Opinion
E073543
04-29-2021
In re the Marriage of DIONNE G. and JOHN R. MADIA. DIONNE G. MADIA, Respondent, v. JOHN R. MADIA, Appellant.
The Appellate Law Firm and Berangere Allen-Blaine for Appellant. Arias & Lockwood and Christopher D. Lockwood for 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NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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. RID1204017) OPINION APPEAL from the Superior Court of Riverside County. Candice Garcia-Rodrigo, Temporary Judge. (Pursuant to Cal. Const., art VI, §21.) Affirmed. The Appellate Law Firm and Berangere Allen-Blaine for Appellant. Arias & Lockwood and Christopher D. Lockwood for Respondent.
In 2014 the family court ordered appellant John R. Madia (Husband) to pay respondent Dionne G. Madia (Wife) spousal support in the amount of $6,927 per month plus 38.4 percent of any income he received in excess of $17,000 per month. In 2018, Husband requested spousal support be eliminated. The family court reduced the amount of spousal support owed by Husband to $4,000 per month. Husband contends the family court erred in modifying the spousal support order because (1) substantial evidence does not support the finding that Husband voluntarily left his job; (2) there was a material change in circumstances due to Husband leaving his job; and (3) substantial evidence does not support the finding that Husband lives at or slightly above the marital standard of living. We affirm the order.
FACTUAL AND PROCEDURAL HISTORY
A. 2014 SPOUSAL SUPPORT ORDER
Husband and Wife married in May 1989. They separated in August 2012. In September 2012, Wife petitioned the family court for dissolution of the marriage and requested an order for spousal support in a reasonable amount to be determined by the court. In September 2012, Wife was 45 years old and Husband was 46 years old. Husband had a 10th grade education and, in 2012, worked as a sales representative for Van Nest & Coleman (Van Nest). Van Nest represented manufacturers of beauty products and sold their products to distributors, who then sold the products to salons. Wife completed high school and had a cosmetology certificate. Wife did not work outside the home during the marriage; she stayed home and raised the couple's two sons who were adults by 2012.
Wife estimated Husband had a monthly income of $27,000, which would be $324,000 annually. Husband opposed Wife's request for spousal support. Husband contended he had an income of $17,000 per month, which would be $204,000 annually.
On April 2, 2014, a judgment only as to status was entered reflecting a marital dissolution date of March 25, 2014. The family court found that Husband had a base monthly income of $17,000 and that he received sporadic bonuses in excess of his base income. Wife had no monthly income. On May 19, 2014, the court ordered Husband to pay spousal support of $6,927 per month plus 38.4 percent of any income he received in excess of $17,000 per month.
B. MODIFICATION OF SPOUSAL SUPPORT
In March 2018, Husband requested spousal support be eliminated. Husband asserted he lost his job on February 19, 2018, due to Van Nest downsizing; he was earning approximately $734.60 per month as an independent contractor; his expenses were $7,453 per month; and he was "essentially living off credit cards." Husband asserted that, at 53 years of age and lacking a high school diploma, his ability to find a job paying $17,000 per month would be limited. Wife opposed Husband's request. Wife contended Husband's employment was not terminated; rather, he resigned and became a silent partner in the business of his second wife, Michelle Madia (Second Wife), and was hiding his income in bad faith.
A two-day trial was held in the family court. The family court found that (1) Husband did not apply for unemployment after his employment with Van Nest was allegedly terminated; (2) Husband did not apply for new employment after allegedly being terminated; (3) Husband did not reduce his expenses, although he claimed to have little income; and (4) Husband actively promoted Second Wife's business. The family court concluded that it was "more likely that [Husband] voluntarily left his employment with [Van Nest] in favor of promoting his and [Second] Wife's business." The family court also found that Husband stopped paying spousal support to Wife in March 2018 despite having the money to make the support payments.
In its statement of decision, the family court noted that, when ruling on a request to modify spousal support, the court can " 'take into account evidence of bad faith on the part of the supporting party in meeting his or her support obligations. Such evidence may justify holding a supporting party to those obligations even if the acts taken in bad faith have ostensibly reduced the supporting party's income.' " The family court found "[Husband] demonstrated his willful intention to avoid his financial obligations to [Wife] by failing to pay her spousal support when he had the funds to do so, and failing to pursue gainful employment diligently and in good faith."
The family court found that Husband's earning capacity was unchanged from the time when Husband was employed by Van Nest. Therefore, the family court found that Husband leaving Van Nest did not constitute a change of circumstance. However, the court found that Husband's monthly income from Van Nest had gradually declined to $13,000. The family court found that reduction in income/earning capacity constituted a material change of circumstances. The court found Husband had the capacity "to continue earning at least $13,000 per month in a managerial position. Thus, the Court impute[d] gross monthly income to [Husband] in the amount of $13,000."
The family court found "[t]he parties shared a middle-class standard of living. [Wife] testified that the parties owned a four-bedroom, two-bathroom single-family residence. The parties did not take many vacations, other than one family trip to Miami, several trips to Las Vegas, and sometimes quarterly vacations to San Diego, California. . . . The parties purchased two Mazdas for their two children, and owned a 2006 Lexus IS350 and a 2010 Mercedes C300 at the date of separation." The family court found Husband and Second Wife owned a home and had $60,000 in equity, and Husband owned a 2017 GMC Yukon. The family court concluded that "[Husband] is currently living at the marital standard of living, if not slightly above."
The family court ordered Husband to pay $4,000 per month in spousal support, retroactive to April 1, 2018. The court calculated the arrears owed for April 2018 to July 2019 as $64,000, and ordered the arrears to be paid at the rate of $1,000 per month.
DISCUSSION
A. RESIGNATION FINDING
Husband contends there is no evidence to support the family court's finding that he likely voluntarily quit his job.
The family court's factual findings must be supported by substantial evidence. Under the substantial evidence standard of review, we resolve all conflicts in favor of the family court's ruling, make all inferences in favor of the family court's ruling, and are bound by the family court's credibility determinations. (In re Marriage of Berman (2017) 15 Cal.App.5th 914, 920 (Berman)).
The party moving to modify spousal support bears the burden of proof. (In re Marriage of Stephenson (1995) 39 Cal.App.4th 71, 77.) Thus, Husband had the burden to prove that Van Nest terminated his employment and that the termination resulted in a material change of circumstances. (Ibid.) Husband's only evidence that Van Nest terminated his employment was Husband's testimony. The family court expressly found that Husband's testimony lacked credibility. We are bound by that credibility finding. (Berman, supra, 15 Cal.App.5th at p. 920.) Therefore, we conclude Husband failed to provide substantial evidence that Van Nest terminated Husband's employment.
Further, the record supports the family court's finding that Husband likely voluntarily quit his job. On cross-examination, Husband was asked if he was laid off or fired from Van Nest. Husband said he "was told [his] services were no longer needed." Husband asserted his employment was terminated over the phone and he received no paperwork pertaining to the termination of the job he held for 13 years. Husband did not apply for unemployment when his job ended. Husband did not submit any job applications after his job ended. Due to the lack of paperwork, failure to apply for unemployment, failure to submit any job applications, and lack of clarity regarding a layoff or firing, the family court could reasonably conclude that Husband was being untruthful concerning the end of his employment with Van Nest.
Second Wife had a business named MRM Beauty (MRM), which was a beauty company focused on fingernails. Husband's employment with Van Nest ended in February 2018. In April 2018, Husband traveled to trade shows in New Jersey, Pennsylvania, and Chicago. In May 2018, Husband traveled to distributor shows in North Carolina and Georgia. The North Carolina show was predominately for fingernail companies. In July 2018, Husband went to Las Vegas for a beauty trade show. Husband spoke to many manufacturers but did not distribute resumes. In August 2018, Husband traveled to New Orleans; Portland, Oregon; Garden Grove; and Las Vegas. In September 2018, Husband traveled to North Carolina and Arlington, Virginia, for trade shows. The trade shows were directly related to MRM's business. Husband told people he was "with MRM Beauty." Husband did not have to register far in advance for trade shows, he explained, "As many years as I have worked in the industry, I can generally get in and out of any show on a very short notice to attend."
In the February 2019 issue of Beauty Store Business, which is a trade magazine, there was a photograph of Husband from a trade show in Las Vegas. Husband was identified as the manufacturer's representative for MRM. In the magazine, Husband was quoted as saying, " 'Looking to 2019, MRM Beauty Sales will continue to concentrate its efforts to by [sic] continuing to only represent nail brands. We feel this focus will help to get the artistry and creativity in the nail category all the attention they deserve. MRM Beauty Sales believes nail art will be better and bigger in the coming year.' " At trade shows, in January 2019, Husband distributed business cards that reflected Husband's name and MRM.
The foregoing evidence supports a finding that Husband was working for MRM. Husband was traveling to trade shows after his employment with Van Nest ended. He did not need to register far in advance for trade shows, suggesting that he had registered for the shows after ceasing to work for Van Nest. Husband told people he worked for MRM; Husband did a media interview promoting MRM; and Husband had business cards indicating he worked for MRM. From this evidence one could reasonably conclude, as the family court did, that "it is more likely that [Husband] voluntarily left is employment with [Van Nest] in favor of promoting his and [Second Wife's] business at industry trade shows throughout the nation."
In support of his assertion that there is a lack of substantial evidence, Husband highlights the evidence that is favorable to him. For example, Husband notes that, prior to his employment with Van Nest ending, Van Nest lost a client that comprised 20 to 30 percent of Van Nest's income. However, "we are bound by the rule that when 'a finding of fact is attacked on the ground that there is not any substantial evidence to sustain it, the power of an appellate court begins and ends with the determination as to hether there is any substantial evidence contradicted or uncontradicted which will support the finding of fact.' " (Gray v. Don Miller & Associates, Inc. (1984) 35 Cal.3d 498, 503.) That there may be some evidence in the record to support a finding contrary to the family court's finding does not alter our conclusion that there is substantial evidence to support the finding.
B. CHANGE OF CIRCUMSTANCES
1. LAW
"To modify spousal support, a trial court must first find ' " 'a material change of circumstances since the last order.' " ' " (In re Marriage of T.C. & D.C. (2018) 30 Cal.App.5th 419, 424.) " 'Change of circumstances means a reduction or increase in the supporting spouse's ability to pay and/or an increase or decrease in the supported spouse's needs.' " (In re Marriage of Dietz (2009) 176 Cal.App.4th 387, 396.) Statutory factors for the court to consider include the parties' earning capacities and marketable skills. (Fam. Code, § 4320, subd. (a); In re Marriage of Stephenson (1995) 39 Cal.App.4th 71, 77-78.) Accordingly, even if an actual change in income is shown, modification of spousal support is not mandated because the court can focus on the parties' earning capacities. However, a court focuses on earning capacity, rather than actual income, "only where the supporting spouse has demonstrated a willful intention to avoid fulfilling familial financial support obligations through deliberate misconduct." (Stephenson, at p. 78; see also Berman, supra, 15 Cal.App.5th at pp. 920-921.)
2. CONTENTION
There are two changes in Husband's income that are relevant. The first is that Husband's income, while employed at Van Nest, decreased from $17,000 per month to $13,000 per month. The family court ultimately modified the spousal support order due to that first change in income. Husband does not challenge either that finding or that modification.
The second is Husband's claim that his income decreased again to less than $1,000 per month after leaving Van Nest. The family court did not modify the support order due to the second claimed change in income. Husband contends the family court erred by finding there was not a material change of circumstances due to him no longer working for Van Nest.
3. FAILURE OF PROOF
Husband bore the burden of proving a material change in circumstances. (In re Marriage of Stephenson, supra, 39 Cal.App.4th at p. 77.) When the party with the burden of proof fails to carry his burden and then appeals, the question on appeal is " 'whether the evidence compels a finding in favor of the appellant as a matter of law. [Citations.] Specifically, the question becomes whether the appellant's evidence was (1) "uncontradicted and unimpeached" and (2) "of such a character and weight as to leave no room for a judicial determination that it was insufficient to support a finding." ' " (Dreyer's Grand Ice Cream, Inc. v. County of Kern (2013) 218 Cal.App.4th 828, 838.)
The family court found Husband's testimony concerning his inability to pay spousal support lacked credibility. Husband presented his 2018 tax returns to corroborate his testimony that he lacked the ability to pay spousal support, but, as the family court noted, "[Husband] testified that his 2018 tax return does not accurately reflect all the funds he received from [Van Nest]." Because Husband's testimony was not credible and his tax return was incomplete, Husband failed to provide evidence of such character and weight to compel a finding that his income decreased to less than $1,000 per month.
4. BAD FAITH
Further, the record supports the family court's finding that Husband acted in bad faith. Husband stopped working for Van Nest in February 2018. From March to November 2018 Husband did not pay any spousal support. In March 2018, Husband had approximately $24,000 in his bank account. Also in March 2018, Husband made a payment of approximately $2,300 for a Caribbean cruise. In April 2018, Husband had over $18,000 in his bank account. In May 2018, Husband had over $13,000 in his bank account. In July 2018, Husband had over $18,000 in his bank account. In August 2018, Husband had approximately $18,000 in his bank account. In September 2018, Husband had over $16,000 in his bank account. In October 2018, Husband had over $10,000 in his bank account. In November 2018, Husband had almost $12,000 in his bank account. Thus, Husband had sufficient money to pay spousal support but did not pay it. Because Husband had the money to pay spousal support, but did not pay it, the family court could reasonably infer he willfully avoided paying spousal support.
Further, given that Husband stopped paying spousal support at the time he stopped working for Van Nest despite having the money to pay support, and that substantial evidence supports the finding Husband voluntarily resigned from Van Nest, one can reasonably conclude that resigning from Van Nest and claiming to be fired or laid off was deliberate misconduct to avoid paying spousal support. Due to the deliberate misconduct, the family court could bypass Husband's actual income and look to his earning capacity.
Husband contends, "No facts exist that is demonstrating [sic] a willful intention to avoid his financial responsibilities." As set forth ante, the evidence showed that Husband did not pay spousal support from March to November 2018 despite having sufficient money in his bank account to make the payments. Husband's failure to pay spousal support when he had the means to do so demonstrates a willful intention to not pay spousal support.
Husband contends the family court "cannot require [Husband] pay spousal support to [Wife] to maintain the marital standard of living if there is no money." Modification of spousal support is not mandated due to a decrease in income if there is "evidence of bad faith on the part of the supporting party in meeting his or her support obligations." (Berman, supra, 15 Cal.App.5th at pp. 920-921.) The evidence of Husband acting in bad faith is (1) Husband had the money to pay spousal support but chose to not pay it; (2) Husband resigned from Van Nest but said he was told "[his] services were no longer needed"; and (3) Husband said he was unemployed but was working for MRM. Due to the evidence of Husband acting in bad faith, the family court could order Husband to pay spousal support based upon his earning capacity despite an actual decrease in his income.
5. EARNING CAPACITY
The record also supports the family court's finding that Husband has an earning capacity of $13,000 per month. Husband began working in the beauty supply industry when he was 15 years old; Husband's family owned a beauty supply company. Husband worked in purchasing for his family's company. After that job, Husband worked for a beauty product distributor for 10 years as a sales representative calling beauty supply stores. After that job, Husband was a sales manager for approximately four years at a hair color company and managed approximately 15 employees. Husband then obtained the job with Van Nest. In 13 years working at Van Nest, Husband established significant relationships with beauty product manufacturers. Husband is "a well-known face in the beauty [products] industry." The beauty products industry "is a very social industry. People tend to do business with people they know."
The foregoing evidence reflects that Husband is likely to succeed in continuing to work in the beauty products industry because (1) people tend to work with who they know; (2) Husband knows many people from his years in the industry; and (3) Husband has decades of experience in selling beauty products.
Joya Mia makes nail products. In late 2018, Husband began working with Joya Mia as a manufacturing representative. Husband was not directly employed by Joya Mia. Husband believed that having Joya Mia as a client would assist him in obtaining more clients. The evidence that Husband was able to obtain a client after leaving Van Nest is evidence of Husband's ability to continue working in the beauty products industry.
Husband holds a two percent interest in Van Nest. Husband did not cash out his interest because, if he did, then he would have to sign a noncompete contract, and he did not want to stop working in the beauty products industry. Husband's desire to continue working in the beauty products industry reflects that he sees a future for himself within the industry.
The foregoing evidence supports the family court's finding that Husband has a strong earning capacity within the beauty products industry. The family court could reasonably conclude from this evidence that Husband has the capacity to continue earning the salary that he was earning when he left Van Nest, which is $13,000 per month.
6. CONCLUSION
In sum, Husband failed to prove that his income fell below $1,000 per month. However, to the extent that his income actually decreased, there is evidence to support the family court's finding that Husband engaged in deliberate misconduct to avoid paying support when he ceased working at Van Nest and that Husband has an earning capacity of $13,000 per month. Therefore, we conclude the family court did not err in finding that a material change of circumstances did not occur when Husband ceased working for Van Nest.
C. MARITAL STANDARD OF LIVING
Husband contends the family court erred by finding that he lives at or slightly above the marital standard of living.
The marital standard of living is one of the statutory factors the family court must consider when determining the amount of support to award. (Fam. Code, § 4320, subd. (d).) "The marital standard of living is 'a general description of the station in life the parties had achieved by the date of separation,' rather than a 'mathematical standard.' " (In re Marriage of McLain (2017) 7 Cal.App.5th 262, 270.) We apply the substantial evidence standard when reviewing the family court's factual findings. (Berman, supra, 15 Cal.App.5th at p. 920.)
At the time of the separation, Husband and Wife had a house in Riverside with four bedrooms and two bathrooms, which was located on a cul-de-sac in a desirable neighborhood. In 2019, Husband had a house near Dallas, Texas with four bedrooms and three bathrooms, and it was located across the street from a lake with dock access. The two houses are comparable in terms of the number of bedrooms and bathrooms. A trier of fact could reasonably find the house in Texas is slightly better because it is near a lake with dock access. Thus, in terms of houses, the evidence supports a finding that Husband was at, or slightly above, the marital standard of living.
In 2012, Husband and Wife had a 2006 Lexus that was fully paid for, a 2010 Mercedes with a car loan, and two Mazdas with car loans for their two sons. Since the divorce, Husband owned four vehicles. In 2019, Husband owned a 2017 GMC Yukon and owed $39,000 on the car loan for the Yukon. Husband's 2019 ownership of a two-year-old Yukon with a car loan is comparable to Husband and Wife's 2012 ownership of a two-year-old Mercedes with a car loan. Thus, in terms of cars, the evidence supports a finding that Husband was at the marital standard of living.
During the 23-year marriage, Husband and Wife traveled once to Miami, several times to Las Vegas, and three to four times a year they went to San Diego. In June 2018, Husband took a cruise to the western Caribbean and visited Cozumel. The trip was for recreation—not a trade show. A Caribbean cruise is comparable, if not slightly better than, a trip to Miami. Thus, in regard to recreation, the evidence supports a finding that Husband was at, or slightly above, the marital standard of living.
In 2012, Husband and Wife had credit card debt. In 2019, Husband had credit card debt. In 2012, Husband and Wife had negative equity in their home in Riverside. In 2019, Husband had a mortgage on his home in Texas and $60,000 in equity. No retirement accounts were accumulated during the marriage. In 2019, Husband still did not have a retirement account. In 2012, Husband held a two percent interest in Van Nest. In 2019, Husband continued to hold a two percent interest in Van Nest. In terms of finances, Husband was at, or slightly above, the marital standard of living because he had $60,000 of equity in a home, rather than negative equity, and all the other finances were essentially the same.
In sum, substantial evidence supports the family court's finding that Husband was at or slightly above the marital standard of living.
D. WEIGHING OF THE FACTORS
In a point heading, Husband contends the family court erred by giving "the same weight to the marital standard of living, even though the couple had been separated for almost 7 years." The discussion underneath that point heading does not address the assertion made in the point heading. Rather, the discussion concludes, "The Commissioner cannot require [Husband] pay spousal support to [Wife] to maintain the marital standard of living if there is no money." Accordingly, the issue raised in the point heading, regarding the weight given to the standard of living factor, is forfeited due to the failure to support it with reasoned legal analysis. (Berger v. California Ins. Guarantee Assn. (2005) 128 Cal.App.4th 989, 1007.)
E. ADEQUACY OF THE RECORD
Wife contends Husband failed to provide an adequate record on appeal due to Husband's failure to have the trial exhibits transmitted to this court. (Cal. Rules of Court, rule 8.224 [transmittal of exhibits].) The record provided by Husband appeared adequate to address Husband's contentions on appeal. (See Osgood v. London (2005) 127 Cal.App.4th 425, 435 [a record is inadequate if it excludes portions that would provide grounds for affirming].) Accordingly, we reached the merits of Husband's contentions despite the lack of exhibits.
DISPOSITION
The order is affirmed. Respondent is awarded her costs on appeal. (Cal. Rules of Court, rule 8.278(a)(1).)
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
MILLER
J. We concur: McKINSTER
Acting P. J. MENETREZ
J.