Court Opinion

ID: 9380293
Source: CourtListenerOpinion
Date Created: 2023-03-17 20:02:20.015723+00
Date Added: 2024-06-11T17:17:24.044602
License: Public Domain

Filed 3/17/23 Marriage of Mustafa CA6
                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS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
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                  IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                      SIXTH APPELLATE DISTRICT

 In re the Marriage of ANWAR and                                     H050056
 NANCY MUSTAFA.                                                     (Santa Clara County
                                                                     Super. Ct. No. 18-FL-003026)
 ANWAR MUSTAFA,

             Appellant,

             v.

 OBDULIA LOPEZ,

             Respondent.

         Appellant Anwar Mustafa appeals from a trial court order modifying temporary
child and spousal support. Mustafa asserts the order was erroneously based on
unforgivable loans he had received and was obligated to repay. He contends that Family
Code section 40581 does not permit loan funds to be used as income for calculating
guideline child support.
         We conclude that Mustafa has failed to establish the factual premise for his claim
of error and affirm the order.

         1   Unspecified statutory references are to the Family Code.
                  I. FACTS AND PROCEDURAL BACKGROUND
       Anwar and respondent Nancy Mustafa, who goes by the name Obdulia Lopez, had
been married for 26 years when they separated in 2018. They have one adult child and
one minor child, and the minor child remained in Lopez’s sole custody after separation.
Anwar filed for dissolution of their marriage in July 2018. The initial December 2018
temporary child and spousal support order required Anwar to pay $1,262 a month in
spousal support and $1,683 a month in child support to Lopez.
       In August 2020, at Anwar’s request, Anwar’s temporary child and spousal support
obligations were reduced to $0 due to his asserted loss of income as a result of the
pandemic. Anwar’s income was derived from his business, which operated cafeterias at
three community college campuses. When the pandemic began in 2020, all of the
campuses closed. At the August 2020 hearing, the court declined to consider as income
to Anwar $72,000 his business had received in “Paycheck Protection Program” (PPP)
funds because these funds were for business purposes. Both before and after the August
2020 order, Anwar repeatedly transferred funds from his business account to his personal
account to pay his personal expenses.
       In November 2021, Lopez filed a request for modification of the temporary child
and spousal support order. She asserted that Anwar’s prior representations that he had no
business income were inaccurate because he had failed to disclose that he had received
“PPP loan funds” that he had transferred from his business account to his personal
account. She maintained that these transferred funds were not used for business expenses
but to fund Anwar’s personal expenses. On this basis, she argued that the transferred
funds were “available to him for purposes of support.” Lopez asserted that these
transfers added up to $9,000 per month in income, and she sought monthly child support
in the amount of $2,132. However, her expert’s analysis of Anwar’s income, based on
these transfers, showed that Anwar had received an average of $3,376.16 per month in
“Draws” from the business in 2021.
                                                2
      Lopez submitted Anwar’s business and personal bank records in support of her
request. Anwar’s business’s bank records showed a $10,000 April 2020 deposit, a May
2020 deposit of $71,420, and a $149,900 deposit in July 2020. His personal bank records
showed that Anwar had made a series of transfers of funds from his business’s account to
his personal account. Anwar’s business’s balance sheet showed a $392,696.68 balance as
of October 20, 2021.2 This balance sheet also reflected that the business had received a
“PPP Loan” of $431,420 and an “Other” loan of $149,900. According to the balance
sheet, Anwar’s business’s loan obligations exceeded the business’s assets.
      Anwar opposed Lopez’s request. He declared that he had received both “PPP
monies” and “SBA loans,” but he did not specify the amounts. After the community
college campuses partially reopened, Anwar’s business resumed receiving revenues,
though Anwar asserted that his business was unprofitable because so many fewer
students were present on campus. Anwar declared that he received both PPP funds and
funds from the Small Business Administration’s Economic Injury Disaster Loan (EIDL)
program. He did not include any of these funds as income on his income and expense
declarations because he understood that these funds were for business purposes and that
the EIDL loans were required to be repaid. Nevertheless, Anwar continued to transfer
funds from his business account to his personal account to use for his personal expenses.
Anwar admitted that the PPP loan was “forgiven.”
      Anwar’s January 2022 income and expense declaration reported no income but
$370,000 in his bank accounts and monthly expenses of $5,469. Anwar submitted a
profit and loss statement for his business that showed a net loss for 2021. Anwar
conceded that he had taken a “[d]raw[]” of $31,256 from his business for his personal
expenses between January 2021 and October 2021, which amounted to $3,376 per month.

      2 The record does not indicate who prepared this balance sheet, which was
attached as an exhibit to Lopez’s trial counsel’s supplemental declaration and was also
submitted to the court by Anwar’s trial counsel.
                                                3
       Lopez’s request for modification was heard in February 2022. Anwar was the
only witness who testified at the hearing. His testimony did not identify the amounts of
the PPP loans or the EIDL loans. He testified only that he was obligated to repay the
loans at a rate of $30,000 per year. Although his trial counsel argued that Anwar had
received $431,420 in “EIDL” loans that were not “forgivable,” no evidence was
presented to support this asserted amount. His trial counsel also asserted that the
$370,000 in Anwar’s business’s bank account were remaining loan proceeds from EIDL
loans that Anwar was obligated to repay, but no evidence was submitted on this point.
       The court decided that any funds that Anwar withdrew from his business accounts
to pay his personal expenses should be considered income available for support purposes.
The court reviewed the bank records and decided that Anwar had withdrawn $4,878 per
month from his business to pay his personal expenses. Based on that figure, the court
ordered Anwar to pay $1,069 per month in temporary child support and $304 per month
in temporary spousal support beginning at the time Lopez filed her request. Anwar
timely filed a notice of appeal from these orders.
                                     II. DISCUSSION
       Temporary child and spousal support orders are authorized by section 3600. The
“statewide uniform guideline for determining child support” is a mathematical formula
set forth in section 4055. The amount calculated under this formula is “presumed to be
the correct amount of child support to be ordered.” (§ 4057, subd. (a).) The formula
depends on the parents’ “income.” (§ 4055, subd. (b)(1)(B).) Section 4058 defines
“income” for child support purposes. “The annual gross income of each parent means
income from whatever source derived, except as specified in subdivision (c)[3 ] and

       3  Subdivision (c) provides, among other things, that income does not include
“income derived from any public assistance program, eligibility for which is based on a
determination of need.” (§ 4058, subd. (c).) Subdivision (b) provides that a court “may,
in its discretion, consider the earning capacity of a parent in lieu of the parent’s income.”
(Id., subd. (b)(1).)
                                                  4
includes, but is not limited to, the following: [¶] (1) Income such as commissions,
salaries, royalties, wages, bonuses, rents, dividends, pensions, interest, trust income,
annuities, workers’ compensation benefits, unemployment insurance benefits, disability
insurance benefits, social security benefits, and spousal support actually received from a
person not a party to the proceeding to establish a child support order under this article.
[¶] (2) Income from the proprietorship of a business, such as gross receipts from the
business reduced by expenditures required for the operation of the business. [¶] (3) In
the discretion of the court, employee benefits or self-employment benefits, taking into
consideration the benefit to the employee, any corresponding reduction in living
expenses, and other relevant facts.” (§ 4058, subd. (a).) Spousal support orders are
governed by a different standard that takes “into account the supporting party’s earning
capacity, earned and unearned income, assets, and standard of living.” (§ 4320, subd.
(c).)
        The issue that Anwar identifies for our decision is “whether loan proceeds
received through the EIDL constitute income available for support.” However, the record
that he has produced does not present that issue for our consideration. “A judgment or
order of the lower court is presumed correct. All intendments and presumptions are
indulged to support it on matters as to which the record is silent, and error must be
affirmatively shown.” (Denham v. Superior Court (1970) 2 Cal.3d 557, 564, italics
omitted.) “It is well settled, of course, that a party challenging a judgment has the burden
of showing reversible error by an adequate record.” (Ballard v. Uribe (1986) 41 Cal.3d
564, 574.)
        The record produced by Anwar does not reflect that the funds he transferred into
his personal bank account, which were the funds the trial court considered to be his
“income,” were EIDL funds rather than PPP funds. His business’s balance sheet
reflected that the vast majority of the loans to his business had been PPP funds, and
Anwar produced no evidence to the contrary. Accordingly, Anwar cannot establish that
                                                  5
the trial court’s reliance on these transfers was improper, as he concedes that his PPP
loans were forgiven and could properly be considered income for child support purposes.
                                    III. DISPOSITION
       The trial court’s order is affirmed.

                                                6
                            ______________________________________
                                       Danner, J.

WE CONCUR:

____________________________________
Bamattre-Manoukian, Acting P.J.

____________________________________
Wilson, J.

H050056
Mustafa v. Lopez