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Recent Posts in Odd Court Decisions Category
| November 13, 2011 |
| Wife Bears Own ATTORNEY FEES In Failed SET ASIDE MOTION Involving MSA |
| Posted By Thurman Arnold, CFLS |
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Marriage of Guilardi (11/7/11) 200 Cal.App.4th 770
The Sixth District Appellate Court (including Santa Clara County) has upheld a trial court denial of recovery for the attorney fees incurred by and during a former wife's unsuccessful bid to set aside a Marital Settlement Agreement (MSA), based upon express language and implied waivers contained in that agreement (which became incorporated into the Judgment once it was approved by the court), and some misconduct on Wife's part.
Wife sought an award of $157,650 which she had paid (or that possibly remained unpaid) to her attorney, under the "needs" based provisions of Family Code section 2030, even though she incurred them on an underlying motion to set aside the MSA and Judgment that had been determined adversely to her. Her application was made on the basis of fraud, mistake, perjury and noncompliance with the Family Code disclosure requirements - which are standard grounds that
Family Code section 2122 enumerates for setting aside family law judgments. It appears from this decision, which is obtusely written at times, that Wife had waived spousal support in that agreement.
Her motion was filed one day before the one-year statute of limitations expired as to some of those grounds (i.e., mistake). When Wife signed the MSA she was not represented by counsel, and for "reasons known only to her" declined to consult with anyone despite being warned by language in the MSA that she might wish to do so and would be bound by it in any event. The MSA contained two standard provisions that the trial court seized upon in denying Wife recovery of any fees: a) a waiver of all claims under Evidence Code section 1542 and b) a clause that stated that in the event of further litigation arising from the agreement, the prevailing party would be entitled to recover their attorney fees and costs. It did not contain any express waivers of need based or other attorney fee claims, but the trial court implied this waiver from the language and intent of the document.
Unfortunately for Wife, also, the trial court found that she had intentionally destroyed a premarital agreement - although the decision is vague about how the prenup related to the MSA (apparently it too waived spousal support, but the trial court refused to uphold that waiver to the extent it arose in the premarital agreement) - and this fact may be useful to distinguish this decision from other cases, and their lines of reasoning that suggest some courts might reach a different result. (The decision recognizes this split of authority and briefly discusses these other cases). Reference to Wife's destruction of the prenup is also confusing because it was apparently nonetheless litigated so someone must have retained a copy.
So began three years of litigation, and ended after two more years of appellate processes. And lots of attorney fees for both sides.
I have mixed feelings about this decision. Sometimes bad facts make bad law. The decision doesn't tell us what burden of proof the trial court applied in finding a "waiver" of rights - whether by a preponderance of the evidence or by clear and convincing proof - and the additional fact of wife's destroying the Prenup, which the appellate decision repeatedly points out, makes this case muddy in terms of its potential application. I suspect that trial judges who wish to apply this case to fact patterns they see in their courtrooms may apply this holding without regard for similar bad acts in their own cases; in this sense, if indeed wife's destruction of the prenup sealed her fate, as the decision seems to imply, other people's fates may be similarly sealed in the future even in the absence of bad faith. And, is it good public policy to declare that a party who, in good faith, prosecutes a set aside motion should not recover fees if they ultimately lose? The two provisions in this MSA that the trial court relied are pretty much universal in MSA's and Stipulated Judgments for Dissolution and related marital or domestic partnership proceedings. Provisions that might be enforceable in most business or nonmarital contracts, particularly as they relate to power imbalances over the control of property or income that may be controlled by an "in-spouse", arguably should not apply within the family law context.
On the other hand, the fiduciary relationship arising under the fact of the marriage ("de facto" fiduciary relationship) ended when the parties separated and began their divorce battle. This is to be contrasted with the continuing legal obligations ("de jure" fiduciary duties) between the parties that don't end until the community property has been distributed. Additionally, there is a strong public policy interest in the finality of judgments - and this case, extending over 3 years at the trial court level, must have been expensive for the Husband. To have prevailed but still to have been required to pay $156,000 (or some other substantial amount) to Wife for her failed attack seems inherently unfair. This is especially so to the extent that she was destroying documents or otherwise defrauding him or the court. Moreover, Wife did sign the MSA and never apparently satisfactorily explained how this was not her own fault. While she was unrepresented at that time, she made that choice willingly.
Another unanswered question in the reported decision is whether Husband himself sought attorney fees against the Wife as the prevailing party; it seems not. Presumably this is because Wife signed away substantial rights to property and support when she executed the MSA, and so had little to give towards his attorney fees. Notably this was a lengthy 16 year marriage, and it produced a 10 year old daughter. We know nothing about Wife's education, background, or the parties' assets and income.
Incidentally, Wife complained for the first on appeal that the denying her a need's based attorney fee award per Family Code section 2030 was inappropriate given that issues of child custody and support were also determined in the MSA; she did not urge this point in the lower court. The appellate decision implies that such an argument, if properly made, could have caused a different result even if Mom still had lost the set aside application.
This is an important case for protecting the interests of parties once settlement agreements are executed and approved by family court judges. It is also one of those cases that parties who are resisting set aside motions will use to intimidate the other side. It is not at all clear from the decision what would happen where a party files a fee application to underwrite their set aside motion and sets it to be heard before the final determination, i.e., before the other side is determined to have "prevailed." But the implications seem clear. This case should not be considered the final word on the subject.
T.W. Arnold, III, CFLS |
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| March 14, 2011 |
| FAMILY LAW SANCTIONS and DUE PROCESS: Santa Barbara Trial Court Reversed in IRMO DURIS |
| Posted By Thurman Arnold, CFLS |
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Visitors to my websites know that I am biased in favor of mediation, believing that parties to litigation involving their family should opt to resolve their disputes themselves rather than undertake the perils of having a judge, or anyone else, decide their matters for them. This includes mediators (whose role is not to decide your issues for you but to facilitate you finding solutions). However, I admit that sometimes this doesn't seem possible. Too often one or both parties are reacting so deeply to their hurt or resentment and spinning with angry, busy minds that they perceive family court as the killing field for their unresolved conflict - a public forum for the spectacle of flogging the other side.
A recent reported decision illustrates the financial waste that occurs in high conflict family court battles, where there are no winners and only losers. My remarks are not intended to convince you to hire me, or to impugn judges whom I contend are struggling valiantly to protect children and mete out justice as best they can within a system that is not equipped to cope with the multi-dimensional challenges of emotional divorce and its aftermath: The trial judges are not broken, but the framework for government sponsored attempts to regulate the processes of divorce and domestic partnership dissolution is. Nor should it be read as an indictment of divorce lawyers or any particular barrister. An adversary model for resolving family disputes guarantees that the experience of everyone connected with these cases will be ... adversarial. Surprise!
In the meantime appellate justices are stepping forth to triage for the litigants, their attorneys, and the lower courts. But is it realistic to expect lawyers (in that small relative percentage of domestic cases where people can afford them) or judges to not be swept into the reactive thinking that the parties' disputes are personifying? I say "no". Our brains are hard-wired to respond to conflict in predictable ways. While we all ought to conduct our affairs in increasingly enlightened and ethical ways, and lawyers and judges surely benefit by incorporating the wisdom of the mental health sciences, a legal and cultural framework grounded in adversarial processes can never escape them. How could it be otherwise?
Marriage of Duris & Urbany
On March 14, 2011, the Second Appellate District (Division Six) reversed Santa Barbara trial judge Colleen K. Sterne's decision to discipline a self-represented litigant (an unemployed attorney) for, among other things, her earlier attorney's tactics in filing a motion to compel document production evidently without first attempting to resolve the disagreement informally. Discovery motions generate large fees and consume valuable judicial resources.
At the end of the hearing on Wife's original requests (the custody and support modification request she'd filed eight months earlier), the trial court imposed $10,000 in attorney fee sanctions against the Wife. Husband's attorney had evidently suggested that the Court do this somewhere in his Reply paperwork, and reiterated the request in his closing argument. The trial court took the bait. Its ruling was found to be an abuse of discretion.
According to the Husband, by the time of the hearing on original OSC to modify custody and support he had spent $25,000 for fees. Wife probably spent a similar but slightly lesser amount since she was in pro per for many months. Their fees and costs for the appeal probably were $20,000 more apiece (but Mr. Urbany handled his own appeal). Husband will get none of his money back, and Wife will recover only a portion of hers. Neither will achieve an emotionally satisfying resolution and their matter likely obsessed their lives over the year and a half. This case is "a pox on both your houses."
Wife's former attorney, Jacqueline Misho, was hired some six months into the proceedings, initiated when the Wife filed a motion for "100% physical and legal custody" of the parties' two children, plus more child support. Attorney Misho took an aggressive stance in advancing her client's claims and filed a discovery motion to compel production of documents. This was unsuccessful. The attorney was then let go. A week later the Wife's custody motion was heard. Although sanctions against her had not been requested by way of a noticed motion (possibly because there was little time in which to file one), Husband urged that she should pay his attorney fees. At hearing end when Judge Sterne announced her intent to hit Wife with $10,000 in sanctions as a share of the Husband's costs in part based upon the prior discovery motion filed by Misho, Wife complained "How am I being penalized for hiring [Misho]? How was I supposed to know? I thought she was the best there was." In my experience, "the best there [is]" often means the meanest and toughest. Many family law attorneys advertise themselves in such a fashion.
I have no personal knowledge about either party's attorney beyond what Google searches of their names retrieve and what a review of the California State Bar website discloses. Both are reputed to be tenacious divorce litigators. The problem with vociferous advocacy, irrespective whether it occurred in this case or not, is that it tends to generate a story of its own and so to increase the conflict noise volume - I confess I know this from my own past personal experiences. It can infect the process - there is something of a reciprocal feedback loop that occurs between high conflict litigants and their attorneys that is difficult to resist. Sometimes it seems to be the only choice, but usually that justification is borne of the tensions within the conflict itself and is not necessarily true.
Family law litigation becomes particularly nasty when attorneys for each side compete to inflame the trial judge with sound bite characterizations about the other. Some clients demand this from their counsel or become quite perturbed if their advocate doesn't respond in kind to these sorts of attacks. Lawyers who are being paid large sums are pressured to speak their client's minds (read: resentments) or risk a loss of confidence by their client. Of greater concern to the integrity of the legal professional generally, there are many family law attorneys whose entire strategy is geared around slandering the other litigant (or their attorney), often by exaggerating or misrepresenting the facts or history of the case solely as a means of confusing the judge or just plain pissing the court off in the hope of creating a favorable bias. Tit for tat then threatens to overwhelm the process. This sort of behavior can include ignoring the procedural rules for raising the issues to be decided, which is a form of ambush that can be effective exactly because the answering party is unable respond to an oncoming train if there is no forewarning.
I am not saying that this was either attorney's conduct in Duris as I lack sufficient details to make a full assessment; instead I am pointing out that adversary litigation programs lawyers and unrepresented parties to use whatever tactics that might work, and sometimes to try them all. This seems to be viewed as not only within the standard of care for zealous advocacy but to be required by that standard. I can comment that one irony of this case is that while the Wife's attorney allegedly failed to act in a cooperative manner in choosing to file a motion to compel without first attempting to solve the argument informally, Husband's attorney seized upon that misstep to buttress a request for sanctions that was never properly placed before the court. Sometimes these sound bites do stick; they did here, at least with Judge Sterne. Unfortunately, under these rules of engagement lawyers are thus encouraged to act as badly as the talking heads we see arguing on many 'news' programs, something that the American public views as a form of 'entertainment.'
This is one of the many dangers of adversarial litigation. Both sides feel righteously indignant, and attorneys tend to internalize their client's upset so that the boundaries between the client's experience and the attorney's own blurs. It is a recipe for disaster, but understandable given that emotional and angry ex-spouse pressure-cookers are letting out steam on both sides of the table all at once.
The appellate court's decision doesn't give us sufficient facts to discern whether the mother's initial application was well-merited, but Judge Sterne's decision suggests she did not view mom's motives (or her attorney's decision-making) to be in good faith. Wife's request for 100% custody looks to be retaliatory and frankly when this is true - and too often it is, even if not here (Judge Sterne referred to Wife's prior discovery motion as a "fee sink") - trial courts need to discourage such conduct in strong ways, especially when it generates unnecessary fees for the other party or damages children. Some people only respond to monetary slaps. I can merely speculate about these proceedings without reviewing the trial briefs and reporter's transcripts, and emphasize that reading 'between the lines' cannot give the whole picture.
Still this is a published decision of the 2nd Appellate District. Following on the heals of Marriage of Fong released for publication on March 3, 2011, these decisions, along with
Marriage of Tharp, should be read together to glean the larger message. Reviewing courts are holding everyone accountable - litigants, attorneys, and bench officers. Due process and fundamental fairness require every side to cross their own t's and dot their own i's. This is welcome instruction to the entire spectrum of family court members and participants.
Be Careful What You Ask For,
and Consider Asking for Something Different
However inappropriate Ms. Duris' conduct may have been (if at all), the appellate justices ruled that due process required that she be informed in advance that the court was considering sanctions in order to have an opportunity to muster and present evidence in opposition. Husband's request for relief should have been properly placed before the Court and not have been based upon offhand arguments buried somewhere in his reply pleadings or first presented in closing argument. This is a good thing. Last year's Elkins legislation spotlights the public policy goal of ensuring transparency for self-represented and represented family law contestants alike.
Now, eighteen months later the odyssey is not yet ended - the Sterne decision is sent back to the trial court (not likely to be Judge Sterne, who can be disqualified as the judge on the next go-round) "with instructions to conduct a new hearing with proper notice." In other words, to relitigate whether sanctions should be assessed against the Wife.
In the meantime, she is awarded her costs on appeal. No appellate case costs only $10,000, the amount in controversy that led to this appeal. Hence, Husband - who won a short-lived victory at the trial court level - will now likely end up footing not only the bill for his trial attorney, but the Wife's attorney fees on appeal as well (be careful what your attorney asks for!) The saga can be now rebooted. Might it end differently this go-around? I'd wager (and I hope) the parties have had enough and that will agree that Wife will forego her appellate costs while Husband will waive a second sanction's motion. But divorce trance is stubborn stuff.
There are only losers in Marriage of Duris. The children of these two warring parents seem utterly forgotten. The take away is that using California court judges to beat up the person you now find despicable (who then smacks back) may blow up in the face of each contestant; given that people often view justice from the lens of their own desires it is a small wonder that government regulated divorce hasn't found a way to respond to such expectations, and possibly never will until the entire system is jettisoned and recreated.
In the meantime try a different tact, if you wish it and if you can. Work together to resolve your disputes collaboratively or through mediation. Even if the other side seems incorrigible, you determine how you respond. Remember, litigation induces trance - seek equanimity and send your kids to college instead!
Here is a link to Marriage of Duris & Urbany.
Thurman W. Arnold, III, CFLS
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| September 18, 2009 |
| Idaho Trial Court Rules that Mother Cannot Move to Michigan, Even Without the Kids! |
| Posted By Thurman Arnold |
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I just have to blog this news from Idaho to reinforce why clients are so often better off resolving their disputes then asking judges - who mean well - to decide for them.
In Allbright v. Allbright the parties divorced and entered into a stipulation requiring 60 days notice before either moved out of Bannock County, Idaho, if it rendered the parenting plan impractical. Mother remarried, and 2 years later her new husband lost his employment. He was only able to find employment in Michigan. Mother gave notice of her intent to move to Michigan. At that time she had custody of the parties' minor daughter 54% of the time. Father responded with a motion to give him custody. The parties sought recommendations from a psychologist, who conducted a custody evaluation and recommended daughter be allowed to move to Michigan with mother. He recommended a custody manager because of the "considerable hostility" between the parents. Father wasn't happy and convinced the trial court to appoint a second custody evaluator, who recommended that Father retain custody if Mother moved.
The case was tried in the summer of 2008. At its conclusion, the court asked the parties' attorneys to brief whether it had the power to order Mother not to move at all, whether with or without the daughter.
Father urged that that child's best interests were (and would always be) best served if the parents remained in the same vicinity so that joint parenting could be shared. His lawyer argued that the child's best interests trumped every other consideration or right, such that a trial court could even, for example, order divorced and warring parents to live next door to each other or in the same house if it determined that was in the child's best interests!
The trial court evidently agreed, and ordered that Mom must not move out of Idaho whether with or without the daughter. Mother was hence enjoined to become a prisoner within that state, while her new husband continued his life in Michigan.
Thankfully, the Idaho Supreme Court disagreed with the trial court, but only after Mom probably spent thousands in legal fees defending her right to move. The high Court ruled: "A court presiding over a child custody matter does not become a family czar with unlimited authority to order the parents to do anything that the court believes is in the best interests of the child."
Yet, upon Mother's request to be reimbursed for her legal expenses, the Idaho Supreme Court was unsympathetic declaring that "[b]ecause we have never before addressed the issue of whether a court has the authority to prevent a parent from relocating, we do not find that Father defended this appeal frivolously, unreasonably, or without foundation."
My comment: It is always a dangerous matter to fail to resolve matters collaboratively.
Here is a link to the Idaho Supreme Court's decision in Allbright v. Allbright.
TWA
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