Vinhas v. Krognes (In re Marriage of Vinhas)

Full title: In re the Marriage of CARLA SOFIA VINHAS and STEVE EDWARD KROGNES. CARLA…

Court: COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION TWO

Date published: Aug 9, 2018

A144387 (Cal. Ct. App. Aug. 9, 2018)

Opinion

A144387 A145262

08-09-2018

In re the Marriage of CARLA SOFIA VINHAS and STEVE EDWARD KROGNES. CARLA SOFIA VINHAS, Appellant, v. STEVE EDWARD KROGNES, Respondent.

Richman, Acting P.J.

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (San Francisco County Super. Ct. No. FDI-12-776789)

Appellant Carla Vinhas and respondent Steve Krognes were married in 1997. During their marriage, Carla was a stay-at-home mother to the couple's two children, while Steve's career in finance was on an upward trajectory.¹ His career reached new heights in 2009, when he was appointed chief financial officer of Genentech, Inc., a position that was rewarded with high compensation. While Steve's career was very successful, the marriage, unfortunately, was not, and Carla petitioned for dissolution in 2012. Over the course of the dissolution proceeding, the marital standard of living for purposes of determining Steve's spousal support obligation would be hotly contested: did it include the astronomical increases in Steve's earnings such that the couple had achieved a very upper class station in life during the marriage (as Carla contended), or did the increases incur during a period of separation such that they did not impact the marital standard of living, which was otherwise very modest (as Steve contended)? In a trial on spousal support, the court decided this and many other issues in Steve's favor, ultimately finding that Carla was already self-supporting at the couple's modest marital standard of living and awarding her spousal support of $5,000 per month for four months.

1 As is common in marital dissolution proceedings, we refer to the parties by their first names.

In the first of these two consolidated appeals, Carla challenges that award on numerous grounds, fundamentally contending that the trial court committed reversible error in concluding she was self-supporting at the marital standard of living. While we disagree with her many arguments that the trial court's findings on the marital standard of living were unsound, we agree with her that the court's finding that she was self-supporting at the couple's modest standard of living was unsupported by substantial evidence.

Carla's second appeal arises out of the trial court's order on her request for modification of the child and spousal support awards, enforcement of the child support order, and pendente lite spousal support pending appeal, and her request for pre-judgment attorney fees and costs, attorney fees for her appeal, and attorney fees for bringing the request for modification itself. We conclude the trial court abused its discretion in denying Carla attorney fees for her request for modification, since she prevailed on three items requested in her motion. In all other regards, there was no error.

We thus affirm in part and reverse in part.

I. APPEAL NO. A144387

A. BACKGROUND

1. The Marriage

Steve Krognes and Carla Vinhas married in Boston on February 10, 1997. At the time, Steve was a student at Harvard Business School and Carla an undergraduate in the Harvard University extension program. In 1998, Steve obtained his master's degree in business administration, and the following year, Carla her bachelor's degree.

In August 1999, after Carla graduated, the couple moved to London to be closer to their families in Norway and Portugal. There, Steve worked as a management consultant, while Carla worked in online advertising.

In the fall of 1999, Carla became pregnant, and the couple decided to move to Norway where Steve's family lived. In April 2000, Steve began work in Norway with Pylonia Ventures, a venture capital firm. The couple's first daughter was born in June 2000, followed by a second daughter in 2002. That same year, Steve left Pylonia Ventures for a position in the mergers and acquisitions department of Danske Bank.

In 2003, Carla decided she wanted to leave Norway, as she was unhappy living there. At the same time, Danske Bank was not performing as Steve had expected, so he began searching for a new job, and at the end of the year Steve moved to Basel, Switzerland to take a position as the head of mergers and acquisitions for Roche Pharmaceutical (Roche). Before leaving Norway for Switzerland, Steve had a "very difficult discussion" with his mother, telling her he was moving to Switzerland because he and Carla were separating.

Steve began his position at Roche in January 2004. Carla and the children remained behind until the children finished their school year, eventually joining him in August 2004. When the family reunited in Basel, Steve and Carla reconciled.

In November 2007, despite efforts to rebuild their marriage, Steve and Carla both realized the marriage was over and agreed to divorce. Steve moved out of their shared bedroom, and Carla informed close friends of the couple's plan to end the marriage. In June 2008, the couple jointly announced to family and friends they were divorcing, and in September, they began a six-month divorce mediation with a Swiss mediator.

Meanwhile, in spring of 2008, Steve began working on Roche's hostile takeover of Genentech, Inc. (Genentech). At the end of March 2009—the day before the Roche/Genentech deal was scheduled to close—Steve was told he was being relocated to the San Francisco Bay Area (where Genentech is headquartered) on one week's notice. Steve moved to the United States at the beginning of April, with the understanding that he and Carla were separated.

By the time of the April 2009 move, Steve and Carla had reached a global divorce settlement in Switzerland (Swiss divorce agreement) but had not yet signed the agreement. Only after Steve's relocation did he learn from the mediator that the Swiss court could not finalize the divorce because he was no longer residing in Switzerland. Consequently, although Steve believed the parties had completed their negotiations, the Swiss divorce agreement was not implemented.

In August 2009, Carla and the children moved to the United States so the children could be near both parents. Steve requested permission from Roche to divide his $8,000 monthly housing allowance so he could rent a separate home for Carla. The request was denied, so "purely for convenience" he rented a large home with four bedrooms in which he and Carla could both live but in separate living quarters. Steve did not file for dissolution in 2009 due to the overwhelming pressures of his job. Additionally, in October, two months after Carla and the children arrived in San Francisco, Carla informed Steve she was moving to Paris to live with her boyfriend with whom she had been involved since 2007, so it did not make sense to him to commence divorce proceedings in the United States.

In June 2010, Carla left San Francisco for Paris, and the children joined her in January 2011. Carla and the children returned to San Francisco in the summer of 2011, and Steve allowed Carla to stay in his house for six weeks while she looked for housing.

Meanwhile, beginning in January 2010, Steve began making monthly support payments to Carla consistent with the Swiss divorce agreement. And on February 27, 2010, the parties signed an agreement in San Francisco regarding spousal and child support and property division (2010 divorce agreement). That agreement incorporated the Swiss divorce agreement, with some amendments.

2. Carla's Petition for Dissolution and Steve's Response

On April 2, 2012, Carla filed a petition for dissolution in San Francisco, identifying October 15, 2011 as the date of separation. She simultaneously filed an order to show cause (OSC) for spousal support, child support, attorney fees, and costs, set for hearing on May 22. As to attorney fees, Carla requested Steve advance her $50,000. She also requested an additional $100,000 should he seek to enforce the 2010 divorce agreement, which Carla claimed was unenforceable "on grounds of breach of fiduciary duty, undue influence and duress."

In her OSC, Carla estimated that Steve's annual income from employment was $2.4 million, exclusive of "stock and other perks," and that his income from other sources and his assets were "millions of dollars." She, on the other hand, had a savings account with an approximate balance of $30,000, stock valued at approximately $28,000, and no access to the parties' community assets.

Carla's OSC was supported by a declaration of her attorney, Samantha Bley DeJean, in which DeJean stated that she anticipated there being substantial difficulty in resolving the case in light of the assets at stake. She requested attorney fees of $50,000 plus $10,000 to $15,000 to retain a forensic accountant, and additional attorney fees should Steve seek to enforce the 2010 divorce agreement.

In an accompanying income and expense declaration (IED), Carla listed her proposed needs as $71,770 per month. This included monthly expenses of $12,000 for rent or a mortgage, $2,500 for property taxes, $2,000 for home maintenance (including $250 for pool service/supplies), $2,000 for childcare to enable her to work, $2,500 for clothing for herself and $1,000 for the children, $3,000 for travel, and $30,000 for savings.

On May 9, Steve filed a response to Carla's petition, identifying the date of separation as "To be determined." He requested the court terminate jurisdiction over spousal support and order both parties to bear their own attorney fees and costs.

3. The Parties' Stipulations and Settlement Regarding Property Claims

On May 22, 2012, the parties stipulated that Steve would advance Carla $175,000 towards his child and spousal support obligations, retroactive to April 2 and subject to later allocation. He also agreed to advance her $37,500 in attorney fees, again subject to later allocation. The stipulation also continued the hearing on Carla's OSC.

On August 28, the parties filed a stipulation concerning temporary child and spousal support. Among the issues resolved by the stipulation, Steve and Carla agreed that commencing April 2, 2012, Steve would pay temporary base spousal support of $14,122 per month through June 30, 2012, then $13,026, and temporary base child support of $6,485 per month through June 30, 2012, then $6,161. Carla was also to receive $27,271 in child support and $92,105 in spousal support from Steve's April 2012 bonus, and a percentage of annual bonuses received after July 1, 2012. Steve also agreed to advance Carla $309,190, representing one-half of the proceeds he received from his July 31, 2012 Performance Share Plan (PSP) award, with the court reserving jurisdiction over the characterization of the payments. Given the $309,190 advance, Carla agreed to defer her fee request.

On October 30, Steve and Carla filed a stipulation in which they acknowledged their dispute over their date of separation, with Steve claiming they had separated in 2007 and Carla claiming they had separated on October 15, 2011. The stipulation also acknowledged Carla's position that the 2010 divorce agreement was unenforceable. And they agreed to bifurcate these two issues for early trial.

In December, Steve and Carla stipulated that the 2010 divorce agreement would not be enforced. And, as would become significant in the subsequent trial on spousal support and here on appeal, the parties stipulated "that their date of separation will be March 31, 2010 for all purposes."

On September 19, 2013, Steve and Carla reached a settlement regarding property division, reimbursement claims, and temporary support owed through that month. Pursuant to the parties' division of property, Carla received approximately $3 million in assets, and Steve approximately $3.4 million.

4. Trial on Spousal and Child Support

In April and May 2014, a six-day trial on spousal and child support was held, the parties having agreed that the issue of attorney fees would be dealt with by declaration after the support matters were decided. Prior to trial, Carla filed a motion in limine requesting, among other things, that the court bar evidence contesting the stipulated date of separation and regarding fault related to the breakup of the marriage. After lengthy argument, the court ruled that it would not allow any party to dispute the stipulated date of separation but that Steve would be permitted to offer evidence regarding events during the marriage that impacted the Family Code section 4320 factors,² such as that the parties were "apart, they were working, they had agreed to separate and that impacts the standard of marriage." The court also granted Carla's request to exclude evidence of fault, holding that "there should not be any mention of any extramarital affairs since they are not to be considered by the Court under the law."

2 As will be discussed at length, Family Code section 4320 identifies 14 factors the trial court is to consider and weigh when it rules on a request for spousal support.
All statutory references are to the Family Code except where otherwise noted.

a. Evidence from the Parties' Forensic Experts

Steve and Carla both presented testimony from forensic accountants, James Good on behalf of Steve and Michael Miskei on behalf of Carla. Both experts prepared expense- and income-based analyses of the parties' marital standard of living, as well as an analysis of Steve's income available for support.

Good's expense-based analysis considered the parties' expenses for the 39 months preceding the March 31, 2010 date of separation. He determined that Carla's average monthly living expenses during that period were $7,032 (which included $2,955 for a rental home). He then adjusted her total monthly living expenses to $7,902 in order to account for her share of the couple's monthly savings (which he estimated to be $1,097).³

3 Good estimated the children's monthly expenses to be $5,002, one-half of which would be $2,500.

Good's income-based analysis was based on the parties' tax returns for the years 2004 through 2009, using the following numbers: 2004—$176,907; 2005—$166,351; 2006—$156,900; 2007—$248,526; 2008—$62,978; 2009—$438,044. These numbers were significantly lower than those used by Carla's expert because they excluded certain categories of income that Good treated as nonrecurring. After deducting what he considered would be the children's share of the average monthly cash flow, he concluded that Carla's share of the average monthly cash flow was $7,902.

Good also analyzed Carla's postseparation spending covering the 16 months ending July 31, 2013. That analysis showed that Carla spent $6,996 per month on her expenses during that time period, which was consistent with his analysis of her monthly expenses during the 39 months prior to the date of separation.

To determine Carla's spousal support needs, Good imputed to Carla annual employment earnings of $31,200 based on her full-time job and investment income of $85,061, calculated at a 2.77 percent return on her investible assets of $3,070,797. Good did not deduct $1.7 million from Carla's investible assets for the purchase of a house because it was "speculative that she's going to take $1.7 million of her investable assets and put into a residence which would be a non-income-producing asset." Based on these figures, Good imputed to Carla an annual income of $116,261—or $9,688 per month. He concluded that this imputed income was adequate to meet Carla's average monthly living expenses, which did not exceed $8,000 under either of his analyses.

The analysis prepared by Miskei, Carla's forensic expert, varied greatly from Good's. The discrepancies were largely attributable to Miskei's inclusion of nonrecurring events (e.g., annual bonuses, PSP awards and "Stock Settled Appreciation Rights" (S-SARs)) as part of Steve's earnings, amounts Good had excluded. By including these nonrecurring events, Miskei determined Steve's average monthly cash flow available for support to be $452,134. He determined Carla's monthly cash flow available for support as of April 28, 2014 to be $5,381. This included $31,200 annual income from a full-time job (2080 hours at $15 per hour), plus annual investment earnings of $33,370. To calculate Carla's investible income, Miskei considered her investible assets, less $1.7 million for the purchase of a home.

Miskei also prepared two different income-based analyses of the marital standard of living based on tax returns for 2007 to 2010, one for 2007 to 2009, the other for 2007 to 2010 (in light of the March 31, 2010 date of separation). For the couple's spendable income for those years, Miskei used the following income figures: 2007—$331,000; 2008—$778,978; 2009—$943,114; and 2010—$1,127,139. After calculating an average monthly spendable income based on those figures, he deducted an amount attributable to the children's expenses, to arrive at the amount of income available for Steve and Carla. He then divided that amount in half, to arrive at a figure that represented the amount of after-tax spendable income necessary to maintain each spouse at the marital standard of living—$26,572. From that, he deducted Carla's earned income and imputed investment income, and determined that in order for Carla to net $26,572 on an after-tax basis, she would need monthly spousal support of $36,068. If he excluded 2010 from his calculation, the after-tax support Carla needed was $30,060.

Miskei also prepared an expense-based analysis of the marital standard of living between 2007 and March 31, 2010. This included an itemization of all household expenditures, as well as savings and investments. From that analysis, Miskei determined Carla's share of living expenses to be $21,388 per month, which could be met by approximately $30,000 in monthly spousal support. Miskei testified that one of the biggest differences between his and Good's expense-based analyses was the marital savings and investment figure. Where he allocated $8,900 per month to that category, Good used $1,000 per month.

b. Steve's Income

While employed at Pylonia Ventures in 2000, Steve's base salary was $100,000. In 2003, he earned $393,000 at Danske Bank. In 2004, he commenced work at Roche, where he earned $324,000, including a bonus. The following year his income dropped to $231,000, and then increased to $312,000 in 2006 and $399,000 in 2007.

Roche's acquisition of Genentech in 2008 brought Steve's first significant career increase in earnings. That increase, as well as subsequent ones, came largely in the form of what the court later referred to as "non-reoccurring" events. For example, Steve received PSP awards, which were based on share price and depended on Genentech's performance compared to 18 peer companies. He received PSP awards in 2008 and 2009, but not in 2010, 2011, or 2012.⁴ Steve also received S-SARs, which depended on Genentech's performance in the stock market. He was also eligible for an annual performance-based cash bonus.⁵

4 The 2008 and 2009 allocations were divided equally between Carla and Steve pursuant to their 2012 property settlement.

5 When Steve first arrived in the United States in 2009, he received expatriate benefits, including relocation services, car and housing allowances, and tuition assistance for the children. At the time of trial, he was no longer receiving those benefits.

Steve's annual income for 2008 through trial is difficult to discern from the record, as there were sometimes different numbers given for the same year. The following approximations, however, provide an idea of Steve's astronomical earnings beginning in 2008—and thus what was potentially at stake in the dissolution proceeding:

2008—$1,053,877

2009—$1,546,000

2010—$1,873,902

2011—$1,988,499

2012—$1,637,949

2013—$5,968,015⁶

6 We derive some of these numbers from Carla's opening brief. In support, she cites various trial exhibits that are not part of the appellate record. Steve does not, however, dispute Carla's figures.

At the time of trial in 2014, Steve's annual base salary as the chief financial officer of Genentech was $450,000. For the period January 1 through March 15, 2014 alone, he had earned $3,619,759, plus 12,483 S-SARs that had vested.

c. The Couple's Homes

After Steve and Carla earned their respective Harvard degrees and moved to London, they rented an apartment. From there, they moved to Norway, where they purchased an apartment for approximately $500,000. They sold that apartment when they moved to Switzerland in 2004, where they again rented. The only other real property they owned was a flat in Paris that Carla jointly inherited with her brother. In 2007, Steve and Carla used their savings to buy Carla's brother's half-interest in the flat.⁷ At the time of trial, the flat was valued at $594,000.

7 It appears they purchased Carla's brother's interest for $186,935.

d. Temporary Support Paid Pending Trial

For the period March 31, 2010 (the parties' stipulated date of separation) through March 31, 2012, Steve paid a total of $191,415 in combined child and spousal support.

For the period April 1, 2012 through April 1, 2014, Steve paid an average of $21,349 per month in tax-free child support and $42,896 per month in pre-tax spousal support, for an average of $64,245 in total monthly support. In sum, during that two-year period, Steve paid $1,072,402 in spousal support and $533,729 in child support, for a total of $1,606,131. As of March 17, 2014, Carla's savings account had a balance of $2,160,670.

5. The Trial Court's Statement of Decision

On September 22, 2014, the trial court issued its final statement of decision (SOD). After setting forth facts relating to the parties' relationship, the court addressed the length of the marriage for support purposes, finding that the parties had experienced two periods of separation during their 13-year marriage: the first was from January 2004 (when Steve moved to Basel, having told his mother he and Carla were separating) to August 2004 (when Carla and the children arrived in Basel and the couple reconciled); the second was from November 2007 (when the couple agreed to end their marriage) through March 31, 2010 (the couple's stipulated date of separation). During that time period, the parties were not intimate; they told their friends and families of their intent to divorce; they commenced divorce mediation in Switzerland; and Carla maintained a relationship with another man.

As to the marital standard of living, the court found that Steve and Carla had not lived extravagantly. They rented homes for most of their marriage, including in London, Basel, and San Francisco. The one apartment they purchased when they moved to Norway was a modest property, 1,200 square feet with three bedrooms and one bath. The only other property they owned was the Paris flat Carla and her brother inherited.

In assessing the parties' marital standard of living, the court considered the income- and expense-based analyses presented by the parties' forensic accountants. As to the expense-based analyses, the court noted that Steve's forensic accountant Good calculated that the parties spent approximately $16,439 each month for the family as a whole during the 39 months prior to March 31, 2010. Carla's forensic accountant Miskei, on the other hand, estimated that the parties spent approximately $36,354 each month. The disparity in the analyses came from Miskei's inclusion of disputed categories of income.

The income-based analyses performed by the experts also widely varied. Good provided multiple options for the court's consideration, ranging in average annual incomes of $208,284 for 2004 through 2009, to $249,849 for 2007 through the date of separation. Miskei, on the other hand, calculated the parties' average annual income for 2007 through the date of separation as $1,203,303, a figure again inflated by the inclusion of nonrecurring income.

Having reviewed the experts' analyses and the circumstances of the parties, the court found Good's analysis "more accurate and more persuasive with respect to the marital standard of living as it takes into consideration the totality of the circumstances." And based on his analysis, it found that Carla's needs based on the marital standard of living did not exceed $8,200 per month.⁸

8 It is unclear how the court arrived at the $8,200 figure, since Good's analysis estimated Carla's average monthly expenses to be $7,032 without savings and $7,902 with savings.

Turning to Carla's proposed needs, the court observed that Carla was seeking nearly $70,000 per month for the rest of her life. As to this, the court stated, "Her testimony regarding her proposed needs is grossly disproportionate to the marital standard of living she enjoyed. For example, she proposes $7,600 for a mortgage on a home she has not yet purchased. She proposes $2,500 per month in property taxes, meaning she would purchase a home in excess of $2,500,000. Carla lists $2,000 per month for a nanny so that she may work but both of her children are in school, and the girls live with Steve half of the time. She lists her proposed needs for clothing at $2,500 per month and $1,500 per month for her two daughters when Mr. Good's analysis showed that the parties spent far less during the period of marriage on these items. Finally the Court finds the $30,000 per month for proposed savings is not reasonable and not based on the reality of the marital standard of living." (Fn. omitted.)

The court further found that Carla had been receiving temporary spousal and child support since January 2010, which amounted to four years, six months of support through the time of trial. For the period March 31, 2010 through March 31, 2012, Steve paid a total of $191,415 in child and spousal support. And for the period April 1, 2012 through April 1, 2014, he paid spousal support of $1,072,402 and child support of $533,729, for a combined total of $1,606,131 for those two years. Thus, from the stipulated date of separation through the start of trial, Steve paid Carla just under $1.8 million in support.

As to Steve's annual income available for support, the court found that he was earning a base salary of $450,000, plus a potential yearly cash bonus, PSP awards, S-SARs, and investment income. The court excluded the annual bonus, PSP awards, and S-SARs from its calculation of Steve's income available for support, providing this explanation for doing so: "The testimony of the accountants and Steve . . . supports a finding that Steve's bonus, the PSP awards and the S-SARs are non-recurring variable income. The traditional cash bonus is based on Steve's performance and is not certain. The PSP awards are based on share price and are dependent on Genentech's performance as it compares to 18 peer companies in the same industry. This additional income is extremely volatile. As an example, Steve has not received PSP awards for 2010, 2011, or 2012. Finally, the S-SARs are on a vesting schedule and some of Steve's S-SARs have not yet vested. The S-SARs are dependent on Genentech's performance on the stock market and are not certain." The court thus found Steve's income available for spousal support should be capped at the marital standard of living and totaled $531,927, comprised of his base salary ($450,000), imputed life insurance ($2,421), and imputed investment income ($81,030).

The court found Carla to be highly employable and imputed to her an annual income of $36,000 as suggested by a vocational evaluation. It also found she had $3,084,684 in investible assets. It noted Carla's argument that the amount of her investible assets should be reduced by $1.7 million because she wanted to buy a house, but found her testimony regarding a house purchase to be "inconsistent, not credible and lacking in support." Based on Carla's investible assets, the court imputed to her $85,445 in investment income (using a 2.77 percent interest rate⁹), for a total of $121,445 in imputed income.

9 According to the court, this was the rate recommended by both forensic accountants.

The court then undertook a detailed analysis of the section 4320 factors, as follows:

Section 4320, subdivision (a)—the extent to which the parties' earning capacity was sufficient to maintain the standard of living established during the marriage: The court found that Steve and Carla "enjoyed an upper middle class lifestyle while married," spending most of their marriage in rental homes, only once purchasing a home, which was a $500,000, 1,200 square foot flat with three bedrooms and one bathroom. The court further found that "the parties' total income for the first ten years of the parties' marriage, 1997 through 2007, was $2,269,343." Their average annual income was $214,559.80 for the years 2005 to 2009 and $249,849 for the years 2007 to 2009. Finally, the court found the couple spent an average of $17,655 per month during the marriage, which included savings of $1,100 per month.

Section 4320, subdivision (b)—the supported party's contribution to the supporting party's attainment of an education, career position, or license: The court found that Carla stayed home to raise the children so Steve could concentrate on his career. It also found that many of their moves (to London, Norway, and Switzerland) were mutual decisions that were not based solely on Steve's career. While the decision to move to San Francisco in 2009 was based on a job opportunity for Steve, the court pointed out that Carla did not move to San Francisco immediately, and she left for Paris less than a year after having moved.

Section 4320, subdivision (c)—the ability of the supporting spouse to pay spousal support, taking into account the supporting party's earning capacity, earned and unearned income, assets, and standard of living: The court found that Steve had the ability to pay support, given his base salary of $450,000 and the additional bonuses and awards he may earn.

Section 4320, subdivision (d)—the needs of each party based on the standard of living during the marriage: The court accepted expert Good's analysis of the parties' average monthly living expenses and his conclusion that Carla's monthly needs were $7,032 and the children's expenses were $5,002. It noted that Steve's "position at Roche changed during a period of separation in the marriage. The merger of Roche and Genentech caused for unusual cash bonuses, expatriate benefits, PSP awards and S-SARs that are not included as income in calculating the marital standard as they are non-recurring, and would grant a windfall to Carla under the circumstances of the parties."

Section 4320, subdivision (e)—the obligations and assets, including separate property, of each party: The court noted that Carla had approximately $3 million in investible assets, and Steve $4 million. It imputed interest on these assets at a rate of 2.77 percent. And the court specifically found this: "Carla has a responsibility to manage her finances in such a manner as to enable her to become self-supporting. See Marriage of McElwee (1988) [197] Cal.App.3d 902, 909-910. By her own testimony, Carla has asserted that she has no intention of investing her savings or separate property that could provide her with sufficient income to become self-supporting. The Court finds that Carla has an obligation to become self-supporting and part of that obligation includes managing her finances, including savings, in a manner that will produce income for her."

Section 4320, subdivision (f)—the duration of the marriage: The court found the marriage to have been 10 years, three months long, which qualified as one of long duration. It reasoned as follows:

"The Court has considered periods of separation during the parties' marriage pursuant to California Family Code section 4336. It is undisputed that the parties stipulated to a date of separation in this matter. This stipulation identifies the length of marriage . . . as 13 years, and one (1) month. However, that stipulation does not preclude either party from asserting claims related to their support obligations. If the parties' marriage has involved interim separations and reconciliations, the court may consider those periods of separation in determining whether the marriage is in fact of long duration. Family Code § 4336(b).

"The Court finds that the parties experienced two (2) periods of separation during their thirteen-year marriage. The Court finds that there was a period of physical separation from January 2004 through August 2004. The court also finds that the second period of separation began in November 2007 and continued until the parties' official date of separation on March 31, 2010. Included in the second period is the year when Steve, and then eventually Carla, moved to San Francisco.

"The changes made by Steve regarding his life and career, his reliance on the parties' agreements during the second period of separation, the parties' actions during these periods including living in separate rooms, informing friends and family of their separation, attending divorce mediation in Switzerland, payment of support, the continuation of outside relationships, this Court finds that the significant spike in Steve's income is not indicative of the parties['] marital standard of living in consideration of this gap. While the gaps in the parties' marriage do not impact the stipulation regarding the date of separation, this Court finds them relevant when considering the standard of living of the parties and the determination of whether this marriage is one of long duration under Section 4336."

Section 4320, subdivision (g)—the ability of the supported party to engage in gainful employment without unduly interfering with the interests of the children in the party's custody: The court found that the couple's two children—who were 12 and 13 years old at the time—were in school full-time and shared equal time with Steve and Carla. Carla could thus seek employment without interfering with the children's best interest.

Section 4320, subdivision (h)—the age and health of the parties: Steve was 45 years old, Carla 43, and both were in good health.

Section 4320, subdivision (k)—the balance of the hardships to each party: The court found that Carla had the ability to earn $36,000 per year, plus investment income of $85,445. Steve earned a base salary of $450,000, plus investment income and the potential for bonus and equity awards.

Section 4320, subdivision (l)—the goal for the supported party to become self-supporting within a reasonable period of time: The court found that Carla was employed as a sales manager earning $15.00 per hour, had a bachelor's degree from Harvard University cum laude, spoke three languages fluently, and was young and healthy with a work life of at least 20 years ahead of her. It further found that despite Steve's July 12, 2012 Gavron warning,¹⁰ Carla had not made any meaningful efforts to obtain employment from the date of separation until February 2014, having applied for only 10 jobs between April 1, 2012 and July 16, 2013. A vocational consultant who evaluated Carla to determine her employability and earning capacity reported that Carla needed to invest more time and energy into finding paid employment and was resistant to considering alternatives to retail sales that would offer her greater earning potential. The court also noted that, according to the consultant, Carla had weak computer skills that needed improvement, but Carla failed to produce any evidence at trial that she had enrolled in or completed any computer training, and she told the consultant she could only work part-time because she needed to be " 'available for her children' "; "she would 'snap' if she were forced to work full time; that she would not be forced into full-time work; that she is unable to 're-invent' herself; and that she was happy as a homemaker and stay-at-home parent. [Citation.] A reasonable interpretation of these statements is that Carla has no incentive to become self-supporting."

10 A Gavron warning is an order issued to the supported spouse that he or she is expected to become self-supporting. (In re Marriage of Gavron (1988) 203 Cal.App.3d 705; In re Marriage of Schmir (2005) 134 Cal.App.4th 43, 55.) Here, it came in the form of a notice served by Steve, rather than an order of the court.

Section 4320, subdivision (n)—other just and equitable factors: The court found that "Steve has paid spousal support for four (4) years and seven (7) months, not including contributions to Carla's support during the parties' marital gap from November 2007 through March 2010. [¶] Since March 2012, Carla has received $42,896 per month in spousal support. [Citation.] Steve's spousal support obligation has been fulfilled. Regardless of what analysis is applied, the significant temporary support payments from Steve to Carla were more than double what she should have received in permanent support. The Court finds that Carla's support was front-loaded and that Steve's obligation has been fulfilled by said payments."¹¹

11 The court also found that there was no history of domestic violence (§ 4320, subd. (i)), no criminal convictions of an abusive spouse (id., subd. (m)), and no noteworthy tax consequences (id., subd. (j)).

Following this extensive analysis of the section 4320 factors, the court made this spousal support award: "[T]he court orders Steve to pay post-judgment permanent spousal support with no Smith-Ostler ¹² to Carla pursuant to a Richmond Order. Based on the income earned, income from division of the marital estate and support paid th[r]ough the date of trial pursuant to the temporary orders, the Court finds that commencing September 1, 2014, spousal support shall be set at $5,000.00 per month and shall terminate on December 31, 2014, absent a showing by Carla, prior to the termination date, of good cause to extend spousal support as required under In re Marriage of Richmond (1980) 105 Cal.App.3d 352.¹³ While the Court does consider this a long-term marriage, Carla today is self-supporting under the analysis the Court adopts, Mr. Good's findings, Carla's income from her employment and the interest she could earn from her liquid assets standing alone. In addition, the Court may consider the child support she will receive as income to satisfy the marital standard of living."

12 In re Marriage of Ostler & Smith (1990) 223 Cal.App.3d 33 (Marriage of Ostler & Smith).

13 In In re Marriage of Richmond, supra, 105 Cal.App.3d at p. 356, the court held that the trial court may order a conditional termination of spousal support "so as to encourage such supportive self-reliance, and to discourage delay in preparation for or in seeking, or refusal of, available employment." (See Hogoboom & King, California Pract. Guide: Family Law (The Rutter Group 2017) ¶ 17.180, p. 17-73.)

As to child support, the court ordered Steve to pay $3,535 per month for both children, with additional support based on a percentage of his cash bonus income. It also ordered that Steve and Carla would each pay 50 percent of the children's tuition, uninsured health care costs, and extracurricular activities.

Carla filed a timely appeal (No. A144387).

B. DISCUSSION

1. Carla's Contentions

In her appeal from the SOD, Carla asserts that the trial court committed eight errors: (1) finding there was a period of separation from November 2007 to March 31, 2010 in disregard of the parties' stipulation that the date of separation was March 31, 2010 for all purposes; (2) excluding Steve's nonsalary earnings between 2007 and 2010 from the marital standard of living; (3) excluding nonrecurring income from the marital standard of living and income available for support; (4) establishing a termination date of December 31, 2014 for spousal support without evidence Carla would be self-supporting by that date; (5) refusing to permit Carla to buy a residence; (6) finding that temporary support can be a prepayment of permanent spousal support; (7) misapplying the section 4320 factors; and (8) not awarding Carla additional support on the excess income Steve received after March 31, 2010.

2. The Law Governing Spousal Support

Temporary spousal support, awarded under section 3600, is intended "to maintain the living conditions and standards of the parties as closely as possible to the status quo, pending trial and the division of the assets and obligations of the parties." (In re Marriage of McNaughton (1983) 145 Cal.App.3d 845, 849; In re Marriage of Wittgrove (2004) 120 Cal.App.4th 1317, 1328 ["maintaining the status quo . . . is the benchmark for temporary spousal support"].) By contrast, long-term spousal support (typically referred to as "permanent" spousal support) is intended to provide " 'financial assistance, if appropriate, as determined by the financial circumstances of the parties after their dissolution and the division of their community property.' " (In re Marriage of Winter (1992) 7 Cal.App.4th 1926, 1932; see also In re Marriage of Schulze (1997) 60 Cal.App.4th 519, 525 ["permanent spousal support is supposed to reflect a complex variety of factors established by statute and legislatively committed to the trial judge's discretion, including several factors which tend to favor reduced support, such as the 'goal' that the supported spouse should become self-supporting within a reasonable period of time"].)

In determining whether to award permanent spousal support and, if so, how much and for how long, the court must consider and weigh the 14 factors set forth in section 4320, to the extent they are relevant. These factors include the marital standard of living (§ 4320, subd. (a)), which is considered "a reference point against which the other statutory factors are to be weighed." (In re Marriage of Cheriton (2001) 92 Cal.App.4th 269, 303 (Marriage of Cheriton); In re Marriage of Khera & Sameer (2012) 206 Cal.App.4th 1467, 1483.) The marital standard of living, which describes the "station in life that the parties had achieved by the date of separation," "is neither a floor nor a ceiling for a spousal support award." (In re Marriage of Nelson (2006) 139 Cal.App.4th 1546, 1560.) While "the marital standard of living is an important factor in determining spousal support, it is not the only factor, and its importance in determining whether it is 'just and reasonable' (§ 4330) to award spousal support will vary based on the court's evaluation of the section 4320 factors." (In re Marriage of Shaughnessy (2006) 139 Cal.App.4th 1225, 1247; accord, In re Marriage of Smith (1990) 225 Cal.App.3d 469, 490 (Marriage of Smith) ["The marital standard is just one factor to be weighed with all other applicable factors to reach a 'just and reasonable' result."].)

The other section 4320 factors that inform the court in reaching a just and reasonable result include "contributions to the supporting spouse's education, training, or career; the supporting spouse's ability to pay; the needs of each party, based on the marital standard of living; the obligations and assets of each party; the duration of the marriage; the opportunity for employment without undue interference with the children's interests; the age and health of the parties; tax consequences; the balance of hardships to the parties; the goal that the supported party be self-supporting within a reasonable period of time; and any other factors deemed just and equitable by the court." (Marriage of Cheriton, supra, 92 Cal.App.4th at pp. 303-304; § 4320, subds. (b)-(l).) The court may determine the appropriate weight to be given each factor, with the goal of accomplishing substantial justice for the parties. (Marriage of Smith, supra, 225 Cal.App.3d at pp. 481-482.) In setting the amount and duration of permanent spousal support, the trial court has wide discretion. (Id. at pp. 479-480.)

Finally, it is important to note that it is the "policy of this state . . . to encourage a supported spouse to achieve self-support as quickly as possible and to the extent of her or his ability." (In re Marriage of Aninger (1990) 220 Cal.App.3d 230, 240.)

3. The Abuse of Discretion Standard of Review

As a general rule, "we review spousal support orders under the deferential abuse of discretion standard. [Citation.] We examine the challenged order for legal and factual support. 'As long as the court exercised its discretion along legal lines, its decision will be affirmed on appeal if there is substantial evidence to support it.' [Citations.] 'To the extent that a trial court's exercise of discretion is based on the facts of the case, it will be upheld "as long as its determination is within the range of the evidence presented." ' [Citation.]" (In re Marriage of Blazer (2009) 176 Cal.App.4th 1438, 1443.) As admonished by our colleagues in Division Three: "Although patterns in marital breakups emerge, each couple has such a diverse mix of circumstances that trial courts must have broad discretion in weighing and balancing the various factors in each particular marriage before making a suitable support award. A trial court will not be reversed absent an abuse of that discretion. An abuse 'occurs when, after calm and careful reflection upon the entire matter, it can be fairly said that no judge would reasonably make the same order under the same circumstances.' [Citations.] Because trial courts have such broad discretion, appellate courts must act with cautious judicial restraint in reviewing these orders. [Citation.]" (Marriage of Ostler & Smith, supra, 223 Cal.App.3d at p. 50; accord, In re Marriage of Ackerman (2006) 146 Cal.App.4th 191, 207 (Marriage of Ackerman).)

The abuse of discretion standard is not without its pitfalls. As we discussed in People v. Jacobs (2007) 156 Cal.App.4th 728, 736, a variety of phrases have been employed to describe the standard, such as " ' " 'a clear case of abuse' " ' and ' " 'a miscarriage of justice,' " ' " to a ruling that " ' " 'fall[s] "outside the bounds of reason" ' " ' " or is arbitrary, whimsical, or capricious. (See People v. Benavides (2005) 35 Cal.4th 69, 88; Blank v. Kirwan (1985) 39 Cal.3d 311, 331; People v. Branch (2001) 91 Cal.App.4th 274, 282; People v. Linkenauger (1995) 32 Cal.App.4th 1603, 1614.) Subsequent to our opinion in People v. Jacobs, the Supreme Court reiterated another formulation of the standard: "A ruling that constitutes an abuse of discretion has been described as one that is 'so irrational or arbitrary that no reasonable person could agree with it.' " (Sargon Enterprises, Inc. v. University of Southern California (2012) 55 Cal.4th 747, 773.)

In an eloquent dissent to an opinion that was depublished upon the Supreme Court's grant of review, the Honorable Laurence Rubin of the Second Appellate District articulately detailed the hazards of the abuse of discretion standard, noting that "the various formulations of abuse of discretion also have serious ramifications for the relationship between the appellate and trial courts." He reasoned as follows:

"The colorful 'whimsical, capricious, arbitrary' standard proves the point. I am doubtful that any judge in our state has made a ruling out of whimsy or caprice. Whim, for example, is 'a capricious or eccentric and often sudden idea or turn of the mind.' (Merriam-Webster Online Dict. <http://www.merriam-webster.com/dictionary/whim> [as of Dec. 12, 2013].) This does not describe judicial decisionmaking. If we are truly engaging in appellate review to weed out the whimsical or capricious decision, I doubt we would ever find abuse of discretion. Labeling a trial judge arbitrary is so pejorative, appellate judges would almost always be adverse to finding abuse of discretion under that standard. Describing a trial court decision 'as an act exceeding all bounds of reason' or 'patently absurd' is also inherently inflammatory.

"Even the word 'abuse' in the 'abuse of discretion standard' is incendiary, as courts often link 'abuse' to 'elder' or 'child' in describing heinous behavior. Would we not be loathe to describe a judge as abusing his or her power? Because of these various distasteful formulations, one commentator colorfully described a reversal for abuse of discretion as 'the noise made by an appellate court while delivering a figurative blow to the trial judge's solar plexus. It is a way of saying to the trial judge, "This one's on you." The term has no meaning or idea content that I have ever been able to discern. It is just a way of recording the delivery of a punch to the judicial midriff.' (Rosenberg, Professor of Law, Columbia University, address to Federal Appellate Judges Seminar (May 13-16, 1975) Appellate Review of Trial Court Discretion.)" (Fns. omitted.)

Why do we discuss Justice Rubin's observations? We would be hard-pressed to label the trial court's ruling here whimsical, arbitrary, or capricious, much less irrational. The SOD was comprehensive, detailed, and thoughtful, evidencing a conscientious effort by the court to reach the proper result. Nevertheless, we conclude there was an abuse of discretion as to some of the court's conclusions regarding the marital standard of living, error that potentially infected the court's determination that Carla was already self-supporting at that standard.

4. The Trial Court's Finding of How Much Carla Needed in Order to Live at the Marital Standard of Living Finding Was Unsupported by Substantial Evidence

The question of what constitutes the marital standard of living has vexed courts and legislators for decades.¹⁴ In this case, both parties retained forensic accountants who prepared complicated analyses to aid in answering this question, a practice not uncommon in complex marital dissolution cases. The trial court found the analysis prepared by Steve's expert Good to be "more accurate and more persuasive . . . as it [took] into consideration the totality of the circumstances." While it may have been more accurate to the extent it took into consideration the period of separation that began in November 2007, it was inaccurate in other regards, particularly as to the family's housing expenses.

14 In 1990, our Division Five colleagues made this observation: "At the 1988 State Bar Convention, the Family Law Section of the State Bar presented a program on what the Legislature intended by the marital standard of living as reflected in the 1988 amendments to [former Civil Code] section 4801, subdivision (a), featuring a panel of a dozen distinguished certified family law specialists and family law judges. It is telling that after a two-hour panel discussion not one of these highly experienced family law experts could provide any guidance for what constitutes the required 'specific factual finding with respect to the standard of living during the marriage.' " (Marriage of Smith, supra, 225 Cal.App.3d at p. 489, fn. 10.)

Good's analysis of the family's expenditures from January 1, 2007 to March 31, 2010 allocated $7,902 per month to Carla. From that, the court extrapolated that Carla's needs based on the marital standard of living did not exceed $8,200 per month. According to Carla, this figure included only $1,168 per month for housing, despite that the family had been living in a house (with Steve and her living in separate quarters) in San Francisco that rented for $8,500 per month. Carla argues that she cannot obtain housing comparable to the marital standard of living given that $1,168 is de minimus. In fact, Good actually allocated $2,955 per month to Carla's housing expense. Carla's error is understandable in light of Good's convoluted calculations on this issue. But even $2,955 was grossly inadequate to allow Carla to obtain housing for her and the children at the marital standard of living.

As noted, Good's analysis attempted to determine the family's average monthly expenses for the 39-month period preceding the date of separation, or January 1, 2007 to March 31, 2010. In general, he determined the expenses for the period the family lived in Switzerland and divided that figure by 39, determined the expenses for the period the family lived in San Francisco and divided that figure by 39, and then added those numbers together and allocated a certain percentage to Carla (typically, zero, 25, 33, 50, or 67 percent, depending on the nature of the item). He utilized this methodology for categories such as utilities, groceries and household supplies, dining out, clothing, and vacations. As to housing, for rent in Switzerland, the family paid $104,010, which Good divided by 39, to arrive at average monthly rent of $2,667, of which he allocated $1,787 (67 percent) to Carla. He treated the San Francisco rental expenses differently, given the rent subsidy received from Steve's employer. For that figure, he used the $8,500 paid by Steve's employer multiplied by six months,¹⁵ to arrive at $51,000 that the family would have spent for San Francisco rent. He then divided it to arrive at a monthly rental expense of $1,744, of which he allocated $1,168 (67 percent) to Carla.¹⁶ Good then totaled all average monthly expenditures, arriving at average monthly expenditures for Carla of $7,902, which included the $1,787 (Switzerland) and $1,168 (San Francisco) rental expenses, or $2,955 for rent.

15 Theoretically because the family lived in the rental home for six months prior to the date of separation. By our calculation, that figure was eight months (from August 2009 to March 2010).

16 It is unclear how Good arrived at the $1,744 figure, which is $51,000 divided by 29.24. When asked by Carla's counsel what number he divided $51,000 by to get $1,744, Good responded, "[T]he San Francisco rent, that there was actually $51,000 of rent, actual payments that we saw. But we upward adjusted that, the number in our average monthly, to reflect the period of time from August 1st, 2009, through March 31st, 2010, to reflect the $8,500 a month rent that would have been paid, whether it was for Steve's company or from their accounts. [¶] So that 51,000 number, there's no number, I think, that you would divide it by to come up with the 1744."

Good clearly acknowledged that the cost of the family's rental home in San Francisco was $8,500 per month, yet his methodology allowed him to allocate less than $3,000 to Carla for housing. While it is reasonable to assume she could find a rental home for less than $8,500 since she and the children did not need a four-bedroom house, it is unreasonable to believe Carla could obtain housing in San Francisco for her and the children at the marital standard of living for $2,955 per month. Good's methodology failed, among other things, to account for the family's relocation to San Francisco—one of the most expensive housing markets in the country. Because the family spent the majority of the time period under analysis living in Switzerland, the average housing expenses—indeed, all expenses—were heavily weighted towards the family's expenses in that country, with no regard to the fact that the family no longer lived there. We fail to understand how the rental expense for the Swiss apartment was relevant to how much Carla needed in order to obtain housing in San Francisco comparable to the family's station in life at the time of separation.

There is no set formula for determining the marital standard of living, and courts have relied on income- and expense-based analyses prepared by forensic accountants. (See, e.g., In re Marriage of Weinstein (1991) 4 Cal.App.4th 555, 562.) And perhaps Good's analysis was not an unreasonable starting point. But it was incumbent upon the court to critically examine his methodology to ascertain whether it produced figures that reasonably represented the marital standard of living. (See, e.g., Sargon Enterprises, Inc. v. University of Southern California, supra, 55 Cal.4th at p. 770 ["the trial court acts as a gatekeeper to exclude speculative or irrelevant expert opinion"].) The foregoing demonstrates that his methodology did not, at least in the category of housing, which is typically the single largest expense for a family.

Significantly, Good himself conceded that his analysis did not mean that Carla could find comparable housing for $2,995 per month, as evidenced by this exchange with Carla's counsel:

"Q: Using, for example, your allocation of $1,168 to Carla of the San Francisco rent, that was $8,500 per month—it was $8,500 a month. Forget averaging it. That's what was the rent, correct?

"A: Yes.

"Q: And it's your determination that Carla's marital standard of living for that residence is $1,168 per month, correct?

"A: In taking—with respect to the whole analysis, that was the amount that was allocated for [the] 39-month period, yes.

"Q: It's not your testimony here today that Carla could have even modestly similar housing for rent of $1,168 per month, is it? That's not your testimony, is it?

"A: I think the—what I mentioned before is the total rent. If you—you would need to add line 2, 1,787 per month, plus the $1,168 a month, and that's just shy of $3,000.

"Q: Okay. So is it your testimony that Carla could have similar housing to what the parties were paying $8,500 for, for the $3,500 a month you just stated?

"A: Well, again, they—I'm looking at this 39-month period and the expenses for the housing for which they lived in over this period. So I did not [make] an adjustment to reflect that they lived 39 months in a residence that cost $8,5000 a month.

"Q: I understand that. But you're asking this Court to limit Ms. Vinhas' standard of living. She needs no spousal support and only 7,000 and change per month in order to have the general station in life that she had during marriage, and you're telling us that she could have housing for less than what they paid together. [¶] Is that your testimony?

"A: I'm not asking the Court to limit anything. I'm just representing to the Court what the expenses were that would be reflected of their standard over this 39-month period.

"Q: But if Carla could not have replacement housing for $3,500 per month that came close to the $8,500 per month, is it your testimony that that is reflective of the marital standard of living?

"A: I think there's a disconnect here. My analysis is reflecting the entire period, not just one, whether it's nine months in time, period. I'm looking at the overall 39-month period.

"Q: Where do the parties live now?

"A: Just generally San Francisco.

"Q: Right. They don't live in Europe anymore, correct?

"A: Correct."

From this exchange, it is apparent that the trial court accepted Good's $7,902 figure as the amount Carla needed to live at the marital standard of living, when that was not, by Good's own admission, what that figure necessarily represented. The court's marital standard of living finding was thus unsupported by substantial evidence. And it necessarily follows that its finding that Carla was self-supporting at the marital standard of living was likewise unsupported by substantial evidence. This error infected every aspect of the trial court's ruling that turned on the marital standard of living, such as the court's setting of a Richmond termination date. The matter must thus be remanded for the trial court to reevaluate the marital standard of living and whether Carla is in fact self-supporting at that standard. While our discussion has focused on the housing line item, the court must be mindful of the shortcomings in Good's analysis for all expenditures.¹⁷

17 We further note that the figures in Good's analysis were net of tax, yet Carla's income was calculated using her gross monthly employment and commission income.

Despite this error, there were many other issues Carla challenges on appeal that the trial court correctly decided.

5. The Trial Court Did Not Err in Finding That the Parties Endured Two Periods of Separation That Impacted the Duration of Their Marriage and the Marital Standard of Living

Carla challenges the trial court's finding that she and Steve endured two periods of separation in their marriage, the first from January 2004 to August 2004, the second from November 2007 to the couple's stipulated date of separation of March 31, 2010. The court considered those periods of separation when determining the length of the marriage and the marital standard of living. According to Carla, by finding there was a period of separation commencing in November 2007 and continuing until the stipulated date of separation, the court effectively advanced the parties' date of separation for purposes of spousal support to November 2007. This, she contends, disregarded their stipulation that March 31, 2010 was their date of separation " 'for all purposes.' " Carla correctly notes that the consequence of this finding was significant: it allowed the court, in its discretion, to disregard Steve's sizable increases in income between 2007 and 2010 in its assessment of the marital standard of living. Carla is incorrect, however, that the court's finding was improper.

Section 4336 governs the calculation of the duration of a marriage for spousal support purposes. Where a marriage is of long duration, the court retains indefinite jurisdiction, except where the parties have agreed in writing to the contrary or a court has ordered the termination of spousal support. (§ 4336, subd. (a).) As to calculating the duration of a marriage, the statute provides: "For the purpose of retaining jurisdiction, there is a presumption affecting the burden of producing evidence that a marriage of 10 years or more, from the date of marriage to the date of separation, is a marriage of long duration. However, the court may consider periods of separation during the marriage in determining whether the marriage is in fact of long duration. Nothing in this subdivision precludes a court from determining that a marriage of less than 10 years is a marriage of long duration." (§ 4336, subd. (b), italics added; see also In re Marriage of Baker (1992) 3 Cal.App.4th 491, 499.)

The date of separation, on the other hand, governs the division of property acquired during the marriage. California is a community property state, and all property acquired by a spouse during marriage is community property, except as otherwise provided by statute. (§ 760.) Section 771 establishes one such exception: "The earnings and accumulations of a spouse and the minor children living with, or in the custody of, the spouse, after the date of separation of the spouses, are the separate property of the spouse." (Italics added; see also In re Marriage of Ettefagh (2007) 150 Cal.App.4th 1578, 1590-1591; In re Marriage of Manfer (2006) 144 Cal.App.4th 925, 929.) Thus, upon the date of separation, a spouse's earnings lose their community property characterization and become the spouse's separate property.

As can be seen, periods of separation and date of separation are two distinct concepts. There can be only one date of separation—the date on which there is a "complete and final break in the marital relationship." (In re Marriage of Baragry (1977) 73 Cal.App.3d 444, 448.) But there can be multiple periods of separation, as the language of section 4336 itself indicates. As Steve accurately describes it, Carla's argument conflates these two concepts. While the stipulation agreed to March 31, 2010 as the "date of separation" for all purposes—i.e., the date on which Steve's earnings ceased to be community property and became his separate property—nothing in it precluded the court from considering periods of separation that occurred prior to that date for purposes of determining the duration of the marriage or the marital standard of living. Had the parties, for example, stipulated to a date of separation and further stipulated that there were no periods of separation, perhaps the result would have been different. That, however, was not what they did.

According to Carla, this distinction created an inconsistency in that income earned between November 2007 and March 31, 2010 became divisible community property but did not count towards the parties' marital standard of living.¹⁸ She submits that the Legislature could not have intended that the parties have a different date of separation for purposes of community property division and spousal support. This argument is flawed, however, in that the law did not create the discrepancy. It was created by the parties' stipulation to a date of separation without regard for any potential periods of separation prior to that date.

18 As Carla acknowledges, Steve's earnings up to the March 31, 2010 stipulated date of separation were divided as community property. She thus benefitted from the stipulation.

Carla also objects that the trial court's consideration of her relationship with another man to support its period-of-separation finding violated California's policy of no-fault divorce. But the court cited that fact not to assign fault for the divorce or to punish Carla for that relationship, but rather as further evidence that the couple was separated during that time period. (See In re Marriage of Hardin (1995) 38 Cal.App.4th 448, 453-454 [that the parties were dating other people was a "relevant consideration[]" on the issue of separation]; In re Marriage of Baragry, supra, 73 Cal.App.3d at pp. 447-448 [husband's cohabitation elsewhere with a girlfriend properly considered in determining whether there was sufficient evidence of legal separation].)¹⁹

19 We also note that Carla herself testified that she engaged in extramarital affairs because Steve was emotionally distant and not intimate with her. The trial court offered to strike this testimony, but Carla's counsel declined the offer.

Carla also argues that the court's finding of the second period of separation was contrary to established law because spouses must be living separately in order for there to be a period of separation, and "other than short periods during Steve's job-related relocations," she and Steve "always lived under one roof." As she explains this argument, "Section 4336 is intended to cover periods of physical separation during a marriage. For example, assume the parties were married for 12 years, but had a five year period of physical separation in the middle. Then section 4336 would come into play and permit the Court to consider whether it should be treated as a marriage of 7 years or 12 years duration." In support, Carla cites the legislative history of former Civil Code section 4801, subdivision (d) (the predecessor to section 4336), which was enacted in 1987 as part of Senate Bill No. 907. As provided in the legislative history, the Family Law Section of the State Bar of California "was concerned about the definition of what constituted a long-term marriage. The consensus of the committee was that 1) There should be a rebuttable presumption that ten years constitutes a 'long-term' marriage; 2) The length of marriage should be defined as being from the date of marriage to the date of separation with the court authorized to consider periods of separation in determining whether or not the marriage is long-term (for example, spouses who separate after living together two years, then reconcile five years later and separate after another three years—this should not be considered a long-term marriage)." (State Bar Cal., Family Law Section, analysis of Sen. Bill No. 907 (1987-1988 Reg. Sess.) as amended Apr. 27, 1987, June 15, 1987, p. 1.) This suggestion was incorporated into Senate Bill No. 907 as subsequently enacted. And, according to Carla, this legislative history demonstrates that "the intent was to provide a limited exception to the ten-year presumption for lengthy periods of physical separation. Like Fam. Code § 771 . . . actual physical separation is required."

Carla's interpretation of section 4336's legislative history is unpersuasive, as it reads into the statute a requirement—physical separation—that is simply not supported by the language of the legislative history. Moreover, this legislative history actually undermines Carla's argument, as the recommendation from the Family Law Section defined the length of a marriage "as being from the date of marriage to the date of separation with the court authorized to consider periods of separation," thus confirming that periods of separation and date of separation are distinct concepts. (State Bar Cal., Family Law Section, analysis of Sen. Bill No. 907 (1987-1988 Reg. Sess.) as amended Apr. 27, 1987, June 15, 1987, p. 1.)

In further support of her argument that spouses must be living separately in order for there to be a period of separation, Carla cites In re Marriage of Davis (2015) 61 Cal.4th 846 (Davis). There, in 2006, the wife told her husband the marriage was over. In 2008, she petitioned for dissolution, but the spouses remained in the marital home until the wife moved out in July 2011. The wife contended the date of separation was in 2006, while the husband claimed it was in 2011. The trial court and the Court of Appeal agreed with the wife. The Supreme Court reversed, agreeing with the husband that the date of separation under section 771 required "both separate residences and accompanying demonstrated intent to end the marital relationship." (Davis, at pp. 863-864.) Davis is not controlling here for multiple reasons.

First, Davis was filed on July 20, 2015, 10 months after the trial court here entered its SOD. Thus, the opinion did not govern the trial court's findings.

Second, Davis is factually distinguishable as it was construing the phrase "living separate and apart" for purposes of determining the couple's date of separation, and thus the date on which earnings became separate, rather than community, property. (Davis, supra, 61 Cal.4th at pp. 849, 852.) Carla's and Steve's date of separation was not in dispute here.

Third, Davis is no longer good law: on July 25, 2016 (after briefing was completed in this case), Governor Jerry Brown signed legislation expressly abrogating Davis's holding to eliminate the requirement that parties must live under different roofs in order to be separated. Senate Bill No. 1255, effective January 1, 2017, amended section 771. (2015-2016 Reg. Sess.) Prior to that date, section 771 provided that the earnings of a spouse while "living separate and apart" were separate property²⁰; it now provides that such earnings "after the date of separation" are separate property. Senate Bill No. 1255 also added section 70, which defines "date of separation" as "the date that a complete and final break in the marital relationship has occurred," as evidenced by the spouse's expression of his or her intent to end the marriage and conduct that is consistent with that intent.²¹ (§ 70, subd. (a).) This definition is consistent with the standard applied by many courts prior to Davis. (See, e.g., In re Marriage of Manfer, supra, 144 Cal.App.4th at p. 928 ["[t]he date-of-separation test does not ask what the public thinks, but whether at least one of the parties intended to end the marriage and whether there was objective conduct 'bespeak[ing] the finality of the marital relationship' "]; In re Marriage of Hardin, supra, 38 Cal.App.4th at p. 451 [legal separation requires both subjective intent to end the marriage and objective conduct demonstrating such intent]; In re Marriage of von der Nuell (1994) 23 Cal.App.4th 730, 736 [date of separation requires both a lack of "present intention of resuming marital relations . . . [and] conduct evidencing a complete and final break in the marital relationship"].)

20 Former section 771 provided: "The earnings and accumulations of a spouse and the minor children living with, or in the custody of, the spouse, while living separate and apart from the other spouse, are the separate property of the spouse."

21 Section 70 provides:
"(a) 'Date of separation' means the date that a complete and final break in the marital relationship has occurred, as evidenced by both of the following:
"(1) The spouse has expressed to the other spouse his or her intent to end the marriage.
"(2) The conduct of the spouse is consistent with his or her intent to end the marriage.
"(b) In determining the date of separation, the court shall take into consideration all relevant evidence.
"(c) It is the intent of the Legislature in enacting this section to abrogate the decisions in In re Marriage of Davis (2015) 61 Cal.4th 846 and In re Marriage of Norviel (2002) 102 Cal.App.4th 1152."
In In re Marriage of Norviel, the Sixth District, like the Supreme Court in Davis, held that "living apart physically is an indispensable threshold requirement to separation . . . ." (In re Marriage of Norviel, at p. 1162.)

6. The Trial Court Did Not Abuse Its Discretion in Excluding Steve's Nonrecurring Earnings Between November 2007 and March 2010 from the Marital Standard of Living and His Income Available for Support

Carla's next two arguments both concern the court's treatment of Steve's nonrecurring income, which the court excluded from its assessment of the marital standard of living and Steve's income available for support. First, she contends the "trial court erred in excluding Steve's earnings between 2007 and 2010 from the marital standard of living." Because we have already concluded that the court did not err in finding there to be a period of separation from November 2007 to March 2010, it logically follows that Steve's earnings during that time period were not reflective of the marital standard of living.²² As no statute defines income for the purpose of determining spousal support, this determination was left to the trial court's discretion. (In re Marriage of Blazer (2009) 176 Cal.App.4th 1438, 1445, citing 2 Kirkland et al., Cal. Family Law: Practice and Procedure (2009) Spousal Support Orders, § 51.33, p. 51-31.) And the trial court was within its discretion to consider only Steve's salary as reflective of the marital standard of living during that time in light of the considerations discussed above.

22 Earnings from January 2007 through November 2007 should be included in the marital standard of living analysis, however, since the period of separation did not begin until November of that year.

In a separate but related argument, Carla contends that the court's exclusion of Steve's nonrecurring income from its calculation of the marital standard of living and his income available for support was erroneous because the income the court excluded as nonrecurring in fact recurred every year and "comprised a major part of his historical and prospective income." She represents that in 2007 Steve's total income was $702,487, with a base pay of $329,940; in 2010, his total compensation was $1,824,552, with a base pay of $209,749; and as of March 15, 2014 (shortly before the start of trial), his year-to-date salary was $93,750, while his earnings-to-date for that year were $3,619,759. According to Carla, "His annually recurring bonuses and other employment perks constituted the largest segment of his annual income—yet they were excluded from consideration as part of the marital standard of living." We have already addressed why it was not error for the court to exclude that income for purposes of evaluating the marital standard of living from 2007 to 2010. As to the court's exclusion of it in its consideration of Steve's ability to pay spousal support (§ 4320, subd. (c)), we again conclude there was no error.

Since, as noted, no statute defines income for the purpose of determining spousal support,²³ this is a discretionary determination. The trial court here excluded from its determination of Steve's income available for support all of his nonsalary earnings, such as bonuses, PSP awards, and S-SARs, doing so on the theory that they were nonrecurring, even though, as Carla notes, they occurred with some frequency (albeit not every year, as she contends). We need not decide whether the court's exclusion of these earnings in their entirety based on their variability constituted an abuse of discretion, however, because Carla fails to demonstrate how inclusion of these sums in the determination of Steve's ability to pay spousal support would have altered the outcome.

23 In contrast, section 4058, subdivision (a), defines income for child support purposes.

The court's nominal spousal support award was limited not by Steve's inability to pay a greater amount, but rather by the court's consideration of all section 4320 factors—and its finding that Carla was already self-supporting at the marital standard of living. So, even if the court included Steve's nonrecurring income in evaluating his ability to pay support, nothing in the record suggests this would have altered the outcome. This is because spousal support is not calculated based on how much the supporting party can afford, but rather on the needs of the supported party. (Marriage of Smith, supra, 225 Cal.App.3d at p. 486 [rejecting wife's claim that the law required the husband to pay her an increased amount of spousal support because he could now afford it]; In re Marriage of Slater (1979) 100 Cal.App.3d 241, 249-250; In re Marriage of Aufmuth (1979) 89 Cal.App.3d 446, 458-459, overruled on another ground in In re Marriage of Lucas (1980) 27 Cal.3d 808, 815; In re Marriage of Roesch (1978) 83 Cal.App.3d 96, 103; In re Marriage of Clark (1978) 80 Cal.App.3d 417, 425-426.) Everything in the record suggests that Steve's income, exclusive of the nonrecurring earnings, was sufficient to pay Carla spousal support in an amount that would enable her to live at the marital standard of living, whatever the court determined that to be.

7. The Trial Court Did Not Abuse Its Discretion When It Imputed Investment Income on All of Carla's Investible Assets, Including Funds She Wanted to Use to Purchase a House

In its SOD, the court rejected Carla's argument that her investible assets of $3,084,684 should be decreased by at least $1.7 million because she wanted to use those funds to buy a house, having this to say: "The Court finds Carla's testimony regarding the home purchase to be inconsistent, not credible and lacking in support. Carla states she plans to own a home, but does not believe she can purchase one for $1.7 million. She testified, as did her expert, that Carla will not qualify for any mortgage yet there was no evidence that she ever applied for a home loan. Moreover, Carla has not yet purchased a home and it would be speculative to believe that she will indeed make such a purchase in the near future. For example, Carla testified during the trial that she believes that she is entitled to over $70,000 per month in spousal support for the rest of her life, and that if she does not get the support she believes is fair, she will move back to Europe. Based on this testimony, it is reasonable to conclude that she will not purchase a home, if at all, until the support issues are determined. Finally, Carla provided no evidence to the Court that she has looked beyond the three most expensive neighborhoods in San Francisco for housing, and there was no evidence of the housing/condo costs in Noe Valley, which is where the parties first lived when they came to San Francisco."

As will be seen in connection with appeal No. A145262, despite this clear direction from the court, in November 2014, Carla purchased—with all cash—a $1.812 million home in the lower Pacific Heights neighborhood of San Francisco. She now contends it was an abuse of the trial court's discretion for it to hold that she "was not entitled to buy a less expensive home for herself and the children" and to "charge her with income on the money that she used to purchase it." We take exception with Carla's characterization of what the court did: it did not hold that she was not entitled to purchase a home; it ordered her to manage her finances in a way that would produce income for her. That aside, the court did not abuse its discretion in imputing investment income on all of Carla's investible assets, including funds she wanted to use to purchase a home.

Carla cites only one case—In re Marriage of Kennedy (1987) 193 Cal.App.3d 1633 (Marriage of Kennedy)—in support of her position that she was entitled to shelter over half of her investible assets for the purchase of a luxury home and thus the trial court should not have imputed investment income on those funds. The case is unavailing. In Marriage of Kennedy, the couple separated after nearly 20 years of marriage. During the marriage, the husband (a physician) and the wife (a stay-at-home mother of three) acquired a family residence and a condominium. As part of the dissolution, the parties stipulated that the two properties would be sold and the proceeds used to equalize the division of community assets and debts, with the wife afforded the opportunity to purchase the condominium. The final judgment of dissolution ordered the husband to pay the wife $2,500 per month in spousal support until the residences were sold and the wife's investment income equaled $2,500 per month. (Id. at pp. 1636-1637.) The family residence was sold, and the wife received $250,000 in sale proceeds, half of which she used to purchase a $225,000 home and half of which she invested. The husband then stopped making spousal support payments on the theory that the wife's proceeds from the property sale were sufficient to generate a monthly income of $2,500, thereby eliminating his spousal support obligation. The parties both filed orders to show cause concerning the husband's support obligation. The trial court found that if the wife had invested the $250,000, she would have received $2,080 per month in investment income. Based on this and other findings, it reduced the spousal support award to $1,000 per month. (Id. at pp. 1637-1638.)

The Court of Appeal reversed. It noted that the wife's purchase of the new house was reasonable and that she "was entitled to live at the same standard of living that she had become accustomed to during the marriage." (Marriage of Kennedy, supra, 193 Cal.App.3d at p. 1639.) It further noted that the spousal support order omitted any "express language requiring [the wife] to make any investments, let alone income-generating ones," and thus interpreted the trial court's order to read that "if [the wife] invested the proceeds, [the husband's] support obligation would drop to zero when the investments produced a $2,500-a-month income." (Id. at pp. 1639-1640.) In light of this, the court concluded it was error for the trial court to impute investment income on the entirety of the wife's proceeds from the house sale, although "it would have been within the court's discretion to consider the rate of return earned on the balance of the property division after purchase of the home." (Id. at p. 1641.) These facts are readily distinguishable from this case.

Most significantly, the court in Marriage of Kennedy agreed that the wife's purchase of a replacement residence was reasonable because she was entitled to live at the marital standard of living, and during the marriage the couple owned a family residence and a condominium. (Marriage of Kennedy, supra, 193 Cal.App.3d at p. 1639.) In contrast, Carla desired to purchase a $1.8 million home, despite that she and Steve never owned pricey real estate, having lived in rentals most of their married life. And they certainly never owned a home in which they had such enormous equity. Additionally, the SOD ordered Carla to manage her finances in a way that enabled her to become self-supporting, while any such requirement was missing from the judgment of dissolution in Marriage of Kennedy. Thus, the case does not support Carla's claim that she was entitled to deplete her investible assets by using over half of them to purchase a home, the likes of which she and Steve never owned during their marriage. It was not an abuse of discretion for the trial court to impute investment income on all of Carla's investible assets.

Carla's erroneous position on this issue can be attributed to her mistaken belief that because Steve purchased a $2 million home in the Marina District, she was entitled to purchase a luxury home in San Francisco as well. But where, as here, one spouse's postseparation earnings enable that spouse to live at a higher standard of living than the couple did during the marriage, the supported spouse has no claim based merely on this disparity. (Marriage of Ackerman, supra, 146 Cal.App.4th at p. 209.)

8. The Court Did Not Hold That Temporary Spousal Support Can Be a Prepayment of Permanent Spousal Support

Section 4320, subdivision (n), required the trial court to consider other "just and equitable" factors. As to this, the court found: "Steve has paid spousal support for four (4) years and seven (7) months, not including contributions to Carla's support during the parties' marital gap from November 2007 through March 2010. [¶] Since March 2012, Carla has received $42,896 per month in spousal support. [Citation.] Steve's spousal support obligation has been fulfilled. Regardless of what analysis is applied, the significant temporary support payments from Steve to Carla were more than double what she should have received in permanent support. The Court finds that Carla's support was front-loaded and that Steve's obligation has been fulfilled by said payments."

Carla takes exception with this finding, contending it "evidences a gross misunderstanding of the purposes of temporary spousal support and its relationship to permanent spousal support," and that it was error for the court to hold "that temporary spousal support can be a prepayment of permanent spousal support." There was no error.

First, the court did not, as Carla claims, hold that temporary spousal support can be a prepayment of permanent spousal support. The very language Carla cites belies her claim. Moreover, a reading of the SOD as a whole makes it clear that the rationale for the court's ultimate order was consideration of the section 4320 factors. In re Marriage of Gruen (2011) 191 Cal.App.4th 627, 639, cited by Carla, does not compel a different result. That case rejected the trial court's retroactive modification of a temporary support order, which is not what occurred here.

9. The Trial Court Did Not Abuse Its Discretion in Applying the Section 4320 Factors

Carla next challenges the trial court's consideration of the section 4320 factors, contending it "misapplied" a number of the factors. She submits that "[w]hether reviewed de novo for failure to properly interpret section 4320 or failure to follow decisional law from higher courts, or as a pure abuse of discretion, the order, both as to amount and duration, should be reversed." As detailed above, we agree as to one factor Carla cites, that is, the needs of each party based on the standard of living established during the marriage (§ 4320, subd. (d)). As to the other factors with which Carla takes exception, we conclude there was no abuse of discretion.

Attacking the court's analysis of Steve's ability to pay support (§ 4320, subd. (c)), Carla contends the court "mentioned . . . but never discussed it[,] probably because it put all of its eggs in the 'Carla doesn't need support' basket." She then goes on to complain that the court disregarded the "huge disparity" in their incomes, observing, "Steve's income for 2014 through March 15th was over $3 million, yet Carla was imputed $36,000 per year and terminated. Her imputed income was less than 1% of Steve's actual earnings. The trial court failed to consider this." In fact, the court did discuss Steve's ability to pay, noting he earned an annual base salary of $450,000 with the potential for additional income, and that he had the ability to obtain employment at the same base salary if he left his employment at Genentech. We see no need for the court to have said more, given that spousal support is driven by the supported spouse's needs and that there was no question about Steve's ability to pay sufficient support to meet Carla's needs—whatever the court determined those to be. (In re Marriage of Aninger (1990) 220 Cal.App.3d 230, 241 [husband's increased income post-dissolution was not a change in circumstances for modifying spousal support because it had no bearing on wife's ability to become self-supporting].) While spousal support awards often focus on the supported spouse's needs and the supporting spouse's ability to pay, in many marital dissolutions "this emphasis on need and ability is necessary and realistic because the income and assets of the parties are not sufficient to maintain two households at the marital standard." (Marriage of Ostler & Smith, supra, 223 Cal.App.3d at p. 46.) That was not the case here.

Carla further evidences her misunderstanding of the section 4320, subdivision (c), factor by repeatedly reminding us of Steve's post-separation earnings and insisting that the court should have awarded her more support because those earnings were so much greater than hers. But a disparity in post-separation earnings does not justify a greater award of spousal support, as the court in Marriage of Ackerman, supra, 146 Cal.App.4th 191, made clear. Rejecting the wife's argument that the trial court abused its discretion because the support order left the parties at significantly different standards of living, the court held as follows: "[A] trial court is not required to consider a supporting spouse's postseparation income in awarding spousal support. [Citation.] Although 'an increase in postseparation income may be considered for purposes of bringing the supported spouse's level of support up to that necessary to maintain the parties' marital standard of living[, w]here, as here, an award based on marital income level is sufficient to sustain the marital standard of living, there is no occasion to draw upon postseparation income. "It is [the supported spouse's] needs which must be examined, not [the supporting spouse's] standard of living due to post-separation separate property earnings." [Citation.]' [Citation.] [Marriage of Ostler & Smith, supra,] 223 Cal.App.3d 33, which wife cites, does not persuade us otherwise. That case merely held the trial court did not abuse its discretion in awarding additional support based on a percentage of the supporting spouse's future bonuses. [Citation.] [¶] Wife maintains that the court abused its discretion because the support order 'leaves the parties at significantly different standards of living . . . .' But equality of postseparation income is not an element of section 4320 in setting spousal support. [Citation.] At best, the marital standard of living entitled wife to financial support commensurate with her lifestyle before she and husband separated. Although the law protected her from a precipitous drop in her standard of living after her divorce, it did not guarantee her dollar-for-dollar equality between her postseparation income and husband's. (In re Marriage of Hoffmeister (1987) 191 Cal.App.3d 351, 363 [support award 'must bear some relationship to the standard of living of the parties during their marriage and not the [postseparation] standard of living of the supporting spouse'].)" (Marriage of Ackerman, at p. 209; see also Marriage of Smith, supra, 225 Cal.App.3d at p. 487.)

The California Judges Benchguide on Child and Spousal Support confirms this principle: "A spouse's high income may be considered with respect to his or her ability to pay support. But the fact that a high income enables this spouse to maintain a standard of living that is higher than the marital standard of living does not mean that the supported spouse is entitled to an amount of support that will allow the supported spouse to also maintain a higher standard of living." (Cal. Judges Benchguide: Child and Spousal Support (CJER 2015) § 201.87, pp. 201-65-201-66, citing Marriage of Cheriton, supra, 92 Cal.App.4th at pp. 307-308; In re Marriage of Weinstein, supra, 4 Cal.App.4th at p. 568; In re Marriage of Hoffmeister, supra, 191 Cal.App.3d at p. 363 [error to increase support based on supporting spouse's ability to pay, unlimited by standard of living during marriage].)

Carla next complains that the court "totally failed to discuss or weigh the fact that [her] future earning capacity was impaired by her moves all over the world to support Steve's career." Section 4320, subdivision (a) requires the court to consider "[t]he extent to which the earning capacity of each party is sufficient to maintain the standard of living established during the marriage," taking into account "[t]he 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."

In calculating Carla's future earning capacity, the court imputed to her an annual income of $36,000, a modest income that certainly recognized the realities of her earning capacity given that she had been a stay-at-home mother for over 10 years. She complains that the court "simply assumed that after being out of the workforce for 14 years, [she] could develop the computer skills necessary and find a job that would pay her $36,000 per year in less than four months from a standing start." The court did not make this assumption out of whole cloth—it was based on a vocational evaluation and Carla's education, abilities, and work history. Carla does not offer any argument that the vocational evaluation was flawed or for some reason unreliable. And, in fact, the evaluation underestimated her earning capacity, as by August 2014 she increased her income to $51,288 plus commissions.

Similarly baseless is Carla's attack on the court's consideration of the extent to which she "contributed to the attainment of an education, training, a career position, or a license by the supporting party." (§ 4320, subd. (b).) As to this factor, the court stated: "Carla supported Steve over the course of their marriage frequently moving from country to country so Steve could pursue and build his very successful executive career for leading global companies. Steve affirmed that Carla contributed to his ability to change jobs by being home with the children, while he advanced his career. [¶] The Court finds that Carla stayed home to raise the children when they were very young so that Steve could concentrate on his career. The Court finds that the move to London following Steve's and Carla's education at Harvard University was a mutual decision and not based on Steve's career. Similarly, the decision to move to Oslo, Norway in 2000 and Basel, Switzerland in 2004 was a mutual decision for the parties and not based solely on Steve's career. The Court finds that the decision to move to the U.S. in 2009 was a decision based on a job opportunity to Steve and that Carla did not come to the U.S. right away and moved to Paris for just under a year after moving to the U.S. The Court finds that Carla moved to San Francisco so that the children could be close to Steve."

Carla labels the court's consideration of this factor " 'unnuanced,' " but her disagreement ultimately comes down to the weight the court afforded this factor. That weight lies strictly within the trial court's discretion (Marriage of Ackerman, supra, 146 Cal.App.4th at p. 207), and there was no abuse of that discretion here.

Nor is there any merit to Carla's criticism of the court's statement that it "may consider the child support she will receive as income to satisfy the marital standard of living." Carla contends that because receipt of child support is not a section 4320 factor, the court was without legal authority in considering this. In claimed support, Carla cites Marriage of Ackerman, supra, 146 Cal.App.4th 191, but like the supported wife in that case, she takes the trial court's statement out of context. In Marriage of Ackerman, the trial court found that the wife should be able to meet the standard of living " 'with a combination of child support, spousal support, and reasonable interest' from the assets awarded, along with the $3,000 monthly income imputed to her." (Id. at p. 210.) The Court of Appeal rejected the wife's claim that "it was improper for the court to find some of her individual 'needs would be satisfied by the payment of child support,' " explaining that the trial court "never said that and wife has not cited any authority providing that child support may not be considered in determining whether the marital standard was met." (Ibid.) Likewise here, where the trial court specifically found that based on her imputed income, Carla was self-supporting at the marital standard of living. The court did not include child support in that finding, and it did not terminate Carla's spousal support based in part on the child support she was receiving.

At the end of the day, other than the defects in the court's consideration of the parties' respective needs based on the marital standard of living, Carla's claim that the trial court misapplied other section 4320 factors is nothing but a disagreement with the weight given those factors. It was within the court's discretion to determine the weight each factor merited.

10. The Trial Court Did Not Abuse Its Discretion in Not Awarding Carla Additional Support Based on the Excess Income Steve Received After the March 31, 2010 Stipulated Date of Separation

In its SOD, the trial court declined to award Carla additional spousal support based on the excess income Steve received from Genentech. Carla contends this was error, as the court should have awarded her a percentage of Steve's future bonuses and other nonrecurring income—known as an Ostler-Smith award—in recognition of her contribution to the family's upward mobility.

Marriage of Ostler & Smith, supra, 223 Cal.App.3d 33, was a husband's appeal from a spousal and child support order that contained an escalation provision based on a percentage of the husband's future bonuses over and above the fixed monthly amounts of support. (Id. at p. 36.) The couple married in 1964 when they were both 17 years old and the husband had just begun his first year of college. He followed up his undergraduate degree with graduate school, receiving a master's degree in banking. When the couple separated in 1986, he was an auditor of a major bank. By the time of the 1988 hearing on support, he had become an executive vice president and the chief financial officer. His annual salary had increased from $15,216 in 1971 to $165,000 plus a bonus of $135,000 and other generous benefits in 1988. (Id. at pp. 37-38.)

As to the wife, while the husband was a full-time college student, she helped support the family by doing housecleaning, ironing, and babysitting. Once they had children, she stayed home, taking total responsibility for the children's upbringing while the husband devoted his time to his career. While the wife did take a few college courses during the marriage, she did not work outside the home, except for the minor jobs while the husband was in school. (Marriage of Ostler & Smith, supra, 223 Cal.App.3d at p. 39.)

The husband urged the trial court to base its support award only on his fixed salary, alternatively urging that if it did consider his annual bonus, to award only a percentage, with a ceiling of $1,000 per month. The wife, on the other hand, sought support based on the husband's total income, including his annual bonus. (Marriage of Ostler & Smith, supra, 223 Cal.App.3d at p. 40.) After analyzing the husband's ability to pay support, the wife's earning capacity, and the wife's and children's needs in order to live at the marital standard of living, the trial court found the wife needed $5,859 per month to meet the reasonable needs of herself and the children, which was the equivalent of what it found the husband was able to pay based on his salary alone, and thus ordered the husband to pay $5,900 in monthly child and spousal support. The court did not stop at that, however. As to the husband's future bonus income, the trial court observed: " 'No future bonus is guaranteed. It would therefore not be appropriate to base a support order on Husband's bonus income and then require him to file motions to modify at such times as the bonus is reduced. It would be more fair to all parties to base the support order on Husband's income from salary and dividends, and to allocate a portion of the future bonus income to the children and to Wife by way of a percentage interest so that future litigation will not be necessary as the bonus income changes.' " (Id. at pp. 41-42.) It then ordered the husband to pay additional support of 15 percent of his annual bonus in spousal support and 10 percent in child support. (Id. at p. 42.)

On appeal, the husband argued that the order "violate[d] the established rule that spousal support is limited by the supported spouse's needs in order to continue living at the standard established during the marriage." (Marriage of Ostler & Smith, supra, 223 Cal.App.3d at p. 46.) Our colleagues in Division Three disagreed, holding that a trial court is not limited by the marital standard of living and must instead consider all the circumstances and determine the weight to give each former Civil Code section 4801 (now section 4320) factor. One such factor—the extent to which the wife supported the husband in his attainment of his education and career—deserved particular consideration there, which the trial court properly recognized by awarding her a percentage share of his extra earnings for a period of time. (Marriage of Ostler & Smith, at pp. 48-49.) The court concluded that, under the facts before it, defining the standard of living by average income did not account for the family's upward mobility (id. at pp. 41, 48) and that it would be unjust to leave the custodial parent and minor children at a significantly lower plateau of living while the noncustodial parent enjoys a significantly increased income. (Id. at p. 48.)

Carla asserts that the facts of Marriage of Ostler & Smith are "eerily similar to those in this case. Like the wife in Ostler & Smith, Carla supported Steve's career and sacrificed her own career options while moving with him to five different countries and raising two children. Like Clyde Ostler, Steve is upwardly mobile with his income increasing astronomically. While it may be true that Carla is not entitled to ride up with his ever-increasing standard of living, it is also true that his upward mobility, developed during marriage, is a factor the trial court should have considered in ordering support and in apportioning his post-separation 'nonrecurring' income as additional spousal support. Instead, it awarded 100% of it to Steve."

As Carla correctly notes, the court in Marriage of Ostler & Smith upheld the support order largely due to the wife's support of the husband's career which enabled his upward mobility. But as that case itself recognized, the supported spouse's contribution to the supporting spouse's career is but one of the many section 4320 factors to be weighed by the court. While the court in Marriage of Ostler & Smith afforded heavy weight to what is now section 4320, subdivision (b), the trial court here was not bound to do so. As we have repeatedly pointed out, the weight to be given to each of the section 4320 factors is within the discretion of the trial court, and Marriage of Ostler & Smith upheld the trial court's exercise of that discretion. Likewise, in light of the numerous considerations here, we uphold the trial court's discretionary decision not to order an Ostler-Smith award.²⁴

24 We also note that the order in Marriage of Ostler & Smith contained a step-down provision, reducing the wife's spousal support to $1 within three years, this following a 22-year marriage. (Marriage of Ostler & Smith, supra, 223 Cal.App.3d at p. 42.) Here, following a marriage of just over 10 years, Carla had already received significant spousal support for over four years, including percentages of Steve's bonuses and other nonrecurring income.

II. APPEAL NO. A145262

A BACKGROUND

1. Carla's Request for Modification and Attorney Fees and Costs

On December 23, 2014, eight days prior to the termination of spousal support under the court's Richmond order, Carla filed a motion entitled "Request for Order to Modify Spousal Support, Child Support Add-Ons, Enforce Child Support Order re Ostler-Smith Child Support True-Up, and Attorneys' Fees and Costs." The motion was set for hearing on February 10, 2015, to be considered concurrently with her deferred request for prejudgment attorney fees and costs, and sought four forms of relief.

The first request was for spousal support pending the resolution of Carla's appeal or, alternatively, the extension of spousal support beyond the December 31, 2014 termination date based on a claimed change of circumstances, namely, a significant reduction in her investible assets. Carla reported that she had purchased a residence in San Francisco for $1,812,000, for which she had paid cash because she was unable to qualify for a "meaningful" mortgage. She described the home as a "relatively modest three bedroom, two bath condominium in lower Pacific Heights," which she claimed was "much more modest" than Steve's two-story condominium in the Marina. And, she added, "I have our children 50% of the time and it is in their best interests that they live in a residence that is at least somewhat comparable to the one in which they live when they are with their father. It is also in their best interests that my home be near their father's house and near the girls' school."

According to Carla, she now had $1,812,000 less in investible assets on which to impute interest income. She would also have the related expenses of property taxes, insurance, and maintenance on her residence, which she estimated to be $3,768 per month, plus an additional $2,000 per month for renovation costs. Additionally, because her financial situation was "highly volatile" and she needed to maintain access to her liquid assets for living expenses, she had not been able to approximate the 2.77 percent income on her investible assets that the court had imputed to her, earning interest at a rate of approximately 0.15 percent instead.

Carla's second claimed reason for the reduction in her investible income was her inability to sell her Paris flat and generate income from the proceeds: "I own a separate property flat in Paris that I have been actively trying to sell in good faith since before the time of the FSOD and after. There is damage to the Paris flat, including water damage from a pipe leak that has delayed my ability to rent or sell the property so I have been unable to generate any income from this asset." Carla went on to describe how one sale in particular fell through in part because of water damage, and she would have to undertake repairs before she could sell it, so not only did she not have the income from the apartment but she would incur the costs of the repairs. And, she claimed, the amount she would receive for the apartment would be less than the amount the court imputed to her.

In short, according to Carla, her liquid assets had been reduced to $496,000, while Steve had at least $7,488,087 in assets, over $5 million of which was liquid. Further, upon recently returning to the work force, Carla had initially earned $2,080 per month as a sales consultant and had just moved to a full-time position earning $51,288 per year plus five percent commission. This was in contrast to Steve's income, which exceeded $2 million per year, reaching $6 million in 2013 and $2,550,993 for the first three months of 2014 alone.

The second request in Carla's motion was for post-judgment attorney fees. First, she sought $17,395 for bringing the motion itself. Second, she sought $40,000 for her appeal, an amount supported by a declaration of Garrett C. Dailey, Carla's appellate attorney, who opined that the SOD contained reversible error and estimated the appeal would cost between $40,000 and $60,000.

The third item sought modification of the court's order that child support add-ons (e.g., private school tuition, orthodontia, and uncovered medical expenses) be paid equally. According to Carla, the order had been based upon her having investible assets of $3,000,000, but her circumstances had changed and she did not have the ability to pay those expenses without depleting her remaining capital. Given that Steve's income exceeded $1 million per year, she believed it was appropriate for him to pay those expenses.

Fourth, Carla requested Ostler-Smith arrearages, claiming Steve had underpaid child support by $1,196 based upon his September 2014 sale of S-SAR shares. She requested this amount plus statutory interest.

As noted, Carla's request for pre-judgment attorney and accountant fees had been reserved until after the trial on the support issues. Thus, in her motion, Carla reiterated her claim for fees and costs, noting that she had not received any fees since Steve's May 22, 2012 advance of $37,500. She represented that she had incurred $472,107 in fees ($277,910 for attorney fees and costs and $194,197 for forensic accounting fees), all of which she had paid from her share of the community property assets or the support she received, except for $37,500. She sought payment from Steve for all fees and costs she incurred.²⁵

25 She also represented that since trial she had paid a $30,000 retainer for Dailey and $36,000 to her trial attorney out of her investible assets on which the trial court had imputed interest income.

2. Steve's Opposition and Request for Sanctions

Steve opposed Carla's motion in all regards, arguing there had been no material change of circumstances and Carla's requests lacked good cause. He submitted his own declarations attesting that as of February 27, 2015, he had incurred $946,488 in attorney fees and costs, including $299,177 for his forensic accountants.

Steve also filed a counter-motion seeking his attorney fees and costs as section 271 sanctions. He argued that the parties incurred significant fees largely due to Carla's "unreasonable and aggressive positions regarding support." He detailed how Carla "escalated every issue into a fight and refused to take reasonable positions." For example, the parties completed mediation of their divorce in 2009 and signed a divorce agreement in February 2010 based on the mediation, but Carla reneged on those agreements and insisted on October 2011 as the date of separation, despite that she moved to Paris in 2010 with her boyfriend of three years.

As other examples of Carla's obstreperous behavior, Steve cited her lack of cooperation with regard to negotiating a protective order that was necessary in order to obtain certain records from Steve's employer. She also filed a motion to reduce his time with the children (then 43 percent), the outcome of which was not only denial of her motion but a modification to a 50/50 time share.

Additionally, Steve argued that he carried the laboring oar throughout the litigation. Despite Carla's expert being retained in June 2012 and generating invoices for work he was doing, Steve's expert Good did all of the leg work and preparation with respect to dividing the parties' assets, and his analysis enabled the parties to enter into a settlement agreement regarding the division of property.

Steve also detailed how Carla repeatedly frustrated settlement negotiations, which forced the parties into a costly trial on support issues. Similarly, her "outrageous" demands for support based on her " 'proposed needs' " identified in her "fraudulent" IEDs—needs she repeatedly identified as exceeding $70,000 per month—were "a major source of the Parties' inability to settle." Because this conduct unreasonably increased the cost of the litigation, he asked that Carla not be awarded attorney fees and instead that she pay a substantial portion of his fees. Alternatively, he requested that both parties bear their own fees and costs.

3. Carla's Reply

Carla's reply reiterated the main points raised in her moving papers—that her home purchase and unsellable Paris apartment diminished her investible assets, her monthly income of $7,807 was inadequate to meet her needs of over $20,000 per month, and the disparity in the parties' financial positions mandated an award of attorney fees in her favor.

4. The Trial Court's Decision

On May 7, 2015, the court issued its statement of decision on Carla's motion and the reserved issue of prejudgment attorney fees (SOD2). It was, to put it mildly, not favorable to Carla, who in her opening brief on appeal describes the court's findings as "scathing." We discuss the court's lengthy decision in detail, including quoting substantial portions of it, because the court's numerous findings in its own words are critical to the disposition of the issues before us.

Among the findings pertinent here, the court found that Steve took the laboring oar in the litigation in synthesizing the financial information and providing the court with a complex marital standard of living analysis. Additionally, his forensic accountant prepared the analysis of the parties' assets which led to the agreement regarding property division, while Carla's forensic accountant made no contribution to the analysis.

It was also evident to the court that Carla's conduct had driven up the fees incurred by both parties:

"Carla has chosen to protract litigation despite a history in this case that should have allowed the parties to resolve matters. Carla and Steve had several periods of separation during their marriage and finally in 2008 and 2009, they mediated their divorce in Switzerland. Steve paid the costs of that mediation which resulted in the Parties entering into an executed Agreement on Divorce in January 2010. Steve and Carla even told friends and family they were getting divorced. After Carla arrived in the United States and filed her Petition for Dissolution, however, she no longer appreciated the terms of the Agreement. Carla contested its validity and enforceability and in December 2012, and after months of fighting and incurring fees, Steve agreed to not enforce the Agreement.

"Carla also disputed the date of separation, causing the parties to enter into a protracted process incurring significant fees. In addition, due to Carla's lack of cooperation, it took months of negotiating before a protective order regarding Steve's employment and benefits with Genentech/Roche, was finally executed.

" . . . In addition, Carla filed a motion challenging the custody of the parties' two minor children in July 2012, seeking to reduce their time with Steve. Ultimately, the Court denied Carla's motion. Thereafter Steve and Carla stipulated to a 50%/50% timeshare which ended up giving Steve more custodial time with the children than what the historical timeshare had been before Carla filed her petition for dissolution in April 2012."

The court also found that Carla did not engage in meaningful settlement negotiations, in support of which it detailed Steve's many attempts to resolve the case and Carla's consistent rebuffing of those attempts, as follows:

"On June 21, 2013 the Parties attended their first Mandatory Settlement Conference led by panelists Andrea Palash and Vanessa Hierbaum. At the time, Carla's expert had not prepared a marital standard of living analysis and the only one available was that of James Good, CPA, Steve's expert forensic accountant. Despite only having the financial information from Steve, the panelists made recommendations regarding post-judgment spousal support and further suggested that Carla undergo a vocational examination.

"In a written proposal to Carla, Steve accepted the recommendations of the panelists because he was interested in resolving the issue so the Parties could move on and stop incurring so many fees; both attorney and accountant. The recommendations were, in Steve's opinion, very generous to Carla and exceeded the amount he had been paying pursuant to the prior mediation agreement and the amount this Court ultimately ordered. However, Steve felt that avoiding litigation and paying what Ms. Palash and Ms. Hierbaum recommended outweigh the costs and stress associated with going to court. Carla rejected the proposal.

"On August 1, 2013, Steve made the first of four (4) global settlement proposals to Carla, which followed Ms. Palash's and Ms. Hierbaum's (June 21, 2013, MSC panelists) recommendations on permanent spousal support which provided for nine (9) years of spousal support, but Steve offered an additional year of support. Again, Carla rejected the proposal.

"On November 1, 2013, the Parties attended their second Mandatory Settlement Conference led by panelist Melinda Sammis. At the time, Carla's expert still had not prepared his analysis and only had information from Steve's expert, Mr. Good.²⁶ Ms. Sammis made a recommendation based on Ms. Palash and Ms. Hierbaum's recommendation which Steve accepted and re-proposed to Carla. Again, Carla rejected the proposal.

26 In a footnote, the court observed, "It is important to note that, according to invoices provided by Mr. Miskei, Carla had already incurred $85,460.02 and paid $83,460.02, after receiving a $2,000 'courtesy discount' of $2,000 in January 2013. However, Carla never produced any analysis by Mr. Miskei prior to the settlement conferences."

"Finally, on November 19, 2013, in a third attempt to settle this matter, the Parties attended private mediation with David Sutton. The parties did not reach an agreement.

"On November 21, 2013, Steve re-proposed his settlement proposal. Not only did Carla reject the proposal, but she countered, on December 2, 2013, with an offer that doubled the amount of support Steve proposed and extended the length of time Carla would receive the spousal support. Carla was essentially requesting that she receive double the support for a period equal to the length of the Parties' marriage. Steve did not accept the offer.

"On February 23, 2014, Carla reached out to Steve requesting that they engage in settlement discussion one (1) more time before engaging in expensive trial preparations. Steve responded on March 4, 2014, agreeing that they should work together to settle, at the very least, post-judgment spousal support. He reiterated his last offer 'as is' hoping that Carla would finally appreciate how generous it was. Carla rejected the offer.

"On March 21, 2014, Steve's counsel attempted to resolve the issue of Carla's income by proposing that the parties agree on an imputation of income to Carla commensurate with the vocational evaluation performed by Marlis Bruns. The proposal included gradual increases of imputation based on the recommendations of Ms. Bruns that Carla receive training to become more marketable. Carla rejected the proposal, instead opting to call Ms. Bruns as a witness at trial, further increasing the costs of litigation.

"On March 31, 2014, after receiving analysis from both Parties' experts on the marital standard of living, Carla made a settlement proposal using Steve's own proposal as the basis of her proposal, after rejecting his proposal out of hand on two (2) prior occasions as 'unreasonable.' This establishes that Carla understood it was a favorable deal for her, now that her accountants had finally prepared a marital standard of living analysis based on what the Parties spent in the three (3) years prior to separation.

"In addition to Steve's proposal, Carla added to her offer another $1,500,000 in support over the next (9) years, 15% of any income he receives that exceeds $2 million in a year for five (5) years, $100,000 in attorney fees and costs, and an additional request for $789,249 from Steve to Carla for a Smith Ostler payment on the sale of certain SSARS and TPSP shares, in addition to $129,417 for bonus support on the cash bonus Steve received. Steve rejected the offer after consideration of the amount of fees incurred in preparation for trial.

"After much consideration of the analysis by both experts and after incurring additional fees to prepare for trial already, on April 15, 2014, Steve made a counter proposal considering the Parties best and worst case scenarios. Carla's counsel rejected Steve's counter-proposal without providing specific feedback or clarification as to which terms she took issue. Steve resent the offer requesting a detailed response or counteroffer.

"On April 25, 2014, Steve made one final attempt to re-propose his generous settlement proposal in a last ditch effort to resolve this matter before enduring trial. Two days later, Ms. Bley rejected the proposal and the Parties began trial on April 29, 2014.

"After five (5) full days of trial, on May 23, 2014, Ms. Bley sent a settlement offer on behalf of her client in what she claims was 'one last effort of settlement before the last two days of trial.' The letter [began] by criticizing Mr. Good's expertise and analysis, and took issue with Steve's positions at trial. Ms. Bley concluded by premising [sic] Carla's former settlement offer stating 'we believe your client should not [sic] view the following proposal as better than he can reasonably expect at Court and one which will buy him the certainty and closure he has stated he desires.' Finally, she re-offered Carla's proposal—which was actually Mr. Sutton and Steve's proposal that she had previously rejected outright—with the exception that Carla was now requesting $400,000 rather than the $300,000 she initially proposed. Accordingly, Steve did not respond to this offer."

The court also found that Carla's unwillingness to negotiate continued after the trial. After the court issued its SOD, Steve reached out to her and proposed that the parties each bear their own fees. Carla rejected the proposal, refusing to provide a counterproposal and insisting instead on proceeding to trial on the issue.

The court also found that Carla's support demands based on her "exaggerated" IEDs were a major source of the parties' inability to settle. She produced three IEDs that inflated her proposed need and lacked credibility. For example, in her preliminary IED, she identified proposed needs of $71,770, which included $4,000 per month for clothing alone. She sought $30,000 in monthly savings, as well as mortgage, maintenance and other expenses for a home she had not yet purchased. She listed proposed expenses for a swimming pool when the parties had never lived in a home with a pool. A subsequent IED listed her proposed monthly needs as $73,141 and another at $75,048. In short, the court found that "Carla's continued demand for monthly support in excess of $70,000 was not based in reality."

The court also noted that Carla's IED accompanying her motion did not include any savings, which, according to the court, "indicates that she has maintained her trial position that she should not be required to utilize reasonable investment practices relating to the approximately three (3) million dollars issued to her in September 2013. Her money remains in a bank account earning little or no interest (.15%) where Carla states it will remain until she has 'an opportunity to develop a long term financial strategy.' [Citation.] Thus, and by her own admission, Carla chose to spend over half of her liquid assets, $1.8 million dollars, without first developing a long term financial strategy."

Additionally, in that most recent IED Carla represented that she received only $3,535 per month in child support. This, the court pointed out, "fail[ed] to include the actual child support she receives from Steve for additional bonus support, totaling approximately $21,000 per month. While Carla now claims she is unable to rely on Steve's bonus income in the future (another position that is contrary to the position she and her expert took at trial), she fails to even mention the $94,000 Ostler-Smith bonus she knew she had already accrued and had been partially paid when she filed the IED."

After making these numerous findings, the court reevaluated the section 4320 factors, concluding that many had not changed since the SOD. In particular, concerning the parties' obligations and assets (subdivision (e)), the court found:

"Carla's unilateral decision to spend over $1,800,000 in cash on a home in Lower Pacific Heights does not constitute a change of circumstances. Carla attempts to shield her assets from consideration through a contrivance. She has an obligation to invest and properly manage her assets. In fact, the Court found that Carla had an affirmative obligation to 'manag[e] her finances, including her savings, in a manner that will produce income for her.' [Citation.] Carla can't hide her duty to achieve self-support, by hiding her assets, and attempting to circumvent the justice of existing orders much the same as a party cannot quit his or her job to circumvent a support order. While it is true that Carla has the right to purchase a home, she must do so within the context of the other obligations set forth in the Statement of Decision. Put another way, once Carla received the Court's final statement of decision, she was free to purchase a home but not to purchase a home in a manner that allowed her to circumvent her obligations. In the letter submitted by her realtor, even assuming it was a proper form of evidence, Carla purchased a home by expanding her search to 'Lower Pacific Heights.' Carla could have expanded her search to any other area of the city that would meet her needs as well, or simply continue to rent an apartment until she found a home that was suitable given her financial situation. In addition, Carla admitted that she purchased the home without a long term financial plan in place. For all these reasons, the fact that Carla purchased a home for $1.8 million is not a material change of circumstances warranting a modification of support."

On the other hand, the court found that Carla's inability to rent or sell the Paris flat due to the water damage was a material change in circumstances.

The court then ruled on the relief Carla requested. It extended the spousal support award for an additional 14 months, from January 1, 2015 through February 28, 2016, again pursuant to a Richmond order. It denied her request for the continuation of spousal support pending her appeal. It granted her request concerning child support add-ons as to the children's private school tuition due to the changed circumstances regarding the Paris flat but denied the request as to any other add-on expenses. And it agreed with Carla that Steve had underpaid by $1,196 the Ostler-Smith child support bonus based upon his September 2014 sale of S-SAR shares, although the court excused it as a "good-faith" error. It ordered Steve to pay the amount owed plus 10 percent interest.

The court then turned to the issue of attorney fees. It noted that the parties each received approximately $3.1 million dollars as their respective separate property estates. Carla additionally received $3,535 each month in base child support and received $5,000 each month in spousal support until the end of 2014. She had also received approximately $94,000 since August 2014 in bonus support and was scheduled to receive further bonus income throughout the year. It found that Carla violated her obligation to invest her assets by using over $1.8 million to purchase a house and leaving the rest of her money in a bank earning interest at a rate of 0.15 percent. Steve, the court found, had "greatly contributed toward the community fees," paying 65 percent of the fees to Carla's 35 percent. In the court's opinion, shifting the burden of the entire litigation to Steve was "not the intention of the legislature, nor is it equitable based on the facts of this case."

In light of all this, the court ordered the parties to bear their own expenses, including fees pertaining to Carla's motion and her appeal.

Briefly addressing Steve's motion for section 271 sanctions, the court found that he had "carried his burden of proof and the Court would impose § 271 sanctions against Carla" but nevertheless denied his request without prejudice to refiling his motion "[t]o the extent the orders of this Court are reversed in whole, or part, by the Court of Appeal . . . ."

On May 14, 2015, Carla appealed from the May 7 order (No. A145262). We ordered Carla's two appeals consolidated.

B. DISCUSSION

1. Carla's Contentions

In her appeal from the SOD2, Carla asserts that the trial court committed reversible error in denying her fee requests, and that it abused its discretion in finding that her purchase of a home was not a change in circumstances for purposes of modifying spousal support.

2. The Trial Court Did Not Abuse Its Discretion in Denying Carla's Request for Additional Prejudgment Fees or Fees for Her Appeal

In a marital dissolution action, the trial court "shall ensure that each party has access to legal representation" by ordering one party to pay to the other party "whatever amount is reasonably necessary for attorney's fees and for the cost of maintaining or defending the proceeding . . . ." (§ 2030, subd. (a)(1).) "When a request for attorney's fees and costs is made, the court shall make findings on whether an award of attorney's fees and costs under this section is appropriate, whether there is a disparity in access to funds to retain counsel, and whether one party is able to pay for legal representation of both parties. If the findings demonstrate disparity in access and ability to pay, the court shall make an order awarding attorney's fees and costs. . . ." (Id., subd. (a)(2).)

Both the making of the award and its amount must be "just and reasonable under the relative circumstances of the respective parties." (§ 2032, subd. (a); In re Marriage of Cryer (2011) 198 Cal.App.4th 1039, 1056 [§ 2032 requires court to engage in broad analysis of parties' relative circumstances].) In determining what is just and reasonable under the circumstances, section 2032, subdivision (b) directs the court to consider the section 4320 factors. This means that " ' "[f]inancial resources are only one factor for the court to consider in determining how to apportion the overall cost of the litigation . . . ." ' " (In re Marriage of Dietz (2009) 176 Cal.App.4th 387, 406 (Marriage of Dietz); In re Marriage of Falcone & Fyke (2012) 203 Cal.App.4th 964, 974-975.) It also means the court may consider section 4320's catchall: "Any other factors the court determines are just and equitable." (§ 4320, subd. (n); In re Marriage of Smith (2015) 242 Cal.App.4th 529, 533.)

The trial court enjoys broad discretion in awarding attorney fees in a marital dissolution action. (In re Marriage of Sullivan (1984) 37 Cal.3d 762, 768.) Its decision whether and in what amount to award attorney fees and costs is reviewed for abuse of discretion.²⁷ (Marriage of Cheriton, supra, 92 Cal.App.4th at pp. 282-283.) In light of the considerations outlined in the court's opinion—most notably, Carla's unreasonable positions and unwillingness to engage in meaningful settlement negotiations—we see no abuse of discretion in the court's allocation of roughly two-thirds of the fees to Steve and one-third to Carla. Carla's fundamental argument to the contrary is that the trial court "totally ignored the concept of the parties' relative circumstances." Her argument is flawed for multiple reasons.

27 Carla acknowledges that an order on attorney fees is reviewed for abuse of discretion but argues we should review the fee orders de novo because "the trial court so blatantly ignored statutory and decisional directives . . . ." We disagree that de novo review is applicable.

First, Carla reads section 2030 as if it mandates a fee award simply because there is a disparity in the parties' income. But section 2030 discusses not a disparity in income but in access to funds to retain counsel, among other criteria. Here, the trial court specifically noted that Carla received $3.1 million as her separate property, was receiving $3,535 each month in base child support and $5,000 in spousal support through the end of 2014 (extended through February 28, 2016), and was receiving substantial child support bonuses, including $94,000 since August 2014. These circumstances demonstrated that Carla had access to substantial funds.

More importantly, Carla's singular focus on the disparity in the parties' financial resources disregards the guidance provided by section 2032. Subdivision (a) contemplates an award that is "just and reasonable under the relative circumstances of the respective parties" (italics added), while subdivision (b) directs the court to consider the section 4320 factors in evaluating the parties' relative circumstances, which includes "[a]ny other factors the court determines are just and equitable." (§ 4320, subd. (n), italics added.) And section 2032, subdivision (b) expressly states that "[f]inancial resources are only one factor for the court to consider in determining how to apportion the overall cost of the litigation equitably between the parties under their relative circumstances." To Carla, "the parties' relative circumstances" means simply a disparity in income; in the law, however, it means more than that—and it includes equitable considerations. Those considerations drove the trial court's allocation of fees here.

In re Marriage of Huntington (1992) 10 Cal.App.4th 1513 (Marriage of Huntington) is instructive. There, the husband was worth millions, while the wife was a dental hygienist who earned approximately $30,000 a year, although she quit working shortly before the couple married. Their standard of living during their three and one half-year marriage was extremely high. (Id. at pp. 1516, 1524.) During a trial on spousal support, the wife presented three expert witnesses who testified that she was not emotionally prepared to immediately begin self-supporting employment, and the husband presented two expert witnesses to refute the wife's evidence. (Id. at pp. 1517-1518.) The trial court awarded the wife spousal support of $5,000 per month for six months and ordered the parties to bear their own fees and costs (other than $19,000 the husband had already advanced the wife for her attorney fees). (Id. at pp. 1516, 1521-1522.) In denying the wife's request for an additional $62,000, the trial court described the fees incurred by both sides as "outrageous" and "totally unreasonable," going on to opine that the case should have cost no more than $10,000 in attorney fees and $5,000 to $6,000 in professional fees and only exceeded those amounts because the husband had money. (Id. at p. 1524.)

The Court of Appeal affirmed the order denying the wife's fee request, among other things. (Marriage of Huntington, supra, 10 Cal.App.4th at pp. 1524-1525.) It observed that the trial court was in a better position to assess her contention that the high fees resulted from the husband over-litigating the case and had found the contention lacking, believing instead that the wife's unreasonable litigation conduct had escalated the fees. The Court of Appeal found nothing suggesting that conclusion was an abuse of discretion or that reversal of the fee denial was warranted, even despite the significant disparity in the parties' finances. (Ibid.) The same can be said here. The trial court was in the better position to evaluate the parties' litigation conduct, and it unquestionably believed that Carla's positions and tactics were unreasonable and greatly increased the fees of both parties. The record supports the trial court's opinion in this regard, and, like the Court of Appeal in Marriage of Huntington, we cannot say it was an abuse of discretion to allocate the parties' combined fees as it did.

Carla disputes that her conduct escalated the fees and that she unreasonably hindered settlement, asserting that the trial court "forgot that the parties settled almost every contested issue," many of which she prevailed on. For example, she says, "Steve wanted to enforce the Swiss separation agreement, but dropped the request. Steve wanted to establish a 2007 date of separation. Carla sought a 2011 date and they settled on 2010. Carla negotiated a guideline support order where Steve's position was that she should receive nothing. How much of the fees generated were related to these issues on which Carla prevailed?" This argument is, at best, disingenuous. These were not court decisions in Carla's favor, but rather, examples of Carla taking aggressive positions in light of Steve's burgeoning income, while Steve compromised time and time again in order to end the litigation. They were not examples of how Carla's positions throughout the proceeding were meritorious, her litigation expenses reasonably incurred.

The fact of the matter is that the parties reached a global divorce agreement in Switzerland in 2009, followed by a February 2010 agreement based on the Swiss agreement with some modifications. Carla reneged on those agreements, rejected all of Steve's subsequent settlement offers, and forced the spousal support issue to trial in 2014. The support issue could thus have been resolved in 2009 or 2010, but instead Carla caused both parties to incur years' worth of attorney fees and costs by maintaining her unreasonable spousal support positions through the April 2014 trial. It was evident to the trial court—and it is evident to us—that her myopic belief, incorrect as it was, that she was absolutely entitled to astronomical sums of support and her refusal to consider any other scenarios drastically drove up the cost of this litigation. (See In re Marriage of Drake (1997) 53 Cal.App.4th 1139, 1167 [trial court may consider parties' tactics].)

Carla relies on multiple cases to bolster her claim that the disparity in the parties' financial situations mandated that Steve pay her fees. None, in fact, compels such a result, including In re Marriage of Tharp (2010) 188 Cal.App.4th 1295 (Marriage of Tharp), on which she heavily relies. In Marriage of Tharp, the husband came from a wealthy family and was the vice president of a family corporation in which his parents owned the majority of stock. The wife, on the other hand, had not worked outside the home for the last eight years of the marriage. According to the husband, the couple had signed an antenuptial agreement confirming that all property the husband owned was his separate property and all of his income before, during, and after the marriage was his separate property. After a 15-year marriage, the husband petitioned for dissolution. (Id. at pp. 1299-1300.)

Over the course of the dissolution proceeding, the wife filed multiple requests for attorney fees, at one point seeking upwards of $310,000 for past and future fees. (Marriage of Tharp, supra, 188 Cal.App.4th at pp. 1299, 1301, 1304.) She represented that husband's monthly income was $47,000, he had significant corporate holdings, and the corporation had paid much of his $125,000 in attorney fees, while she had no source of income other than $5,000 a month in temporary spousal support and no assets other than a 401k account worth $30,000. (Id. at pp. 1304, 1306.) Early in the proceeding, the court awarded her $22,500 in attorney fees and $2,500 for an accounting evaluation; other than that, the court awarded her only $20,000 payable upon the conclusion of trial. (Id. at pp. 1301, 1306, 1308.) In denying her requests for more fees, the court labeled the requests " 'grossly excessive' " and rejected her claim that the husband had increased the fees by frustrating her efforts to obtain financial information about the corporation, finding instead that her unnecessary discovery drove up the fees. (Id. at pp. 1307-1308.)

The Court of Appeal reversed. (Marriage of Tharp, supra, 188 Cal.App.4th at p. 1299.) The basis of its reversal was not that the trial court abused its discretion by failing to award more fees (although it did note that the parties' respective financial situations were a "strong indication" that the wife was entitled to a fee award (id. at p. 1315)). Rather, it held that the trial court abused its discretion by failing to conduct an analysis of the wife's need for fees. (Id. at p. 1314.) That was not the case here, where the trial court here thoroughly analyzed the parties' relative circumstances, including Carla's needs.

Additionally, the wife's circumstances in Marriage of Tharp were vastly different than Carla's. While the trial court there found that the wife's excessive discovery drove up the fees (Marriage of Tharp, supra, 188 Cal.App.4th at p. 1308), the Court of Appeal viewed the record differently—that it was in fact the husband's "antics in thwarting discovery" that escalated the fees. (Id. at p. 1318.) Further, the wife had no income other than the $5,000 monthly support payments and few assets. (Id. at p. 1315.) Here, the trial court rightly found that Carla litigated this case very aggressively, was responsible for perpetuating this litigation, and caused the parties to incur $1.5 million in fees. And she had millions of dollars from her community property share, among other resources, from which to fund her expenses.

As Carla correctly points out, the Marriage of Tharp court concluded its analysis of the fee issue with this observation: "The public policy purpose behind sections 2030 and 2032 is ' "leveling the playing field" and permitting the lower-earning spouse to pay counsel and experts to litigate the issues in the same manner as the spouse with higher earnings.' " (Marriage of Tharp, supra, 188 Cal.App.4th at pp. 1315-1316.) But this public policy does not exist in a vacuum. It must be reconciled with the directives of section 2032 that an award of fees be "just and reasonable." That is what the trial court did here.

Carla's reliance on In re Marriage of Cryer, supra, 198 Cal.App.4th at p. 1056 is similarly misplaced. She cites the following passage: "In reviewing an attorney fee order, the record must reflect that the trial court considered the factors set forth in sections 2030 and 2032. [Citation.] The purpose of section 2030 is to ensure parity. 'The idea is that both sides should have the opportunity to retain counsel, not just (as is usually the case) only the party with greater financial strength.' [Citation.] As for section 2032, it not only requires that the court consider the financial resources of each party, but also requires a broader analysis of the parties' relative circumstances. [Citation.]" She then goes on to assert that the "trial court in this case totally ignored the concept of the parties' relative circumstances." Not so. As detailed above, the court analyzed the section 4320 factors, and concluded that the parties' circumstances—including Carla's positions that drove up the cost of litigation—warranted allocating the combined fees two-thirds to Steve and one-third to Carla.

Marriage of Dietz, supra, 176 Cal.App.4th 387 is of no greater assistance. There, years after dissolution of their marriage, the husband petitioned to reduce the support he paid the wife based on a claimed change of circumstances. The court agreed with the husband and ordered a reduction in his spousal support obligation. It also denied the wife's request for fees, finding " 'that there is no need . . . for [husband] to pay any portion of [wife's] attorney's fees. Both parties here have equal access to quality legal services. The order to show causes re termination or reduction in spousal support was appropriate. It was brought in good faith. It was earnest. There just isn't any reason here to shift the burden of the attorney's fees.' " (Id. at p. 406.) As to the fee request, the Court of Appeal reversed on the ground that the trial court applied the wrong standard: "The proper legal standard for determining whether to award attorney fees in such proceedings is not whether the proceedings were brought in good faith or in earnest, or even whether the party requesting attorney fees and costs had resources to pay attorney fees without considering other factors. [Citation.] Instead, the trial court is required to determine how to apportion the overall cost of the litigation equitably between the parties under their relative circumstances. [Citation.]" (Ibid.) That is precisely what the court did here: it properly considered the parties' relative circumstances and apportioned the overall cost of the litigation equitably given the totality of circumstances.

In short, sections 2030 and 2032 are intended to prevent one party from litigating the other party out of the case. (In re Marriage of Smith, supra, 242 Cal.App.4th 529, 534.) That is by no means what happened here. And Carla provides no authority for her belief that she was entitled to adhere to her unreasonable position regarding the support to which she was entitled, run up the fees incurred by both sides as a result of her unwavering belief, and when all was said and done then demand that Steve pay all of her fees. No, the trial court had wide latitude in determining a just and reasonable allocation of expenses under the circumstances, and it acted within its discretion in apportioning the overall cost of the litigation. The same analysis applies to the court's denial of Carla's requests for fees on appeal.

3. The Trial Court Abused Its Discretion in Denying Carla's Request for Attorney Fees for Bringing the Post-Judgment Motion

Turning to Carla's request for fees for bringing the motion for modification, we conclude there was an abuse of discretion. Section 3557, subdivision (a), provides for attorney fees incurred in enforcing a child support order. Carla prevailed on her request for Ostler-Smith child support arrearages. Similarly, section 3652 provides for attorney fees incurred in a proceeding to modify a child support order. Carla prevailed on her request to modify the child support add-ons allocation, with the court ordering Steve to pay 100 percent of the children's tuition. She also prevailed on her request to modify the spousal support award based on the changed circumstances pertaining to her Paris apartment. Having succeeded on three remedies sought in her motion, it was an abuse of discretion not to award her at least some of the fees incurred in bringing the motion.

4. The Trial Court Did Not Abuse Its Discretion in Denying Carla's Request for Modification of Spousal Support Based on Her Purchase of a Residence

In her final argument, Carla challenges the trial court's finding that her purchase of a house—and the corresponding reduction in her investible assets—did not constitute a change of circumstances warranting a modification of the spousal support order. "The trial court has broad discretion to decide whether to modify a spousal support order based on a material change of circumstances. In exercising this discretion, the court considers the same criteria set forth in section 4320 as it considered when making the initial order and any subsequent modification order." (In re Marriage of Terry (2000) 80 Cal.App.4th 921, 928; Marriage of Dietz, supra, 176 Cal.App.4th at p. 398.) "While the trial court has wide latitude in exercising its discretion to modify an award of spousal support, there must be demonstrated a material change of circumstances subsequent to the prior order. [Citation.] In the absence of such a substantial change of circumstances, the court has no authority to modify a spousal support award. [Citation.] The facts and circumstances of each case determine whether a modification is warranted, and the exercise of the trial court's discretion in ordering modification will not be disturbed on appeal unless, as a matter of law, an abuse of discretion is shown. [Citation.]" (In re Marriage of Farrell (1985) 171 Cal.App.3d 695, 700.)

As detailed above, in her request for modification of spousal support, Carla informed the court that she had purchased a house for $1,812,000 in all cash and claimed this constituted a change of circumstances warranting a modification of her spousal support because it reduced her investible assets. The trial court found this did not constitute a change in circumstances and denied her request. This was not an abuse of discretion. We incorporate our above analysis in section IB7, ante, regarding the trial court's refusal to exclude the funds for purchasing a house from Carla's investible assets when it calculated her imputed investment income, which is equally applicable here. (See also In re Marriage of Aninger, supra, 220 Cal.App.3d at p. 242 [wife's failure to become self-supporting because she purchased a condominium beyond her reasonable means did not constitute a change of circumstances justifying an increase in spousal support].)²⁸

28 Carla asserts that the trial court did not address her request for spousal support pending her appeal, but the final sentence of the SOD2 denied that request. In any case, the request was mooted by the court's extension of spousal support based on the damage to the Paris apartment. --------

DISPOSITION

The orders are reversed in part and remanded for further consideration of whether Carla is self-supporting at the marital standard of living and the amount of fees to which she is entitled for bringing her "Request for Order to Modify Spousal Support, Child Support Add-Ons, Enforce Child Support Order re Ostler-Smith Child Support True-Up, and Attorneys' Fees and Costs." In all other regards, the orders are affirmed. Each side shall bear its respective costs on appeal.

/s/_________

Richman, Acting P.J.

We concur:

/s/_________

Stewart, J.

/s/_________

Miller, J.