Filed 10/23/20 Marriage of Peterson CA3

NOT TO BE PUBLISHED

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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

THIRD APPELLATE DISTRICT

(Mono)

—-

In re the Marriage of TARA LEE and BRENT PETERSON. C088076

TARA LEE PETERSON,

Appellant,

v.

BRENT PETERSON,

Respondent.

(Super. Ct. No. FL161047)

Appellant Tara Lee Peterson (Tara) appeals from a judgment that characterized and divided real and personal property pursuant to a divorce proceeding between her and Brent Peterson (Brent).

Tara now contends (1) both parties were denied due process because the trial court failed to follow proper procedure after granting Tara’s motion to reopen testimony; (2) the trial court abused its discretion in determining the value of the family residence; and (3) the trial court erred in categorizing the proceeds from the sale of a Crest Lane/Forest Trail property as Brent’s separate property and in finding that Brent successfully traced those proceeds to certain separate property interests.

We conclude (1) Tara has not established a denial of due process, (2) the trial court did not abuse its discretion, and (3) Tara’s claims of trial court error lack merit.

We will affirm the judgment.

DISCUSSION

We dispense with a separate background section and provide background facts in the discussion as relevant to the contentions on appeal.

“The most fundamental rule of appellate review is that a judgment is presumed correct, all intendments and presumptions are indulged in its favor, and ambiguities are resolved in favor of affirmance.” (City of Santa Maria v. Adam (2012) 211 Cal.App.4th 266, 286.) “In reviewing a judgment based upon a statement of decision following a bench trial, we review questions of law de novo.” (Thompson v. Asimos (2016) 6 Cal.App.5th 970, 981.) We review the trial court’s findings of fact, both express and implied, for substantial evidence. (Ermoian v. Desert Hospital (2007) 152 Cal.App.4th 475, 501.) “A single witness’s testimony may constitute substantial evidence to support a finding. [Citation.] It is not our role as a reviewing court to reweigh the evidence or to assess witness credibility.” (Thompson, at p. 981.)

I

Tara contends the trial court failed to follow applicable procedure after granting her motion to reopen testimony, which she claims resulted in a denial of due process to both parties. Although Tara forfeited the contention by failing to support it with relevant legal authority, the claim would fail on the merits in any event.

A

Following trial, the parties submitted their closing arguments in writing, and the trial court issued a proposed statement of decision as its tentative decision, inviting objections from the parties. The parties each filed objections and the trial court issued a tentative ruling on the objections. Sometime thereafter, but before a hearing on the objections, Tara learned that Brent failed to disclose additional income in his final disclosures. She filed a motion to reopen testimony in order to present evidence of this additional income for purposes of calculating child support. She argued Brent’s failure to disclose the income could impact the credibility of his trial testimony.

Brent opposed the motion. He admitted a change in his income, noted that the change was now disclosed, agreed that the additional income should be used to calculate child support, and argued there was no need to reopen testimony.

The initial hearing on Tara’s motion was continued to allow Tara to retain a court reporter. On August 23, 2018, with a court reporter present, the trial court granted Tara’s motion to reopen testimony and invited her to present evidence of Brent’s additional income. Tara objected to the timing, stating she was not prepared to present additional evidence. Tara argued that by granting her motion, the trial court had opened the issue of Brent’s credibility throughout the trial and the trial court was required to resubmit the case for decision.

It was Brent’s understanding, however, that if the trial court granted Tara’s motion to reopen testimony, the trial court would receive at that hearing any new evidence related to Brent’s income. The trial court agreed with Brent’s understanding and said it would consider at that hearing any evidence on the issue of child support. Tara’s counsel proceeded to question Brent under oath about his income.

After the questioning of Brent was completed, Tara’s counsel again argued that Brent’s failure to disclose the additional income should affect the trial court’s determination of Brent’s credibility on every issue presented for decision in the dissolution action, and the trial court was required to make new findings and determinations on all the issues.

Brent’s counsel countered that the trial court had discretion under Code of Civil Procedure section 662 to limit the scope of its decision to reopen evidence. Brent’s counsel asked the trial court not to reopen everything but to limit the reopened issue to child support.

On September 6, 2018, the parties appeared again before the trial court. The trial court stated its understanding that the motion to reopen had been resolved but asked Tara’s counsel if there was anything further regarding that motion. Tara’s counsel responded, “No, I don’t think so, your Honor. My recollection is that testimony was reopened. There was further evidence. That evidentiary portion of the trial then concluded. I believe both parties then made additional oral arguments, and I think that was the effective conclusion, if you will, of the trial. So I do not have any additional evidence.”

The trial court heard argument on the objections to the proposed statement of decision, affirmed its tentative rulings on the objections, and modified its tentative decision on child support to include Brent’s additional income. When the trial court indicated it would be in recess and reconvene later that day, the court reporter said she would not be available for that portion of the hearing. As a result, we have no record of what transpired later that day.

The trial court filed the judgment of dissolution on September 11, 2018.

B

Tara argues the trial court failed to follow proper procedure in moving the matter to judgment, causing confusion about the procedural status of the case posttrial. She further asserts that by granting her motion to reopen testimony, the trial court vacated submission of the cause, reopened discovery, and was now required to “resubmit the matter for decision, state its findings, and thereafter render a decision . . . .” She claims the trial court’s failure to do these things resulted in a denial of due process for both parties. But Tara has not established a denial of due process.

At the conclusion of a bench trial, the trial court must announce its tentative decision. (Cal. Rules of Court, rule 3.1590(a).) A trial court may issue a proposed statement of decision as its tentative decision, subject to the parties’ objections. (Cal. Rules of Court, rule 3.1590(c)(1).) Here, the trial court issued a proposed statement of decision, explained that it was intended as its tentative ruling, and invited objections from the parties. The trial court issued a tentative ruling on the objections asserted by the parties, heard argument on the objections, and modified the proposed statement of decision based on the evidence and argument presented. The trial court then issued the final judgment of dissolution.

We find no error in the trial court’s process for bringing the matter to judgment. Tara argues the trial court confused the matter by not issuing a tentative decision after the trial, but as we have explained, the trial court did in fact issue a tentative decision after the trial.

Tara further argues the impact of her motion to reopen testimony was vast and essentially gave her a do-over in the trial court. Specifically, she asserts that by granting her motion, the trial court “vacated the submission of the cause for decision,” discovery automatically reopened, and the trial process began “ ‘anew.’ ” She further asserts the trial court was then required to “resubmit the matter for decision, state its findings, and thereafter render a decision and ultimately issue a Statement of Decision consistent with its findings.” Her arguments fail, however, because she does not support them with relevant legal authority. Tara relies on case law pertaining to motions for a new trial but does not show how those decisions apply in this context. As a result, we need not address them further. (People v. Hardy (1992) 2 Cal.4th 86, 150 [a reviewing court need not address any issue asserted without sufficient argument or citation to relevant authority].)

II

Tara next contends the trial court abused its discretion in determining that the value of the family residence was $919,000. In support of her contention, Tara argues the trial court erred in rejecting the appraisal submitted by her expert, in failing to make findings in support of its valuation, and in making a valuation that was not supported by substantial evidence. After considering each of Tara’s arguments, we find no abuse of discretion.

A

Trial courts have broad discretion to determine the value of community assets. (In re Marriage of Cream (1991) 13 Cal.App.4th 81, 88.) “In the exercise of its broad discretion, the trial court ‘makes an independent determination of value based upon the evidence presented on the factors to be considered and the weight given to each. The trial court is not required to accept the opinion of any expert as to the value of an asset.’ [Citations.] Differences between the experts’ opinions go to the weight of the evidence. [Citation.] Rather, the court must determine which of the recognized valuation approaches will most effectively achieve substantial justice between the parties.” (In re Marriage of Duncan (2001) 90 Cal.App.4th 617, 632 (Duncan).) “ ‘[R]esolution of conflicts in the evidence, assessment of the credibility of the witnesses and the weight to be given the opinions of the experts [are] all matters within the exclusive province of the [trial court as the] trier of fact.’ ” (In re Marriage of Ackerman (2006) 146 Cal.App.4th 191, 204.)

“The trial court’s determination of the value of a particular asset is a factual one and as long as that determination is within the range of the evidence presented, we will uphold it on appeal.” (Duncan, supra, 90 Cal.App.4th at p. 632.)

B

The value of the family residence at the time of trial was a controverted issue. Tara’s expert opined that on July 20, 2017, the family residence was worth $800,000, but by May 8, 2018, the family residence had increased in value to $840,000. (We will refer to Tara’s expert’s opinion as the Riffel appraisal.) Moreover, Tara was a real estate agent and she testified the Riffel appraisal was accurate. She disagreed with the appraisal prepared by Brent’s expert, who opined that as of October 24, 2017, the family residence was worth $1,030,000. (We will refer to Brent’s expert opinion as the Sawyer appraisal.) Tara argued the Sawyer appraisal had numerous flaws, rendering it unreliable. Brent countered that the Riffel appraisal was itself flawed.

In addition to the Riffel and Sawyer appraisals, a third appraisal was submitted to the trial court prepared by Bank of America (the bank appraisal). The bank appraisal was prepared in response to Tara’s application for a home equity line of credit in 2018. Using a desktop valuation, the bank concluded that on March 10, 2018, the family residence was worth $950,000. Tara argued the bank appraisal was unreliable because it exaggerated the value and was performed by a non-local appraiser who never inspected the home.

The trial court noted that although the parties had identified flaws in the opposing appraisals, the appraisals from their own experts appeared self-serving to the point that they had questionable credibility. The trial court “weighed and considered all of the appraisals and opinions, together with their respective flaws,” and found the bank appraisal to be the most reliable. But because the bank appraisal did not account for needed repairs to a lower deck of the residence, the trial court reduced the amount, finding the value of the family residence at the time of trial to be $919,000.

C

Tara argues the Riffel appraisal was the best evidence of the property’s value because it was made closest in time to the trial, it was based on the condition of the home inside and out, and it was supported by her own testimony as a real estate agent and homeowner. She notes the trial court accepted two other appraisals by her expert in valuing other community assets. Thus, she concludes it was error for the trial court to reject the Riffel appraisal. In essence, Tara is rearguing the evidence on appeal, quarreling with the trial court’s credibility determinations and the weight it gave to the evidence. However, assessing the weight and credibility of evidence is the exclusive province of the trial court.

Tara also argues the trial court erred in failing to make detailed findings in support of its valuation. Although she acknowledges there is no existing authority requiring the trial court to make such findings, she invites us to create new precedent to dictate the standard that trial courts must follow in determining the value of an asset based on conflicting or disputed evidence. We decline her invitation.

Tara further argues there is insufficient evidence to support the trial court’s valuation of the family residence. We disagree. The Riffel appraisal valued the property at $840,000. The Sawyer appraisal valued the property at $1,030,000. The bank appraisal found the property to be worth $950,000, an amount that fell within the range of the evidence presented at trial. (Duncan, supra, 90 Cal.App.4th at pp. 631-632.) Tara argues the trial court abused its discretion in reducing the appraised value of the family residence to $919,000 to account for necessary repairs, but as we have explained, a judgment is presumed correct absent a showing to the contrary. (City of Santa Maria v. Adam, supra, 211 Cal.App.4th at p. 286.) Tara points to no evidence in the record to support her argument and cites no legal authority for how this was an abuse of the trial court’s discretion. We conclude the trial court’s valuation is supported by substantial evidence and the trial court did not abuse its discretion.

III

Tara contends the trial court erred in categorizing the proceeds from the sale of the Crest Lane/Forest Trail property as Brent’s separate property and in finding that Brent successfully traced those proceeds to certain separate property interests.

A

We review the trial court’s determination as to whether certain property is separate or community for substantial evidence. (In re Marriage of Dekker (1993) 17 Cal.App.4th 842, 849.) The appellant bears the burden of establishing error. (In re Marriage of Cochran (2001) 87 Cal.App.4th 1050, 1056.)

“ ‘Property acquired by purchase during marriage is presumed to be community property, and the burden is on the spouse asserting its separate character to overcome the presumption. [Citations.] The presumption applies when a husband purchases property during the marriage with funds from . . . an account . . . in which he has commingled his separate funds with community funds.’ ” (In re Marriage of Marsden (1982) 130 Cal.App.3d 426, 441.) “[I]f separate property is commingled with community property in a bank account, then the owner of the separate property has the burden of keeping records establishing community funds were exhausted when the purchase was made.” (In re Marriage of McLain (2017) 7 Cal.App.5th 262, 273.) “A burden of recordkeeping logically arises out of the very act of commingling funds during marriage so the general community property presumption is not thwarted.” (In re Marriage of Ficke (2013) 217 Cal.App.4th 10, 25.)

Separate property may be traced from “specific community property to which the separate property was originally contributed” to “any other community property that is subsequently acquired from the proceeds of the initial property, and to which the separate property contribution can be traced.” (In re Marriage of Walrath (1998) 17 Cal.4th 907, 918.) Either “ ‘direct tracing’ ” or “ ‘family living expense tracing’ ” may be used. (In re Marriage of Braud (1996) 45 Cal.App.4th 797, 823 (Braud).) “Under the ‘direct tracing’ method, the disputed asset . . . is traced to the withdrawal of separate property funds from the commingled account.” (Ibid.) The direct tracing method “requires specific records reconstructing each separate and community property deposit, and each separate and community property payment as it occurs.” (Ibid., italics omitted.) “[O]ral testimony of intent” or “records that simply total up all separate property funds available during the relevant period and all the separate expenditures during that period” are inadequate to establish separate property status. (Ibid.)

B

In 1999, prior to the parties’ marriage, Brent purchased the Crest Lane/Forest Trail property with another individual (B.W.) for approximately $250,000. At all relevant times, Brent held title as his separate property.

When the parties married in 2004, the principal balance on the mortgage for the Crest Lane/Forest Trail property was $210,498.35, and the value of the property was approximately $600,000. During their marriage, the community paid down the principal balance on the mortgage and paid insurance premiums on the property.

In 2005, the property’s value was appraised at either $725,000 or $740,000, depending on the valuation method. Then, in 2006, the property flooded when a water line burst. The flood caused extensive damage to the home. The insurance company agreed to make improvements to repair the property. Among other general improvements, new appliances and new flooring were added, along with an additional room. Neither party submitted an appraisal or opined on the value of the property following these improvements.

In 2009, the Crest Lane/Forest Trail property sold for $595,000. At the time of the sale, the principal balance due on the mortgage was $188,237.82. From that sale, Brent received a net payment of $190,158.62. He deposited the entire amount into his Union Bank account ending in 1674.

On April 7, 2010, Brent withdrew $70,000 from his Union Bank account, and paid that money to Tara. The following day, Tara deposited $70,000 into her Bank of America account ending in 7183/0415.

On April 13, 2010, Tara and Brent purchased an Outback Travel Trailer for $21,724.75. They held joint title to the trailer. That same day, Tara also made two payments to the parties’ home equity line of credit: a $15,000 payment and a separate $35,000 payment. No evidence was offered to explain why the payments on the home equity line of credit were made this way.

On February 9, 2011, Brent moved another $100,000 from his Union Bank account to Tara’s TD Ameritrade account ending in 7438. Brent testified he moved this money into Tara’s Ameritrade account so that it would earn more money than it was earning in a checking account.

In October 2011, Tara transferred $30,000 out of her 7438 Ameritrade account. The trial court found the only plausible explanation for this withdrawal was that the parties were providing financial assistance to Brent’s mother.

Two years later, in October 2013, Tara moved the remaining $70,000 from her 7438 Ameritrade account to another TD Ameritrade account ending in 4886. After she made that transfer, the balance in Tara’s 4886 Ameritrade account was $71,216.87, which included only the $70,000 deposit and the income that deposit generated. As of April 30, 2018, the balance in Tara’s account ending in 4886 was $86,202.96. There was no evidence of any deposit being made into the 4886 account other than the initial $70,000 transfer from Tara’s 7438 Ameritrade account.

Based on this evidence, the trial court found there was “insufficient evidence to determine the extent to which, if any, the improvements from the insurance claim increased the fair market value of [the Crest Lane/Forest Trail property] given the sale price was less than the value at the date of marriage and less than the appraised value in 2005.” The trial court also found that the proceeds from the sale of the Crest Lane/Forest Trail property were Brent’s separate property “subject to a small pro tanto interest resulting from the community’s payment of principal reducing the principle balance on the loan.” The trial court determined the pro tanto amount to be $11,020, or 5.8 percent of $190,000.

But the trial court found that Brent failed to sufficiently trace the amounts Tara paid toward the home equity line of credit. The trial court noted the parties historically used that line of credit to pay community expenses and the “balance fluctuated over time.” Thus, finding no agreement to the contrary, the use of Brent’s separate property to pay community debts was not reimbursable to Brent. However, the trial court found that Brent had sufficiently traced the Crest Lane/Forest Trail proceeds to the balance of money in Tara’s 4886 Ameritrade account. The trial court ruled that the balance of money in that account was Brent’s separate property. The trial court explained that although the records for Tara’s 4886 account were incomplete, the only evidence of a deposit into that account was for $70,000, the same amount Brent transferred to her from the Crest Lane/Forest Trail proceeds.

Finally, the trial court found that Brent sufficiently traced Crest Lane/Forest Trail proceeds to the purchase of the Outback Travel Trailer as his separate property, or in the alternative, that Brent was entitled to reimbursement pursuant to Family Code section 2640 [reimbursement for separate property contribution to acquisition of property]. The trial court ultimately awarded the Outback Travel Trailer to Brent without offset.

C

1. The Crest Lane/Forest Trail Proceeds

Tara claims the trial court erred in categorizing the proceeds from sale of the Crest Lane/Forest Trail property as Brent’s separate property. We disagree.

“Where community funds are used to make payments on property purchased by one of the spouses before marriage ‘the rule developed through decisions in California gives to the community a pro tanto community property interest in such property in the ratio that the payments on the purchase price with community funds bear to the payments made with separate funds.’ ” (In re Marriage of Moore (1980) 28 Cal.3d 366, 371-372.) The decision in In re Marriage of Marsden, supra, 130 Cal.App.3d 426, reaffirmed this rule and set out a formula for calculating the amount of the community and separate property interests. (Id. at pp. 436-437.) Here, the trial court considered the community’s contribution to reducing the amount owed on the Crest Lane/Forest Trail property and calculated the community’s pro tanto interest in the proceeds from its sale to be $11,020 (or 5.8% of $190,000).

Tara claims the community funds used to improve the Crest Lane/Forest Trail property became so entangled with Brent’s separate property interest that it changed the property to a community asset. But “[a]bsent an agreement to the contrary, the use of community funds to improve the separate property of one spouse does not alter the character of the separate property.” (In re Marriage of Wolfe (2001) 91 Cal.App.4th 962, 966.)

2. Payments on the Home Equity Line of Credit

Tara also claims the trial court erred in finding that the community’s $11,020 pro tanto interest in the proceeds from the Crest Lane/Forest Trail property was used to pay down a home equity line of credit, which the trial court characterized as a community debt. In support of her claim, Tara argues that because an identical sum of money was withdrawn and returned six days later, there is no evidence the community’s pro tanto interest was liquidated in the home equity line of credit. She offers no legal authority to support the argument, saying only that there was contrary documentary evidence before the trial court.

The record shows, however, that Brent received $190,158.62 from the sale of the Crest Lane/Forest Trail property. The trial court calculated the community’s interest in those proceeds to be $11,020, and Tara does not challenge that calculation. On April 7, 2010, Brent wrote Tara a cashier’s check for $70,000 from the Crest Lane/Forest Trail proceeds. Tara deposited the $70,000 into her account and five days later paid $50,000 to the parties’ home equity line of credit. The line of credit was being used to pay community expenses.

The trial court found that the first $11,020 of that $50,000 payment exhausted the community’s interest in the Crest Lane/Forest Trail proceeds, leaving the remainder as Brent’s separate property. Contrary to Tara’s argument, the record supports the trial court’s determination that the $11,020 pro tanto amount was used to pay community debt and was not reimbursable to Brent. We find no error.

3. The Outback Travel Trailer

Tara claims the trial court erred in finding that Brent overcame the presumption of title in characterizing the Outback Travel Trailer as Brent’s separate property.

Although title to the trailer was held jointly, the trial court found that Brent sufficiently traced the funds used to purchase the trailer to his separate property. According to the trial court, either Brent was entitled to the trailer or he was entitled to a reimbursement in the amount of the purchase price under Family Code section 2640. The trial court awarded the trailer to Brent without offset.

Family Code section 2640 provides that “unless a party has made a written waiver of the right to reimbursement or has signed a writing that has the effect of a waiver, the party shall be reimbursed for the party’s contributions to the acquisition of property of the community property estate to the extent the party traces the contributions to a separate property source. The amount reimbursed shall be without interest or adjustment for change in monetary values and may not exceed the net value of the property at the time of the division.” (Fam. Code, § 2640, subd. (b).)

Here, substantial evidence supports the trial court’s finding that Brent traced funds from the sale of his separate property to the purchase of the trailer. (See Braud, supra, 45 Cal.App.4th at p. 823 [whether a spouse has adequately traced an asset to a separate property source is a question of fact for the trial court].) It is undisputed that on April 7, 2010, Brent wrote a cashier’s check to Tara for $70,000. That money came from the sale of his separate property. The following day, Brent and Tara purchased the trailer for $21,724.75. Tara offered no evidence that the money came from anywhere other than Brent’s separate property, $70,000.

Because we must make all inferences in favor of the judgment, we must infer that Brent’s separate property funds were used to purchase the trailer. Brent was thus entitled to a reimbursement from the community for its purchase price. (In re Marriage of Weaver (2005) 127 Cal.App.4th 858, 865; Fam. Code, § 2640.) The trial court was required to divide the community estate equally. (Fam. Code, § 2550.) In so doing, the trial court awarded Brent the trailer without offset, rather than ordering the community to reimburse Brent the $21,724.75 purchase price (or whatever the value of the trailer was at the time of trial if it was lower). Tara offers no argument for why this decision was prejudicial to her.

4. TD Ameritrade Account

Tara also claims there was insufficient evidence to adequately trace the funds in the TD Ameritrade Investment account as of the time of trial. We disagree.

Substantial evidence supports the trial court’s finding that as of April 30, 2018, no money other than Brent’s separate property was deposited into Tara’s 4886 Ameritrade account. It is undisputed that on February 9, 2011, Brent transferred $100,000 of his separate property funds into Tara’s 7438 Ameritrade account, which previously had a balance less than $7. Brent testified that he and Tara did this in order to move the money into an account where it would grow, rather than languishing in a checking account. Because Tara’s 7438 Ameritrade account was already open, it was easier than if they were to open another account.

It is undisputed that the parties then took $30,000 out of Tara’s 7438 Ameritrade account and loaned it to Brent’s mother. It also is undisputed that two years later, Tara transferred the balance of her 7438 Ameritrade account ($71,216.87) into her 4886 Ameritrade account. The balance consisted of $70,000 remaining from the initial $100,000 deposit of Brent’s separate property and the money that $70,000 had earned in the intervening years.

Between October 2013 and April 30, 2018, the balance in Tara’s 4886 Ameritrade account grew only to $86,202.96. There was no evidence of additional deposits being made into this account or expenses being paid from this account. Making all inferences in favor of the judgment, we must infer that no additional money was deposited into this account in the intervening years. The evidence is sufficient to support the trial court’s finding that Brent sufficiently traced his separate property funds into Tara’s 4886 Ameritrade account.

DISPOSITION

The judgment is affirmed.

/S/

MAURO, J.

We concur:

/S/

ROBIE, Acting P. J.

/S/

DUARTE, J.