Marriage of Albrecht and Bassford

Filed 7/25/06 Marriage of Albrecht and Bassford CA4/1

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

APPEAL from an order of the Superior Court of San Diego County, Edward B. Huntington, Judge. Affirmed.

Jeff Albrecht appeals from an order entered February 10, 2005 (the order) granting his request for an increase in child support payable by his former wife, Susan Bassford, for the support of their two minor children and awarding him attorney fees in the amount of $10,000. Bassford is the president and 50 percent owner of Pacific Rim Capital Corporation (Pacific Rim), a closely held^[1] "Subchapter S corporation" that elected to be taxed under subchapter S of the Internal Revenue Code, pursuant to the Subdivision S Revision Act of 1982, which is codified in 26 United States Code section 1366^[2] and allows a small corporate business to elect to have all of the corporation's income, deductions, losses, and credits "pass through" to the shareholders of the corporation for income tax purposes in accordance with each shareholder's pro rata share of ownership in the corporation.^[3]

Albrecht contends (1) the court erred by excluding Bassford's $2,587,530 in 2004 undistributed subchapter S "pass-through" income^[4] from the calculation under Family Code^[5] section 4058 of her 2004 annual gross income for the purpose of calculating her child support obligation; (2) the court abused its discretion when it denied Albrecht's request for attorney fees in the amount of $31,688 and awarded him only $10,000 in fees; and (3) if this court reverses the judgment in any respect, the matter should be remanded to another judge on the ground a reasonable person would entertain doubts about the court's impartiality toward Albrecht.

For reasons we shall explain, we conclude the court did not err by excluding Bassford's undistributed subchapter S pass-through income when it calculated her gross income under section 4058. We also conclude the court did not abuse its discretion by awarding to Albrecht the sum of $10,000 in reasonable attorney fees, and thus the issue of whether this matter should be remanded to another judge is moot. Accordingly, we affirm the order.

FACTUAL BACKGROUND

Albrecht and Bassford (together the parties) divorced in 1994. They have two teenage children, and their custodial time-sharing arrangement is a "50/50 split," accomplished on a rotating two-week basis. The parties anticipated that child support for their son, who was born in May 1987, would continue until about June 2006, and such support for their daughter, who was born in June 1989, would continue until about June 2007. In their 1995 marital settlement agreement, the parties agreed that neither of them would be obligated at that time to pay child support to the other party.

Following their divorce, Albrecht experienced financial problems, while Bassford enjoyed great financial success. In late 1999 Bassford was ordered to pay child support to Albrecht in the monthly amount of $2,000. In 2002 the parties stipulated to increase the amount of child support to $3,000 per month.

PROCEDURAL BACKGROUND

A. Order To Show Cause

Asserting that the child support he was receiving from Bassford fell below the statewide uniform guideline amount provided by section 4055, Albrecht obtained an order to show cause in April 2004, seeking an increase in child support payments plus attorney fees.

B. Trial

At the February 3, 2005 contested evidentiary hearing on his child support modification request, Albrecht testified that he owned and operated one check-cashing store in Encinitas. His most recent income and expense declaration, dated January 28 of that year, indicated he was earning gross monthly income in the amount of $2,000 as the manager of his check-cashing business, he had average monthly expenses in the amount of $24,354, including rent in the amount of $7,500, and he had incurred attorney fees in the amount of about $31,688. Albrecht's trial counsel clarified that Albrecht's income and expense declaration reflected the living expenses he would incur if he had a residence comparable to Bassford's.

Albrecht's testimony indicated that the two-bedroom house he was renting had about 1,475 square feet of living space, his teenage daughter had her own bedroom, his teenage son lived in a converted part of the dining area beyond the living room, and the teens shared a bathroom. Albrecht stated he had been financially unable to take the children on any vacation trips during the past three to four years, and the children had commented to Family Court Services regarding the lack of privacy and uncomfortable sleeping conditions.

On cross-examination, Albrecht stated that he filed for personal bankruptcy in 1995, and he occasionally gambles at Indian casinos.

Bassford testified that she is the president and 50 percent shareholder of Pacific Rim, and another woman is the other 50 percent owner. Bassford receives a monthly salary of $40,000 for an annual gross salary of $480,000. Her home has 5,000 square feet of living space, the two children each have their own bedroom and bathroom, and they have a pool, jacuzzi, sport court and putting green.

Bassford stated that Pacific Rim is a subchapter S corporation, and its net profit is attributed, but not distributed, equally to Bassford and the co-owner, and the corporation pays the income taxes on the attributed income. Pacific Rim's undistributed income totaled $5,175,059 for the first 11 months of 2004, and thus Bassford's one-half share of that undistributed income was about $2,587,530. The number of stores owned by her corporation rose from 54 in 2002, to 60 in 2003, and to 77 at the time of trial. Pacific Rim's revenues have risen every year through expansion.

Bassford's testimony indicated that she has no authority to unilaterally raise her salary or take a distribution of the retained attributed income. A large loan to Pacific Rim in the amount of almost $5.5 million from California Bank and Trust has covenants that restrict the ability of Bassford and her co-owner to distribute the retained income in order to maintain a certain level of liquidity. Because Pacific Rim is a check-cashing business, it needs a great deal of liquidity. The retained earnings are used for debt service and rapid expansion of the business. Bassford stated she was willing and able to pay whatever amount of child support the court ordered her to pay, and she could pay it out of her salary and savings.

Harvey Corn, a certified public accountant, testified that his firm has had a relationship with Pacific Rim for 14 years, and it provides accounting, tax and consulting services to the corporation. Corn stated that Pacific Rim is a corporation that has made a subchapter S election under the Internal Revenue Code, and has seven subchapter S subsidiaries. As a subchapter S corporation, Pacific Rim's earnings are taxed directly to the shareholders. Bassford and her co-owner, who are equal shareholders, each own 50 percent of the business. Because 50 percent ownership is a noncontrolling interest, neither of the owners can take a distribution of the retained earnings without the consent of the other owner. He explained that "retained earnings" are the funds originally and later contributed by the shareholders, plus the earnings of the corporation, minus any losses plus funds distributed to the shareholders. Corn described the retained attributable earnings as the "fuel" that has allowed Pacific Rim to grow to its present size in a "prudent way." Pacific Rim has grown every other year for about nine years, and the years of relatively low growth are years of capital accumulation for years of better growth.

Corn testified that any significant increase in compensation paid to Pacific Rim's owners would be a challenge because of the debt covenants and the degree to which this type of business must retain cash, which Pacific Rim "eats . . . like a hungry dog." His testimony indicated that because there are financial dangers in stasis in this line of business, the retained earnings allow Pacific Rim to survive. If the owners had taken out all of their retained attributed income, they would have gone out of business years ago. Corn opined that Pacific Rim has been managed prudently in terms of how much attributed income remains with the corporation.

C. Order

On February 10, 2005, the court issued its statement of decision and entered the order thereon. The court increased the existing monthly child support award by ordering Bassford to pay as "indirect" child support up to $3,000 per month for a rental house in the North County area, plus an additional monthly sum of $2,000 payable directly to Albrecht. The court also ordered that the child support award "shall continue without reduction until the youngest child turns 18 or is otherwise emancipated." The court awarded attorney fees to Albrecht in the amount of $10,000.

In support of the order, the court found that by 1999 Albrecht, whose monthly income had leveled off to $3,000, had gone through a bankruptcy proceeding and owed significant sums to credit card companies, the Internal Revenue Service, and his parents. The court stated that "[t]he bankruptcy schedule of debts reflected four different business interests and four different automobiles, including two Porsches and a BMW, $46,000 in credit card debt, and $10,000 in debts to casinos in Nevada." The court expressed concern that the support intended for the parties' two children "might not actually be used for the benefit of the children" because of Albrecht's "unrealistic and wishful Income and Expense Declarations" and his "continued propensity to incur debt with no apparent ability to meet the obligations incurred." The court characterized as "offensive" Albrecht's argument that Bassford was building her business at the expense of the children and stated, "Something about a childhood story of The Three Little Pigs comes to mind." The court also stated that "it seems that [Albrecht] wants [Bassford] to make up for the poor business and personal decisions that he has made through the medium of child support." Noting that Albrecht is a fully licensed helicopter pilot and instructor, the court found that the parties submitted no evidence regarding the income that such employment might produce.

The court found that Pacific Rim's business plan, which its owners had followed since 1995, was to withhold the income taxes on the attributable income and "plow the excess back into the business." The court further found that this plan had allowed the business to grow from one store to about 70, and the plan was in the best interest of the children. The court decided to respect that plan, and stated that "[i]t would require substantial hubris for the [court] to insert or interject itself and require that [Bassford] withdraw planned business funds and redirect them toward the purpose of providing additional support to [Albrecht]." The court found that no competent evidence had been presented as to whether it was in the children's best interest to have their own bedroom and bathroom, take trips with Albrecht, and have a "lifestyle similar to [Bassford's] when they're with [Albrecht]." Finding that Pacific Rim must meet "significant cash retention requirements" as set forth in the business loan agreement with California Bank and Trust, the court decided not to include Bassford's share of the attributable income "for guideline purpose[s]" in the calculation of her gross income under section 4058. The court found that the monthly guideline child support was $4,140, which is below the amount of child support provided in the order. Albrecht's appeal from the order followed.

DISCUSSION

I

EXCLUSION OF BASSFORD'S UNDISTRIBUTED SUBCHAPTER S

"PASS-THROUGH" INCOME FROM THE SECTION 4058

CALCULATION OF HER GROSS INCOME

Albrecht first contends the court erred by excluding Bassford's $2,587,530 in 2004 undistributed subchapter S pass-through income^[6] from the court's calculation under section 4058 (discussed, post) of her annual gross income for the purpose of calculating her child support obligation. We reject this contention.

A. Applicable Legal Principles

"California has a strong public policy in favor of adequate child support. [Citations.] That policy is expressed in statutes embodying the statewide uniform child support guideline. [Citation.]" (In re Marriage of Cheriton (2001) 92 Cal.App.4th 269, 283 (Cheriton).) "In setting guideline support, the courts are required to adhere to certain principles, including these: 'A parent's first and principal obligation is to support his or her minor children according to the parent's circumstances and station in life.' (§ 4053, subd. (a).) 'Each parent should pay for the support of the children according to his or her ability.' (§ 4053, subd. (d).) 'Children should share in the standard of living of both parents. Child support may therefore appropriately improve the standard of living of the custodial household to improve the lives of the children.' (§ 4053, subd. (f).)" (Cheriton, supra, 92 Cal.App.4th at p. 283.) Where, as here, both parents have high levels of responsibility for the children, as a general rule child support orders "should reflect the increased costs of raising the children in two homes and should minimize significant disparities in the children's living standards in the two homes." (§ 4053, subd. (g).)

In In re Marriage of Wittgrove (2004) 120 Cal.App.4th 1317 (Wittgrove), this court stated that "[a]lthough section 4053 grants a court broad discretion in applying the principles in implementing the statewide uniform guidelines for child support, the main concern is the child's best interests. [Citations.]" (Wittgrove, supra, at p. 1326, italics added.)

With regard to child support, courts are required to adhere to the statewide uniform guideline formula set forth in section 4055 and may depart from the guideline only in specified circumstances provided by statute. (Wittgrove, supra, 120 Cal.App.4th at p. 1326, citing § 4052.) The section 4055 formula for determining the amount of child support is based on the net disposable incomes of the parents. (County of Placer v. Andrade (1997) 55 Cal.App.4th 1393, 1395 (Andrade).) The court must first calculate the annual gross income of the parent, defined in section 4058, subdivision (a) as "income from whatever source derived, except as specified in subdivision (c)."^[7] Of particular importance to the instant appeal, subdivision (a)(2) of section 4058 (hereafter section 4058(a)(2)) provides that annual gross income includes "[i]ncome from the proprietorship of a business, such as gross receipts from the business reduced by expenditures required for the operation of the business." Subdivision (c) of section 4058 expressly excludes from the calculation of annual gross income only (1) "any income derived from child support payments actually received," and (2) "income derived from any public assistance program, eligibility for which is based on a determination of need."

The parent's monthly net disposable income is derived from the calculation of annual gross income under section 4058. (Andrade, supra, 55 Cal.App.4th at p. 1396.) Section 4059 defines the term "annual net disposable income." A parent's annual net disposable income is "derived by deducting specified amounts from the 'annual gross income' (§ 4059), which is then divided by 12 to arrive at an average 'monthly net disposable income.' (§ 4060.)" (Andrade, supra, 55 Cal.App.4th at p. 1396, fn. 5.)

1. Standards of review

"We review child support awards under an abuse of discretion standard. [Citation.] 'We cannot substitute our judgment for that of the trial court, but only determine if any judge reasonably could have made such an order. [Citation.] Our review of factual findings is limited to a determination of whether there is any substantial evidence to support the trial court's conclusions. [Citation.]' [Citation.]" (Wittgrove, supra, 120 Cal.App.4th at p. 1327.) The appropriate test of abuse of discretion is whether or not the trial court exceeded the bounds of reason, all of the circumstances before it being considered. (In re Marriage of Carter (1971) 19 Cal.App.3d 479, 494.)

B. Analysis

In support of his contention that the court erred by excluding Bassford's share of Pacific Rim's undistributed subchapter S "pass-through" income from the calculation of her annual gross income under section 4058, Albrecht asserts that the definition of gross income set forth in section 4058 is "very broad," and "[t]he plain language of [section 4058] provides that income from the operation of a business is included as gross income, after deducting operating expenses." He maintains that "[t]he [L]egislature did not include any discretion to ignore any component of business income in calculating gross income," section 4058(a)(2) "should be applied as written," and subchapter S pass-through income "is clearly income within the meaning of [section 4058], a statute so broad and all-inclusive as to include workers' compensation and unemployment insurance benefits."

As already discussed, however, section 4053 grants a court broad discretion in applying pertinent guiding principles (such as those set forth in section 1053, subdivisions (a), (d) and (f), discussed, ante) in implementing the statewide uniform guidelines for child support. (Wittgrove, supra, 120 Cal.App.4th at p. 1326.) Notwithstanding that broad discretion, as this court explained in Wittgrove, the main concern is the child's best interests. (Ibid.)

Here, the order increasing the child support award was based on various factual findings, supported by substantial evidence showing that the award was in the best interests of the children. Albrecht testified that he had filed for personal bankruptcy in 1995. Although he denied he was a gambler, he also testified that he "ha[d] been in a couple of the Indian casinos once in a while," and stated, "I guess if you put money in a slot machine, it's considered gambling." The court found that the bankruptcy schedule of debts reflected four different business interests and four different automobiles, including two Porsches and a BMW, $46,000 in credit card debt, and $10,000 in debts to casinos in Nevada. The court also found that Albrecht's "debt structure" is up to more than $128,000, and Albrecht has a "continued propensity to incur debt with no apparent ability to meet the obligations incurred." On appeal, Albrecht does not contest these findings. Based on these findings, the court expressed concern that the support intended for the parties' two children "might not actually be used for the benefit of the children."

The court also found that Pacific Rim's longstanding business plan, which involved withholding the income taxes on the subchapter S attributable income and "plow[ing] the excess back into the business," had allowed the business to grow from one store to about 70 and was in the best interest of the children.

The court further found that Albrecht had failed to present competent evidence showing that it was in the children's best interest to have their own bedroom and bathroom, take trips with Albrecht, and have a lifestyle similar to Bassford's during the time they spend with him.

Albrecht does not dispute that the court's order increased the amount of monthly child support Bassford is required to pay to him. The record shows the court could have increased Bassford's child support obligation further without including her share of the undistributed subchapter S pass-through income in the calculation of her annual gross income under section 4058. Bassford testified she was willing and able to pay whatever amount of child support the court ordered her to pay, and she could pay it out of her salary and savings.

Because substantial evidence supports the court's findings and decision, we conclude the court did not abuse its discretion by excluding Bassford's share of the undistributed subchapter S pass-through income from the calculation of her gross income under section 4058. (Wittgrove, supra, 120 Cal.App.4th at p. 1327.) Even if we were to conclude that the court erred by excluding Bassford's share of Pacific Rim's undistributed subchapter S pass-through income from the calculation of her annual gross income under section 4058, for the foregoing reasons we would conclude any such error is harmless. The court substantially increased the monthly amount of child support Bassford is obligated to pay to Albrecht, and substantial evidence supports the court's finding that maintaining Pacific Rim's existing business plan is in the best interest of the children.

Bassford urges this court to adopt the recent holdings of the Florida Supreme Court in Zold, supra, 911 So.2d at pages 1231, 1233, that (1) undistributed pass-through income that has been retained by a subchapter S corporation for "corporate purposes," as opposed to "noncorporate purposes" (such as the shielding of that income from the reach of a shareholder-spouse upon dissolution of marriage), does not constitute income for purposes of calculating child support; and (2) when the issue of whether undistributed pass-through income was retained for corporate purposes is contested, the shareholder-spouse should have the burden of proving that the undistributed pass-through income was properly retained for "corporate purposes."

However, in light of our determination that the court did not err, we need not reach the question of whether this court should adopt the holdings in Zold. We note that a careful reading of the Zold opinion indicates that in reaching its decision, the Florida Supreme Court relied on a Florida statute (i.e., § 607.06401(3), Fla. Stat. (2004)) that limited a Florida subchapter S corporation's authority to make distributions of corporate net income to its shareholders. (See Zold, supra, 911 So.2d at pp. 1227-1228.)

Even if we were to follow Zold, our conclusion that the court did not err by excluding Bassford's share of the undistributed subchapter S pass-through income from the calculation of her gross income under section 4058 would remain undisturbed. Here, the court found that Pacific Rim "must meet significant cash retention requirements as set forth in the 2004 Business Loan Agreement with California Bank and Trust." Substantial evidence supports this factual finding. Bassford testified that "we have a large loan with California Bank and Trust (hereafter the Bank) and there are some covenants that we must meet on a monthly basis in order to maintain that loan." She stated that Pacific Rim will be in default if it does not maintain the level of liquidity required by the Bank as specified in the covenants. When asked whether there were "other business reasons for keeping retained earnings in the corporation as opposed to distributing them," Bassford testified, "We have to have a certain amount of money in order to fund the loans in our business, and to certainly meet the debt requirements that we have and for expansion." Thus, substantial evidence supports a finding that Pacific Rim's retention of Bassford's share of the undistributed subchapter S pass-through income serves legitimate corporate purposes within the meaning of the decision in Zold, supra, 911 So.2d 1222.

II

ATTORNEY FEES AWARD

Albrecht next contends the court abused its discretion when it denied his request for attorney fees in the amount of $31,688 and awarded him only $10,000 in fees. We reject this contention.

A. Applicable Legal Principles

Section 2030, subdivision (a) "permits the trial court to order payment of attorney fees and costs as between the parties based upon their 'ability to pay' and their 'respective incomes and needs' in order to 'ensure that each party has access to legal representation to preserve all of the party's rights.' "^[8] (In re Marriage of Rosen (2002) 105 Cal.App.4th 808, 829 (Rosen).)

"The purpose of such an award is to provide one of the parties, if necessary, with an amount adequate to properly litigate the controversy." (In re Marriage of Duncan (2001) 90 Cal.App.4th 617, 629 (Duncan).)

The trial court may award attorney fees under section 2030 "where the making of the award, and the amount of the award, are just and reasonable under relative circumstances of the respective parties." (§ 2032, subd. (a).)

"In determining what is just and reasonable under the relative circumstances, the court shall take into consideration the need for the award to enable each party, to the extent practical, to have sufficient financial resources to present the party's case adequately, taking into consideration, to the extent relevant, the circumstances of the respective parties described in Section 4320." (§ 2032, subd. (b).) The parties' circumstances described in section 4320 " 'include assets, debts and earning ability of both parties, ability to pay, duration of the marriage, and the age and health of the parties.' " (Duncan, supra, 90 Cal.App.4th at p. 630.) In assessing one party's need and the other's ability to pay, the court may consider evidence of the parties' current incomes, assets, and earning abilities. (Ibid.)

An award of attorney fees under section 2030 "is reviewed for abuse of discretion, and we therefore must affirm unless no judge reasonably could make the order. [Citation.]" (Rosen, supra, 105 Cal.App.4th at p. 829; see also Cheriton, supra, 92 Cal.App.4th at p. 283.)

B. Analysis

Albrecht complains that he requested an award of attorney fees in the amount of $31,687.65, and the court only awarded him fees in the sum of $10,000. In awarding that amount, the court found that Albrecht's request "far exceed[ed] a reasonable amount," noting that Bassford had incurred attorney fees "in the $8,000 range." The court assumed that Albrecht "had a greater burden of discovery" and determined that "fees in the range of $10,000 to $12,000 would be reasonable." Noting that "there were depositions of each of the parties," the court found that "no experts were involved in presenting the information." The court also found that Albrecht had brought a "straightforward motion for modification of [child] support, which resulted in a significant increase for [Albrecht]" and stated "it was the Court's understanding that [Bassford] had made offers to resolve the issues at or near the level set by the Court."

Disputing that this matter was a "straightforward motion," Albrecht acknowledges that the parties underwent mediation. He asserts that the proceedings in this matter also include a one-day hearing in August 2004 and a one-day trial. He also maintains that "[t]he case itself presented a non-routine legal issue" and notes that his counsel had practiced family law for 27 years.

Because Albrecht, as the moving party, carried a heavier burden with respect to discovery, he was entitled to receive a fee award that exceeded the approximate sum of $8,000 in attorney fees that Bassford incurred. However, Albrecht does not dispute the court's finding that Bassford had made offers to resolve the child support modification issue at or near the level set by the court. On the record presented, we conclude the court did not abuse its discretion by awarding to Albrecht the sum of $10,000 in reasonable attorney fees.

DISPOSITION

The order is affirmed.

NARES, J.

WE CONCUR:

McCONNELL, P. J.

AARON, J.

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^[1] The term "closely held" or "close" corporation means a corporation that has few shareholders and whose shares are not generally traded in the securities market. (In re Marriage of Hewitson (1983) 142 Cal.App.3d 874, 881, fn. 2.)

^[2] Section 1366, subdivision (a) of the Internal Revenue Code (26 U.S.C. § 1366(a)) provides: "§ 1366. Pass-thru of items to shareholders [¶] (a) Determination of shareholder's tax liability.-- [¶] (1) In general.-- In determining the tax under this chapter of a shareholder for the shareholder's taxable year in which the taxable year of the S corporation ends . . . there shall be taken into account the shareholder's pro rata share of the corporation's-- [¶] (A) items of income (including tax-exempt income), loss, deduction, or credit the separate treatment of which could affect the liability for tax of any shareholder, and [¶] (B) nonseparately computed income or loss. . . . [¶] (2) Nonseparately computed income or loss defined.--For purposes of this subchapter, the term 'nonseparately computed income or loss' means gross income minus the deductions allowed to the corporation under this chapter . . . ."

^[3] See Zold v. Zold (Fla. 2005) 911 So.2d 1222, 1227 (Zold).

^[4] " 'Pass-through' income refers to a small business corporation's income, deductions, losses, and credits that pass through to the shareholders of the corporation in accordance with each shareholder's pro rata share of ownership in the corporation, and is reported on each shareholder's individual federal income tax return under the Subchapter S Revision Act of 1982." (Zold, supra, 911 So.2d at p. 1225, fn. 2, citing 26 U.S.C.A. § 1366 (West Supp. 2005).

^[5] All further statutory references are to the Family Code unless otherwise specified.

^[6] See footnote 4, ante.

^[7] Section 4058 provides in full: "(a) The annual gross income of each parent means income from whatever source derived, except as specified in subdivision (c) and includes, but is not limited to, the following: [¶] (1) Income such as commissions, salaries, royalties, wages, bonuses, rents, dividends, pensions, interest, trust income, annuities, workers' compensation benefits, unemployment insurance benefits, disability insurance benefits, social security benefits, and spousal support actually received from a person not a party to the proceeding to establish a child support order under this article. [¶] (2) Income from the proprietorship of a business, such as gross receipts from the business reduced by expenditures required for the operation of the business. [¶] (3) In the discretion of the court, employee benefits or self-employment benefits, taking into consideration the benefit to the employee, any corresponding reduction in living expenses, and other relevant facts. [¶] (b) The court may, in its discretion, consider the earning capacity of a parent in lieu of the parent's income, consistent with the best interests of the children. [¶] (c) Annual gross income does not include any income derived from child support payments actually received, and income derived from any public assistance program, eligibility for which is based on a determination of need. Child support received by a party for children from another relationship shall not be included as part of that party's gross or net income." (Italics added.)

^[8] Section 2030, subdivision (a) provides: "(a)(1) In a proceeding for dissolution of marriage, nullity of marriage, or legal separation of the parties, and in any proceeding subsequent to entry of a related judgment, the court shall ensure that each party has access to legal representation to preserve each party's rights by ordering, if necessary based on the income and needs assessments, one party, except a governmental entity, to pay to the other party, or to the other party's attorney, whatever amount is reasonably necessary for attorney's fees and for the cost of maintaining or defending the proceeding during the pendency of the proceeding. [¶] (2) Whether one party shall be ordered to pay attorney's fees and costs for another party, and what amount shall be paid, shall be determined based upon, (A) the respective incomes and needs of the parties, and (B) any factors affecting the parties' respective abilities to pay. A party who lacks the financial ability to hire an attorney may request, as an in pro per litigant, that the court order the other party, if that other party has the financial ability, to pay a reasonable amount to allow the unrepresented party to retain an attorney in a timely manner before proceedings in the matter go forward."