Marriage of Scout CA2/1
Opinion
Filed 8/20/26 Marriage of Scout CA2/1 NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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
SECOND APPELLATE DISTRICT
DIVISION ONE
In re the Marriage of JAMIE B343600 and SCOTT STOUT. _____________________________ (Los Angeles County Super. Ct. No. 19STFL07045)
JAMIE RAE STOUT, ORDER MODIFYING
Respondent, OPINION AND DENYING REHEARING
v.
NO CHANGE IN JUDGMENT
SCOTT FRANKLIN GROVES STOUT,
Appellant.
THE COURT: It is ordered that the opinion filed herein on July 24, 2026, be modified as follows:
1. On page 20, the first full paragraph, beginning “We note that” is deleted and the following paragraph is inserted in its place:
We note that the trial court’s stated goal in applying the CLAM method was to achieve “substantial justice between the parties.” Jamie had a one-half interest in the fruits of Scott’s pre-separation efforts to found and develop MedVector. (See Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 8:336, p. 136.) Scott testified that he “worked [his] tail off” to raise MedVector’s $474,500 in pre-separation capital, without which MedVector “never would have started” and “wouldn’t exist.” Anfuso agreed that without Scott’s pre-separation efforts, MedVector would have had zero pre-separation capital and would have gone out of business. Because Scott’s pre-separation efforts were critical to MedVector’s continued existence, without which his MedVector shares would lack even speculative future value, the trial court did not act arbitrarily in finding that justice was better served by apportioning to the community an interest of 12 percent rather than 1 percent (resulting in an award to Jamie of 6 percent rather than 0.5 percent).
There is no change in the judgment.
Appellant’s petition for rehearing is denied.
____________________________________________________________
ROTHSCHILD, P. J. BENDIX, J. M. KIM, J.
Filed 7/24/26 Marriage of Stout CA2/1 (unmodified opinion)
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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
SECOND APPELLATE DISTRICT
DIVISION ONE
In re the Marriage of JAMIE B343600 and SCOTT STOUT. _____________________________ (Los Angeles County Super. Ct. No. 19STFL07045)
JAMIE RAE STOUT,
Respondent,
v.
SCOTT FRANKLIN GROVES STOUT,
Appellant.
APPEAL from a judgment of the Superior Court of Los Angeles County, Esther P. Kim, Judge. Affirmed.
Quinn & Dworakowski, Stephane Quinn and David Dworakowski for Appellant.
No appearance for Respondent.
_______________________________
Scott Franklin Groves Stout (Scott) appeals from a judgment of dissolution, contending the trial court erred by awarding certain property interests and attorney fees to his exwife , Jamie Rae Stout (Jamie). The principal property dispute concerned Scott’s ownership shares in MedVector, Inc., a startup company that Scott founded before the parties separated. Scott did not dispute that his MedVector shares were a community asset in part, but he argued that the shares should be apportioned between the community estate and his separate estate to account for his post-separation efforts to develop MedVector. The trial court apportioned to the community a 12 percent interest in Scott’s MedVector shares and awarded Jamie one-half of the community interest (6 percent). The trial court also awarded Jamie $14,000 as a remedy for Scott’s sale of a motorcycle in breach of his fiduciary duty, and ordered Scott to pay Jamie’s remaining balance of $35,108 in attorney fees. Finding no error, we affirm the judgment.
BACKGROUND
A. Before separation, Scott founded MedVector, quit his full-time job to focus on the company, and raised $474,500 in capital from third-party investors. Jamie and Scott married in October 2007 and separated on May 1, 2019. They have three minor children.
In July or August 2017 (around one year and eight months before the parties separated), when Scott was working full time as a financial advisor at Wells Fargo, he conceived the idea for a startup company that would become MedVector, based on an innovative method of recruiting patients for clinical trials. A month later, he secured support from a telemedicine provider and
prospective investors to pursue his business idea. While continuing to work at Wells Fargo, he began working on MedVector around five to 10 hours per week. He created MedVector’s name and logo, researched existing companies, and conducted legal outreach.
In December 2017, he incorporated MedVector and Scott became its CEO. MedVector had no other employees or independent contractors at that time. Scott received MedVector shares that initially represented a 90 percent ownership interest in the company.
In April 2018, Scott resigned from Wells Fargo and began receiving $15,000 in monthly income from MedVector. A few months later, he began working as a consultant for Raymond James. Scott’s MedVector work increased to 20 and then 30 hours per week. In December 2018, he acquired an office for his MedVector work. He occasionally traveled on MedVector business.1 By the end of 2018, Scott had raised $474,500 in MedVector capital from third-party investors. He agreed that he “worked [his] tail off” to raise that initial capital. He testified that without the initial capital, MedVector “never would have started”
1 The parties presented conflicting testimony regarding
whether Jamie contributed to some of Scott’s pre-separation MedVector work. Both parties acknowledged that the issue was immaterial because the fruits of Scott’s pre-separation efforts were community property even if Jamie was not involved.
and “wouldn’t exist.” He and Jamie did not invest any of their own money in MedVector.2 Before separation, Scott did not take out or personally guarantee any loans for MedVector. Although he personally guaranteed a MedVector credit card, he used MedVector’s capital to pay the card’s balance every month.
B. After separation, Scott continued working on MedVector full time, raised over $3 million in additional third-party capital, and personally guaranteed MedVector debts. Scott remained MedVector’s CEO through the time of trial.
He stipulated that he received $17,000 in monthly income from MedVector and $4,182 in monthly income from his consulting for Raymond James. Jamie received $1,282 in monthly income from a part-time job at a distillery.
Scott testified that his MedVector work became much “busier” after separation. He further testified that his work exceeded the typical scope of a CEO’s duties “by far,” and included legal compliance, human resources, marketing, public relations, and fundraising. By the time of trial, MedVector had raised a total of $3,807,874 in capital ($474,500 before separation and $3,333,374 after).
After separation, a MedVector credit card that Scott personally guaranteed (as noted above) accrued an unpaid balance of around $130,000. Also after separation, Scott personally guaranteed around $148,000 in small business loans
2 After separation, Scott invested approximately $500 in
MedVector. Scott did not argue below or on appeal that his $500 investment was material.
for MedVector and a $250,000 loan to MedVector from his parents.
MedVector has never generated revenue. Its debts exceed its assets. Scott believes MedVector has the potential to become a multibillion-dollar company.
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Filed 8/20/26 Marriage of Scout CA2/1 NOT TO BE PUBLISHED IN THE 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
SECOND APPELLATE DISTRICT
DIVISION ONE
In re the Marriage of JAMIE B343600 and SCOTT STOUT. _____________________________ (Los Angeles County Super. Ct. No. 19STFL07045)
JAMIE RAE STOUT, ORDER MODIFYING
Respondent, OPINION AND DENYING REHEARING
v.
NO CHANGE IN JUDGMENT
SCOTT FRANKLIN GROVES STOUT,
Appellant.
THE COURT: It is ordered that the opinion filed herein on July 24, 2026, be modified as follows:
1. On page 20, the first full paragraph, beginning “We note that” is deleted and the following paragraph is inserted in its place:
We note that the trial court’s stated goal in applying the CLAM method was to achieve “substantial justice between the parties.” Jamie had a one-half interest in the fruits of Scott’s pre-separation efforts to found and develop MedVector. (See Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 8:336, p. 136.) Scott testified that he “worked [his] tail off” to raise MedVector’s $474,500 in pre-separation capital, without which MedVector “never would have started” and “wouldn’t exist.” Anfuso agreed that without Scott’s pre-separation efforts, MedVector would have had zero pre-separation capital and would have gone out of business. Because Scott’s pre-separation efforts were critical to MedVector’s continued existence, without which his MedVector shares would lack even speculative future value, the trial court did not act arbitrarily in finding that justice was better served by apportioning to the community an interest of 12 percent rather than 1 percent (resulting in an award to Jamie of 6 percent rather than 0.5 percent).
There is no change in the judgment.
Appellant’s petition for rehearing is denied.
____________________________________________________________
ROTHSCHILD, P. J. BENDIX, J. M. KIM, J.
Filed 7/24/26 Marriage of Stout CA2/1 (unmodified opinion)
NOT TO BE PUBLISHED IN THE 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
SECOND APPELLATE DISTRICT
DIVISION ONE
In re the Marriage of JAMIE B343600 and SCOTT STOUT. _____________________________ (Los Angeles County Super. Ct. No. 19STFL07045)
JAMIE RAE STOUT,
Respondent,
v.
SCOTT FRANKLIN GROVES STOUT,
Appellant.
APPEAL from a judgment of the Superior Court of Los Angeles County, Esther P. Kim, Judge. Affirmed.
Quinn & Dworakowski, Stephane Quinn and David Dworakowski for Appellant.
No appearance for Respondent.
_______________________________
Scott Franklin Groves Stout (Scott) appeals from a judgment of dissolution, contending the trial court erred by awarding certain property interests and attorney fees to his exwife , Jamie Rae Stout (Jamie). The principal property dispute concerned Scott’s ownership shares in MedVector, Inc., a startup company that Scott founded before the parties separated. Scott did not dispute that his MedVector shares were a community asset in part, but he argued that the shares should be apportioned between the community estate and his separate estate to account for his post-separation efforts to develop MedVector. The trial court apportioned to the community a 12 percent interest in Scott’s MedVector shares and awarded Jamie one-half of the community interest (6 percent). The trial court also awarded Jamie $14,000 as a remedy for Scott’s sale of a motorcycle in breach of his fiduciary duty, and ordered Scott to pay Jamie’s remaining balance of $35,108 in attorney fees. Finding no error, we affirm the judgment.
BACKGROUND
A. Before separation, Scott founded MedVector, quit his full-time job to focus on the company, and raised $474,500 in capital from third-party investors. Jamie and Scott married in October 2007 and separated on May 1, 2019. They have three minor children.
In July or August 2017 (around one year and eight months before the parties separated), when Scott was working full time as a financial advisor at Wells Fargo, he conceived the idea for a startup company that would become MedVector, based on an innovative method of recruiting patients for clinical trials. A month later, he secured support from a telemedicine provider and
prospective investors to pursue his business idea. While continuing to work at Wells Fargo, he began working on MedVector around five to 10 hours per week. He created MedVector’s name and logo, researched existing companies, and conducted legal outreach.
In December 2017, he incorporated MedVector and Scott became its CEO. MedVector had no other employees or independent contractors at that time. Scott received MedVector shares that initially represented a 90 percent ownership interest in the company.
In April 2018, Scott resigned from Wells Fargo and began receiving $15,000 in monthly income from MedVector. A few months later, he began working as a consultant for Raymond James. Scott’s MedVector work increased to 20 and then 30 hours per week. In December 2018, he acquired an office for his MedVector work. He occasionally traveled on MedVector business.1 By the end of 2018, Scott had raised $474,500 in MedVector capital from third-party investors. He agreed that he “worked [his] tail off” to raise that initial capital. He testified that without the initial capital, MedVector “never would have started”
1 The parties presented conflicting testimony regarding
whether Jamie contributed to some of Scott’s pre-separation MedVector work. Both parties acknowledged that the issue was immaterial because the fruits of Scott’s pre-separation efforts were community property even if Jamie was not involved.
and “wouldn’t exist.” He and Jamie did not invest any of their own money in MedVector.2 Before separation, Scott did not take out or personally guarantee any loans for MedVector. Although he personally guaranteed a MedVector credit card, he used MedVector’s capital to pay the card’s balance every month.
B. After separation, Scott continued working on MedVector full time, raised over $3 million in additional third-party capital, and personally guaranteed MedVector debts. Scott remained MedVector’s CEO through the time of trial.
He stipulated that he received $17,000 in monthly income from MedVector and $4,182 in monthly income from his consulting for Raymond James. Jamie received $1,282 in monthly income from a part-time job at a distillery.
Scott testified that his MedVector work became much “busier” after separation. He further testified that his work exceeded the typical scope of a CEO’s duties “by far,” and included legal compliance, human resources, marketing, public relations, and fundraising. By the time of trial, MedVector had raised a total of $3,807,874 in capital ($474,500 before separation and $3,333,374 after).
After separation, a MedVector credit card that Scott personally guaranteed (as noted above) accrued an unpaid balance of around $130,000. Also after separation, Scott personally guaranteed around $148,000 in small business loans
2 After separation, Scott invested approximately $500 in
MedVector. Scott did not argue below or on appeal that his $500 investment was material.
for MedVector and a $250,000 loan to MedVector from his parents.
MedVector has never generated revenue. Its debts exceed its assets. Scott believes MedVector has the potential to become a multibillion-dollar company.
C. Scott violated pretrial orders, including by selling a motorcycle without Jamie’s consent. At trial, Jamie requested related attorney fees and sanctions. In June 2019, Jamie petitioned for dissolution. Jamie served Scott with the summons, which provided notice of automatic temporary restraining orders (ATROs) against both parties. (See Fam. Code, § 233, subd. (a).)3 One ATRO restrained each party from “transferring, encumbering, hypothecating, concealing, or in any way disposing of, any property, real or personal, . . . without the written consent of the other party or an order of the court, except in the usual course of business or for the necessities of life . . . .” (See § 2040, subd. (a)(2)(A).)
Scott responded to the petition through counsel. He remained represented by counsel throughout the proceedings, except during two months between November 2020 and January 2021.
After separation, Scott withdrew the full $15,000 balance from a joint investment account that he and Jamie held with Raymond James. He subsequently withdrew $40,000 from their joint individual retirement account (IRA) with Raymond James. He withdrew the money to pay unspecified “joint bills.” He did
3 Undesignated statutory references are to the Family
Code.
not give Jamie notice that he planned to withdraw the money from the accounts.
In September or October 2020, without notice to Jamie, Scott sold a Harley-Davidson motorcycle that he had purchased before separation for $14,000. He sold the motorcycle for approximately its original $14,000 purchase price, used some of the sale proceeds to pay off the outstanding balance of the note, and contributed the remaining proceeds to the purchase of another motorcycle.4 He did not transfer to Jamie any of the sale proceeds. He did not inform Jamie that he was going to sell the motorcycle because “[s]he hated it.” He felt he did not need Jamie’s consent to sell the motorcycle.
In response to questioning by the trial court, Scott claimed that when he sold the motorcycle, he was self-represented and unaware of the ATRO prohibiting him from transferring property without Jamie’s written consent. He acknowledged that he had been served with the summons and likely had read the ATRO described therein.
In February 2022, the trial court ordered Scott to pay Jamie temporary child support and spousal support. The court also ordered Scott to reimburse Jamie for half of their children’s medical expenses within two weeks after receiving invoices for such expenses. Finally, the court ordered Scott to pay Jamie $40,000 in need-based attorney fees by March 30.
4 Scott testified that he did not recall the amount of the
outstanding balance on the note at the time he sold the motorcycle, and that he “would be guessing” if he testified about the amount. Later, he “guess[ed]” that the balance was around $10,000.
Scott accumulated arrears on support payments. He did not reimburse Jamie for one-half of the children’s medical expenses.
Scott paid Jamie the $40,000 in court-ordered attorney fees. Although the record does not reveal when Scott paid the fees, the trial court found in its proposed and final statements of decision that his payment was untimely. Scott did not dispute that finding.5 Pursuant to section 2030 (need-based fees) and/or section 271 (fees as sanctions), Jamie asked the trial court to order Scott to pay the remaining balance of her attorney fees (fees as sanctions). And pursuant to section 1101, subdivision (h), Jamie asked the trial court to award her 100 percent of the motorcycle’s value as a remedy for the breach of his fiduciary duty in selling it without her consent.
D. The parties disputed the proper division of Scott’s MedVector shares. “The fruits of a spouse’s expenditure of time, talent and labor during marriage and before separation are community property . . . .” (Hogoboom & King, Cal. Practice Guide: Family Law (The Rutter Group 2025) ¶ 8:336, p. 136.) “Thus, where community efforts [including one spouse’s pre-separation efforts] increase the value of a spouse’s separate property, the increase generally must be apportioned between the separate property
5 Before trial, Jamie filed an order to show cause regarding
contempt based on Scott’s failure to timely pay the $40,000 in attorney fees. The judge then presiding over pretrial matters found Scott not guilty of contempt. Scott does not argue that the not-guilty finding precluded the trial court from finding that he failed to timely pay the fees.
capital investment and community effort.” (Id., ¶ 8:120, p. 55, italics omitted; see also Patrick v. Alacer Corp. (2011) 201 Cal.App.4th 1326, 1340; In re Marriage of Dekker (1993) 17 Cal.App.4th 842, 852 (Dekker).) Conversely, “[t]he fruits of a spouse’s postseparation efforts and skill are their separate property [citations]. Therefore, where a community asset increases in value because of a spouse’s efforts after separation (e.g., a [community property] business operated after separation), the increase must be apportioned between the community and separate estates.” (Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 8:350, p. 143.)
Here, as discussed above, Scott acquired shares in MedVector before separation. At the time of trial, Scott’s shares represented a 61.5 percent ownership interest in MedVector. Although MedVector (and Scott’s shares therein) had no present economic value, testimony indicated that the business had an estimated $10 million in “speculative future value,” at least in part due to Scott’s work to found and develop the company before and after separation.
Jamie argued that Scott’s MedVector shares were community property in full and should be divided equally between the parties. Scott did not dispute the characterization of his MedVector shares as a community asset in part, but argued the shares should be apportioned between the community estate and his separate estate to account for his post-separation efforts to develop MedVector. (Cf. In re Marriage of Lehman (1998) 18 Cal.4th 169, 176 [distinguishing “characterization, i.e., whether the enhancement [of one spouse’s retirement benefits] was a community asset in any part,” from “apportionment, i.e., to what extent the enhancement, if a community asset at least in some
part, belonged to the community and separate estates” (italics added)].)
Scott retained forensic accountant Ron J. Anfuso, CPA, to offer an expert opinion regarding the apportionment of Scott’s MedVector shares between community and separate property.
1. Legal background California courts have developed two principal (but nonexclusive) approaches to apportioning an increase in a business’s value between community efforts and separate capital, which approaches take their names from Pereira v. Pereira (1909) 156 Cal. 1 and Van Camp v. Van Camp (1921) 53 Cal.App. 17. (Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶¶ 8:341-8:342, 8:345, pp. 139, 140-141; Dekker, supra, 17 Cal.App.4th at pp. 852-853 & fn. 14.) “The Pereira approach is to allocate a fair return to the separate property investment and allocate the balance of the increased value to community property as arising from community efforts.” (Dekker, at pp. 852-853.) “The Van Camp approach is to determine the reasonable value of the community’s services, allocate that amount to community property and the balance to separate property.” (Id. at p. 853.)
As noted, the Pereira and Van Camp approaches are not exclusive. (Dekker, supra, 17 Cal.App.4th at p. 852, fn. 14.) In Todd v. McColgan (1949) 89 Cal.App.2d 509, 512-514, the Court of Appeal approved an apportionment approach used by state tax authorities, which had previously been used by federal tax authorities and approved by a federal court in Todd v. C.I.R. (9th Cir. 1945) 153 F.2d 553, 555-557. (See Dekker, at p. 852, fn. 14 [referring to that apportionment approach as “the tax, or Todd, formula”].) Under the Todd formula, “the first figure (a) is an estimate of a fair rate of return on the separate capital
investment . . . . The second figure (b) is an estimate of fair compensation for community efforts on the business. After totaling these two figures (a + b), the allocation ratio for separate property is a ÷ (a + b); for community, the ratio is b ÷ (a + b).” (California Family Law Report, Cal. Family Law Practice (2d ed. 2025) § M.74; see also Todd v. McColgan, at p. 512.)
“[C]ourts have not developed a precise standard in choosing [an apportionment formula], but have endeavored to adopt that formula which is most appropriate and equitable under the circumstances.” (Dekker, supra, 17 Cal.App.4th at p. 853.) “The court has discretion to choose whichever formula will effect substantial justice.” (Ibid.; see also Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 8:347, pp. 141-142.)
2. Anfuso initially opined that the community had a 12 percent interest in Scott’s MedVector shares, relying on an erroneous assumption that the community invested in MedVector’s pre- separation capital. He then opined that because third parties, not the community, invested that capital, the community’s interest was 1 percent. Anfuso testified that he conducted an apportionment analysis under a “capital labor apportionment model” (CLAM) method. As he acknowledged, California appellate courts have not addressed the CLAM method. Anfuso characterized the CLAM method as equivalent to the Todd formula, and as a combination of the Pereira and Van Camp approaches.6
6 Anfuso also testified that he conducted a Van Camp
analysis, under which he concluded that the community had zero
Anfuso did not clearly explain what the CLAM method entails or how he applied it. It appears that Anfuso sought to apportion the community an interest in Scott’s MedVector shares equal to (1) the sum of the community’s capital contributions, if any, plus what he believed to be reasonable compensation for Scott’s pre-separation efforts, divided by (2) the sum of all capital contributions, whether contributed by the community, either spouse’s separate property, or third parties.7 In Anfuso’s initial CLAM analysis, which was reflected in Exhibit YYY (a one-page spreadsheet), he characterized the $474,500 in MedVector capital “raised” before separation as a community contribution. Based on that contribution, he opined that the community had a 12 percent interest in Scott’s MedVector shares and Scott’s separate estate had an 88 percent interest. He acknowledged that in calculating the community’s 12 percent interest, he effectively divided MedVector’s $474,500 in pre-separation capital by its $3,807,874 in total capital. The reasonable compensation that he assigned to Scott’s pre- separation efforts had no material impact on his calculation.
interest in Scott’s MedVector shares (apparently because Scott’s total income from MedVector before and after separation exceeded the reasonable value of Scott’s pre-separation efforts). Anfuso did not discuss any Pereira analysis.
7 Anfuso did not explain why his CLAM analysis treated all
capital invested by third parties as equivalent to a contribution from Scott’s separate property, such that the more capital third parties invested, the more interest in Scott’s MedVector shares would be apportioned to Scott rather than the community. Scott’s appellate brief summarizes the conclusions that Anfuso reached by applying the CLAM method but does not explain how Anfuso applied that method.
Anfuso, however, agreed that without Scott’s pre-separation efforts to raise funds, MedVector would have had zero pre- separation value and would have gone out of business.8 Anfuso testified that his initial CLAM analysis characterized MedVector’s $474,500 in pre-separation capital as a community contribution because he erroneously assumed that the community invested that capital. During a pause in his testimony, Anfuso performed a revised CLAM analysis that attributed the pre-separation capital to third parties (and effectively treated that capital as equivalent to a contribution from Scott’s separate estate). He offered a revised opinion that the community had a 1 percent interest in Scott’s MedVector shares and Scott’s separate estate had a 99 percent interest. He opined that apportioning the shares in that manner was equitable because, in his view, most of Scott’s work on the business occurred after separation. Anfuso did not explain how he calculated the community’s 1 percent interest. No document reflecting his revised CLAM analysis was offered into evidence.
In Scott’s trial brief, relying on Anfuso’s initial CLAM analysis, Scott argued: “When applying the CLAM method in this case, Scott’s work on MedVector during the marriage . . . represents 12% of the community’s total interest in the
8 Anfuso’s view of reasonable compensation for Scott’s pre-
separation efforts was based on what he determined to be reasonable base pay (excluding other compensation such as stock options) for Scott’s work as CEO beginning when MedVector incorporated in December 2017 (excluding Scott’s MedVector work earlier in 2017). Anfuso acknowledged that in 2021, MedVector hired a CFO, a COO, and an advisor, each of whom received stock options in addition to base pay.
company.” In closing argument, relying on Anfuso’s revised analysis, Scott argued that the community’s interest was only 1 percent.
In a single sentence, Scott’s trial brief argued that if, in the future, MedVector failed and did not pay its debts that Scott had personally guaranteed, Jamie must be responsible for a portion of those debts. Subsequently, Anfuso testified that whether Scott personally guaranteed any MedVector debt was irrelevant to the apportionment analysis, “especially if he did that after the parties’ date of separation . . . .” In closing, Scott did not renew his argument that Jamie should be responsible for any portion of MedVector’s debts. Instead, he argued that because he alone bore the risk of paying those debts if MedVector failed, it was equitable to offset that risk by apportioning 99 percent of his shares to his separate estate pursuant to Anfuso’s revised CLAM analysis.
E. In its proposed statement of decision, the trial court awarded Jamie a 6 percent interest in Scott’s MedVector shares, awarded her $14,000 as a remedy for Scott’s sale of the motorcycle, and ordered Scott to pay Jamie’s balance of $35,108 in attorney fees. The trial court issued a detailed, 26-page proposed statement of decision. The trial court rejected Jamie’s request to divide Scott’s MedVector shares equally between the parties, explaining: “The Court finds that a division in kind would not achieve substantial justice between the parties as it would completely discount Respondent’s separate property efforts to build MedVector, post separation, for the past five years. Further, it was primarily Respondent’s efforts, even during the marriage from inception to growth, which made MedVector into
the existence that it is today. Moreover, the Court heard testimony as to multiple loans secured by Respondent to continue growing MedVector, post separation.”
The trial court found that apportioning Scott’s MedVector shares pursuant to Anfuso’s CLAM method “would achieve the Court’s goal of substantial justice between the parties.” The court agreed with Anfuso’s initial CLAM analysis and initial conclusion that the community’s interest in Scott’s MedVector shares was 12 percent (as reflected in Exhibit YYY). Noting that Anfuso’s initial analysis treated MedVector’s $474,500 in pre- separation capital as a community contribution, the court stated: “[W]hile testimony was received that neither Petitioner nor Respondent invested actual monies into MedVector, Exhibit YYY, considered the monies raised during the marital period. Therefore, the Court will determine $474,500 as community funds as they were raised during the marital period, regardless of actual monies invested by the parties.” (Original italics.) The trial court awarded Jamie a 6 percent interest (one-half of the community’s 12 percent interest) in Scott’s MedVector shares.9 The trial court found that Scott breached his fiduciary duty by selling his Harley-Davidson motorcycle without obtaining Jamie’s written consent. As to the remedy for that breach, the trial court stated: “The Court finds that Respondent’s breach of
9 Although Scott states that the trial court awarded Jamie
a 6 percent interest “in MedVector,” the court agreed with Anfuso’s initial conclusion that the community had a 12 percent interest in Scott’s MedVector shares, not all MedVector shares. The trial court lacked jurisdiction over MedVector shares owned by third parties. (See § 2010, subd. (e); Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶¶ 8:901, 8:907, pp. 335, 338.)
fiduciary duty to Petitioner, by his conduct of selling the Harley Davidson motorcycle to upgrade to a newer model, w[as] within the ‘ambit’ of Civil Code § 3294, the standard for an award of punitive damages in a civil action. Therefore, Petitioner is entitled to an award of 100% of the value of this asset. . . . [A]s the Court heard testimony from Respondent that he sold the 2016 Harley Davidson for $14,000, the Court awards to Petitioner that amount.” The court discredited Scott’s testimony that when he sold the motorcycle, he was self-represented and unaware of the ATRO prohibiting the sale without Jamie’s written consent. The court additionally observed: “Respondent’s testimony and demeanor in Court showed that he did not believe that he needed Petitioner’s permission to sell the motorcycle, leading to this Court’s award to Petitioner for the full amount of the breach. And, as the Court will further describe below, Respondent’s conduct shows a pattern of disregard for the Court’s orders and breach of fiduciary duty.”
Finally, the trial court ordered Scott to pay Jamie’s remaining balance of $35,108 in attorney fees. The court agreed with Jamie that a fee award was warranted under both section 2030 (need-based fees) and section 271 (fees as sanctions).
Regarding need-based fees, the trial court explained: “The Court finds that there is a disparity in access to funds and that Respondent has the ability to pay all of both parties[’] legal fees incurred in this case. Respondent’s salary is $20,000 a month, with Petitioner earning $1,282.64 a month. There is no doubt that Respondent is the higher wage earner. The case was somewhat complicated in that the division of MedVector was a difficult one to determine, requiring an expert to be retained. The attorneys on both sides are well qualified and the fees
incurred in this five-year litigation were reasonable, while the delay was not.”
The trial court continued: “As to the delay in litigation and Petitioner’s request for section 271 attorney fees, the Court notes that, at the very least, Petitioner has shown that Respondent has engaged in six separate instances, a disregard for the Court’s order: (1) order for reimbursement of medical expenses for the children; (2) a prior order for attorney fees that was not paid on a timely basis; (3) arrears that has accumulated, without payment for support; (4) withdrawal of funds from the Raymond James [investment] account, in violation of the ATROS; (5) withdrawal of funds from the retirement IRA, in violation of the ATROS, and (6) the sale/upgrade of the motorcycle in violation of the ATROS. [¶] The Court finds those instances to contribute to the award of attorney fees in the amount of $35,108 . . . .”
F. Scott objected to the proposed statement of decision.
In its final statement of decision, the trial court determined the objections did not require a response and reiterated its prior findings and analysis. Scott objected to the trial court’s proposed statement of decision, arguing that: (1) the trial court did not address Anfuso’s testimony that Exhibit YYY reflected an erroneous assumption that the community invested MedVector’s $474,500 in pre-separation capital; (2) the court improperly failed to assign Jamie any portion of the MedVector debts that Scott personally guaranteed; (3) the court’s findings and the evidence were insufficient to support the $14,000 award to Jamie under section 1101, subdivision (h); (4) the court failed to make an adequate finding that Scott had the ability to pay Jamie’s attorney fees; (5) the court improperly failed to specify how much of the $35,108
attorney fee award constituted need-based fees and how much constituted fees as sanctions; and (6) the evidence did not support the award of fees as sanctions.
The trial court issued a final statement of decision, which reiterated the proposed statement of decision’s findings and analysis summarized above. The trial court addressed Scott’s objections as follows: “[T]he Court finds many of [Scott’s] stated objections do not address an ambiguity or raise controverted issues the Court did not address. Rather the objections attempt to reargue the case, challenge credibility findings, or state disagreement with this Court’s ruling. The Court is not required to provide specific answers to those questions so long as the statement of decision fairly discloses its determination of these issues. [Citation.] Further, the Court is not required to address how it resolved intermediate evidentiary conflicts or respond point by point to the various issues posed in the Respondent’s objections which are a restatement of his position and argument of the case. [Citation.] Further, Respondent . . . requests this Court to consider arguments not raised at trial, which is improper.”
The trial court entered judgment based on its final statement of decision. Scott filed a timely notice of appeal.
DISCUSSION
A. The trial court did not err by awarding Jamie a 6 percent interest in Scott’s MedVector shares without assigning her any portion of the MedVector debts that Scott personally guaranteed. As noted, in apportioning property interests between the community estate and a spouse’s separate estate, a trial court
“has discretion to choose whichever formula will effect substantial justice.” (Dekker, supra, 17 Cal.App.4th at p. 853; see also Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 8:347, pp. 141-142.) The trial court’s application of its chosen apportionment formula is reviewed for abuse of discretion. (Dekker, at pp. 849, 855; In re Marriage of Brooks (2019) 33 Cal.App.5th 576, 589.) The trial court’s factual findings are reviewed for substantial evidence.10 (Brooks, at pp. 589, 597.)
Here, the trial court applied the CLAM method advanced by Scott and his expert, Anfuso. Scott does not challenge the trial court’s decision to apply that method. He, however, argues that no substantial evidence supports the trial court’s finding that the community had a 12 percent interest in Scott’s MedVector shares and the court abused its discretion by failing to assign Jamie a portion of the MedVector debts that Scott personally guaranteed.
1. Substantial evidence supports the trial court’s finding that the community had a 12 percent interest in Scott’s MedVector shares. In finding that the community had a 12 percent interest in Scott’s MedVector shares, the trial court relied on Anfuso’s initial CLAM analysis, as reflected in Exhibit YYY. In his initial analysis, Anfuso concluded that the community had a 12 percent interest in Scott’s MedVector shares because Scott’s community efforts resulted in raising $474,500 in capital, which amount
10 Scott argues that alleged deficiencies in the trial court’s
statement of decision affect the standard of review by precluding application of the doctrine of implied findings. We address the alleged deficiencies in our discussions of the substantive issues to which they relate.
represented 12 percent of the $3,807,874 in total capital that MedVector raised before and after separation.
Scott argues that Anfuso’s initial CLAM analysis is not substantial evidence of a 12 percent community interest because Anfuso testified that he characterized MedVector’s $474,500 in pre-separation capital as a community contribution for an erroneous reason, i.e., his erroneous assumption that the community invested that capital. Scott, however, does not address the trial court’s finding that Anfuso correctly characterized that capital as a community contribution for an alternative reason, i.e., the capital was raised before separation by Scott’s efforts. That finding contradicts Scott’s assertion that the trial court’s statement of decision contains no finding “explaining why the court relied on [Anfuso’s] withdrawn calculation . . . .”
Scott argues that because the trial court adopted Anfuso’s CLAM method and because no other witness contradicted Anfuso’s revised CLAM analysis, the law required the court to adopt Anfuso’s revised conclusion that the community’s interest was only 1 percent. We disagree. Generally, the trier of fact may reject even uncontradicted expert testimony, as long as it does not act arbitrarily. (Howard v. Owens Corning (1999) 72 Cal.App.4th 621, 632; see also In re Scott (2003) 29 Cal.4th 783, 823 (Scott) [“The fact finder determines the facts, not the experts. Indeed, the fact finder may reject even ‘a unanimity of expert opinion’ ”].)
Here, Anfuso did not explain how, in his revised CLAM analysis, he calculated the community’s 1 percent interest. The record contains no document from which we might discern such an explanation, because no document reflecting Anfuso’s revised
analysis was offered into evidence. Absent any explanation of Anfuso’s reasoning, the trial court did not act arbitrarily by rejecting Anfuso’s revised opinion. (See Scott, supra, 29 Cal.4th at p. 823 [“ ‘ “The chief value of an expert’s testimony . . . rests upon the material from which his opinion is fashioned and the reasoning by which he progresses from his material to his conclusion” ’ ”].)
We note that the trial court’s stated goal in applying the CLAM method was to achieve “substantial justice between the parties.” Jamie had a one-half interest in the fruits of Scott’s pre- separation efforts to found and develop MedVector. (See Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 8:336, p. 136.) Scott raised MedVector’s $474,500 in pre- separation capital by the end of 2018, when MedVector had no employees or independent contractors other than Scott. He testified that he “worked [his] tail off” to raise that capital, without which MedVector “never would have started” and “wouldn’t exist.” Anfuso agreed that without Scott’s pre- separation efforts, MedVector would have had zero pre- separation capital and would have gone out of business. Because Scott’s pre-separation efforts were critical to MedVector’s continued existence, without which his MedVector shares would lack even speculative future value, the trial court did not act arbitrarily in finding that justice was better served by apportioning to the community an interest of 12 percent rather than 1 percent (resulting in an award to Jamie of 6 percent rather than 0.5 percent).
2. The trial court did not err by assigning Jamie no MedVector-related debts. “[T]he community estate is liable for a debt incurred by either spouse before or during marriage . . . .” (§ 910, subd. (a).) “ ‘During marriage’ for purposes of this section does not include the period after the date of separation . . . and before a judgment of dissolution of marriage or legal separation of the parties.” (§ 910, subd. (b).) “Thus, debts incurred by either spouse after separation are the debtor spouse’s separate obligation, neither chargeable against nor reimbursable from the community estate.” (Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 8:746, p. 287, original italics; accord, Blizzard Energy, Inc. v. Schaefers (2021) 71 Cal.App.5th 832, 853.) “[A]ll separate debts . . . shall be confirmed without offset to the spouse who incurred the debt.” (§ 2625.)
Here, Scott testified that after separation, he personally guaranteed loans to MedVector and charges on a MedVector credit card. As his trial brief stated: “Since the parties’ separation, Scott has had to personally guarantee loans to keep MedVector afloat, including . . . credit card debts.” (Italics added.) Scott argues that the trial court abused its discretion by failing to assign Jamie any portion of those MedVector debts.
Scott, however, cites no authority suggesting that MedVector’s debts (i.e., debts incurred by a third party) were subject to division between Scott and Jamie merely because Scott personally guaranteed those debts. (See Fam. Code, § 910, subd. (a) [community estate is liable for certain debts incurred “by either spouse”]; Civ. Code, § 2787 [“A surety or guarantor is one who promises to answer for the debt, default, or miscarriage of
another, or hypothecates property as security therefor” (italics added)].)
Even assuming, arguendo, that Scott personally incurred debts by guaranteeing MedVector’s debts, the community is not liable for Scott’s MedVector-related debts because Scott incurred them after separation. (§ 910, subds. (a)-(b).) Anfuso implicitly recognized as much, testifying that whether Scott personally guaranteed any MedVector debt was irrelevant to the apportionment analysis, “especially if he did that after the parties’ date of separation . . . .”
Because Scott incurred his MedVector-related debts after separation, his reliance on section 2550 is misplaced. That statute generally requires a trial court to “divide the community estate of the parties equally.” (§ 2550, italics added.) As discussed, Scott’s post-separation debts are not chargeable against the community estate. (§ 910, subds. (a)-(b).) “[O]nce the court characterizes an unpaid liability as a ‘separate debt’ [citation], the debt does not factor into the equal division of the community estate.” (Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 8:1288, p. 476, italics omitted; accord, In re Marriage of Cairo (1988) 204 Cal.App.3d 1255, 1267.)
The trial court’s statement of decision noted that the court “heard testimony as to multiple loans secured by [Scott] to continue growing MedVector, post separation.” (Italics added.) The statement of decision did not expressly find that those loans were MedVector’s debts or Scott’s separate debts. Contrary to Scott’s suggestion, that omission was not reversible error. Although Scott’s trial brief requested, in passing, that the trial court assign Jamie a share of his (speculative) future responsibility for the MedVector debts that he personally
guaranteed, he did not contend in his trial brief or in closing arguments that he personally incurred those debts, much less that he did so before separation or that they were chargeable to Jamie’s interest in the community for any other reason. Thus, the characterization of those debts was not among the principal controverted issues that the statement of decision was required to address. (See Code Civ. Proc., § 632 [where properly requested, statement of decision must explain factual and legal basis for trial court’s decision “as to each of the principal controverted issues at trial”]; Yield Dynamics, Inc. v. TEA Systems Corp. (2007) 154 Cal.App.4th 547, 559 (Yield Dynamics) [“While we have found no existing definition of that phrase [principal controverted issues], it is settled that the trial court need not, in a statement of decision, ‘address all the legal and factual issues raised by the parties’ ”].)
Even assuming, arguendo, the trial court erred by failing to make an express finding regarding the characterization of the MedVector-related debts, the error was harmless because, for the reasons discussed above, the undisputed evidence compels a finding that they were MedVector’s debts or Scott’s separate debts. (See Pallco Enterprises, Inc. v. Beam (2005) 132 Cal.App.4th 1482, 1501 [omission of required finding from statement of decision is harmless error unless sufficient evidence supports finding in appellant’s favor].)
To the extent Scott suggests it is unfair for Jamie to receive equity in MedVector without bearing the risk of paying MedVector’s debts if the business fails, we disagree. Just like any other shareholder, Jamie need not assume personal responsibility for the business’s debts. If the business succeeds
and its shares acquire actual economic value, its debts will reduce that value as to all shares, including Jamie’s.
In short, we conclude that the trial court did not err by awarding Jamie a 6 percent interest in Scott’s MedVector shares or by assigning her no MedVector-related debts.
B. The trial court did not err by awarding Jamie $14,000 as a remedy for Scott’s sale of a motorcycle in breach of his fiduciary duty. “Each spouse shall act with respect to the other spouse in the management and control of the community assets and liabilities in accordance with the general rules governing fiduciary relationships which control the actions of persons having relationships of personal confidence as specified in Section 721, until such time as the assets and liabilities have been divided by the parties or by a court.” (§ 1100, subd. (e).) A spouse’s fiduciary duty carries an obligation, among others, of “[a]ccounting to the spouse, and holding as a trustee, any benefit or profit derived from any transaction by one spouse without the consent of the other spouse that concerns the community property.” (§ 721, subd. (b)(3).) The fiduciary duty also requires “accurate and complete disclosure of all assets and liabilities in which the [other] party has or may have an interest or obligation . . . , including an immediate, full, and accurate update or augmentation to the extent there have been material changes.” (§ 2102, subd. (a)(1).)
“Remedies for the breach of the fiduciary duty . . . when the breach falls within the ambit of Section 3294 of the Civil Code shall include, but not be limited to, an award to the other spouse of 100 percent, or an amount equal to 100 percent, of any asset undisclosed or transferred in breach of the fiduciary duty.” (Fam.
Code, § 1101, subd. (h).) Civil Code section 3294 provides: “In an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.”11 (Civ. Code, § 3294, subd. (a).)
Here, Scott sold a community property motorcycle for $14,000, without informing Jamie or obtaining her consent, and used the sale proceeds in purchasing another motorcycle. The trial court found that the sale breached Scott’s fiduciary duty and that the breach was within the ambit of Civil Code section 3294. Based on the $14,000 sale price, the trial court found that the motorcycle’s value was $14,000 and awarded Jamie 100 percent of that value as a remedy for the breach under Family Code section 1101, subdivision (h). We review the trial court’s factual findings for substantial evidence. (In re Marriage of Rossi (2001) 90 Cal.App.4th 34, 40 (Rossi).)
Scott argues that the trial court failed to make a required finding that he was guilty of oppression, fraud, or malice within the meaning of Civil Code section 3294. We disagree. The trial court expressly found that “Respondent’s breach of fiduciary duty to Petitioner, by his conduct of selling the Harley Davidson motorcycle to upgrade to a newer model, w[as] within the ‘ambit’ of Civil Code § 3294 . . . .” The trial court’s express language mirrored that of Family Code section 1101, subdivision (h), which
11 If the breach does not fall within the ambit of Civil Code
section 3294, remedies shall include an award of 50 percent, or an amount equal to 50 percent, of the asset. (Fam. Code, § 1101, subd. (g).)
authorizes an award of 100 percent of an asset transferred in breach of the fiduciary duty “when the breach falls within the ambit of Section 3294 of the Civil Code . . . .” Scott cites no authority—and we are aware of none—holding that such an express finding is insufficient to support an award under Family Code section 1101, subdivision (h).12 Scott argues that no substantial evidence supported a finding that he was guilty of oppression, fraud, or malice. Again, we disagree. “ ‘Fraud’ means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.” (Civ. Code, § 3294, subd. (c)(3).)
Scott does not challenge the sufficiency of the evidence supporting the trial court’s finding that Scott knowingly violated the ATRO prohibiting his sale of the motorcycle without Jamie’s written consent. After knowingly violating that order, Scott used the sale proceeds in buying another motorcycle, without transferring to Jamie or holding in trust her share of the proceeds. The trial court observed that Scott’s testimony and
12 In re Marriage of Gilbert-Valencia & McEachen (2023) 98
Cal.App.5th 520, 527, held that a trial court abused its discretion by making a 100 percent award of quasi-marital property under Family Code section 1101, subdivision (h), because the trial court “erroneously believed it could award 100 percent of the quasi- marital property . . . without finding oppression, fraud, or malice.” The opinion does not mention any express finding by the trial court that the breach of fiduciary duty fell within the ambit of Civil Code section 3294. “[C]ases are not authority for propositions not considered.” (Sonic-Calabasas A, Inc. v. Moreno (2013) 57 Cal.4th 1109, 1160.)
courtroom demeanor showed that he did not believe he needed Jamie’s consent for the sale (despite a court order to the contrary), and that Scott’s other litigation conduct reflected a pattern of disregard for the court’s orders and breaches of fiduciary duty.
We conclude that Scott’s undisputed conduct was substantial evidence that he was guilty of fraud because he intentionally concealed the motorcycle sale and the proceeds with the intent to deprive Jamie of property (her share of the proceeds) or legal rights (her rights under the ATRO). (See Civ. Code, § 3294, subd. (c)(3); Rossi, supra, 90 Cal.App.4th at pp. 40-42 [spouse’s intentional failure to disclose community property lottery winnings constituted fraud and supported 100 percent award under Family Code section 1101, subdivision (h)].)
Finally, Scott argues that no substantial evidence supports the trial court’s finding that the value of the motorcycle was $14,000. “The value of the asset shall be determined to be its highest value at the date of the breach of the fiduciary duty, the date of the sale or disposition of the asset, or the date of the award by the court.” (§ 1101, subd. (g).) Scott does not dispute that his testimony that he sold the motorcycle for $14,000 was substantial evidence that on the date of the breach (the sale), the motorcycle’s fair market value was $14,000.
Instead, Scott argues that the value awardable under section 1101, subdivision (h), was limited to the community equity created by Scott’s pre-separation payments on the note used to finance the original purchase of the motorcycle. He argues that the community had no interest in the equity he created by making payments on the note after separation.
Scott, however, produced no evidence that he made his post-separation payments with his separate funds rather than community funds (such as the $55,000 in community funds he improperly withdrew from the parties’ Raymond James investment and retirement accounts). Absent such evidence, Scott’s reliance on section 2640 is misplaced. (See § 2640, subd. (b) [“In the division of the community estate . . . , [a] party shall be reimbursed for the party’s contributions to the acquisition of property of the community property estate [including payments that reduce the principal of a loan used to finance the purchase of the property] to the extent the party traces the contributions to a separate property source” (italics added)].)
Moreover, because Scott’s breach of his fiduciary duty was the reason the motorcycle was removed from the community estate and the proceeds were used to pay the balance on the note without an accounting, he bore the burden to prove to what extent, if any, the motorcycle’s value was reduced by any outstanding community debt on the note. (See In re Marriage of Prentis-Margulis & Margulis (2011) 198 Cal.App.4th 1252, 1269 [“Family Code provisions detailing the fiduciary obligations between spouses provide strong support for shifting the burden of proof to the managing spouse when determining the value and disposition of missing assets”].) Scott testified that he did not recall (and could only guess) the amount of the outstanding balance on the note at the time he sold the motorcycle. Although he “guessed” what the balance was, his speculation could not satisfy his burden of proof. (Carter v. CB Richard Ellis, Inc. (2004) 122 Cal.App.4th 1313, 1328 [“ ‘inferences that are the result of mere speculation or conjecture cannot support a finding’ ”].) Because Scott failed to meet his burden to prove a
lesser value, we conclude that the undisputed $14,000 sale price was substantial evidence supporting the trial court’s finding that the motorcycle’s value was $14,000.
In sum, we conclude that the trial court did not err by awarding Jamie $14,000 as a remedy for Scott’s breach of fiduciary duty under section 1101, subdivision (h).
C. The trial court did not abuse its discretion by ordering Scott to pay Jamie’s attorney fees. Section 2030 authorizes an award of need-based attorney fees. “In a proceeding for dissolution of marriage, . . . the court shall ensure that each party has access to legal representation . . . by ordering, if necessary based on the income and needs assessments, one party . . . to pay to the other party, or to the other party’s attorney, whatever amount is reasonably necessary for attorney’s fees and for the cost of maintaining or defending the proceeding during the pendency of the proceeding.” (§ 2030, subd. (a)(1).) “When a request for attorney’s fees and costs is made, the court shall make findings on whether an award of attorney’s fees and costs under this section is appropriate, whether there is a disparity in access to funds to retain counsel, and whether one party is able to pay for legal representation of both parties. If the findings demonstrate disparity in access and ability to pay, the court shall make an order awarding attorney’s fees and costs.” (§ 2030, subd. (a)(2).) “The court may make an award of attorney’s fees and costs under Section 2030 . . . where the making of the award, and the amount of the award, are just and reasonable under the relative circumstances of the respective parties.” (§ 2032, subd. (a).)
Section 271 authorizes an award of attorney fees as sanctions. “Notwithstanding any other provision of this code, the
court may base an award of attorney’s fees and costs on the extent to which any conduct of each party or attorney furthers or frustrates the policy of the law to promote settlement of litigation and, where possible, to reduce the cost of litigation by encouraging cooperation between the parties and attorneys. An award of attorney’s fees and costs pursuant to this section is in the nature of a sanction.” (§ 271, subd. (a).) “In making an award pursuant to this section, the court shall take into consideration all evidence concerning the parties’ incomes, assets, and liabilities. The court shall not impose a sanction pursuant to this section that imposes an unreasonable financial burden on the party against whom the sanction is imposed.” (Ibid.)
Here, the trial court granted Jamie’s request for attorney fees under sections 2030 and 271 and ordered Scott to pay her remaining balance of $35,108 in fees. We review the attorney fee award for abuse of discretion. (In re Marriage of Rangell (2023) 95 Cal.App.5th 1206, 1218.) “Under this standard of review, the trial court’s order will be upheld on appeal unless, considering all the evidence viewed most favorably in support of the order and indulging all reasonable inferences in its favor, no judge could reasonably make the order.” (Ibid.) We review the trial court’s factual findings for substantial evidence. (Ibid.)
Scott argues that we should apply a less deferential standard of review because the trial court’s statement of decision was deficient as to the attorney fee award. We disagree. Indeed, “[a] trial court is not required to issue a statement of decision for an attorney fee award.” (In re Marriage of Falcone & Fyke (2012) 203 Cal.App.4th 964, 981 (Falcone).)
Scott challenges the attorney fee award on three grounds:
(1) the trial court failed to make required findings to support an
award of need-based fees under section 2030; (2) the trial court failed to make required findings to support an award of fees as sanctions under section 271; and (3) the trial court failed to allocate the amount of fees awarded between need-based fees and fees as sanctions. We address each issue in turn.
1. The trial court made adequate findings to support the award under section 2030. Scott argues that the trial court failed to make the findings required by section 2030, i.e., “whether an award of attorney’s fees and costs under this section is appropriate, whether there is a disparity in access to funds to retain counsel, and whether one party is able to pay for legal representation of both parties.” (§ 2030, subd. (a)(2).) We disagree. The trial court implicitly found that a fee award was appropriate and expressly found “that there is a disparity in access to funds and that Respondent has the ability to pay all of both parties[’] legal fees incurred in this case.”
Without citing the record, Scott argues that the trial court’s ability-to-pay finding was deficient because it was “conclusory” and contradicted by certain evidence. Scott’s stipulation that he received $21,182 in monthly income, however, was substantial evidence supporting the trial court’s finding that he could pay the $35,108 fee award. The trial court expressly relied on the evidence of Scott’s monthly income. Scott cites no authority—and we are aware of none—suggesting that section 2030 required the trial court to discuss the evidence in more detail, if at all. As noted, a statement of decision was not required for the attorney fee award. (Falcone, supra, 203 Cal.App.4th at p. 981.) Even assuming, arguendo, a statement of decision was required, the trial court was required “ ‘only to set out ultimate findings rather
than evidentiary ones.’ ” (Yield Dynamics, supra, 154 Cal.App.4th at p. 559.)
Finally, Scott argues that the trial court failed to make a required finding under section 2032, which provides that a trial court may award fees under section 2030 “where the making of the award, and the amount of the award, are just and reasonable under the relative circumstances of the respective parties.” (§ 2032, subd. (a).) Unlike section 2030, however, section 2032 does not require a trial court to “make findings.” (§ 2030, subd. (a)(2).) Scott does not dispute that the trial court considered whether the award was just and reasonable, which is all that section 2032 requires.
2. The trial court made adequate findings to support the award under section 271. Scott argues that the trial court failed to make required findings under section 271, which authorizes a trial court to base an attorney fee award on the extent to which a party’s conduct frustrates the policies of promoting settlement and reducing the cost of litigation, and which prohibits a trial court from imposing an unreasonable financial burden via such an award. (§ 271, subd. (a).) Like section 2032, however, section 271 does not require a trial court to make findings. (See ibid.)
In any event, as noted, the trial court expressly found that Scott had the ability to pay all of the parties’ attorney fees, thereby implicitly finding that the fee award did not impose an unreasonable financial burden on him. Further, the trial court expressly agreed with Jamie’s argument that Scott’s disregard for court orders led to further litigation, i.e., that his conduct frustrated the policies of promoting settlement and reducing the cost of litigation. Contrary to Scott’s assertion that the trial court
failed to identify specific acts of sanctionable conduct, the court expressly based its award of fees as sanctions on Scott’s conduct in (1) failing to pay court-ordered reimbursement for one-half of the children’s medical expenses; (2) failing to timely pay court- ordered attorney fees; (3) failing to pay support arrears; (4) violating the ATRO by withdrawing funds from the Raymond James investment account; (5) violating the ATRO again by withdrawing funds from the Raymond James retirement account; and (6) violating the ATRO a third time by selling the motorcycle.
Scott argues that section 271 required the trial court to find that his conduct caused Jamie to incur the $35,108 in attorney fees awarded. Case law is to the contrary. (Falcone, supra, 203 Cal.App.4th at p. 990 [“ ‘[A] sanctions award under [Family Code] section 271 need not “be limited to the cost to the other side resulting from the bad conduct” ’ ”]; Hogoboom & King, Cal. Practice Guide: Family Law, supra, ¶ 14:245, p. 95 [section 271 “does not require a direct correlation between the amount of the sanction imposed and expenses incurred in resisting the sanctionable conduct”]; see also In re Marriage of Feldman (2007) 153 Cal.App.4th 1470, 1480 [section 271 “does not require any actual injury”].)
Scott acknowledges that section 271 “does not require a direct dollar-for-dollar causal link between the offending conduct and specific attorney fees incurred.” Citing In re Marriage of Davenport (2011) 194 Cal.App.4th 1507, 1529-1531, he asserts that the amount of fees awarded under section 271 “must still be reasonably tied to the extent the conduct increased the burden of litigation or frustrated settlement, and the trial court must explain this connection.” In Davenport, the Court of Appeal affirmed an award under section 271 without addressing whether
the law required the trial court to explain any such connection. (Id. at pp. 1525-1536.) “[C]ases are not authority for propositions not considered.” (Sonic-Calabasas A, Inc. v. Moreno, supra, 57 Cal.4th at p. 1160.)
3. The trial court awarded the full amount of fees on two independently adequate grounds. Scott argues that the trial court erred by failing to allocate the $35,108 in attorney fees between need-based fees under section 2030 and fees as sanctions under section 271. His premise is that the $35,108 award was a “blended” award comprising an unspecified amount of need-based fees plus a separate, unspecified amount of fees as sanctions.
Scott identifies no support for that premise in the record.
In discussing need-based fees under section 2030, the trial court’s statement of decision found that Scott had the ability to pay “all” of the parties’ fees and that the fees incurred in the litigation (not merely some portion thereof) were reasonable. In discussing fees as sanctions under section 271, the trial court found that Scott’s pattern of disregard for court orders contributed to the award of $35,108, i.e., the full amount of the award.
Based on those findings, we read the trial court’s statement of decision as determining that each of section 2030 and section 271 was an independently adequate ground for awarding Jamie the full remaining balance of her fees ($35,108). Thus, the trial court had no occasion to allocate the fees between the two grounds.
In short, we conclude that the trial court did not abuse its discretion in awarding Jamie her attorney fees.
DISPOSITION
The judgment is affirmed. The parties shall bear their own costs on appeal.
NOT TO BE PUBLISHED
M. KIM, J.
We concur:
ROTHSCHILD, P. J.
BENDIX, J.
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