Marriage of Motiska & Ford

CourtCalifornia Court of Appeal
DecidedNovember 8, 2023
DocketA166543
StatusPublished

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Bluebook
Marriage of Motiska & Ford, (Cal. Ct. App. 2023).

Opinion

Filed 11/8/23

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FOUR

In re Marriage of DALE MOTISKA and CAROLINE FORD. A166543

(Solano County Super. Ct. DALE MOTISKA, No. FFL122184) Appellant, v. CAROLINE FORD, Respondent.

This interlocutory appeal arises from a marital dissolution proceeding involving appellant Dale Motiska and respondent Caroline Ford, who married in January 2001 and separated in 2011. Motiska challenges a trial court order determining he did not have a reimbursement claim under Family Code1 section 2640 based on an asserted contribution of separate property to a corporation that the court found was a community asset.2

1 Undesignated statutory references are to the Family Code.

2 Section 2640, subdivision (b) states in part:“In the division of the community estate under this division, unless a party has made a written waiver of the right to reimbursement or has signed a writing that has the effect of a waiver, the party shall be reimbursed for the party’s contributions to the acquisition of property of the community property estate to the extent the party traces the contributions to a separate property source.”

1 Motiska argues the court erred by declining to allow him to present evidence of his separate property contributions and by concluding he had no claim under the statute. We publish our opinion resolving this appeal because the principal question raised here—whether a spouse’s sale of property to the marital community for the nominal amount of $1 constitutes a de facto gift, triggering a right to contribution under section 2640—is a matter of first impression. We answer that question no. Finding no error, we affirm the challenged order. I. BACKGROUND3 A. Neon Palm Nursery and Buxup Corporation In 1983, Motiska began operating a nursery business called Neon Palm Nursery (Neon Palm) as a sole proprietorship. Prior to his January 2001 marriage to Ford, Motiska was married to Cynthia Motiska (Cynthia).4 Motiska and Cynthia divorced pursuant to a status-only judgment in 1999, but litigation pertaining to Neon Palm continued and was ongoing when Motiska and Ford married. As part of a mediated agreement in that litigation, Motiska was awarded Neon Palm as his sole property. This award was confirmed in an interspousal deed filed on April 3, 2002. In early 2001, shortly after his marriage to Ford, Motiska formed a corporation called Buxup Corporation (Buxup) and began using the business

3 As we discuss further below, prior to issuing the order that Motiska

challenges in this appeal, the trial court held two trials on related issues and issued statements of decision. We derive our summary of the underlying facts in part from the court’s findings in those statements of decision. 4 Because Cynthia Motiska shares a surname with appellant Dale

Motiska, we refer to her by her first name for clarity. We intend no disrespect.

2 name Palm Island Nursery (or Palm Island Nursery Outlet); we will sometimes refer to the latter as Palm Island. Specifically, the court found that, in March 2001, Motiska filed a fictitious business name statement registering the name Palm Island Nursery, and that articles of incorporation for Buxup were filed by the Secretary of State on May 15, 2001. The court found that Palm Island began doing business on February 26, 2001, and that both Palm Island and Buxup “were created early in 2001 and began fully operating by August 2001,” i.e., “within the first year of [Motiska’s] marriage to [Ford].”5 The court found that Neon Palm, the preexisting sole proprietorship, ceased doing business in December 2003 and was sold to Buxup for $1. Based on conflicting evidence as to whether the sale occurred in 2001 or 2003 (including discrepancies within Motiska’s own testimony, as well as inconsistent corporate minutes), the court found the sale was in 2003, after Motiska’s ownership of Neon Palm had been confirmed in the litigation with his previous wife.6

5 Motiska states in his appellate brief that Palm Island was “merely a

dba of Buxup,” while Ford states Palm Island was formed as a business and “later incorporated into” Buxup. In its statements of decision, the trial court referred to the corporation at one point as “Buxup Corporation DBA Palm Island Nursery,” while at times discussing Palm Island and Buxup separately. For purposes of this appeal, these varying descriptions of the relationship between Palm Island and Buxup are not material. As we shall discuss, the important question resolved by the trial court was the relationship between Neon Palm (Motiska’s preexisting sole proprietorship) and Buxup (the later-formed corporation). 6 In his appellate briefing, Motiska states he does not dispute that

Neon Palm was sold to Buxup for $1. He asserts in a one-sentence footnote, however, that there is no evidence he “was actually paid the dollar for the sale.” We decline to address this undeveloped point or to question the trial court findings and underlying evidence that the sale occurred.

3 In the present dissolution matter, Motiska initially took the position that Neon Palm and Buxup were the same nursery business, and that Buxup resulted from the incorporation of that business. In briefing in the trial court, Motiska stated both the Neon Palm and Palm Island names were used for a period of time, with different types of purchases invoiced using the different names. But after conducting a trial on the question, the court rejected Motiska’s contention Buxup was a continuation of Neon Palm resulting from incorporation. The court stated Motiska’s formation of Buxup and Palm Island in 2001 was part of an “attempt to ‘incorporate’ ” Neon Palm, but the court found that an incorporation of Neon Palm did not in fact occur and that Buxup was instead “a new and distinct business acquired during the marriage of ” Motiska and Ford, thus giving rise to a presumption that it was a community property asset. In summarizing these events, the court stated that, “[j]ust prior to and early in the marriage to Ms. Ford, Mr. Motiska began the process of ‘incorporating’ ” Neon Palm, after “a crane accident that revealed to Mr. Motiska the liability risks involved as an owner of a sole proprietorship.” The court also noted that, at that time, the business “was subject to litigation between Mr. Motiska and his previous wife.” After considering the evidence presented at trial, the court rejected the argument that Neon Palm was incorporated, finding instead that Neon Palm was purchased by Buxup in 2003. The court concluded in part: “Neon Palm Nursery was an asset that was subject of continued litigation during the time that Buxup Corporation and Palm Island Nursery were created. Neon Palm Nursery did not go through the process of incorporation, and it was only after the nursery was confirmed to Mr. Motiska as his separate property that Buxup Corporation was able to purchase it. Thus, rather than having been

4 incorporated, Neon Palm Nursery was acquired by Buxup Corporation, a separate business established during the marriage.” B. Trial Court Proceedings In the present dissolution matter involving Motiska and Ford, the court conducted extensive proceedings pertaining to the characterization of Buxup as community property or separate property and related claims pertaining to the business. 1.

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