Source: https://www.gwwlaw.com/cases/in-re-marriage-of-huntley/
Timestamp: 2019-04-22 14:15:29+00:00

Document:
The Third District Court of Appeal of California has decided that a trial court erred by denying a wife’s motion to divide community property which was not previously identified under Fam C §2556. They reasoned that the wife was not required to file a prior motion to set aside of a default dissolution judgment before seeking to divide previously unadjudicated community property and was not, therefore, precluded from seeking a division of the property some two years after the dissolution judgment was entered.
In re the Marriage of FRANK and DEANNA HUNTLEY. FRANK HUNTLEY, Respondent, v. DEANNA HUNTLEY, Appellant.
Prior History: [***1] APPEAL from a judgment of the Superior Court of Yolo County, No. FL11001946, Kathleen M. White, Judge.
HOLDINGS: -A trial court should have adjudicated the omitted community property as requested in an ex-wife’s motion under Fam. Code, § 2556, because § 2556 provided the court with continuing jurisdiction to divide omitted or unadjudicated community property, and because it erred in ruling the ex-wife was required to move to set aside the default judgment that dissolved her marriage before availing herself of that continuing jurisdiction; -Because the dissolution judgment did not divide — or even mention — any community property, the parties’ community property remained subject to future litigation; -Although the ex-wife handled the finances during the marriage and was aware of the very community property she sought to have divided under § 2556, her knowledge did not provide a basis for denying her motion.
Judgment reversed and matter remanded.
Appellate courts review questions of statutory interpretation under the independent standard of review. In doing so, courts’ fundamental task is to ascertain the intent of the lawmakers so as to effectuate the purpose of the statute. Courts start with the language of the statute, giving the words their usual and ordinary meaning, while construing them in light of the statute as a whole and the statute’s purpose.
Generally, once a marital dissolution judgment has become final, the court loses jurisdiction to modify or alter it. However, a dissolution judgment does not affect the disposition of community property as to which the judgment is silent. Under California law, a spouse’s entitlement to a share of the community property arises at the time that the property is acquired. That interest is not altered except by judicial decree or an agreement between the parties. Hence, property that is not mentioned in the pleadings as community property is left unadjudicated by decree of divorce, and is subject to future litigation, the parties being tenants in common meanwhile. This rule applies to partial divisions of community property as well as divorces unaccompanied by any property adjudication whatsoever.
In providing courts with continuing jurisdiction, Fam. Code, § 2556, imposes no time limit on former spouses to seek to adjudicate omitted or unadjudicated community property after a dissolution judgment was entered. There is no statute of limitations imposed by § 2556 on a former spouse who seeks adjudication of omitted or unadjudicated community property. Section 2556 also imposes no limitation for default judgments. Accordingly, § 2556 applies to require adjudication of the omitted assets. Section 2556 applies even when former spouses were aware of the community property at the time the dissolution judgment was entered.
Although Code Civ. Proc., § 473, generally governs the finality of most default judgments, Fam. Code, § 2556, is the more specific statute in specifically addressing assets omitted from a dissolution of marriage. It is the general rule that where the general statute standing alone would include the same matter as the special act, and thus conflict with it, the special act will be considered as an exception to the general statute whether it was passed before or after such general enactment. The legislature’s specific provision in Fam. Code, § 2556, for adjudication of assets omitted from a marital dissolution judgment is the more specific statute and supplies the governing rule in such cases.
Fam. Code, § 2556, applies to community property not actually adjudicated in the previously entered dissolution judgment. The mere mention of an asset in the judgment is not controlling.
The crucial question is whether the community property benefits were actually litigated and divided in the previous proceeding.
Former spouses may divide their community property by agreement, even if the division is not equal. As long as such agreement is based upon a complete and accurate understanding of the existence and value of community and separate assets that are material to the agreement, the parties are free to decide on an unequal distribution. However, to be valid, even an agreement to divide community property equally must comply with Fam. Code, § 2550. The requirement of § 2550 that an agreement either be written or orally stated in open court is strictly construed. Strictly enforcing § 2550’s requirements will actually promote the policy of encouraging the parties to arrive at an out-of-court resolution containing sufficiently definite terms to be enforced by the court without further litigation. Requiring the parties’ settlement agreement to be committed to writing or recited in court, as mandated by § 2550, prevents the risk of the court enforcing an agreement that never was made.
Courts’ fundamental task in interpreting a statute is to ascertain the intent of the lawmakers so as to effectuate the purpose of the statute. Courts start with the language of the statute, giving the words their usual and ordinary meaning, while construing them in light of the statute as a whole and the statute’s purpose.
Dissolution of Marriage § 49—Final Judgment—Effect on Jurisdiction—Community Property—Disposition of Omitted Assets.
Dissolution of Marriage § 49—Division of Community Property—Continuing Jurisdiction—Omitted Assets.
Although Code Civ. Proc., § 473, generally governs the finality of most default judgments, Fam. Code, § 2556, is the more specific statute in specifically addressing assets omitted from a dissolution of marriage. It is the general rule that where the general statute standing alone would include the same matter as the special act, and thus conflict with it, the special act will be considered as an exception to the general statute whether it was passed [*1055] before or after such general enactment. The Legislature’s specific provision in Fam. Code, § 2556, for adjudication of assets omitted from a marital dissolution judgment is the more specific statute and supplies the governing rule in such cases.
Dissolution of Marriage § 49—Division of Community Property—Continuing Jurisdiction—Unadjudicated Property.
Fam. Code, § 2556, applies to community property not actually adjudicated in the previously entered dissolution judgment. The mere mention of an asset in the judgment is not controlling. The crucial question is whether the community property benefits were actually litigated and divided in the previous proceeding.
Dissolution of Marriage § 49—Division of Community Property—Continuing Jurisdiction—Adjudication of Omitted Assets.
The trial court erred in ruling an ex-wife was required to move to set aside the default judgment that dissolved her marriage to her ex-husband before availing herself of the continuing jurisdiction provided by Fam. Code, § 2556, for division of unadjudicated community property. The dissolution judgment did not divide—or even mention—any community property. Consequently, the parties’ community property remained subject to future litigation. Even though the ex-wife waited more than two years after entry of the default judgment before bringing her motion for adjudication of omitted assets, the trial court had jurisdiction under § 2556 to hear the motion. Although it was undisputed the ex-wife handled the finances during the marriage and was aware of the very community property she sought to have divided under § 2556, her knowledge did not provide a basis for denying her motion. Consequently, the trial court should have adjudicated the omitted community property as requested in the ex-wife’s motion.
Dissolution of Marriage § 75—Property Settlement Agreements—Requirements—Written or Recited in Court.
Former spouses may divide their community property by agreement, even if the division is not equal. As long as such agreement is based upon a complete and accurate understanding of the existence and value of community and separate assets that are material to the agreement, the parties are free to decide on an unequal distribution. However, to be valid, even an agreement to divide community property equally must comply with Fam. Code, § 2550. The requirement of § 2550 that an agreement either be [*1056] written or orally stated in open court is strictly construed. Strictly enforcing § 2550’s requirements will actually promote the policy of encouraging the parties to arrive at an out-of-court resolution containing sufficiently definite terms to be enforced by the court without further litigation. Requiring the parties’ settlement agreement to be committed to writing or recited in court, as mandated by § 2550, prevents the risk of the court enforcing an agreement that never was made.
Counsel: Matthew B. Smith for Appellant.
Bair & Bair and Pamela A. Bair for Respondent.
Judges: Opinion by Hoch, J., with Butz, Acting P. J., and Renner, J., concurring.
[**905] HOCH, J.—Deanna Huntley challenges the trial court’s denial of her motion to divide unadjudicated community property under Family Code section 2556.1 Deanna filed her motion more than two years after entry of a default judgment that dissolved her marriage to Frank Huntley.2 The trial court denied the motion on grounds Deanna had not first moved to set aside the default judgment.
[**906] On appeal, Deanna contends (1) section 2556 confers the trial court with continuing jurisdiction to adjudicate omitted community property without having to first move to set aside the judgment, (2) the dissolution judgment’s silence as to the division of any property means all of the community property remains to be divided, and (3) the trial court’s error requires reversal for proper division of the parties’ community property.
We conclude section 2556 provided the trial court with continuing jurisdiction to divide omitted or unadjudicated community property. The default judgment’s silence as to [***2] any division of property requires reversal and remand for further proceedings under sections 2550 and 2556.
In December 2011, Frank served Deanna with a petition for dissolution of marriage, an income and expense declaration, and a community and quasi-community property declaration. Frank’s petition stated all community and quasi-community property was listed in his accompanying declaration. However, the declaration did not list any property other than a house with a negative value of $89,000.
Deanna was served with the petition and attached declarations, but did not respond. In July 2012, Frank filed a request for default and served Deanna with a copy of the request. In October 2012, the trial court entered a default judgment. The default judgment dissolved the marriage but did not mention any community property.
At some point after Deanna received the request to enter a default judgment, she signed a grant deed conveying all title and interest in the house to Frank.
Deanna contends a motion to vacate the default judgment was not necessary because section 2556 provided the trial court with continuing jurisdiction to hear her “motion for adjudication of omitted assets.” The contention has merit.
HN3 CA(3) (3) In providing courts with continuing jurisdiction, section 2556 imposes no time limit on former spouses to seek to adjudicate omitted or unadjudicated community property after a dissolution judgment was entered. In Lakkees, supra, 222 Cal.App.3d 531, the Court of Appeal noted arguments “that a dilatory party who suffers an involuntary dismissal should be barred from the postjudgment relief available under Civil Code former section 4353 are not supported by any statutory language.” (Id. at p. 540, fn. 5.) The same observation holds true [***8] for Civil Code section 4353’s successor: there is no statute of limitations imposed by Family Code section 2556 on a former spouse who seeks adjudication of omitted or unadjudicated community property. Section 2556 also imposes no limitation for default judgments such as that entered in this case. Accordingly, section 2556 applies to require adjudication of the omitted assets.
HN4 CA(4) (4) Although Code of Civil Procedure section 473 generally governs the finality of most default judgments, it does not control in this case. Section 2556 is the more specific statute in specifically addressing assets omitted from a dissolution [**909] of marriage. As the California Supreme [***9] Court has held, “‘It is the general rule that where the general statute standing alone would include the same matter as the special act, and thus conflict with it, the special act will be considered as an exception to the general statute whether it was passed before or after such general enactment.’” (People v. Gilbert (1969) 1 Cal.3d 475, 479 [82 Cal. Rptr. 724, 462 P.2d 580], quoting In re Williamson (1954) 43 Cal.2d 651, 654 [276 P.2d 593]; accord, Stone Street Capital, LLC v. California State Lottery Com. (2008) 165 Cal.App.4th 109, 118 [80 Cal. Rptr. 3d 326].) The Legislature’s specific provision in section 2556 for [*1061] adjudication of assets omitted from a marital dissolution judgment is the more specific statute and supplies the governing rule here.
CA(6) (6) The trial court erred in ruling Deanna was required to move to set aside the default judgment before availing herself of the continuing jurisdiction provided by section 2556 for division of unadjudicated community property. The dissolution judgment did not divide—or even mention—any community property. Consequently, [***10] the parties’ community property remained “‘“subject to future litigation.”’” (Henn, supra, 26 Cal.3d 323, 330; see § 2556.) Even though Deanna waited more than two years after entry of the default judgment before bringing her motion for adjudication of omitted assets, the trial court had jurisdiction under section 2556 to hear the motion. (See Lakkees, supra, 222 Cal.App.3d at p. 540, fn. 5.) Although it is undisputed Deanna handled the finances during the marriage and was aware of the very community property she sought to have divided under section 2556, her knowledge did not provide a basis for denying her motion. (Huddleson, supra, 187 Cal.App.3d at p. 1569.) Consequently, the trial court should have adjudicated the omitted community property as requested in Deanna’s motion.
Frank argues the trial court correctly determined that, even if cognizable, Deanna’s motion was properly denied because all of the community property had actually been divided by the parties according to their informal agreement. As the trial court noted, Deanna’s signing of a grant deed to the marital residence in favor of Frank after entry of the default judgment indicated the parties had actually reached an informal agreement as to the disposition of their property.
Butz, Acting P. J., and Renner, J., concurred.
1 Undesignated statutory citations are to the Family Code.
2 For the sake of clarity, we refer to the parties by their first names.
3 We express no opinion as to the factual question of whether the informal division of community property by Frank and Deanna was equal or unequal within the meaning of sections 2550 and 2556.

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