Marriage of Carter, In re

• Decision Date: 23 August 1971
• Citation: 19 Cal.App.3d 479,97 Cal.Rptr. 274
• Court: California Court of Appeals Court of Appeals
• Parties: In re the marriage of Paula CARTER, Appellant, and Jack CARTER, Respondent. Civ. 37203.

Page 274

97 Cal.Rptr. 274

19 Cal.App.3d 479

In re the marriage of Paula CARTER, Appellant,

and

Jack CARTER, Respondent.

Civ. 37203.

Court of Appeal, Second District, Division 4, California.

Aug. 23, 1971.

Fierstein Dolin & Rothman, and Harvey Fierstein, Los Angeles, for appellant.

Crowley & Goffin, and Arthur J. Crowley, Hollywood, for respondent.

KINGSLEY, Associate Justice.

In January 1969, Mrs. Carter filed a complaint for divorce to terminate the seven-year marriage of the parties. The matter came to trial in January 1970, after the effective date of the new Family Law Act. At trial the parties entered into a stipulation providing for the division of community property. The court took evidence on the remaining issues of support, costs and fees and (on January 29, 1970) ordered that the community property be distributed in accordance with the oral stipulation.

On February 18, 1970, present counsel for the wife was substituted in the place and stead of her trial counsel and, on February 20, 1970, a Request for Findings of Fact and Conclusions of Law was filed. The request specifically asked the court to make findings which would list each and every community asset, with their market value and any liens and encumbrances. On its own motion the court denied the request on the ground that it was filed after the ten-day period provided for by Rule 232(b), Rules of Court.

On February 26, 1970, prior to entry of the Interlocutory Decree of Divorce, Mrs. Carter filed a Notice of Motion for the following orders:

1. That the oral stipulation re division of community property be deemed non-enforceable;

2. That the oral stipulation re division of community property be set aside;

3. That relief from default be granted to appellant in her Request for Findings of Fact;

4. That Findings of Fact be ordered prepared for the approval of the court;

5. That the court continue the matter for further proceedings re determination and distribution of community property.

In support of the motion, declarations by the wife and her present attorney, Harvey Fierstein, were filed. Declarations of Arthur J. Crowley and Cy Donner (accountant for the husband) were filed in opposition. On March 25, 1970, the matter was augued before the court and all motions were denied. Thereafter, a motion for a new trial was made, with an additional supporting declaration of Mrs. Carter. Said motion was also denied.

At the proceedings before and during trial, the wife was represented by Mr. Guy Ward of the law firm of Ward, Heyler and Druten. Mr. Ward has been admitted to practice in California for approximately 27 years and, for approximately 10 years prior thereto in another state. He is past president of the Beverly Hills Bar Association and has served on the Board of Trustees of the Los Angeles County Bar Association. It was stipulated at the hearing on the motions that Mr. Ward is an 'eminent member of the Bar.' Mrs. Carter also had the services of Mr. Don Gursey, a certified public accountant. Part of these services included the tracing and movement of assets from March 1, 1961, through 1969. He reconstructed assets and made a tentative division as to community and separate property, and a preliminary net worth statement was prepared. Subsequently Mr. Gursey received not worth statements of Mr. Carter for the period of the marriage. Mr. Ward also reviewed a financial statement prepared by Cy Donner (husband's accountant) showing the assets of Mr. Carter.

At the deposition of Mr. Donner, requests were made for appraisals on four entities known as limited partnership interests. Although Mr. Ward subsequently received some information as to these interests, he did not receive actual appraisals.

Mr. Gursey's audit of the books and records of Jack and Paula Carter was admitted into evidence and known as the 'Gursey Statement.' It indicated the following facts:

(a) That the values for various listed community assets were the 'book value';

(b) That the cash balances in the savings accounts do not reflect credit for interest earned;

(c) That the stocks and bonds are carried at cost as of the date of acquisition and do not reflect current market value;

(d) That the wholly owned personal service corporations have made investments which are carried on the books at the net book values.

The 'Gursey Statement' shows a community estate of $505,013 while the statement of Mr. Donner shows a community estate of $264,082.

In urging reversal, the wife contends that the trial court is required to ascertain the nature, extent and value of all community assets and their fair market value notwithstanding a stipulation between the parties as to distribution of community property; that the trial court abused its discretion in denying the wife relief from said stipulation; and that the trial court abused its discretion in denying appellant relief from default upon her failure to file a timely request for findings of fact.

I

The statutory rule on distribution of community property is contained in Civil Code section 4800. At the time of trial that section provided:

'The court shall * * * divide the community property and quasi-community property of the parties equally.'

Rule 1242, Rules of the Superior Court further required that:

'The court in every case shall ascertain the nature and extent of all assets and obligations subject to disposition by the court in the proceeding and shall divide such assets and obligations as provided in the Family Law Act, Except upon the written agreement of the parties or an oral stipulation of the parties made in open court.' (Italics added.)

The wife argues that the exception in Rule 1242 (oral stipulation) does not exonerate the trial court of its imposed duty to ascertain the nature and extent of all obligations subject to disposition. She reaches this conclusion by referring to rules of statutory construction to the effect that a qualifying phrase is to be applied to the immediately preceding words or phrase. (See People v. Baker (1968) 69 Cal.2d 44, 69 Cal.Rptr. 595, 442 P.2d 675; Hopkins v. Anderson (1933) 218 Cal. 62, 65, 21 P.2d 560.) She thus admits that, once the parties have entered an oral stipulation, the court is relieved from making a division of the community property. Assuming, arguendo, that the court is not relieved of its duty to ascertain the nature and extent of community property, this burden is lessened by virtue of an oral stipulation. Evidence on issues in a case may be limited in accordance with a stipulation by respective parties. (Morrow v. Morrow (1940) 40 Cal.App.2d 474, 485, 105 P.2d 129.) Indeed, the very purpose of such a stipulation in resolving issues for trial would be obliterated if the court were required to make a detailed investigation on each asset. in approving the stipulation of the parties the court is only bound to ascertain the nature and extent of community property to the degree necessary in order to exercise its discretion. In the present case the court did not merely approve the stipulation without question. The following colloquy occurred between counsel and the court:

'MR. CROWLEY: Your Honor, after much conversation with opposing counsel and our respective clients, we have arrived at a stipulation concerning the wife's share of the community property, which I will recite. Mr. Ward will feel free to correct me on any point.

'I think the record should show first of all that both parties are here in court; and that there have been extensive negotiations carried on between both counsel; that we have made available to them all the accounting records.

'Opposing counsel has had the benefit of his own accountant to advise him and his client; and that we spent most of yesterday negotiating and since 8:30 this morning. It is now approximately ten minutes after eleven, and we have just arrived at the stipulation; so it is not anything that was arrived at hastily.

'THE COURT: All right.

'MR. CROWLEY: The wife shall receive as community property in full settlement of any and all claims she has to community property the sum of $150,000, payable as follows:--

'THE COURT: This is a cash sum you are talking about?

'MR. CROWLEY: It is a cash amount, but not payable in cash.

'THE COURT: A cash amount, but not payable by cash provision?

'MR. CROWLEY: She will receive the equity in the family home located at 603 Foothill Road, Beverly Hills, California, at a suggested sum of $45,000.

'THE COURT: All right.

'MR. CROWLEY: She will also receive the furnishings in that home, less certain specific items that are in dispute, which counsel and I know about, and which we are going to try to resolve later, at an agreed sum of $15,000.

'The wife shall receive the car now in her possession. I believe it is a Lincoln.

'MR. WARD: Yes.

'MR. CROWLEY: At the agreed sum of $5800.

'The wife will receive by way of retention of the $15,000 in cash now in her possession--that is, the wife already has that, and that will be a credit, as these other items are a credit against the $150,000.

'Those sums total $75,000. Deducting that $75,800 from the $150,000 total, leaves us $74,200. That sum of $74,200 shall be payable as follows:

'One-third thereof, or $24,733, payable upon entry of the judgment, the interlocutory;

'An additional sum of $24,733 to be paid one year from the date of the entry of the interlocutory;

'And the remaining balance of $24,733 to be payable two years from the date of the entry of the interlocutory judgment.

'THE COURT: All right.

'MR. CROWLEY: This balance is to be payable without interest and without security.

'THE COURT: It is understood, this is all a division of community property?

'MR. CROWLEY: That's right. in other words, it is tax free to the wife.

'THE COURT: Tax free to Mrs. Carter?

'MR. CROWLEY: That's correct.

'THE COURT: Without interest and without security?

'MR. CROWLEY: That's correct.

'THE COURT: All right.

'MR. CROWLEY: The...