IN RE: the MARRIAGE OF John H. and Edie M. ELFMONT.

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Court of Appeal, Second District, Division 5, California.

IN RE: the MARRIAGE OF John H. and Edie M. ELFMONT. John H. ELFMONT, Appellant, v. Edie M. ELFMONT, Respondent.

No. B052408.

Decided: February 17, 1994

Olsen & Olsen and Neil A. Olsen, Torrance, for appellant. Dennis R. Dubrow, Los Angeles, for respondent.

Appellant John H. Elfmont appeals from a judgment of dissolution of marriage.   His sole contention on appeal is that the trial court erred in awarding a portion of his disability insurance benefits to respondent Edie M. Elfmont as community property under the authority of In re Marriage of Saslow (1985) 40 Cal.3d 848, 221 Cal.Rptr. 546, 710 P.2d 346.   We find Saslow inapplicable to the facts of this case and reverse.

FACTS

Appellant and respondent were married on November 9, 1975.   At that time, appellant was 36 years old and a medical doctor specializing in obstetrics and gynecology.   Appellant had never previously been married.   Respondent was a 32–year–old registered nurse with two minor children from a former marriage.

In 1977, appellant incorporated his private medical practice, established a corporate pension and profit sharing plan and purchased $3,500 per month in disability insurance.   The disability insurance premiums were paid by the professional corporation.

A daughter was born to the marriage in 1978 and a son in 1979.   In 1980, appellant injured his back while playing with his daughter.   By this time, he also had become extremely dissatisfied with the practice of medicine and was determined to retire by age 50.   In spite of his back injury, appellant continued to work in his profession.

In 1980, appellant increased the disability insurance policy limits to $4,000 per month and in 1983, increased the policy limits to $5,000 per month.   In 1982, appellant purchased an additional disability insurance policy with policy limits of $2,000 per month.   In 1984, appellant purchased a third disability insurance policy with policy limits of $2,000 per month.   Appellant's disability insurance coverage in the three policies totalled $9,000 per month.   The corporation continued to pay the premiums.

Appellant and respondent separated on May 1, 1987.   By this time, appellant was grossing approximately $450,000 per year and was contributing approximately $60,000 per year to his pension and profit sharing plan.   The pension and profit sharing plan had assets of approximately $600,000.

Commencing in 1987, after the date of separation, appellant began to pay the disability insurance premiums directly out of his separate property.   The corporation no longer paid the premiums.   Appellant became disabled as a result of further injury to his back.   On December 31, 1989, at the age of 50, he sold his medical practice and began to receive disability insurance benefits pursuant to his policies in 1990.

PROCEDURAL BACKGROUND

Appellant filed a petition for dissolution of marriage on August 17, 1987.   The dissolution was contested.   Trial commenced on January 22, 1990, and continued through February 1, 1990.   On that date, a judgment of dissolution was awarded.   In relevant part, the trial court divided the community assets including the family residence, appellant's pension and profit sharing plan and the proceeds from the sale of appellant's medical practice.

With respect to the disability insurance benefits, the trial court made the following orders.   The $5,000 disability insurance policy was 20 percent community property and 80 percent separate property.   This apportionment was made on the basis that, as of the time of his back injury in 1980, appellant intended to use the disability insurance benefits to allow him to retire at age 50 instead of normal retirement age.   Accordingly, the $4,000 per month of disability insurance purchased prior to that determination was appellant's separate property and the $1,000 purchased after that date was community property.   The two $2,000 disability insurance policies were entirely community property.   Accordingly, respondent was awarded her community property share of the $9,000 monthly benefits, i.e., $2,500, leaving appellant with $6,500.   Appellant was also ordered to pay respondent $2,000 per month in child support.   Thus, the net effect of these orders was to award each party 50 percent of appellant's $9,000 disability insurance income, i.e., $4,500 per month.

DISCUSSION

 Relying on our Supreme Court's decision in In re Marriage of Saslow, supra, 40 Cal.3d 848, 221 Cal.Rptr. 546, 710 P.2d 346, the trial court determined that the increase in disability insurance obtained after appellant determined to use the disability insurance for early retirement was community property.   We conclude the trial court has misapplied the holding of Saslow and extended it beyond its facts.

The question presented in Saslow was described by the Supreme Court as follows:  “Where disability insurance policies are purchased during marriage with community funds, but the benefits are received after the parties have separated, are the benefits the separate property of the disabled spouse?”   (In re Marriage of Saslow, supra, 40 Cal.3d at p. 854, 221 Cal.Rptr. 546, 710 P.2d 346.)   During his 18–year marriage, Dr. Ernest Saslow purchased several disability insurance policies payable upon his disability.   The disability insurance premiums were paid entirely out of community funds.   Dr. Saslow did not invest in any retirement or pension plan.   In 1972, at the approximate age of 52, Dr. Saslow was disabled by longstanding psychological problems.   He began to receive benefits under the disability insurance policies.   Dr. Saslow separated from his wife in 1975.   The wife suffered from Hodgkin's disease.

The Supreme Court held:  “[T]he trial court [should] treat disability benefits as separate property insofar as they are intended to replace postdissolution earnings that would have been the separate-property income of the disabled spouse, and treat the benefits as community property insofar as they are intended to provide retirement income.”  (In re Marriage of Saslow, supra, 40 Cal.3d at pp. 860–861, 221 Cal.Rptr. 546, 710 P.2d 346.)   Apportionment of the benefits should be determined on the basis of the spouses' actual intent, or if evidence of actual intent is not available, on the basis of “a normal retirement age.”  (Id. at p. 861, 221 Cal.Rptr. 546, 710 P.2d 346.)

In our opinion, Saslow is not controlling in this case for two distinct reasons.   First, Dr. Saslow chose to invest in disability insurance instead of investing in a pension plan.   Appellant, on the other hand, invested up to $60,000 a year in a tax-qualified pension and profit sharing plan, which had a total value of $600,000 at the time in question.   Although such a pension plan is not available for distribution prior to age 591/212, it is available if the participant becomes disabled.1  Thus, there can be no argument in that appellant's purchase of disability insurance was intended to act as a substitute for a retirement or pension plan.   Respondent received her community property share of the pension and profit sharing plan in the dissolution of the marriage.

Second, Dr. Saslow made all payments of premiums on the disability insurance out of community property.   He was actually disabled and began receiving benefits prior to the date of separation.   Appellant, on the other hand, was not disabled and was still working on the date of separation.   After separation, he paid the disability insurance premiums out of his separate property.  Saslow is, by its express terms, limited to the purchase of disability insurance policies with community funds.

Saslow neither establishes nor implies a process to apportion disability benefits on the basis of the portion of the premiums paid from community or separate funds.   The apportionment established by Saslow concerns a division between disability benefits qua disability benefits and disability benefits qua retirement benefits.   There is no question in Saslow that all premiums were paid with community funds.   Thus, in this case, under the rationale of Saslow, if appellant had become disabled during the marriage (and had not funded a substantial retirement plan), the trial court's apportionment between those benefits purchased for purposes of disability (the original $4,000) and those benefits purchased for purposes of retirement (the $5,000 acquired after 1980) would have been correct.  (See also In re Marriage of Donnelly (1983) 142 Cal.App.3d 135, 137, 190 Cal.Rptr. 756, disapproved in In re Marriage of Saslow, supra, 40 Cal.3d at p. 861, fn. 5, 221 Cal.Rptr. 546, 710 P.2d 346 [disability insurance policy paid entirely with community funds, disability occurred during marriage and disability insurance benefits commenced during marriage].)

 A disability insurance policy is for a specified term, generally one year.   Once the term expires, the policy has no value.   Thus each year or period, the disability insurance is purchased anew.  (Compare In re Marriage of Lorenz (1983) 146 Cal.App.3d 464, 467–468, 194 Cal.Rptr. 237 [term life insurance];  accord, Estate of Logan (1987) 191 Cal.App.3d 319, 322–326, 236 Cal.Rptr. 368;  In re Marriage of Spengler (1992) 5 Cal.App.4th 288, 297, 6 Cal.Rptr.2d 764;  contra, In re Marriage of Gonzalez (1985) 168 Cal.App.3d 1021, 1027, 214 Cal.Rptr. 634;  Bowman v. Bowman (1985) 171 Cal.App.3d 148, 159–160, 217 Cal.Rptr. 174.)   At the conclusion of the period covered by the disability insurance policy, the community “has fully received what it bargained for” (Estate of Logan, supra, 191 Cal.App.3d at p. 326, 236 Cal.Rptr. 368), namely, protection against the insured spouse's disability during the specified term.   Unlike life insurance proceeds, however, disability insurance benefits are paid periodically and may commence during the marriage, but continue after separation.   This is precisely the issue confronted in Saslow.   There was no question in Saslow that the disability benefits paid prior to the date of separation were community property.   The question in Saslow was whether those benefits should continue to be community property after the separation.   The issue was whether those payments were more in the nature of income replacement or more in the nature of retirement benefits.   The Supreme Court declined to express a bright-line rule, but rather devised a test based on the actual or implied intent of the spouses.

 Here, the parties separated on May 1, 1987.   Thereafter, appellant paid the disability insurance premiums from separate property funds.   The disability did not occur during the marriage, nor is there any evidence the disability occurred during a term which had been paid for with community funds.   It is important to remember that, as a general rule, disability insurance benefits are not treated as community property.   (In re Marriage of Saslow, supra, 40 Cal.3d 848, 221 Cal.Rptr. 546, 710 P.2d 346.)  Saslow has fashioned a narrow exception to the general rule, which is totally inapplicable to the facts of this case.   Thus, the general rule should be applied.

DISPOSITION

The judgment is reversed.   The case is remanded to the trial court with directions to find all disability insurance policies to be appellant's separate property and to reevaluate child and spousal support in light of this finding.   Costs on appeal are awarded to appellant.

I respectfully dissent.

The trial court in this marital dissolution action determined that part of the husband's disability insurance policy proceeds were community property.   Appellant and petitioner John Elfmont appeals from that portion of the judgment entered by the trial court.   For the reasons set forth below, I would affirm the judgment in part, but would also reverse in part and remand for further proceedings.

FACTS AND PROCEDURAL HISTORY

John and Edie Elfmont were married in 1975 and had a son and daughter, respectively, in 1978 and 1979.   John Elfmont was a physician specializing in obstetrics and gynecology.

In 1977, John Elfmont (husband) bought a disability insurance policy which would pay him $3,500 a month for life, providing he became disabled before age 50.   In 1980, he increased the policy benefit to $4,000 a month.   Husband slipped a disc in his back in 1980 while picking up his two-year-old daughter.

The majority states that the disability occurred after marriage and that there was no evidence the husband's disability occurred at a time when the premiums were paid with community property funds.   While there was conflicting evidence as to husband's knowledge of the existence or extent of the injury at the time, applying as we must the substantial evidence rule, it appears at a minimum that by 1981 he knew he sustained a potentially crippling injury which caused him to suffer constant pain and interfered with his ability to practice obstetric surgery.1

During the ensuing three years or so, husband purchased additional disability insurance policies, adding another $5,000 in monthly benefits to his existing $4,000 benefit.   As part of these additions, husband increased the policy eligibility period above age 50, allowing him to collect if he became disabled by age 60.

During the early 1980's, husband came to detest the practice of medicine and often stated his desire to retire by age 50.   During the same period in which he increased his disability coverage from $4,000 to $9,000 a month and changed the eligibility age from 50 to 60, husband told his wife, respondent Edie Elfmont (wife), that he had heard of another physician who let his back condition worsen to the point that he was able to retire, using his disability policy proceeds for support.

Husband maintained a private pension plan, which would not begin making payments until he reached age 591/212.  Husband said he would “retire by the time I am fifty, come hell, or high water.   I will find a way to retire when I'm fifty.”

In May 1987 husband separated from his wife.   From that time on, the husband continued the disability policies in force, paying the premiums from his separate property funds.   In 1989, husband further injured his back.   In 1990, after turning 50, husband retired, sold his practice and began receiving monthly disability benefits of $9,000.

Based on this evidence, the trial court awarded the initial $4,000 in benefits to the husband as his separate property.   The $5,000 in benefits obtained after his back injury, however, were determined to be community property and divided accordingly.2  The court found that the husband made separate property payments totalling $7,850 for disability premiums and ordered that the community reimburse him in that amount.   Husband appeals from that portion of the judgment.

DISCUSSION

The characterization of disability benefits received after separation as either community or separate property has evolved considerably over the past 20 years.   In In re Marriage of Jones (1975) 13 Cal.3d 457, 461, 119 Cal.Rptr. 108, 531 P.2d 420, the court held that a military disability pension received by an ex-serviceman, who had not acquired a vested right to retirement pension benefits, was his separate property.

The rationale underlying Jones was later eroded by In re Marriage of Brown (1976) 15 Cal.3d 838, 851, 126 Cal.Rptr. 633, 544 P.2d 561, which announced a new rule that even non-vested pension benefits were community assets.   The Jones court had also characterized disability payments as more analogous to personal injury damages than to retirement pay.  (In re Marriage of Jones, supra, 13 Cal.3d at pp. 462–464, 119 Cal.Rptr. 108, 531 P.2d 420.)   Once Civil Code section 5126 was amended in 1979 and classified personal injury damages from a cause of action which arose during marriage as community property, another underpinning of Jones was removed.  (In re Marriage of Saslow, supra, 40 Cal.3d 848, 857, 221 Cal.Rptr. 546, 710 P.2d 346 (hereafter Saslow ).)

The proper characterization of a disability retirement pension was discussed again in In re Marriage of Stenquist (1978) 21 Cal.3d 779, 148 Cal.Rptr. 9, 582 P.2d 96 (hereafter Stenquist ).   The husband in Stenquist had lost a limb but remained in military service for 17 more years.   When he retired, he was eligible for either a standard, longevity retirement pension or a disability pension which paid 10 percent more.   Assuming he would prefer to receive more, the Army paid him disability benefits.

The husband and his wife divorced afterward and the trial court ruled that the amount of his disability pension which equaled his retirement pension was community property.   The amount of disability benefits which exceeded what he would otherwise have received under a longevity pension were separate property.

In affirming, the Supreme Court held that the election to receive a disability pension could not defeat the community's interest in the husband's longevity pension, since such a result would “violate the settled principle that one spouse cannot, by invoking a condition wholly within his control, defeat the community interest of the other spouse.”  (Stenquist, supra, 21 Cal.3d at p. 786, 148 Cal.Rptr. 9, 582 P.2d 96.)   The wife would otherwise be unjustly deprived of a valuable property right “ ‘simply because a misleading label has been affixed to [the] husband's pension fund benefits.’ ”  (Id. at pp. 786–787, 148 Cal.Rptr. 9, 582 P.2d 96.)

The Stenquist court also held that the purpose of a military disability pension was in part to compensate the veteran for lost earnings and personal suffering and to that extent was separate property.   Even so, the court ruled that a disability pension received later in life might function principally as a retirement pension.  (Stenquist, supra, 21 Cal.3d at pp. 787–788, 148 Cal.Rptr. 9, 582 P.2d 96.)   Accordingly, the court held that the “primary objective” of the husband's disability pension was to provide retirement support and the portion which equaled the regular retirement benefits was community property.  (Id. at pp. 788–789, 148 Cal.Rptr. 9, 582 P.2d 96.)

The Stenquist rationale was extended to individually purchased disability insurance proceeds in Saslow, supra.   The husband in Saslow was a private practice physician with a long-standing history of psychological problems.   Those problems eventually became disabling and he was forced to retire in 1972.   The husband did not invest in a retirement plan but had purchased extensive disability insurance.   Saslow separated from his wife in 1975 and the trial court handling their subsequent dissolution proceeding ruled the disability benefits were separate property.

The Supreme Court reversed, declining to use an all or nothing approach by which such benefits would always be either community or separate property.   Instead, the court adopted Stenquist's “purpose analysis” in determining the intent behind the disability insurance:  “The approach taken by this court in Stenquist provides for the most equitable distribution of disability insurance benefits.   This approach requires that the trial court treat disability benefits as separate property insofar as they are intended to replace postdissolution earnings that would have been the separate property income of the disabled spouse, and treat the benefits as community property insofar as they are intended to provide retirement income.

“․

“Apportionment of the benefits need not be arbitrary or speculative.   The court may consider testimony of the spouses' intent, both at the time the disability insurance was originally purchased and at the times that decisions were made to continue the insurance in force rather than let it lapse.”   (Saslow, supra, 40 Cal.3d at pp. 860–861, 221 Cal.Rptr. 546, 710 P.2d 346, fn. omitted.)

If there is no evidence of actual intent, the court can fix a normal retirement age at which the disabled spouse would have most likely retired in the absence of the disability.   Factors to be considered in such a case include the age at which persons in the disabled spouse's profession normally retire, the retirement age provided in either federal or private pension plans, and the nature of the disability policies at issue.  (Saslow, supra, 40 Cal.3d at p. 861, 221 Cal.Rptr. 546, 710 P.2d 346.)

The trial court was directed to determine on remand the extent to which the disability policies were intended to provide retirement protection to both parties in their later years.  “The evidence indicates that rather than investing in a retirement plan, the husband chose to utilize community funds to purchase extensive disability coverage.   With his long history of psychological problems, he may have been aware that he might not be able to continue the practice of medicine due to his disability.  [¶]  There is no evidence that at the time the policies were purchased the parties contemplated dissolution.   The husband may have chosen to protect the community's financial future through disability insurance rather than a retirement pension.   Thus, the trial court may determine that the disability benefits in this case are entirely community.”  (Saslow, supra, 40 Cal.3d at p. 862, 221 Cal.Rptr. 546, 710 P.2d 346.)   On the other hand, the court might determine that at least some part of the benefits was intended as a substitute for the husband's future preretirement income and to that extent is separate property.   (Ibid.)

While such determinations may be difficult to make, “trial court judges have extensive experience in” doing so.  “The task is not so formidable that a simple, but inequitable, rule would be preferable.”  (Saslow, supra, 40 Cal.3d at p. 861, 221 Cal.Rptr. 546, 710 P.2d 346.)

The majority here points to the existence of a separate retirement pension as a critical distinguishing factor from Saslow.   Because the husband had provided for his retirement needs, the majority contends Saslow is inapplicable.

I believe the non-existence of a pension in Saslow is not determinative but was instead one of several factors which the court considered in trying to ascertain the husband's intent.   The Saslow court made it clear that determining the intent of the parties would turn on the facts of each case and relied on the trial courts to make those determinations.

For that reason I believe it is a distinction without a difference.  Saslow directs us to consider the intent of the parties when the policies were purchased and continued in force.   The evidence here showed that the husband was aware of his back injuries when he increased his coverage, that he hated the practice of medicine, that he wanted to retire by age 50, and that he had heard of another physician who had done so through a disability policy.   Just as the husband in Saslow was aware that his psychological problems might eventually become disabling, the husband here was aware that his back problems might do the same.   While the husband in Saslow had no pension plan at all, the husband here had no pension plan to rely on until nine years after he planned to retire.   Based on this evidence, it is reasonable to infer that the husband needed to bridge the gap between his intended retirement age of 50 and the start of his pension benefits at age 591/212.

The majority does not challenge these findings, which are amply supported by substantial evidence.   While the majority correctly states that the husband could have drawn his pension benefits early because of his disability, it ignores his clear testimony at trial that he refused to do so.3  The husband's testimony thus bolsters the conclusion that he intended some portion of his disability benefits to bridge the gap between his actual, intended retirement age of 50 and the normal start of his pension benefits at age 59.

The majority also points to the fact that the disability policies were paid from husband's separate funds for nearly three years after separating from his wife.   This is a troubling distinction and one not so easily resolved.

The husband in Saslow had paid his disability premiums from community funds and began to receive benefits for three years before separating from his wife.   The question posed by the court was:  “Where disability insurance policies are purchased during marriage with community funds, but the benefits are received after the parties have separated, are the benefits the separate property of the disabled spouse?”  (Saslow, supra, 40 Cal.3d at p. 854, 221 Cal.Rptr. 546, 710 P.2d 346, italics added.)   In rejecting an all or nothing approach by which disability benefits would be either all separate or all community property, the court again posed the question in terms of “disability policies which are purchased with community funds.  ․” (Id. at p. 860, 221 Cal.Rptr. 546, 710 P.2d 346, italics added.)   The court concluded by holding that the “community property interest in benefits from a disability insurance policy purchased during marriage with community funds must be determined according to the analysis used by this court in [Stenquist ].”  (Saslow, supra, 40 Cal.3d at p. 869, 221 Cal.Rptr. 546, 710 P.2d 346.)

The boundaries of Saslow have yet to be construed or expanded by any reported decision.   While that court considered the community's interest in disability insurance purchased exclusively with community funds, the spirit and language of its opinion provide some guidance in this case, where part of the policies were originally intended to serve a retirement purpose and were initially purchased with community funds, then continued in force by separate property funds after the spouses separated, with the insured spouse receiving benefits after that time.

The Saslow court adopted the reasoning and rationale of Stenquist, which treated disability pensions the same as retirement pensions when the former was selected over the latter by the retiring spouse:  “․ [S]ince all or a portion of such disability payments may serve a retirement function, their characterization as the separate property of the disabled spouse would often ‘ ‘deprive [the nondisabled spouse] of a valuable property right simply because a misleading label has been affixed to [the disabled spouse's] pension fund benefits.’ ' ”  (Saslow, supra, 40 Cal.3d at p. 860, 221 Cal.Rptr. 546, 710 P.2d 346, quoting Stenquist, supra, 21 Cal.3d at pp. 786–787, 148 Cal.Rptr. 9, 582 P.2d 96.)

The net result of Saslow can thus be summarized as follows:  Where disability insurance is purchased during marriage with community assets, with the intent that the policy benefits act as retirement income, then those benefits are community property and are to be treated the same as any retirement pension.

In accordance with Saslow, the trial court here has already properly determined that $5,000 of the $9,000 monthly disability benefit received by the husband was intended to function as retirement income.   If the husband had become disabled and retired before the date of separation, it is clear that the wife would have an equal community property interest in that portion of the husband's benefits.

I see no good reason to strip the wife of her valuable community property right simply because the husband first received disability benefits after separation.   Instead, the disability policies should be apportioned the same as any other retirement pension.   The amount of community assets used to pay the premiums should be compared with the amount of separate property assets used to pay the premiums, with the benefits received apportioned accordingly.4  In other words, if 50 percent of the total premiums used to purchase the $5,000 in benefits intended to function as retirement income came from community assets and 50 percent was paid from the husband's separate property, then the wife has a community property interest in half of the $5,000 in benefits.   In this case, husband had a fully funded pension plan to become effective at age 591/212.  Because the disability benefits are only intended to fill the gap until the husband begins to receive pension benefits, however, the former should lose their community property status once the latter takes effect.

By this result we would honor the intent behind Saslow:  to protect the nondisabled spouse's valuable property right in benefits intended to provide retirement income and to provide for the equitable distribution of property, according to “ ‘the protective philosophy of the community property law as set out in previous decisions of this court.’ ”  (Saslow, supra, 40 Cal.3d at pp. 859–861, 221 Cal.Rptr. 546, 710 P.2d 346, quoting Stenquist, supra, 21 Cal.3d at p. 782, 148 Cal.Rptr. 9, 582 P.2d 96.)   Under this approach, we would abide by Saslow's direction to follow Stenquist's purpose analysis in characterizing and dividing “[t]he community property interest in benefits from a disability insurance policy purchased during marriage with community funds․”  (Ibid., 40 Cal.3d at p. 869, 221 Cal.Rptr. 546, 710 P.2d 346.)

At the same time, however, once the parties separated, the husband's decision to continue the disability insurance policies in force could not have been “intended to provide retirement protection to both parties in their later years.”  (Saslow, supra, 40 Cal.3d at p. 862, 221 Cal.Rptr. 546, 710 P.2d 346.)   Instead, the primary purpose behind that decision would be to compensate the husband for his lost earnings as a result of his disability.   (Id. at p. 860, 221 Cal.Rptr. 546, 710 P.2d 346.)   The resolution I suggest would also protect that separate property interest.5

The majority would limit Saslow to its facts, but precedent is protean, not static.   Especially so in a decision which has made as its linchpin the intent of the parties as determined by the facts.   Because no reported decision has yet interpreted Saslow, we have struggled with the difficult issues presented and it may be appropriate for the Supreme Court to revisit that decision.

FOOTNOTES

1.   We are aware that the definition of disability is defined much more narrowly for tax-qualified pension plan purposes.   Under the disability insurance policies, appellant need only be unable to practice his medical specialty;  while disabled for pension plan purposes is defined to mean unable to work at any occupation.  (26 U.S.C. [Int.Rev.Code] § 72(m)(7) and (t)(2)(A)(iii).)

1.   A finding that certain assets are community property is binding on this court if supported by substantial evidence.  (In re Marriage of Saslow (1985) 40 Cal.3d 848, 863, 221 Cal.Rptr. 546, 710 P.2d 346.)   Since the Husband waived his right to a statement of decision, we must presume that the trial court made all factual findings needed to support the judgment:  the necessary findings will be implied and the only issue on appeal is whether there is substantial evidence to support those findings.  (Michael U. v. Jamie B. (1985) 39 Cal.3d 787, 792–793, 218 Cal.Rptr. 39, 705 P.2d 362.)

2.   The majority characterizes this order as having the net effect of dividing the monthly $9,000 disability benefit equally between the parties.   I disagree with this characterization and believe it reads more into the order than is actually there.   While the combined total of child support and the wife's share of the disability benefits happens to equal $4,500, they are entirely distinct from each other.   To be clear, the trial court gave the wife one-half of the $5,000 in monthly disability benefits determined to be community property, for a total of $2,500.   The husband received $6,500 a month, $4,000 as his separate property and the rest as his share of the benefits determined to have been purchased for retirement purposes.

3.   The majority's citation in footnote 1 to portions of the Internal Revenue Code is therefore not relevant.   It also refers to matters which were not part of the record on appeal.

4.   In dividing the ordinary pension, the court awards as community property that portion which accrued during the marriage as a result of community efforts.  (In re Marriage of Brown, supra, 15 Cal.3d at p. 845, 126 Cal.Rptr. 633, 544 P.2d 561;  In re Marriage of Pace (1982) 132 Cal.App.3d 548, 551, 183 Cal.Rptr. 314.)

5.   As noted earlier, the disability benefits would lose their community property character and become the Husband's separate property once he begins to collect under his pension plan.

GRIGNON, Acting Presiding Justice.

ARMSTRONG, J., concurs.

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