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Case of the Month (from CFLR Monthly)

May 2018
[Archive]

No show, no dough . . .

 

In reversal, Second District holds that wife’s I&E declaration was inadmissible hearsay in hearing where she had filed no response and was not present to be cross-examined; trial court abused its discretion by failing to terminate spousal support and basing its order for reduced support on wife’s I&E

 

In re Marriage of Swain

(March 26, 2018)

California Court of Appeal 2 Civil B284468 (Div 2) 21 Cal.App.5 th 830, 230 Cal.Rptr.3d 614, 2018 FA 1832, per Lui, PJ (Ashmann-Gerst and Chavez, JJ, concurring). Los Angeles County: Nord, Commissioner, reversed. For appellant: John Bigler, CFLS, (661) 947-8499. For respondent: no appearance. CFLP §P.69.15.

 

Leon and Sandra Swain were married in July 1994 and separated in October 2005. On February 13, 2007, the trial court filed their stipulated disso judgment which provided, among other things, that Leon would pay Sandra spousal support of $2,600 per month and that she expected to be self-supporting by January 2008. If she was not, the judgment provided that the trial court could attribute $2,500 a month to her as her earning ability.

 

Leon filed unsuccessful motions to modify or terminate spousal support in 2008 and 2009. On December 30, 2016, he filed another RFO, seeking to terminate spousal support. In his supporting declaration, Leon stated that he was retiring and that Sandra would begin receiving her share of his retirement benefits in an amount “close to the amount of spousal support” he was now paying. Sandra was served on May 2, 2017, but did not file a response or make an appearance at the hearing on Leon’s request. The trial court then continued the hearing to June 13, 2017, and ordered the parties to file I&E declarations at least 10 days before that date. Sandra did so, but filed nothing else.

 

At the hearing, Leon’s attorney objected to Sandra’s I&E declaration because she was not present to be cross-examined as to its content and had not asked that it be put into evidence. The trial court responded “‘Okay. All right.’” The court then accepted a letter from CalPERS, stating that Sandra’s monthly payments from Leon’s retirement benefits were $2,630 a month, effective December 31, 2016. Leon testified about the various physical ailments that detrimentally affected his ability to do his job and made him decide to retire at age 56. His attorney then asked the trial court if Sandra’s I&E would be received as evidence. The court replied that the I&E was filed, but “‘I wasn’t going to look at it.’”

 

On June 14, 2017, the trial court issued a statement of decision in which it found that Leon’s retirement was voluntary, that his medical issues did not affect his ability to earn, and that his retirement was insignificant “in light of the marital standard of living.” Leon’s income during the marriage had been $12,570 a month, and it would be $11,354 per month after he retired. In addition, his new spouse brought home $16,000 a month, which presumably was available to defer some of their living expenses. The lower court also found that Leon had shown a material change of circumstances in Sandra’s income, since she would be receiving her share of his retirement benefits. It pegged her monthly income at $5,130 a month, consisting of her $2,630 from retirement benefits and $2,500 of imputed income per the disso judgment. After considering the appropriate Fam C §4320 factors, the trial court looked to Sandra’s I&E declaration to determine her need for support, noting that it was executed under penalty of perjury and could “‘be considered testimony’” but its weight would be limited due to Sandra’s unavailability for cross-examination. The court then reduced Leon’s spousal support payments to $750 a month, but declined to terminate spousal support.

 

Leon appealed, and the Second District reversed.

 

A lot of this about that . . .
Leon contended that Fam C §217 precluded the trial court from considering Sandra’s I&E declaration because it was inadmissible hearsay. That statute provides that in any OSC or notice of motion hearing, the trial court shall receive any relevant, live, competent testimony within the scope of the hearing, absent a stipulation by the parties or a good cause finding by the trial court. The justices found that the statute did not address the inadmissibility of written testimony, only the admissibility of oral testimony. Therefore, they looked for guidance in the legislative history of the statute. They noted that it derived from a recommendation of the Elkins Family Law Task Force, and enacted in language “almost verbatim” to the recommendation. The justices thought it was reasonable to conclude that the Legislature “intended to abrogate the distinction the [California Supreme] Court made in Elkins” (Elkins v. Superior Court (Elkins) (2007) 41 Cal.4 th 1337, 63 Cal.Rptr.3d 483, 2007 CFLR 10697, 2007 FA 1304 between disso trials and family law motions that do not result in a judgment for the purposes of the hearsay rule. The panel found that in cases such as In re Marriage of Shimkus (2016) 244 Cal.App.4 th 1262, 198 Cal.Rptr.3d 799, courts have considered “the effect of section 217 on the holding in Elkins” but have not decided how the statute applies to the evidentiary rules in postjudgment proceedings, or more specifically, whether it completely abrogated the hearsay exception in CCP §2009 for substantive family law motions. In Shimkus , the court had held that the trial court need not have considered the declaration that the wife filed in opposition to the husband’s motion to terminate spousal support because she had never moved to admit the declaration as an exhibit at the hearing. In dicta, however, that court had found it possible that Fam C §217 and CCP §2009 were not “‘mutually exclusive.’”

 

Absence made her wallet thinner . . .
Here, the justices did not need to decide whether Fam C §217 makes written declarations filed with family law motions subject to the hearsay rule “in every case.” It was enough that they concluded that the CCP §2009 hearsay exception does not apply to a motion to modify a family law judgment if the opposing party objects to its admission on the grounds that he or she is unable to cross-examine the declarant. That objection, the panel reasoned, is both an effort to exclude hearsay testimony and an invocation of his or her right to live testimony under Fam C §217. Here, Leon objected to the trial court’s admission of Sandra’s I&E declaration because he was unable to cross-examine her as to its content; and the trial court made no finding of good cause to consider it instead of live testimony. In fact, the trial court “gave every indication” that it did not intend to consider the declaration in making its decision. Given all that, the justices concluded that the trial court erred by relying on Sandra’s declaration in its statement of decision.

 

No there there . . .
Without the declaration, the justices found, the trial court had no evidence of her need for support; it had only Leon’s evidence regarding her share of his retirement benefits. That evidence tended to show that Sandra would be receiving roughly the same amount in retirement benefits as she formerly received in spousal support. Under these circumstances, the justices found, the trial court abused its discretion by ordering any spousal support and declining to terminate Leon’s spousal support obligation. Accordingly, the justices reversed the trial court’s order and terminated Leon’s spousal support obligation.

 

 

Comment

  

Sandra not only failed to file an opposition to Leon’s request, she filed nothing in his appeal. Given that she would receive more from her share of his retirement benefits than she had from his spousal support payments, it’s not unreasonable to assume that she saw no reason to file a response in either proceeding. She’d be OK even if spousal support terminated, as it did here.

 

 

Long before Elkins and the enactment of Fam C §217, family law attorneys have questioned the value of the I&E declaration; the general belief has been that they are full of inflated numbers as to expenses and downplayed numbers as to income. And, many attorneys have been present at hearings in which the trial judge was equally unimpressed by the information on the parties’ I&E’s and said so. Nonetheless, this case shows us that the I&E can be useful in opposing the other party’s requests, if the case involves live testimony and the opposition isn’t available for cross-examination. Attorneys might mention this to clients who are reluctant to appear at the hearing for some reason (we’ve all had them).

 

 

The justices leave for another day a ruling on whether Fam C §217 and CCP §2009 are mutually exclusive. The latter provides a hearsay exception that gives trial courts discretion to decide family law motions on affidavits as long as they do not involve fact-finding that results in a judgment. The former, as we’ve seen, requires a trial court to receive any live testimony that is competent and relevant at a postjudgment hearing, unless it finds good cause not to or the parties so stipulate. Here, the justices determine that when Leon sought to exclude the declaration, he made a hearsay objection and invoked his right under Fam C §217 to require live testimony. Doing that, the panel here concluded, made CCP §2009 inapplicable. It remains to be seen whether this case will be frequently relied on, or will be one of those whose use is limited to the narrow fact pattern here.

 

 

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