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Case of the Month (from CFLR Monthly)

December 2017
[Archive]

Oral statement of decision suffices where trial court declines to modify, terminate, or set aside support order . . .

 

In affirmance, Second District holds that trial court’s award to Mom of sole authority to make decisions re children’s orthodontic care is not a custody change where she and Dad still have joint legal custody of the kids; standard of review is kids’ best interests

 

In re Marriage of Furie

October 30, 2017)

California Court of Appeal 2 Civil B269972 (Div 1) 16 Cal.App.5th 816, 224 Cal.Rptr.3d 637, 2017 FA 1813, per Chaney, J (Rothschild, PJ and Johnson, J, concurring). Los Angeles County: Lopez-Giss, J, affirmed. For appellant: pro per. For respondent: Lisa Rosenthal, (818) 348-2896. CFLP §§G.26, G.133.1.2.

 

Kelly and Russell Furie were married in November 1996; their children K.F. and M.F. were born in 1998 and 2001 respectively. In August 2009, Kelly filed for divorce. Six months later, the trial court issued the parties stipulated judgment for a legal separation. That judgment awarded the parents joint legal custody of the kids, ordered Russell to maintain health insurance for them, and required him to pay child support of $1,454 per month, plus half of the kids’ school or child care costs and uninsured medical expenses. The judgment awarded the family home to Russell and required him to pay all debts related to it, but provided that Kelly and the kids could live in the house with Russell until M.F. turned 18. Kelly and Russell each waived spousal support, but the trial court retained jurisdiction over that issue. Along with other community assets, Russell was awarded KMF Investments Inc. and RKF Investments Inc.

 

Six months later, Russell bought a condo, moved out of the family home, and defaulted on the mortgage. In February 2011, Kelly sought an increase in Russell’s support obligations to cover the mortgage. In opposition, Russell contended that he and Kelly had agreed to modify the separation judgment to give KMF to her and relieve him of his mortgage obligation re the family home. At a hearing in March, the trial court ordered Russell to pay the outstanding mortgage payments by April 29 and to pay an additional $4,709 per month to cover the mortgage. Russell promptly moved for reconsideration, now contending that Kelly had unilaterally converted KMF assets to herself. Kelly shot back a request for sanctions. The trial court denied reconsideration and declined to order sanctions in an order issued June 24, 2011.

 

In July 2011, Russell created the Douglas Mae Trust and transferred his condo, RKF, and various other assets into the trust. Soon after, he sought an order to modify the stipulated judgment, making the same accusations regarding Kelly’s conversion of KMF assets and release of his mortgage obligations. In a separate motion, Russell sought custody and child support changes, but later withdrew his request. After a hearing on August 28, the trial court denied Russell’s motion to modify the judgment and continued the hearing re custody and support orders.

 

Meanwhile, Kelly asked the trial court to correct its earlier order to designate the $4,709 as child support, not spousal support. At a combined hearing on child custody, support, and Kelly’s request, Russell again raised the issue of Kelly’s alleged KMF conversion. The trial court then denied Kelly’s request and Russell’s request for a support mod, vacated the earlier order, recalculated Russell’s support obligation, and ordered him to pay child support of $2,136 per month, plus Kelly’s attorney’s fees as sanctions. After Russell again moved unsuccessfully for reconsideration, the trial court ordered him to pay further sanctions to her attorney. Russell appealed.

 

While his appeal was pending, Russell sold the assets of an RKF-owned business to his father. Kelly then filed a request for an order requiring Russell to give her the promissory note his father gave him re the sale, as partial payment of child support arrearages. In a statement of decision issued March 18, 2013, the trial court ordered Russell to turn over the promissory note to Kelly forthwith and to pay $1,000 to her attorney as sanctions for his litigation conduct.

 

On March 28, 2013, Russell filed for bankruptcy protection. Kelly then filed an adversary complaint claiming, among other things, that Russell fraudulently induced her to waive spousal support. On December 18, 2014, the bankruptcy court entered a non-dischargeable judgment for Kelly to the tune of $452,064 as damages for Russell’s fraud and determined that his support and attorneys’ fee obligations were non-dischargeable.

 

Meanwhile, in March 2014, the Second District, acting on Russell’s first appeal in an unpublished opinion, remanded for the trial court to reconsider its allocation of medical insurance expenses in calculating the child support order, but affirmed the orders made in March and May of 2012 re mortgage payments and child support. Russell then filed another motion for a child support reduction, again raising the issue of Kelly’s alleged KMF conversion. After a series of hearings, the parties agreed that Russell’s child support arrearages totaled $30,020 and the trial court ordered him to pay $250 per month toward those arrearages. At a hearing on January 2015, the lower court denied Russell’s request for a child support reduction.

 

In August 2015, Russell filed a request to have the trial court vacate or reconsider its March 18, 2013, statement of decision directing him to give the RKF promissory note to Kelly, and to have that court consider his allegation regarding Kelly’s conversion of KMF assets, all in an apparent attempt to reduce his child support and arrearages payments. In September, Kelly filed a request for sole legal custody of the kids, based on Russell’s “refusal to co-parent on orthodontic issues,” and for reimbursement of uninsured orthodontic expenses. On December 20, the trial court issued an order after hearing, declining to reconsider or vacate its March 2013 order or to adjust the arrearages amount that the parties had agreed on. The lower court found that Russell controlled the Douglas Mae Trust, ordered him to pay half of the kids’ uninsured orthodontic expenses, denied his request for a child support reduction, and gave Kelly sole authority over the kids’ orthodontic care.

 

Russell appealed, but the Second District affirmed.

 

No extra help for pro pers . . .
Before they addressed Russell’s first contention, the justices emphasized that he is not entitled to special consideration because he is a pro per litigant. That status, they said, does not relax the restrictions on either their discretion or the permissible scope of their review. That said, they turned to the question of whether the trial court erred by failing to issue his requested written statement of decision under CCP §632 and Fam C §3654. They noted that as Kelly averred, CCP §632 permits a trial court to issue an oral statement of decision. Russell argued, however, that Fam C §3654 requires the trial court to issue a written one, if requested. Focusing on the language in Fam C §3654, the panel found that it requires the trial court to issue a written statement of decision if a party requests one and the court has made an order modifying, terminating, or setting aside a support order. Here, the justices reasoned, the trial court had issued an oral statement of decision on the record with the parties present, as permitted by CCP §632. Moreover, the lower court had not made an order that modified, terminated, or set aside a support order as required by Fam C §3645. Therefore, the panel concluded, the trial court was not required to issue a written statement of decision.

 

Medically speaking . . .
Russell next contended that the trial court erred by ordering him to pay half of the kids’ orthodontic expenses. The panel didn’t agree. They pointed out that the parties’ stipulated judgment required Russell to be responsible for half of the kids’ medical expenses not covered by insurance. The justices noted that Kelly had testified about her efforts to find covered orthodontic care and had backed up her testimony with documentary evidence. Thus, there was sufficient evidence that the orthodontic expenses were not covered by insurance and that Russell was on the hook for half of them.

 

The justices have their standards . . .
Russell also argued that the lower court’s order giving Kelly full authority over the kids’ orthodontic care was an abuse of discretion because the order amounted to a custody change and Kelly had not shown changed circumstances that required the order. The justices explained that the order was not a custody change, but rather a change in the parties’ parenting arrangement, which does not require a showing of changed circumstances. The panel emphasized that the parents still shared joint legal custody of the kids; the only change was that Kelly had sole authority over the kids’ orthodontia. They saw no need to require a showing of changed circumstances where the lower court makes a change in the parenting authority that does not rise to the level of a custody change. Therefore, the panel held that the appropriate standard for ordering such a modification is the best interests of the child. Here, undergoing orthodontia was clearly in the best interest of the kids, and Russell had not objected to the trial court’s failure to state that standard at the hearing. Accordingly, the panel concluded that the trial court’s order was not an abuse of discretion.

 

Under control . . .
Russell further maintained that the lower court erred in finding that he controlled the assets of the Trust. In support of that, he argued that he could not have received a discharge in bankruptcy if he had such control. The justices, however, could find no factual or legal support for his contentions regarding the bankruptcy proceeding. Moreover, the record was devoid of information regarding that court’s reasoning or conclusions. The panel noted, however, that Prob C §15304 and §15305 permit the trial court to reach trust assets to pay Russell’s child support obligations. Thus, the court here hadn’t erred by doing so.

 

Enough, already . . .
Finally, Russell argued that the panel should order the lower court to conduct a hearing regarding Kelly’s alleged conversion of KMF or its assets. The justices pointed out that Russell “has exhaustively presented his KMF argument to the trial court in a variety of contexts,” all without success. They saw no need to rehash a contention that was repeatedly addressed and rejected by the trial court. Finding no merit in Russell’s other contentions, the panel affirmed the trial court’s orders.

 

 

Comment

  

The justices note that the issue of a changed parenting plan has usually arisen in the context of physical custody and visitation. In the leading case on this issue, In re Marriage of Birnbaum (1989) 211 Cal.App.3d 1508, 260 Cal.Rptr. 210, 1989 CFLR 4093, 1989 FA 385, the parents had joint legal and physical custody of their three daughters, but the girls had their primary residence with their mother during the school year, except for weekends and Wednesday afternoons. The rest of the time, one child’s primary residence was with the mother, one with the father, and the third alternated between the two. Not long after the agreement, the mother moved to the other end of the county and enrolled the two school-age girls in a new school. Three years later, however, each parent was unsatisfied with the arrangement and sought sole custody. Following psychological evaluations, the trial court, acting on the parents’ motions, ordered a new schedule for the girls to live at certain times with each parent. After moving unsuccessfully for reconsideration, the mother appealed, but the First District affirmed, holding that an order modifying a “co-parenting residential agreement” does not constitute a change of custody and cannot be reversed unless it is demonstrated that the trial court abused its “very broad discretion” and “exceeded the bounds of reason.” Moreover, the justices found, proof of changed circumstances is not necessary where there is just a “rearrangement of the children’s residential timetable.” The Fourth District followed the Birnbaum rule in Enrique M. v. Angelina V. (Enrique I) (2004) 121 Cal.App.4 th 1371, 18 Cal.Rptr.3d 306, in ruling on a father’s request for a modification of a parenting schedule. And, in In re Marriage of Lucio (2008) 161 Cal.App.4 th 1068, 74 Cal.Rptr.3d 803, the appellate court applied the rule to a parenting arrangement where one parent had sole physical custody.

 

 

The justices here have no problem expanding the rule to include an order that doesn’t change a parenting plan, but rather, changes the extent of parental authority outlined in a statutory provision. As they point out, Fam C §3003 provides that joint legal custody gives each parent the right and responsibility to make decisions regarding their children’s health, education, and welfare. The order here, which gives Kelly the sole authority over the kids’ orthodontic issues, also takes away Russell’s right to make those decisions. It’s a little more than simply rearranging a visitation plan. We can understand why the court would think that it is better to let Kelly make those decisions, given Russell’s apparent intransigence on the subject. Still, it may be one of those decisions that has unexpected consequences, if it opens the door to conflict over what constitutes a change in parenting arrangements in future cases.

 

 

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