to a determination of the issues in this case.

At the time of divorce the plaintiff still owned the 'Supply Company' and a 25% interest in the Palm Springs Water Company, which the defendant concedes are his separate property.

During the marriage the plaintiff maintained a personal bank account, being the same account he had prior to marriage, into which he deposited and from which he withdrew both community and separate funds. At the time of divorce, the balance on deposit therein was $2500.

After marriage the plaintiff acquired, and at the time of divorce held legal title to, (1) a house situated on real property located in the Thunderbird Estates Tract, which is referred to as the 'Thunderbird residence,' and upon which the defendant placed a homestead following commencement of this action; (2) 184 shares of Financial Federation, Inc.; (3) four country club memberships; (4) accounts receivable in the total sum of $2,390; (5) an interest in an oil lease known as the 'Jacobs-Howsley Oil Lease Royalty,' which had been purchased for $6,250; (6) 357 shares of the stock of Indian Wells Country Club Estates, a corporation; and (7) household furniture and furnishings located in the 'Thunderbird residence'.

During marriage the plaintiff and defendant acquired and sold two community property lots in the Indian Wells Country Club Estates Tract, and a joint tenancy one-half interest in 5 other lots in the latter tract identified as the Prom lots. Also during marriage, i. e., in 1952, the plaintiff and defendant, as joint tenants, acquired title to Lot 19 in the Thunderbird Country Club Estates Tract from the 'Supply Company'; executed a $5000 promissory note in consideration therefor; and obtained a $20,000 bank loan thereon. Thereafter the property was improved. In 1955 it was sold. Part of the proceeds from this sale were paid to the loaning bank and the balance thereof purportedly was paid to the plaintiff and defendant. However, the evidence establishes that this balance was not deposited in the plaintiff's personal bank account. On the other hand, there is evidence from which it may be inferred that the whole transaction was handled by the 'Supply Company'; that no profit accrued therefrom; and that a net loss of $2499.02 was sustained.

In 1957 the Milt Hicks Investment Company, a corporation, was organized; was a subsidiary of the 'Supply Company'; issued its entire capital stock to the latter company in exchange for leases on real property which the 'Supply Company' had owned for many years; engaged in renting this property; and operated at a loss, which created a capital deficit in the sum of $6661.11. The defendant claims that the investment company was the alter ego of the plaintiff; that all of its assets belonged to him personally; and that these assets, being acquired during marriage, are community property. Whether the company in question is or is not the alter ego of the plaintiff, under the circumstances of this case, is not material to a decision respecting the right of the defendant to a share of its property. The assets foundational to the existence of the investment company were acquired by the 'Supply Company' from its own funds. If the latter company also, as contended by the defendant, is the alter ego of the plaintiff, the property in question is his separate property; any transmutation of that property into another form did not change its separate character; and the existing assets in whatever form they may be, are the plaintiff's separate property. The investment company was operated by a manager. There is no showing that the plaintiff's services during marriage in any way contributed to any increase in its assets. He received no salary therefrom. None of the transactions thereof were financed through his personal bank account. The defendant's contention that the investment company assets constituted community property is without merit.

At the time the complaint for divorce was filed the defendant had on deposit in her name, in bank and savings and loan accounts, the total sum of $14,782.39.

The court found that the Thunderbird residence was the separate property of the plaintiff; awarded the defendant the right to occupy the same for a period of not to exceed 5 years; and directed the plaintiff to satisfy all payments accruing thereon during such occupancy on account of taxes against, insurance premiums connected with, and promissory note installments secured by a deed of trust on said property.

The court also found that the Financial Foundation, Inc. stock, the four country club memberships, the accounts receivable, the oil lease royalties, and 132 shares of the Indian Wells Country Club Estates stock were community property, and awarded each of the parties a one-half interest therein after payment of attorney's fees and court costs as provided by the judgment. In addition, the court found that the $6250 used to purchase the oil lease royalties was the separate property of the plaintiff and directed that all subsequent earnings therefrom, to the extent of this amount with interest, should be paid to the plaintiff. The court also directed that the 182 shares of 'Indian Wells' stock was subject to the payment of the $7500 unpaid balance on a promissory note executed by the plaintiff to a bank from which he had borrowed $20,000.

The plaintiff was awarded the $2500 remaining in his personal bank account, and the defendant was awarded the $14,782.39 on deposit in her name.

The judgment further decreed that...