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Terry v. Brewster

California Court of Appeals, Sixth District
Feb 27, 2008
No. H031146 (Cal. Ct. App. Feb. 27, 2008)

Opinion


JOANN TERRY, as Successor in Interest, etc. Respondent, v. LEILANI B. BREWSTER, Appellant SAN JOSE POLICE AND FIRE DEPARTMENT RETIREMENT PLAN, Intervener and Respondent. H031146 California Court of Appeal, Sixth District February 27, 2008

NOT TO BE PUBLISHED

Santa Clara County Super. Ct. No. FL551162

BAMATTRE-MANOUKIAN, ACTING P.J.

Over 20 years after a judgment on reserved issues was entered in her marital dissolution action, appellant Leilani Brewster brought a motion to modify the provision entitling her to a portion of the San Jose Police Department pension payable to her former husband, James Terry. James had died and Brewster sought payment of a portion of the survivor’s benefits, which had not been addressed in the judgment on reserved issues and were being paid to Joann Terry, James’s second wife. Respondent San Jose Police and Fire Department Retirement Plan (Plan) filed opposition. The trial court denied the motion to modify the judgment on reserved issues, agreeing with the Plan that the court lacked jurisdiction to modify the judgment on reserved issues because the parties’ right to retirement benefits had been finally adjudicated and jurisdiction over the retirement benefits had not been expressly reserved.

Hereafter, we will refer to James Terry and Joann Terry by their first names for purposes of clarity and not out of disrespect. (See Rubenstein v. Rubenstein (2000) 81 Cal.App.4th 1131, 1136, fn. 1.)

On appeal, Brewster argues that the trial court was authorized to modify the judgment on reserved issues because (1) she requested enforcement of vested property rights; (2) alternatively, the court has continuing jurisdiction to adjudicate an omitted asset; and (3) the court could apply Family Code section 2610, subdivision (a), which provides that the “court shall make whatever orders are necessary or appropriate to ensure that each party receives the party’s full community property share in any retirement plan . . .,” retroactively to a final judgment in order “to cure a rank injustice.” For reasons that we will explain, we agree that the trial court lacked jurisdiction and therefore we will affirm the order denying Brewster’s motion to modify the judgment on reserved issues.

All further statutory references are to the Family Code unless otherwise indicated.

II. FACTUAL AND PROCEDURAL BACKGROUND

A. The Judgment on Reserved Issues

Leilani Brewster and James Terry were married in 1963. Their marriage ended on November 29, 1984, pursuant to the status-only judgment of dissolution entered on January 25, 1985. A judgment on reserved issues was entered on June 12, 1985, which included a provision dividing James’s retirement benefits. James married his second wife, Joann Terry, in 1988. Joann was married to James at the time of his death in 2001.

The January 25, 1985, judgment on reserved issues included the following provision regarding retirement benefits: “C. PENSION. [Brewster] shall be entitled to receive a portion of [James’s] monthly pension fund payments as established through his employment as a police officer with the San Jose Police Department as follows: one-half of the product obtained by multiplying the amount of the benefit, payment, or refund by a fraction whose numerator is two hundred forty seven (247) (the months of community employment from October 5, 1963 to May 7, 1984) and whose denominator is the months of total service credited to [James] on the date of retirement.”

The judgment on reserved issues was silent as to survivor’s benefits and did not include an express reservation of jurisdiction as to retirement benefits or any other issue. Pursuant to the judgment, Brewster received a portion of James’s monthly pension payments after he retired in 1990 from the San Jose Police Department due to a service-connected disability. Brewster continued to receive pension payments after James died on October 3, 2001. The Plan ceased payments to Brewster on February 28, 2003, when the Plan determined that she was not entitled to payment of any benefits after Terry’s death. The Plan has filed a civil collection action against Brewster to recover the pension benefits paid to her after Terry’s death, which total $29,274.

In the opinion filed this day in the companion appeal, (San Jose Police and Fire Retirement Plan v. Brewster (Feb. 27, 2008, H031187) [nonpub. opn.]) we address the merits of the judgment entered in the collection action.

B. The Motion to Modify the Judgment on Reserved Issues

On April 25, 2006, Brewster filed a motion to modify the judgment on reserved issues. In her motion, Brewster stated that the pension plan provided to James by the Plan included survivor’s benefits for the surviving spouse, which the Plan had been paying to James’s second wife, Joann Terry, as the surviving spouse. Brewster further stated that the Plan had ceased payments to her in “March 2003,” and had alleged “that it made payment by mistake and that [Brewster] was not entitled to benefits after the death of [James] under section 2610 of the Family Code.

Brewster sought the following modification of the judgment on reserved issues: “(1) Divide the community interest in each future pension payment as it comes due based on a pro rata share of [James’s] survivor/death benefits, payable directly by the pension plan to [Brewster] and applied retroactively to the date of [James’s] death; (2) Allocate a portion of community contributions to Plan under resulting trust theory.”

The Plan filed opposition to the motion, arguing that Brewster was not entitled to any payments after James’s death under the judgment on reserved issues. Noting that the judgment on reserved issues was silent as to survivor’s benefits, the Plan contended that the judgment should be interpreted under the terminable interest rule that was in effect at the time the judgment was entered. Under the former terminable interest rule, “a community interest in benefits that accrued during the marriage did not extend to pension benefits following the employee spouse’s death. [Citations.]” (In re Marriage of Nice (1991) 230 Cal.App.3d 444, 451.)

The Plan also argued that Brewster was not entitled to payment of benefits after James’s death under the terms of his pension plan as set forth in San Jose Municipal Code section 3.35.1230. The terms of the pension plan provided that James’s disability retirement benefit payments stopped at his death and the Plan was required to pay survivor’s benefits only to the surviving spouse or surviving children. Since Brewster did not qualify as a surviving spouse because she was not married to James at the time of his retirement and at the time of his death, the Plan argued that she could not receive survivor’s benefits.

Further, the Plan asserted the trial court could not order the Plan to pay benefits to Brewster to which she was not entitled because section 2610, subdivision (b) provides that “A court shall not make any order that requires a retirement plan to do either of the following: (1) Make payments in any manner that will result in an increase in the amount of benefits provided by the plan . . . .”

Alternatively, the Plan argued that the trial court lacked jurisdiction to order modification of the judgment on reserved issues because the judgment was final and did not include an express reservation of jurisdiction over any issue. Relying on In re Marriage of Powers (1990) 218 Cal.App.3d 626 (Powers), the Plan contended that the trial court could not apply section 2610, subdivision (a) retroactively to modify a final judgment. In Powers, the appellate court determined that former Civil Code section 4800.8, the predecessor statute to section 2610, could apply retroactively only to those dissolution proceedings in which property rights had not been adjudicated, the adjudication of property rights was subject to appellate review, or the trial court had expressly reserved jurisdiction to divide pension rights. (Id. at p. 645.)

Joann, the surviving spouse, also filed opposition to Brewster’s motion to modify the judgment on reserved issues. She argued that the judgment was not subject to modification because James had died, based on the general rule that “[f]ollowing the death of a party, the court is deprived of jurisdiction to make further orders concerning property rights, spousal support, costs or attorney fees.” (In re Marriage of Lisi (1995) 39 Cal.App.4th 1573, 1575.) Additionally, Joann agreed with the Plan that the trial court lacked jurisdiction to modify the pension benefits provision because the judgment on reserved issues did not include a reservation of jurisdiction over pension benefits. She also agreed with the Plan that section 2610, subdivision (a) could not be applied retroactively to modify a final judgment, observing that section 2610 did not expressly provide for its retroactive application to final judgments.

Brewster filed a reply to the opposition to her motion to modify the judgment on reserved issues, in which she argued that for several reasons the trial court had jurisdiction to modify the retirement benefits provision of the judgment despite its finality. First, Brewster contended that the trial court was authorized to make orders to enforce rights that had already been adjudicated, such as the retirement benefits at issue here. Brewster also contended that she had acquired a vested right to a pro rata share of survivor’s benefits pursuant to section 2610, since that section provides that it applies retroactively to payment of retirement benefits to a person who, like James, died after January 1, 1987. (§ 2610, subd. (c).) Alternatively, Brewster argued that the survivor’s benefits constituted an omitted asset, which the trial court had continuing jurisdiction to adjudicate pursuant to section 2556.

Brewster also relied on legislative intent to dispute her opponents’ contention that section 2610 could not be applied retroactively to modify a final judgment. She contended that the public policy favoring the finality of judgments must yield to the legislative objective of curing a “rank injustice” by enacting section 2610 to require division of the community interest in a retirement plan’s survivor benefits.

C. The Trial Court’s Order

In its order of November 23, 2006, the trial court denied Brewster’s motion to modify the judgment on reserved issues. Relying on the decisions in Powers, supra, 218 Cal.App.3d 626, and In re Marriage of Taylor (1987) 189 Cal.App.3d 435, the court determined that “even where a statute is generally deemed to have retroactive application, it can only be retroactively applied in those cases where the division of pension benefits has not been finally adjudicated, or if such a final adjudication has occurred, where the trial court expressly reserved jurisdiction over such benefits.”

Because the judgment on reserved issues was “indisputably a final judgment,” the trial court ruled that “this Court lacks jurisdiction to modify the Pension Judgment under § 2610 because the parties’ rights to retirement benefits were finally adjudicated before the statute’s enactment, and jurisdiction over the retirement benefits was not expressly reserved.”

III. DISCUSSION

On appeal, Brewster argues that the trial court had jurisdiction to modify the judgment on reserved issues because (1) she requested enforcement of vested property rights; (2) alternatively, the court has continuing jurisdiction to adjudicate an omitted asset; and (3) the court could apply section 2610, subdivision (a) retroactively to the final judgment on reserved issues in order “to cure a rank injustice,” consisting of the denial of survivor’s benefits to Brewster although she had a community property interest in James’s retirement plan.

We review an order denying a motion to modify a judgment that includes a division of retirement benefits under the abuse of discretion standard. (In re Marriage of Mansell (1989) 217 Cal.App.3d 219, 226-227.) Our analysis begins with a discussion of section 2610, the current law requiring the division of a community interest in retirement benefits, since retroactive application of section 2610 is Brewster’s primary argument on appeal.

A. Section 2610

This court has previously stated that “[i]n dividing the community estate as part of a marital dissolution, the court must generally effect an equal division. ([§] 2550.)” (In re Marriage of Gray (2007) 155 Cal.App.4th 504, 514, fn. omitted.) This general rule applies to retirement plans, pursuant to section 2610, subdivision (a). (Ibid.)

Section 2610, subdivision (a) provides in pertinent part, “Except as provided in subdivision (b), the court shall make whatever orders are necessary or appropriate to ensure that each party receives the party’s full community property share in any retirement plan, whether public or private, including all survivor and death benefits, including, but not limited to, any of the following: [¶] (1) Order the disposition of any retirement benefits payable upon or after the death of either party in a manner consistent with Section 2550.” (Italics added.) Subdivision (b) of section 2610 provides in pertinent part, “A court shall not make any order that requires a retirement plan to do either of the following: [¶] (1) Make payments in any manner that will result in an increase in the amount of benefits provided by the plan.”

Section 2550 provides, “Except upon the written agreement of the parties, or on oral stipulation of the parties in open court, or as otherwise provided in this division, in a proceeding for dissolution of marriage or for legal separation of the parties, the court shall, either in its judgment of dissolution of the marriage, in its judgment of legal separation of the parties, or at a later time if it expressly reserves jurisdiction to make such a property division, divide the community estate of the parties equally.”

Section 2610 was enacted in 1992 as part of the Family Code, which was intended to create “a unified statutory scheme.” (In re Marriage of Fellows (2006) 39 Cal.4th 179, 183 (Fellows).) Section 2610 continued “former Civil Code Section 4800.8 without change.” (Cal. Law Revision Com. com., 29D West’s Ann. Fam. Code (2004 ed.) foll. § 2610, p. 542.)

As enacted in 1986, former Civil Code section 4800.8 provided, “The court shall make whatever orders are necessary or appropriate to assure that each party receives his or her full community property share in any retirement plan, whether public or private, including all survivor and death benefits, including, but not limited to, either of the following: [¶] (a) Order the division of any retirement benefits payable upon or after the death of either party in a manner consistent with Section 4800. [¶] (b) Order a party to elect a survivor benefit annuity or other similar election for the benefit of the other party, as specified by the court, in any case in which a retirement plan provides for such an election.” (Italics added.)

The Legislature’s intent in enacting former Civil Code section 4800.8 was to abolish the terminable interest rule, which was in effect at the time the judgment on reserved issues was entered in this case in 1985. (Stats.1986, ch. 686, § 2; In re Marriage of Carnall (1989) 216 Cal.App.3d 1010, 1019.) “According to that rule, first, a community interest in benefits that accrued during the marriage did not extend to pension benefits payable following the employee spouse’s death. [Citations.] Second, a non employee spouse’s interest in pension benefits terminated on that person’s death, so that the non employee spouse could not bequeath benefits by will. [Citations.]” (In re Marriage of Nice, supra, 230 Cal.App.3d at p. 451.)

“The terminable interest rule was subject to considerable appellate and academic criticism. [Citation.] Addressing what was perceived to be the major inequity of the rule, then-Justice Kaus wrote in In re Marriage of Peterson (1974) 41 Cal.App.3d 642: ‘We do not believe the rule which we must follow is fair. [Husband’s] pension rights constitute a bundle to which [wife], as a partner in the community during the years of marriage contributed her equal share. Why should she be deprived of her right to any single stick in the bundle? [Citation].’ [Citation.]” (Powers, supra, 218 Cal.App.3d at p. 635.) “It appears, therefore, that the overriding purpose of section 4800.8 was to rectify a state of law considered unjust.” (Id. at p. 636.)

B. Analysis

1. Retroactive Application of Section 2610

Brewster argues that the trial court has jurisdiction to modify the judgment on reserved issues, despite its finality, because section 2610 may be applied retroactively to allow modification of a final judgment that failed to provide for division of the community interest in survivor’s benefits. For several reasons, we disagree that section 2610 may be applied retroactively under the circumstances of this case.

First, there is a strong public policy favoring the finality of judgments. (In re Marriage of Stevenot (1984) 154 Cal.App.3d 1051, 1071.) The California Supreme Court has stated, with respect to property division, that “[a]n interlocutory decree which does not expressly reserve jurisdiction to divide property at a later date (see [former] Civ.Code, § 4800 [now generally § 2550)]), but instead renders a present division of property, if not challenged by appeal becomes a final and conclusive adjudication of the property rights of the parties. [Citation.]” (In re Marriage of Brown (1976) 15 Cal.3d 838, 851.)

Thus, as one commentator has noted, “Marital property rights and obligations adjudicated by a final judgment cannot be upset by subsequent efforts to ‘modify’ the judgment. [¶] The sole remedy with respect to a judgment adjudicating a property division is a timely set-aside motion under [section] 473(b) . . ., a timely appeal or, after the time for [section] 473(b) relief expires, a [section] 2120 et seq. set-aside proceeding on statutorily-prescribed grounds and within statutorily-prescribed time limits . . . .” (Hogoboom & King, Cal. Practice Guide: Family Law (The Rutter Group 2007) ¶ 17:340, p. 18-83; see also In re Marriage of Heggie (2002) 99 Cal.App.4th 28, 32-33; In re Marriage of Rosevear (1998) 65 Cal.App.4th 673, 684.)

Code of Civil Procedure section 473, subdivision (b), provides in pertinent part, “The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect.”

Section 2122 provides, “The grounds and time limits for a motion to set aside a judgment, or any part or parts thereof, are governed by this section and shall be one of the following: [¶] (a) Actual fraud where the defrauded party was kept in ignorance or in some other manner was fraudulently prevented from fully participating in the proceeding. An action or motion based on fraud shall be brought within one year after the date on which the complaining party either did discover, or should have discovered, the fraud. [¶] (b) Perjury. An action or motion based on perjury in the preliminary or final declaration of disclosure, the waiver of the final declaration of disclosure, or in the current income and expense statement shall be brought within one year after the date on which the complaining party either did discover, or should have discovered, the perjury. [¶] (c) Duress. An action or motion based upon duress shall be brought within two years after the date of entry of judgment. [¶] (d) Mental incapacity. An action or motion based on mental incapacity shall be brought within two years after the date of entry of judgment. [¶] (e) As to stipulated or uncontested judgments or that part of a judgment stipulated to by the parties, mistake, either mutual or unilateral, whether mistake of law or mistake of fact. An action or motion based on mistake shall be brought within one year after the date of entry of judgment. [¶] (f) Failure to comply with the disclosure requirements of Chapter 9 (commencing with Section 2100). An action or motion based on failure to comply with the disclosure requirements shall be brought within one year after the date on which the complaining party either discovered, or should have discovered, the failure to comply.”

In the present case, Brewster does not seek relief from the judgment on reserved issues under Code of Civil Procedure section 473, subdivision (b), or section 2120, et seq. Brewster instead argues that modification of the judgment on reserved issues is authorized because section 2610 expressly provides for retroactive application and is intended to cure the injustice of the terminable interest rule.

We are not persuaded that an intervening change in the law, consisting of the abolishment of the terminable interest rule and the enactment of former Civil Code section 4800.8 and its successor, section 2610, confers jurisdiction on the trial court to modify the retirement benefits provision of the final judgment on reserved issues. When former Civil Code section 4800.8 was amended in 1988, the Legislature stated, “It is the intent of the Legislature that this act apply to all public retirement benefits in which there is an undivided community property interest and in all dissolution of marriage or legal separation cases which are pending on the effective date of this act or in which the court has reserved jurisdiction over the benefit or not yet awarded the benefit.” (Stats.1988, ch. 542, §§ 8 & 9.) (Italics added.)

Thus, “[former Civil Code] section 4800.8, as originally enacted, applies to all cases not finally decided as of its January 1, 1987, operative date. [Citations.] [S]uch retroactive application would not result in an unconstitutional impairment of vested property rights because the statute was designed to cure injustices in the former law and to promote the state interest in equitable division of community property. [Citation.]” (In re Marriage of Colvin (1992) 2 Cal.App.4th 1570, 1576.) This ruling was consistent with section 4, which governs the retroactive application of statutory amendments in family law cases. “[B]y its terms, section 4, subdivision (c), establishes that amendments to the Family Code apply retroactively unless otherwise provided by law.” (Fellows, supra, 39 Cal.4th at p. 186; Velez v. Smith (2006) 142 Cal.App.4th 1154, 1170.)

Section 4 provides in pertinent part, “(b) This section governs the application of the new law except to the extent otherwise expressly provided in the new law. [¶] (c) Subject to the limitations provided in this section, the new law applies on the operative date to all matters governed by the new law, regardless of whether an event occurred or circumstance existed before, on, or after the operative date, including, but not limited to, commencement of a proceeding, making of an order, or taking of an action. [¶] (d) If a document or paper is filed before the operative date, the contents, execution, and notice thereof are governed by the old law and not by the new law; but subsequent proceedings taken after the operative date concerning the document or paper, including an objection or response, a hearing, an order, or other matter relating thereto is governed by the new law and not by the old law. [¶] (e) If an order is made before the operative date, or an action on an order is taken before the operative date, the validity of the order or action is governed by the old law and not by the new law. Nothing in this subdivision precludes proceedings after the operative date to modify an order made, or alter a course of action commenced, before the operative date to the extent proceedings for modification of an order or alteration of a course of action of that type are otherwise provided in the new law. [¶] . . . [¶] (g) If the new law does not apply to a matter that occurred before the operative date, the old law continues to govern the matter notwithstanding its repeal or amendment by the new law. [¶] (h) If a party shows, and the court determines, that application of a particular provision of the new law or of the old law in the manner required by this section or by the new law would substantially interfere with the effective conduct of the proceedings or the rights of the parties or other interested persons in connection with an event that occurred or circumstance that existed before the operative date, the court may, notwithstanding this section or the new law, apply either the new law or the old law to the extent reasonably necessary to mitigate the substantial interference.”

Therefore, since (1) Brewster’s marital dissolution action was finally decided prior to January 1, 1987, (2) the 1985 judgment on reserved issues did not include a reservation of jurisdiction over retirement benefits, and (3) the judgment on reserved issues was final, we find that section 2610, the successor statute to former Civil Code section 4800.8, may not be applied retroactively to allow modification of the judgment. Our reasoning is consistent with the decisions that have allowed retroactive application of former Civil Code section 4800.8 to modify a final judgment. Where the trial court expressly reserved jurisdiction over retirement benefits, the appellate courts have upheld the retroactive application of former Civil Code section 4800.8 to allow modification of a final judgment to ensure that the non employee spouse receives a full and fair community share of the employee spouse’s retirement plan. (In re Marriage of Nice, supra, 230 Cal.App.3d at pp. 452, 453; Powers, supra, 218 Cal.App.3d at p. 641; In re Marriage of Taylor, supra, 189 Cal.App.3d at p. 443.)

Brewster nevertheless contends that even though the judgment on reserved issues is final and does not include a reservation of jurisdiction over retirement benefits, the judgment may be modified in accordance with section 2610 because that section is expressly made retroactive where, as here, the employee spouse died after 1987. Brewster relies upon the following statutory language: “This section shall not be applied retroactively to payments made by a retirement plan to any person who retired or died prior to January 1, 1987 . . . .” (§ 2610, subd. (c).)

We find no merit in Brewster’s interpretation of the retro activity provision of section 2610, subdivision (c). As we have noted, section 2610 continued former Civil Code section 4800.8 without change. (Cal. Law Revision Com. com., 29D West’s Ann. Fam. Code (2004 ed.) foll. § 2610, p. 542.) We accordingly have construed subdivision (c) of section 2610 to provide, as did former Civil Code section 4800.8, for retroactive application to all cases not finally decided as of January 1, 1987. Therefore, since the judgment on reserved issues became final prior to January 1, 1987, and did not include a reservation of jurisdiction, the judgment cannot be modified by retroactive application of section 2610.

Moreover, Brewster’s reliance on the decision in In re Brown (1978) 78 Cal.App.3d 647 (Brown) for the proposition that the final judgment rule must yield to the retroactive application of a statute intended to “cure a ‘rank injustice’ ” is misplaced. The appellate court in Brown determined that Penal Code section 1170.2 could be applied retroactively to a defendant whose conviction was final before that statute’s operative date. (Brown, supra, 78 Cal.App.3d at pp. 650-653.) The Brown court agreed with the decision in Way v. Superior Court (1977) 74 Cal.App.3d 165, 180 that “ ‘final judgments will be reduced only as an incident of a major and comprehensive reform of an entire penal system.’ ” (Brown, supra, 78 Cal.App.3d at p. 652.) Thus, the Brown decision does not aid Brewster because it has no application to a marital dissolution action.

We also observe that the Legislature knows how to make a statute apply retroactively to final judgments when it wishes to do so. Prior to 1981, California courts treated non-disability military retirement benefits as community property. (In re Marriage of McDonough (1986) 183 Cal.App.3d 45, 48 (McDonough).) But in 1981 the United States Supreme Court held in McCarty v. McCarty (1981) 453 U.S. 210 that such military retirement benefits could not be treated as community property under state law. After a public outcry, Congress enacted the Federal Uniformed Services Former Spouses Protection Act (FUSFSPA), 10 U.S.C. § 1408, which provided that states could treat military pension benefits as either the property of both spouses or the separate property of the military spouse. (McDonough, supra, 183 Cal.App.3d at p. 49.)

Due to the effective date of FUSFSPA, an 18-month “ ‘window period’ ” resulted in which the McCarty case remained the “supreme law of the land” despite the enactment of FUSFSPA. (McDonough, supra, 183 Cal.App.3d at p. 49.) The California Legislature responded by enacting former Civil Code section 5124. In pertinent part, former Civil Code section 5124, subdivision (a) provided, “(a) Community property settlements, judgments, or decrees that became final on or after June 25, 1981, and before February 1, 1983, may be modified to include a division of military retirement benefits payable on or after February 1, 1983, in a manner consistent with federal law and the law of this state as it existed before June 26, 1981, and as it has existed since February 1, 1983.”

Thus, we believe that had the Legislature intended section 2610 and its predecessor, former Civil Code section 4800.8, to be applied retroactively to final judgments, the Legislature would have expressly provided for such retrospective operation. Since the Legislature did not do so, and Brewster does not point to any decisions holding that section 2610 may be applied retroactively to modify the retirement benefits provision of a final judgment absent a reservation of jurisdiction, we remain convinced that the judgment on reserved issues cannot be modified by retroactive application of section 2610, subdivision (a) because the judgment became final prior to January 1, 1987, and did not contain a reservation of jurisdiction over retirement benefits.

2. Omitted Asset

Brewster also contends the trial court had continuing jurisdiction under section 2556 to adjudicate the survivor’s benefits because that asset was omitted from the judgment on reserved issues.

Section 2556 provides, “In a proceeding for dissolution of marriage, for nullity of marriage, or for legal separation of the parties, the court has continuing jurisdiction to award community estate assets or community estate liabilities to the parties that have not been previously adjudicated by a judgment in the proceeding. A party may file a post judgment motion or order to show cause in the proceeding in order to obtain adjudication of any community estate asset or liability omitted or not adjudicated by the judgment. In these cases, the court shall equally divide the omitted or unadjudicated community estate asset or liability, unless the court finds upon good cause shown that the interests of justice require an unequal division of the asset or liability.”

We do not agree that the survivor’s benefits provided by James’s retirement plan constitute an omitted asset within the meaning of section 2556. “Under California law, a spouse’s entitlement to a share of community property arises at the time the property is acquired. ([Former] Civ. Code, §§ 5107, 5108, 5110 [now § 770].)” (Henn v. Henn (1980) 26 Cal.3d 323, 330.) Here, Brewster never acquired a community interest in the survivor’s benefits because, as we have discussed, the terminable interest rule was in effect at the time the judgment on reserved issues was entered in 1985. Under the terminable interest rule, a non employee spouse had no community share in benefits payable after the employee spouse’s death. (In re Marriage of Nice, supra, 230 Cal.App.3d at p. 451.) Consequently, the survivor’s benefits at issue in the present case did not exist as a community asset that could have been adjudicated at the time the judgment on reserved issues was entered. The trial court therefore did not obtain continuing jurisdiction over the survivor’s benefits under section 2556.

3. Enforcement of Vested Property Rights

Finally, Brewster advances the alternative argument that the judgment on reserved issues may be modified in accordance with section 2610, subdivision (a) to allocate survivor benefits to her because she seeks the adjudication of a vested property right.

Brewster acknowledges the general rule that “[f]ollowing the death of a party, the court is deprived of jurisdiction to make further orders concerning property rights, spousal support, costs or attorney fees.” (In re Marriage of Lisi, supra, 39 Cal.App.4th at p. 1575.) However, she relies on the exception to that rule: “The court retains jurisdiction . . . to take action to enforce rights adjudicated prior to the death of a party.” (Id. at pp. 1575-1576.) According to Brewster, the trial court adjudicated the parties’ retirement benefit rights and therefore those rights, including the right to survivor’s benefits, can be enforced after James’s death.

We find no merit in this argument. As discussed above, the trial court could not have adjudicated Brewster’s right to her share of the community interest in the survivor’s benefits because no such community share existed in 1985. Therefore, the trial court did not retain jurisdiction to enforce Brewster’s interest in the survivor’s benefits because that right was never adjudicated.

Brewster relies on the decision in In re Marriage of Becker (1984) 161 Cal.App.3d 65 (Becker), but that decision does not aid her. In Becker, the appellate court determined that a former spouse was entitled to a community share of the survivor’s benefits that were being paid to the surviving spouse, and ordered the imposition of a resulting trust on a portion of the survivor’s benefits received by the surviving spouse. (Id. at p. 77-78.) However, Becker is distinguishable because the trial court in that case had reserved jurisdiction over the retirement benefits. The appellate court noted that “[t]he amended interlocutory judgment of dissolution of marriage . . . did not purport to dispose of the retirement benefits; rather, it provided in relevant part: ‘The Court will reserve jurisdiction over Respondent’s [the decedent’s] Retirement Benefits and any other assets not disposed of herein.’ ” (Id. at p. 68, fn. omitted.) Therefore, Becker does not stand for the proposition that the adjudication of retirement rights under the terminable interest rule allows subsequent enforcement of a party’s right to survivor’s benefits by way of modification of a final judgment absent a reservation of jurisdiction.

For these reasons, the trial court lacked jurisdiction to modify the judgment on reserved issues as requested by Brewster and we conclude that the trial court did not abuse its discretion in denying her modification motion.

IV. DISPOSITION

The order of November 23, 2006, denying the motion to modify the judgment on reserved issues is affirmed. Each party shall bear its own costs on appeal.

WE CONCUR: MIHARA, J., MCADAMS, J.

“[T]he term ‘new law’ describes either the enactment of the Family Code itself, or future modifications of the code. [Citation.] The term ‘old law’ refers to the law in effect before the Family Code was adopted. [Citation.]” (Fellows, supra, 39 Cal.4th at p. 186, fn. omitted.)


Summaries of

Terry v. Brewster

California Court of Appeals, Sixth District
Feb 27, 2008
No. H031146 (Cal. Ct. App. Feb. 27, 2008)
Case details for

Terry v. Brewster

Case Details

Full title:JOANN TERRY, as Successor in Interest, etc. Respondent, v. LEILANI B…

Court:California Court of Appeals, Sixth District

Date published: Feb 27, 2008

Citations

No. H031146 (Cal. Ct. App. Feb. 27, 2008)

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