Opinion
NOT TO BE PUBLISHED
Contra Costa County Super. Ct. No. MSD96-03056
Jenkins, J.
Pursuant to interlocutory and final judgments, the marriage of Theresa and Leslie Quock was dissolved, permanently resolving issues relating to division of property and child and spousal support. Both parties now contend the final judgment must be reversed based on a variety of purported errors. We reverse the final judgment in part, affirm it in part, and remand the matter to the trial court for further consideration of certain issues in light of the conclusions we reach below.
FACTUAL AND PROCEDURAL BACKGROUND
Theresa and Leslie Quock were married June 1, 1986, and permanently separated November 1, 1998. They have three children, ages 15, 17 and 20.
During and after marriage, Leslie was employed as a senior vice president and trust director for Wells Fargo Bank. Theresa was employed as an accountant from 1976 through 1993, and as a general auditor and vice president for Safe way Corporation in 1993 until she voluntarily left the workforce at the end of that year to care for the children.
For ease of reference, we identify the parties by their first names, intending no disrespect.
At the time of separation, Leslie and Theresa together owned a significant amount of assets, including investment accounts, real property (including a time-share vacation property), checking and savings accounts, equity lines, stock options, retirement funds, and various other forms of deferred compensation.
In May 2001, the trial court filed an order after hearing concerning, among other things, child and spousal support. Theresa was awarded temporary spousal support in the amount of $3,500 per month, but was warned by the trial court to return to full-time employment within 6 months. Leslie, who had custody of the three children, was awarded offsetting child support in the amount of $1,533 per month.
In September 2001, the parties stipulated to the appointment of John Mangini, a certified public accountant, as a joint accounting expert. As accounting expert, Mangini was given the task to, among other things, trace and calculate community and separate property, trace all flows of income available for support, determine the parties’ claims to certain credits, reimbursements and charges, and account for and characterize the parties’ retirement and other investment funds.
In October 2002, the trial court held another hearing in this matter to address issues of spousal and child support. At the hearing, the trial court again warned Theresa that she must return to full-time employment within a reasonable period of time, and found that, effective September 1, 2002, employment income in the amount of $5,000 was to be imputed to her for purposes of calculating support.
Mangini submitted his initial report in June 2004. In November 2004, the trial court set a one day trial regarding the characterization and division of property identified in Mangini’s report. At the 2004 trial, Mangini appeared as a witness and his report was admitted into evidence, but before he completed his testimony, trial was interrupted by a criminal trial that had calendar preference. During recess, however, the parties were able to resolve several issues by stipulation, including issues related to the division of certain stock, dividends and other property.
Trial was continued on January 23, 24 and 25, 2006, at which time several remaining issues were heard. The parties submitted lengthy declarations in lieu of live testimony in advance of trial. In addition, the parties submitted exhibits and appeared with Mangini as witnesses at trial.
On June 6, 2006, the trial court filed a tentative statement of decision. Both parties filed lengthy objections to that tentative decision and, on January 11, 2007, the trial court entered the final judgment regarding child and spousal support, property division, retirement accounts and attorney’s fees, attaching the final statement of decision as an exhibit. This appeal and cross-appeal followed.
DISCUSSION
Theresa contends the final judgment must be reversed on appeal because the trial court erred in: (1) calculating spousal support; (2) failing to reimburse her or the community for certain interest payments; (3) treating certain commingled accounts as Leslie’s separate property; (4) applying an erroneous tax rate when calculating the community’s interest in certain stock; (5) applying the so-called “time rule” when calculating the community’s interest in certain deferred compensation; (6) reimbursing Leslie for amounts paid for life insurance policy premiums; (7) failing to calculate the community’s interest in certain assets as of the date of trial; (8) crediting Leslie for amounts paid to experts; (9) crediting Leslie for a $30,000 payment made to her; (10) failing to credit her for Leslie’s purchase of certain stock; (11) relying on a flawed expert report; (12) reimbursing Leslie for child support add-ons; (13) violating her right to due process; and (14) declining to sanction Leslie for his breach of fiduciary duty.
On cross-appeal, Leslie contends the trial court erred in apportioning his Wells Fargo Bank 401k plan between community property and separate property. In addition, Leslie contends that, should we reverse the final judgment on any ground raised by Theresa, we should also remand for reconsideration of the spousal support and attorney’s fees orders based on the change in wealth distribution resulting from such reversal.
I. Standard of Review.
Where a party challenges the trial court’s factual findings in support of its final judgment in a marriage dissolution case, our review is limited to a determination of whether substantial evidence exists in support of such findings. (In re Marriage of Drake (1997) 53 Cal.App.4th 1139, 1151.) “On review for substantial evidence, we examine the evidence in the light most favorable to the prevailing party and give that party the benefit of every reasonable inference. (In re Marriage of Catalano (1988) 204 Cal.App.3d 543, 548.) We accept all evidence favorable to the prevailing party as true and discard contrary evidence. (Ibid.)” (In re Marriage of Drake, supra, at p. 1151.)
Further, we acknowledge “the trial court has broad discretion to achieve equity in the distribution of marital assets.” (In re Marriage of Zaentz (1990) 218 Cal.App.3d 154, 164.) “Courts have frequently pointed out that the disposition of marital property is within the trial court’s discretion, by whatever method or formula will ‘achieve substantial justice between the parties.’ (Tassi v. Tassi (1958) 160 Cal.App.2d 680, 691 [325 P.2d 872]; see also In re Marriage of Poppe [(1979)] 97 Cal.App.3d [1,] 11.) Similarly, ‘ “ ‘In making such apportionment between separate and community property our courts have developed no precise criterion or fixed standard, but have endeavored to adopt that yardstick which is most appropriate and equitable in a particular situation . . . ” [Citations.]’ (Beam v. Bank of America (1971) 6 Cal.3d 12, 18 [98 Cal.Rptr. 137, 490 P.2d 257].)” (In re Marriage of Hug (1984) 154 Cal.App.3d 780, 791.)
II. Calculating Spousal Support.
A. Imputing an annual income of $112,500 to Theresa.
Theresa first contends the trial court erred by imputing employment income to her in the amount of $112,500 per year when calculating child and spousal support. According to Theresa, the trial court’s decision in this regard was erroneous because it conflicted with an October 2002 court order, based on a stipulation by the parties, to impute to her an employment income of $5,000 per month when calculating support. Theresa further argues the trial court’s decision was not supported by any evidence that she was capable of earning an income of $112,500 per year. We disagree with both claims.
We first consider whether the trial court was bound to follow the October 2002 order when imputing income to Theresa for purposes of setting spousal and child support. That order provided in relevant part:
“Effective September 1, 2002, [Theresa] has an earning capacity of $5,000 per month (employment income) and in any future calculation of support, whether it be retroactive (to September 1, 2002, only) or prospective, the Court shall impute to her wage income of $5,000 per month. The imputation of income shall be relevant to all matters concerning child support, spousal support and attorneys’ fees after September 1, 2002.” [¶] “Notwithstanding the above, [Theresa] shall continue to make good faith efforts to seek and find actual employment. When she finds such employment, her income shall be either $5,000 per month or the amount of her actual employment compensation, whichever is higher.”
In seeking to reverse the trial court’s decision to impute a higher income to her than that provided for in the October 2002 order, Theresa argues that “[a]n agreement as to support may not be modified except by the parties.” In doing so, Theresa relies upon Family Code section 3651. Under that statute, however, a presumption exists that both child and spousal support agreements are indeed modifiable by court order. (In re Marriage of Hufford (1984) 152 Cal.App.3d 825, 828.) In fact, with respect to child support orders, “[t]he court’s jurisdiction over child support issues may not be restricted by the parents, and any agreement purporting to modify or divest the court’s jurisdiction over child support is void as contrary to public policy.” (In re Marriage of La Bass & Munsee (1997) 56 Cal.App.4th 1331, 1341.)
Unless otherwise stated, all statutory citations herein are to the Family Code.
Section 3651 provides in relevant part:
California courts have likewise recognized that public policy favors flexibility in adopting spousal support awards. “ ‘[F]lexibility in the administration of judgments which will affect the lives of the parties far into the future, especially after very lengthy marriages, is to be encouraged; in few other fields do the equities scream quite so loudly as they do in family law.’ . . .” (In re Marriage of Armato (2001) 88 Cal.App.4th 1030, 1036-1037.)
Thus, California law permits parties to stipulate to the non modifiability of spousal support agreements. However, given the important public policies underlying section 3651, such agreements are enforceable only if they contain “some specific unequivocal language directly on the question of modification.” (Fukuzaki v. Superior Court (1981) 120 Cal.App.3d 454, 458; see also In re Marriage of Jones (1990) 222 Cal.App.3d 505, 510.) Here, the October 2002 order, which is based upon the parties’ stipulation, contains no such specific unequivocal language precluding modification of Theresa’s support. In fact, the order fails to mention the subject of modifiability. As such, we reject Theresa’s claim that the trial court was bound by the October 2002 order in setting permanent spousal support. (Fukuzaki, supra, 120 Cal.App.3d at p. 458 [“The import of [section 3651] may not be ‘avoided by drawing inferences as to the intention of the parties’ from general provisions of the agreement which do not contain a specific provision concerning judicial modification.”]; In re Marriage of Jones, supra, 222 Cal.App.3d at pp. 509-510 [declining to infer non modifiability where the spousal support agreement “contained no articulated reference to either a power of court modification or preclusion of court modification”].)
Moreover, we conclude substantial evidence supported the trial court’s finding that a yearly employment income of $112,500 was imputable to Theresa. As the record reveals, Theresa holds a bachelor of science degree in accounting and, when she left the work force at the end of 1993 to provide full-time care for her children, had attained the position of chief auditor and vice president for a major corporation earning over $120,000 per year in salary, bonuses, and other benefits. In fact, Theresa was the fourth woman vice president in the history of Safe way Corporation, which had over 110,000 employees. Court-appointed vocational expert Susan Stevenson found, based on this evidence, that Theresa was capable of earning between $75,000 and $150,000 per year due to Theresa’s “high level of career success over approximately 18 years of work life . . . ” Neither party challenged Stevenson’s expertise at trial, and her reports, drafted in 1997 and updated in 2001, were received into evidence without objection. The trial court’s imputation of a yearly employment income of $112,500, an amount falling squarely within Stevenson’s range, was thus adequately supported by the evidence.
In so concluding, we note that Theresa correctly points out that modification of a spousal support order requires a material change of circumstances, such as an increase or decrease in the supported spouse’s needs, since the last order. (In re Marriage of McCann (1996) 41 Cal.App.4th 978, 982; In re Marriage of Bider man (1992) 5 Cal.App.4th 409, 412.) Here, however, contrary to Theresa’s claim, such a material change undoubtedly occurred. As the trial court found, “[d]espite having been told repeatedly by the court to seek employment and having been warned repeatedly that her failure to do so would result in the imputation of income to her, [Theresa] has for over seven years utterly failed to take the reasonable and obvious steps necessary to become employed.” In so finding, the trial court discredited Theresa’s testimony that she had made serious efforts to find employment, finding instead that her justifications for continued unemployment were “insubstantial and unsubstantiated excuses concocted to hide her deliberate refusal to look for a job.” We decline to second guess the trial court’s reasoned judgment in this regard. (In re Marriage of Slivka (1986) 183 Cal.App.3d 159, 162 [conflicts in evidence must be resolved on appeal in favor of the trial court’s decision].)
Given this evidentiary record, we have no problem affirming the trial court’s decision to impute an annual employment income of $112,500 to Theresa.
B. Considering Leslie’s Average Income for the Last Six Years of Marriage.
Theresa contends the trial court erred in calculating spousal support for another reason. Specifically, Theresa claims the trial court erred in considering the average of Leslie’s income during the six-year period immediately preceding the date of the parties’ separation, rather than his income at the time of trial, when setting the amount of spousal support. According to Theresa, “[t]he law requires the court to calculate spousal support based upon the payor spouse’s ability to pay at the time of trial . . . ” We disagree.
“Determining the issue of spousal support, including its amount and duration, is one of the most difficult and challenging tasks a judge faces.” (In re Marriage of Smith (1990) 225 Cal.App.3d 469, 494.) In executing this task, the trial court is granted broad discretion. Such discretion is abused only when it “ ‘exceeds the bounds of reason’ in light of all of the circumstances.” (In re Marriage of Harrison (1986) 179 Cal.App.3d 1216, 1230.)
Under section 4330, subdivision (a), “the court may order a party to pay for the support of the other party an amount, for a period of time, that the court determines is just and reasonable, based on the standard of living established during the marriage taking into consideration the circumstances as provided in Chapter 2 (commencing with Section 4320).” (§ 4330, subd. (a).) Those circumstances include, among others, the earning capacity of each party, the marketable skills of the supported party, the ability of the supporting party to pay spousal support, the needs of each party based on the standard of living established during the marriage, the goal that the supported party shall be self-supporting within a reasonable period of time, and other factors the court deems to be just and equitable. (Ibid.)
Section 4320 provides:
Here, as Theresa points out, the trial court considered Leslie’s average annual income for the six years leading up to the parties’ separation ($218,894), rather than his current income (over $500,000), when it ordered spousal support in the amount of $4,000 per month from January 1, 2006 to January 1, 2008, at which time such support was to be reduced to a reservation of jurisdiction. In doing so, the trial court acted appropriately. Section 4320, set forth above, expressly permits the trial court to consider the marital standard of living when ordering support. As our colleagues in Division 5 of this District have noted, “the Legislature intended ‘marital standard of living’ to be a general description of the station in life the parties had achieved by the date of separation and this is satisfied by the everyday understanding of the term in its ordinary sense, i.e., upper, middle or lower income.” (In re Marriage of Smith, supra, 225 Cal.App.3d at p. 491 [emphasis added].)
Moreover, contrary to Theresa’s suggestion, Leslie’s income during the last years of the marriage was far from the only factor the trial court considered in calculating spousal support. Rather, the court considered each of the factors set forth in section 4320, subdivision (a). In doing so, the trial court noted that Theresa had failed to make substantial efforts to become self-supporting within a reasonable period of time, despite being repeatedly ordered to do so, and that, had she followed the recommendations of vocational expert Stevenson, she would likely be earning over $150,000 per year at present. Given the substantial period of time that had passed since the parties’ separation, the trial court could have reasonably concluded these factors were entitled to more weight in calculating spousal support than other factors, including Leslie’s income during or after the marriage. (In re Marriage of Shaughnessy (2006) 139 Cal.App.4th 1225, 1247-1248 [where substantial time has passed since separation, the trial court may “reasonably conclude that achieving the marital standard of living [is] at this point in time deserving of less weight in balancing the section 4320 factors”].)
Given the trial court’s thorough analysis of the relevant factors under section 4320, we conclude it acted well within the scope of its discretion in calculating spousal support. (In re Marriage of Smith, supra, 225 Cal.App.3d at p. 492 [the trial court acted appropriately where “the support ordered was sufficient to meet the supported spouse’s reasonable needs considering all applicable factors under [the Family Code], including the marital standard of living”].) In so concluding, we note that “[t]he role of the appellate court is not to second-guess the trial judge. . . . [¶] ‘We therefore heed “the well admonished rule of appellate review which finds a presumption that the court performed its duties in a regular and correct manner absent a clear showing to the contrary.” [Citation.] “[T]he fact that a more liberal award might have been supported is not a proper test. [Citation.]” ’ [Citations.]” (In re Marriage of Smith, supra, at p. 494 .)
III. Disposition of Property.
Theresa raises a number of issues relating to the trial court’s disposition of the community property in this case. We address each issue in turn.
A. Allocating Interest Payments.
Theresa contends the trial court erred in: (1) refusing to reimburse the community for interest incurred as a result of a margin loan taken out by Leslie from a community investment account to repay his separate property debt; (2) refusing to reimburse her for interest she paid on community credit card debt; and (3) refusing to reimburse the community for interest incurred when Leslie failed to deposit the proceeds from the repayment of a community loan into the community investment account from which the loan was made. We disagree with all three arguments.
With respect to Theresa’s first argument, the following facts are relevant. Leslie took out a $60,000 margin loan during the marriage from Charles Schwab investment account number xxx938. The loan was later partially repaid. Theresa contends the trial court erred by not charging Leslie for the interest charged to account number xxx938, and for the loss of dividends and other interest income that would have been earned on the account, as a result of his margin loan.
The second argument relates to several credit card accounts Theresa opened during the marriage that she used exclusively for her own purposes. The trial court found the credit card accounts were community property. Theresa contends the trial court erred by not crediting her for interest payments she made on these accounts after the date of separation.
The third argument relates to a $15,000 margin loan paid from Charles Schwab investment account number xxx938 during the marriage to Theresa’s sister. Theresa’s sister later repaid $13,250 of the loan in two installments, both of which Leslie deposited into his separate property bank account. The trial court thereafter charged Leslie with a $13,250 advance against the community property investment account. Theresa contends the trial court erred by not also charging Leslie for the interest the community incurred as a result of the outstanding margin loan.
In his report, Mangini recommended that interest charges not be allocated with respect to these or any other transactions involving community property. In making that recommendation, Mangini noted that, among other things, Theresa had withdrawn $25,000 from the same Charles Schwab investment account (number xxx938) for her personal use after the date of separation, but had not been charged interest in connection with her advance, and that Leslie had received a separate property credit for his deposit into that account of stock worth $34,687.50 purchased with inherited funds, but had not received a credit for interest earned as a result of his deposit. In following Mangini’s recommendation, the trial court noted that Mangini’s treatment of interest applied equally to both parties.
We conclude the trial court’s decision to follow Mangini’s recommendation in this regard was within the proper scope of its discretion. As the California Supreme Court has stated, trial courts are vested with considerable discretion in dividing community property in order to assure that an equitable settlement is reached. (In re Marriage of Connolly (1979) 23 Cal.3d 590, 603.) “The exercise of a trial court’s sound discretion is best preserved by maintaining a maximum degree of allowable flexibility.” (Ibid.) Indeed, “[a] special benefit of [our legal] system which allows for equitable considerations, especially in the family law field, is to afford the judge before whom the litigants appear, subject to applicable legal principles, the opportunity to fashion a remedy which achieves a just result. While critics may claim this results in inconsistency, we believe the strength of the judicial system is enhanced when the judiciary possesses the ability in family law cases to tailor a remedy to fit the circumstances of the individual litigants before the court.” (In re Marriage of Hug, supra, 154 Cal.App.3d at p. 794.)
Here, the trial court employed its considerable discretion to tailor a remedy with respect to the treatment of interest charges, as well as dividend and other earnings, that, given the number and complexity of the parties’ financial transactions, was both fair and practical. Accordingly, we find no basis to disturb the trial court’s decision in this regard.
B. Treatment of Commingled Accounts.
Theresa challenges the trial court’s finding, based on Mangini’s report, that two bank accounts – Wells Fargo investment account number xxxx659 (the investment account) and Wells Fargo checking account number xxxx196 (the checking account) – were Leslie’s separate property subject to certain charges for the deposit of community funds into those accounts. Theresa claims the trial court should have instead treated both accounts as community property subject to certain credits for Leslie’s deposit of separate funds into those accounts.
The following facts are relevant to Theresa’s challenge. The checking account, established before the date of separation, was accessible solely by Leslie. The trial court found that, through the date of separation (November 1, 1998), the account was community property, but afterwards it was Leslie’s separate property. Based on Mangini’s report, the trial court credited Leslie for certain amounts paid from the account to Theresa or on behalf of community interests after the date of separation. The record shows that many, if not most, deposits made into this account after the date of separation were Leslie’s paychecks or his employee expense reimbursements, or were transfers from his personal savings account.
The investment account, established after the date of separation, was initially funded with Wells Fargo stock granted to Leslie before the date of separation, beginning in 1994, in the form of “restricted share rights” (Rs R's). Additional Rs R's were deposited into the account in 2001 and 2002 and, in 2003, 3,260 shares of Wells Fargo stock were deposited into the account when Leslie exercised incentive stock options that were granted to him in 1998 before the date of separation. Other deposits of Wells Fargo stock were received into the account in 2002 and 2003. Mangini treated the account as Leslie’s separate property subject to receipt of further documentation identifying the sources of deposits made into the account. The trial court likewise treated the account as Leslie’s separate property, and then charged him for the community’s interest in both the Rs R's and the incentive stock options.
Theresa claims the trial court’s decisions with respect to these two accounts were erroneous. In doing so, Theresa correctly points out that a presumption exists that all property acquired by either spouse during marriage is community property. (§ 760; In re Marriage of Mix (1975) 14 Cal.3d 604, 611-612.) This presumption, however, may be overcome. “[C]ommingling of separate property and community property funds does not alter the status of the respective property interests, provided that the components of the commingled mass can be adequately traced to their separate property and community property sources.” (In re Marriage of Braud (1996) 45 Cal.App.4th 797, 822-823.) If, however, “the separate property and community property interests have been commingled in such a manner that the respective contributions cannot be traced and identified, the entire commingled fund will be deemed community property pursuant to the general community property presumption of section 760.” (Id. at p. 823.)
“Whether the spouse claiming a separate property interest has adequately met his or her burden of tracing to a separate property source is a question of fact and the trial court’s holding on the matter must be upheld if supported by substantial evidence. (In re Marriage of Braud, supra, 45 Cal.App.4th at p. 823; In re Marriage of Higinbotham (1988) 203 Cal.App.3d 322, 328 [249 Cal.Rptr. 798].)” (In re Marriage of Cochran (2001) 87 Cal.App.4th 1050, 1057-1058; see also In re Marriage of Mix, supra, 14 Cal.3d at pp. 611-612.)
Here, the evidence sufficiently established that the funds in the checking account and the investment account were traceable to Leslie’s separate property. Mangini’s report attached as exhibits I and K charts containing detailed analyses of nearly all, if not all, the deposits and withdrawals made to and from these two accounts during the relevant period of time. Those charts contained information that included, among other things, the source, date and amount of such deposits and withdrawals. Using this information, Mangini was able to identify in his report the amount of separate and community funds contained in the two accounts. (In re Marriage of Mix, supra, 14 Cal.3d at pp. 611-612 [“ ‘[S]eparate funds do not lose their character as such when commingled with community funds in a bank account so long as the amount thereof can be ascertained.’ ”]
Further, to the extent Theresa disagreed with Mangini’s tracing of Leslie’s separate property to these accounts, her attorney had ample opportunity at trial to cross-examine him on it.
During this cross-examination, much of the questioning related to Mangini’s characterization and treatment of the Rs R's and the incentive stock options that were deposited in the investment account. As the trial court noted, however, the parties had accepted Mangini’s characterization and treatment of the Rs R's and the incentive stock options when they stipulated to the accuracy of the information set forth in exhibits U and V. The trial court also noted, and Theresa’s attorney agreed, that “the facts of the transactions [involving the funds in the investment account, which were identified in exhibit K] are not in dispute.” As Theresa’s attorney acknowledged, Theresa stipulated to the accuracy of the information set forth in exhibit K with two caveats that are not relevant here.
Given this evidence, which we view in the light most favorable to the trial court’s decision, we conclude the trial court did not abuse its discretion in finding that these two accounts were Leslie’s separate property. (In re Marriage of Mix, supra, 14 Cal.3d at pp. 611-612; see also In re Marriage of Braud, supra, 45 Cal.App.4th at p. 825; In re Marriage of Cochran, supra, 87 Cal.App.4th at pp. 1056-1058.)
C. Applying a 45 Percent Tax Rate.
Theresa contends the trial court erred in accepting Mangini’s use of a 45 percent tax rate in calculating the community’s interest in certain Rs R's that were granted to Leslie during the marriage by Wells Fargo. Theresa contends Mangini should instead have used a rate between 37 and 41 percent, the range of Leslie’s effective tax rate between the years 1999 through 2002.
Theresa does not challenge Mangini’s application of a 15 percent tax rate to the dividends earned on the Rs R's.
As Leslie points out, however, Theresa stipulated before trial to the tax rate used by Mangini in calculating the community’s interest in the Rs R's. Specifically, Theresa stipulated “to the factual accuracy of the information set forth, and accept the tax rates utilized, in Exhibits S, T, U and V to the Mangini Report, being Exhibit 1 in evidence. Each party, however, reserves any claims he or she may have with regard to the information in said Exhibits, but they have accepted the determination made by Mr. Mangini reflected in said Exhibits as binding upon them.” Exhibit U to Mangini’s report reflects his calculation of the community’s interest in the Rs R's granted to Leslie during the marriage, and note 3 to that exhibit identifies 44.97 percent (35.67 for Federal taxes and 9.3 percent for State taxes) as the tax rate utilized. As such, we conclude Theresa’s argument in this regard is waived.
In disputing that she waived her right to challenge the 45 percent tax rate, Theresa points to her attorney’s extensive cross-examination of Mangini at trial regarding the rate. Cross-examination at trial, however, has no effect on the enforceability of a pre-trial stipulation.
In any event, waiver aside, “a trial court has the ability to determine the credibility of an expert’s opinion including the reasonableness of underlying factors used in forming that opinion.” (In re Marriage of Sheldon (1981) 124 Cal.App.3d 371, 384.) Here, in choosing the 45 percent rate, Mangini noted that Leslie had been taxed at or near the top rate for each of the relevant years, and that “it would have been terribly expensive and time-consuming to try to determine at what point those dollars came in for each particular year.” Mangini further explained that it was proper to consider Leslie’s tax rate, although it was higher than Theresa’s tax rate, because, regardless of her interest in the Rs R's, they would be subject to taxation at Leslie’s rate when exercised. Given Mangini’s adequate explanation of his decision to use a 45 percent tax rate, the trial court acted within the scope of its discretion in accepting it.
D. Using the Time Rule to Calculate the Community’s Interest in Deferred Compensation.
Theresa claims the trial court erred in adopting Mangini’s calculation of the community’s interest in certain Rs R's granted to Leslie by Wells Fargo before the date of separation. According to Theresa, the community’s interest in the Rs R's should have been calculated as of the date they were granted. Instead, Mangini calculated the community’s interest by applying the so-called time rule, which took into account both the date the Rs R's were granted and the date they become vested.
The term “time rule” refers to a formula for determining the community’s interest in stock options or related employment benefits that, as here, are granted before the date of separation but become exercisable after the date of separation. (In re Marriage of Hug, supra, 154 Cal.App.3d at pp. 782, 784 & fn. 2.) Under the time rule, the community’s interest is generally calculated “according to the ratio of the length of employment between the date of marriage (or date of commencement of employment, if later) and the date of separation to the total length of employment.” (Id. at p. 784, fn. 2.) The time rule thus accounts for the fact that post separation earnings of a spouse are the separate property of that spouse (§ 771), but that pre-separation earnings are generally community property (§ 760). (See also In re Marriage of Hug, supra, 154 Cal.App.3d at pp. 784-785.) As courts have recognized, “there is no compelling reason to require that employee stock options [or other related types of employment benefits] must always be classified as compensation exclusively for past, present, or future services. Rather, since the purposes underlying [employment benefits] differ, reference to the facts of each particular case must be made to reveal the features and implications of a particular [benefit].” (Id. at p. 784.)
As such, with respect to apportioning a spouse’s employment benefits in dissolution proceedings, the trial court “has discretion in the choice of methods. [Citations.] Such methods include the time rule, which is apparently the one that is employed most frequently. [Citations.] Whatever the method that it may use, however, the superior court must arrive at a result that is ‘reasonable and fairly representative of the relative contributions of the community and separate estates.’ [Citation.]” (In re Marriage of Lehman (1998) 18 Cal.4th 169, 187; see also In re Marriage of Hug, supra, 154 Cal.App.3d at p. 792 [“[N]o single rule or formula is applicable to every dissolution case involving employee stock options. Trial courts should be vested with broad discretion to fashion approaches which will achieve the most equitable results under the facts of each case.”].)
Here, both Leslie and Mangini testified that Leslie received the Rs R's as a form of compensation, but was entitled to actually be paid on them only if he remained employed by Wells Fargo on the date the Rs R's become vested. In other words, Leslie’s right to be paid on the Rs R's was dependent on his continued employment with the company. Mangini, applying the time rule, thus prorated the number of days from the Rs R's grant date to the date of separation, and then the number of days from the separation date to the Rs R's vest date. Using this formula, Mangini found, and the trial court accepted, that, of the 6,470 Rs R's with a grant date before separation but a vest date after separation, the community had an interest in 5,709 shares, of which Theresa was entitled to half, or 2,854.5 shares, net of taxes.
Applying the abuse of discretion standard of review, as the law requires (In re Marriage of Lehman, supra, 18 Cal.4th at p. 187), we conclude the trial court did not err in calculating the community’s interest in the Rs R's based on application of the time rule. Given that Leslie’s right to be paid on those shares required his continued employment after the parties’ separation, use of the time rule in this instance to apportion those shares yielded “a result that is ‘reasonable and fairly representative of the relative contributions of the community and separate estates.’ [Citation.]” (Ibid.) Theresa’s argument to the contrary is thus rejected.
E. Reimbursements for Payment of Life Insurance Policy Premiums.
Theresa claims the trial court erred in reimbursing Leslie for $16,620 in monthly payments he made toward a life insurance policy in his name, and in failing to reimburse her for monthly payments she made toward a life insurance policy in her name. Leslie counters that the trial court’s decisions in this regard were proper because substantial evidence supported his reimbursement of $16,620, and because no evidence supported Theresa’s claim for reimbursement.
The trial court, following Mangini’s report, treated all life insurance policies as community property. As such, the trial court ordered reimbursement to Leslie for 85 monthly payments he made after the date of separation with separate funds in the amount of $195.53 each toward his policy.
While the record reflects that Leslie’s monthly premiums increased from $195.53 to $372.36 per month in March 2000, Leslie did not seek, and the trial court did not award, reimbursement for the increased amount.
The trial court’s decision to reimburse Leslie in the amount of $16,620 – 85 months times $195.53 – was based on substantial evidence. In particular, exhibit I to Mangini’s report tracked payments made from Leslie’s separate property Wells Fargo checking account, including his actual payment of the $195.53 premium each month. As such, we decline to disturb the trial court’s decision. (In re Marriage of Cochran, supra, 87 Cal.App.4th at pp. 1057-1058.)
Further, with respect to the life insurance policy held in Theresa’s name, as Mangini testified at trial, Theresa provided no evidence of any amounts she paid in premiums after the date of separation. As such, the trial court acted within the scope of its discretion in declining to reimburse her for any such payments.
F. Failing to Calculate the Community’s Interest in Assets as of Trial.
Theresa claims the trial court erred in calculating the community’s interest in certain unpaid deferred income as of May 2004, rather than as of the date of trial. Specifically, Theresa claims the trial court erred in failing to update to the date of trial the dividend income earned from Leslie’s RSR’s and from his benefit restoration program. We agree, at least in part.
Theresa further argues that Mangini improperly used a 45 percent tax rate in dividing these assets. Because we have already rejected Theresa’s argument with respect to the tax rate employed by Mangini, we need not address it again here. (Ante, at pp. 16-17, post at p. 24.)
Section 2552, subdivision (a), provides in relevant part: “For the purpose of division of the community estate upon dissolution of marriage or legal separation of the parties, . . . the court shall value the assets and liabilities as near as practicable to the time of trial.” (§ 2552, subd. (a); see also In re Marriage of Reuling (1994) 23 Cal.App.4th 1428, 1434-1435 fn. 2 [the trial court is required to divide the community property equally at the time of judgment, unless one party shows good cause to value the property at a date after the separation and prior to trial].)
Here, with respect to the RSR dividends, Mangini testified that he had calculated the amount owed to the community as of May 2004. According to exhibit U, such calculation totaled $32,038.32 as of May 2004. Mangini further testified that he had proposed updating that calculation, but that the parties had not yet agreed to his proposal. The parties thereafter agreed to have the calculation updated, and Mangini returned to the stand to testify that Leslie owed an additional $3,800 to Theresa, representing one-half the tax-affected amount of RSR dividends earned from June 2004 through the end of 2005.
As Theresa points out, however, it appears the trial court failed to include this additional amount in the final judgment. The trial court’s statement of decision states that $32,038.32 was owed in RSR dividends, the amount exhibit U reflects was owed as of May 2004, but the statement nowhere references the additional $3,800 owed for the period of June 2004 through 2005. Nor is such amount mentioned in the division of property included in the final judgment. As such, we remand to the trial court for the limited purpose of accounting for the additional amount owed with respect to the RSR dividends. (In re Marriage of Olson (1980) 27 Cal.3d 414, 422 [“the court shall value the assets and liabilities as near as practicable to the time of trial”].)
With respect to the benefit restoration program, the trial court ordered in the final judgment, based on a stipulation dated November 19, 2004, that each party receive one half of this community asset as of the date of the asset’s actual division (which was ordered to occur within 30 days of the judgment’s filing date of January 11, 2007). As stated, it appears the judgment thus provides for payment of dividends earned at least up to the date of trial by granting each party a one half interest as of the date of the asset’s actual division. Leslie has requested that we take additional evidence allegedly proving that, since trial, he has paid Theresa the full amount owed with respect to such dividends. Rather than grant Leslie’s request, however, we remand to the trial court for confirmation of such payment.
G. Crediting Leslie for Payments to Experts.
The trial court ruled that the parties would share equally the cost of fees incurred for the services of various experts retained to serve both their interests in this matter. Consistent with that ruling, the trial court found that Leslie was entitled to be reimbursed by the community for $28,710 in expert fees he paid with separate funds to, among others, Susan Stevenson, Dr. Christine Pigeon, Marsha Hofer, and Theresa Schuman. The trial court further determined Leslie was entitled to a credit for $41,074.50 in expert fees he paid with separate funds to Mangini.
On appeal, Theresa claims the trial court’s decisions in this regard were unsupported by substantial evidence. Specifically, Theresa claims the $28,710 reimbursement was improper because “at least $7,200 of these payments [to the various experts] was undisputedly made with community funds.” She claims the $41,074.50 credit was likewise improper because that amount was paid to Mangini with community rather than separate funds. We reject both arguments.
With respect to the $28,710 reimbursement, we conclude the trial court’s decision was supported by Leslie’s declaration in lieu of live testimony. In particular, Leslie declared under oath that, since the date of separation, he had paid $1,875 to court-appointed vocational expert Stevenson, $8,400 to Dr. Christine Pigeon, $6,000 to Marsha Hofer, $9,200 to Theresa Schuman, and $3,235 to his children’s attorney, Daniel Harkins – an amount totaling $28,710, the same amount awarded in reimbursement to Leslie for expert fees. Theresa claims these amounts could have been paid by Leslie with community funds, and that substantial evidence does not prove otherwise. In particular, Theresa points to evidence suggesting that at least $3,500 of these fees could have been paid by Leslie after the date of separation with community funds. Leslie’s declaration states, however, that “[n]one of these amounts has been shared by [Theresa] nor has she reimbursed me either directly or indirectly for any of them.” The trial court had a reasonable basis, given this statement, for inferring that Leslie paid these expert fees with his separate property. As such, the trial court’s decision was supported by substantial evidence, and must be affirmed, even if contrary evidence exists. (In re Marriage of Mix, supra, 14 Cal.3d at p. 614 [“ ‘The testimony of a witness, even the party himself, may be sufficient [to constitute substantial evidence].’ [Citation.]”]; In re Marriage of Drake, supra, 53 Cal.App.4th at p. 1151, quoting In re Marriage of Catalano, supra, 204 Cal.App.3d at p. 548 [“On review for substantial evidence, we examine the evidence in the light most favorable to the prevailing party and give that party the benefit of every reasonable inference.”]; In re Marriage of Zaentz, supra, 218 Cal.App.3d at p. 165 [“The trial court was within its discretion to rely on th[e] testimony notwithstanding the existence of conflicting evidence.”].)
Theresa points to evidence that Dr. Hofer was paid $2,500 and Susan Stevenson was paid $1,200 with community funds before the date of separation. At issue, however, are payments Leslie said he made to experts after the date of separation. Theresa also points to one payment made to Dr. Hofer after separation in the amount of $3,500 which, according to a chart attached to Mangini’s report, was made with funds in a community savings account. Such evidence, however, does not necessarily conflict with Leslie’s statement in his declaration that he personally paid $6,000 to Dr. Hofer, and that Theresa did not share this expense or reimburse him for it.
With respect to the $41,074.50 credit, the trial court found that Leslie made “$41,074.50 (including the proceeds from the sale of RSR shares) in overpayments for his half of CPA Mangini’s total fees . . . ” Substantial evidence likewise supports this decision.
In its tentative statement of decision, the trial court granted Leslie a $7,617 credit for overpayments made with respect to his one-half charge for Mangini’s fees. The trial court also adopted Mangini’s calculation that Leslie had received an advance from community property in the form of 3,065 Rs R's. In Leslie’s objections to the tentative statement of decision, he challenged the court’s $7,617 credit as insufficient, explaining he had sold 675 of the 3,Rs R's R's that were charged against him as an advance from community property and used the proceeds to pay Mancini $33,457. As such, Leslie explained, to avoid being double charged, Leslie was entitled to a credit for the $33,457 paid to Mangini, in addition to the $7,617 credit. Leslie thus claimed a credit totaling $41,074.50 rather than $7,617.
In its final statement of decision, the trial court implicitly adopted Leslie’s reasoning, changing the credit from $7,617 to $41,074. The trial court also reiterated its finding that Leslie had received an advance from community property in the form of 3,065 Rs R's, worth $33,457. We conclude both actions were proper. Bank statements from Leslie’s separate property checking account, attached as an exhibit to Mangini’s report, reflect both the sale of the Rs R's netting $33,457, and the subsequent withdrawal of that amount for purposes of paying Mangini. As such, we affirm the $41,074.50 credit.
We do, however, agree with Theresa in one regard. In her reply brief, Theresa points out that Leslie failed to identify in the record where the trial court actually charged him with the receipt of the $33,457 advance. Theresa notes that the exhibit to the final judgment which purports to set forth the various credits, advances and reimbursements adjudicated by the court fails to include this amount. Having reviewed this exhibit, we agree. As such, we remand to the trial court for the limited purpose of confirming that this $33,457 advance has actually been charged to Leslie.
H. Crediting Leslie for a $30,000 Payment to Theresa.
Theresa claims the trial court erred in finding Leslie was entitled to a credit for a payment he made to her in the amount of $30,000 from his separate property. According to Theresa, substantial evidence failed to prove Leslie paid this amount with separate funds.
In September 2000, the parties agreed in writing that Leslie would pay Theresa $30,000, but failed to agree at that time whether the payment was made with separate or community funds. The trial court ultimately found the payment was made with Leslie’s separate funds deposited in Wells Fargo checking account xxxx196. We conclude this finding was supported by substantial evidence.
As we have already discussed (ante, pp. 13-15), this checking account, established before the date of separation and solely accessible by Leslie, was properly found by the trial court to be Leslie’s separate property after the date of separation.
At trial, Leslie testified that he paid Theresa $30,000 in September 1999 from checking account xxxx196, and that, at that time, the account contained no community property. Leslie further testified that the source of the $30,000 was a wire transfer he received in August 1999 as a result of certain real estate transactions involving his separate property. This testimony from a single competent witness was alone sufficient to constitute substantial evidence. (In re Marriage of Mix, 14 Cal.3d at p. 614.) As such, we reject Theresa’s argument.
I. Failing to Credit the Community in Connection with Leslie’s Purchase of Safe way Stock.
In her opening brief, Theresa argues that the trial court erred in failing to credit the community in connection with Leslie’s purchase in early 1994 of Safe way stock with $34,687.50 in funds withdrawn from his separate property savings account. As Theresa points out, the trial court credited Leslie in the amount of $34,687.50 for his purchase with separate funds of Safe way stock. Theresa claims, however, the trial court erred by then failing to credit the community for 10,000 shares of stock that were purchased with that money.
In response, Leslie counters that Mangini traced the $34,687.50 to the purchase of 2,500 shares – not 10,000 shares – of Safe way Stock that were deposited on February 23, 1994 into the parties’ joint Charles Schwab investment account xxxx938. The trial court ordered that the Charles Schwab investment account would be divided equally between the parties. As such, Leslie argues, the community is entitled to no further credit. Leslie also points out that Theresa has provided no record support for her claim that the $34,687.50 was used to purchase 10,000 shares, rather than 2,500 shares, of Safe way stock.
In her reply brief, Theresa omits any claim to a credit for 10,000 shares of Safe way stock. As such, and given Theresa’s failure to support the argument with record support, we assume she has dropped this argument, and accept Leslie’s counter argument that she has no right to such credit.
J. Relying on Mangini’s Report.
Theresa contends Mangini’s report was inaccurate and based upon incomplete information and, thus, should not have been relied upon by the trial court when dividing the parties’ community property. Theresa suggests, but does not directly argue, that the report should have been excluded from evidence. We disagree.
Under Evidence Code section 730, trial courts regularly appoint experts to investigate and prepare reports concerning marriage dissolution matters. (See, e.g., In re Marriage of Moschetta (1994) 25 Cal.App.4th 1218, 1232; Lester v. Lennane (2000) 84 Cal.App.4th 536, 545.) In addition, parties often stipulate to submit to an evaluation by an expert appointed under Evidence Code section 730, and to admit the expert’s subsequent report into evidence. (See, e.g., Laborde v. Aronson (2001) 92 Cal.App.4th 459, 463.) When that occurs, parties are generally bound by the terms of their stipulated agreement. (In re Marriage of Sheldon (1981) 124 Cal.App.3d 371, 382-384; Pales tis v. Weber & Miller (1958) 161 Cal.App.2d 490, 492.)
Here, Theresa stipulated before trial to Mangini’s appointment as the parties’ joint accounting expert under Evidence Code section 730, stipulated to the admission of Mangini’s report as an exhibit at trial, and failed to object at trial when revised and updated sections of the report were offered as exhibits. Under these circumstances, we conclude she has waived her right to challenge here the trial court’s reliance on the report. As one court observed under similar circumstances: “[T]he investigation and subsequent report of the court investigator were made pursuant to stipulation of the parties, and it is but reasonable and natural to assume that it was contemplated and intended that such report should be used at the hearing. Otherwise, for what purpose was it stipulated that the investigation might be made and the report rendered?” (Noon v. Noon (1948) 84 Cal.App.2d 374, 383.)
Moreover, even were we to reach the merits of Theresa’s argument, we would undoubtedly find the trial court’s reliance on Mangini’s report was proper. Experts are not held to a standard of perfection in drafting reports on complicated accounting matters, such as those involved in this case. Rather, an expert’s opinion is generally admissible so long as it is “[b]ased on matter (including his special knowledge, skill, experience, training, and education) perceived by or personally known to the witness or made known to him at or before the hearing, whether or not admissible, that is of a type that reasonably may be relied upon by an expert in forming an opinion upon the subject to which his testimony relates, unless an expert is precluded by law from using such matter as a basis for his opinion.” (Evid. Code, § 801, subd. (b).) The strength of an expert’s findings and assumptions affect the weight of the evidence, not its admissibility. (See Schreidel v. American Honda Motor Co. (1995) 34 Cal.App.4th 1242, 1253.) Accordingly, where, as here, both parties stipulated to admission of the expert’s report at trial, the trial court could properly rely upon it, even assuming it contained some inaccuracies. As Mangini testified, and the trial court accepted, Mangini was satisfied his report was as close to a complete answer to the property issues as he was capable of accomplishing.
In arguing that Mangini’s report was unreliable, Theresa points to one alleged error relating to his calculation of a credit to Leslie in the amount of $17,967 for payments he made towards a timeshare in Lake Tahoe, including a $14,836 payment toward an outstanding loan on the timeshare. According to Theresa, Mangini erred by crediting Leslie with paying off the $14,836 loan on the timeshare and with making the monthly payments on the loan that led to the payoff, thus resulting in a double credit. But Theresa points to no place in the final judgment or statement of decision where such double credit was actually awarded to Leslie, and we have found none. Moreover, as Leslie points put, Mangini testified initially that he may have granted Leslie a double credit in his report. But Mangini later testified that Leslie would receive the double credit only if the trial court were to find the timeshare was Leslie’s separate property; the trial court, however, found the timeshare was community property. While Mangini’s testimony on this point was far from clear, given the apparent conflict in evidence, we presume, as the law requires, that the judgment was correct in this regard. (In re Marriage of Ananeh-Firempong (1990) 219 Cal.App.3d 272, 278-279.)
K. Reimbursing Leslie for Child Support Add-ons.
Theresa contends the trial court erred in ordering reimbursement to Leslie in the amount of $26,890.70 for expenses he paid on behalf of the children from 2001 to 2004. She does not challenge the trial court’s earlier order that the parties share equally the child support add-on expenses.
Theresa acknowledges that a trial court’s decisions regarding child support add-ons are reviewed only for abuse of discretion. (§ 4062, subd. (b); In re Marriage of Schlafly (2007) 149 Cal.App.4th 747.) Theresa claims, however, the expenses in this case were “unsupported” and violated the parties’ earlier stipulation requiring approval for any add-on exceeding $500 and barring add-ons totaling over $800 in a single month. Theresa further claims the trial court should have made a finding with respect to her ability to pay before ordering the reimbursement.
We conclude the trial court acted within its discretion in awarding reimbursement to Leslie in the amount of $26,890 for child support add-ons. Mangini testified that he calculated the total of $26,890.70 for the add-ons based on documents – including cancelled checks and invoices – submitted by Leslie. In addition, Leslie testified that he spent that amount on the children during the period of 2001 through 2004. Further, Theresa has pointed to no evidence proving that Leslie violated any stipulation governing the amount of add-on expenses, or that she is unable to pay for them. Nor does she challenge the trial court’s earlier decision to charge both parties equally for such expenses. We thus proceed to the next argument.
IV. Alleged Violation of Theresa’s Right to Due Process.
Theresa contends the trial court violated her right to due process by not permitting her to offer into evidence her answers to certain interrogatories on the ground that she had used all the time allotted to her at trial to present her case. We disagree.
The relevant facts are as follows. Trial was initially held in this matter on November 19, 2004. At that time, Mangini was sworn in as a witness and his report was admitted into evidence, but his testimony was not completed because trial was interrupted by a criminal trial that had calendar preference. Nonetheless, the parties were subsequently able to resolve several issues by stipulation, including issues related to the division of certain stock, dividends and other property.
Trial was again called on January 23, 24 and 25, 2006, at which time the remaining issues were heard. Before the start of trial on January 23, 2006, the trial court permitted each party to file declarations in lieu of live testimony. Both parties complied, with Leslie’s declaration totaling 14 pages and Theresa’s totaling 10 pages. The trial court also permitted each party to submit numerous trial exhibits, with Theresa’s exhibits alone totaling over 70 pages.
Given these lengthy evidentiary submissions, the trial court set aside just two and a half days for the presentation of other evidence in this case, to be shared equally by the parties. In doing so, the trial court noted that the case had been pending over seven years, and had been continued several times. Neither party objected to this ruling.
At the January 2006 trial, Mangini, Theresa and Leslie appeared as witnesses. As previously mentioned, Mangini’s report had been received into evidence in November 2004. At the 2006 trial, Mangini thus offered some updated and revised schedules to his report regarding the division of property. The parties spent approximately one-and-a-half days cross-examining Mangini on his findings.
On the morning of January 25, the trial court advised the parties that Leslie had used just under four hours of his allotted time, and thus had two hours remaining, and that Theresa had used just under five hours of her allotted time, and thus had one hour remaining. Theresa’s attorney then asked the trial court for additional time, anticipating that one hour would be insufficient to finish her presentation of evidence. The trial court denied her request, stating again that the case had been pending over seven years and that the parties had been informed of the time limitations in advance of trial.
When Theresa had exhausted her remaining time, the trial court gave her an additional ten minutes to complete her examination, after which the trial court called on Leslie to begin his cross-examination of Theresa. During this cross-examination, Theresa’s attorney sought to offer into evidence her answers to certain interrogatories relating to Leslie’s alleged breach of fiduciary duty. Leslie’s attorney responded that he had several objections to such evidence. The trial court declined to admit the answers or to hear the objections, advising Theresa’s attorney: “Your time is past.”
In June 2006, the trial court issued a tentative statement of decision. Both parties then submitted lengthy objections to the tentative decision, and responses to such objections, which the trial court considered and ruled upon before rendering its final statement of decision and judgment in January 2007.
In arguing that her due process rights were violated under these circumstances, Theresa relies on a recent decision from our colleagues in the Third Appellate District, In re Marriage of Carlsson (2008) 163 Cal.App.4th 281. There, the appellate court reversed a decision in a marriage dissolution case on due process grounds, without assessing actual prejudice, under the following circumstances. (Id. at pp. 294-295.) The trial had been set for two days, but on the first full day of trial, March 2, the trial court advised the parties the matter was to be completed by noon the following day, or he would declare a mistrial, because he had scheduled the continuance of another trial that had statutory preference. (Id. at p. 286.) The next day, March 3, a half day of trial was held. On the third day, March 9, when the trial extended until late afternoon, the trial court abruptly ended the trial, before the husband had finished presenting his case-in-chief or had offered rebuttal evidence, and while the husband’s expert witness was on the stand and the husband’s attorney was asking him a question. (Id. at pp. 284, 289, 292) The trial court thereafter issued a written decision, ruling against the husband on nearly all issues. (Id. at p. 290.)
In reversing that decision, the appellate court held: “ ‘Refusal to permit counsel . . . to present evidence and make a reasonable argument in support of his client’s position [i]s not a mere error in procedure. It amount[s] to a deprival of a substantial statutory right . . . ’ (Spector v. Superior Court (1961) 55 Cal.2d 839, 843-844 [13 Cal.Rptr. 189, 361 P.2d 909] (Spector).)” (In re Marriage of Carlsson, supra, 163 Cal.App.4th at p. 284.)
While we agree fully with the appellate court’s holding in In re Marriage of Carlsson, supra, 163 Cal.App.4th 281, we conclude it has no application here. Unlike in that case, Theresa had a full and fair opportunity to present her case. As set forth above, Theresa had ample opportunity to cross-examine both the expert witness, Mangini, and Leslie, and to testify on her own behalf. In addition, Theresa was permitted to present substantial documentary evidence in the form of declarations in lieu of live testimony and numerous exhibits. She was also permitted to submit and have considered objections to the trial court’s tentative statement of decision and responses to Leslie’s objections to such statement. While the trial court did impose time constraints with regard to the presentation of evidence at trial, those constraints were not unreasonable given the length of time the case had been pending and the parties’ advance notice of them.
Under these circumstances, we reject Theresa’s due process challenge.
V. Failing to Sanction Leslie for Breach of Fiduciary Duty.
In her final argument, Theresa contends the trial court erred in finding that each party had breached the fiduciary duties he or she owed the other pursuant to sections 721 and 1100, and, on that basis, declining to sanction either party pursuant to section 1101, subdivision (g).
Because this presents an issue of statutory interpretation, our review is de novo. (In re Marriage of Hokanson (1998) 68 Cal.App.4th 987, 992.) To the extent, however, Theresa challenges the trial court’s factual findings with respect to its application of statutory law, we apply the substantial evidence rule and review only for abuse of discretion. (In re Marriage of Quay (1993) 18 Cal.App.4th 961, 972; see In re Marriage of Feldman (2007) 153 Cal.App.4th 1470, 1478 [applying an abuse of discretion standard of review to an order for sanctions under section 2107, subdivision (c), which imposes certain mandatory duties of disclosure on parties in marriage dissolution proceedings].)
Sections 721 and 1100 impose upon spouses certain fiduciary duties to each other with respect to the management and control of community property. (§§ 721, subd. (b), 1100, subd. (e).) Where, as here, a spouse has breached his or her fiduciary duty to the other spouse in a manner not displaying fraud, malice, or oppression (see Civ. Code, § 3294), section 1101, subdivision (g), governs the applicable remedies. Under that provision, “Remedies for breach of the fiduciary duty by one spouse, including those set out in Sections 721 and 1100, shall include, but not be limited to, an award to the other spouse of 50 percent, or an amount equal to 50 percent, of any asset undisclosed or transferred in breach of the fiduciary duty plus attorney’s fees and court costs.” (§ 1101, subd. (g).)
Such fiduciary duties include the “ ‘obligation to make full disclosure to the other spouse of all material facts and information regarding the existence, characterization, and valuation of all assets in which the community has or may have an interest and debts for which the community is or may be liable, and to provide equal access to all information, records, and books that pertain to the value and character of those assets and debts, upon request.’ (§ 1100, subd. (e).)” (In re Marriage of Feldman, supra, 153 Cal.App.4th at p. 1476.)
Here, the trial court found that both parties had breached their fiduciary duties to each other during the pendency of this case by, among other things, unilaterally taking community funds and other property, failing to disclose relevant information in a timely manner, and selling community assets without court authorization. The trial court further found that Mangini’s analysis had accounted for these impermissible transactions and had, despite them, made both parties whole to the extent possible. As such, the trial court declined, in the interests of justice, to impose additional sanctions under section 1101, subdivision (g), against either party. We conclude the trial court’s decisions in this regard were proper.
We need not spend much time on Theresa’s claim that the trial court erred in finding that she breached the fiduciary duties she owed to Leslie. Substantial evidence proved otherwise. For example, Leslie testified that, during the course of this litigation, he discovered Theresa had withdrawn funds from community accounts without his knowledge or consent. Such withdrawals included $10,000 and $5,000 from a joint Charles Schwab account, and $10,000 from a community property equity line. Further, Theresa herself admitted at trial that she had emptied the contents of a community property safety deposit box without Leslie’s knowledge or consent. As such, Theresa’s denial of any breach is not credible.
This is not to suggest, however, that Leslie complied with the fiduciary duties he owed to Theresa. Indeed, Leslie admits to this Court that he did not. It is this mutual noncompliance with the parties’ fiduciary duties that led the trial court to decide to sanction neither party “in the interest of justice” pursuant to section 1101, subdivision (g). We turn now to that decision.
As Theresa points out, our colleagues in the Second District have held that, where a nonmalicious breach of fiduciary duty has occurred, the trial court’s duty to impose sanctions and award attorney’s fees under section 1101, subdivision (g) is mandatory, and refusal to perform it is an abuse of discretion. (In re Marriage of Hokanson, supra, 68 Cal.App.4th at p. 993.) This holding, however, is not applicable here. As we have previously set forth above, section 1101, subdivision (g), states: “Remedies for breach of the fiduciary duty by one spouse . . . shall include . . . an award to the other spouse of 50 percent, or an amount equal to 50 percent, of any asset undisclosed or transferred in breach of the fiduciary duty plus attorney’s fees and court costs . . . ” Here, we have the breach of fiduciary duties by two spouses, not one spouse. As such, mandatory imposition of a sanction is not required under the statutory language.
Moreover, borrowing words from the California Supreme Court, “The exercise of a trial court’s sound discretion [in marriage dissolution matters] is best preserved by maintaining a maximum degree of allowable flexibility.” (In re Marriage of Connolly, supra, 23 Cal.3d at p. 603.) Here, we conclude the trial court properly weighed the equities in declining to sanction either party for his or her breaches of fiduciary duty.
LESLIE’S CROSS-APPEAL
Leslie raises one argument in his cross-appeal – that the trial court erred in apportioning the proceeds of his Wells Fargo 401k plan between community property and separate property. In its final apportionment, the trial court awarded $1,077,183.60 to community property and $308,364.40 to Leslie’s separate property, as of December 31, 2005. According to Leslie, the amount awarded to the community improperly included contributions he made to his 401k plan in 2005, as well as the earnings on those contributions.
Leslie initially raised a second argument in his cross-appeal – that the trial court erred in charging him for certain loan repayments. In his reply brief, however, Leslie abandoned this argument. We thus do not address it here.
In an August 30, 2005 stipulated order, the parties agreed in paragraph 6 that, “[w]ith respect to [Leslie]’s 401k account at Wells Fargo Bank . . ., it is agreed that as of September 30, 2004, [Leslie]’s separate property interest is one of the two amounts set forth below less the amount of $40,000, and the community interest is one of the two amounts set forth, plus the amount of $40,000: (a) [Leslie]’s separate property portion is either $279,604 or $295,213; the community portion is either $889,609 or $874,000.
The parties further agreed in paragraph 7 that, “[w]ith respect to the 401k plan in [Leslie]’s name, once the ratio as determined as set forth in paragraph 6 above of community to separate property has been established, any increases or decreases in the value of the 401k plan not a result of 2005 participant or employer contributions will be shared proportionate to that ratio ([Leslie] has completed all contributions in the year 2004 to the 401k plan so that, provided the ratio of community is established prior to December 31, 2004, all losses and gains can be easily allocated).”
In its tentative statement of decision, the trial court apportioned $1,077,183.60 to the community and $308,364.40 to Leslie from the proceeds of his 401k plan as of December 31, 2005. Leslie objected to this apportionment, advising the trial court that the community’s share of his 401k plan should have been $33,436 less – reflecting his $30,600 contribution to the plan in 2005 and $2,836 in income earned on that contribution.
The trial court implicitly rejected Leslie’s objection, because it made no change to the 401k plan apportionment in its final statement of decision. Further, the trial court expressly stated in the final statement of decision that the apportionment “is based on the higher community portion of the two options to which the parties stipulated ($889,609), plus the $40,000 to which the parties stipulated [as set forth in the August 30, 2005 stipulated order]. The resulting ratio of community to separate property (79.5%), when applied to the December 31, 2005, balance of $1,385,548 (less $30,000 in separate property contributions during 2005, per Exhibit NN), yields the current community portion of $1,077,183.60.”
In the final judgment, to which the final statement of decision is attached as an exhibit, the trial court appears to have corrected a slight mathematical error, calculating $1,077,661 rather than $1,077,183 as the community’s portion of the 401k plan. Leslie fails to explain exactly how the trial court erred in reaching this amount. Moreover, we reach the same amount in performing the calculation described above in the trial court’s statement of decision and using the information contained in exhibit NN. As such, we find no basis for reversing the trial court’s decision in this regard. (In re Marriage of Slivka, supra, 183 Cal.App.3d at p. 162 [“ ‘It is well established that a reviewing court starts with the presumption that the record contains evidence to sustain every finding of fact.’ [Citations.] [Husband’s] contention herein ‘requires [him] to demonstrate that there is no substantial evidence to support the challenged findings.’ (Italics added.) [Citations.]”].)
DISPOSITION
The final judgment is reversed in part. As provided for in this opinion, we remand the matter to the trial court for the limited purposes of: (1) ensuring that Theresa receives an additional $3,800, representing one-half the tax-affected amount of dividends earned on the RSR shares from June 2004 through December 2005; (2) confirming that Theresa was paid for her share of the dividends earned on the benefit restoration program, as valued on a date as near as practicable to the date of trial; and (3) ensuring that Leslie was charged for the $33,457 advance he was found to have received from the community. In all other respects, the final judgment is affirmed. The parties are to bear their own costs on appeal.
We decline Leslie’s request that we further remand to the trial court for reconsideration of the spousal support and attorney’s fees orders.
We concur: McGuiness, P. J., Pollak, J.
“(a) Except as provided in subdivisions (c) and (d) and subject to Article 3 (commencing with Section 3680) and Sections 3552, 3587, and 4004, a support order may be modified or terminated at any time as the court determines to be necessary. . . . [¶ . . . ¶]
“(d) An order for spousal support may not be modified or terminated to the extent that a written agreement . . . specifically provides that the spousal support is not subject to modification or termination.
“(e) This section applies whether or not the support order is based upon an agreement between the parties. . . . ”
“In ordering spousal support under this part, the court shall consider all of the following circumstances:
“(a) The extent to which the earning capacity of each party is sufficient to maintain the standard of living established during the marriage, taking into account all of the following:
“(1) The marketable skills of the supported party; the job market for those skills; the time and expenses required for the supported party to acquire the appropriate education or training to develop those skills; and the possible need for retraining or education to acquire other, more marketable skills or employment.
“(2) The extent to which the supported party’s present or future earning capacity is impaired by periods of unemployment that were incurred during the marriage to permit the supported party to devote time to domestic duties.
“(b) The extent to which the supported party contributed to the attainment of an education, training, a career position, or a license by the supporting party.
“(c) The ability of the supporting party to pay spousal support, taking into account the supporting party’s earning capacity, earned and unearned income, assets, and standard of living.
“(d) The needs of each party based on the standard of living established during the marriage.
“(e) The obligations and assets, including the separate property, of each party.
“(f) The duration of the marriage.
“(g) The ability of the supported party to engage in gainful employment without unduly interfering with the interests of dependent children in the custody of the party.
“(h) The age and health of the parties.
“(i) Documented evidence of any history of domestic violence . . .
“(j) The immediate and specific tax consequences to each party.
“(k) The balance of the hardships to each party.
“(l) The goal that the supported party shall be self-supporting within a reasonable period of time. Except in the case of a marriage of long duration as described in Section 4336, a ‘reasonable period of time’ for purposes of this section generally shall be one-half the length of the marriage. However, nothing in this section is intended to limit the court’s discretion to order support for a greater or lesser length of time, based on any of the other factors listed in this section, Section 4336, and the circumstances of the parties.
“(m) The criminal conviction of an abusive spouse shall be considered in making a reduction or elimination of a spousal support award in accordance with Section 4325.
“(n) Any other factors the court determines are just and equitable.”