Filed 5/11/06 Marriage of Wolfgang CA5
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 977.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT
In re Marriage of ROBERT and KIMBERLY WOLFGANG. | |
JEAN WOLFGANG, Respondent, v. KIMBERLY COOK, Appellant. | F046951 (Super. Ct. No. CV37525) OPINION |
APPEAL from a judgment of the Superior Court of Tuolumne County. Charles V. Stone, Judge.
Law Offices of Gary P. Dambacher, Gary P. Dambacher and Sue Griffith for Appellant.
Law Office of Cherie A. Spitze and Cherie A. Spitze for Respondent.
-ooOoo-
INTRODUCTION
The instant case presents a situation where a noncustodial parent suddenly died leaving outstanding obligations for child support and arrearages. Appellant former wife had numerous opportunities, before and after his death, to enforce the child support obligations against his assets but failed to timely and correctly do so. The trial court found that her post-death attempt to enforce the child support obligations was barred by the statute of limitations, and that his assets automatically passed to his surviving wife at the time of his death because such assets were held in joint tenancy. Despite the hyperbole and rhetoric in her motions and briefs, the appellant former wife's arguments are rebutted by the appellate record, and we will find the trial court's ruling was correct and guided by well-established law.
Robert Wolfgang (Robert) and Kimberly Cook Wolfgang (Kimberly)[1] were married and had two children. They separated and obtained a dissolution of their marriage. Kimberly had physical custody of the children and Robert was ordered to pay child support. Robert failed to pay such support and Kimberly obtained wage garnishments against him. Robert remarried and had another child. Robert and his new wife, Jean, purchased two parcels of real property in joint tenancy: their residence and subsequently an adjacent undeveloped parcel used to connect their house to the public water line. A few years later, Robert died suddenly, leaving substantial child support arrearages, as well as ongoing support obligations. At death Robert's primary assets were the two properties held in joint tenancy with Jean.
The instant case is based on a motion Kimberly filed in the ongoing dissolution case in family court, more than one year after Robert died, to enforce Robert's child support obligations by causing a lien to be placed on his joint tenancy interest in the undeveloped parcel. Kimberly argued such a lien was appropriate and necessary to obtain satisfaction for the child support arrearages and future child support payments for her two children. Jean made special appearances and contested the family court's jurisdiction over her because she was not a party to the underlying family court action. Jean also argued Kimberly's motion was foreclosed by Code of Civil Procedure[2] section 366.2, which requires a creditor to file an action to enforce a debt against a deceased debtor's property within one year of the debtor's death. Jean further argued the entire joint tenancy property automatically belonged to her upon Robert's death, and the property was not within Robert's estate for placement of a lien.
The family court requested and received extensive briefing from the parties, and found Kimberly never properly joined Jean in the family court action, Kimberly's motion was barred by the statute of limitations, Robert's joint tenancy interest in the subject property automatically passed to Jean upon his death, and that property was not available for placement of a lien for the child support arrearages.
On appeal, Kimberly asserts her motion to place a lien on Robert's joint tenancy interest was not barred by the statute of limitations, the statute was tolled since she brought the motion on behalf of her minor children for child support arrearages, Jean was barred by the doctrine of equitable estoppel from raising the statute of limitations as a defense, a joint tenancy asset is part of a decedent's estate for purposes of child support orders, and Robert and Jean placed their assets in joint tenancy to avoid enforcement of the child support order. We will affirm the family court's ruling in favor of Jean.
FACTS
We rely on the parties' extensive pleadings and declarations for the factual background in this case.
The Dissolution and Child Support Order
On June 22, 1985, Robert and Kimberly were married. They had two children: R., born in 1987, and T., born in 1989.
On June 1, 1993, Robert and Kimberly separated. Robert and Kimberly were represented by counsel throughout all proceedings in this case.
On June 10, 1993, Robert and Kimberly entered into a " Marital Termination Agreement" (Marital Termination Agreement), by which they agreed to a complete and final settlement of all rights and obligations between them in lieu of an action for dissolution of the marriage. Robert and Kimberly agreed to joint legal custody of the children, Kimberly had sole physical custody, and Robert had reasonable visitation rights. Robert agreed to pay monthly child support of $425 per month, and each party waived spousal support. Robert agreed to pay child support until such time as each child died, turned 19 years old, turned 18 years old and was no longer a full-time high school student, or entered into a valid marriage, entered the armed services, or became emancipated. The agreement also divided their community assets.
This agreement apparently was not satisfactory to Kimberly, because when Robert subsequently filed a petition for dissolution of marriage, Kimberly sought to set aside the agreement. A contested hearing was held on March 22, 1995.
On May 19, 1995, the Superior Court of Tuolumne County (case No. CV37525) ordered the entry of the judgment of dissolution of the marriage, and denied Kimberly's motion to set aside the Marital Termination Agreement. The custody and visitation aspects of the agreement remained in effect. The court ordered Robert to pay total monthly child support of $1,000, from April 1, 1995 to June 30, 1996, until further order of the court. The court also awarded Kimberly 30 percent of " 'the gross amount of any bonus [Robert] received after July 1, 1993, forthwith upon receipt of his payroll check.'"
On August 6, 1997, the court filed a stipulation and order for Robert to pay monthly child support of $1,091 and child care costs of $100, for a total of $1,191 as of July 1, 1996 pursuant to a Dissomaster calculation.
Robert's Remarriage and Purchase of Real Property
At some point between 1995 and 1996, Robert married Jean. Thereafter, on June 12, 1996, Robert and Jean purchased a residence on Harmony Lane in Sonora. According to the deed, they acquired the property at the time of the purchase as " husband and wife as Joint Tenants."
Four years later on October 6, 2000, Robert and Jean purchased an unimproved parcel on Elizabeth Lane in Sonora, immediately adjacent to their Harmony Lane residence, which is the subject of the instant case. The deed again states they acquired the property at the time of purchase as " husband and wife, as Joint Tenants." As we will discuss, post, Jean declared they purchased this undeveloped parcel so that they could connect their residence to the public water line. Jean declared that after living at Harmony Lane for several years, they experienced problems with their well and they were unable to drill another well on their property which provided potable water. Their residential property did not have access to a public water source, but an adjacent property had such access. The owners of the adjacent property were aware of their problem and agreed to sell the lot to them. Robert and Jean purchased that property, and used it to connect their residence to the public water line. This property remained undeveloped.
Kimberly's Liens
The record herein reflects that Robert did not pay the child support obligations as ordered by the court. As a result, on June 16, 2000, Kimberly obtained an order to garnish Robert's wages at $1,191 per month for child support, and reserved a request for garnishment for child support arrearages.
On or about October 17, 2000, Kimberly requested issuance of a writ of execution for $8,312, consistent with the court's previous order for Robert to pay her a percentage of the gross amount of overtime bonus checks he received from his employer.
On October 17, 2000, the court issued and recorded a writ of execution, on behalf of Kimberly as judgment creditor and against Robert as judgment debtor, for $8,319. On November 9, 2000, Kimberly, as judgment creditor, obtained an abstract of judgment against Robert, as judgment debtor, for $8,319. On November 16, 2000, Kimberly recorded the abstract of judgment lien which affected Robert's property.
On November 22, 2000, Kimberly filed a declaration that Robert's child support arrearages from January 1996 to August 2000 were $9,415.32, plus interest of $1,530.72, for a total of $10,946.04. Kimberly requested a revised wage and earnings order for that amount, and for the court to order payment of the arrears at $250 per month.
On November 28, 2000, the sheriff's department attempted to serve the October 17, 2000 writ of execution on Robert's accounts at Wells Fargo Bank. On December 13, 2000, the sheriff's department returned the writ of execution as unsatisfied.
Kimberly's Release of the Residential Property Lien
As of November 2000 through December 2001, Kimberly received child support solely through wage garnishments. In November 2000, as set forth ante, Kimberly recorded an abstract of judgment affecting the Harmony Lane residence, held by Robert and Jean as joint tenants.
On May 16, 2001, Kimberly signed an agreement to subordinate her abstract of judgment lien to a mortgage company, in order for Robert and Jean to refinance the house. The agreement was a preprinted form which appears to have been prepared by the title company, with language typed in reflecting that Kimberly, as creditor, had recorded an abstract of judgment on the property in November 2000, and she agreed to subordinate that lien in favor of the lender as a condition precedent of the lender extending a loan to the property owners, Robert and Jean. The preprinted language further states:
" WHEREAS, it is to the mutual benefit of the parties hereto that Lender make such loan to Owner, and Creditor is willing that the deed of trust securing the same shall, when recorded, constitute a lien or charge upon said land which is unconditionally prior and superior to the lien or charge of the abstract of judgment first above mentioned." (Italics added.)
The residence was being refinanced for $174,000, and the agreement states the loan could be used for purposes other than improvement of the land. The agreement further states the parties agreed that it would constitute " the whole and only agreement with regard to the subordination of the lien ... and shall supercede and cancel, but only insofar as would affect the priority between the deeds of trust hereinbefore specifically described, any prior agreement as to such subordination ...."
The preprinted form also states that the creditor (Kimberly) unconditionally waived, relinquished, and subordinated her lien in favor of the lender, the creditor agreed the lender would make disbursements pursuant to the loan agreement, and the lender was under no obligation or duty to apply the proceedings in any way other than as described in the loan agreement.
According to Kimberly, she " agreed to release" the lien in June 2001.
There were no additional terms in the subordination agreement addressing any specific issues between Kimberly, Robert, and Jean, and no evidence of any separate agreement between the parties as to the reason Kimberly agreed to subordinate her lien on the Harmony Lane residence. In the course of the instant litigation, however, Kimberly declared that she agreed to subordinate and release her lien against the Harmony Lane property " in reliance upon a promise from [Robert] that he would be refinancing his residence and would then pay the past due child support in full." Kimberly declared that Robert and Jean's promises of future payments were " fraudulent as no funds were ever paid" to her after she caused the judgment to be released.[3]
Robert's Death
In approximately 2001, Robert and Jean had a child, C.
On January 7, 2002, Robert died " totally unexpectedly at a very early age." Kimberly was notified of Robert's death that same day.[4] According to Jean, Robert " had not contemplated an early death." The record infers that Robert was employed by the " sheriff's department" when he died. Robert's survivors were his wife, Jean, and their child, C., who was " barely one year old" at the time of his death; his two children with Kimberly, R. and T., who were now teenagers; and an adult son.[5]
Robert died intestate. Robert's assets were held in joint tenancy with Jean, including their Harmony Lane residence and the adjacent undeveloped parcel on Elizabeth Lane, which they used to connect their house to the public water line. There were no probate proceedings opened for Robert's estate. Shortly after Robert's death, Jean recorded an affidavit of death of joint tenancy as to all assets, including the two real properties, and the ownership interests reverted to her.
Kimberly had been represented by John McKinley of Brown, Hall, Shore & McKinley in Stockton, throughout the ongoing dissolution action in family court. In April 2002, Kimberly associated another attorney, Gary Dambacher of Sonora, to represent her in the family court matter along with Mr. McKinley.
Kimberly's Motion
The instant case is based on a motion Kimberly filed on January 22, 2003, in the ongoing dissolution and child support action (case No. CV37525). Kimberly moved for the family court to impose a lien upon Robert's joint tenancy interest in the undeveloped parcel adjacent to his residence, to prevent Robert's joint tenancy interest from passing to Jean, and for an order issuing a writ of execution against such property to satisfy the child support order and arrearages.[6] Kimberly declared that all child support ceased to be paid upon Robert's death, and that as of January 2003, Robert's child support arrearages were $33,797.89, including interest.
In her motion, Kimberly argued that child support obligations survive the death of the obligor spouse, the family law proceeding was the proper forum for the motion, and the court should order Robert's child support obligations to continue and be enforced against his joint tenancy assets which passed to Jean. Kimberly argued that Robert's child support obligations could be enforced against his joint tenancy interests without the benefit of probate, pursuant to In re Marriage of Perry (1997) 58 Cal.App.4th 1104 (Perry).[7]
Kimberly declared she previously recorded an abstract of judgment resulting in a lien on Robert's and Jean's Harmony Lane residence, and that she voluntarily released the lien and signed the subordination agreement. Kimberly declared that she did so because Robert and Jean promised they would refinance their residential property and use the loan proceeds to pay off Robert's child support obligations. Kimberly alleged that " [t]heir promises of future payment to KIMBERLY were fraudulent as no funds were ever paid to KIMBERLY after she caused the judgment to be released." Kimberly further alleged:
" This Court should recognize that this debt is still owed to KIMBERLY by [ROBERT] and reinstate this prior lien as well as issue an additional lien for the balance of [ROBERT'S] debt to his minor children, [R. and T.].... [¶]…[¶] Here, [ROBERT] has made absolutely no arrangements for the payment of child support to his surviving children. On the contrary, he defrauded KIMBERLY into removing her child support lien from the real property which JEAN now owns and enjoys."
Kimberly asserted that Robert's failure to provide for the children, and " his fraudulent promise" to her, could only be rectified by the court's order to impress a lien on Robert's joint tenancy interest in the undeveloped parcel adjacent to their residence, and that this property was not covered by the homestead exemption.
On January 31, 2003, Jean was personally served with Kimberly's motion to impress a lien on Robert's joint tenancy interest.
Jean's Opposition and the Attempted Joinder
On February 19, 2003, Jean made a " special appearance" in case No. CV37525 and filed a responsive declaration to contest the family court's exercise of personal jurisdiction over her. Jean argued the family court lacked jurisdiction over her because she was never a party to the underlying family law action between Robert and Kimberly, and had not been joined. Jean declared she was not properly before the court and it had no legal authority to make orders in the case.
On February 27, 2003, the court conducted a hearing in case No. CV37525, and ordered Kimberly to formally join Jean in the family court action. On the same day, Kimberly filed a notice of motion, declaration, and summons for joinder of Jean in case No. CV37525. On March 2, 2003, Jean was served with the notice of motion, declaration, and summons for joinder, but Kimberly failed to serve Jean with a copy of the underlying motion for a placement of a lien on Robert's joint tenancy interest in the undeveloped parcel.
On April 3, 2003, Jean made another special appearance to file a responsive declaration and opposition to Kimberly's motion for joinder. Jean noted that while Kimberly served her with the motion and summons for joinder, she failed to serve Jean with a copy of the underlying motion for the lien, as required by California Rules of Court, rule 1253(a), so that she was never joined in this action and was not properly before the court. Jean further argued Kimberly's claim against Robert's estate was barred by the one year statute of limitations for enforcements of debts against a deceased debtor's assets, as set forth in section 366.2.
Jean filed a declaration in support of her opposition, about Robert's child support obligations and Kimberly's subordination of her lien:
" At the time of [ROBERT's] death I had no knowledge that he was in arrears in his child support payments. It was my understanding that KIMBERLY had previously levied [ROBERT's] bank accounts which had satisfied all child support obligations. This was evidenced by the fact that in June 2001 KIMBERLY released the Abstract of Judgment which she held against [ROBERT's] real property, the property which is the subject of the instant dispute."
Jean also declared that she did not speak with Kimberly:
" … When [ROBERT] and I first got together after he separated from KIMBERLY she threatened my person and a restraining order was granted precluding her from contacting me. Due to these problems even after the restraining order expired I had no personal contact with KIMBERLY because I did not feel comfortable doing so."
Jean declared that she was informed and believed that Kimberly was told of Robert's death on the day that he died. However, Jean did not know anything about Robert's child support obligations:
" The first notice that I had that there was an issue regarding alleged child support arrears and continued support was when I was served with [KIMBERLY's] Motion to Impress a Lein [sic] on the property that passed to me incident to [ROBERT's] death. I received this in the mail on or about January 26, 2003."
Jean further declared that she was never properly joined as a party to the instant case, and that while Kimberly subsequently served her with a summons and motion for joinder, Kimberly failed to serve her with a copy of the original motion.
On April 11, 2003, Kimberly filed a response to Jean's opposition, and declared that on January 31, 2003, Jean was personally served with Kimberly's motion for a lien on Robert's joint tenancy interest, and such service occurred at the time that Kimberly originally filed that motion. Kimberly argued that any statute of limitations was tolled because she brought her motion on behalf of her minor children, since section 352 tolled the accrual of a minor's cause of action. Kimberly argued that Robert's child support obligations were continuing and unmatured, and the family court retained jurisdiction over the ongoing issue of child support obligations. " In the instant case, the children are requesting enforcement of their father's child support obligation against the obligor parent's assets that have passed by operation of law to a third party, Jean, in Family Law Court."
" It should be emphasized that we apply common sense to litigation. Does it make any sense to bar a child from enforcing his or her right to child support while he or she is a minor? Does it make any sense to require [KIMBERLY] to re-serve the Joinder Motion when Jean was already served with the exact motion and hired counsel to oppose it? We think not."
Supplemental Briefing
On April 15, 2003, Jean again made a " special appearance" and objected to the court's jurisdiction over her, and filed supplemental points and authorities in response to Kimberly's allegations. Jean argued that Kimberly was bound by section 366.2, which placed a one-year statute of limitations on the filing of claims against an estate, in order to provide closure, certainty, and protect a decedent's estate from stale claims of a creditor. While Kimberly argued that section 352 tolled the statute of limitations because she brought the motion on behalf of the minor children, Jean noted that section 352 was limited to certain actions, and did not apply to a motion to recover child support. Moreover, the minor children did not have standing to enforce the child support order, and Family Code section 4000 vested the nonobligor parent or the children's guardian ad litem with standing to enforce the order.
Jean separately argued that Kimberly's motion to impress a lien on Robert's joint tenancy interest was meritless. Jean argued there was no evidence Robert placed his real property assets in joint tenancy solely to evade his child support obligations. Jean further argued that Robert's estate did not have sufficient assets to support their two-year-old daughter, " let alone the children from his prior marriage. JEAN's daughter should not have to suffer economically in order to enrich KIMBERLY's children."
Finally Jean argued that both the Harmony Lane residence and the adjacent unimproved parcel were subject to the homestead exemption. Jean explained the adjacent lot was the sole source of water for the residence, and without " this source of public water the residence would not be habitable."
On April 25, 2003, Kimberly filed responsive points and authorities, and declared child support obligations were given " regal treatment" in California, and were " basically enforceable forever." Her minor children were the real parties in interest, and the law was " clear that any and all statutes of limitations, are tolled as to a child support obligation." In addition, a child support hearing was a pending proceeding, and Kimberly's motion was brought to enforce the existing child support order.
Kimberly relied on Perry and argued that the court could order payment of child support from Robert's joint tenancy interests. Kimberly argued that Robert " placed his property into joint tenancy so as to avoid probate and the claims of his children," and, as in Perry, the court could order a lien against Robert's joint tenancy interest to prevent his estate from avoiding his child support obligations.
In her supporting declaration, Kimberly averred that Robert " told me on many occasions that he would always 'take care of' [their children]." Kimberly further declared that during the negotiations " of our divorce agreement, [Robert] had agreed that his child support obligation would continue if something should happen to him." Kimberly argued Robert's actions " do not support this." Kimberly asserted she released the lien on the Harmony Lane residence because Robert promised to pay the child support obligations from the refinance proceeds, but Robert defrauded her when he made that promise and failed to pay her. " Now, posthumously, he attempts to keep his asserts out of reach of his children by transferring them to Jean."
" It appears that [ROBERT] in the instant case, purposefully attempted to evade his child support obligation to his children ... by manipulation of his estate assets similar to the father in Perry. Yet this court, just as the court did in Perry, can and should order that [ROBERT's] property is subject to the claims of his children for their support. Thus [ROBERT] cannot avoid his child support obligation."
Kimberly also disputed Jean's claim that the homestead exemption applied to both the Harmony Lane residence and the adjacent unimproved property, and challenged Jean's claim that the adjacent property was necessary to perfect their water rights since that property was purchased four years after the residence. Kimberly also argued the homestead exemption only applied to real property upon which the dwelling house was situated.
Kimberly further declared that Jean had received $400,000 after Robert's death, from two separate life insurance policies, his retirement, and accumulated sick leave and personal time " from the sheriff's department." Kimberly further declared that Jean quit her job, bought a new Jeep, and took a trip to Hawaii after Robert's death, that Jean owned two other vehicles, and she received over $80,000 from a worker's compensation award.
On May 1, 2003, Jean made another " special appearance" to contest the court's jurisdiction, and filed a second declaration to respond to Kimberly's allegations. Jean declared that their two properties were held in joint tenancy as " purely a result of the title company suggesting that this was the proper form of title when married persons acquire property. [Robert] was not trying to frustrate [Kimberly's] entitlement to child support."
Jean also explained that she took a one-year leave of absence from her job to take care of her young daughter, after the shock of Robert's sudden death. She went to Hawaii 10 months after his death, bought an airline ticket for $400, and stayed with a relative so there were no additional costs. Also after Robert's death, Jean sold one car and used her tax refund to make a downpayment on another car. Jean declared Kimberly's allegations that she received thousands of dollars from various life insurance policies, death benefits, retirement, or sick leave were " TOTALLY FALSE." Jean received $32,000 from a secondary life insurance policy, and Kimberly had already received one-half the face value of Robert's policy at the time of the divorce. Jean also received about $22,000 from his sick leave.
" [KIMBERLY] is again trying to lead the Court to believe that I am somehow in better financial circumstances than she is. What [she] failed to state is that she has three vehicles; a fairly new Isuzu Trooper, a sports car, a Ford Bronco, and I also believe that she owns a motorcycle. I am informed that [she] is presently putting on an addition to her home."
Jean declared that both households received $980 a month in worker's compensation benefits, and Jean " personally worked" with the worker's compensation representative to help Kimberly's children receive such benefits.
Jean also offered the complete explanation about the reason they purchased the undeveloped parcel adjacent to their residence, which was the subject of Kimberly's motion for a lien. As noted ante, Jean declared the well on their residential property went dry, they were unable to drill another well providing potable water or connect to the public water supply from their residence, and they bought the adjacent undeveloped parcel for the sole reason of connecting their residence to the public water line through that parcel. " The lot which [Kimberly] wants sold is the sole source of water for my residence ... and should be exempt from execution." " If the Court orders a forced sale of the lot which provides the water for my residence this will leave [my daughter] and I essentially homeless. I beseech the Court--do not do this to my child."
The Court's Hearing
On May 5, 2003, the court conducted a hearing on Kimberly's motion, and stated that it had reviewed all the filed documents in the case. Kimberly clarified there were no pending probate proceedings, and an affidavit of death of the joint tenant had been recorded and severed the joint tenancy interests so that the undeveloped property was in Jean's name alone. Kimberly argued that Robert's joint tenancy interest in that property still constituted part of his estate, pursuant to the Perry case, and the court could impose the lien against that interest to enforce Robert's child support obligations. Kimberly also cited to a series of Medicaid collection cases, which broadly interpreted a decedent's " estate" to include joint tenancy interests. Kimberly claimed the undeveloped parcel was not exempt from execution because it was not the residence and no one lived on that parcel. Kimberly argued that Jean could retain an easement through that property to maintain her connection to the public water line. Kimberly argued that placing the lien on the undeveloped property would result in enforcing Robert's child support obligations on an asset that would not impact Jean's life.
Kimberly asserted her motion was not barred by a one-year limitations period, because she was trying to enforce the child support obligations on behalf of her children and their minority tolled any limitations period. Kimberly further argued the statute of limitations was tolled by the doctrine of equitable estoppel because Robert " didn't play fair during his lifetime with his children. And what he did is, he promised [Kimberly] that if she lifted that child support lien, he would pay her so that they could obtain refinancing on the residence. She lifted the lien, they obtained the refinancing and then laughed all the way to the bank after that, because he didn't pay her back, and here we are today."
Jean argued that Probate Code section 13554 specifically stated that enforcement of a liability against an estate was governed by the one-year limitations period set forth in section 366.2. While a parent's child support obligation was enforceable after death, Kimberly still had to comply with the one-year limitations period to seek enforcement against a decedent's assets, and this period was not tolled by the children's minority. Kimberly knew about Robert's death, she knew about his outstanding support obligations, and she should have filed the motion within one year of his death.
Jean asked to address Kimberly's allegations about other benefits she allegedly received after Robert's death. The court replied that it was not concerned with these unrelated allegations.
The court asked the parties about Grothe v. Cortlandt Corp. (1992) 11 Cal.App.4th 1313 (Grothe), which suggested that once the deceased joint tenant's interest passed to the surviving joint tenant, there was no interest upon which a lien could be placed. Kimberly again argued that Perry and the Medi-Cal cases permitted the court to place a lien on the joint tenancy interest, and if the Medi-Cal cases " go after a joint tenancy, so can a child support [motion]." Jean replied that Perry only addressed situations when an obligor-spouse purposefully placed his assets beyond the reach of an existing child support obligation.
The court stated the contested issues were whether Kimberly's motion was barred by the statute of limitations, and whether there were assets in Robert's " estate" that could be levied upon. The court was concerned with Kimberly's argument that Robert's estate was " forever subject to a lien for child support," without regards to any limitations period. Kimberly asserted the ongoing child support proceeding was equitable, there was no statute of limitations for child support, and the court could make the appropriate and equitable order to enforce Robert's outstanding child support obligations.
The court stated the " crux" of the matter was whether a creditor could place a lien upon the property of a surviving joint tenant. The court ordered the parties to submit further briefing on the following issues: (1) whether the property of an obligor-decedent, which passed to a surviving joint tenant, constituted an " estate" subject to the children's claims for support; (2) whether enforcement of the child support obligation was exempt from the statute of limitations; and (3) whether Robert and Jean's unimproved parcel was within the homestead exemption.
Further Briefing
On May 19 and 20, 2003, Jean filed supplemental points and authorities, and again made a special appearance and contested the family court's jurisdiction over her. As to the merits, Jean argued the distinctive feature of joint tenancy was the right of survivorship, and Jean took the entire interest upon Robert's death. Jean relied on Grothe and Zeigler v. Bonnell (1942) 52 Cal.App.2d 217 (Zeigler), and argued that when a joint tenant dies, his interest dies with him, any encumbrances placed upon the property were unenforceable against the surviving joint tenant, and there was no interest or property right against which a judgment lien would be operative.[8]
" … JEAN, unaware of [Robert's] purported support arrears, filed the affidavit of death of a joint tenant shortly after [Robert's] death and took clear title to the property. Thus [Robert's] interest in the real property was extinguished and there is no property right which [Kimberly] can levy."
Jean again argued that Kimberly's motion was barred by the one-year limitations period in section 366.2, and the period was not tolled by her children's minority. Jean further argued that Kimberly was represented by counsel at all times, there was no reason for her failure to file any such claim earlier, and there was no evidence that Jean or anyone else influenced Kimberly to delay filing her motion. Jean also challenged Kimberly's hearsay assertions that Robert influenced her to release her lien on the residential property by promising to pay the child support obligations through the refinance proceeds. Jean asserted that Kimberly was represented by counsel when she released the lien, and there was " no record of a formal stipulation stating this was a condition precedent to payment of child support arrears." Jean argued that even if Robert made such a promise, and several months passed without any payments, " an ordinary person would have either inquired about the progress of the payment or would have reinstated the lien on the real property. They would not have waited for over 1 ½ years to act!"
Jean submitted another declaration and again noted that Kimberly was trying to place a lien on the undeveloped parcel adjacent to her residence, that Jean's continued ownership of the subject property was necessary to continue water service to the residence, and rejected the suggestion of Kimberly's attorney that the undeveloped parcel could be sold while retaining an easement for her water rights. Jean again challenged Kimberly's allegations about her living conditions, and complained that Kimberly was remodeling her house: " I am concerned that if she is awarded back support that these funds would not go directly to [R. and T.'s] benefit."
On May 20, 2003, Kimberly filed further points and authorities, and argued the term " estate" was broadly defined to include joint tenancy interests, based on Perry and Belshe v. Hope (1995) 33 Cal.App.4th 161 (Belshe). Kimberly acknowledged that Grothe and Zeigler seemed to support Jean's position, that child support obligations could not be enforced against a decedent's joint tenancy interest, but argued these cases were effectively overruled Perry, Belshe, and Bucholtz v. Belshe (9th Cir. 1997) 114 F.3d 923 (Bucholtz), which included joint tenancy interests in their broad definition of an " estate."
Kimberly restated her arguments that the one-year statute of limitations did not apply to this motion, child support obligations were given precedence in California, and the limitations period was tolled by her children's minority.
Kimberly also challenged Jean's attempt to extend the homestead exemption to the undeveloped parcel adjacent to her residence. Kimberly noted she " deliberately selected the unimproved lot to be levied upon because it is exempt from execution." The unimproved lot did not have any type of residence to trigger the exemption. Even if the exemption applied, " the Court has the authority and obligation to weigh the needs of the affected parties, here [R. and T.], against those of Jean, in situations where an exemption applies .…"
" The rule cannot be in California that, if you make a will your property will be subject to an existing child support order but if you put everything into joint tenancy, your property will be immune. That would be, to paraphrase a famous aphorism ..., the estate planning equivalent of a free lunch.
" [Robert's] property, now held in Jean's name, is only a 'technical difference,' and is subject to the claims of [his] children for their support.... [R. and T.] deserve to be supported by their father following his death, for child support is the superior and pristine obligation recognized by the state and nation. The Court should not side with the windfall beneficiary. Instead, it should order the writ to issue."
Responsive Briefs
On May 23, 2003, the court acknowledged receipt of the parties' supplemental briefs, and ordered the parties to file responsive briefs.
On June 9, 2003, Kimberly filed her final responsive pleadings, and argued that Jean relied on " 'old law'" to support her assertion that Robert's joint tenancy interest passed to her and was not subject to an estate lien. Kimberly asserted that in 1993, Congress enacted 42 United States Code section 1396p, which broadly defined an " estate" to include a joint tenancy interest for the purpose of enforcing a decedent's debts, as explained by Perry, Bucholtz, and Bonta v. Burke (2002) 98 Cal.App.4th 788 (Bonta).[9]
Kimberly conceded that her pending motion did not request a lien on Robert's life insurance and other job-related income, but only sought a lien on the unimproved parcel adjacent to the Harmony Lane residence.
Kimberly argued any limitations period was tolled by the doctrine of equitable estoppel, pursuant to Battuello v. Battuello (1998) 64 Cal.App.4th 842 (Battuello), because Robert made a direct promise to support R. and T. until they reached majority. Robert failed to make any payments and the court imposed a lien against his residence.
" … At [ROBERT] and JEAN'S special request and insistence, this lien was released because of [ROBERT's] promise that he would pay the support obligation later, and so that [ROBERT] and JEAN could obtain refinancing for this real property. Instead, shortly thereafter, [ROBERT] and JEAN purchased the unimproved lot that is the subject of this lawsuit." [10]
Kimberly asserted that Jean " actively participated" in her release of the lien because Jean signed the lender's subordination agreement. Kimberly also cited to language in the release, that Kimberly, Robert, and Jean signed it for their " mutual benefit," and asserted such language strongly supported her assertion that she released the lien based on Robert and Jean's promise to pay the child support obligation from the refinance of their house.
Kimberly further challenged Jean's repeated assertions that she depended upon the undeveloped parcel for the residence's only access to the public water line. Kimberly attached a declaration from the president of the local water company, that negotiations were being held to expand the regional service area to include Jean's residence.
On June 9, 2003, Jean made another " special appearance," objected to the court's jurisdiction over her, and filed her third supplemental points and authorities. Jean revisited her arguments about the application of section 366.2, that Kimberly's action was barred by the statute of limitations, with citation to additional authorities supporting her position. Jean further argued that Kimberly improperly relied upon federal statutes and case law for her argument that an " estate" was broadly defined to include joint tenancy interests. Jean noted these federal authorities specifically addressed reimbursement of Medi-Cal funds, and were not applicable to state probate and child support issues. Instead, Grothe and Zeigler clearly held that a joint tenancy interest automatically passed to the surviving spouse and a lien could not be attached to the decedent spouse's interests. Jean also restated her argument that the homestead exemption applied to the undeveloped parcel adjacent to her residence, based on the water issue.
Jean concluded by asking the court to balance the competing equities in her favor because Robert had an obligation to support all his children, including his young daughter with Jean, Robert failed to provide for any of his children in the event of a sudden passing, all the children received identical survivor's benefits, Jean's child was much younger than Kimberly's two children and Jean would have a greater financial obligation, Kimberly was remodeling her residence, and Jean's residence depended upon the adjacent parcel for its only source of water.
" The Court cannot forsake [C.'s] future for the present benefit of [R. and T.]. The facts of this case justify an equitable ruling that the support obligation should not be enforced in its entirety."
The Court's Ruling
On August 20, 2003, the court filed a memorandum of intended decision to deny Kimberly's motion because Robert's estate passed to Jean, his surviving spouse, " by way of joint tenancy and there is no property against which a judgment lien can be attached." The court also found Kimberly's action was barred by section 366.2, because it was filed over one year after Robert's death. The court ordered Jean's attorney to prepare a statement of decision, if one is requested.
On August 29, 2003, Kimberly filed a request for a statement of decision. On October 6, 2003, the court filed a statement of decision, prepared by Jean's attorney, which simply restated the intended decision.
On October 15, 2004, the court filed an amended statement of decision which extensively addressed the issues herein. The court found Kimberly was informed of Robert's passing immediately upon his death, Jean claimed title to the real properties by reason of the joint tenancy and did not file a probate action, and Kimberly filed the instant motion to place a lien on the joint tenancy interest more than one year after Robert's death. The court held that Kimberly's motion was barred by the one-year limitations period contained in section 366.2, as to enforcement of debts against a decedent's estate; the minority tolling provisions of section 352 did not apply; and Kimberly failed to present any facts to support her argument of equitable estoppel. There was no evidence that Jean engaged in any conduct after Robert's death which, in any way, induced Kimberly " to forbear filing the instant action in a timely manner .…"
As for Robert's joint tenancy interest, the court rejected Kimberly's reliance on Perry because there was no evidence Robert actively attempted to avoid his child support obligations through a living trust or other vehicle. The court also rejected Kimberly's argument that federal law broadly defined an " estate" to include joint tenancy interests, since these cases solely addressed reimbursement of Medicaid funds. Instead, the court relied on Grothe and found Jean took Robert's joint tenancy interest immediately upon his death, and there was no " estate" upon which a levy could be had to satisfy Robert's child support obligations. The court found there was no evidence to support Kimberly's contention that Robert and Jean held title in joint tenancy for the sole purpose of frustrating collection of Robert's child support obligations.
The court also found Jean was not a party in the original family law action, the court ordered Kimberly to join Jean as a party when she filed her motion in this case, Jean was served with the summons and notice of motion for joinder but not with a copy of the underlying motion, and Jean consistently challenged the court's jurisdiction over her. The court concluded that Kimberly's failure to serve Jean with the underlying motion violated California Rules of Court, rule 1253, a party could not be properly joined without service of the summons and complaint, notice did not substitute for proper service, and the court did not have personal jurisdiction over Jean or jurisdiction to hear Kimberly's motion.
The court specifically declined to make any findings on the exact amount of child support arrearages in this case. The court also found that life insurance and sick leave benefits received by Jean were exempt from levy and execution, Kimberly did not argue these assets were part of Robert's estate or subject to levy, and Kimberly had waived any claims to these assets.
Issues on Appeal
On November 24, 2004, the court filed a notice of final order in this case. On November 30, 2004, Kimberly filed a timely notice of appeal. On December 7, 2004, Kimberly filed an amended notice of appeal.
On appeal, Kimberly raises the same contentions which were at issue before the trial court: her motion was not barred by the one-year statute of limitations in section 366.2, the statute was tolled by her children's minority since she was trying to enforce the child support obligation on their behalf, the court should not allow Robert's joint tenancy interest in the undeveloped parcel to pass to Jean because it would frustrate the enforcement of his child support obligations, and an " estate" has been broadly defined to include joint tenancy interests. Jean also asserts that Kimberly failed to properly join her as a party in the family law action and she was never before the court in this case.
DISCUSSION
Kimberly contends the court improperly applied a one-year limitations period to her motion, and argues that there is no applicable statute of limitations to enforce a parent's child support obligations based on the unique treatment of child support obligations in California.
To the extent Kimberly challenges any factual findings made by the trial court, our review follows established principles concerning the existence of substantial evidence in support of the findings. We examine the evidence in the light most favorable to the prevailing party, give that party the benefit of every reasonable inference, accept all evidence favorable to the prevailing party, and discard contrary evidence. (In re Marriage of Drake (1997) 53 Cal.App.4th 1139, 1151.) However, to the extent the issues involve the application of legal principles to a set of undisputed facts, we review the trial court's decision de novo. (Ibid.; In re Marriage of Armato (2001) 88 Cal.App.4th 1030, 1034-1035.)
We begin with basic principles of child support obligations. Parents have a statutory obligation to support their children. (In re Marriage of Gregory (1991) 230 Cal.App.3d 112, 115 (Gregory).) A court order to pay child support generally continues until the child reaches 18 years of age, or until the occurrence of any contingency specified in the order. (Ibid.) A court-ordered child support obligation survives the death of the noncustodial parent and becomes a charge upon his or her estate. (Taylor v. George (1949) 34 Cal.2d 552, 556; Gregory, supra, 230 Cal.App.3d at p. 115; Bertrand v. Bertrand (1995) 33 Cal.App.4th 437, 440.)
" Notwithstanding any other provision of law," judgments for child or spousal support, including judgments for arrearages, are enforceable until paid in full, and such judgments are exempt from the requirement that judgments must be renewed. (Fam. Code, § 4502, subd. (a); In re Marriage of Hamer (2000) 81 Cal.App.4th 712, 722; Hogeboom & King, Cal. Practice Guide: Family Law (The Rutter Group 2005) ¶ 18:300, p. 18-98.) Such orders or judgments are enforceable by writ of execution without prior court approval. (Hogeboom & King, supra, ¶ 18:300, p. 18-98.)
" Although it makes a support judgment enforceable until paid in full, [Family Code section] 4502 does not address the procedural requirements for enforcing the judgment against the obligor's assets after his or her death.
" If probate or trust proceedings are pending, support creditors (like all judgment creditors) must file a timely claim in the deceased judgment debtor's estate (Prob.C. § 9100 et seq., 19100 et seq.). If no probate or trust proceedings have been initiated for the obligor's estate, creditor action to enforce claims against property distributed to beneficiaries must be commenced within one year of the obligor's death (CCP §§ 366.2, 366.3) ...." (Hogeboom & King, Cal. Practice Guide: Family Law, supra, ¶ 18:300.4, p. 18-99, second italics added.)
" The Family Code does not generally affect procedural rules regarding the ability to collect on an arrearage claim." (Hogeboom & King, Cal. Practice Guide: Family Law, supra, ¶ 18:3025b, p. 18-101, italics in original.) " Likewise, ... there are procedural bars to arrearages enforcement against a deceased obligor's estate or estate beneficiaries." (Id. at p. 18-102.) Thus, while Family Code section 4502 makes child support judgments enforceable until paid in full, and a noncustodial parent's child support obligations continue after that parent's death, a noncustodial parent who owes child support arrearages is a judgment debtor, and the Family Code does not address the procedural requirements for reaching a judgment debtor's assets after that debtor's death. (Hogeboom & King, supra, ¶ 6:898.1a, p. 6-323.)
As applicable to the instant case, Robert's child support obligations continued after his death, but the Family Code does not address the procedural rules for enforcing such obligations against the decedent parent's assets. The trial court herein found that the one-year limitations period in section 366.2 applied to Kimberly's motion to enforce Robert's child support obligations against his joint tenancy interest after his death, that Robert died on January 7, 2002, but Kimberly did not file her motion until January 22, 2003, more than one year after his death, and her motion was barred by the statute of limitations. Kimberly challenges the trial court's application of section 366.2 to her case.
We thus turn to section 366.2. " [S]ection 366.2 provides for an outside time limit of one year for filing any type of claim against a decedent." (Dobler v. Arluk Medical Center Industrial Group, Inc. (2001) 89 Cal.App.4th 530, 535 (Dobler).) " With limited exceptions, the statute of limitations in ... section 366.2 ... governs causes of action against a decedent that existed at the time of death, 'whether accrued or not accrued.'" (Bradley v. Breen (1999) 73 Cal.App.4th 798, 800 (Bradley).) Section 366.2, subdivision (a) states:
" If a person against whom an action may be brought on a liability of the person, whether arising in contract, tort, or otherwise, and whether accrued or not accrued, dies before the expiration of the applicable limitations period, and the cause of action survives, an action may be commenced within one year after the date of death, and the limitations period that would have been applicable does not apply." (§ 366.2, subd. (a)(1).)
" This uniform one-year statute of limitations applies to action on all claims against the decedent which survive the decedent's death." (Dobler, supra, 89 Cal.App.4th at p. 535; Collection Bureau of San Jose v. Rumsey (2000) 24 Cal.4th 301, 303 (Rumsey).) This one-year limitations period was previously contained in former section 353, but that statute was renumbered and reenacted without substantive change as section 366.2. (Rumsey, supra, 24 Cal.4th at p. 303, fn. 1.)
Section 366.2's limitations period, however, is tolled by (1) the timely filing of a creditor claim; (2) the filing of a petition for payment of debts, claims or expenses from the decedent's revocable trust; or (3) a proceeding to judicially construe a no contest provision. (§ 366.2, subd. (b); Levine v. Levine (2002) 102 Cal.App.4th 1256, 1261; Dobler, supra, 89 Cal.App.4th at p. 535; Bradley, supra, 73 Cal.App.4th at pp. 802-803.)
Section 366.2's limitations period may also be subject to the do
