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IN RE MARRIAGE OF MENDLOWITZ, B225281. (2011)

Court: Court of Appeals of California Number: incaco20110914043 Visitors: 10
Filed: Sep. 14, 2011
Latest Update: Sep. 14, 2011
Summary: NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS ARMSTRONG, Acting P. J. Paul Mendlowitz appeals from a judgment on reserved issues in the dissolution proceedings concerning his marriage to Sandra Mendlowitz. We affirm in part and reverse in part. Background 1 The parties were married on April 1, 2003, and separated on September 15, 2006. A judgment of dissolution was entered on May 14, 2009. Trial on the division of assets took place on February 13, and March 6, 2009. Paul sought, inter alia, t
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NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

ARMSTRONG, Acting P. J.

Paul Mendlowitz appeals from a judgment on reserved issues in the dissolution proceedings concerning his marriage to Sandra Mendlowitz. We affirm in part and reverse in part.

Background1

The parties were married on April 1, 2003, and separated on September 15, 2006. A judgment of dissolution was entered on May 14, 2009. Trial on the division of assets took place on February 13, and March 6, 2009. Paul sought, inter alia, to have various obligations declared community obligations. He also asked for reimbursement under In re Marriage of Epstein (1979) 24 Cal.3d 76 and that Sandra be assessed charges under In re Marriage of Watts (1985) 171 Cal.App.3d 366. In April 2009, before any judgment was entered, Paul filed for bankruptcy.

In January 2010, after Paul was discharged from bankruptcy, the court held a trial setting conference and ordered the parties to submit further briefing on the effect of the bankruptcy on community property issues. The trial setting conference was continued until February 23, 2010. On that date, the case was set for trial on March 2, 2010. On March 2, the court took evidence and heard argument.

Relevant to this appeal, the court found that:

— Paul was ordered to pay pendente lite spousal support of $3,500, later reduced to $3,000, per month. Support terminated on November 30, 2009, when Sandra remarried. By the time of the judgment, Paul had paid only $6,873 and owed $101,626.75, plus interest thereon. The court found that Paul "has failed to meet his burden of proof to show that any additional payments were made and the court specifically finds [Paul] has failed to prove his contention that he should receive credit for payments of $15,000 . . . ." — As to community debt, the court found "[b]ecause of the intervening personal and corporate Bankruptcies, the court finds no remaining community assets, property or community debts to value or divide except for items spared from the Bankruptcy proceedings including but not limited to retirement funds, [Sandra's] intellectual property, the contents of a storage locker in Chatsworth, and IRS debt." The rulings on the retirement funds, IRS debt, and content of the storage locker are not challenged here. — On Sandra's intellectual property, the court found "[Sandra] has a single one-person play that she wrote before, during, and after marriage and that she has played using various names and in under different titles. The play is apparently autobiographical based upon [Sandra's] entire life or life changes. [Sandra] contends that the play is ever changing and has no value. [Paul] contends that it is of great value because the play was produced and played for income to [Sandra] in the past. [Sandra] testifies that she did receive money to perform the play but that the income has never equaled the expenses. There may be a community component of this play, but it is not defined by any competent evidence. There is no competent evidence of value. The court is left to speculate as to value. Accordingly, the court finds that the play has no value and awards the play and all rights thereto to [Sandra]." — On the question of reimbursement, the court found that neither party was entitled to any reimbursement from the other and specifically found that "[Paul's] claim for Epstein charge to [Sandra] for [Sandra's] use of a community residence is denied. The home was lost to foreclosure and no competent evidence of reasonable rental value was produced."

Discussion

A. Support arrearages

The court found that Paul had paid only $6,873 in support. Paul contends that the finding is not supported by the evidence, and given that the parties stipulated that he had paid $15,000, we agree.

The evidence on this point is as follows: in May 2008, in connection with a motion for attorney's fees and costs, Sandra declared that "since [the support] order was entered, I have received $11,872.50. Of this amount, Paul paid $8,000 (June 2007 and January 2008), and the remaining sum, $3,872.50, was paid from the receivership estate."

During the initial phase of the trial, in 2009, Paul testified that he had paid about $14,000, and also presented evidence that Sandra had received (in addition to other amounts) $1,382.41 in December 2007, when she garnished a bank account.

At the 2010 hearing, Sandra testified that Paul had paid her $3,000 in June 2007, and that she had received an additional $3,873.25 from the receiver. Paul testified that she had received approximately $15,000: $3,000 which he paid in June 2007, $5,000 which he paid in January of 2008; $1,500 in garnishment of a bank account, and sums from the receiver.

The court then asked Sandra "Can you live with $15,000 figure?" She answered "Fine. . . . He can just deduct it from what he owes."

Given that Sandra agreed that Paul had paid $15,000, we can see no support for the trial court finding that Paul did not carry his burden on this issue. The judgment must be modified to show that Paul paid that sum, and arrearages must be accordingly reduced. Paul also asks that arrearages be reduced on account of a tax bill which he paid. The evidence was as follows: Paul testified that he had paid a tax bill in the amount of $4,874, and that it was a community debt. Sandra stipulated that half the debt was owed by her. The judgment does not allocate this debt, and as Paul contends, his support arrearages must be reduced by the amount which Sandra owed to him on this community debt.

B. Community property

1. Allocation of "community debt"

Paul contends that the court erred by allocating over $2 million of community debts and liabilities to him. He makes a number of arguments in support of his position that two pieces of real property were community property (and that the trial court erred in the February 2009 hearing by refusing to allow him to present evidence on the issue) and that various other debts were community debts. He argues that he was entitled to reimbursement for half of the community debt.

However, as Sandra argues, the judgment did not allocate community debt to Paul, but instead found that after the foreclosures and bankruptcy, there was no debt.

In response to this argument, Paul contends that he is challenging earlier orders, arguing that prior to the bankruptcy, the court found that foreclosures on the real property had mooted the community property issues. We can see no such rulings at the cited pages, but that is beside the point. Paul has not challenged the trial court's finding that there was no community debt, and that finding is dispositive. If there was no debt, there was no debt to divide.

In his reply brief, Paul attempts to address this problem by arguing that he discharged community debt in the bankruptcy, resulting in a windfall to Sandra, and that his support obligations should have been offset by this windfall. He argues that the "windfall rightfully belongs to the community, which means that half of it belongs to Paul." The argument is frankly difficult to understand. It is also unavailing. The debts were discharged in bankruptcy. It doesn't matter whether they were community debts before they were discharged. They were discharged, and Paul is not entitled to any credit or reimbursement for a debt which he did not have to pay.

People v. Dalvito (1997) 56 Cal.App.4th 557, on which Paul relies, concerns Penal Code section 1203.04 and restitution orders in a criminal case, and has no relevance here.

2. Sandra's play

Paul argues that the court erred in finding that the play was Sandra's separate property, citing the rule that "any artistic work created during the marriage constitutes community property." (In re Marriage of Worth (1987) 195 Cal.App.3d 768, 773.)

The evidence was as follows: Sandra wrote the play before the marriage. During the marriage some community funds were put into producing it at a 99-seat theatre and at a festival in New York. Because the play was autobiographical, it was constantly changing. Sandra testified that no production had ever made a profit, and Paul testified that the play was worth $250,000.

Paul argues that there is evidence that the community spent over $200,000 on producing the show, but we see no such evidence, only Paul's argument, at the 2010 hearing, that evidence to that effect had been produced at the 2009 trial.

Given the evidence that the play was written prior to the marriage, we can see no error in the trial finding that it was Sandra's separate property.

C. Epstein and Watts credits

Paul claimed that he was entitled to reimbursement from the community because he "paid the bills" on a condominium Sandra lived in after the separation (In re Marriage of Epstein, supra, 24 Cal.3d 76) and also claims that Sandra should have been assessed charges (In re Marriage of Watts, supra, 171 Cal.App.3d 366) for her use of the condominium.

Under In re Marriage of Epstein, "a spouse who, after separation of the parties, uses earnings or other separate funds to pay preexisting community obligations should be reimbursed therefor out of the community property upon dissolution." (Id. at p. 84.)

Paul's claim for credits must fail because he did not show that he paid the obligations. (Indeed, the condominium was lost to foreclosure.) Paul argues that the lack of evidence does not matter, contending that "[w]hether Paul paid them or not, he incurred the obligations and became responsible for making the payments." With this, we cannot agree. Paul is not entitled to credits for obligations he did not pay.

Paul also claims that he would have introduced the evidence if the court had not deemed the issue moot, but the cited page of the reporter's transcript does not show that the court prevented Paul from introducing his evidence. Instead, in the cited portion of the transcript, Paul seems to have been in the process of introducing evidence on community debt, in proof of his contention that he owed $15,000 to Washington Mutual at the time of separation. The court responded that the proffered evidence was not sufficient to allow the court to determine the amount of the debt. Paul informed the court that he did not have additional documentary evidence, and asked "But does my testimony count for anything, your honor?" The court answered "Well, I can hear your testimony, but it really doesn't help me." These are not rulings preventing Paul from introducing evidence relevant to Epstein credits.

As to Paul's request for reimbursement for Sandra's use of the condominium, the trial court found that ". . . no competent evidence of reasonable rental value was produced." Paul argues that there was such evidence, with the evidence that the year before Sandra lived in the condominium, a tenant had paid between $4,000 and $4,500 in rent. He argues that he attempted to introduce additional evidence, but that the court wrongly sustained objections to the evidence.

We see no abuse of discretion in the trial court's finding on this issue. (Watts, supra, 171 Cal.App.3d at p. 374; In re Marriage of Hebbring (1989) 207 Cal.App.3d 1260, 1272.) Paul offered no evidence that the rate his tenant paid was the prevailing market rate for that period, or that it was the rate during the period in which Sandra lived in the condominium. Nor do we see the relevance of the evidence the trial court excluded, which concerned the tenant's poor credit, and problems collecting the rent. Such evidence would not tend to show the fair market rental value at the relevant time.

D. Other contentions

Paul raises a number of other contentions. The first is that the trial concluded in 2009, and that the court abused its discretion when it resumed trial in March 2010. We can see no abuse of discretion in the court's decision to take evidence to determine whether the bankruptcy and the passage of time had made relevant changes in the parties' situations — which indeed it did.

Paul next contends that he did not receive notice that trial would be held on March 2, 2010, but instead believed that it was a trial setting conference. As the trial court noted, the minute order of the February 23 trial setting conference established that the matter was set for trial on March 2, and that Paul had notice of that fact.

He next argues that the court improperly failed to consider his April 2, 2009 closing argument, which the trial court had ordered to be submitted by email. He contends that, contrary to a finding in the judgment, the pleading was timely filed, and that he was prejudiced by the error because the final judgment did not take his arguments into account.

Even if the pleading was timely filed, and even if the court did not consider the arguments, we see no reversible error. The arguments Paul made in his pleading are the arguments he makes here concerning community property, reimbursements, and so on. They are in large part obviated by the bankruptcy. He has not established that the court's failure to consider his brief led to error in the judgment itself, and that is what matters.

We say the same about Paul's argument that Sandra's February 18, 2010 pleading was an improper trial brief, and that the court should not have considered that brief. Even if that were so, he cannot establish prejudice unless he establishes that the error resulted in a ruling was incorrect or an abuse of discretion. He has not done so.

Disposition

The matter is remanded to the trial court so that judgment may be modified to reflect that as of the date of the judgment Paul had paid $15,000 in support and to make a corresponding adjustment to the calculation of the arrearages he owed Sandra, and further modified to reduce the arrearages by $2,437, one-half of the community debt which Paul paid. The judgment is in all other respects affirmed. The parties are to bear their own costs on appeal.

MOSK, J. and KRIEGLER, J., concurs.

FootNotes


1. We deny Sandra's request that we take judicial notice of documents pertaining to Paul's bankruptcy or to hers. The documents are not helpful to the resolution of any issue on appeal.
Source:  Leagle

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