Opinion ID: 1166192
Heading Depth: 1
Heading Rank: 3

Heading: The Nevada court lacked jurisdiction to divide and award the benefits accruing under the Judges' Retirement Law.

Text: The concept of divisible divorce in California found expression in the classic decision of Hudson v. Hudson (1959) 52 Cal.2d 735 [344 P.2d 295], in which we stated that `In a divorce action in a foreign state upon constructive service the court there has authority to adjudicate status (in rem) of a person residing in that state but has not jurisdiction to adjudicate away (in personam) any of the then vested property rights of the absent spouse who does not reside in such state, who is not personally served with process in that state and who does not appear in the action. The personal rights of the spouses in property not within the jurisdiction of the acting court remain subject to litigation in the proper forum.' (52 Cal.2d at p. 742, quoting concurring opinion of Schauer, J., in DeYoung v. DeYoung (1946) 27 Cal.2d 521, 527 [165 P.2d 457]; see Vanderbilt v. Vanderbilt (1957) 354 U.S. 416, 418 [1 L.Ed.2d 1456, 1459, 77 S.Ct. 1360]; Weber v. Superior Court (1960) 53 Cal.2d 403, 405 [2 Cal. Rptr. 9, 348 P.2d 572].) Acknowledging that Nevada lacked in personam jurisdiction over plaintiff, defendant nevertheless contends that his right to pension benefits is a species of intangible personal property, and that Nevada, as the state of his domicile, could exercise jurisdiction in rem to adjudicate and award title to that property. In support of this contention he cites numerous cases which fix the situs of a debt or chose in action in the state of the creditor's domicile. (See, e.g., Texas v. New Jersey (1965) 379 U.S. 674 [13 L.Ed.2d 596, 85 S.Ct. 626]; McCulloch v. Franchise Tax Bd. (1964) 61 Cal.2d 186 [37 Cal. Rptr. 636, 390 P.2d 412]; Chambers v. Mumford (1921) 187 Cal. 228, 233 [201 P. 588, 42 A.L.R. 342]; Fenton v. Edwards & Johnson (1899) 126 Cal. 43, 46 [58 P. 320].) Plaintiff responds with an equal array of cases holding that the situs of a debt can only repose where the debtor is subject to an in personam action. (E.g., McElroy v. McElroy (1948) 32 Cal.2d 828, 831 [198 P.2d 683]; see Harris v. Balk (1905) 198 U.S. 215 [49 L.Ed. 1023, 25 S.Ct. 625]; Estate of Waits (1944) 23 Cal.2d 676, 680 [146 P.2d 5].) (1) This apparent clash of authorities, however, does not signify any fundamental difference of principle, but serves instead to illustrate the proposition that An intangible, unlike real or tangible personal property, has no physical characteristics that would serve as a basis for assigning it to a particular locality. The location assigned to it depends on what action is to be taken with reference to it. ( Estate of Waits (1944) 23 Cal.2d 676, 680 [146 P.2d 5]; accord, Atkinson v. Superior Court (1957) 49 Cal.2d 338, 342-343 [316 P.2d 960].) (Italics added.) Thus most cases that place the situs of an intangible asset at the domicile of the owner do so to enable the jurisdiction of the owner's domicile to tax that property or the income derived from it. (See McCulloch v. Franchise Tax Bd. (1964) 61 Cal.2d 186 [37 Cal. Rptr. 636, 390 P.2d 412]; Chambers v. Mumford (1921) 187 Cal. 228 [201 P. 588, 42 A.L.R. 342]; Mackay v. San Francisco (1900) 128 Cal. 678 [61 P. 382].) Texas v. New Jersey (1965) 379 U.S. 674 [13 L.Ed.2d 596, 85 S.Ct. 626], adopted a similar rule for escheat. (2) When, however, the issue, as in this case, involves jurisdiction to compel the obligor to pay one claimant and not a competing claimant, the debt or claim is usually regarded as having a situs in any state in which personal jurisdiction of the debtor can be obtained. (1 Witkin, Cal. Procedure (2d ed. 1970) p. 685; see Harris v. Balk (1905) 198 U.S. 215 [49 L.Ed. 1023, 25 S.Ct. 625] [garnishment]; McElroy v. McElroy (1948) 32 Cal.2d 828 [198 P.2d 683] [suit to enforce constructive trust]; but see Fenton v. Edwards & Johnson (1899) 126 Cal. 43 [58 P. 320] [garnishment].) Hanson v. Denckla (1958) 357 U.S. 235 [2 L.Ed.2d 1283, 78 S.Ct. 1228], is particularly in point. Florida residents filed suit in Florida to establish their right to certain intangible property held by a trust established and administered in Delaware. Other claimants to that property, who were not residents of Florida, denied Florida's jurisdiction to adjudicate the matter. When the Delaware courts refused full faith and credit to Florida's decree favoring the claim of its residents, the issue reached the United States Supreme Court. Before that court, the Florida claimants argued that Florida could exercise in rem jurisdiction over the trust on the theory that the situs of intangible property follows the domicile of the owner  exactly the contention advanced by defendant in this case. The Supreme Court rejected the argument, stating that [f]or the purpose of jurisdiction in rem the maxim that personalty has its situs at the domicile of its owner is a fiction of limited utility.... The fact that the owner is or was domiciled within the forum State is not a sufficient affiliation with the property upon which to base jurisdiction in rem. (357 U.S. at p. 249 [2 L.Ed.2d at p. 1295].) (3) In the instant case, the purpose of assigning a situs to the pension rights is to establish jurisdiction to award those rights on dissolution of the marriage. Within this context, jurisdiction should be determined in the light of the totality of contacts with the state involved and the bearing that local contacts have to the question of over-all fair play and substantial justice. ( Atkinson v. Superior Court (1957) 49 Cal.2d 338, 345-347 [316 P.2d 960].) (4) Accordingly, we enumerate the relevant contacts of each state in the present case. The benefits here at issue arise from defendant's contributions while a judge in California, augmented by California tax revenues. The laws of California, not those of Nevada, define defendant's pension rights, and the laws of this state likewise fix the character of those rights as separate or community property. It was his service as a judge in California that entitles defendant to a pension, and during those years he was, of course, a resident of California. The pensioner's former wife, the plaintiff, remains a resident of California. The obligor of the claims asserted here, the Judges' Retirement Fund, is a fund established in the State Treasury of California and administered by California's State Controller. [2] Under these circumstances the fact that defendant, after retirement, established domicile in Nevada is far outweighed by the multiple relevant contacts of California. We believe, moreover, that assignment of the situs of the pension benefits to California will promote the more efficient judicial administration (see Texas v. New Jersey (1965) 379 U.S. 674, 683 [13 L.Ed.2d 596, 602, 85 S.Ct. 626]) and will be the more likely to aid in achieving a satisfactory division of the community property. When the foreign court lacks personal jurisdiction over the California spouse and in rem jurisdiction over the real and personal property which remains in California, the grant of jurisdiction over intangible assets to the foreign court may result in a piecemeal, inefficient, and sometimes inequitable disposition of the community property. In such a case the California court, as the only court that can exercise jurisdiction over all the parties and all community assets, constitutes the better equipped tribunal to adjudicate an equitable division of the community property.