LEUPE v. LEUPE

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District Court of Appeal, Third District, California.

LEUPE v. LEUPE.

Civ. 6621.

Decided: January 13, 1942

Carl W. Anderson, of Burlingame, for appellant. J. E. McCurdy, of San Mateo, and J. W. Coleberd, of So. San Francisco, for respondent.

The above action is before the court upon an appeal from an order and judgment modifying the terms of an interlocutory decree of divorce granted in an action between the parties hereto and from that portion of the final decree of divorce incorporating the terms of the order modifying the terms of the interlocutory decree and an appeal from the order denying alimony, costs, and counsel fees on appeal.

The matter of the alleged abuse of discretion upon the part of the trial court is involved and, therefore, a more complete statement of the facts is deemed necessary than would otherwise be required.

It appears that prior to the 23rd day of March, 1937, an action was commenced by Louis Leupe, as plaintiff, against his wife, Marie Leupe, as defendant, for a divorce. The defendant answered and filed a cross–complaint. The case came on for trial on the 23rd day of March, 1937, and was regularly continued from time to time to April 21, 1937, at which time it was tried. The plaintiff, respondent herein, did not appear in person but appeared by his attorney, Francis W. Murphy. Defendant, appellant herein, appeared personally and by her attorney, Carl W. Anderson. Upon the trial no evidence was offered on behalf of plaintiff. Evidence was offered on behalf of defendant in support of the allegations contained in her cross–complaint. On written stipulation, findings of fact and conclusions of law were waived and an interlocutory decree of divorce in favor of defendant and cross–complainant was granted upon the ground of extreme cruelty.

The interlocutory decree provided that plaintiff should pay to defendant the sum of $100 for additional counsel fees, payable in installments; that plaintiff pay to defendant the sum of $1,500 as and for her interest in the personal property and business conducted by the plaintiff in Burlingame, San Mateo County, California, said personal property being particularly described; that said sum of $1,500 should be paid in sums of $25 per month commencing May 1, 1937, until paid in full, and that said payment of $1,500 should be secured by a lien upon the personal property mentioned, said personal property being awarded to said plaintiff subject to a lien in favor of defendant in the sum of $1,500, said personal property to be charged with said lien for said sum, and that in the event plaintiff should fail to pay said installments, then and in that event, upon five days' notice in writing to plaintiff, defendant might apply for an order of sale to be issued to sell said personal property to satisfy said lien.

It was further ordered that plaintiff be required to pay to defendant the sum of $50 per month, commencing May 1, 1937, for the maintenance and support of said defendant, and, further, that upon the completion of the payment of said $1,500 by plaintiff to defendant, that said plaintiff should pay to defendant the sum of $75 per month for her maintenance and support.

This interlocutory decree was approved by Francis W. Murphy, plaintiff's attorney, before signing and filing. Thereafter J. E. McCurdy was substituted in place of Francis W. Murphy as attorney for plaintiff. Following this substitution, notice was served upon defendant and her attorney stating that on Monday, May 23, 1938, plaintiff would move the court for an order modifying the interlocutory decree of divorce entered on May 17, 1937, by striking therefrom the provision requiring the payment to defendant of any further moneys under or pursuant to said interlocutory decree. Accompanying the motion was an affidavit by plaintiff stating that theretofore and on May 17, 1937, an interlocutory decree of divorce was entered in said action in favor of defendant and against plaintiff, said interlocutory decree being referred to; that affiant did not know that a hearing in said matter was to be had on April 21, 1937, and was not present in court and did not consent to the terms of the interlocutory decree and the payments therein ordered to be made by said court, and had no knowledge of the terms and conditions thereof until after the entry of said decree; that in compliance with the terms of said interlocutory decree, plaintiff has paid to defendant and deposited with the Bank of America, Burlingame Branch, the sum of $75 per month each and every month since the entry of said decree; that the total sum of $900 has been paid by said plaintiff and cross–defendant since the entry of said decree, and that the total sum of $900, so affiant is informed and believes and therefore alleges, is on deposit with said Bank of America, Burlingame Branch. That none of said money has been necessary for the care, maintenance, and support of said defendant, and said defendant is amply provided for and does not need any care, maintenance, or support from the said plaintiff; that because of business depression and labor troubles, the business of said affiant has practically disappeared and since the 1st day of January, 1938, said affiant has been unable to do sufficient business and collect the money therefor to make any profit; that affiant has a machine shop in Burlingame, California, and some of the machinery and equipment therein contained is being purchased under contract of sale and there is still due and to be paid on said machinery and equipment approximately the sum of $800 in twelve installments of $68.30 a month; that affiant is not able to earn sufficient money to pay said monthly installments as they become due and that affiant will lose said machinery and equipment and will be obliged to discontinue business; that the net value of the personal property owned by plaintiff was never the sum of $1,500 and the machinery and equipment of affiant as set forth in said interlocutory decree should be discharged of any lien for the payment of said sum from said plaintiff to said defendant.

This motion was partially heard on May 23, 1938. When the action was called on the calendar defendant's attorney moved the court for an order for counsel fees and costs in defense of the motion about to be heard upon the ground that defendant had no funds with which to compensate her counsel or pay costs of a defense of said motion.

At said hearing plaintiff was called as a witness and testified that he was the plaintiff and operated a machine shop on Highland Avenue known as Louie's Machine Shop; that he had had considerable difficulty with the unions; that his business was very bad; that he was unable to make the payments as required under the terms of the interlocutory decree; that he had made all of the payments to date as required under the terms of said decree; that he paid out the sum of $61.03 on account of contracts of sale on equipment he was purchasing; that he owed approximately $700; that if he had not won $1,000 in a lottery he could not have made the payments as required in the decree. He also won a Chevrolet car in a theatre drawing; he made $1,852.42 in 1937 from his machine shop; he paid Mrs. Leupe $900 since the entry of the decree and she still has said money on deposit in the bank; his wife is a business woman and managed an apartment house in Seattle; that he had a bookkeeper and his books showed he actually lost $40 from January 1, 1938, to May 1, 1938.

On cross–examination he testified that Mrs. Leupe borrowed $800 from Margee Pansky and A. H. Barlin, and her brother, K. F. Pauliet, signed the note with her; he had no money at that time; he was out of work at that time; his wife gave him the $800 and he bought the shop. The note referred to was exhibited to plaintiff and he said that was the note. The note was then offered in evidence.

Plaintiff further testified on cross–examination that he executed a bill of sale of the machine shop to Mrs. Leupe on July 9, 1932. The bill of sale was identified and admitted in evidence. This bill of sale assigns, sells, conveys, and sets over to Mrs. Leupe as her separate property and not a part of the community property, all of his right, title, and interest in and to all machinery, equipment, and fixtures of every kind whatsoever in Louie's Machine Shop at 235 Highland Avenue, Burlingame, California, together with the good will and name and the leasehold interest thereof, and warrants to the buyer the title to said property.

Plaintiff testified further that his wife borrowed additional money to pay their living expenses for awhile because he had not been working; he paid the $800 note to Mrs. Leupe through earnings from the shop; that he did not bring his books for the shop with him; that he had paid Mrs. Leupe $300 on account of the property settlement agreement and $600 on alimony.

The matter was then continued for further hearing to June 27, 1938, at which time R. E. Benson, plaintiff's bookkeeper, was called as a witness for plaintiff and testified that he was the bookkeeper for Louie's Machine Shop and had been such bookkeeper for over a period of two years; that the books showed, in 1937, that Mr. Leupe's net earnings were $1,852.45; that the books show the earnings for the said business this year are less than last year; that the books showed that Leupe is indebted in the sum of more than $700 on conditional sales contracts and that the monthly payments are $61.03.

On cross–examination the witness testified that the total sales for the five months' period, 1937, was $3,104.27; that the total sales for the five months' period, 1938, was $2,569.95; that the labor costs during the five month period of 1937 was $933.96 and the labor costs for the five month period of 1938 was $461.94, and the difference between the total sales for the years 1937 and 1938 is $534.32; that the labor costs for the year 1938 was $472.02 less than 1937; that the difference between the periods for the years 1937–38 is that the actual income for 1938 is the sum of $62.30; that the total sales made for the five month period of 1938 is $2,569.95; that the total costs and outlay for the period is $1,843.84; that $305.15 of this amount was paid for equipment on contract; that the net income for the period from January 1 to May 30, 1938, is $1,032.26.

On re–direct examination he testified that the property in the machine shop had been appraised by machinery men and one appraisal, for purposes of sale, was $2,200, and the other appraisal was for $2,000; and on re–cross examination he testified that for income tax purposes the property was valued at $8,000, and the depreciation for the year 1937 was taken in the amount of $833.97.

In opposition to the motion a counter affidavit by defendant Marie Leupe was presented in which it is alleged that it was not true that Louis Leupe did not know that a hearing on said matter was to be had on April 21, 1937; that on the 19th day of April, 1937, affiant was present in court with all of her witnesses who were to testify at the trial of said divorce action; that said plaintiff was present with two of his witnesses; that at said time the court made its order continuing the trial of said action to ten o'clock a. m. on April 21, 1937, and ordered that all witnesses return at said time; that on the 21st day of April, 1937, plaintiff was not present in court but was represented by his attorney, Francis W. Murphy; that on the 19th day of April, 1937, plaintiff had agreed with his attorney and the attorney for affiant as to the proposed settlement of the property rights of the parties and the amount of alimony to be paid in the event that an interlocutory decree of divorce was granted to affiant; that plaintiff consented to the terms of the interlocutory decree of divorce and the payments therein ordered to be made and did have knowledge of the terms and conditions prior to the entry of said decree; that on June 2, 1937, plaintiff was served with a certified copy of the interlocutory decree of divorce; that since the entry of said interlocutory decree plaintiff had paid to affiant the sum of $75 a month by depositing the same in the Bank of America, Burlingame Branch; that a total sum of $900 had been paid by plaintiff since the entry of the interlocutory decree and that $600 of said sum had been paid on account of the property interest of affiant, and the sum of $300 had been received by affiant for her care, maintenance, and support; that affiant did not have on deposit in the Bank of America, Burlingame Branch, the sum of $900.

That prior to the granting of the interlocutory decree of divorce, affiant was in ill health and extremely nervous, suffering from a heart ailment, and that affiant is still suffering from said heart ailment and unable to engage in any type of work to earn her living; that the sum of $25 a month is grossly inadequate to provide for the care and support of affiant, and that affiant has been forced to use the moneys awarded to her under the terms of the decree as her interest in the property of the parties herein for her care, maintenance, and support.

That affiant for a long period of time has been suffering from an infected tooth and has not had sufficient means with which to pay for an operation to remove said infected and impacted tooth.

That affiant is informed and believes that said plaintiff has enjoyed considerable business since the granting of said interlocutory decree and has made a large profit therefrom; and said affiant is without sufficient means to compensate her attorney in defense of the motion and prays that the motion of plaintiff be denied, and that an order be made allowing affiant a reasonable sum for her attorney fees and defense of said action.

That thereupon Mrs. Leupe was sworn and testified that she borrowed $800 to buy the shop for Leupe and borrowed $700 more to pay their house rent and something for their living; that she had one dollar in the bank and about one dollar in her purse, and that she has no other money or resources or income than the payments made by her husband to her; that she had used all of the money her husband had given her, including the $25 a month he was to pay on the property settlement; that she is ill and very nervous, has a bad heart and has fainting spells and cannot do anything to support herself or earn any money for herself; she had to spend money for medicine to relieve the heart condition; she had no money with which to buy clothing; the clothes she had on were all given to her by friends; she needed work done on her teeth and had no money with which to have the work done; she had no money to pay her attorney to defend the motion and had not paid her attorney any money to defend the motion.

On cross–examination she testified that she was managing an apartment house for her brother in Seattle part of the time she was married to Louie; that she was not well enough to manage an apartment house now; that she tried to get employment from the Sisters in Sacramento; she speaks French and thought she could get some work teaching French but she told them about her fainting spells and they would not have her.

Louis Leupe was recalled by defendant for further examination and testified that the only difference between his total sales for the first five months of 1937 and the total sales for the first five months of 1938 was $534.32; that the labor costs for 1938 for the same period was $472.02 less than 1937; that the total sales for the first five months of 1937 was $3,104.27; the total sales for the first five months of 1938 was $2,569.95; his labor costs during the same period for 1937 was $933.96 and his labor costs for the corresponding period for 1938 were $461.91; his labor costs so far this year were $472.02; that the only difference in the income is that the income for the first five months' period of 1938 was $62.30 less; that he won $1,000 in a lottery in 1937 and also a Chevrolet automobile, and he borrowed money on the automobile, about $300; that he had money; that he had $365 in the Bank of America at Burlingame; that he had the property at the machine shop; that he lived at the shop; that the rent for the shop was $35 a month, which rent was charged to the business operation; that his living expenses were about $30 per month.

The matter was submitted and on June 27, 1938, the court made an order modifying the interlocutory decree of divorce as follows: That the personal property interest in said interlocutory decree described shall not be subject to a lien in favor of defendant for the payments to be made by plaintiff; that the interlocutory decree be further modified so that in case plaintiff shall fail to pay the installments set forth in the interlocutory decree that said defendant may not apply for an order to be issued to sell said personal property to satisfy a lien as described in said interlocutory decree; that the said interlocutory decree be modified in regard to the monthly payments to be made to said defendant as follows: That said plaintiff be and he is hereby ordered, adjudged, and required to pay to defendant the sum of $10 per month hereafter and, pending the further order of the court, as and for the care, maintenance, and support of said defendant. It was further ordered that upon completion of the payments of said original sum of $1,500, as provided in said interlocutory decree, that said interlocutory decree be amended so that there shall be no increase in the monthly payments to be made to said defendant for her care, maintenance, and support.

The order modifying the interlocutory decree was filed and entered on July 1, 1938. No notice was given to defendant of the entry of the order. On July 5, 1938, the final decree of divorce was made and entered, and the modified provisions of the interlocutory decree were incorporated therein.

On July 18, 1938, pursuant to an order to show cause why plaintiff should not be made to pay such sums as the court may deem reasonable as and for costs in perfecting her appeal and for such further sums as the court might deem reasonable for attorney's fees for said defendant, the motion for such allowances came on to be heard and was continued to, and finally heard on August 8, 1938. By stipulation all of the proceedings had on the motion to modify the interlocutory decree and the order modifying same, and the final decree, were used on said hearing. In connection with the motion an affidavit by defendant was presented and in which affidavit it is stated that plaintiff has in his possession a great amount of personal property, including the sum of $350 cash, and that defendant has no money or property whatsoever; that plaintiff has sufficient means of his own to pay defendant the sum stated by defendant as costs of appeal and to pay defendant or her attorney a reasonable sum as and for attorney's fees for the prosecution of the appeal.

At the conclusion of the hearing the court denied the motion and dismissed the order to show cause. Within the proper time defendant appealed from this last–named order.

Concerning the grounds of appeal from the order modifying the interlocutory decree, it is the contention of appellant that the court was without authority to order the modification and that the modification of the interlocutory decree was not a proper exercise of the discretion vested in the court in such matters.

It is to be noted that in his affidavit respondent states that he did not know that a hearing was to be had on April 21, 1937; that he was not present in court and did not consent to the terms of the interlocutory decree of divorce and the payments therein ordered to be made by the court, and had no knowledge of the terms and conditions thereof until after the entry of said decree. However, there is nothing in his affidavit to show how long after the entry of the decree he learned about the decree or the terms or conditions thereof. In appellant's affidavit it is stated that on April 19, 1937, she was present in court with her witnesses and that plaintiff was present with his witnesses; that the court continued the trial to April 21, 1937, and ordered all witnesses to return at that time; that on April 21, 1937, respondent was not present but was represented by his attorney, Francis W. Murphy; that on April 19, 1937, respondent had agreed with his attorney and the attorney for appellant to the proposed settlement of the property rights of the parties and the amount of alimony to be paid in the event of the granting of an interlocutory decree, and that respondent consented to the terms of the interlocutory decree and the payments then ordered to be made and had knowledge of the terms and conditions prior to the entry of the decree; and that on June 2, 1937, respondent was served with a certified copy of the interlocutory decree of divorce. There was no specific denial by plaintiff of the service upon him of the certified copy of the interlocutory decree.

Respondent's affidavit states that none of the money has been necessary for appellant's maintenance and support; that she is amply provided for and does not need care, maintenance, and support from said respondent.

Appellant's affidavit specifically sets forth the condition of her health and of her finances. Respondent's affidavit further says that his business has practically disappeared and since June 1, 1938, he had been unable to do sufficient business and collect the money therefor to make any profit. However, the testimony discloses that there was no substantial difference in the proceeds from his business at the time of the granting of the interlocutory decree and the time of the hearing on the motion to modify the decree. It cannot be ascertained from respondent's affidavit whether the machinery which he purchased under conditional sales contract was secured prior to the time when the interlocutory decree was granted or subsequent thereto. The personal property described in the bill of sale hereinbefore referred to was the separate property of appellant.

The court was without authority to award this separate property to respondent without the consent of appellant. In the case of Fox v. Fox, 18 Cal.2d 645, 117 P.2d 325, quoting therefrom, at page 326, it is said: “In an action for divorce, only the community property and the homestead may be awarded; the court is not authorized to assign the separate property of one of the spouses to the other, nor to require one to pay to the other any amount in lieu of an assignment or division of it. Conard v. Conard, 5 Cal.App.2d 91, 41 P.2d 968.” See, also, Allen v. Allen, 159 Cal. 197, 113 P. 160; Heintz v. Heintz, 126 Cal.App. 106, 14 P.2d 317.

The interlocutory decree states that this personal property was awarded to respondent. The court was without authority to make this award without the consent of the appellant.

Whether it be called an award or a transfer, the consideration therefor to appellant was the $1,500, to be paid in accordance with the terms of the decree, the imposition of the lien, and the right to obtain the order of sale in the event of non–payment. The right of the lien and the right of sale were as much a part of the consideration as was the money payment. The respondent, in accepting the property, became bound by the conditions imposed by the interlocutory decree. He should not be permitted to accept and keep the benefit which he received from the transfer of the personal property to him without bearing the burdens attached to the entire consideration. The evidence presented to the trial court at the divorce hearing is not before this court. We must therefore presume that the court acted upon sufficient evidence as to plaintiff's ability to pay and as to appellant's necessities, in providing for the payments for her care, maintenance, and support as provided for in said interlocutory decree.

Also, it is urged that the court, by reason of the lapse of time after the entry of the interlocutory decree and the making of the motion for modification thereof had lost jurisdiction. It may be conceded that the court may not dispose finally of the property rights of the parties, until the entry of the final decree of divorce, but it has been held that where a court does, by its order, make such disposal, its act in so doing constitutes an error of law, which can be remedied only on motion for a new trial or other appropriate motion––or on direct appeal.

In the case of Peis v. Mohr, 126 Cal.App. 300, 14 P.2d 878, 880, it is said: “A trial court should not by interlocutory decree of divorce eo instante assign and dispose of community or homestead property, although it may determine therein how such property shall be ultimately awarded and assigned when the marriage is dissolved by a final decree of divorce; but, if such court by its interlocutory decree does in fact make such determination and award, its act in so doing constitutes an error of law which can be remedied only on seasonable motion for new trial or other appropriate motion or upon direct appeal.”

As the motion to modify the interlocutory decree was not made for more than six months after the entry of such decree and under all of the circumstances herein appearing, we are satisfied that the motion to modify was not made in time, and that as to the property rights attempted to be settled, the trial court was without authority to order the modification.

Generally an attorney is not vested with authority to bind his client in matters affecting property rights. From the evidence before the trial court perhaps an inference could reasonably have been drawn that there was an agreement between the parties settling their property rights but, in the view we take, it is not deemed necessary to determine the question of the authority of the attorney or whether, as a matter of law, there was such an agreement. These matters, in our opinion, are such as the trial court should determine after an opportunity for hearing directed to those questions.

As no substantial difference is shown as to respondent's ability to pay at the time the order modifying the interlocutory decree was made, there is support for the contention that the trial court, in ordering the modification in respect to the alimony, did not exercise a proper discretion. Under the facts herein, the trial court exercised its discretion at the time of the making of the interlocutory decree of divorce providing for the payments for maintenance and support, and the financial circumstances of respondent were substantially the same at the time of the hearing on the motion to modify as they were at the date of the granting of the interlocutory decree. In such matters as this the court has a discretion but there is a definite limit to its exercise and it cannot be arbitrary or capricious. In view of this limitation, the principle set forth in Snyder v. Snyder, 219 Cal. 80, 25 P.2d 403, is applicable herein. In that case it appears that after denial of the motion to modify the interlocutory decree on November 12, 1931, an order was made modifying the interlocutory decree on the same set of facts on February 9, 1932. Therein the court said:

“It is not necessary to determine whether the showing made by defendant on either of the orders to show cause set forth grounds sufficient to authorize the modification of said maintenance order. For it is clear that the court, having denied the application on November 12, 1931, was without authority on February 9, 1932, to alter said decree upon an identical state of facts. It would be incongruous to allow an appealable order to become final and yet to concede the power of a court at a later date, upon the same state of facts, to issue an order nullifying it. The rule of law in this particular is stated in 1 Ruling Case Law, page 948, as follows:

“ ‘Authority to modify the allowance, however, does not include the right to alter the award upon the state of case existing when the decree was entered, or to review the action of the chancellor therein. The parties had their day in court, with the right of appeal if the decree was deemed erroneous, and it cannot be supposed that it was intended that the court should sit in review of its own decrees, or that the same or some succeeding chancellor presiding in the same court should, after the lapse of indefinite time, have power to reverse, alter or modify a decree for alimony upon the facts existing at the time of its entry.’ See, also, to the same effect, 19 C.J. 273. This rule is followed by the District Court of Appeal in Molema v. Molema, 103 Cal.App. 79, 283 P. 956. See, also, a case directly in point decided by the Supreme Court of the state of Idaho, Simpson v. Simpson, 51 Idaho 99, 4 P.2d 345.”

The case of Simpson v. Simpson appears to be directly in point. Therein it is held, under facts similar to those established herein, that authority to modify such a decree can only be exercised upon a showing of material, permanent, and substantial change in the circumstances and conditions of the parties.

In regard to the second appeal, it is to be noted that the motion there involved seeking the allowance for alimony, costs, and counsel fees on appeal was submitted upon the evidence theretofore introduced and the order denying the motion was based thereon. We have hereinbefore held that the order heretofore made modifying the interlocutory decree was erroneous and as to the amounts allowed for maintenance and support, was not a proper exercise of the discretion of the court.

It appears very inconsistent, to say the least, that respondent should, by securing an order modifying the terms of an interlocutory decree and thus render appellant unable to support or maintain herself or to pay her counsel fees and costs of appeal, successfully prevent appellant from securing a review by an appellate court of the order thus sustained. We are satisfied that it was an abuse of discretion on the part of the trial court to deny the motion.

It is ordered that the order modifying the interlocutory decree be reversed and those portions of the final decree incorporating the modifications set forth in the interlocutory decree in pursuance of said order be stricken out, and that an amended final decree be entered as of the date of the original decree, conforming to the provisions of said interlocutory decree as they appeared prior to the making of said order of modification. It is also ordered that the order denying appellant's motion for alimony, costs, and counsel fees on the appeal be, and the same is hereby reversed; and that the trial court fix such amounts as may be found reasonable for costs and counsel fees on appeal.

MONCUR, Justice pro tem.

TUTTLE, J., and THOMPSON, Acting P.J., concurred.