Marriage of Koppelman, In re

• Decision Date: 24 August 1984
• Citation: 205 Cal.Rptr. 629,159 Cal.App.3d 627
• Court: California Court of Appeals Court of Appeals
• Parties: In re the MARRIAGE OF Shirley M. and Robert A. KOPPELMAN. Shirley M. KOPPELMAN, Respondent and Cross-Appellant, v. Robert A. KOPPELMAN, Appellant and Cross-Respondent. Civ. 68753.

Page 629

205 Cal.Rptr. 629

159 Cal.App.3d 627

In re the MARRIAGE OF Shirley M. and Robert A. KOPPELMAN.

Shirley M. KOPPELMAN, Respondent and Cross-Appellant, v. Robert A. KOPPELMAN, Appellant and Cross-Respondent.

Civ. 68753.

Court of Appeal, Second District, Division 5, California.

Aug. 24, 1984.

Trope & Trope, William B. Anderson and Lawrence E. Leone, Los Angeles, for appellant and cross-respondent.

Robert E. Alderman, Jr., Torrance, for respondent and cross-appellant.

FEINERMAN, Presiding Justice.

Shirley and Robert Koppelman separated on September 30, 1974, following 20 years of marriage and the birth of five children, four of them minors at the time of separation. ¹ Shirley Koppelman (wife) filed a petition for dissolution of marriage on that date, and Robert Koppelman (husband) Throughout the six-year separation period, wife lived in the family home with the minor children and worked as a nurse. Her gross annual earned income ranged from $10,881.87 to $19,384 during those years. She also received approximately $500 per year in interest income from funds which were her separate property. During those years, husband established a residence with another woman and shared living expenses with her. Husband was employed as an insurance agent by the Knights of Columbus, earning a gross annual income ranging from $47,183 to $69,957. In those six years he gave wife approximately $10,000 to be used for general expenses of running the household. He also gave her approximately $7,000 to forward to their daughter who was attending college. (By that time the daughter was no longer a minor.) The record further indicates that husband had paid some extraordinary community expenses, including a $400 plumbing bill and legal expenses incurred on behalf of a minor son.

                filed a response on October 29, 1974.  No further action was taken by either spouse until February 1980, when wife set the matter for trial and moved to value the family residence on Kansas Street in El Segundo as of the 1974 separation date.  (Both parties agree the residence on Kansas Street is a community asset.)   At no time in the course of the separation period was an order or agreement for child support or spousal support made or entered into by the parties
                

For a substantial portion of his term of employment with the Knights of Columbus, husband acted as a general agent. In this capacity he received commissions on policies that other agents sold, and salaries were paid to those agents by the Knights of Columbus on husband's behalf. If the salaries exceeded the commissions earned by the subordinate agents, husband was debited for the overages. In addition, husband's commissions were amortized over a number of years. This meant that he received commissions, which admittedly were community property income, on policies which he sold before separation at the same time he received separate property income from commissions on policies sold after separation. Husband made no attempt to segregate the two types of income. He retained possession of the community property income and paid no interest to wife on this income. ²

After separation, husband purchased real property on East 54th Street in Los Angeles. The trial court found that it was "impossible to determine what assets were used to purchase [this property] by reason of the commingling of separate and community assets by [husband]. The source of payments made on any mortgages on said property are [sic] equally obscure by reason of commingling."

The court granted wife's motion to value the Kansas Street residence as of the 1974 date of separation, thus giving wife all the benefit of the considerable appreciation in the value of the property which had taken place between 1974 and 1980. The court found the fair market value of the family residence was $60,000 on October 15, 1974, and $170,000 on December 24, 1980. During that period of time, the encumbrance secured by a deed of trust on the residence had been reduced from $12,600 to $9,200.

The court made the following conclusions of law relevant to this disposition: "2. The court cannot make a retroactive Order for child support. [p] 3. Subsequent to January 1, 1975, the parties have been each trustees for the benefit of the other with regard to community property in their possession. [p] 4. Prior to January 1, 1975, the respondent was trustee for the benefit of the petitioner with regard to community property coming into his possession. [p] 5. As a matter of equity, the Court determines that the only way to reimburse the petitioner for respondent's breach of trust in failure to contribute reasonable support Husband appeals from that part of the interlocutory judgment of dissolution of marriage which awarded the family residence on Kansas Street in El Segundo to wife at its value as of October 15, 1974, the approximate date of separation. He asserts that no good cause was shown to value the property at a date prior to trial.

                to the children of the parties and failure to account for and distribute community property income received at a time of [159 Cal.App.3d 631] great need by the petitioner is to grant the petitioner's motion to value the family residence at the October 15, 1974, date and to fail to pay any prejudgment interest on the community funds received by the respondent after separation and unaccounted for by the respondent to petitioner, the real property at 150 East 54th Street being affirmed as respondent's separate property even though it was his burden to show the source of down payment and subsequent payments."   The court awarded the family residence to wife as her separate property, computing the value of its equity at the 1974 appraised figure of $47,400, and charged husband with the net receipt of $57,529.63 in community assets 3 derived from earnings, and assigned to him the sole responsibility for payment of a $5,000 community debt. 4
                

VALUATION OF THE FAMILY HOME

Civil Code section 4800, subdivision (a) directs the court to value community assets and liabilities "as near as practicable to the time of trial, except that, upon 30 days' notice by the moving party to the other party, the court for good cause shown may value all or any portion of the assets and liabilities at a date after separation and prior to trial to accomplish an equal division of the community property and the quasi-community property of the parties in an equitable manner." We are asked to determine whether the trial court's conclusions of law, supported by its findings of fact, justify its holding that good cause was shown to value the family residence as of the date of separation in order to divide the community property in an equitable manner.

This subject was discussed in In re Marriage of Stallcup (1979) 97 Cal.App.3d 294, 158 Cal.Rptr. 679. There, the trial court's decision to value community property as of a date near separation was affirmed. Husband had answered wife's interrogatories regarding business transactions only after her motion to compel answers was granted. He had frustrated efforts by a court appointed CPA to obtain tax returns and other papers and documents, and the court found he had wilfully refused discovery and disobeyed court orders. The trial court noted inconsistencies in his testimony and in his bank loan applications and deposition statements regarding current assets and liabilities and concluded he was not a credible witness. The trial court valued the property at the earlier date to simplify the accounting and to eliminate the inference that the failure to provide discovery was calculated to conceal evidence unfavorable to husband. On appeal, the court found "both good cause and equitable division" under those circumstances, remarking that "Having failed to provide timely evidence of his claimed post-1973 business reverses, husband may not now benefit from the confusion thus created ...." (Id., at p. 301, 158 Cal.Rptr. 679.)

The trial court's decision to value the family residence as of the date of separation was reversed in In re Marriage of Priddis (1982) 132 Cal.App.3d 349, 184 Cal.Rptr. 37. There, the wife had occupied an apartment and the husband had remained in the community home during a separation period that exceeded eleven years. Husband had paid all home expenses as well as numerous community debts, and the $13,000 home mortgage which had existed at the time of separation was paid off prior to the date of trial. The appellate court found no good cause existed to value the community property as of the separation date. Although husband had made the mortgage payments, he also had exclusive use of the home for over 11 years. During that period of time, wife owned half the residence but received no benefit from it. No evidence was presented that the increase in value of the home resulted from husband's efforts, rather than from an inflationary real estate market. Of particular interest here, the court stated: "The fact that Reid paid numerous community debts in addition to the mortgage during that 11-year period is not sufficient good cause to justify valuing the residence as of 1967 and depriving Nancy of her share of its greatly increased value; on remand, Reid should be credited with those other payments when the court reconsiders the value of the community property." (Id., at p. 356, 183 Cal.Rptr. 37.) ⁵

In the case at bench, the trial court based its decision on the two grounds expressed in its fifth conclusion of law. The first of these was that wife should be reimbursed for husband's "breach of trust in failure to contribute reasonable support to the children of the parties ...." Manifestly, this was an inappropriate ground for the court's decision.

Both parents have an equal responsibility to support their child "in the manner suitable to the child's circumstances, taking into consideration the respective earnings or earning capacities of the parents" (Civ.Code, §§ 196, 242; State of Florida ex...