Filed 8/11/23
CERTIFIED FOR PARTIAL PUBLICATION*
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION THREE
In re MARRIAGE of KIKIANNE and
SCOTT COLE.
___________________________________ A163975
KIKIANNE COLE, (Contra Costa County
Respondent, Super. Ct. No. D12-03933)
v.
SCOTT COLE,
Appellant.
The trial court denied Scott Cole’s request to reduce or eliminate his
child support obligations for calendar year 2020 and awarded attorney fees to
Kikianne Cole.1 We affirm. In the published portion of this opinion, we hold
the trial court did not abuse its discretion in concluding that Scott’s reported
salary income in 2020 was not determinative of his ability to pay child
support in 2020 and that he possessed sufficient financial assets and imputed
* Pursuant to California Rules of Court, rules 8.1100 and 8.1110, this
opinion is certified for publication with the exception of part B of the
Discussion.
1 Because the parties share the same last name, we refer to them by
their first names for the sake of clarity and intend no disrespect.
1
income to meet his child support obligations. In the unpublished portion, we
hold the court did not abuse its discretion in awarding attorney fees.
FACTUAL AND PROCEDURAL BACKGROUND
Scott and Kikianne dissolved their marriage in 2015, and a “Judgment
and Marital Settlement” was entered by the court. In November 2019, the
parties entered a stipulation and order requiring Scott to pay Kikianne child
support in the amount $7,537 per month for their two minor children. The
order also required that Scott pay bonus child support in accordance with a
bonus wages report table, capped by Scott’s gross employment earnings of
$2 million per year.
For calendar year 2020, Scott’s child support obligations totaled
$90,444 ($7,537 x 12 months). Although Scott paid child support for the
months of January, February, and March 2020 (totaling $22,611), he stopped
making payments in April 2020 without Kikianne’s stipulation or an order of
the court.
In May 2020, Scott filed a request for an order modifying his 2020 child
support obligations. As the sole shareholder and director of his law firm,
Scott Cole and Associates (SCA), Scott alleged that his firm encountered
severe economic challenges due to the COVID-19 pandemic and that he had
stopped taking a salary from SCA as one of several measures to keep his
business afloat. He requested that the court suspend child support payments
or set payments to zero.
In opposing the modification request, Kikianne contended that Scott
maintained assets, income, and access to funds in excess of $20 million and
that he essentially failed to disclose all available income to pay child support.
2
After making temporary interim orders to continue child support, the
trial court set a long cause hearing for Scott’s request and the respective
requests of the parties for attorney fees.
The long cause hearing occurred over two days in March and April
2021. The court considered the parties’ briefings, received certain of the
parties’ exhibits into evidence, and heard Scott’s testimony. The court also
heard the testimony of Mary Beth Yanulis, an attorney and custodian of
records for Morgan Stanley Smith Barney and Morgan Stanley Bank NA,
which maintained 12 accounts associated with Scott (the Morgan Stanley
accounts).
The trial court subsequently issued a proposed decision, to which Scott
lodged objections and claims of error. Thereafter the court issued a final
written statement of decision with rulings on Scott’s objections and claimed
errors. In making its rulings, the court indicated it found Scott’s testimony
“largely unbelievable” concerning his personal finances and transactions.
Specifically, the court observed that Scott had little recall of specific and
significant facts related to his personal finances and that he was evasive and
often impeached by other evidence when questioned about the value of his
real estate holdings, the value of his Morgan Stanley investment portfolios
and financial holdings, and details of other financial transactions including a
loan application he signed in 2019.
Details of the court’s factual and legal findings will be addressed in the
Discussion, post, but for now we note the court denied Scott’s modification
request and ordered him to pay $90,444, which represented the entire
amount of child support due in 2020. The court also ordered Scott to pay
Kikianne’s attorney fees in the amount of $123,909, finding that the awarded
sum “does not impose an unreasonable burden against [Scott], given his
3
financial condition.” In its statement of decision, the court commented, “It is
unfortunate that an experienced, successful attorney with considerable
financial assets and holdings has undertaken vigorous litigation to deprive
his children of the support that they require to maintain their status in life.
At this point in the litigation, the Parties have spent more money litigating
this case than the amount of support that is owed to the Parties’ children.
The people who suffered most during this ordeal are the [Parties’] minor
children.”
This appeal followed.
DISCUSSION
Scott challenges the trial court’s denial of his request to reduce or
eliminate his child support obligations for calendar year 2020. He also
contends the court’s attorney fee award must be reversed. We address these
issues in turn.
A. Denial of Child Support Modification
California has a strong public policy favoring adequate child support.
(In re Marriage of Usher (2016) 6 Cal.App.5th 347, 356 (Usher).) This policy
is set forth in the Family Code2 (§ 4050 et seq.), which provides for a
mandatory statewide uniform child support guideline (“the guideline”). (See
Usher, at p. 356.) The guideline is a “complex statutory formula” for
calculating child support based largely on “parental income and net monthly
disposable income” of parents. (Ibid.; see § 4055.) In this context, parental
income generally means “income from whatever source derived” (§ 4058,
subd. (a)), including salaries, bonuses, and interest (id., subd. (a)(1)), as well
as “[i]ncome from the proprietorship of a business, such as gross receipts from
2 All further statutory references are to this code unless otherwise
specified.
4
the business reduced by expenditures required for the operation of the
business” (id., subd. (a)(2)). The guideline also contemplates that the
“earning capacity of a parent” may be considered in lieu of the parent’s actual
income, “consistent with the best interests of the children.” (§ 4058,
subd. (b)(1).)3
In implementing the guideline, courts must adhere to certain basic
principles, including: (1) the “first and principal obligation” of a parent “is to
support the parent’s minor children according to the parent’s circumstances
and station in life” (§ 4053, subd. (a)); (2) a parent should pay for the support
of the children “according to the parent’s ability” (id., subd. (d)); (3) the
interests of children are “the state’s top priority” (id., subd. (e)); (4) because
children “should share in the standard of living of both parents,” child
support may “appropriately improve” the custodial household’s standard of
living “to improve the lives of the children” (id., subd. (f)); (5) the guideline
seeks to “encourage fair and efficient settlements” of parental conflicts and to
“minimize the need for litigation” (id., subd. (j)); and (6) child support orders
“shall ensure that children actually receive fair, timely, and sufficient
support reflecting the state’s high standard of living and high costs of raising
children compared to other states” (id., subd. (l)).
The amount of child support established by the guideline formula is
presumptively correct. (§ 4057, subd. (a).) However, courts may depart from
the guideline amount under several circumstances, including those situations
3 At the time of the long cause hearing below, the same earning capacity
language appeared in former subdivision (b) of section 4058. Effective
September 27, 2022, subdivision (b) of section 4058 was divided into three
subdivisions, and the quoted language was placed in subdivision (b)(1).
(Stats. 2022, ch. 573, § 4 (Assem. Bill No. 207).) For the sake of clarity this
opinion cites to the current statutory provision.
5
in which “ ‘[a]pplication of the formula would be unjust or inappropriate due
to special circumstances in the particular case.” (§ 4057, subd. (b)(5).) For
instance, one court found special circumstances where a parent who was a
principal of a company voluntarily agreed to defer a substantial portion of his
salary while still working full time and using his other assets to continue
living a wealthy lifestyle. (In re Marriage of Berger (2009) 170 Cal.App.4th
1070 (Berger).)
As indicated above, Scott and Kikianne entered a stipulation and order
in November 2019 that fixed Scott’s monthly child support obligations at
$7,537 ($90,444 annually). Six months later, Scott filed a motion requesting
reduction of child support to zero because: “My financial situation has
changed significantly and negatively as a result of the COVID-19 pandemic.
I have not been able to afford to take a salary for myself since February 2020
in an effort to keep my business going.” Scott claimed that his law firm SCA
was able to collect “only a fraction” of the settlements and judgments it was
owed and that SCA laid off three employees and slashed its expenses by at
least 25 percent in order to survive. He also represented that he and his
current spouse were living off their savings, carrying two mortgages, and
trying to avoid foreclosure.
Generally, courts will not modify child support “unless there has been a
material change of circumstances following the previous determination.”
(Usher, supra, 6 Cal.App.5th at p. 357.) Where, as here, a parent seeks to
reduce a support order, that parent shoulders the burden of proving changed
circumstances (id. at pp. 357–358) and a lack of ability and opportunity to
earn the income necessary to pay the court-ordered support (In re Marriage of
McHugh (2014) 231 Cal.App.4th 1238, 1246–1247 (McHugh); see In re
Marriage of Leonard (2004) 119 Cal.App.4th 546, 556 [determination of
6
modification request may properly rest on the fluctuations in ability to pay]).
“ ‘There are no rigid guidelines for evaluating whether circumstances have
sufficiently changed to warrant a child support modification.’ ” (Usher, at
p. 358.) Though determinations must be made on a case-by-case basis, the
“ ‘overriding issue is whether a change has affected either party’s financial
status.’ ” (Ibid.)
An order denying child support modification is reviewed for abuse of
discretion and will be reversed “only if prejudicial error is found from
examining the record below.” (In re Marriage of Pearlstein (2006) 137
Cal.App.4th 1361, 1371.) However, the matter of child support is highly
regulated, and a trial court may exercise discretion only as provided by
statute or rule. (Ibid.) Accordingly, an order that hinges on a matter of
statutory interpretation presents “a question of law that we review de novo.”
(Id. at pp. 1371–1372.)
By the time of the long cause hearing, Scott submitted evidence that
SCA paid him a salary of $100,000 for all of 2020. The trial court denied
Scott’s modification request after finding that his $100,000 income from SCA
was “just one factor” to consider. Holding Scott to his burden as the party
seeking a reduction, the court determined that Scott “failed to prove, by a
preponderance of the evidence, that he and SCA experienced a material
change of circumstances to warrant an adjustment or suspension” of his 2020
child support obligations and also failed to prove “by a preponderance of the
evidence that the gross receipts received by SCA, reduced by expenditures
required for ongoing operations, left him with insufficient income, assets, or
access to funds” to meet such obligations. (See McHugh, supra, 231
Cal.App.4th at pp. 1246–1247; Usher, supra, 6 Cal.App.5th at pp. 357–358.)
In short, the court concluded that Scott’s $100,000 income was “not
7
determinative of his ability to pay” his 2020 child support obligations and
that Scott “maintains sufficient earning capacity and imputed income” to
meet such obligations. For the reasons that follow, the trial court did not err
or abuse its discretion in so concluding.
There is no dispute that Scott is the only shareholder and sole director
of SCA. Likewise, there is no dispute that SCA “is substantially under”
Scott’s control and that Scott “has the unilateral ability to set his income.”
As Scott explained in his testimony, he determines the amount of income that
SCA pays to him “based on the needs of the business and based on personal
needs,” and “if the income is needed on the personal side” and “the business
can afford it,” then he “can make adjustments.”
The evidence showed that, from 2017 through 2019, Scott reported his
salary from SCA as follows. In 2017, Scott received a salary of $11,126,167.
In 2018, Scott received a salary of at least $578,767. Although no tax return
for 2019 appears in the record, Scott claimed a base income of approximately
$117,000 per month ($1,404,000 for the year) in a residential loan application
that he signed on October 11, 2019. Scott also stated in that application that
he had total assets (stocks, bonds, real estate) worth $6,419,040 and a net
worth over $4 million. As the trial court properly recognized, statements by a
party—such as the ones Scott made in the 2019 loan application—are
competent and admissible on issues related to the calculation of child
support. (In re Marriage of Calcaterra and Badakhsh (2005) 132 Cal.App.4th
28, 34–35.)
For 2020, the year at issue here, Scott reported salary income of
$100,000 on his tax return. But there was also evidence that in 2020, SCA
maintained $1.4 million in reserves for law firm operating and capital
expenses, and the court so found. Although the court determined that funds
8
reserved for SCA’s day-to-day operations were not available for Scott’s 2020
child support obligations, the court found that a portion of the $1.4 million
was held “in reserves for ‘long-term investments’ ” and that such portion was
not required for SCA’s day-to-day operations.
This latter finding is important because the trial court had discretion
under section 4058, subdivision (b)(1), to consider “the earning capacity of a
parent in lieu of the parent’s income, consistent with the best interests of the
children.” Accordingly, even though Scott drew a salary of only $100,000 in
2020, the court could properly consider whether the evidence of Scott’s
earning capacity warranted imputation of additional income.
Here, substantial evidence supports the trial court’s imputation of
income in excess of Scott’s actual salary. Specifically, Scott’s testimony
indicated there were two Morgan Stanley accounts holding reserves for SCA
operations and long-term investments. Account documents showed that on
December 1, 2020, the two accounts together contained over $925,000
($307,716 in one account and over $615,000 in the other), and their combined
balance amounted to ten times the amount of child support due in 2020.
Despite Scott’s vague assertions to the contrary,4 it was reasonable for the
court to infer that SCA had sufficient funds in its reserve accounts to pay
Scott a salary that was more commensurate with his work and professional
experience as a full-time class action attorney, or at least a salary that would
have covered his 2020 child support obligations, while leaving adequate
4 The record supports the court’s observations that: (1) Scott’s testimony
was “inconsistent with documents admitted into evidence” and appeared
“either intentionally ambiguous or deliberately obscure”; (2) Scott
demonstrated a failure to “remember or recall specific and significant facts
related to” his October 2019 loan application, investment portfolios, and
financial holdings at Morgan Stanley; and (3) Scott responded to questions in
an “evasive manner.”
9
reserves for SCA’s operational expenses. On this record, no abuse of
discretion appears.
Moreover, the trial court had discretion to depart from the income-
based child support amount set by the guideline formula due to the special
circumstances demonstrated in this case. (§ 4057, subd. (b)(5).) Here, the
court determined that Kikianne “proved, by substantial evidence, that [Scott]
has significant net worth, assets, income and earning capacity available to
pay” his 2020 child support obligations. Such proof included the evidence
that: (1) Scott voluntarily and substantially slashed his salary to $100,000
even though his earning capacity was much higher and SCA has sufficient
non-operating reserves to at least cover the $90,444 he owed for child
support; (2) in lieu of Scott’s taking a larger salary to meet his personal and
family expenses in 2020, Scott and his current spouse evidently covered such
expenses in part by taking distributions totaling at least $977,000 from their
non-retirement Morgan Stanley accounts; and (3) Morgan Stanley accounts
paid at least $387,245 of Scott’s personal and business credit card expenses in
2020.5 On this record, substantial evidence supports the trial court’s
departure from the statutory guideline amount and its denial of Scott’s
modification request.
We find analogous support for our conclusion in Berger, supra, 170
Cal.App.4th 1070. In that case, the father quit his high-paying job at an
accounting firm in order to serve full time as president and chief executive
officer of his startup landscaping company. (Id. at p. 1075.) From its
inception, the startup company had “never generated a profit,” and
5 The trial court found that Scott commingled personal and business
expenditures charged to the credit card and that it was unclear whether the
bulk of the expenditures were for personal or business purposes.
10
eventually the father and other principals guaranteed certain loans to the
company and voluntarily agreed to reduce their salaries and defer income.
(Ibid.) The father also loaned the company $250,000. (Ibid.) At trial on the
father’s request to reduce his temporary child support obligation, the father
testified his landscaping company had recently been paying him an income of
$2,000 per month, but that “his total ‘deferred’ salary—defined as the
difference between the compensation his employment contract had specified
he was entitled to receive, and the compensation he had actually received—
was as high as $350,000 by the time trial commenced.” (Id. at p. 1076.) He
had agreed to his salary reduction and income deferral to avoid further
depleting his company’s capital, which he believed would harm his company’s
“ability to raise further capital in the future” and “thus imperil its viability.”
(Id. at pp. 1081–1082.) The father explained his personal expenses were over
$21,000 per month (id. at p. 1076), which “in the absence of any significant
cash salary” from his business, he was meeting “by utilizing his cash assets.”
(Id. at p. 1077.) The father estimated he had $430,000 to $450,000 left in
liquid assets and equity of $500,000 in a property he had purchased and
developed with a $1.8 million loan. (Id. at pp. 1076–1077.)
In view of the foregoing record, the trial court in Berger first concluded
“ ‘there was insufficient evidence’ demonstrating [the father] had any current
‘opportunity’ to earn the level of salary he once had while working in finance”
and “declined to impute that salary to him ‘for the calculation of support and
fees.’ ” (Berger, supra, 170 Cal.App.4th at p. 1078.) Although the court
reserved jurisdiction over the father’s deferred salary of $350,000, the court
adhered to the statutory guideline because the father received no actual
income other than his monthly $2,000 salary. (Ibid.) The court ordered the
father to pay only $1,115 in monthly support for his two children based on
11
that salary and imputed interest income on his cash assets and estimated
equity in the property he had purchased. (Ibid.)
The appellate court reversed, concluding that section 4057, subdivision
(b)(5), allows courts to depart from the guideline amount of support under
“ ‘special circumstances.’ ” (Berger, supra, 170 Cal.App.4th at pp. 1083–
1084.) In determining that special circumstances were established in the
case, Berger observed that the father was “simply choosing to invest his
salary each month back into the company, while supporting his own lifestyle
with other assets.” (Id. at p. 1074.) Significantly, Berger held that the
father’s voluntary agreement to defer his income from his startup business,
while continuing to live a wealthy lifestyle by using his other substantial
assets for his own support, did not justify reducing his obligation to pay child
support. (Id. at pp. 1073–1074.) As Berger recognized, a father may not
“unilaterally, and voluntarily, arrange his business affairs in such a way as
to effectively preclude his children from sharing in the benefits of his current
standard of living.” (Id. at p. 1082.) There, the father “could have just as
easily chosen to retain his salary—which after all, he needs to support
himself—and his family—and instead utilize his other assets to fund monthly
capital investments into his company.” (Ibid.) Thus, even if the father’s
“decision to forgo receipt of his salary” precluded the trial court from
characterizing the deferred salary as income for purposes of support, Berger
concluded the situation “demonstrates ‘special circumstances’ which warrant
a departure from the guideline amount of support” awarded by the trial
court. (Id. at p. 1083; see also In re Marriage of Sorge (2012) 202 Cal.App.4th
626, 648 (Sorge) [recognizing parental obligation “not to voluntarily act in a
way that negatively impacts the support that a child is entitled to receive
from that parent”].)
12
The record here establishes comparable special circumstances. Just
like the father in Berger, Scott was a relatively wealthy individual who
worked full time in a business that did not turn a profit during a year in
which he had child support obligations to meet. And similarly, as a principal
of the business—indeed, the only principal—Scott had the “unilateral ability
to set his income,” and he voluntarily and substantially reduced his salary
out of a stated concern that he could not keep SCA in business unless he did
so. Also similarly, despite slashing his 2020 annual salary to $100,000, Scott
maintained a relatively affluent lifestyle and relied on other resources to pay
his personal and current family expenses that far exceeded his reduced
income.6 On this score, Scott and his current spouse received over $977,000
in account distributions from Morgan Stanley in 2020, and Scott was able to
tap certain Morgan Stanley accounts to pay at least $387,245 in credit card
charges for his personal and business expenses incurred in 2020. Thus, like
the father in Berger, Scott evidently chose to substantially reduce his salary
while continuing to support his lifestyle using other available assets, instead
of drawing a salary that would cover his child support obligations and using
those other assets to keep his business going.
It bears emphasizing that one of the principal facts distinguishing this
case from Berger is one that does not work in Scott’s favor. In Berger, the
father’s startup business had “never generated a profit” from its inception.
(Berger, supra, 170 Cal.App.4th at p. 1075.) Here, however, SCA experienced
several profitable years leading up to 2020 and evidently had sufficient non-
operating reserves to pay Scott a salary that would have covered his child
support obligations. As Scott himself explained, “if the income is needed on
6 Scott’s income and expense declaration, dated December 3, 2020,
showed monthly expenses totaling $41,283.
13
the personal side” and “the business can afford it,” then he “can make
adjustments.” Though Scott attempts to distinguish his case from Berger by
claiming his decision to take a substantially reduced salary was not
voluntary but instead critical to SCA’s economic survival, the evidence of
SCA’s available reserves belies that claim. Thus, the record supports the
inference that Scott voluntarily chose to adjust his income downward for
2020 because, notwithstanding the fact that his monthly personal expenses
outstripped his substantially reduced salary, he had other assets and means
to pay such expenses. In sum, there was substantial evidence in the record
establishing special circumstances that justified the trial court’s denial of
modification.7
In challenging the denial of modification, Scott takes issue with the
trial court’s findings that Scott “maintained sufficient income in late 2019”
that “carried over to 2020” as “available income,” and that the Morgan
Stanley distributions of $977,000 and Scott’s 2020 credit card expenses of
$387,345 could be imputed as income in 2020. In Scott’s view, these findings
erroneously imputed the value of his assets and credit card debt as 2020
income. We see no basis for relief.
7 We acknowledge the trial court did not articulate it was proceeding
pursuant to the discretionary “special circumstances” provision set forth in
section 4057, subdivision (b)(5). Accordingly, we requested and received
supplemental briefing from the parties addressing the relevance, if any, of
the Berger and Sorge decisions to the issues in this appeal. Having carefully
reviewed the record and supplemental briefing, we conclude we may affirm
the trial court’s order denying modification because the court’s findings were
aligned with the type of special circumstances found in Berger and were
supported by substantial evidence. (See Sorge, supra, 202 Cal.App.4th at
p. 645 [finding trial court’s child support decision proper under former § 4058,
subd. (b), despite court’s failure to say it was proceeding under that statute];
see also In re Marriage of Burgess (1996) 13 Cal.4th 25, 32 [ruling may be
upheld on any basis, even if that basis was not actually invoked].)
14
Whether or not it was legally accurate to characterize Scott’s 2019
income as income that “carried over to 2020,” the court could properly impute
income in excess of Scott’s $100,000 salary based on his earning capacity and
the evidence of SCA’s non-operating reserves in 2020 that could have added
to Scott’s salary. (§ 4058, subd. (b)(1).) To the extent Scott suggests the
subject reserves consisted of SCA’s income earned in previous years that was
improperly “double-counted” as income in 2020, he cites no authority
supporting the notion. Moreover, the court could otherwise properly consider
the Morgan Stanley distributions and credit card payments as evidence
supporting its implied finding that it would be “unjust or inappropriate” to
apply the guideline formula under the facts in this case. (§ 4057, subd. (b)(3);
Berger, supra, 170 Cal.App.4th 1070.) All in all, the trial court’s order
advanced the legislative goals of child support by ensuring that Scott pays for
the support of his children according to his ability (§ 4053, subd. (d)); that the
interests of his children are regarded as a top priority (id., subd. (e)); and that
the children share in Scott’s standard of living (id., subd. (f)).
Finally, Scott contends the trial court erroneously failed to consider
section 4057.5, which provides that a new spouse’s income may not be
considered when modifying child support. But the record reflects that Scott
had not raised the issue of section 4057.5’s potential applicability in his
filings supporting the modification request or in his trial brief, even though
Kikianne had consistently argued that the totality of the Morgan Stanley
assets, distributions, and credit card payments are properly considered for
denial of modification. It was only after the long cause hearing that Scott
contended, in his closing brief, that 50 percent of the balances in the Morgan
Stanley accounts he held for SCA or with his current spouse should be
excluded in determining his available income. When the trial court issued its
15
proposed decision in Kikianne’s favor, Scott for the first time cited section
4057.5. The trial court was not swayed, noting that Scott had offered no
detailed evidence of his current spouse’s income or assets.
Scott points to no evidence contradicting the court’s finding. Indeed, it
must be remembered that Scott was the party seeking to change the status
quo. It was therefore his burden to prove his circumstances had so changed
that he lacked the ability and opportunity to meet his child support
obligations from whatever fractional portion of his earning capacity and the
Morgan Stanley accounts he believed would be appropriate. (See Usher,
supra, 6 Cal.App.5th at pp. 357–358.) This he did not do.
B. Attorney Fee Award
The trial court’s proposed statement of decision indicated that, based
on a provision in the parties’ marital settlement agreement, Kikianne was
“the prevailing party” and “entitled to an award of attorney’s fees in the
amount of $123,909 incurred for this litigation.” Scott objected to the
proposed award on two grounds: (1) the court incorrectly concluded that the
attorney fee clause in the marital settlement agreement provided a basis for
the proposed attorney fee award and (2) the proposed award incorrectly
included hours expended in different proceedings. Upon considering Scott’s
objections, the court awarded Kikianne $123,909 in attorney fees based on
section 271 and found the award did not impose “an unreasonable burden”
against Scott, given his financial condition.
Section 271 permits a trial court to impose an award of attorney fees
and costs as a sanction where a party’s conduct “frustrates the policy of the
law to promote settlement of litigation and, where possible, to reduce the cost
of litigation by encouraging cooperation between the parties and attorneys.”
(§ 271, subd. (a); Featherstone v. Martinez (2022) 86 Cal.App.5th 775, 783.)
16
An award of attorney fees may be imposed under section 271 only after notice
and an opportunity to be heard is provided to the party against whom the
sanction is proposed. (§ 271, subd. (b).) Courts may not award a sanction
that “imposes an unreasonable financial burden” on the sanctioned party.
(Id., subd. (a).) We review such awards for abuse of discretion.
(Featherstone, at pp. 783–784.)
On appeal, Scott has dropped his contention below that the attorney fee
award incorrectly included hours expended in different proceedings. Instead,
he advances the following three grounds for reversing the award: (1) the
award was dependent upon the court’s erroneous denial of his modification
motion; (2) the court was powerless to award section 271 sanctions because
Kikianne disclaimed reliance on that statute in favor of other bases for
attorney fees; and (3) the court lacked sufficient evidence to impose section
271 fees because counsel for Kikianne submitted a conclusory declaration
that did not set forth his hours, hourly rates, or a description of his services.
We are not persuaded.
We may quickly dispose of the first two grounds. First, we have
determined that the trial court’s order was not erroneous. Second, as a
factual matter, Kikianne’s trial brief expressly sought the same attorney fees
under sections 271, 2030, 2032, and 3557, and she never disclaimed reliance
on section 271. Though her closing brief requested a hearing on section 271
sanctions, her trial and closing briefs explicitly requested the same attorney
fees under all four statutes. Notwithstanding his contention that the
requested hearing would have provided him due notice and a full opportunity
to be heard on the matter, Scott does not claim he was actually deprived of
due notice and an opportunity to be heard. Indeed, each party requested
section 271 attorney fees against the other, and Scott’s briefs did in fact
17
argue that his conduct did not warrant sanctions but that Kikianne’s conduct
did. At the long cause hearing on Scott’s modification request, neither
Kikianne nor Scott disputed the trial court’s statement that attorney fees
were at issue. On this record, we conclude that Kikianne did not disclaim
reliance on section 271 and that Scott had ample notice and opportunity to
oppose such sanctions.
Scott’s final complaint is that counsel for Kikianne did not provide
sufficient information to support the trial court’s award of $123,909. This,
too, is unavailing.
Contrary to Scott’s suggestion, In re Marriage of Duris & Urbany
(2011) 193 Cal.App.4th 510 (Duris) does not compel a reversal of the fee
award. In that case, the trial court held a scheduled hearing on the
appellant’s motion to modify child support, in which the appellant appeared
in propria persona. (Id. at p. 512.) Without previous notice having been
given, the court raised sua sponte the issue that the appellant’s former
counsel had unnecessarily filed an earlier discovery motion. (Id. at pp. 512,
514.) The court summarily imposed sanctions at the hearing, even though
the unrepresented appellant “had no opportunity to subpoena [her former
counsel] to explain the reasons for filing the discovery motion” (id. at p. 514)
and even though the respondent’s counsel had filed no declaration setting
forth his hours, hourly rate, a description of his services or what the
respondent paid as fees (id. at p. 515). Because the appellant was precluded
from presenting evidence challenging the basis for the sanctions and the
reasonableness of the respondent’s counsel’s fees and hourly rates, Duris held
the award was “not consistent with due process procedural protections.”
(Ibid.)
18
The situation here stands in sharp contrast. Scott was an attorney who
had counsel representation, and he knew from Kikianne’s trial brief that she
was seeking $123,909 in attorney fees under sections 271, 2030, 2032, and
3557. Kikianne’s brief explained the requested amount included fees for
counsel’s time in defending against Scott’s modification request and for
pursuing her child support and breach of fiduciary duty claims. She also
elaborated that she and her counsel had been forced to deal with 55 special
interrogatories and over 50 document production demands propounded by
Scott and that 14 hours were spent preparing for and attending her
deposition. Additionally, her counsel had to respond to Scott’s motions to
quash trial subpoenas, file motions to join SCA in the action, and engage in
“many other legal maneuvers . . . due to Scott’s overly litigious nature.” To
support Kikianne’s attorney fee request, her counsel submitted a declaration
with Kikianne’s closing brief stating that Kikianne had “incurred a total of
$125,456” in attorney fees for defending against Scott’s request for
modification of spousal and child support ($68,288.30) and for pursuing her
breach of fiduciary duty claim ($57,168). Thus, unlike the situation in Duris,
the trial court’s award is supported by an attorney declaration specifying
both the fee amount and the matters for which fees had been incurred.
Though additional information regarding counsel’s hours and billing
rate could and should have been provided, Scott had every opportunity and
incentive to raise that issue in his trial briefing and at the long cause
hearing, but he did not do so. Indeed, Scott himself sought section 271
sanctions of $75,000 in his closing brief to compensate him for the fees and
costs he incurred only on the modification matter. That sum exceeded the
$68,288.30 that Kikianne requested for her counsel’s services in opposing
modification. Because Scott could have challenged the lack of billing details
19
supporting Kikianne’s $123,909 request but did not, and because there was
no question the course of litigation was protracted, with numerous motions,
cross-motions, and oppositions filed throughout, the trial court could properly
have determined the requested fees were reasonable in amount.
For all the foregoing reasons, we see no basis for reversing the attorney
fee award.
DISPOSITION
The judgment is affirmed. Costs of appeal are awarded to respondent
Kikianne Cole.
_________________________
Fujisaki, J.
WE CONCUR:
_________________________
Tucher, P.J.
_________________________
Rodríguez, J.
Cole v. Cole (A163975)
20
21
Trial Court: Contra Costa County Superior Court
Trial Judge: Hon. Benjamin T. Reyes
Counsel: Katz Appellate Law, Paul Katz for Plaintiff and Appellant
Law Offices of Martin Glickfeld, Martin Glickfeld; Siefert,
Murken, Despina, James H. Nathan for Petitioner and
Respondent
22