Fay C. MAULDIN, Plaintiff and Respondent, v. Carl L. MAULDIN, Defendant and Appellant.
Pursuant to an order to show cause issued contemporaneously with the filing of the action, a hearing was had on July 24, 1953 with respect to respondent's demand for payment by appellant of alimony, attorney's fees and court costs. Upon the affidavits and testimony received by the court, it made an order for appellant to pay respondent, pendente lite, the following:
Both parties are restrained from alienating community property except in due course of business.
Appellant contends that (1) there was neither proof of respondent's need nor of appellant's ability to pay the moneys; (2) the award for payment of income taxes is contrary to law.
In order fairly to appraise such contentions, it is necessary to review the behavior of the parties prior to the impasse, as disclosed by the evidence. Before the separation in 1952, the parties lived in comparative luxury. For a time they paid out over $2,000 monthly for home maintenance and travel. Such expenditure shows that respondent had been maintained on a standard so high that an order for less than the award made would have been an abrupt reduction of her modus vivendi. During 1952 respondent says she received from appellant $9,200 for the maintenance of her home, her clothes, medical and traveling expenses. Appellant's questionnaire says he paid her as her net income from all sources $12,633.67. However, after bitterness had developed and appellant desired a divorce, he told her he would spend all his assets, throw hers back into the community, get himself into debt, throw the whole thing into bankruptcy and see that neither would have anything.
His subsequent behavior indicates a deep-seated determination to do as he had threatened. From the sale of their ranch in December 1951 to Giffen Inc. they received three notes. Appellant gave respondent a note for $96,770; he retained one of like amount and also a note for $17,600. All three were payable in ten annual equal installments with five per cent interest on the unpaid balance.
In 1952 appellant received the following moneys:
Out of the profit on cotton sales, appellant testified that $30,000 was paid in satisfaction of a loan for crop financing; that $22,000 was dissipated by himself and respondent; that in 1952 he kept an office for his cotton transactions at an expense of $13,166.53, lost $7,528.81 in his speculations, and realized no profit. Such illy designed or reckless outlay of $20,695.34 in one year serves to corroborate respondent's testimony of appellant's threat to defeat his wife in her attempt at survival. While appellant was thus recklessly disbursing his collections in 1952, respondent received only $9,200.
He did no better in 1953. By selling the balance of $14,080 due on the $17,600 note for $10,000, he squandered another $4,080. Also, having received two installments on his $96,770 note, it was reduced to $77,416. Reserving to himself the next installment of $11,546, he sold the balance of $67,739 at a discount of $12,000, or $55,739. Having previously become indebted to his vendee in the amount of $4,500, he received only $51,239. That sum was further reduced by the allowance of $20,000 which he agreed to pay his vendee for a boat. It is thus seen that in 1953 prior to the hearing appellant had collected $40,000 at a sacrifice of over $16,000 besides paying $20,000 for the boat.
In addition to such dissipation of wealth in 1953 prior to the July hearing, appellant used $7,102.04 for his ‘personal drawings'; suffered market and brokerage losses of $5,386.11 and operating losses in the sum of $5,911.54. By adding to those sums $3,450, expenses of his two sons, we derive his total outlay for thay year prior to the hearing, the sum of $21,849.69.
Despite what appears to be wanton and ill-advised expenditures, he still had not accounted for $18,150.31 of his $40,000 collection in 1953 and $19,344.21 of his 1952 collections, or a total of $37,494.52. In fact, his own financial statement of July 1953 shows his community assets worth $76,700. The trial court evidently fairly concluded that if a man can spend over $2,000 monthly on his living expenses and the maintenance of an office where he does no business, he might justifiably pay out comparatively meager sums for the support of his wife pending trial of the case. In view of his unwise disposition of some valuable assets, and reckless expenditures for his own luxury, it was not amiss to require him to pay $250 monthly for respondent's support and reasonable sums for her to be represented by counsel in presenting her cause.
The wife's possession of a separate estate does not bar an order for her support by her husband pending settlement of a domestic controversy. An order for alimony, counsel fees and costs is made at the commencement of a suit to finance its successive steps for a complete presentation and to enable the wife to live in her accustomed style. She is not required to drain her separate estate for such purposes or even to exhaust community funds in her possession before demanding support from her husband. Whelan v. Whelan, 87 Cal.App.2d 690, 692, 197 P.2d 361. Section 137.2 of the Civil Code provides that the chancellor may, in his discretion, require the payment of such money as he may deem necessary for the wife's support. Westphal v. Westphal, 122 Cal.App. 379, 383, 10 P.2d 119. Her possession of property in her own right is merely one circumstance to be considered in determining the necessity for the award. Sweeley v. Sweeley, 28 Cal.2d 389, 391, 170 P.2d 469. That a wife is not obliged to consume her separate estate in suing for divorce is the fair construction of section 137 was held in Spreckels v. Spreckels, 111 Cal.App.2d 529, 244 P.2d 917. Although that lady's separate income was $1,000 monthly, the court upheld an order for the payment of Mrs. Spreckels' counsel fees and the costs of suit with the observation that ‘the trial court was justified in exercising a reasonable precaution to preserve the corpus of the wife's separate estate.’ Id., 111 Cal.App.2d at page 534, 244 P.2d at page 920. Such preservation is rendered important by the nature of a divorced woman's position in our economy. Her lack of training in industry and business, and her years of service in the home, and in caring for her family make her an easy victim of designing persons and of her own miscalculations. Therefore, the law, at the time of the severance of the marriage ties, regards with distrust any factor that is calculated to remove the economic security of an abandoned wife.
There is no formula for the guidance of a court in ordering or in denying alimony and suit money. Each case mush be adjudged according to its facts by the application of equitable principles. In Krieger v. Krieger, 104 Cal.App.2d 488, 231 P.2d 526, cited by appellant, despite the wife's possession of all the cash and liquid assets, it was held that the trial court did not err in requiring the husband to pay her attorney's fees; it did not abuse its discretion.
Because respondent had collected interest on her Giffen note in the amount of $4,364.65 on January 1, 1953 and at the hearing still had $1,368 thereof, appellant complains that a gross injustice was done him by the court's refusal to require her to support herself and finance her lawsuit. The court had to consider (1) that during that seven months appellant paid her nothing, (2) she demanded $452 per month for support, and (3) the plane of living on which appellant had maintained her was too high to warrant a niggardly allowance. He had been prosperous; had been a lavish spender at home and abroad.
The record shows that appellant is able to meet the payments without sacrificing his current holdings. Since the parties came to a parting of the ways, appellant has not only wasted his substance without justification but has made no serious attempt to carry on any business at all. His contention that he cannot forthwith engage in a paying business is not supported by his past record. He is not only familiar with the brokerage business but out of a vast experience in agricultural pursuits and in trading, he is qualified to succeed in moneymaking fields of endeavor. All that he has is community property. Excellent reasons appear why it should be used to finance this lawsuit and to support respondent, pendente lite, rather than for her to consume her own separate property.
Respondent's Income Taxes
Appellant assigns as error that part of the order which requires him to pay $11,000 in income taxes unpaid at the time of the hearing. At the time of the sale of the ranch to Giffen Inc., the income taxes, both state and federal, aggregated in round figures, $22,000. In some way respondent became individually charged with one-half thereof as her personal debt. At the time of the court's order, such sum had not been paid. The court included in its order that appellant pay the $11,000 charged to respondent. On this appeal, appellant contends bitterly that to compel him to make such payment is a gross injustice to him; that it is her debt and that she should pay it with the $14,000 she collected on her $96,770 note in January 1953.
Adequate support of the court's order is found in the following: (1) The $11,000 assessment is a debt of the community estate, which is of course liable for it. Since the community is the debtor, respondent is not liable for its payment out of her separate property. Wilson v. Wilson, 76 Cal.App.2d 119, 128, 172 P.2d 568. (2) Aside from the balance due her on the Giffen note, her total assets are less than $10,600 consisting of stock, a building and loan company deposit of $2,500 and a checking account of $240. Under the authorities already cited, the court was not obliged to require her to pay out her separate funds for her living expenses or to protect community property. A payment of $11,000 would be devastating to respondent's estate. Her future subsistence may depend on her husbandry of her Giffen-note principal. (3) It is incumbent upon a husband after a separation due to his misconduct to maintain his wife on a scale of living substantially as maintained in the past. She is not required first to impair her separate estate. Whelan v. Whelan, supra; Loeb v. Loeb, 84 Cal.App.2d 141, 144, 190 P.2d 246. They had lived extravagantly. (4) On January 1, 1952, appellant collected from Giffen the installment of principal and interest due respondent, and kept it. (5) In 1953 he collected the balances due on his $17,600 and $96,770 notes. The face value of the $96,770 note had by two installments been reduced to $77,000. Reserving the next installment, he sold the balance of $67,000 at a discount of $12,000 and in the bargain, as a part of the $55,000 he took a boat at the price of $20,000—leaving him $30,000 in money for the $67,000 note. He gave no explanation as to why he should accept such a discount or take a boat in trade for a valuable asset. He owed no debt that was urgent, although he discharged a debt of $4,500 he owed the purchaser of the paper.
‘Q. Now, this $30,000 that you got in cash, what did you do with that? A. Paid some obligations we had.
‘Q. What obligations? A. Borrowed money.
‘Q. What? A. Money that had been borrowed.
‘Q. To whom did you pay it? A. I would have to have my books to get all that together.
‘Q. You have testified that you had to sell this note to raise some money. Why did you have to raise any money?’
Appellant had assured respondent at the incipiency of their disagreements that he would get himself in debt, get the total estate in bankruptcy and so manage that neither would ultimately have anything.
(6) Appellant testified that in 1953 he was in debt as follows:
While he paid the debts listed above and bought clothing for Carl in the sum of $300, his expenditures could not be recommended as a model of economy. Withal, he could render no reasonable explanation for his excessive discounts on valuable paper. Notwithstanding his extravagant spending and losses, he left $20,000 unaccounted for.
From such a record it could hardly be said that the trial judge abused his discretion in requiring appellant to advance $11,000 with which to pay a community debt. The transcript does not leave a clear picture as to what assets are still in appellant's possession. But, much or little, it is not unlikely that, if he should be convicted of extreme cruelty, the court might award to respondent all of such community assets. The order for payment now of the $11,000 is not an attempt to make a special award of such sum to respondent. Its advancement for the payment of federal taxes will aid in conserving the entire estate until the interlocutory decree shall be entered. The court then will effect such division of the community property as will be just, having evidence of the expenditures of both parties.
Mrs. Mauldin is in a stronger position than was the plaintiff in Rutledge v. Rutledge, 119 Cal.App.2d 114, 259 P.2d 79, 81, cited by appellant. The Rutledge case involved a division of the community estate after divorce. The husband had, two years prior to the decree, filed two separate income tax returns, listing one half of the community income to himself and the other half to his wife. Subsequent to divorce, the government disallowed certain deductions and assessed a deficiency on both returns. He paid his own deficiency but did not pay that assessed against the wife. They had lived together a year and a half subsequent to the filing of the returns. The ‘divorce dissolved her vested community interest, making all of her property interests ‘separate’ in nature.' Respondent here is not in a comparable position. She acquired ownership by gift of the promissory note. It thereupon became her separate property. As such, it was not liable for a community debt. Hence, the court below could not have deprived her of its ownership in an attempt to enforce payment of a community debt.
The order merely requires appellant to pay the income taxes accrued at the time of the order, and cannot be fairly cited as precedent for appellant to pay such taxes accruing at a later time. Any inequity that might appear to have resulted from his payment of the income taxes can be adjusted by the judgment.
In ordering appellant to pay the income taxes, the court performed its duty any exercised its equity jurisdiction. It has broad powers and a wide discretion in settling the property rights in controversies arising out of the marriage relation. Bowman v. Bowman, 29 Cal.2d 808, 811, 178 P.2d 751, 170 A.L.R. 246. During the pendency of an action for divorce the court may, in its discretion, require the husband to pay as alimony or as costs of action or as attorney's fees any money necessary for the prosecution of the action and for support and maintenance. Civ.Code §§ 137.2, 137.3. The court's power is so extensive that it may make an award of alimony within the husband's ability to pay for the specific purpose of enabling the wife to protect her interest in the community property. Tompkins v. Tompkins, 83 Cal.App.2d 71, 187 P.2d 840, 844; Heck v. Heck, 63 Cal.App.2d 477, 480, 147 P.2d 114; Larsen v. Larsen, 101 Cal.App.2d 862, 865, 226 P.2d 650. She is entitled to live in her accustomed manner. Falk v. Falk, 48 Cal.App.2d 780, 790, 120 P.2d 724.
In the Tompkins case, supra [83 Cal.App.2d 71, 187 P.2d 842], in addition to an award of the major portion of the community property and of alimony, the judgment required the husband to pay the wife an ‘amount sufficient to enable her to keep up the premiums on two insurance policies on the life of defendant’. On appeal it was held that such order ‘would encompass the right to protect her expectancy under a life insurance policy wherein her divorced husband is the insured and she is beneficiary, particularly where the policy has an accrued value purchased by premiums paid from community funds during the marriage.’ Such award was not an abuse of discretion despite the further fact that the wife was employed at a monthly salary of $169 and would increase her income by $40 monthly, revenues from the realty awarded her, and despite the impoverished state of the husband's finances in that he possessed only $500; had no interest in any property; had removed from the sea coast where he was under a doctor's care to an inland location because of bronchial trouble. An award under such circumstances rests in the sound discretion of the trial court, Miller v. Superior Court, 9 Cal.2d 733, 736, 72 P.2d 868, and will not be disturbed on appeal unless it is clearly shown that the court's discretion was abused. What is necessary rests in the sound discretion of the trial court. Howton v. Howton, 51 Cal.App.2d 323, 327, 124 P.2d 837.
By reason of the fact that an order for respondent to pay the $11,000 taxes would be compelling her to pay a community debt, would necessitate a sacrifice of a portion of her separate property, would imperil the safety of the community estate in the custody of appellant, and because the division of community property will not have been made prior to judgment, the order must be approved.
The contention that no proof was made whether or not payment of the income taxes could be extended to the time of trial is irrelevant for two reasons: (1) payment of federal income taxes due March 15, 1953, could not have been extended for a period longer than September 15 of the same year. Internal Revenue Code, sec. 53(a)(2), 26 U.S.C.A. § 53(a)(2); (2) the taxes were a community debt and appellant had community funds which were primarily liable for the payment of such community obligation.
Appellant's argument that the order for payment of the federal income taxes has no relation to respondent's demand for support or for suit money disregards momentous facts. Since she is jointly and severally liable for payment of the taxes, if they are not duly paid, liens will be imposed upon all her properties to enforce collection. Such a tragedy would be a potential erasure of her separate assets and provision for future support. The two authorities cited by appellant on this point are distinguished on their facts. In Busch v. Busch, 99 Cal.App. 198, 278 P. 456, the husband was directed to pay his wife $3,600 with which to repay her father for sums the latter had advanced prior to the order. But because the wife admitted on the stand that she was not obligated to her father, the order was reversed. In Tremper v. Tremper, 39 Cal.App. 62, 177 P. 868, no proof was made of the necessity for an order.
By virtue of the facts above recited and because of the danger that appellant might alienate the community property now in his possession and thereby imperil respondent's right to share in the division of such assets, affirmance of the order is unavoidable.
I dissent from the order of this court insofar as it affirms the trial court's order directing that defendant pay the federal and state income taxes on the separate property of Plaintiff. (See Rutledge v. Rutledge, 119 Cal.App.2d 114, 259 P.2d 79.) Otherwise I concur in the order of affirmance.
MOORE, Presiding Justice.