Marriage of Huxley, In re

• Decision Date: 13 September 1984
• Citation: 159 Cal.App.3d 1253,206 Cal.Rptr. 291
• Court: California Court of Appeals Court of Appeals
• Parties: In re the MARRIAGE OF Karin Berta and John Patrick HUXLEY. Karin Berta HUXLEY, Petitioner and Respondent, v. John Patrick HUXLEY, Respondent and Appellant. Civ. 65343.

Page 291

206 Cal.Rptr. 291

159 Cal.App.3d 1253

In re the MARRIAGE OF Karin Berta and John Patrick HUXLEY. Karin Berta HUXLEY, Petitioner and Respondent, v. John Patrick HUXLEY, Respondent and Appellant.

Civ. 65343.

Court of Appeal, Second District, Division 2, California.

Sept. 13, 1984.

Hearing Denied Dec. 12, 1984.

Stephanie Nordlinger, Marina Del Rey, for respondent and appellant.

James E. Sutherland, Long Beach, for petitioner and respondent.

BEACH, Associate Justice.

Consolidated appeals by the husband in a dissolution-of-marriage proceeding. One appeal is from the interlocutory judgment dividing the property and ordering the husband to contribute $12,500 towards his wife's attorney's fees. We affirm that judgment in part, and reverse it in part. The other appeal involves a subsequent order of the trial court directing the husband to contribute $7,500 towards his wife's attorney's fees and costs on appeal. That order is affirmed.

FACTS:

Karin Hansen and John (Jack) Huxley started living together in Los Angeles in June 1969. Jack transferred to Karin stocks worth several thousand dollars to hide from his wife, who had sued him for divorce in Kansas in 1968. Jack told Karin his wife did not know he had the stocks and he did not want to share the stocks with her.

After his divorce had become final, Jack married Karin in September 1970. After the marriage, Karin transferred some of the stock back to Jack at his request. The couple separated in January 1978.

During their marriage, Karin and Jack bought the following real properties:

1. A condominium in Palos Verdes Estates, which they used as their residence;

2. A four-unit apartment building in Redondo Beach; and

3. A one-bedroom condominium in Austria. To buy the Austrian property, Jack had to establish residency in Austria, as required under Austrian law. Karin, a German national, did not want to establish residence there because she was afraid it would jeopardize her "green card" immigration status. Karin testified that because of certain complexities in Austrian land law she and Jack encountered, title to the property was still held in the previous owner's name after the purchase. Jack, however, testified title was in his name.

Title to the two American properties was taken in joint tenancy. Joint credit was used for both loans.

The down payments on all three properties came from Jack's separate property. Karin testified she and Jack treated the properties as community property. She did quite a bit of work on the properties, such as plastering and painting, sometimes up to 12 hours a day. Jack testified he had an agreement with Karin that the properties were his.

The trial court found the properties to be community property, and awarded the Austrian condominium and the Palos Verdes condominium to Jack, and the Redondo Beach apartment building to Karin. With respect to the Austrian condominium, the trial court made these findings: "The Court finds that the Respondent made a gift to the petitioner and the community of stock and funds which were used as a downpayment on the Austrian Condominium. The Court finds that when the funds were physically returned from Petitioner to the Respondent, that there was no intent on her part to make a gift and that Petitioner expected these stocks and funds to be used to purchase a condominium which was to be community property of the parties." As to the American properties, the court found that although Jack had not communicated any intent to make a gift to the community of the down payments, which came from his separate property, he had not proven the existence of an oral agreement between him and Karin that he was to maintain his separate property interests in those two real properties.

CONTENTIONS ON APPEAL:

Jack contends:

1. Under Civil Code section 4802, which went into effect on January 1, 1984, he is entitled to reimbursement of separate property funds used for the acquisition, during the marriage, of the Palos Verdes condominium and the Redondo Beach apartment building.

2. The trial court made an unequal division of the community property.

3. A clerical error was made in the valuation of his pension plans. In his reply brief, Jack abandons this issue. We therefore do not consider this issue.

4. There is insufficient evidence to support the trial court's finding that the Austrian condominium was community property.

5. The trial court erred in not admitting into evidence a German document, alleged to be a land sales contract for the Austrian property.

6. The trial court abused its discretion in ordering him to contribute $12,500 towards Karin's attorney's fees for the trial and $7,500 towards Karin's attorney's fees on appeal.

DISCUSSION:

1. Reimbursement of Jack's Separate Property Contributions to the Palos Verdes Condominium and the Redondo Beach Property

Out of his separate property, Jack paid $10,305 down on the Palos Verdes condominium and $12,600 down on the Redondo Beach apartment building. Title to both properties was taken in joint tenancy. Jack contends the trial court erred in not ordering reimbursement of his separate property contributions to the two properties.

At the time of the trial in this case, Civil Code section 5110 provided that "all real property situated in this state ... acquired during the marriage by a married person while domiciled in this state ... is community property." The section also provided that a single family residence acquired during a marriage in joint tenancy was presumed to be community property. The latter provision was deleted from section 5110, and is now replaced by two new sections, as discussed below.

In July 1983, Assembly Bill No. 26 was enacted, adding sections 4800.1 and 4800.2 to the Civil Code, and amending section 5110. (Stats.1983, ch. 342, §§ 1-2.) The new law became effective on January 1, 1984. Section 4800.1 provides that all property acquired by the parties during marriage in joint tenancy is presumed to be community property. This presumption affects the burden of proof and may be rebutted by either a written agreement or other documentary evidence that the acquired property is in fact separate property. This abrogates the rule of In re Marriage of Lucas (1980) 27 Cal.3d 808, 813, 166 Cal.Rptr. 853, 614 P.2d 285, which was in effect at the time of the trial in this case and which declared that the presumption arising from the form of title can be rebutted by evidence of an agreement or understanding, either written or oral, that the property is the separate property of one of the spouses despite the contrary indication in the deed. As noted earlier, Jack claimed the existence of such an oral agreement but the trial court ruled against him.

Civil Code section 4800.2 provides: "In the division of community property under this part unless a party has made a written waiver of the right to reimbursement or signed a writing that has the effect of a waiver, the party shall be reimbursed for his or her contributions to the acquisition of the property to the extent the party traces the contributions to a separate property source. The amount reimbursed shall be without interest or adjustment for change in monetary values and shall not exceed the net value of the property at the time of the division. As used in this section, 'contributions to the acquisition of the property' include downpayments, payments for improvements, and payments that reduce the principal of a loan used to finance the purchase or improvement of the property but do not include payments of interest on the loan or payments made for maintenance, insurance, or taxation of the property." (Emphasis added.)

The question is whether section 4800.2, which became effective on January 1, 1984, after the trial in this case, applies here. We conclude it does. Section 4 of Assembly Bill No. 26, which added sections 4800.1 and 4800.2 to the Civil Code, says that the new law applies to:

"(a) Proceedings commenced on or after January 1, 1984.

"(b) Proceedings commenced before January 1, 1984, to the extent proceedings as to the division of the property are not yet final on January 1, 1984." (Stats.1983, ch. 342, § 4.)

This case was not final on January 1, 1984, and therefore the new law applies to it. (In re Marriage of Koppelman (1984) 159 Cal.App.3d 627, 205 Cal.Rptr. 629; In re Marriage of Martinez (1984) 156 Cal.App.3d 20, 29, 202 Cal.Rptr. 646; In re Marriage of Anderson (1984) 154 Cal.App.3d 572, 577, 201 Cal.Rptr. 498; In re Marriage of Neal (1984) 153 Cal.App.3d 117, 121, 200 Cal.Rptr. 341.) ¹

We conclude that under Civil Code section 4800.2 Jack is entitled to reimbursement for his separate property contributions to the Palos Verdes condominium and the Redondo Beach apartment building which he and Karin acquired as joint tenants during their marriage. Any reimbursement, however, is limited to the separate property equity in the properties at the time of acquisition, and cannot include any appreciation of the property. (In re Marriage of Martinez, supra, 156 Cal.App.3d 20, 31, 202 Cal.Rptr. 646; In re Marriage of Neal, supra, 153 Cal.App.3d 117, 124, 200 Cal.Rptr. 341.)

In the reply brief, counsel for Jack argues that Civil Code section 4802 is unconstitutional because it limits reimbursement to the separate property funds originally invested in the community property, without any consideration of inflation or appreciation. Counsel points out that because of time limitations and "other commitments," she has had no time to make a proper argument. At oral argument, Jack's counsel again brought up the alleged unconstitutionality of the new law. Because this issue has not been adequately briefed, it is not properly before us and we therefore do not reach it. Instead, we follow the holdings of In re Marriage of Martinez, supra, 156 Cal.App.3d 20, 31, 202 Cal.Rptr. 646 and In re Marriage of Neal, supra, 153 Cal.App.3d at p. 124, 200 Cal.Rptr. 341, that reimbursement...