California Settlement Conference Statement Living Trust by rjb15458

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									Filed 9/7/10 Marriage of Perrilliat 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                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS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
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 This opinion has not been certified for publication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

                                      SIXTH APPELLATE DISTRICT


In re the Marriage of STEWART and                                    H034379
TRACY PERRILLIAT.                                                   (Santa Clara County
                                                                     Super. Ct. No. 142822)

STEWART PERRILLIAT,

         Appellant,

         v.

TRACY PERRILLIAT,

         Respondent.



         Stewart Perrilliat ("Husband") appeals from two orders by the family court
awarding spousal and child support to his former wife, Tracy Perrilliat ("Wife").
Husband contends that the court improperly imputed income to him and thus abused its
discretion in determining the amount of support payable to Wife. He also challenges the
court's award of attorney fees to Wife. We find no error and affirm the orders.
                                                     Background
         On November 9, 2007, after 10 years and one month of marriage, the parties
                                                                                                                    1
separated. Their son was then four years old, and their daughter was one and a half.



1
 In his petition for dissolution, Husband stated that his daughter was born in April 2005,
making her two and a half. In other pleadings no birth year is stated, but Tracy's
Shortly thereafter, Wife filed a motion for child and spousal support and attorney fees. In
her supporting declaration she stated that she had primary custody of the children, that
her expenses exceeded her monthly income, and that Husband had not paid any support
since the separation. Husband filed a petition for dissolution on December 14, 2007,
requesting sole legal and physical custody of the children, with visitation to Wife.
       In his February 5, 2008 Income and Expense Declaration, Husband indicated that
he was unemployed as of December 15, 2007. He claimed an income of $3,600 for the
previous month and $36,000 for the prior year from his construction business, Perrilliat
Enterprises. An additional $40 per month was characterized as rental income. Among
his monthly expenses of $8,656.50, he listed a charitable contribution of $2,311 per
month. The accompanying "Perrilliat Enterprises 2007 Tax Data Summary" listed a
gross profit of $96,144.98, and expenses of $61,940.86. Those expenses, however,
included $27,732.00 under the category "Charitable." Husband recorded a net income
from his business of $36,204.12.
       Wife retained James Butera, CPA, to perform an analysis of Husband's income.
With the limited documents he had, Butera concluded that $6,695 was available for
support from Perrilliat Enterprises. Butera questioned the income he had determined,
however, querying, "If his business income is only $6,695 how can he afford to pay
living expenses of $8,656? He certainly has not incurred debt to pay for his living
expenses as the only debt shown on his Declaration is a loan payable to a private party
for $2,900 which was for legal fees. Clearly, we need additional records to calculate the
business income."
       On February 19, 2008, the parties appeared before the Honorable Kevin E.
McKenney, who ordered Husband to pay child support of $862 per month, effective


settlement conference statement corrects the birth date to the year 2006. The parties
agree that their daughter was not yet two when they separated.

                                             2
October 26, 2007. Judge McKenney used the figures of $6,695 as Husband's monthly
income, his 38 percent time with the children, and Wife's monthly income of $4,261.
The court also ordered child support arrears to be paid in monthly installments of $300
from March 2008 through January 2009, and $148 in February 2009. The issue of
spousal support was deferred until a long-cause hearing could be set on March 11, 2008.
       In preparation for a settlement conference on September 17, 2008, the parties filed
mandatory statements addressing child support, child support arrears, temporary spousal
support, and attorney fees. Butera had attempted to update his analysis of Husband's
income available for support in August, but he had not received most of the records he
needed for a meaningful analysis. He did note bank deposits of $394,702 during 2007.
Of that amount, $34,739 was for an account in the name of the Religious Educational
Society.
       Wife stated that Husband had paid none of the child support ordered by the court,
although she was the primary provider for the children and her expenses exceeded her
income. Husband opposed Wife's request for support and attorney fees, claiming an
inability to pay support and instead requesting support from her. His revised Income and
Expense Declaration of September 2008 reflected zero business income and $650 per
                        2
month in rental income. The expenses he listed totaled $370 per month. His personal
property, valued in his February declaration at $50,000, was now represented to be worth
           3
$80,000.
       In December 2008 Husband moved to modify child support. His newest Income
and Expense Declaration stated that he received rental income of $578 per month and had



2
   Although Husband listed it as trust income, both parties characterize this amount as
rental property income.
3
  Husband most likely was referring to real, not personal property, a house in Virginia
that he had owned before the parties married.

                                            3
no assets other than $50 in the bank. Husband stated that he was not employed, and that
his mother was loaning him money every month until he found a job. Husband attached
a revised Profit and Loss statement for 2007, showing a net profit of $44,950 from
Perrilliat Enterprises. Husband had been granted 50/50 joint custody on November 14,
2008.
        In opposition, Wife asserted that Husband had misstated his income. He had
failed to supply any data that had been requested by her attorney, and his claims were not
credible. Wife noted discrepancies in the two Profit and Loss statements and the three
Income and Expense Declarations, which, she believed, demonstrated manipulations to
reflect a lower income. Wife asked the court to rely on Butera's calculation for 2007 and
assume 2007 income of $125,734. For 2008 she pointed out that Husband had reported
expenses of $8,656. Since August 2008 he had been living with his brother free of
charge; he had an additional option of living in his mother's Oakland home in separate
living quarters. Wife suggested using the expense figure of $8,656 as the basis for
imputing Husband's 2008 income. Her own gross monthly income of $4,200 was
reflected in her salary as an intern program manager for CityTeam Ministries. Her
expenses were $4,570 per month, and she owed $26,000 for credit card debt and income
taxes, along with $17,000 still owed to her attorney after paying the attorney $25,000
from an inheritance.
        On January 22, 2009, Commissioner John Schroeder issued a "Seek Work Order"
to Husband and continued the matter of child support to April 20, 2009. On that April
hearing date, the court was advised that Husband had begun working for $2,427 per
month, and that he was living rent free in Oakland, with a room for each child. The
commissioner ordered Wife to pay Husband child support of $277 per month, offset by
Husband's arrears of an estimated $15,410.76. The commissioner informed the parties
that the entire matter was deferred pending the outcome of the hearing on spousal support
in Judge McKenney's department.

                                            4
        Judge McKenney heard the issues of spousal support and attorney fees on
February 5, 2009, and filed his order on May 6, 2009. In preparation for the February
hearing, Husband submitted another Income and Expense Declaration stating that he
received $585 in rental income and had monthly expenses of $1,653, of which $1,353
was being paid by others. He also listed an asset of $62,000 in real property and debts of
more than $66,000. Husband had not obtained employment by the hearing date; he
attributed his low income to "the economy and suspension of contracting license." The
parties appeared in pro per at this hearing and those to follow on April 20 and June 15,
2009.
        Judge McKenney filed his order on spousal support and attorney fees on May 6,
2009. He summarized the documentary and testimonial evidence he had received at the
February 5 hearing. He noted that Husband had filed untimely exhibits-- to Wife's
disadvantage, as she had not had an opportunity to review them before the hearing.
Those exhibits were not helpful to Husband in any event, and the court "had reservations
about the accuracy of what he claimed, particularly, the confusing and inconsistent
financial picture. Conversely, [Wife's] presentation was credible. Her evidence and
testimony generally supported her position."
        Applying the factors listed in Family Code section 4320, the court noted that this
was a marriage of long duration, that Wife had delayed her educational and career goals
to enable Husband to earn his Bachelor's Degree, and that she had continued to work "at
the highest level of her marketable skills in this economy." The court expressed doubt
regarding Husband's representation that he had no earnings and credited Wife's estimate
of Husband's earning capacity. Taking into account Husband's rent-producing home in
Virginia, the significant debt of both parties, and Husband's "relatively high" standard of
living, the court imputed income to him of $8,656, the amount Husband had claimed for
expenses in February 2008. The court accordingly ordered Husband to pay $500 a month



                                               5
in temporary spousal support, retroactive to October 18, 2007, until the review date of
May 5, 2010. Wife was awarded $20,000 for her attorney fees.
        Commissioner Schroeder again took up the issue of child support on June 15,
2009. Husband advised the court that he had been working since March 17, and he
provided a pay stub for May. Commissioner Schroeder, however, stated that he would
use Judge McKenney's figure of $8,656 to calculate child support. When Husband
protested that he was not licensed to do construction work anymore, the commissioner
said he was "bound to the same order." The commissioner noted that Judge McKenney
had found Wife credible and Husband not credible. He told Husband that the May 6
ruling was "[o]ne of the most scathing opinions that I have ever read. Judge McKenney
was very frustrated with the evidence that you produced because he found it totally
incredible, he didn't believe a word you said. That gives me pause to reflect on my
previous finding because I based my previous support order on what I thought was his
income, unaware that this man was such a charlatan, apparently." Using the imputed
income figure of $8,656, Commissioner Schroeder struck his prior order and calculated
child support from Husband to Wife to be $566 per month, effective April 1, 2009, along
with a $34 monthly payment toward arrears beginning June 1.
                                         Discussion
1. Support Orders
        Husband appealed from both May 6 and June 15 support orders. Both, he argues,
were based on the erroneous imputation of income and therefore constitute an abuse of
discretion. He also challenges Judge McKenney's award of attorney fees to Wife in the
May 6 order. We find no abuse of discretion.
                                   4
        Family Code section 4320 lists the factors the court must consider in determining
the extent to which a party should receive spousal support. The family court, of course,

4
    All further statutory references are to the Family Code.

                                              6
has broad discretion to balance the applicable factors in each case, and its factual findings
will not be overturned unless there is no substantial evidence to support them. " 'A trial
court's exercise of discretion will not be disturbed on appeal unless, as a matter of law, an
abuse of discretion is shown-- i.e., where, considering all the relevant circumstances, the
court has "exceeded the bounds of reason" or it can "fairly be said" that no judge would
reasonably make the same order under the same circumstances.' " (In re Marriage of
Smith (1990) 225 Cal.App.3d 469, 480.)
       Earning capacity, a key factor in the determination of both spousal and child
support, " 'represents the income the spouse is reasonably capable of earning based upon
the spouse's age, health, education, marketable skills, employment history, and the
availability of employment opportunities.' " (In re Marriage of Cheriton (2001) 92
Cal.App.4th 269, 301, quoting In re Marriage of Simpson (1992) 4 Cal.4th 225, 234.)
"To rely on earning capacity in lieu of actual income '[t]he dispositive question is
whether the evidence will sustain the inference that the party charged with support could,
with reasonable effort, obtain employment generating the postulated (higher) income.' "
(In re Marriage of Cohn (1998) 65 Cal.App.4th 923, 930.)
       Husband does not contend that the court failed to apply the mandatory factors;
indeed, in his appellate brief he does not mention either section 4320 or the statutes
governing child support. The focus of his position on appeal is the court's decision to
impute $8,656 in income to him. Husband points to his testimony at the February 5
hearing before Judge McKenney, in which he stated that his contractor's license had been
suspended and he therefore could not resume his work in construction. Besides, he told
the court, banks were not lending money for new construction or remodeling. Husband
represented that he had applied for jobs in other fields, but he could find nothing.
       The court, however, did not believe Husband. The court had received
documentary evidence based on Butera's assessment of Husband's financial picture,
which was difficult to complete in detail because of the records Butera had requested but

                                             7
not received. Using the 2007 Profit and Loss Statement the court stated that at the end of
the year Husband's business had generated $359,963, but his net income was $36,305.
He had made deposits of $34,738.59 to the Religious Educational Society, which was
only a separate bank account he had used to obtain a charitable deduction. His property
in Virginia had ostensibly varied in value, according to his Income and Expense
Declarations; in February 2008 it was worth $50,000 and produced rent of $40; by
September 2008 it was worth $80,000 and commanded rent of $650; and in February
2009 it was worth $62,000 and earned $585 in rent. Husband owned three vehicles and
had contributed nearly $28,000 to various Christian organizations in 2007. Even if the
amounts on the 2007 Income and Expense Declaration were overstated, as Husband
                        5
asserted at the hearing, the court nonetheless found that he was capable of earning
$8,656 per month, or $103,872 per year, based on his history of earnings. The court
found it "baffling" that Husband had been unable to earn anything since December 2007
"in spite of his college degree, contractor's license, relative youth of 43 years, and
obvious intelligence." The court noted an e-mail exchange between the parties in May
2008 in which Wife had requested a one-time alteration of that week's custody
arrangement. Husband declined, explaining, "I work my schedule . . . around the regular
days that I know that I am to have the children. I schedule my bids and meetings around
the days that I do not have them. My schedule has to be set up months in advance due to
the fact of the nature of my job." Notwithstanding Husband's claim that his license had
been suspended since August of 2008, the court inferred that Husband might actually
                                     6
have been working as a contractor.


5
  Husband claimed that he listed his expenses for only one month of 2007, the month he
had contributed $2,311 to charity. Although he had counsel and the form called for
average monthly expenses, he said he had misunderstood it.
6
  In the May 6, 2009 order the court stated that it was "not clear" what had led to the
suspension of Husband's contractor's license. Husband had represented that it was related

                                              8
       The court further noted the relatively low amount of debt Husband had incurred,
notwithstanding his new claim of more than $65,000 in loan balances and his
unsupported assertion of $150,000 in credit card debt. If in fact he had not been
employed, then the "inescapable conclusion" of the court was that he had not made a
reasonable effort to find work; he "is certainly well qualified to earn a significant living."
       Thus, because of the "confusing and inconsistent financial picture" Husband had
created, and the lack of credibility in his testimony, the court resorted to Husband's
statement of expenses to attribute income to him. The resolution of this issue does not
appear to be arbitrary or irrational. Following settled precedent, the court based its
conclusion on Husband's age, health, education, marketable skills, employment history,
and the availability of employment opportunities. (See In re Marriage of Cheriton,
supra, 92 Cal.App.4th at p. 301.) Should Husband produce credible evidence that
discloses a change of circumstances, he will be able to work toward a modification that
accurately reflects his current income and expenses.
       The commissioner's calculation of child support does not require reversal of this
order either. Husband's assertion of error is entirely based on the premise that the court
should have relied on his earnings from his new job, not the amount determined to be his
earning capacity. The commissioner did not disregard this employment, however, as
Husband represents. At the June 15, 2009 hearing the court received evidence that
Husband had been working at High-Tech Termite Control since March 17 and currently
was working there 30 hours a week. He listened to the new evidence, examined
Husband's paystub, and asked how long he had worked for this company. The
commissioner also heard Husband's representation that he did not have a contractor's


to a lien placed on the parties' house. The court noted that an extract from the state
licensing board indicated on November 19, 2008 that Husband's license was to expire on
May 31, 2009, but was "suspended because of association with another license that failed
to comply with an outstanding civil judgment."

                                              9
license anymore. Notwithstanding this evidence, the commissioner's decision to impute
income consistently with Judge McKenney's order suggests an implied finding that
Husband was underemployed relative to his earning capacity. "When a parent decides
not to seek employment to the best of his or her ability, the court must retain discretion to
impute income-- otherwise 'one parent by a unilateral decision could eliminate his or her
own responsibility to contribute to the support of the child, causing the entire burden of
supporting the child to fall upon the [fully] employed parent.' " (In re Marriage of
LaBass & Munsee (1997) 56 Cal.App.4th 1331, 1339.) Accordingly, when a parent has
the ability and opportunity to work but is unwilling, "the court may apply the earnings
capacity standard to deter the shirking of one's family obligations." (In re Marriage of
Regnery (1989) 214 Cal.App.3d 1367, 1373.) Considering the evidence before the court
on both occasions, we cannot find a factual basis for holding that no judge could
reasonably have made the challenged orders. (Cf. In re Marriage of de Guigne (2002) 97
Cal.App.4th 1353, 1360.)
2. Attorney fees
         In the May 6, 2009 order Judge McKenney awarded Wife $20,000 for her attorney
fees. Husband contends that this was "an egregious abuse of discretion," as it created "a
tremendous financial hardship severely compromising Husband's ability to meet his most
basic living expenses and support the two small children who are in his care half of the
time."
         Section 2030 requires the family court to "ensure that each party has access to
legal representation to preserve each party's rights by ordering, if necessary based on the
income and needs assessments, one party, except a governmental entity, to pay to the
other party, or to the other party's attorney, whatever amount is reasonably necessary for
attorney's fees and for the cost of maintaining or defending the proceeding during the
pendency of the proceeding." (§ 2030, subd. (a)(1).) The determination of entitlement to
and amount of the award "shall be determined based upon, (A) the respective incomes

                                              10
and needs of the parties, and (B) any factors affecting the parties' respective abilities to
pay." (§ 2030, subd. (a)(2).)
       Husband's claim of error regarding Judge McKenney's attorney fees order is
premised entirely on the assertion that the court was forcing him to pay "a sum equivalent
to nine months of his entire gross salary," which he represents as $2,427, in comparison
                                            7
to his estimate of Wife's income of $4847. Again, however, the court made a factual
determination that Husband's available income was significantly more than the $585 per
month he claimed to be receiving from renting the Virginia property. Contrary to
Husband's assertion, there is no indication in the record that the court failed to consider
Husband's other expenses. The amount awarded was generated in large part by
Husband's uncooperative conduct during the litigation, including his attempt to obtain
sole legal and physical custody with limited visitation to Wife. The court nevertheless
                                                                8
granted Wife less than half of the $42,000 she had requested. We find no abuse of
discretion in the court's determination of what was "reasonably necessary" in light of the
surrounding circumstances, "the respective incomes and needs of the parties," and "the
parties' respective abilities to pay." (§ 2030.)




7
 The amount stated in Wife's December 2008 Income and Expense Declaration was
$4400. This was the amount used in the Commissioner's June 15, 2009 order.
8
 The court found insufficient evidence that all of the amount Wife requested was
attributable to the custody issues.

                                                11
                                 Disposition
     The orders are affirmed.




                                   ____________________________
                                   ELIA, J.


WE CONCUR:




______________________________
RUSHING, P. J.




______________________________
PREMO, J.




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