Opinion
D071315
12-18-2017
MANUEL DE JESUS LOPEZ, SR., Plaintiff and Respondent, v. LISETTE LOPEZ et al., Defendants and Appellants.
Rodney T. Gould for Defendant and Appellant. Law Offices of Joseph Shemaria and Joseph Shemaria for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super. Ct. No. ECU08617) APPEAL from a judgment of the Superior Court of Imperial County, L. Brooks Anderholt, Judge. Affirmed. Rodney T. Gould for Defendant and Appellant. Law Offices of Joseph Shemaria and Joseph Shemaria for Plaintiff and Respondent.
This appeal arises out of a quiet title dispute between family members. Defendants and appellants Julie Lopez, Lisette Lopez, and Manuel de Jesus Lopez, Jr. (Appellants) appeal from a judgment quieting title to a residential property in favor of Plaintiff and Respondent, Manuel de Jesus Lopez, Sr. (Respondent). Appellants contend they are entitled to a one-half interest in the property because Rosa E. Serna (Rosa), Respondent's estranged wife, executed a grant deed to Appellants for the property. We conclude the grant deed from Rosa to Appellants was ineffective because it violated the fiduciary duty provisions between spouses that are recognized by Family Code sections 1101 and 1102. Accordingly, we affirm the judgment.
All further statutory references are to the Family Code unless otherwise noted.
FACTUAL AND PROCEDURAL HISTORY
The record presented to this court is by way of a settled statement as to the facts and evidence presented. (Cal. Rules of Court, rule 8.137.) According to the settled statement, Respondent and Rosa were married in approximately 1996. As shown in the Exhibit A deed admitted into evidence, Rosa and Respondent purchased the residence at 225 San Felipe Drive, Imperial, California in 2006. Rosa and Respondent took title as husband and wife as joint tenants.
The Exhibit A, B and C deeds refer to 225 San Felipe Drive, Imperial, California and its legal description, lot 98 of Paseo Del Sol, unit 2, phase 2, Imperial, California. Both descriptions will be referred to as the "Property."
The separate statement provides, "[o]n June 20, 2014, Ros[a] E. Serna was terminally ill with non-Hodgkin's Lymphoma and conveyed her interest in the Property to herself, severing the joint tenancy and the community. On the same date, she then conveyed her interest in the Property to [Appellants] with the intention of making a testamentary transfer of her interest in the subject property to her children." (Italics added.)
On June 20, 2014, Rosa executed the Exhibit B deed, from Rosa, "a married woman, who took title as joint tenants with Manuel Lopez as Husband and Wife" to "Rosa Serna, a married woman, as to all her interest" in the Property.
Also on June 20, 2014, Rosa executed the Exhibit C deed. The Exhibit C deed conveys the Property from Rosa, "a married woman," to Appellants. The stipulated facts are that through the Exhibit C deed, Rosa conveyed her interest in the Property to Appellants "with the intention of making a testamentary transfer of her interest in the subject property to her children."
On July 16, 2014, Rosa filed for divorce from Respondent. Respondent did not challenge either of Rosa's two conveyances in the divorce proceeding. Around August 4, 2014, Rosa died intestate. Respondent discovered the existence of the Exhibits B and C deeds around September 1, 2014. In March 2015, Respondent instituted a quiet title and declaratory relief action to nullify Rosa's conveyance of the Property to Appellants.
The trial court considered the exhibits and stipulated facts and took judicial notice of Rosa's dissolution action. (Evid. Code, § 452, subd. (d).) After hearing testimony from Respondent, the court quieted an undivided one-half interest in the Property to Respondent, and quieted the remaining undivided one-half interest to Rosa's estate. The court issued declaratory relief that Appellants are not entitled to any interest in the Property. They appeal.
DISCUSSION
I
STANDARD OF REVIEW
Appellants contend Rosa's Exhibit C deed was a valid testamentary transfer under California case law. Respondent contends the Exhibit C deed to Appellants was invalid because of the operation of section 1102. On appeal, these legal issues are presented on undisputed facts, and we may therefore interpret the documents and the applicable statutory provisions de novo. (Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 799-801.)
The general rule on appeal is that judgments and orders of the lower courts are presumed correct, and prejudicial error must be affirmatively shown. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564.) "In the absence of a contrary showing in the record, all presumptions in favor of the trial court's actions will be made by the appellate court. 'If any matters could have been presented to the court below which would have authorized the order complained of, it will be presumed that such matters were presented.' " (Bennett v. McCall (1993) 19 Cal.App.4th 122, 127.)
The main section under dispute here is section 1102, subdivision (a) which states, "[e]xcept as provided in Sections 761 [property transferred to revocable trust, usually a community-established trust] and 1103 [dealing with an incompetent spouse], either spouse has the management and control of the community real property . . . but both spouses, either personally or by a duly authorized agent, must join in executing any instrument by which that community real property or any interest therein is leased for a longer period than one year, or is sold, conveyed, or encumbered."
II
APPLICABLE LAW: EXHIBIT B DEED
Civil Code section 683.2, subdivision (a)(2) allows one joint tenant to sever that person's interest in jointly held property, without the consent of the other, by executing a written instrument of transfer that shows an intention to sever that joint tenancy.
All property acquired by a married person during marriage is community property. (§ 760.) Married persons can transmute community property but only through a written, express declaration made by both spouses. (§§ 850, 852.)
Section 850 provides in part, "married persons may by agreement or transfer . . . [t]ransmute community property to separate property of either spouse." (§ 850, subd. (a).) Section 852, subdivision (a) provides, "[a] transmutation of real or personal property is not valid unless made in writing by an express declaration that is made, joined in, consented to, or accepted by the spouse whose interest in the property is adversely affected." --------
The first issue is whether Rosa successfully severed the joint tenancy with Respondent. The parties stipulated that Rosa's Exhibit B deed was effective in "severing the joint tenancy." The trial court was justified in concluding the joint tenancy was severed between Rosa and Respondent because Rosa named herself both as grantor and grantee in the Exhibit B deed. However, even assuming the joint tenancy was severed, Rosa and Respondent still held the Property as community property under the presumption for community property held by a spouse under sections 760, 850, and 852.
III
APPLICABLE LAW: EXHIBIT C DEED
The next issue is whether Rosa could convey her own interest in community property through the Exhibit C deed, without Respondent's consent. We first note that the Exhibit C deed appears to convey all the property, not just Rosa's one-half. Read together with the Exhibit B deed, Rosa presumably intended to convey her one-half interest.
Because of their fiduciary duty obligations, "both spouses . . . must join in executing any instrument by which that community real property or any interest therein is leased for a longer period than one year, or is sold, conveyed, or encumbered." (§ 1102, subd. (a).)
A spouse has a claim for breach of fiduciary duty for any conduct "that results in impairment to the claimant spouse's present undivided one-half interest in the community estate." (§ 1101 subd. (a).) A spouse also has a claim for breach of fiduciary duty if one spouse gifts community property, without consent of the other spouse. (§ 1100, subd. (b); 4 Miller & Starr, Cal. Real Estate (4th ed. 2017) § 11:56, p. 11-175 [section 1100 applies to personal property, but the same principles apply to real property].)
Appellants contend Rosa's Exhibit C deed should be recognized as a valid testamentary transfer based on the principles set forth in Trimble v. Trimble (1933) 219 Cal. 340 (Trimble). In Trimble, a husband executed gift deeds to his children, without the consent of his wife. (Id. at p. 343.) Community property law at the time prohibited unilateral transfers of property held equally between husband and wife. (Ibid.) The court declared such unilateral transfers voidable by the wife as to her one-half interest but valid as to the husband's one-half interest. (Id. at p. 347.) Appellants also rely on Dargie v. Patterson (1917) 176 Cal. 714, which held that when a wife challenged a conveyance of property made by her husband, after the husband's death, she was only entitled to recover her one-half interest. (Id. at p. 718.)
Although community property principles have evolved since 1923, it appears that Trimble, supra, 219 Cal. 340, remains good law to the extent that it has been interpreted by Britton v. Hammel (1935) 4 Cal.2d 690 (Britton). In Britton, the husband conveyed community property without the wife's consent. (Id. at p. 691.) The wife objected to the transfers while the husband was still alive. (Ibid.) Britton interprets Trimble as allowing the wife to recover her one-half interest, not the husband's one-half interest, because the husband was entitled to distribute his interest through his will. (Britton, supra, at pp. 691-692.) The court in Britton distinguished its facts from Trimble because the wife in Britton objected to the transfers while the husband was still alive. (Britton, supra, at pp. 691-692.) The court stated, "[t]he husband has no right, prior to death, to give away any of the community property without the wife's consent" and the wife was entitled to the entire community property. (Id. at pp. 692-693.)
In a more recent California Supreme Court case, Droeger v. Friedman, Sloan & Ross (1991) 54 Cal.3d 26 (Droeger) the court discussed and limited the principles set forth in Trimble, supra, 219 Cal. 340. In Droeger, the husband objected to his wife's transfer of community property made without his consent. (Droeger, supra, at p. 30.) The husband objected to the transfer while he and his wife were still married. (Ibid.) The court stated, "[a] transfer of the community real property without both spouses['] consent adversely affects the nonconsenting spouse's interests." (Id. at p. 46.) The court explained that Britton, supra, 4 Cal.2d 690 continues to be consistent with California community property law. That is, spouses hold community property equally, both spouses must consent to conveying community property for any period longer than one year, and a nonconsenting spouse is "entitled to invalidate in its entirety the other spouse's transfer of community real property." (Droeger, supra, at pp. 46-47.)
Appellants argue Rosa's Exhibit C deed should be recognized as a valid testamentary gift under Trimble, supra, 219 Cal. 340. We disagree. Nothing in the Exhibit C deed qualifies it as a testamentary transfer or passes a cognizable interest that is contingent on death. The Exhibit C deed was an attempt to immediately transfer the entire property or Rosa's interest in it.
Under existing law, the Exhibit C deed could not be executed without violating Rosa's fiduciary duty under section 1101. Section 1102 expressly prohibits unilateral transfers made without the consent of the other spouse. The Exhibit C deed to Appellants was voidable because it contravenes California community property law. Existing community property principles explained in Britton, supra, 4 Cal.2d 690 and Droeger, supra, 54 Cal.3d 26, require a finding that Respondent is entitled to his undivided one-half interest in the property. His objections to the transfer, after Rosa's death, were timely because he did not discover the deeds until then. The trial court correctly quieted title to an undivided one-half interest to Respondent.
Because Rosa died without a will, the trial court was also justified in quieting title to a one-half interest in the property to Rosa's estate. The Exhibit C deed did not effectively replace a will.
Finally, Respondent argues on appeal that Rosa's transfers were fraudulent. Under section 1101, subdivision (h) and Civil Code section 3294, the trial court may award the nonconsenting spouse full interest in the property if there is a finding the spouse who breached the fiduciary duty was guilty of oppression, fraud, or malice. On this record, the trial court was not required to reach such fraud issues. Other issues are dispositive on appeal and we need not decide that claim.
In conclusion, the trial court was correct in finding Respondent was entitled to his undivided one-half interest in the Property. The declaratory relief was properly issued to find that Appellants had no interest in the Property, because Rosa's Exhibit C deed did not comply with California community property law pursuant to section 1102. Rosa's intestate estate holds the remaining undivided one-half interest in the property. (Prob. Code, § 6401, subd. (a).)
DISPOSITION
The judgment is affirmed. Costs on appeal to Respondent.
HUFFMAN, J. WE CONCUR:
McCONNELL, P. J.
AARON, J.