Filed 6/12/20 Gill v. Turlock Air Park CA5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

FIFTH APPELLATE DISTRICT

RITA GILL et al.,

Plaintiffs and Respondents,

v.

TURLOCK AIR PARK, INC. et al.,

Defendants and Appellants.

F079383

(Super. Ct. No. 2200435)

OPINION

APPEAL from a judgment of the Superior Court of Stanislaus County. Timothy W. Salter, Judge.

Fores.Macko.Johnston, Inc. and Anthony D. Johnston for Defendants and Appellants.

Cyril Lawrence, Inc. and Cyril L. Lawrence for Plaintiffs and Respondents.

-ooOoo-

In proceedings under Probate Code section 850 in the matter of the estate of Gurmukh Gill, the trial court not only determined the estate’s rightful ownership of an interest in a closely held corporation known as Turlock Air Park, Inc. (TAP), but also granted further relief that to some extent related to the internal corporate affairs of TAP. The judgment included, among other things, remedies for breaches of fiduciary duty committed by TAP’s directors and an order to distribute some of TAP’s assets to the estate. TAP and one of its directors, John Souza (together appellants), appeal from the judgment on the ground the trial court lacked subject matter jurisdiction to reach corporate issues that allegedly required a derivative action and/or a statutory proceeding to dissolve the corporation. Rita Gill and Kulwant Sahota, as the executors of the estate of Gurmukh Gill (respondents or the estate), argue the trial court had subject matter jurisdiction over the entire controversy before it, and moreover, to the extent there were any deficiencies in the process used by the trial court to grant complete relief they were merely errors in excess of jurisdiction which are subject to waiver or forfeiture. Furthermore, respondents insist that any such error or errors in this case were clearly forfeited by appellants due to their failure to object in the trial court. Based on our review of the record and applicable legal principles, we conclude that respondents’ position is correct. Accordingly, we reject appellants’ main contention on appeal that the trial court lacked subject matter jurisdiction. We also reject appellants’ further contention that the statutory penalty under section 859 was inapplicable. However, we find the trial court erred in its calculation of the amount of the penalty, and we have corrected that calculation error in our disposition. In all other respects, the judgment of the trial court is affirmed.

FACTS AND PROCEDURAL HISTORY

Background of TAP and the Estate’s Interest Therein

TAP is a closely held corporation that owned and operated a small airfield in Turlock, California. Although the airfield was TAP’s primary business activity, it also owned and managed an adjoining 60-acre farm plus several homes located thereon and leased a small portion of the land for a propane tank site. TAP was founded shortly after World War II by John Souza, Sr. and Zelda Souza as a sole proprietorship and was incorporated in 1979. John, Sr. and Zelda died in 2002 and 1979, respectively, and their four children (John Souza, Lawrence Souza, Elaine Wilson and MaryAnn Gill) inherited the ownership of TAP and were appointed as its directors and officers. From 2002 to 2015, the surviving siblings continued to operate and manage the airfield business and adjoining properties through TAP.

MaryAnn died in 2011. She left the residue of her estate, including her one-fourth interest in TAP, to her husband, Gurmukh Gill.

On July 6, 2015, TAP sold all of its real property for $3.5 million. After commissions and costs, TAP received $2,323,301 in cash, plus a $1 million promissory note from the purchaser. The goal in selling the real property was apparently to wind up the corporate business and distribute the proceeds to the shareholders when feasible; but as will be seen, that goal never came to fruition.

On July 8, 2015, Elaine wrote three separate checks from TAP’s account, each in the amount of $580,826: one to herself, one to John and one to Gurmukh Gill. However, approximately one month later, John asked everyone to return the money. Gurmukh Gill returned $580,000, Elaine having paid off her mortgage was able to return only $250,000, and John returned the entire $580,826 to TAP. The ostensible reason for requesting the return of the money and delaying the expected winding up of TAP was uncertainty relating to Lawrence’s bankruptcy, which as noted below was filed shortly before the sale of the property.

In April of 2015, Lawrence and his wife filed a personal bankruptcy under Chapter 11 of the Bankruptcy Code. This resulted in negotiations with the bankruptcy attorney to have Lawrence’s shares returned to TAP in exchange for a payment to the bankruptcy trustee of an agreed sum for the same. Pursuant to a settlement reached in April of 2016 and ratified by TAP in July of that year, the bankruptcy trustee received $450,000 from TAP plus a release of debts owed by Lawrence to TAP in exchange for his interest in TAP, with Lawrence’s shares being returned to TAP. After the settlement was carried out, there were only the three remaining shareholders, John, Elaine and Gurmukh Gill; that is, Gurmukh Gill had a one-third interest in TAP.

Gurmukh Gill died on December 12, 2015. In his will, he named his wife, Rita Gill, and his sister, Kulwant Sahota, as the executors of his estate. His will was admitted to probate in the court below and letters were issued.

Payments to Directors

On July 2, 2016, John and Elaine as the remaining directors of TAP executed a resolution that they would not fill the vacant seat(s) on the board of directors; but rather, TAP would be operated by the two remaining directors, namely, John and Elaine. On the same day, John and Elaine executed a resolution approving “retroactive” compensation to themselves, consisting of “payment of $36,000.00 to each Elaine Wilson and John Souza for the previous 18 months ending December 31, 2015, and $12,000 to each for the period January 1, 2016 to June 31, 2016.”

On July 21, 2016, John sent an email to Elaine attaching a draft of a proposed action by written consent of the directors and shareholders for the dissolution of TAP and the distribution of TAP’s assets to the shareholders. On July 28, 2016, John sent an email with an attached “Action by Written Consent of Directors and Stockholders to Distribute and Dissolve 7/28/16,” and added in the email to “execute and return ASAP.” Despite these initial steps, the proposed action to dissolve TAP and distribute its assets was not carried out.

On September 6, 2016, John sent each shareholder TAP’s 2015 tax return and shareholder’s K-1. The estate, as one-third shareholder, was required to report $298,000 of TAP’s gain from the real property sale. As a result, the estate paid $116,000 in taxes. On October 13, 2016, respondents requested on behalf of the estate that John advance TAP funds to help cover the estate’s share of the income tax burden from the real property sale. John responded that “there have been no authorized distributions” due to “conflicting claims on TAP’s funds.” John gave no explanation of the nature of the conflicting claims.

On December 2, 2016, John prepared and sent two resolutions to Elaine, one to dissolve TAP, and another that stated: “[T]he board acknowledges Elaine Wilson and John Souza have only received compensation for their efforts through September. The Directors hereby approve compensation to them for October and future months until the corporation is dissolved.” The resolution granted John and Elaine $8,000 each for July 1, 2016 through October 2016, and $2,000 per month until TAP dissolves.

On December 12, 2016, an attorney retained to represent TAP (Timothy Silverman) filed creditor claims in the estate alleging that John and Elaine owned Gurmukh Gill’s TAP shares. On January 9, 2017, the estate rejected the creditor’s claim. On February 21, 2017, attorney Silverman filed a first amended complaint for constructive trust continuing to challenge the estate’s ownership of the TAP shares.

On December 16, 2016, the resolution to dissolve TAP was signed, with the corporation set to cease operations on December 31, 2016. On December 29, 2016, the final paperwork for the dissolution was sent to Elaine, including a corporate certification to wind up and dissolve. Elaine responded, “I will be able to deliver these documents to the Secretary of State this morning once I receive your Approval.” John replied: “Per Attorney’s advice we are not going to file the dissolution papers at this time.” The email goes on to state: “So tear up the documents … Delete the 12/16/16 Action by Written Consent. TAP will continue to operate into next year and will incur additional expenses, fees and taxes which will reduce the net to be eventually distributed.”

A 2016 spreadsheet of TAP’s bank account showed large sums of money being paid from TAP’s bank account to John and Elaine between July and December of 2016. On September 14, 2017, John and Elaine ratified all past payments to themselves and approved continuing monthly director fees of $2,000 per month.

Petition filed under Section 850

In late 2016, respondents as executors of the estate of Gurmukh Gill filed a petition in the trial court under section 850 (the petition). According to the petition, John Souza, as one of TAP’s directors, had called into question the validity of the estate’s interest as a shareholder of TAP. The petition requested an order confirming the estate’s ownership interest in TAP, but also sought other forms of relief, including an accounting and an order distributing to the estate its one-third share of TAP’s assets.

The trial brief filed in support of the petition argued that after the sale of TAP’s property, John and Elaine realized they could use their control over TAP, as directors and majority shareholders, to financially enrich themselves while greatly diminishing the value of the estate’s interest in TAP. This conduct assertedly constituted breach of fiduciary duty and bad faith, and thus penalties under section 859 were sought. John and Elaine filed an opposing trial brief, apparently arguing the directors were permitted to receive the purported payments as compensation and did not act in bad faith or violate a fiduciary duty to TAP or to the estate.

Statement of Decision and Judgment

The matter proceeded to trial on April 24–25, 2018. At the close of trial, the trial court took the matter under submission. On June 15, 2018, the trial court issued its statement of decision. On the issue of the estate’s interest in TAP, the trial court confirmed that the estate was the owner of the shares previously owned by MaryAnn and had a one-third interest in TAP. The trial court next considered the claims by the estate that John and Elaine had committed acts to diminish the value of the estate’s one-third share in TAP by making improper payments to themselves and committing other alleged breaches of fiduciary duties as directors and controlling shareholders. After considering all the evidence presented at trial, the trial court concluded that John and Elaine breached their fiduciary duty to TAP by (1) granting themselves retroactive pay increases, which were essentially gifts to themselves of corporate funds, (2) paying themselves unreasonable consulting fees, management fees and accounting fees after June 20, 2015, which were also gifts to themselves of corporate assets, and (3) in paying their personal attorney fees with money from TAP. As a result of this conduct, the amount John had improperly received from TAP was $68,000; the amount Elaine had improperly received from TAP was $60,000; and the amount of funds improperly used to pay their personal attorney fees was $64,645.

Not only were these sums ordered restored to TAP, but the trial court also determined that the amounts improperly paid to John and Elaine were taken by them in bad faith to the detriment of the estate. Consequently, the trial court concluded that, pursuant to section 859, John was required to pay the estate $136,000 and Elaine was required to pay to the estate $120,000. Under the double liability penalty provision of section 859, these sums were double the amounts of improper compensation that John and Elaine had paid to themselves from TAP’s bank account.

The trial court also concluded from the evidence at trial that the net valuation of the estate’s one-third share, as of March 31, 2018, was the sum of $959,821.95. The trial court held: “This is the amount that TAP is ordered to distribute to the Estate of Gill.”

On March 20, 2019, a corrected judgment was entered by the trial court. TAP and John thereafter filed a notice of appeal from the judgment.

DISCUSSION

I. Jurisdictional Principles and Standard of Review

Appellants’ appeal principally argues the trial court lacked subject matter jurisdiction over issues relating to TAP’s internal corporate affairs.

Jurisdiction of the subject matter is sometimes referred to as jurisdiction in the fundamental or strict sense (Abelleira v. District Court of Appeal (1941) 17 Cal.2d 280, 288 (Abelleira); 2 Witkin, Cal. Procedure (5th ed. 2008) Jurisdiction, § 11, p. 584), and involves the power of the court to hear or determine the case (In re Griffin (1967) 67 Cal.2d 343, 346). “ ‘ “The principle of ‘subject matter jurisdiction’ relates to the inherent authority of the court involved to deal with the case or matter before it.” [Citation.]’ ” (Barry v. State Bar of California (2017) 2 Cal.5th 318, 324.) Without subject matter jurisdiction, there is an entire absence of power to hear or determine the case, and any judgment or order entered by a court lacking this fundamental jurisdiction is void on its face. (Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180, 196; Abelleira, supra, 17 Cal.2d at p. 288.)

Other types of error are distinguishable even though the terminology of lack of jurisdiction is sometimes used. Thus, where jurisdiction of the subject matter and the parties exist in the fundamental sense, but the court fails to act in accordance with statutorily prescribed procedures or prerequisites or acts beyond or contrary to the authority so conferred, the court’s actions are merely “in excess of jurisdiction.” (People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653, 661.) Since errors in excess of jurisdiction do not involve the court’s fundamental jurisdiction, they are subject to waiver or forfeiture. (People v. Mower (2002) 28 Cal.4th 457, 474, fn. 6; People v. Ruiz (1990) 217 Cal.App.3d 574, 584.)

Where, as here, the relevant facts are not in dispute, the issue of subject matter jurisdiction is a legal question subject to de novo review. (Guardianship of Ariana K. (2004) 120 Cal.App.4th 690, 701.)

II. The Trial Court Did Not Lack Subject Matter Jurisdiction

Appellants acknowledge the trial court had authority under section 850 to declare the estate’s ownership interest in TAP, but argue the court lacked subject matter jurisdiction to grant the further relief relating to corporate issues—that is, relief relating to the actions of TAP’s directors and the order that the estate be paid a one-third distribution of TAP’s assets. As explained below, we disagree with appellants’ premise that the trial court’s resolution of the entire controversy before it somehow transgressed the bounds of its subject matter jurisdiction.

It is clear that respondents appropriately sought relief in the probate proceedings for the estate pursuant to section 850. Section 850 provides a mechanism for a court determination of rights in property claimed to belong to a decedent or another person. (Estate of Young (2008) 160 Cal.App.4th 62, 75.) Section 850 states, in relevant part, that a personal representative or other interested person is entitled to file a petition requesting the court to “make an order under this part” in certain cases, including (1) “Where the decedent died in possession of, or holding title to, real or personal property, and the property or some interest therein is claimed to belong to another;” and (2) “Where the decedent died having a claim to real or personal property, title to or possession of which is held by another.” (§ 850, subd. (a)(2)(C) & (D).) Here, it is undisputed that respondents properly sought to confirm the estate’s ownership interest in TAP under section 850 where that ownership had been called into question by appellants.

Moreover, when a section 850 petition is made, other related claims may also be asserted or joined with it. Section 855 states: “An action brought under this part may include claims, causes of action, or matters that are normally raised in a civil action to the extent that the matters are related factually to the subject matter of a petition filed under this part.” One evident purpose for this provision is to facilitate the resolution by the trial court of the entire controversy, which has long been recognized as appropriate in probate proceedings. (See, e.g., Estate of Baglione (1966) 65 Cal.2d 192, 197 [in the exercise of its legal and equitable powers over one aspect of a claim, the probate court may resolve all aspects of the claim and determine the whole controversy between the parties before it].) Further, section 856 authorizes the trial court to require a transfer or conveyance of the property in question and/or to grant other appropriate relief: “[I]f the court is satisfied that a conveyance, transfer, or other order should be made, the court shall make an order authorizing and directing the personal representative or other fiduciary, or the person having title to or possession of the property, to execute a conveyance or transfer to the person entitled thereto, or granting other appropriate relief.” (§ 856.) The breadth and flexibility of this statutory scheme should be apparent from the above provisions. As other appellate cases have noted, the scope of the statutory scheme includes determining rights to property claimed by a personal representative of a decedent or other persons, effecting a conveyance or transfer thereof, granting any appropriate relief to further such objectives, and preventing the looting of estates. (Dudek v. Dudek (2019) 34 Cal.App.5th 154, 170–171; Estate of Kraus (2010) 184 Cal.App.4th 103, 113–114, 117–118.) And, as noted, such relief would include determining the related civil claims or matters asserted in connection with the section 850 petition. (§ 855.)

In the present case, respondents’ claims of breach of fiduciary duty appear to have been factually related to the section 850 request to confirm the estate’s one-third ownership; that is, both involved appellants’ conduct relevant to the estate’s shareholder interest, either in terms of the rightful ownership thereof or its value. As respondents put it, they were “seeking not only confirmation of the estate’s TAP ownership, but also equal treatment from TAP with respect to its distributions” under circumstances where it was clear that TAP had ceased its business operations and was poised to dissolve and distribute its remaining funds. When the trial court restored the corporate funds taken in breach of appellants’ fiduciary duty and then valued the estate’s one-third share of TAP, and further ordered that said one-third share be transferred to the estate, it was arguably acting within the scope of the above statutory provisions. (See Estate of Kraus, supra, 184 Cal.App.4th at p. 117 [noting that the probate court is charged with marshalling, protecting and properly distributing property claimed to belong to a decedent, and that section 850 et seq. “are intended to aid in that endeavor”].)

But even apart from the trial court’s ability to hear and resolve related claims in conjunction with the section 850 petition, we believe that appellants’ argument that the trial court lacked subject matter jurisdiction is without merit because it fails to account for the court’s broad inherent authority. Appellants are apparently under the impression that when a trial court hears a probate case or petition, the court’s fundamental subject matter jurisdiction becomes constricted, limited or curtailed. But that is not so. The superior court, even when it hears probate matters, is still the superior court—a court of general jurisdiction. (§ 800 [so stating]; see § 7050 [superior court has jurisdiction over probate matters].) Although a superior court may for convenience or efficiency be divided into departments, including a probate department, the subject matter jurisdiction of the superior court is vested as a whole. (Estate of Bowles (2008) 169 Cal.App.4th 684, 695.) Section 800 plainly states: “The court in proceedings under this code is a court of general jurisdiction and the court, or a judge of the court, has the same power and authority with respect to the proceedings as otherwise provided by law for a superior court, or a judge of the superior court, including, but not limited to, the matters authorized by [s]ection 128 of the Code of Civil Procedure.” As a court of general jurisdiction, it can exercise its legal and equitable powers to fashion remedies and grant appropriate relief. (Estate of Kraus, supra, 184 Cal.App.4th 103, 114.)

These principles are aptly summarized by the Court of Appeal in Estate of Kraus, supra, 184 Cal.App.4th 103, 113–114, as follows:

“Section 856 clearly and unambiguously grants the probate court the power not only to order the conveyance or transfer to the person entitled to the property in question, but also to grant other appropriate relief. Even apart from the statutory authority, the probate court is a court of general jurisdiction [citations] with broad equitable powers. [Citations.] The probate court has jurisdiction to determine whether property is part of the decedent’s estate or living trust. [Citations.] As the Court of Appeal discussed in Estate of Heggstad [(1993)] 16 Cal.App.4th [943] at p. 952: ‘The probate court has general subject matter jurisdiction over the decedent’s property and as such, it is empowered to resolve competing claims over the title to and distribution of the decedent’s property. [Citations.]’ [Citation.] The probate court may apply general equitable principles in fashioning remedies and granting relief. [Citations.] Our Supreme Court has held, ‘In the exercise of its legal and equitable powers [citations], a superior court sitting in probate that has jurisdiction over one aspect of a claim to certain property can determine all aspects of the claim.’ [Citation.] Our Supreme Court explained: ‘The ultimate aim and purpose of administrative proceedings … is to ascertain the persons entitled to share in the estate of the decedent and to decree distribution accordingly.…’ [Citations.] It is pointless to deny a probate court the power to determine the whole controversy between the parties before it. [Citations.]”

Applying the above principles to the present case, we readily conclude the trial court had subject matter jurisdiction to determine the entire controversy before it. In addition to determining the estate’s rightful ownership interest in one-third of the shares of TAP, other equitable relief was warranted to protect the estate’s interest. Although TAP had effectively ceased its business operations with the sale of its real property and was in a position to dissolve and distribute its remaining cash reserves, instead of doing so there was evidence its two remaining directors were using their position to siphon off corporate funds to benefit themselves to the detriment of the estate’s interest. The trial court applied equitable principles to resolve the entire controversy between the parties by finding that appellants had acted in breach of their fiduciary duties and, as a remedy, the trial court ordered the return to TAP of appellants’ improper payments to themselves. Further, and consistent with the function of a probate proceeding and with section 856, the trial court ascertained the value of the estate’s one-third interest in TAP and ordered that the estate’s one-third interest be distributed to the estate. Because the trial court, sitting in probate, was entitled to resolve the entire controversy before it, and was entitled to apply equitable principles in fashioning an appropriate remedy, we conclude the trial court’s ruling did not transgress its subject matter jurisdiction. Accordingly, appellants’ contention the trial court lacked fundamental jurisdiction over the subject matter is rejected.

III. Any Error in Excess of Jurisdiction was Forfeited by Appellants

Appellants’ argument that the trial court lacked subject matter jurisdiction is largely premised on the proposition that, in order to obtain the particular relief granted by the trial court affecting TAP as a corporation, other pleadings or procedures would have to have been initiated but were not. Specifically, appellants argue: (1) the claimed breaches of fiduciary duty were derivative in nature (see Jones v. H.F. Ahmanson & Co. (1969) 1 Cal.3d 93, 106–107) and thus could not be maintained by a shareholder (i.e., the estate) in the absence of compliance with the requirements of Corporations Code section 800, subdivision (b) (see Shields v. Singleton (1993) 15 Cal.App.4th 1611, 1618–1619 [no standing to sue in the absence of compliance with Corp. Code, § 800, subd. (b)]); and (2) the order that TAP distribute to the estate its one-third share would have required an involuntary dissolution proceeding be commenced under Corporations Code section 1800 et seq. According to appellants, since such procedures or proceedings were not followed here, and because section 850 cannot reasonably be construed as authorizing such interferences with internal corporate affairs, the trial court assertedly lacked subject matter jurisdiction. We believe appellants have, at least to some extent, mischaracterized the nature of the relief granted by the trial court. In any event, the deficiencies argued by appellants do not implicate the trial court’s fundamental subject matter jurisdiction—the presence of which was explained hereinabove—but would merely constitute errors in excess of jurisdiction, which are subject to forfeiture.

Preliminarily, we do not agree with appellants’ contention that a shareholder derivative action was necessarily required to redress the breaches of fiduciary duty committed by appellants in this case. In circumstances where controlling shareholders and/or directors of closely held corporations have used their control to pay themselves excessive compensation or other sums so as to deprive a minority shareholder of the value of his or her individual shares, the claim by the minority shareholder may be treated as personal or individual and not derivative to the corporation’s rights. (Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, 1252–1260, foll. Jones v. H.F. Ahmanson & Co., supra, 1 Cal.3d at pp. 107–108; see also Smith v. Tele-Communication, Inc. (1982) 134 Cal.App.3d 338, 343 [where gravamen of injury is to an individual as minority shareholder, the claim is not derivative]; De Martini v. Scavenger’s Protective Assn. (1935) 3 Cal.App.2d 691, 698 [improperly calling distributions to some shareholders “wages” could not be used as a means to deprive minority shareholder of share of distributions].) Here, the trial court found that appellants’ breaches of fiduciary duty, by which they used their position of control to distribute corporate funds to themselves, created distinct injury to the estate by diluting the estate’s share while correspondingly benefitting appellants. Thus, the injury was individual, and not that of the corporation or all shareholders generally, and therefore no derivative action was necessary to allow the trial court to redress the breaches of fiduciary duty.

Appellants also assert the trial court’s order that TAP pay to the estate a distribution of one-third of the value of TAP as of March 31, 2018, was essentially an involuntary dissolution of TAP without following the procedures prescribed under the Corporations Code. (Corp. Code, §§ 1800 et seq., 2004 [an incident of dissolution process is distribution to shareholders].) A California corporation can only be dissolved in the manner and under the conditions prescribed in the Corporations Code. (Keeler v. Schulte (1957) 47 Cal.2d 801, 803.) While we would agree with appellants that some aspects of the trial court’s ruling are indicative of a dissolution proceeding (e.g., ordering a distribution by TAP of the estate’s one-third share), we would also point out that the trial court did not actually require TAP to wind up and dissolve. Rather, it is apparent the trial court was attempting to resolve the entire controversy before it under unique circumstances which included that (i) TAP had sold its real estate, had ceased to conduct business and was apparently in a position to wind up and distribute its assets to the three remaining shareholders, and (ii) appellants, as those controlling TAP, had been engaged in a pattern of diluting the estate’s minority interest by making improper corporate payments to benefit themselves. The trial court sought to remedy this situation under its equitable powers by simply having the estate be paid its one-third share.

But even assuming the trial court overstepped or acted contrary to statutory authority in making the orders it did, or even assuming necessary procedures and prerequisites for the particular relief granted by the trial court were not followed, the types of infirmities involved would merely constitute errors in excess of jurisdiction. As noted hereinabove, a lack of jurisdiction in its fundamental or strict sense means an entire absence of power over parties or subject matter. (People v. Mower, supra, 28 Cal.4th 457, 474, fn. 6; Abelleira v. District Court of Appeal, supra, 17 Cal.2d 280, 288.) However, the phrase “lack of jurisdiction” is also used in a sense that is less than fundamental. Where jurisdiction of the subject matter and the parties exists, but the court fails to act in accordance with statutorily prescribed procedures or prerequisites or acts beyond or contrary to the authority so conferred, the court’s actions are merely “in excess of jurisdiction.” (People v. American Contractors Indemnity Co., supra, 33 Cal.4th 653, 661.) A court’s action may be in excess of jurisdiction where, though it has jurisdiction in the fundamental sense, it has no “jurisdiction” or power to act except in a particular manner, or to give certain kinds of relief, or to act without the occurrence of certain procedural prerequisites. (Schwartz v. Labow (2008) 164 Cal.App.4th 417, 426, citing Abelleira v. District Court of Appeal, supra, 17 Cal.2d 280, 288.) Generally, acts which exceed the defined power of the court in any instance, whether that power be defined by express statutory declaration or rules developed by judicial precedent, are deemed to be in excess of jurisdiction. (Law Offices of Stanley J. Bell v. Shine, Browne & Diamond (1995) 36 Cal.App.4th 1011, 1022.) “ ‘ “[W]hen a statute authorizes [a] prescribed procedure, and the court acts contrary to the authority thus conferred, it has exceeded its jurisdiction.” ’ [Citation.]” (People v. American Contractors Indemnity Co., supra, 33 Cal.4th 653, 661.) The infirmities alleged by appellants in the present appeal are precisely of the nonfundamental type described above; that is, appellants are asserting that certain statutory procedures or prerequisites were not followed in regard to the relief granted by the trial court concerning internal affairs of TAP as a corporation. Clearly, the errors complained of by appellants here were simply in excess of jurisdiction, and did not involve an entire absence of jurisdiction in the fundamental sense.

As explained by the Supreme Court in People v. Mower, supra, 28 Cal.4th 457, although a lack of jurisdiction in the fundamental sense is not waived and may be raised at any time, an error by the trial court that is merely in excess of jurisdiction is subject to principles of waiver or forfeiture: “In its fundamental sense, ‘jurisdiction’ refers to a court’s power over persons and subject matter. [Citation.] Less fundamentally, ‘jurisdiction’ refers to a court’s authority to act with respect to persons and subject matter within its power. [Citation.] Issues relating to jurisdiction in its fundamental sense indeed may be raised at any time. [Citations.] By contrast, issues relating to jurisdiction in its less fundamental sense may be subject to bars including waiver (i.e., the intentional relinquishment of a known right) [citation] and forfeiture (i.e., the loss of a right through failure of timely assertion) [citation].” (People v. Mower, supra, 28 Cal.4th at p. 474, fn. 6, italics added; see also People v. Ruiz, supra, 217 Cal.App.3d at p. 584 [principles of estoppel, waiver, passage of time may be applied to errors in excess of jurisdiction]; Conservatorship of O’Connor (1996) 48 Cal.App.4th 1076, 1092; Law Offices of Stanley J. Bell v. Shine, Browne & Diamond, supra, 36 Cal.App.4th 1011, 1024–1025.)

Here, appellants made no objections in the trial court based on alleged jurisdictional concerns relating to TAP’s internal corporate affairs. Appellants could have raised such issues by objecting to the petition pretrial, objecting to the scope of issues that were being considered during the trial, or by bringing a posttrial motion. Despite these opportunities, appellants did not do so and failed to object until it filed its opening brief on appeal. We conclude that appellants forfeited the jurisdictional issue or issues, by failure to raise them in the trial court. (See Morgan v. Imperial Irrigation Dist. (2014) 223 Cal.App.4th 892, 913–914 [forfeiture on appeal of issues not raised in trial court]; San Mateo Union High School Dist. v. County of San Mateo (2013) 213 Cal.App.4th 418, 436 [noting forfeiture may be found where party had opportunity to object in the trial court, but failed to do so]; Dietz v. Meisenheimer & Herron (2009) 177 Cal.App.4th 771, 799–800 [to preserve an issue for appeal, the error must be raised in trial court]; Ochoa v. Pacific Gas & Electric Co. (1998) 61 Cal.App.4th 1480, 1488, fn. 3 [“It is axiomatic that arguments not asserted below are waived and will not be considered for the first time on appeal”].)

In conclusion, to the extent the alleged jurisdictional infirmities existed, we hold they were merely errors in excess of jurisdiction. As such, they were subject to waiver or forfeiture, and we conclude they were clearly forfeited by appellants. Accordingly, appellants’ jurisdictional arguments in this matter are to no avail.

IV. Section 859 Relief Was Proper, But Calculation Was in Error

Although appearing in appellants’ opening brief under the general heading of the jurisdictional arguments, one of appellants’ claims of error was that the trial court misapplied the clear and unambiguous terms of section 859. Section 859 states in relevant part as follows: “If a court finds that a person has in bad faith wrongfully taken, concealed, or disposed of property belonging to … the estate of a decedent … the person shall be liable for twice the value of the property recovered by an action under this part.” (§ 859.) Specifically, appellants challenge the validity of the trial court’s imposition of the statutory double-liability penalty under section 859 in which John was ordered to pay the estate $136,000 and Elaine was ordered to pay the estate $120,000, which sums represented double the amounts that John and Elaine were required to restore to TAP due to the improper sums they paid to themselves as improper compensation from TAP’s bank account. According to appellants, because the improper corporate payments were taken from and belonged to TAP at that time, and the sums were later restored to TAP and not the estate, the trial court erred in applying section 859 thereto. We disagree. When viewed as a whole, the comprehensive factual situation as found by the court and the equitable relief granted to address it were considerably more complex than appellants portray. For the reasons explained below, we conclude the trial court was permitted to grant section 859 relief under the unique circumstances presented.

As we have observed, the trial court was attempting to resolve the entire controversy before it, a controversy that involved bad faith wrongdoing on appellants’ part that directly impacted what the estate would have received from TAP by virtue of the estate’s one-third ownership interest therein. To recapitulate the relevant background, TAP, a closely held corporation, had sold its real estate, had ceased to conduct business and was apparently in a position to wind up and distribute its assets to the three remaining shareholders. In that context, appellants, as those controlling TAP, postponed dissolution and instead engaged in a pattern of making improper corporate payments to themselves. In doing so, appellants enriched themselves while also draining the amount the estate would otherwise receive for its one-third ownership. The trial court sought to remedy that situation under its equitable powers, as aided by section 850 et seq., through a series of steps: (i) appellants were directed to return the improper payments to TAP, (ii) the trial court then valued the estate’s one-third share of TAP, and lastly, (iii) the trial court ordered TAP to pay the estate its one-third share.

In light of the entirety of the relief granted by the trial court, it is evident that when John was ordered to return $68,000 to TAP and Elaine was ordered to return $60,000 to TAP—which were the bases for the trial court’s application of section 859—the trial court’s purpose was to preserve, restore or recover property that would at least partly benefit the estate. That is, such returned property, or a one-third portion thereof, would be passed through TAP and go to the estate because of the trial court’s additional remedy of ordering the estate be paid its one-third share of TAP’s assets. In this sense, the returned funds ultimately represented a recovery of property to the estate, based on the estate’s claim thereto, even though the recovery was accomplished indirectly through TAP. For these reasons, we conclude the trial court had adequate grounds to apply section 859.

However, while the trial court had a reasonable basis to apply the section 859 statutory penalty in this case, we conclude that it failed to compute the correct amount of the penalty. The statute provides that the penalty imposed is to be “twice the value of the property recovered” by the party filing an action under section 850. (§ 859.) Here, the trial court doubled the $68,000 John was required to return to TAP and likewise doubled the $60,000 that Elaine was required to return to TAP, resulting in penalties of $136,000 and $120,000, respectively, that had to be paid by John and Elaine to the estate. The error with this calculation was that the estate did not recover the entire amounts of the $68,000 and $60,000 from appellants. Instead, once those amounts were repaid by appellants to TAP, the estate itself would only be entitled to recover one-third of those sums based on the trial court’s order that TAP distribute to the estate its one-third share of TAP’s assets. Therefore, the proper calculation should have been one-third of $68,000, times two (or $45,333.32), as the penalty owed by John to the estate, and one-third of $60,000, times two (or $40,000), as the penalty owed by Elaine to the estate.

DISPOSITION

The judgment is modified to correct the amount of the statutory penalties awarded under section 859. The penalty owed by John to the estate is $45,333.32, and the penalty owed by Elaine to the estate is $40,000. In all other respects, the judgment of the trial court is affirmed. Costs on appeal are awarded to respondents.

LEVY, Acting P.J.

WE CONCUR:

FRANSON, J.

PEÑA, J.