Court Opinion

ID: 6327531
Source: CourtListenerOpinion
Date Created: 2022-03-28 22:01:47.986252+00
Date Added: 2024-06-11T09:22:26.353354
License: Public Domain

Filed 3/28/22 Hogan v. Hogan CA4/3

                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

                IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     FOURTH APPELLATE DISTRICT

                                                DIVISION THREE

 ANDREA P. HOGAN,

      Plaintiff and Appellant,                                         G059131

           v.                                                          (Super. Ct. No. 00D003239)

 GREGORY A. HOGAN et al.,                                              OPINION

      Defendants and Respondents.

                   Appeal from a judgment of the Superior Court of Orange County, James L.
Waltz, Judge. Request for judicial notice granted. Reversed and remanded with
instructions.
                   The Ryan Firm, Timothy M. Ryan, Andrew J. Mase, and Katherine K.
Meleski for Plaintiff and Appellant.
                   Law Offices of Michael Leight, Michael Leight and John Gloger for
Defendants and Respondents.
              In this partition matter, Andrea P. Hogan1 challenges the trial court’s
determination that a grant deed conveying a one-third ownership interest to her in a
residential property only entitled her to “1/3 of the equity that accrued from December 8,
2014 and forward.” We agree the trial court erred, and remand the matter for further
proceedings in accordance with this opinion.
                                           FACTS
              Andrea is an adult daughter of Gregory and Laurie Hogan (collectively
referred to as Parents). From November 1987 to December 10, 2014, Parents were the
sole owners of the property at issue in this case (Property).
              In 2013, Gregory asked Andrea to pay delinquent taxes on the Property,
which she did. When he was unable to make a tax payment in 2014, Gregory again asked
her to make that payment. Andrea agreed to make all tax payments going forward, as
well as all insurance, repair, and maintenance costs until the Property was sold, in
exchange for a one-third ownership interest.
              To document their agreement, Gregory retained his own attorney to prepare
the grant deed, which conveyed the unlimited agreed-upon 1/3 interest to Andrea. The
grant deed did not include any exception or limitation of rights, and, specifically, it did
not reserve the existing equity in the home to Parents.
              Following their agreement, Andrea paid property taxes, insurance, and for
all repairs on the Property from 2014 until at least April 2019. Gregory did not pay any
of the taxes, insurance, or repairs on the Property from December 2014 onward.
              In 2017, Andrea filed a complaint for partition of real property, an
accounting, and declaratory relief. The pleading named Parents, her grandparents
Ainslee and Lola Hogan (who gave the initial loan to Parents to purchase the Property),
Union Bank, N.A., and all persons unknown claiming any legal or equitable right, title,

1          Because the parties share the name last name, we refer to them by their first
names. We do so for clarity and intend no disrespect.

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estate, lien or interest in the Property adverse to Andrea’s title, or any cloud upon her
title. Gregory filed a cross-complaint for declaratory relief and to void the grant deed.
              Following Gregory’s request for consolidation of Andrea’s partition action
with his marriage dissolution action, and over Andrea’s objection, the trial court
consolidated the two cases. It proceeded to a bifurcated bench trial in April 2019.
              Gregory stated he initiated and directed his attorney to prepare the grant
deed transferring title to Andrea. He admitted it was his idea to give Andrea a one-third
ownership interest. He testified he intended to give Andrea the grant deed so she could
substantiate her ownership interest if confronted by any tax authorities.
              Andrea’s sister, Kari Hogan, testified Gregory admitted outside his
lawyer’s office that he was the one who decided to provide Andrea with a one-third
ownership interest. This was despite his attorney’s recommendation to provide her with
only a 10 percent interest. Andrea and Laurie stated Gregory spoke to Andrea four or
five times regarding their agreement for her to make the requested payment and all future
property taxes, insurance premiums, and repair payments until the Property was sold in
exchange for a one-third ownership interest.
              At trial, Andrea, Parents, and Kari all testified that Andrea had been, and
remains, the only one with the means to pay the property taxes, insurance premiums,
repairs, and other expenses associated with the Property. Andrea made all the agreed-
upon payments. Andrea estimated she spent over $75,000 on the Property from the time
she obtained her one-third interest until trial. This was confirmed by copies of bank
statements admitted into evidence. She testified she agreed to and made the payments as
an investment, and in reliance upon her father’s promise she would be a full one-third
owner of the Property.
       After a two-day bench trial on the partition action, the trial court ruled in favor of
Andrea on the issue of ownership. It determined the grant deed was valid and that it
conveyed a full one-third tenant-in-common fee interest in the Property to Andrea. It

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ruled against Andrea regarding distribution of funds from the sale of the Property and
denied her request for reimbursement of the $75,000 spent on the Property. The court
concluded Andrea was only entitled to share in the appreciation that had accrued after she
became an owner, “Andrea is entitled to share [one-third] of the net equity that accrued
after December 8, 2014 to the date of sale.” There was no evidence presented at trial
Parents or Andrea intended for the grant deed to only entitle Andrea to one-third of any
appreciation accruing after she obtained ownership.
              However, based on the trial court’s order to release the parties’ valuation
witnesses, no expert evidence was presented as to the value of the Property before or after
the conveyance. Although the parties retained real estate valuation experts to testify at
trial regarding the value of the Property, the court dismissed those experts for this phase
of the trial. The only evidence presented regarding appreciation came from the parties
themselves.
              Andrea testified she had no personal knowledge of the value. Laurie
expressed no opinion as to the fair market value of the Property in 2014, but testified that
at the time of trial, she believed the Property was worth $1.2 million. She also testified it
was her opinion Andrea was entitled to one-third of the net proceeds of the sale of the
Property. Laurie stated, “If she didn’t step forward, we wouldn’t have gotten anything.”
              Gregory testified the Property had not appreciated in value between the
time the grant deed was recorded and the time of trial. He stated the fair market value at
the time of trial was $1.4 million. His opinion was based on his research of comparable
real estate in the Lemon Heights area. Gregory believed the fair market value had also
been close to $1.4 million in 2014 because the realtor had suggested listing it at $1.385
million and he had, again, engaged in independent research confirming the price of
comparable properties and sales on the Internet.
              The trial court conducted its own research of the Property that was not
presented as evidence at trial. “For the record I want to tell the lawyers something I just

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did. I culled up my Internet service. I dialed in through Zillow [the Property’s address].
I wanted a visual of this home that [Gregory] says did not appreciate. It’s a four-
bedroom, three-bath home. It’s 3,791 square feet. . . . [¶] It seems like a one-story home
from its picture. It looks like a very lovely home. I’m also familiar with Lemon Heights
and that neighborhood, and it is a nice neighborhood and very desirable in 2014 and
today.” The court further noted its previous education, training, and experience as a real
estate agent and broker. It remarked it would “be very surprised to learn that the home
has not appreciated from 2014 to 2019.” The court alluded to ordering an appraisal to
determine the value in 2014 and the current value, but we see no evidence this actually
occurred.
                 In its final statement of decision, the court concluded as follows:
“Andrea’s share of net equity from December 8, 2014 and forward was bargained for
proportional to the risks she understood, and Andrea is entitled to that growth in value
notwithstanding the growth in value was due not to her direct efforts, [but] collateral to
[the] robust real estate market (with escalating property values) and the uniqueness of this
attractive single family home in Lemon Heights, an up-scale community nestled in the
Tustin Hills.”
                 The court further determined prior to this litigation, Gregory “never
claimed the deed was incorrect, invalid and along the way, Gregory accepted Andrea[s]
financial help.” It stated Gregory “testified that he signed the grant deed ‘freely and
voluntarily’ and understood that the document would show that Andrea was a 1/3 owner
of the . . . Property” and that he “understood the legal effect of that document and that
recorded deed changed title by adding Andrea to title, now a 1/3 owner.” It further
adjudged Gregory’s position at trial as “absurd” and found him “not credible.”
                 The court concluded, “Under principals of equity, the court’s ruling
reconciles and matches Andrea’s risk/reward to the date of her 1/3rd ownership and
forward, not retroactively. For Andrea to demand more is a huge overreach and an

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absurd result. For Gregory to insist Andrea is not entitled to any share of the equity is a
huge overreach and an absurd result.”
              By stipulation of the parties, at the conclusion of trial, the court ordered the
Property sold immediately. After trial, the Property sold for $1,275,000. 2
                                        DISCUSSION
              Andrea asserts the trial court erroneously and inequitably deprived her of
any interest in the Property when it determined the intent of the parties was to share only
prospective equity with her. We agree.
I. Standard of Review and Underlying Legal Principles
              We review the trial court’s interlocutory judgment of partition for abuse of
discretion. (Cummings v. Dessel (2017) 13 Cal.App.5th 589, 597.) “Under that standard,
‘[t]he trial court’s “application of the law to the facts is reversible only if arbitrary and
capricious.” [Citation.]’ . . . ‘[A] disposition that rests on an error of law [also]
constitutes an abuse of discretion. [Citations.]’ [Citation.]” (Ibid.)
              ‘“An abuse of discretion occurs if, in light of the applicable law and
considering all of the relevant circumstances, the court’s decision exceeds the bounds of
reason and results in a miscarriage of justice. [Citations.] The abuse of discretion
standard affords considerable deference to the trial court, provided that the court acted in
accordance with the governing rules of law. ‘“The discretion of a trial judge is not a
whimsical, uncontrolled power, but a legal discretion, which is subject to the limitations
of legal principles governing the subject of its action, and to reversal on appeal where no
reasonable basis for the action is shown. [Citation.]’ [Citations.]” [Citation.] A
decision “that transgresses the confines of the applicable principles of law is outside the
scope of discretion’ and is an abuse of discretion. [Citation.]’ [Citation.]” (Kayne v. The
Grande Holdings Limited (2011) 198 Cal.App.4th 1470, 1474-1475.)

2             See request for judicial notice argument below.

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               Partition is the legal procedure utilized to segregate and terminate common
interests in the same parcel of real property. (14859 Moorpark Homeowner’s Assn. v.
VRT Corp. (1998) 63 Cal.App.4th 1396, 1404-1405.) Code of Civil Procedure section
872.720, subdivision (a), governs this process, advising that “[i]f the court finds that the
plaintiff is entitled to partition, it shall make an interlocutory judgment that determines
the interests of the parties in the property and orders the partition of the property . . . .”
(Code Civ. Proc., § 872.720, subd. (a).) The order of partition “shall order that the
property be divided among the parties in accordance with their interests . . . as determined
in the interlocutory judgment.” (Code Civ. Proc., § 872.810.)
II. Analysis
               The court properly found the “language of the deed was clear,” establishing
Andrea as holding a one-third interest in the property. Perplexingly, notwithstanding the
clear evidence of Andrea’s rights to share in one-third of the property, the court then went
on to unequally distribute the net proceeds of the sale, ultimately leaving Andrea with
nothing. Despite finding the evidence at trial “overwhelming” establishing Andrea’s one-
third ownership interest, the court somehow also found that the evidence
“overwhelmingly” established Parents intended to share only prospective equity with
Appellant in exchange for her financial support. However, there was no credible
evidence the parties intended for or even discussed Andrea would receive less than a full
one-third interest.
               Indeed, the statement of decision does not identify or rely upon a single
piece of evidence in support of this finding. With no evidence to back its decision,
the trial court surprisingly held the evidence presented did not support Andrea’s
entitlement as a one-third owner to one-third of the net sales proceeds of the Property.
               The court determined, “Andrea failed to prove under any fact, equitable
principles, or law, a right to 1/3 of the total property equity.” The record belies this
assertion. The strongest evidence in support of her right to one-third of the total property

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equity is the grant deed. It demonstrated Parents knowingly conveyed an unrestricted
one-third ownership interest in the Property to Andrea. Testimony also demonstrated the
Property did not appreciate between December 2014 and the trial date.
              The court asserted Andrea’s share of net equity, only from 2014 forward,
was ‘“bargained for.’” Not so. There was no evidence introduced to support a finding
that Gregory and Andrea ever agreed she would only receive one-third of the equity
arising only after the grant deed was recorded.
              The evidence instead demonstrated Parents could not afford the expenses of
the Property, Gregory’s parents were unwilling to provide further funds, and that the only
way for Parents to keep the Property was to enlist Andrea’s help. Moreover, the court
found Gregory to be not credible and properly disregarded his testimony that Andrea
never expected to receive any financial interest in the home.
              Ultimately, while we disagree with the trial court’s assertion Andrea’s
share in prospective equity was somehow bargained for, we recognize the court’s broad
discretion in partition matters. We reverse, however, because the trial court relied on its
own research and experience to establish the Property appreciated in value from 2014 to
the time of trial. The court released the parties’ real estate valuation experts. There was
no testimony or other evidence demonstrating the Property appreciated in value after
Andrea became an owner. To the contrary, testimony by the parties demonstrated the
Property did not appreciate. The court’s independent research into the value of the
Property did not constitute evidence.
              The court stated the Property “seems like a one-story home from its picture.
It looks like a very lovely home. I’m also familiar with Lemon Heights and that
neighborhood, and it is a nice neighborhood and very desirable in 2014 and today.” The
court’s conclusion there was “growth in value” due to a “robust real estate market (with
escalating property values) and the uniqueness of this attractive single family home in
Lemon Heights, an up-scale community nestled in the Tustin Hills” was not based upon

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any evidence at trial. Instead, it appeared based upon its independent Internet research on
the Zillow Web site. And, as it turned out, the court’s independent real estate research
was wrong.
              The Model Code of Judicial Conduct, Model rule 2.9(C) specifically
precludes a judge from investigating facts independently and requires that it only
consider evidence presented and facts that may be judicially noticed. (ABA Model Code
of Jud. Conduct, rule 2.9(C).) There is no indication the information obtained by the
court’s research was subject to such judicial notice. (See Evid. Code, § 455, subd. (b).)
Additionally, the court’s apparent reliance on Zillow’s value of the Property is
particularly troublesome. As the United States Bankruptcy Appellate Panel of the Ninth
Circuit observed, “The Zillow ‘Zestimate’ is particularly questionable. As Zillow itself
says: The Zestimate is not an appraisal and can’t be used in place of an appraisal. It is a
computer-generated estimate of the value of a home today, given the available data. [¶]
The Zestimate should not be used as the basis of any specific financial transaction
because data sources may be incomplete or incorrect. The Zestimate is a starting point
and does not consider all the market intricacies that can determine the actual price a home
will sell for. [Citation.]” (In re Ogletree (B.A.P. 9th Cir., 2020, No. 19-50392-SLJ)
2020 WL 6557434, at *5, fn. 5.)
              The court’s determination Andrea would be adequately compensated for
her investment by the appreciation from December 2014 forward was pure speculation
and was not based on the evidence before it. Accordingly, the court’s finding that
Andrea failed to present facts to justify her entitlement to all rights associated with a
tenant-in-common interest was not a conclusion reached after weighing credible
evidence, nor was it supported by law. The court’s statement that Andrea’s claim was
unsupported by facts is entirely contradicted by the record. Furthermore, the court’s legal
error resulted in a miscarriage of justice. It entirely deprived Andrea of any interest in

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the property and deprived her of reimbursement of the approximately $75,000 she had
spent on the Property.
              We acknowledge the court’s inherent powers to do equity in a partition
action. As explained above, the court’s determinations were based upon mere
speculation instead of facts in evidence. In any event, we address the issue of equity as a
guiding principle for the trial court on remand. The court apparently sought to do equity
by giving Parents a larger share of the property because they had owned it longer than
Andrea. In so doing, however, it prevented Andrea from sharing in any of the equity.
              The court may apportion proceeds in an equitable manner. Often this
means determining the ownership rights and ordering an accounting. Any such
determination, however, must be supported by admissible evidence, not speculation.
Here, the ownership interests are unequivocable. It is undisputed Andrea, Gregory, and
Laurie each own one-third of the Property. Based upon this record, we see no reason
why the court should ignore the contractually agreed upon rights of the parties on
remand. If anything, it appears equity concerns weigh in favor of Andrea based upon her
significant contributions to the property. The trial court’s purportedly equitable remedy
providing Andrea with nothing and denying her request for reimbursement of the
approximately $75,000 spent on the Property resulted in a miscarriage of justice.
              Finally, we reject Respondents’ attempts to apply legal principals
applicable to property ownership and apportionment in dissolution actions. Those are
irrelevant to this partition as Andrea is obviously not a spouse or party to the underlying
dissolution action.

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III. Request for Judicial Notice
              Pursuant to Rule 8.252(a) of the California Rules of Court and
Evidence Code section 459,3 Andrea requests we take judicial notice of the grant deed
from the posttrial court ordered sale of the Property. Respondents object. We grant
Andrea’s request for judicial notice.
              Under section 452, subdivision (h), we may take judicial notice of, “Facts
and propositions that are not reasonably subject to dispute and are capable of immediate
and accurate determination by resort to sources of reasonably indisputable accuracy.”
This includes recorded deeds. (Maryland Casualty Co. v. Reeder (1990) 221 Cal.App.3d
961, 977.) Under section 459, subdivision (d), we may take judicial notice of evidence
not presented at trial, but which is appropriate for judicial notice, as long as each party is
afforded a reasonable opportunity to “meet” such evidence before notice of the matter is
taken.
              The grant deed is subject to judicial notice under section 452, subdivision
(h), because it is “not reasonably subject to dispute” and is “capable of immediate and
accurate determination by resort to sources of reasonably indisputable accuracy.” The
official records of the Orange County Clerk-Recorder meet this requirement.
Additionally, the grant deed is relevant and critical to this appeal. It demonstrates the
trial court’s evidentially unsupported presumption the Property appreciated in value
between 2014 and the time the property was sold was incorrect and without any factual
basis. The grant deed provides evidence the Property did not appreciate during the
relevant timeframe based on the documentary transfer sales tax being extrapolated to
show the purchase price of $1,275,000.4 We are satisfied the briefing on this issue

3             All further statutory references are to the Evidence Code, unless otherwise
indicated.

4           This sale price can be extrapolated from the grant deed based upon the
documentary transfer tax paid, which was $1,402.50. Transfer tax is $0.55 for each five

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provided each party a reasonable opportunity to “meet” the information, as required by
section 459, subdivision (d).
                                     DISPOSITION
              We reverse the trial court’s interlocutory judgment and remand the matter
for further proceedings. On remand, the trial court must reconsider its decision awarding
unequal distribution of proceeds from the Property. The court may not redetermine
ownership rights on remand, as the court previously made a factual finding supported by
admissible evidence, and parties do not dispute, that Parents and Andrea each share
one-third ownership in the Property. The request for judicial notice is granted. Andrea
shall recover her costs on appeal.

                                                O’LEARY, P. J.

WE CONCUR:

MOORE, J.

MARKS, J.*

*Judge of the Orange County Superior Court, assigned by the Chief Justice pursuant to
article VI, section 6 of the California Constitution.

hundred dollars. (Rev. & Tax. Code, § 11911.) As such, $1,275,000 divided by $500
equals $2,550. $2,550 multiplied by $0.55 equals $1,402.50, which is the amount of
transfer tax identified on the grant deed.

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