Court Opinion

ID: 4079194
Source: CourtListenerOpinion
Date Created: 2016-10-04 04:58:47.849064+00
Date Added: 2024-06-11T12:27:34.008017
License: Public Domain

IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON

In the Matter of the Marriage of
                                                   No. 74207-8-1
CAROLE HOFFMAN,                                                                        a       CO ""

                                                   DIVISION ONE
                                                                                       CD
                       Appellant,
             and                                   UNPUBLISHED OPINION
                                                                                        !
                                                                                       CO
                                                                                              ^':
ALAN LOWELL HOFFMAN,
                                                                                      <^o     :—.'...
                       Respondent.                  FILED: October 3, 2016

       Trickey, A.C.J. — Carole LaRoche, formerly known as Carole Hoffman,

moved to vacate her decree of dissolution. She claimed her former husband, Alan

Lowell Hoffman, fraudulently misled her and the court about the status of a
multimillion dollar trust that resulted in its exclusion from the trial court's division of

property. Because LaRoche has failed to establish that the court entered the
decree as a result of fraud, misrepresentation, or other misconduct, we affirm.

                                         FACTS

       Carole LaRoche and Alan Hoffman married in 2000.                Both parties had

children from previous marriages and came to the relationship with the expectation
of significant separate assets. At the time they were married, Hoffman was the
beneficiary ofseveral multimillion dollar family trusts, while LaRoche anticipated a
$600,000 recovery from a pending lawsuit. The parties executed a prenuptial
agreement that protected these monies as each's separate property.
No. 74207-8-1 / 2

       The parties separated on March 20, 2009, and LaRoche filed for dissolution.

After an acrimonious trial, the court upheld the prenuptial agreement and

distributed the parties' separate and community property. Hoffman was awarded

the parties' real property, which included the Redmond home and the Sun Valley

home, stock, individual retirement accounts (IRAs), investment accounts, trust

accounts, and 40 percent of the community portion of the retirement accounts.

LaRoche received 50 percent of the value of the Redmond home, reimbursement

for increase in value of the Woodinville Home sold during the marriage,

compensation for her labor in preparing the Woodinville home for sale, 60 percent

of retirement accounts, tax refund, and IRA accounts. On October 8, 2010, the

trial court entered a decree of dissolution reflecting this allocation.

       Of particular interest to both parties was the Smith Barney Investment

Account titled, "'Dr. Alan Hoffman and Carole Mawson TTEE Hoffman Family Trust

DTD 1/1/06' (acct. ending in #5177) with a 4/30/2010 balance of $7,879,940" (the

5177 Trust).1 This trust account was awarded to Hoffman as his separate property,

pursuant to the prenuptial agreement.

       Both parties appealed the decree.        Hoffman assigned error to the trial

court's characterization and value of community property, while LaRoche

challenged the validity of the prenuptial agreement as substantively and

procedurally unfair. We concluded that there was no unfairness and affirmed the

validity of the prenuptial agreement.

 Clerk's Papers (CP) at 214.
No. 74207-8-1 / 3

       On August 7, 2015,2 LaRoche moved to vacate the decree and reopen the

property division portion of the dissolution. She submitted a declaration in support

of her motion, accusing Hoffman and his attorneys of misleading her and the court

as to his interest in the family trust. She declared that fraudulent evidence had

been submitted at trial, including false financial declarations, certified public

accountant (CPA) witness reports, a flowchart showing the tracing of accounts that

omitted relevant portions, and testimony about the trust being for his children and

not part of the property subject to distribution.

       The basis of LaRoche's fraud claim is her contention that Hoffman

represented that the 5177 Trust was not his property. At trial, Hoffman testified

that he was under the impression that the trust was for his children and

grandchildren. According to LaRoche, the trial court therefore did not include it in

its distribution of property. She claims that Hoffman had actually appointed the

trust to his own estate three years earlier and concealed that fact from her and

from the trial court.

       At the hearing on her motion to vacate, LaRoche argued that Hoffman's

attorneys submitted two fraudulent financial declarations. According to her, the

declarations did not list the correct amount of Hoffman's income or interest earned

and that the real number is "quite a bit more, like many times more than what he

2 Earlier in 2015, LaRoche filed a lawsuit in the Western District of Washington, cause No.
2:15-CV-01003-RAJ, against Hoffman, and the attorneys, expert and fact witnesses
involved in the dissolution, the appeal, and a malpractice action she filed against one of
her attorneys.   In her amended complaint, she alleges claims for civil conspiracy,
conversion, negligence, and fraud.
No. 74207-8-1/4

claimed."3 She argued that Hoffman misrepresented the value of the trust and

falsely claimed that everything belonged to his children, even though he had

transferred it to his own estate. LaRoche claimed that the CPA witness reports

were fraudulent, and that even if the accounts were Hoffman's separate property

originally, they had been commingled. She also "discovered . . . last year" that

Hoffman's counsel had submitted an incomplete exhibit designed to mislead both

her and the court.4

       The trial court found no basis to undo the judgment and findings, and that it

"certainly d[id]n't see something by Dr. Hoffman, the respondent, or his attorney,

Mr. Eagle, that was false, intended to mislead the court, intended to mislead you."5
The trial court further found "no substantial facts warranting vacation of judgment

under CR 60" and that "there was no fraud perpetuated by Dr. Hoffman or his

representatives at time of trial."6 LaRoche appeals.

                                      ANALYSIS

       LaRoche argues that the trial court erred when it denied her motion to

vacate the dissolution decree under CR 60(b)(4), because she presented evidence

establishing that Hoffman committed fraud, misrepresentation, and misconduct

when he characterized his assets to the trial court.7 According to her, Hoffman

deceived the court by testifying that the 5177 Trust was for his children, when he

3 Report of Proceedings (RP) (Oct. 9, 2015) at 6.
4 RP at 22.
5RPat21.
6 CP at 358.
7 In her motion, LaRoche argued that Hoffman and his attorneys submitted fraudulent
evidence of Hoffman's income and value of the assets. She appears to have abandoned
those arguments on appeal.
No. 74207-8-1 / 5

had actually appointed the trust to his own estate three years earlier. She argues

that she relied on and was misled by Hoffman's misrepresentation, which

prevented her from presenting accurate proposed orders and arguing for a

disposition that took the multimillion dollar trust into account.   Based on this

assumption, LaRoche also argues that the trial court should have determined that

she and Hoffman held the 5177 Trust as tenants in common.

      Whether to grant a CR 60 motion to vacate is within the trial court's sound

discretion. Martin v. Pickering, 85 Wn.2d 241, 245, 533 P.2d 380 (1975); In re

Marriage of Knutson, 114 Wn. App. 866, 871, 60 P.3d 681 (2003). A trial court

manifestly abuses its discretion if its decision is based on untenable grounds or

untenable reasons. In re Marriage of Littlefield, 133 Wn.2d 39, 46-47, 940 P.2d

1362(1997).

          Under CR 60(b)(4), a trial court may vacate a judgment procured by fraud,

misrepresentation, or misconduct. "The party attacking a judgment under CR

60(b)(4) must establish the fraud, misrepresentation, or other misconduct by clear

and convincing evidence." Lindgren v. Lindgren, 58 Wn. App. 588, 596, 794 P.2d

526 (1990). The focus of CR 60(b)(4) is on judgments that were unfairly obtained,

not those that may have been premised on incorrect facts. Peoples State Bank v.

Hickev, 55 Wn. App. 367, 371-72, 777 P.2d 1056 (1989). For this reason, the

conduct must cause the entry of the judgment such that the losing party was

prevented from fully and fairly presenting its case or defense. Hickev, 55 Wn. App.

at 372.
No. 74207-8-1 / 6

      There is no indication in the record that the trial court entered the decree as

a result of fraud, misrepresentation, or misconduct by one of LaRoche's

adversaries.   The trial court awarded Hoffman the 5177 Trust as his separate

property based on the terms of the prenuptial agreement, not because he

convinced the court that it was not part of his estate. Therefore, the record does

not support vacating the judgment on the grounds that it was procured by fraud,

misrepresentation, or other misconduct.

       LaRoche next argues that under CR 60(e)(2), the trial court should have

held an evidentiary hearing. She contends that the affidavits and declarations she

submitted are sufficient to raise a factual          issue with regard to fraud,

misrepresentation, or other misconduct. CR 60(e)(2) states:

       Upon the filing of the motion and affidavit, the court shall enter an
       order fixing the time and place of the hearing thereof and directing
       all parties to the action or proceeding who may be affected thereby
       to appear and show cause why the relief asked for should not be
       granted.

Oral testimony, however, is not the rule and is up to the trial court's discretion. In

re Marriage of Irwin, 64 Wn. App. 38, 61, 822 P.2d 797 (1992).

       LaRoche argues she raised an issue of fact that cannot be resolved without

the taking of testimony, citing In re Marriage of Maddix, 41 Wn. App. 248, 252, 703

P.2d 1062 (1985). In that case, the parties submitted conflicting affidavits disputing

the value of the husband's business but the trial court entered a final decree

without further investigation. Maddix. 41 Wn. App. at 249. Later, the wife moved

to vacate the dissolution decree, alleging fraud, misrepresentation, or other

misconduct under CR 60(b)(4). Maddix. 41 Wn. App. at 249. The trial court made

                                          6
No. 74207-8-1 / 7

no finding of fraud but found that the husband had failed to disclose the value of

his business. Maddix. 41 Wn. App. at 249-50. On that basis it set aside the decree

and set for trial the sole issue of the business's value. Maddix. 41 Wn. App. at

250. On appeal, we reversed and remanded, finding that the trial court erred by

vacating the decree without first hearing and weighing testimony regarding fraud,

misrepresentation, or other misconduct. Maddix, 41 Wn. App. at 252.

       Here, LaRoche has not submitted sufficient facts to meet her burden of

showing fraud, misrepresentation, or other misconduct. She claims that Hoffman

misrepresented the status of the 5177 Trust and therefore prevented the trial court

from including it in the distribution of property. Again, the record shows that the

5177 Trust was determined to be Hoffman's separate property under the prenuptial

agreement, not based on any representation made at trial.

       Hoffman requests that the court assign "financial penalties" to LaRoche, "at

least equal to the $4500 in legal fees" that the trial court declined to award,

presumably for filing a frivolous appeal and to deter her from further litigation.8

Under RAP 18.9, an appellate court may order a party who files a frivolous appeal

to pay terms or compensatory damages to any other party for having to defend

against the appeal. "An appeal is frivolous if the appellate court is convinced that

the appeal presents no debatable issues upon which reasonable minds could differ

and is so lacking in merit that there is no possibility of reversal." In re Marriage of

Foley. 84 Wn. App. 839, 847, 930 P.2d 929 (1997).

 Resp't's Br. at 10.
No. 74207-8-1 / 8

      While the merit of LaRoche's appeal is certainly questionable, Hoffman's

request does not fall within the scope of RAP 18.9. He essentially asks this court

to compensate him for expenses he incurred at trial, not on appeal, and failed to

recover from the trial court. We decline to award attorney fees under RAP 18.9.

      Affirmed.

                                                                ^[7

WE CONCUR:

 JULa*4M^.    J.

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