Marriage of Maiberger CA4/2

• Court: California Court of Appeal
• Decided: August 2, 2024
• Docket: E081223
• Status: Unpublished

Opinion

Filed 8/2/24 Marriage of Maiberger CA4/2

NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION TWO

In re the Marriage of LUKE AND KATHERINE MAIBERGER.

LUKE MAIBERGER, E081223 Appellant, (Super.Ct.No. FAMSS1104109) v. OPINION KATHERINE MAIBERGER,

Respondent.

APPEAL from the Superior Court of San Bernardino County. Michael J. Gassner,

Temporary Judge. (Pursuant to Cal. Const., art. VI, § 21.) Affirmed.

Iris Joan Finsilver for Appellant.

Thompson Thompson Valladolid, Byron C. Thompson, and Jeffrey S. Valladolid

for Respondent.

1 This is the second appeal in the marital dissolution proceedings of Luke Maiberger

and Katherine Maiberger.1 In the first appeal, we affirmed the trial court’s order

characterizing certain shares of stock as Luke’s separate property. (In re Marriage of

Maiberger (Nov. 16, 2021, E075261) [nonpub. opn.].) After we affirmed that order, the

court determined that Katherine may pursue a claim for equitable apportionment

concerning the stock. A claim for equitable apportionment arises if one spouse’s efforts

increase the value of their separate property during marriage. (In re Marriage of Dekker

(1993) 17 Cal.App.4th 842, 851 (Dekker).) In that case, “the community should receive a

fair share of the profits which derive from the [spouse’s] devotion of more than minimal

time and effort to the handling of [their] separate property.” (Beam v. Bank of America

(1971) 6 Cal.3d 12, 17 (Beam).) Luke appeals from the order permitting Katherine to

pursue a claim for equitable apportionment. We affirm.

BACKGROUND

I. The parties’ marriage and Luke’s acquisition of the stock

Luke’s parents founded P&R Paper Supply Company, Inc. (the paper company) in

1976. Luke began working for the paper company in 1983, and he and Katherine married

in 1985. Luke’s parents were the sole shareholders of the paper company until 1991. In

1991, Luke’s parents gifted him 24 shares of stock in the paper company. The shares

were valued at $8,000 each for gift tax purposes.

1 We refer to the parties by their first names because of their shared last name. No disrespect is intended. 2 In August 2011, Luke petitioned to dissolve the parties’ marriage. Both the

petition and Katherine’s response asked the court to determine the parties’ property

rights. Both documents also listed the “[c]ommunity interest in P&R Paper” under the

section for declaring community and quasi-community assets. Luke later filed an

amended petition identifying the paper company shares as his separate property.

The court entered a status-only judgment of dissolution in July 2014. The first

page of the status-only judgment stated: “Jurisdiction is reserved over all other issues.”

Page three of the status-only judgment similarly stated: “Jurisdiction is reserved for later

determination of all other pending issues in this case.”

II. Bifurcated proceedings to characterize the shares of stock

In October 2017, Luke filed a request for an order characterizing the shares in the

paper company as his separate property. He asked the court to bifurcate the issue under

rule 5.390(b)(4) of the California Rules of Court, which authorizes the court to

“separately try” whether “property is separate or community” if “resolution of the

bifurcated issue is likely to simplify the determination of the other issues.” (Cal. Rules of

Court, rule 5.390(b) & (b)(4).) The rule identifies “[h]ow to apportion increase in value

of a business” as a different issue that may be separately tried. (Cal. Rules of Court, rule

5.390(b)(5).)

Luke’s memorandum of points and authorities in support of his request explained

the scope of the request as follows: “This brief does not address the appropriate ‘carve

out’ to the community, because Luke first requests a finding that the interest in [the paper

company] is separate property[,] and then evidence can be presented as to the value of

3 those shares via a community carve out if the court grants Luke’s request for orders.”

(Capitalization omitted.)

The court bifurcated the characterization of the shares and set the matter for trial.

Luke’s trial brief argued that they were his separate property because they were a bona

fide gift from his parents. Katherine’s trial brief argued that they were community

property because Luke acquired them during marriage; he lacked evidence to establish

the elements of a gift; and even if his parents called them a gift, they were actually

remuneration in exchange for his work at the paper company.

The court tried the matter over the course of three days in May and July 2019.

Several months later, it issued a statement of intended decision concluding that the shares

in the paper company “and the ownership they represent . . . are [Luke’s] sole and

separate property, and are not includable as community property.”

Shortly after the court issued its intended decision, Luke served Katherine with a

family law at-issue memorandum (San Bernardino County form SB 12389) requesting

that the court set several issues for trial, including the “VanCamp carve-out” issue.

Katherine then filed objections to the statement of intended decision asking the

court for “clarification of the phrase ‘not includable as community property.’” More

specifically, she asked: “Does this statement mean that the shares of stock are separate

property subject to any community property interest? Or is the Court stating that no

community property interest can or may exist regardless of principles [in] Pereira v.

4 Pereira (1909) 156 Cal. 1 and Van Camp v. Van Camp (1921) 53 Cal.App.17?”2 In

response to Katherine’s objection, Luke asserted: “The Court’s intention is clear. The

shares are not community. Since separate property is not divided, it will be awarded to

Luke as his separate property. Katherine can raise any claims of ‘community equitable

apportionment’ in Luke’s separate property.” (Capitalization omitted.)

In the final statement of decision, the court did not change the language on which

Katherine sought clarification. The court concluded that the evidence showed that the

shares in the paper company were a gift from Luke’s parents. The shares consequently

were Luke’s sole and separate property and “not includable as community property.” We

affirmed that decision in November 2021. (In re Marriage of Maiberger, supra,

E075261.)

III. Proceedings after the first appeal

In January 2022, Luke filed a request for an order denying equitable

apportionment or, in the alternative, determining the methodology for apportionment.

His memorandum in support of the request argued that Katherine was estopped from

seeking equitable apportionment with respect to his shares in the paper company, the

court had no jurisdiction over such a claim, and Katherine failed to reserve jurisdiction

over the issue.

2 The two primary methods of equitable apportionment are derived from Pereira v. Pereira (1909) 156 Cal. 1 (Pereira) and Van Camp v. Van Camp (1921) 53 Cal.App. 17 (Van Camp). 5 Around the same time, Luke filed a separate request for an order to release funds

that were being held in a client trust account. The funds apparently were proceeds from

the sale of Luke’s shares in the paper company. The record does not include Luke’s

request regarding the funds, but it includes a reporter’s transcript of the February 2022

hearing on the request. According to Luke’s argument, the paper company had been

sold, and Luke received roughly $17,800,000 for his shares. Luke noted that his request

for an order denying equitable apportionment was pending. The parties nevertheless

made arguments bearing on the issue. For instance, Luke argued that equitable

apportionment “is not a community property right in the res—or in the actual thing.”

Rather, it “is a possible right to reimbursement to the community for the community’s

work and services during the marriage.” He further argued that “equitable apportionment

cannot become a transmutation.” For her part, Katherine argued that she had a

community interest in the growth of the business because Luke worked there. She noted

that the court had not yet heard evidence on the extent of his involvement in the business

and the nature of the business’s growth, and Katherine had not received discovery

bearing on the issue.

At the conclusion of the hearing, the court ordered the funds in the client trust

account released to Luke. The court reasoned that it had found the shares to be separate

property, and the proceeds from their sale were separate property. The court further

explained: “I’m not convinced that there is a meritable argument that, no, some of that

becomes community property because they were married at the time. [¶] He received a

6 considerable salary, and that’s certainly community property. I’m not going to argue that

at all. But the shares, the ownership of that business, is his, in my opinion.”

In October 2022, the court heard Luke’s request for an order denying equitable

apportionment,3 and it issued an order denying the request in January 2023. The court

reasoned that if one or both spouses actively manages a separate property business, and

the business increases in value during marriage, then “the court must apportion the total

economic benefit between community property and separate property.” The court

observed that Luke requested bifurcation on a single issue in 2017—the characterization

of the shares as his separate property. The court had resolved that single issue and no

other property issues. The equitable apportionment claim did not even arise until there

was a determination that the shares were separate property. The court concluded that

Katherine should have the opportunity to present her claim for equitable apportionment.

The court granted Luke’s request to certify its order for immediate appellate

review. (Cal. Rules of Court, rule 5.392(b)-(c) [authorizing the family court to issue a

certificate of probable cause for an interlocutory appeal from an order on a bifurcated

issue].) We then granted Luke’s motion to appeal the order. (Cal. Rules of Court, rule

5.392(d) [authorizing a party to file a motion to appeal once the family court issues the

certificate of probable cause].)

3 A new judicial officer was presiding over the case at this point. The prior judge apparently retired in April 2022. 7 DISCUSSION

Luke argues that the trial court erred by concluding that Katherine could pursue a

claim for equitable apportionment. He contends that Katherine is barred from asserting

the claim under the doctrine of res judicata, she waived her right to seek equitable

apportionment, the court lacks subject matter jurisdiction over the claim, and Katherine

failed to request an express reservation of jurisdiction. All of his arguments lack merit.

“[I]ncome produced by an asset takes on the character of the asset from which it

flows. Thus, rents, issues and profits are community property if derived from community

assets, and separate property if derived from separate assets.” (Dekker, supra, 17

Cal.App.4th at p. 851.) However, a claim for equitable apportionment arises if

community efforts increase the value of separate property. (Ibid.) “[T]he intrinsic

increase of separate property is separate, but the fruits of the community’s expenditures

of time, talent, and labor are community property.” (Id. at p. 850.) Accordingly, “it

becomes necessary to quantify the contributions of separate capital and community effort

to the increase,” and the “community is entitled to the increase in profits attributable to

community endeavor.” (Id. at p. 851.)

There are two primary approaches to equitable apportionment. (Beam, supra, 6

Cal.3d at p. 18.) The Pereira method “allocate[s] a fair return to the separate property

investment and allocate[s] the balance of the increased value to community property as

arising from community efforts.” (Dekker, supra, 17 Cal.App.4th at pp. 852-853.)

Under the Van Camp method, the court determines the reasonable value of the

8 community’s services, allocates that amount to community property, and allocates the

balance to separate property. (Id. at p. 853.)

Luke’s arguments present issues of law that we review de novo. (Lynch v.

California Coastal Com. (2017) 3 Cal.5th 470, 476 [waiver or forfeiture is a legal issue

reviewed de novo if the facts are undisputed]; A.F. v. Jeffrey F. (2023) 90 Cal.App.5th

671, 681 [“When the evidence is not in dispute, subject matter jurisdiction is a legal

issue, which we review de novo”]; Ayala v. Dawson (2017) 13 Cal.App.5th 1319, 1325

[“‘Whether the doctrine of res judicata applies in a particular case is a question of law

which we review de novo’”].)

Luke first argues that Katherine is barred from pursuing equitable apportionment

under the doctrine of res judicata. Res judicata is “an umbrella term encompassing both

claim preclusion and issue preclusion.” (DKN Holdings LLC v. Faerber (2015) 61

Cal.4th 813, 823-824.) Claim preclusion bars relitigation of causes of action. (Id. at

p. 824.) Luke’s argument involves issue preclusion, which “prevents relitigation of

previously decided issues.” (Ibid.) “[I]ssue preclusion applies: (1) after final

adjudication (2) of an identical issue (3) actually litigated and necessarily decided in the

first suit and (4) asserted against one who was a party in the first suit or one in privity

with that party.” (Id. at p. 825.) Luke contends that the order characterizing the paper

company shares as his separate property is a final adjudication barring Katherine’s

equitable apportionment claim. But the issue of equitable apportionment was not actually

litigated and necessarily decided in the bifurcated proceedings regarding the shares.

Luke requested only that the court decide whether the shares were separate or community

9 property. How to apportion any increase in the value of the shares was a different issue

that arose only after the court determined that they were separate property. The parties

did not actually litigate that issue in the bifurcated proceedings, and the order

characterizing the shares did not decide that issue.

In a related vein, Luke argues that Katherine waived the right to seek equitable

apportionment. According to Luke, the court found that the shares were “not includable

as community property,” Katherine recognized an ambiguity in the ruling when she asked

the court to clarify it, and yet she did not challenge that portion of the ruling in the first

appeal. Luke asserts that her failure to bring that challenge amounts to a waiver. But

Luke’s argument rests on an incorrect premise—that the court rejected Katherine’s

equitable apportionment claim when it found that the shares were not includable as

community property. Again, the court did not decide the equitable apportionment issue.

The court’s statement of decision did not discuss whether any increase in the value of the

shares is attributable to community efforts, and if so, how that increase should be

apportioned. And the finding that the shares themselves are not community property is

consistent with the principle of equitable apportionment. The principle does not

transmute the separate property of one spouse into community property. (In re Marriage

of Brandes (2015) 239 Cal.App.4th 1461, 1477.) It merely accounts for community

efforts that increase the value of the separate property. (Ibid.) Katherine’s failure to raise

equitable apportionment in the prior appeal did not waive any such claim, because there

was no equitable apportionment ruling to challenge.

10 Luke next argues that the superior court lacks subject matter jurisdiction over the

equitable apportionment claim. Under Family Code section 2010, the court has

jurisdiction to make orders concerning “the settlement of the property rights of the

parties.” (Fam. Code, § 2010, subd. (e); unlabeled statutory citations refer to this code.)

An equitable apportionment claim involves settling the property rights of the parties, and

Luke does not persuade us otherwise. He asserts that section 2010 does not confer any

power over the separate property of one spouse. It is true that “neither spouse has any

interest in the separate property of the other” (§ 752), but equitable apportionment does

not give one spouse an interest in the separate property of the other. Instead, it is a way

for the court to determine what constitutes separate property and what constitutes

community property. (See, e.g., Beam, supra, 6 Cal.3d at p. 17 [the husband’s efforts in

managing his separate property during marriage “were more than minimal,” so “the trial

court was compelled to determine what proportion of the total profits should properly be

apportioned as community income”].)

Luke lastly argues that Katherine failed to request an express reservation of

jurisdiction over any equitable apportionment claim. Luke’s petition for dissolution and

Katherine’s response to the petition both requested that the court determine the parties’

property rights. Section 2010 gives the court jurisdiction to do that. The status-only

judgment decided dissolution only and expressly reserved jurisdiction over all other

issues. Luke does not explain why all of that was insufficient to reserve jurisdiction over

any equitable apportionment claim, nor does he cite authority for the proposition that

Katherine had to request a specific reservation of jurisdiction over equitable

11 apportionment. He therefore fails to show that the court erred. (In re Marriage of

Falcone & Fyke (2008) 164 Cal.App.4th 814, 822 [appellant has the burden of

demonstrating reversible error].)

DISPOSITION

The order is affirmed. Katherine shall recover her costs of appeal. (Cal. Rules of

Court, rule 8.278(a)(1).)

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

MENETREZ J.

We concur:

MILLER Acting P. J.

RAPHAEL J.