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Recent Posts in Set Aside of Judgments and Orders Category
| September 08, 2010 |
| What do I do if my spouse or domestic partner does not complete their DECLARATION OF DISCLOSURE? |
| Posted By Thurman Arnold |
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Q. What do I do if the other party to a divorce or dissolution of domestic partnership proceeding refuses to file their Preliminary Declaration of Disclosure?
A. Declarations of Disclosure must be exchanged in all California proceedings for dissolution of marriage or domestic partnership, for legal separations, and for annulments. They do not need to be served in any other form of family law proceeding.
There are two forms of Declarations of Disclosure: Preliminary Declarations of Disclosure (PDD's) and Final Declarations of Disclosure (FDD's). PDD's are governed by Family Code section 2103 and FC section 2104. FDD's are governed by Family Code section 2105. While parties to a dissolution or legal separation action can waive the exchange of the FDD in writing (although it is not a good idea to do so for reasons discussed in my blogs about fiduciary duties), they cannot waive exchanging the Preliminary Declarations with one exception: Where a dissolution or legal separation judgment is obtained by default, the defaulting party need not provide the PDD to the other party. Family Code section 2110.
Note that I used the words "exchange" and "serve." This is because the forms themselves are not required to be filed with the Court itself - instead, the proof of service upon the other party to the proceeding is what is to be filed. Judicial Council Form FL-141 is what you file with the clerk's office. In practice many people do file the actual schedules with the clerk, which can be a good idea because whether these forms were really exchanged and their contents can have a big impact on future set aside motions.
Here is the California Judicial Council Form FL-140 cover sheet that accompanies the PDD or the FDD. As you can see, it is the same form but different boxes are checked for each. A form FL-150 Income and Expense Declaration must accompany both, in addition to the FL-142 Schedule of Assets and Debts and the FL-160 Property Declaration.
The FDD is supposed to have much more detailed information, including supporting attachments, then is expected in the PDD.
Where the proceedings do not conclude by way of a default Judgment, the problem you have where the other party fails or refuses to exchange at least their PDD and thereupon to file the FL-141 proof of service is that the clerk cannot (a) set the matter for trial or (b) cannot accept for submittal to a judge and later filing a Stipulated Judgment or Marital Termination Agreement. This can make it impossible to conclude a case even by way of settlement where both parties are in perfect agreement, or to obtain a trial date where they are not. One party can hold up the entire process, and it is true that this often happens intentionally.
There is no set time for when parties must complete and exchange their preliminary declarations. Family Code section 2104 states in part that "after or concurrently with service of the petition for dissolution or nullity of marriage or legal separation of the parties, each party shall serve on the other party a preliminary declaration of disclosure...." The problem with this language is the word "after." The expectation is that this will be done within a reasonable time not usually exceeding 60 days from the date a party appears in the action by filing a Petition or a Response, but the statute does not explicitly say that.
The only remedy you have is file a notice of motion (or OSC application) pursuant to Family Code section 2107 asking that the court order the other party to serve their PDD and file the proof of service within a given number of days, not usually exceeding thirty. That motion should request an order that the other party's Petition or Response be stricken if they then fail to do so in a timely manner, so that your matter may effectively proceed by default hearing.
Expect the Court to give the other side one or two opportunities to get themselves into compliance with their fiduciary obligations to provide this exchange.
Thurman W. Arnold III
http://www.DesertDivorceandFamilyLawyer.com
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| May 12, 2010 |
| Is there any way to request that the Judge RECONSIDER her rulings in my case? |
| Posted By Thurman Arnold |
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Q. I was in Court three days ago and the Judge ordered me to pay an amount in support that there is no way I can afford. The Judge averaged my earnings over the past 12 months, and then entered that information into the Dissomaster. She then told me how much I had to pay for child and spousal support. The problem is that my hours were drastically cut back by my employer 10 days before the hearing and what I have been earning is not what I will be earning. I was so nervous in the courtroom I didn't explain this change to the Judge. Is there anything I can do to get the Judge to reconsider this order?
A. There are two important procedures that you can use to try to get a rehearing or a reconsideration of a court's award or decision, a motion for reconsideration and an application for CCP § 473 relief. Each is tricky and they do not succeed too often. I know of no statistics, but my guess is that court's will reconsider and reverse or modify their earlier decisions less than 10% of the time. 473 relief is more commonly granted.
The first is called a Motion for Reconsideration. The California statute governing reconsideration motions is California Code of Civil Procedure section 1008. It has at least two important parts: a) it must be timely filed and b) it must be based upon new or different facts,
circumstances, or law than what was known or shown at the time the hearing took place.
The threshold requirement is timing: § 1008(a) states that the motion must be filed "within 10 days after service upon the party of written notice of entry of the order." Courts consider that the failure to timely file a motion to reconsider is jurisdictional - which means they don't have the power to even consider your request if you are too late.
A literal reading of this statute suggests that the 10 day clock doesn't start ticking until you receive a hard copy of the court's order or ruling (typically through the mail or sometimes by personal service), but this is generally not how judges view it. Typically a judge announces their decision in open court. In the case of a Dissomaster or other support calculation they may print it out and give each party or the attorney for each party a copy. A minute order will be written by the court clerk, and placed in the file. It usually goes out in the mail to both sides the same day.
Sometimes a party or attorney will be directed by the Court to prepare a formal order. That formal order is usually on a Judicial Council form. The losing side is customarily asked to review and approve it before it is submitted to the judge for signature, except that many courts do not require an attorney to get the approval of an unrepresented party first and so it may wind up just being prepared and approved by the drafting attorney alone. Once the order after hearing gets signed by the court, it is supposed to be served upon the other party but often through sloppy practices or oversight it is not.
What this means is that you cannot rely on written notice as triggering your obligation to get the reconsideration motion filed - and you definitely cannot sit back and think that your time is not running just because no written order has been received by you.
Where the Judge makes their ruling while you are present in court, in my experience, most courts start the time running from the date of hearing regardless whether written notice or a formal written order is to follow. An exception is where a judge takes the matter "under submission" and makes her decision later, when a decision or ruling is mailed.
Many judges believe you have been "served" with the decision when you hear it - and therefore that your time to file a motion for reconsideration begins to run from that moment. This means that the only safe practice is to file your reconsideration motion no later than 10 calendar days after the hearing (not counting the first day, and if the 10th day falls on a weekend or holiday, your time is extended to the next calendar day).
10 days is not a lot of time to put a Motion for Reconsideration together. It needs to include a Notice of Motion form, an application form which includes your detailed declaration, and it is a good idea to provide legal authorities.
Assuming you meet the deadline you will find that Judges don't like to be asked to reconsider their decisions except for really good reason, and do not appreciate parties that simply are unhappy with the outcome and want to take another shot at it. They apply the technical rules technically to avoid changing their rulings, which makes some sense in terms of court efficiency because in litigation one side is almost always unhappy with the outcome and would like to reargue the matter.
The second half of a motion for reconsideration requires you establish that you have discovered "new or different facts or law." The "new law" situation is rare and does not mean that you just discovered that you quoted the wrong legal authorities to the Court and so now have "new" ones to present; it is intended to cover situations where the law changes or is clarified by statute or case decision in a way that would caused the Court to make a different decision.
Another important ground for reconsideration motions is the Court's inherent power "to do equity" or correct its own mistakes.
These motions are complicated and this Blog is just to give you some familiarity with them. These are the points I want to leave you with at the moment:
- If you can, try to research CCP § 1008, including looking at some legal treatise or the reported appellate decisions that mention it
- New or different facts don't generally include things you forgot to mention, unless you have some really credible explanation of why you forgot
- You must explain to the Court what you learned, how and when you learned it, why you didn't learn it earlier, and why these new or different facts matter enough that the Court should render a different outcome. If the other party withheld facts that you became aware of only after the hearing, you need to describe your reasonable diligence in having attempted to first get all the facts
- New facts are not the same as different facts. Be specific
- Telling the judge you just think she was wrong is rarely helpful - judges know they will be wrong some of the time, and they are trained as much to just make a decision as to get it right (clearly they want to get it right). Most of us don't like being told we are wrong and that is rarely a useful persuasive tool. Instead, focus on the justice or injustice of the situation and be humble
- Explaining that you made a mistake without more is also risky, because lawyers and parties do make mistakes in presenting their cases but the law favors finality in decision-making. Your mistake needs to have been a reasonable one.
- Always consider combining your reconsideration request with a request for relief under Code of Civil Procedure § 473, which is a very important statute that covers relief from orders or judgments that result from your inadvertence, surprise, mistake, or reasonable neglect
In your situation the question will be: If you knew 10 days before the hearing that your time had been cut back, why didn't you mention it? If you did mention it, then the Court considered your evidence and ruled against you, so this would not be new information.
Also, how different would the outcome have been if the Court had considered or known of the cut backs in your work? For instance, if those cut backs are partial and your income is 15% less than the Court supposed, this may not seem so important to the Judge that she thinks she needs to correct the unfairness of the result. If it is 40% less, she might. There are no hard and fast rules that can be applied with consistency.
It is quite common for clients to wind up hiring attorneys after they attempted to handle their case on their own, and it blew up at the hearing, and now they need desperately to get more or better information in front of the judge. It is very difficult to "unring the bell."
When these things happen they are a good lesson of why the adversarial court process is to be avoided whenever possible, and of the importance of finding and listening to a competent lawyer early on in your case.
Thurman W. Arnold
http://www.ThurmanArnold.com
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| January 17, 2010 |
| What are interspousal FIDUCIARY DUTIES? |
| Posted By Thurman Arnold |
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Q. I keep hearing the phrase "interspousal fiduciary duties". What does it mean?
A. Few areas of California divorce and family law is changing as rapidly, or is having as great an impact upon property division and support obligations, as is interspousal fiduciary duties.
Until the mid-1970s lesser "good faith" standards were imposed upon married persons which had consequences to usually only in extreme situations of self-dealing by one spouse. These standards have since morphed into much higher level "confidential duty" and "fiduciary duty" standards.
On January 1, 1994 Family Code section 721 became operative. That was revolutionary, but widely not understand, for the next 10 years. Section 721 has since been revised, extended, and expanded by statutory amendments and judicial decisions, and this continues.
The penalties for violating a fiduciary duty can be severe. Many attorneys, and some judges, are behind the curve in understanding the nuances of the obligations imposed by FC section 721 and related statutes. This ignorance places clients at financial risk in the course of dissolution or legal separation litigation. Indeed, it opens the door to the litigation continuing or re-emerging long after Judgment if breaches of fiduciary duty are discovered or alleged downstream. Having a lawyer who understands this developing area of the law will make or break some litigants, today and for years to come.
Fiduciary duty rules help to balance economic power in marriage and divorce. One reason people roll our eyes when the topic of "divorce" comes up is who doesn't know someone who out cheated, or got cheated by the other spouse, in matters of support or property division? There are lawyers who pander to clients who want to cheat their spouse or domestic partner. Americans share a cultural mythology that these attorneys charge the highest fees and if they can out-cheat the other spouse and their attorney, they deserve them.
The accountability that the law of fiduciary duties add to the dissolution mix is a useful tool for combating marriage fraud by the other spouse. If society favors the party with more money or power over the weaker party, it will become increasingly unglued.
Fiduciary Duties Described
In financial and property transactions with third parties and each other, spouses owe one another important statutory duties that create huge responsibilities and pitfalls. As between themselves, a husband and wife are subject to the general rules governing fiduciary relationships which control the actions of persons occupying confidential relations with each other. "This confidential relationship imposes a duty of the highest good faith and fair dealing on each spouse, and neither shall take any unfair advantage of the other." Family Code section 721(b).
The essence of the "fiduciary relationship" is that the parties are treated under the law as though they do not deal with each other on equal terms because one person (typically the managing spouse) in whom trust and confidence is reposed and who accepts the trust and confidence is in a superior position to exert influence over the dependent party. A presumption of undue influence arises whenever either party benefits from the transaction over the other, however innocuous the circumstances may seem. Breach of fiduciary duty is to some extent a strict liability offense, meaning if it occurs consequences may be set in motion that run the course to an expensive end.
In 2002 Family Code section 721 was amended to expand this confidential fiduciary relationship and impose the same rights and duties as applies to nonmarital business partners under the California Corporations Code, and includes but is not limited to:
(1) Providing each spouse access at all times to any books kept regarding a transaction for the purposes of inspection and copying;
(2) Rendering upon request true and full information of all things affecting any transaction which concerns the community property.
(3) Accounting to the spouse, and holding as trustee, any benefit or profit derived from any transaction by one spouse without the consent of the other spouse which concerns the community property (i.e., all property acquired by a married person during the marriage).
While Section 721 does not mention Registered Domestic Partners, it applies to them as well.
One major consequence is that transactions which benefit only one spouse may be set aside by the other, either before or during a divorce proceedings.
As a practical matter for divorcing couples, this means:
a) If one party has benefited over the other in a transaction involving money or property and thereby gained an advantage during the course of the marriage, the law presumes the advantage was gained through undue influence exerted on the part of the benefited party, and the transaction is presumed invalid and can be set-aside;
b) The burden of convincing a Court that a set-aside should not occur then shifts to the advantaged spouse;
c) All this can occur without regard to good or bad intent on the part of the advantaged spouse (i.e., actually intending to defraud as opposed to merely being sloppy). Either way the law declares the transaction to be the result of "constructive fraud". Once the Court finds constructive fraud the transactions can be set aside, the benefited party can be ordered to pay restitution to the other and to disgorge any profits they alone received, title may be reformed to include both parties' names, or the property may be held in trust for both on a present and go-forward basis rather than in the name of the one alone. If there is an actual fraudulent intent, the remedies to the injured spouse are more severe.
The fact that parties have separated or that a dissolution or legal separation is pending does not end the parties' fiduciary responsibilities. Family Code section 1100(e) continues those same duties "until such time as the assets and liabilities have been divided by the parties or by a court."
Remedies for breach of the fiduciary duty as described in Family Code section 721, and section 1100, include an amount equal to one-half of the value of any asset undisclosed or transferred in breach of fiduciary duty, plus attorneys fees. This includes inadvertent or unintentional violations. Family Code section 1101(g). Where a court comes to believe a spouse acted intentionally to defraud the other spouse, the Court "shall" award 100% of the value of what should have been disclosed, or what should not have been transferred, to the innocent spouse! FC section 1101(h).
If you have a business, or investments in real estate or simply a family residence, and certain transactions have occurred, you may have a problem. If you are a dependent spouse, regardless whether the other party intended to cheat you, you may have important entitlements and remedies.
This is one of the most complicated, emerging areas of California family law. Do not go it alone! In every dissolution and legal separation case, regardless whether either party has an attorney, each party must exchange a Preliminary Declaration of Disclosure, and unless expressly waived, a Final Declaration of Disclosure. If these documents contain errors, misinformation, or are incomplete the consequences can be financially devastating because an entire settlement or judgment may later be set aside. These documents sit as leverage tools and landmines for years to come.
TWA
http://www.ThurmanArnold.com
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