IN RE: MARRIAGE OF MILLSBERG. (1978)

Elaine Millsberg (Elaine) sought dissolution of her 17-year marriage to Nelson M. Millsberg (Nelson). By stipulation the matter was bifurcated and the trial court reserved jurisdiction for a subsequent trial over all issues other than the marital status of the parties. Accordingly, an interlocutory and final judgment dissolving the marriage were entered in 1973. Trial of the reserved issues commenced June 25, 1975. After extensive trial the court divided community properties, awarded certain items of separate property to Nelson, determined custody of the children and awarded child support and spousal support for Elaine.

After denial of her motions to reopen and for new trial, Elaine appealed contending trial court error (1) in determining a 33-unit apartment dwelling (“Castillian apartments”) was the separate property of Nelson and awarding the same to him; (2) in awarding Nelson the El Capitan Mobile Trailer Home Park as his sole and separate property after determining its community nature; (3) in awarding her only $500 per month spousal support for a three-year period with an additional three-year reservation of jurisdiction to modify; (4) in charging the community with $3,500 of her attorneys' fees and in limiting the total attorneys' fees to $7,000; (5) in requiring the community to reimburse Nelson for $3,133.60 paid by Nelson pending trial from his separate funds into a limited partnership known as “Investors Imperial”; Elaine also makes this final complex contention: while she does not appeal from the award made to her of the sum of $30,202 less the $3,133.60 to be paid to Investors Imperial, she contends an award in excess of $30,202 should have been made to her to equalize the division of community property.

Stripped of the trappings, at the core of Elaine's appeal is this prime contention: the trial court erred in holding the Castillian apartments to be Nelson's separate property subject to no community claim. In awarding the apartments to Nelson, the court in legal effect confirmed a “transmutation” of “gifts” to him of community money, community credit and community services, allegedly compelled by a 1965 oral “contract” with Nelson's father, David Millsberg. The “transmuted” property was the principal product of eight years (1965-1973) of community effort—33 rental units producing $1,500 per month cash flow income and appraised in 1974 at $415,000 fair market value.

I

FACTS—THE MARRIAGE

The parties were married on November 11, 1955, and separated October 1, 1972. Three children were born of the marriage: Roberta in 1960; Betsy Ann in 1962; and Jennifer in 1965. The couple in the early years of marriage worked in Nelson's parents' apartments and commercial property. This continued until Nelson received his law degree.

In 1957 Nelson started law school and in January 1962 commenced the practice of law. He specialized in real estate, bankruptcy and probate law. He also taught real estate law. Elaine attended some of his classes. During the marriage (1957) Elaine obtained her real estate salesperson's license and began selling real estate. She earned $850 in 1958 and $3,656.38 in 1959. During her first pregnancy (1960) she ceased working outside the home. Elaine last worked at an outside-the-home paying job in 1962 and 1963 when she earned $50 and $65 respectively during those years. The marriage for a long period was essentially a happy one and Elaine respected Nelson's judgment in many areas. She developed a good relationship with his parents. Nelson was without question the manager of the community. He determined how title vested in the various properties acquired by them during the course of their marriage. Nelson's family prospered and the family income increased over the years of the marriage. From Nelson's financial declaration filed in 1975, he was earning a total net-after-taxes take home income monthly of $3,713.

II

THE CASTILLIAN APARTMENTS TRANSACTION

From the trial court's findings, we summarize the events which brought David Millsberg into the Castillian apartments transaction.

Nelson and Elaine and their personal friends Mr. and Mrs. Fadem desired to “syndicate” the development of an apartment house. In August of 1965 the two families agreed to purchase real property on which the 33-unit Castillian apartments were eventually to be built. Their plan called for the sale of interests in a limited partnership in which Nelson and Mr. Fadem were to be the general partners. Each interest was to be sold to prospective investors for the sum of $12,000. A 90-day escrow was opened in August 1965 to purchase the two lots. The Fadems deposited $1,000 and the Millsbergs deposited $1,000 from community funds therein. The balance of the purchase price ($42,000) was due at the end of the 90-day escrow period.

During the 90-day escrow period, Nelson, on behalf of the joint venture, attempted without success to obtain persons who would invest money in the apartment house project contemplated. At this time, neither the Millsbergs nor the Fadems had additional money to invest in the project and Nelson testified “the project would have failed without additional financing.”

Towards the end of the 90-day escrow period, Mr. and Mrs. Robert L. Dismuke agreed to invest the sum of $12,000 in the project. The Dismukes were friends of the Millsbergs, clients of Nelson. Nelson was fearful the apartment house project would fail for lack of money, that he and Fadem “would lose their money,” and that the Dismukes “would lose their money” if no one else invested in the project. Nelson contacted his father, David T. Millsberg (now deceased), and requested financial assistance.

“David Millsberg agreed to finance the apartment project, but only on condition that [Nelson's] interest in the project be the sole and separate property of [Nelson], his son. It was the policy of David T. Millsberg not to loan money to his children for the purpose of assisting them to purchase real property unless the real property purchased was the sole and separate property of the child to whom money was lent. This policy of David Millsberg was known to [Elaine].” (Emphasis added.)

Before obtaining the agreement of David Millsberg to finance the project, Nelson “discussed with [Elaine] the fact the project would fail unless financing was obtained, of his desire to ask his father for financial assistance, the fact that if his father agreed to finance the project this would entail [Elaine] having to transfer her interest in the project to [Nelson] so he would own the same as his sole and separate property.” (Emphasis added.)

Shortly before the close of the 90-day escrow period, and after David Millsberg agreed to finance the project, Robert L. Dismuke invested $12,000 in the apartment house project and became a member of the joint venture. To close the escrow, two promissory notes (secured by deeds of trust) each in the face amount of $15,000 with interest at six percent (6%) per annum, due May 23, 1966, were given the seller.

Concurrent with closing of the 90-day escrow (November 23, 1965), Elaine, Phyllis R. Fadem (the wife of Ronald G. Fadem) and Mary Lou Dismuke (the wife of Robert L. Dismuke) each executed a quitclaim deed wherein they quitclaimed their interests in the real property to their respective husbands.

At the time of quitclaiming, Elaine was a licensed real estate salesperson; she had completed the Anthony Schools courses leading to her salesman's license; she had audited courses in real estate law taught by Nelson and completed over three years of college majoring in business; she had sold real estate in the years 1958, 1959, 1960, 1962 and 1963 and had assisted Nelson in the management of apartment houses and commercial property.

“Prior to signing the quitclaim deed, an explanation of the effect of signing the quitclaim deed was made in the presence of [Elaine]. [Elaine] knew at the time she executed the quitclaim deed she was transferring all her interest in the property to [Nelson] as his sole and separate property. [Elaine] signed the quitclaim deed freely in order to obtain the agreement of David T. Millsberg to finance the project in order that the project could proceed, with the knowledge that the project would fail unless David T. Millsberg financed the project, and with the expectation of future benefit if the project succeeded.” (Emphasis added.)

At the date of maturity (May 23, 1966) of the two promissory notes given in part payment of the real property, the three joint venturers were unable to pay. David Millsberg, “in accordance with his prior agreement,” advanced the sum of $30,000 to pay the two notes.

Concurrent with the advance of the $30,000 by David Millsberg, Ronald G. Fadem, Robert L. Dismuke, and Nelson M. Millsberg executed a quitclaim deed transferring a 21/452145ths interest in real property to David Millsberg. As a result of the May 23, 1966, quitclaim deeding, Ronald G. Fadem was no longer a member of the joint venture group.

On November 30, 1967, Robert L. Dismuke and Mary Lou Dismuke quitclaimed their interest in the joint venture real property to Nelson as his separate property. In consideration for this transfer, Nelson agreed to pay the sum of $18,000 to Robert L. Dismuke. This sum was paid in irregular installments “out of the rents and incomes of the apartment house.”

On November 30, 1967, David T. Millsberg also executed a quitclaim deed to Nelson M. Millsberg, transferring all of his interest in the apartment house venture to Nelson M. Millsberg. The consideration for this transfer was Nelson M. Millsberg's agreement (evidenced by a promissory note and trust deed for $20,930) to repay David Millsberg for advances theretofore made and thereafter to be made at such time as the apartment buildings were constructed and rental income were received.

David Millsberg lent his credit to Nelson Millsberg, and an interim loan from a third party in the amount of $225,000 for a 30-year period was obtained for construction of the 33 units. The father advanced additional sums to facilitate construction.

Based upon the foregoing findings of fact, the court concluded that the Castillian apartments were the sole and separate property of Nelson.

We note these significant voids in the findings: First, there is no finding of any agreement, express or implied, that Elaine intended or agreed to make a gift by the November 23, 1965, quitclaim deed of the community interest in that escrow agreement, the $1,000 deposit. Secondly, there is a total silence insofar as any factual finding of an intent to make a continuing gift in futuro to Nelson. The findings do not hint that any agreement that eight years of contributions of community services together with $30,000 in community funds, together with community credits, were to be a gift to Nelson. The trial court was “satisfied” that Elaine on November 23, 1965, understood what a quitclaim deed was and intended to transfer her interest in the project to Nelson in order to secure the father's promise of future financial support and that she evidenced that intent by signing the quitclaim deed. The critical findings quoted above were providentially objected to by Elaine's counsel as being “ambiguous and not supported by the facts elicited upon trial.”

The overriding issue presented by these findings and conclusions is as to the ownership of the Castillian apartments. Was there a valid enforceable agreement between the parties respecting the Castillian apartments transmuting their character from community property to separate property of the husband? The short answer to the question is: There is a total lack of evidence of any such agreement between the parties to this lawsuit. It is Nelson's contention: “This case was tried on the theory there was an agreement between [Elaine], [Nelson] and [Nelson's] father wherein [Elaine] transmuted the real property at issue into the separate property of [Nelson] in consideration of the promise of [Nelson's] father, David T. Millsberg, to finance the apartment project. ‘David T. Millsberg agreed to finance the apartment project, but only on condition that [Nelson's] interest in the project be the sole and separate property of [[Nelson], his son.”’

Nelson does not testify to an agreement between himself and Elaine, rather he made certain conclusionary statements as to an “offer” by his father to “rescue,” to “finance” the apartment project if the property was placed in Nelson's name. Thus it is Nelson's contention that his “father agreed to guarantee the property if it was [Nelson's] property.” Thus the precise issue is whether a transmutation of community to separate property by virtue of an agreement with a third person, the elder Millsberg, was here factually accomplished.

Nelson further asserts the trial court, based on substantial albeit disputed evidence, found the property to be his separate property; and concludes under these circumstances, “The finding of a trial court that property is either separate or community in character is binding and conclusive on the appellate court if it is supported by sufficient evidence, or if it is based on conflicting evidence or upon evidence that is subject to different inferences; …”' (Beam v. Bank of America, 6 Cal.3d 12, 25, 98 Cal.Rptr. 137, 146, 490 P.2d 257, 266, and cases cited.)

DISCUSSION

Before analyzing the evidence bearing upon the critical findings and the issue so defined, we must first establish certain legal premises applicable and controlling here.

In 1965 California Civil Code sections 162, 163 and 164 (now Civil Code sections 5107, 5108 and 5110) provided, inter alia, that except for property owned by either the husband or wife before marriage or property acquired “afterward” by gift, bequest, devise or descent, all real property situated in this state and all personal property wherever situated, acquired during the marriage by a married person while domiciled in this state, was their community property.

In determining whether property is community or separate, the trial court is not bound by the form of deed. (DeBoer v. DeBoer, 111 Cal.App.2d 500, 505, 244 P.2d 953; Faust v. Faust, 91 Cal.App.2d 304, 308, 204 P.2d 906; Tomaier v. Tomaier, 23 Cal.2d 754, 757, 146 P.2d 905.)

“[I]t is well settled in this state that the form of the instrument under which a husband and wife hold title is not conclusive as to the status of the property and that property acquired under a joint tenancy deed may be shown to be actually community property or the separate property of one spouse according to the intention, understanding or agreement of the parties.” (Socol v. King, 36 Cal.2d 342, 345, 223 P.2d 627, 629.)

Further, the fact that the property is taken in the husband's name alone creates no presumption of gift or that it is his separate property. The law is to the contrary. The Supreme Court in the Estate of Duncan, 9 Cal.2d 207, 223, 70 P.2d 174, 182, said:

“Thus the fact that he dealt with it as his own, in view of the fact that he controlled it all as community property, is not convincing proof that it was his separate property. Likewise, the fact that the stock was taken in his name creates no presumption that it is his separate property. The presumption which does arise in the case of property held by the wife in her own name that it is her separate property does not arise in the same situation when the property stands in the name of the husband.” (Emphasis added.)

“Without such intention to make a gift, the mere conveyance to her [or him] would not invest it with that character.” (Fulkerson v. Stiles, 156 Cal. 703, 706, 105 P. 966, 967; see also Fanning v. Green, 156 Cal. 279, 283, 104 P. 308; Tolbard v. Cline, 180 Cal. 240, 244, 180 P. 610.)

We conclude with certainty, the taking of the title by the husband alone, without more, does not effect a transmutation of concededly community asset into a husband's separate property.

It is the agreement, understanding or intention of the husband and wife respecting the status of their property, as to whether it is separate, community, or joint tenancy that is determinative of its status. (Gudelj v. Gudelj, 41 Cal.2d 202, 259 P.2d 656.)

It has long been the law in California that a husband and wife may by contract transmute separate property into community property or community property into the separate property of the other spouse. (See Perkins v. Sunset Tel. and Tel. Co., 155 Cal. 712, 719, 720, 103 P. 190; and In re Marriage of Jafeman, 29 Cal.App.3d 244, 255, 105 Cal.Rptr. 483.)

No particular formalities as between the husband and wife are required for an effective agreement. (James v. Pawsey, 162 Cal.App.2d 740, 741, 328 P.2d 1023.) Such agreement may be either written or oral, express or implied (Alocco v. Fouche, 190 Cal.App.2d 244, 251, 11 Cal.Rptr. 818; Van Houten v. Whitaker, 169 Cal.App.2d 510, 517, 337 P.2d 900); and their parties' understanding or intention may be inferred from their conduct or declarations (Cash v. Cash, 110 Cal.App.2d 534, 538, 243 P.2d 115).

Where it is claimed that an instrument in writing—here a quitclaim deed—executed by the wife changed the status of concededly community property to the husband's separate property, the question of the intent of the wife in execution of that document is “the all-important and controlling question.” (Horsman v. Maden, 48 Cal.App.2d 635, 641, 120 P.2d 92, 95; DeBoer v. DeBoer, supra, 111 Cal.App.2d 500, 244 P.2d 953; Donlon v. Donlon, 140 Cal.App.2d 428, 431, 295 P.2d 51.)

While there is no doubt that a husband and wife may effect a transmutation of community to separate property with respect to the other spouse, yet the proof of a change in the status of property by agreement between the spouses must be established by evidence of a present, positive agreement. (33 Cal.Jur.3d, Family Law, p. 77.) In Thomas v. Hoffman, 122 Cal.App. 213, 217, 9 P.2d 538, 539, it was

“urged that the court erred in refusing to admit certain evidence which was offered. The offer was to prove by a certain witness that, at the time the land here involved was purchased, statements were made by the appellant and her husband to the effect that the land was being bought for her as her separate property, and that prior thereto, when another property was sold, the proceeds were so divided that Mr. Thomas took his share and Mrs. Thomas took her share and that she bought this property with the intent that it was to be her separate property.”

This court held:

“The first part of the offered proof was a self-serving declaration, and such a change from community to separate property is to be proved only by showing a definite present agreement to that effect. As to the second portion of the offer it was technically not sufficient, as no present positive agreement to that effect was offered to be proved, nor was it offered to be proved that the husband had any such intent.” (Id. at p. 217, 9 P.2d at p. 539.)

In In re Freitas, D.C., 16 F.Supp. 557, 561, the federal court held:

“Agreements between husband and wife relating to their property do not require any particular formality. See Estate of Sill, supra [121 Cal.App. 202, 9 P.2d 243]. Nevertheless, where rights are asserted to valuable real estate and improvements, upon the basis of an oral understanding had many years before, the requirement of certainty declared by the cases cited becomes all-important. See Hammond v. McCollough, supra [159 Cal. 639, 115 P. 216.]”

Where as here the transmutation validated by the trial court was from concededly community property to the separate property of a lawyer husband, the requirement of a present, positive agreement to so transmute becomes of critical importance. By the “transmutations” here claimed the husband gained an enormous advantage over the wife.

Where the husband relies upon a “contract” between his wife and his father to effect a transmutation, to make a gift to him of community property, then we are confronted not only with the special requirements applicable to transmutation agreements but also with those hornbook rules prerequisite to any valid contract.

It is fundamental that an offer to contract must be sufficiently definite and certain to enable a court to give it an exact meaning; the offer must call for acceptance in definite terms so that the performance required is reasonably certain. (See 1 Witkin, Summary of California Law (8th ed. 1974) Contracts, § 108, p. 109; Rest., Contracts, § 32.) 1 Williston (3d ed. 1957) § 37, p. 107, states:

“It is a necessary requirement in the nature of things that an agreement in order to be binding must be sufficiently definite to give it an exact meaning. The promise that is so indefinite may not be legally enforced.”

“There is nothing of more importance than that the ordinary contracts between man and man, which are so necessary in their intercourse with each other, should be certain and fixed, and that it should certainly be known when a man is bound and when he is not.” (Lloyd v. Collett, 4 Bro.C.C. 469, 29 Eng.Rep. 992 (1793).)

Moreover, the subjective uncommunicated intent of the offeror (here the elder Millsberg) is not controlling. In Brant v. California Dairies, Inc., 4 Cal.2d 128, 133, 48 P.2d 13, 16, questions of this nature were put to the witness:

“‘Q. Did you interpret that request for a year's notice as an agreement that if you could not sell it at the then price, and could not make an adjustment, that you would have to continue for a year? A. No, absolutely not․’ [Said the Supreme Court,] Other statements of similar character were admitted. Together they amount to nothing more than a statement of what Carver personally believed the agreement of the parties to be. But it is now a settled principle of the law of contract that the undisclosed intentions of the parties are, in the absence of mistake, fraud, etc., immaterial; and that the outward manifestation or expression of assent is controlling. This is the ‘objective’ standard, established by the modern decisions and approved by authoritative writers. [Citations.]”

The facts here are in this unusual posture. First, neither the father nor his personal representative, his estate, is a party to this action; yet Nelson seeks to enforce a claimed right deriving out of a contract with his father. As to the legal effect of the failure to join the representative of the deceased father, we examine anon.

Secondly, Nelson's “evidence” of such a “contract” consists of his subjective impressions of his father's statements, demand. We search the record in vain for evidence indicating the extent or nature of the terms upon which the father would “rescue” the joint venture; Nelson relied upon numerous discussions had with his father about the project and testified to his “impressions,” his “understandings” of his father's demands. “[I]t was my impression from my conversations with my father that as long as it was my property alone that he would participate if necessary.” Nelson first requested the quitclaim to be prepared “because of my father's attitude.” It was Nelson's “understanding” if additional investors were not forthcoming, his father would come in.

Concerning the quitclaim deed, Nelson related:

“A … It was discussed over a period of time.

Q That she would give up her interests in the property?

A That if we needed my father to save our project, he was to come in and guarantee Bob Dismuke, that she was going to have to sign off.” (Emphasis added.)

We conclude the only evidence of any pre-November 23, 1965, offer to contract from the elder Millsberg consists only of vague subjective understandings or impressions of Nelson. We do not know what David Millsberg was bound to do; we do not know what he required of Elaine. This evidence does not meet the “objective” standard of Brant v. California Dairies, Inc., supra, 4 Cal.2d 128, 48 P.2d 13. It is not a “present, positive agreement.”

The evidence of any communication of this uncertain offer to Elaine is equally vague, equally lacking in hard factual substance. Nelson testified, “Why she was signing the quitclaim deed primarily was because of my father's attitude.” Nelson “believe[d] that she was well aware of [his] father's attitude.”

Nor does the “offer” as communicated call for acceptance in definite terms so that the performance required is reasonably certain. Did Elaine know she was required to make a gift of a community asset in the escrow when she signed the November 23 quitclaim deed? Nelson testified, “She knew what she was signing.” Did Nelson explain to Elaine the significance of the deed? He testified, “We did not go into too much details about the legal ramifications, because she was an experienced real estate saleslady, and had courses in that․ I probably told her that she was to—that she was giving up all her rights, yet on the other hand she knew exactly what she was doing. She knew what the quitclaim deed was, and she knew what the effect of it was going to be. And she knew what community property was, and she knew what sole and separate property meant․ Why she was signing the quitclaim deed primarily was because of my father's attitude․ And I walked away feeling that she understood fully the legal significance of her act.”

Further, concerning a disclosure by Nelson to Elaine concerning the significance of the quitclaim deed, Nelson testified: “I don't believe that I sat down specifically any one day and said, ‘Here's a trust deed or a quitclaim deed,’—I know I didn't—and say, ‘Here's a quitclaim deed. Here's your rights and liabilities. You don't have to sign it, etcetera.”’

The highwater mark of evidence of any understanding that a transmutation of community property to separate property was required, that the father demanded a gift to his son, if he was to “rescue” the venture appears in this discourse:

“Q … Did you tell Elaine at the time that she signed the quitclaim deed that it was to be your sole and separate property?

A Yes, that's what the deed said.”

Of even greater significance in terms of the enormous “transmutation” claimed to have occurred post-November 23, 1965, is the total lack of any evidence in this record of any request or demand by the father or any agreement upon the part of Elaine that there be a continuing gift of community assets to the son. There is no word or act in this record on the part of the wife signifying an agreement to make a gift in futuro of the apartments, the principal asset acquired during their marriage. Her non-action over the years is not equivalent in law to assent. Nelson's taking title in his own name does not as a matter of law equate with acceptance. This is a unilateral act by the husband in control of the community.

We next examine to determine whether there was a consideration or a thing of value received by Elaine for her quitclaiming. The husband testified that Elaine “received something” for quitclaiming. “It was prospective advantage that she would receive if I was unable to pursue an opportunity. She knew that the benefits would ultimately flow to her through the income derived therefrom.”

And Nelson was further examined:

“Q … If your wife had refused to sign the quitclaim deed, … what was your expectancy as to what would have occurred?

A The deal would have failed.

Q And what would have been lost to the community?

A The original investment of $1,000, if I put it in. And the loss of a chance at a moderate profit, or a very, very good profit, very advantageous situation. The lot was selling for $1.50 to us. Everything else around there was $2 a foot. The worst that could have happened is that we could have sold the lots for market value and made $30,000—no, $15,000 on it, because it was a 30,000 square foot lot. And, of course, the best was that an apartment house, though maybe my share in my name alone, had there been an apartment house and profit, would have come off, in which she would have enjoyed the benefits of.

Q So, in fact, then, Mrs. Millsberg did receive something for the signing of that quitclaim deed?

A Yes.”

If we decode this statement and find it to be an admission, then Elaine is entitled to “the income derived” from the Castillian apartments and to “enjoy [ed] the benefits.” Nelson's posture here would deny Elaine income or benefits of the apartments.

Equally ambivalent is the father's offer (promise?) in November 1965. Was he offering to lend money to finance Nelson, or was the offer to finance the entire syndication operation? Was he offering to secure a loan from a third party for Nelson or for the syndication, or was he offering to buy out the entire venture or buy out all but Nelson's interest? Was he offering to buy into—to become an investor in the project? If the offer was of financing, what was the extent of the commitment? Nelson's testimony concerning his “impressions” about the father's promise to rescue the operation gives no solace where the rule requires more than illusory promises. We conclude that the consideration—whether benefit to Elaine or detriment to David Millsberg—was so vague, so uncertain as to be unenforceable.

Nor does the performance required of Elaine (her acceptance) by this will-o-the-wisp offer possess the requisite certainty for an enforceable contract. Was the father requiring simply a form of title holding in the son? If the consideration required of Elaine was a transmutation of community to separate property, then the nature and extent of the gift required was totally left in limbo. Was it for so long as they both shall live that she and Nelson would continue to transmute community values into Nelson's separate property or was the gift to be limited to the community asset ($1,000) then subject of the escrow? If the gift in the future was required, where are the words that would call into being such an enormous wifely sacrifice? We conclude such uncertain undertakings do not equate with a “present, positive” agreement of transmutation.

Nor do the subsequent acts of the parties give solidity to that evanescent beginning. Again if Nelson is to be believed, the project did not need rescuing. “The worst that could have happened is that we could have … made $15,000․” When the elder Millsberg did enter the project in May 1966 the unimpeached record reflects he acquired a 21/452145ths title interest in the project in return for $30,000. Two years later when the apartment building was commenced, David Millsberg did advance funds and lent aid in obtaining credit. His title position was ultimately exchanged for a trust deed holder—creditor position. The Dismukes, husband and wife, quitclaimed, sold their interest in the project to Nelson for $18,000. There is no evidence in the record of the project ever having been in such financial straits as to require David Millsberg to “rescue” the project or to “save the Dismukes” from loss.

Nor does the subsequent act of the parties give rise to any inference of any agreement between the spouses or with a third party to effect a transmutation of community to separate property.

From November 30, 1967, onward, title was solely in Nelson's name. The commitment from the construction money lender was on Nelson's signature alone. However, Elaine did execute a series of promissory notes agreeing to repay monies borrowed for the construction. Construction costs were paid in part out of Nelson's law practice account. In total approximately $30,000 of community funds found their way into the costs of the apartments, including the paying off of the Dismuke debt. Further, both parties worked, rendered valuable services in the construction phase of the apartments. After construction was completed, both parties participated in the management and servicing of the apartments. Rental monies collected were used not only to repay construction debts and to pay apartment operating costs, but also for household expenses. The apartment rentals and earnings from Nelson's law practice were hopelessly commingled, “juggled.”

The parties for income tax purposes reported the income on their joint return showing ownership in both names. They jointly shared income and loss from the units over the years. The legal effect of this course of conduct is detailed in Durker v. Zimmerman, 229 Cal.App.2d 203, 206-207, 40 Cal.Rptr. 227, 229, where the appeal court states:

“It is well recognized that income tax returns may be indicative of an agreement concerning the character of the income reported thereon [citation]. While the filing of such returns does not establish transmutation as a matter of law [citation], a trial court may construe income tax returns as evidencing an agreement concerning the nature of property [citation]. Here, the failure of the parties to take advantage of income splitting provisions is an indication that the income of each was to be treated as separate property (cf. Lawatch v. Lawatch, supra, 161 Cal.App.2d at p. 790, 327 P.2d 603, where the trial court held that the splitting of income on joint returns indicated that the husband's earnings were treated as community property).”

Nelson vigorously eschews the concept of a gift from Elaine, and properly so. He testified, “There was no mention made of an outright gift of anything, no.” The entire course of conduct, excepting only the form of title holding, gives rise to inferences of joint ownership.

The requirements of particularity and certainty for either a gift or a contract of transmutation are to be underscored where the transmutations claimed were from a wife to a husband skilled in the law where there is no evidence of any independent advice either offered or received by her and where by the transactions the husband gained an enormous financial advantage over the wife. We conclude such evidentiary shadows offered by Nelson do not support a finding of contract with the father for gifts to Nelson or a bilateral agreement of transmutation.

Further distinct principles of law dictate the same result.

Nelson's assertion that the quitclaim deed was given in exchange for the promise of a third person, the father-in-law, runs afoul this further legal barrier.¹ An agreement between Elaine and the third party requiring title to be held by her husband in a specified fashion did not necessarily determine her property rights vis-a-vis her husband. The rule has been long recognized that the rights and obligations which spouses have with respect to third parties are not necessarily determinative of their property rights inter se. As was said in Siberell v. Siberell, 214 Cal. 767, 772, 7 P.2d 1003, 1005:

“So in the case of a joint tenancy, if the contention of appellant were followed, we would in some instances have a joint tenancy where the wife owned three-fourths of the property and the husband the remaining one-fourth. It should be noted here that we are dealing strictly with the situation as between the parties to the marriage and are not dealing with the characteristics of the property as against the claims of judgment creditors or other third persons as was the case in Hulse v. Lawson, 212 Cal. 614, 299 P. 525.”

In Title Ins. and Trust Co. v. Ingersoll, 158 Cal. 474, 485, 111 P. 360, 365, the Supreme Court said:

“Appellant suggests that the rights of creditors of the community, or of third persons dealing with the husband, might be jeopardized by this doctrine. The answer is that no such rights are here involved, and that if third persons have equities superior to those of the wife they would be fully protected and enforced in a proper action.”

It was held in Hansford v. Lassar, 53 Cal.App.3d 364, 371, 125 Cal.Rptr. 804, 808:

“In view of the express language of section 5110 [formerly Civ. Code, § 164], this community-property presumption has no application to the instant case as it involves a dispute with a third party, rather than one between husband and wife in a dissolution of marriage or legal separation proceeding.”

In Schindler v. Schindler, 126 Cal.App.2d 597, 604, 272 P.2d 566, 570, the court said:

“Although there is a statutory period for the institution of an independent action to avoid deeds of that character [citation] it would appear this is for the protection of third parties who might rely on the recorded instruments. As cautioned in Siberell (214 Cal. p. 772, 7 P.2d 1003) it should be noted that we are dealing here strictly with the controversy between the parties to the marriage and are not determining standards by which the characteristics of the property are ascertained when the claims of judgment creditors or the rights of third persons are involved.”

From the foregoing cases we derive these premises: A third person having contractual relations with a husband and wife regarding the title holding of their community property may enforce that agreement to the letter; (2) the husband and wife by their dealings inter se may not defraud a third party; and (3) if third parties have equity superior to those of the wife and husband, they may be enforced in an appropriate proceeding.

These rules however do not determine the rights of the husband and wife inter se. Rather, we are dealing with parties to a marriage whose rights in their conjugal property are governed by the rules discussed at length above.

Here the requirement, if such was the requirement, that the title be held in Nelson's name alone—to meet the demand of David Millsberg—does not determine as between these parties whether a gift has occurred, whether commingling has occurred, whether a resulting trust has occurred. Only to the extent that such relationships would interfere with an enforcible promise to a third party would rights inter se be subordinated. David Millsberg invested in, aided in promoting the project and was later bought out by the note and trust deed. He is now deceased. No one testifies, no document evidences, no acts indicate that the requirement that Elaine's quitclaim to Nelson in November 1965 encompassed any agreement or promise of continuing gifts to the husband. No superior equities in the father-in-law appear here.

Moreover, the estate or personal representative of the now deceased David Millsberg has not been made a party to this lawsuit. If the estate of David Millsberg had any enforceable contract claim against Elaine, it should, could have been made a party. Nelson had it within his power to bring in such party but chose not to do so. “He cannot now be heard to complain.” (Melny v. Melny, 90 Cal.App.2d 672, 676, 203 P.2d 588, 591; Carmichael v. Carmichael, 216 Cal.App.2d 674, 680, 31 Cal.Rptr. 514.)

These further principles uphold Elaine's claim. Where property is acquired during the marriage in the name of the husband, it is presumed to be community. It was stated in Fountain v. Maxim, 210 Cal. 48, 50-51, 290 P. 576, 577:

“But the property here in question, having been acquired during coverture, and taken in the name of the husband, is presumed, under section 164 of the Civil Code, to be community property; and, unless the presumption is successfully controverted by other evidence, the court is bound to find according to the presumption. [Citations.]”

The burden of proving the contrary is on the husband. (Minnich v. Minnich, 127 Cal.App. 1, 8, 15 P.2d 804.)

Title taken by the husband in analogous circumstances has been held to create a trust in favor of the wife. As was said in Shaw v. Bernal, 163 Cal. 262, 271, 124 P. 1012, 1015:

“It is well settled that ‘if a husband purchase lands with the separate estate of his wife in his hands, … or money put into his hands to invest for his wife, and take the title in his own name, a trust results to the wife’ ․”

To permit the husband to appropriate community monies, credits, services—under his management and control—to his separate use would operate as a constructive fraud on the wife. (In re Marriage of Jafeman, supra, 29 Cal.App.3d 244, 256, 105 Cal.Rptr. 483; Dunn v. Mullan, 211 Cal. 583, 296 P. 604; Wheeland v. Rodgers, 20 Cal.2d 218, 222, 124 P.2d 816.) There is no showing here of consent by word or act of the wife. Mere silence, non-action, is not consent. (Leslie v. Brown Brothers Incorporation, 208 Cal. 606, 621, 283 P. 936.) In Title Insurance etc., Co. v. Ingersoll, 153 Cal. 1, 5, 94 P. 94, 95, the Supreme Court stated in substance: The mere acquirement of the possession of a wife's separate property by the husband, and his subsequent management and control of the same, all with her consent, do not show any intent on the part of the wife to make a gift of the property to the husband, or to change its status from separate to community property, that the presumption in such a case is that the property continues to be the separate property of the wife and that the husband holds it in trust for her, and that under such circumstances it devolves on the trustee claiming a gift or change in the status of the property to show the same.

Another factual aspect of this case points to the conclusion no gift was intended. The record here is one of utter and complete commingling of community funds, community credits, community efforts with the earnings from the Castillian apartments. The identities, if they were ever separate, are thoroughly lost. Nelson's description of his financial activities as “juggled” is most apt. The legal effect of commingling, where the property is under the continued and exclusive management of the husband, is set forth in Nichols v. Mitchell, 32 Cal.2d 598, 609, 197 P.2d 550, 557, where the court said:

“Such … procedure would support the inference that any separate property that Mrs. Mitchell may have had was no longer so identifiable, but had become commingled with the community property of the parties and constituted a part of the community estate. [Citations.] And the fact that Mr. Mitchell admittedly used community funds in making subsequent payments on the property here in question was another circumstance which the trial court might have viewed as indicating that though legal title was in the name of Mrs. Mitchell, the property actually represented a community asset rather than her separate estate. [Citation.]”

Had there been a gift to Nelson of the $1,000 in escrow by the quitclaim deed of November 23, 1965, the legal effect of the later commingling of concededly community assets resulted in the Castillian apartments becoming in toto community property. To hold otherwise would put a judicial stamp of approval on a species of constructive fraud on the wife. Nelson would obtain an enormous financial advantage—an unconscionable one—over Elaine as the result of these transactions. He occupied a position of trust vis-a-vis Elaine during the many years of his control over their community assets. (Estate of Cover, 188 Cal. 133, 143, 204 P. 583.) He could not use Elaine's community property to enrich himself.

Based upon each of the foregoing factual and legal premises, we conclude that the Castillian apartments were and are community property of these parties. The judgment finding it to be the separate property of Nelson must be reversed. Upon remand and further hearing in the court below, this community interest must be measured and divided equally in accordance with the mandate of Civil Code section 4800 subdivision (a).

For guidance of the trial court we examine these further contentions of error. Elaine asserts that the trial court failed to make a determination of and distribution of all the assets of the community. Specifically she asserts that Nelson “in no way accounted for the $42,351.51” received by him. These sums were derived according to the testimony from his law practice from October 1, 1972, through May 31, 1975, and from the Keenan Enterprises. Nelson testified that since 1972—when the parties separated—income from community sources in the amount of $1,500 per month was paid to Elaine for her and the children's support. This amount was paid until entry of the interlocutory judgment in this matter in November 1973 which required Nelson to pay $900 spousal support, plus $200 per month each for the support of the three children or a total of $1,500 per month. This continued until January 1, 1974, when the amount was reduced to $1,300. On computing the amounts received from the time periods involved, it appears Elaine received the sum of $44,600, an amount in excess of that she complains Nelson has not accounted for. There is no merit in her contention.

Elaine next asserts Nelson breached his duty in making payments to limited partners, fellow investors in “Investors Imperial.” Nelson was a general partner in the Investors Imperial, a conceded item of community property and so pleaded by Elaine. Nelson was restrained by the interlocutory judgment of dissolution from selling or transferring or otherwise disposing of community property. By the terms of the limited partnership agreement, Nelson and the other general partner had guaranteed the limited partners a minimum 10% profit on their money for the first three years. The co-general partner had abandoned his interest, leaving Nelson under an obligation pursuant to the interlocutory judgment to maintain the property. So long as he maintained that property, he had the obligation to his remaining partners. His choice was to pay the monies or abandon the partnership. By court order he could not abandon or otherwise dispose of it. Substantial evidence therefore supports the trial court's conclusion that this expenditure was in maintenance of a community asset.

Elaine complains of the award of attorneys' fees. The determination of the amount of attorneys' fees to be allowed is within the sound discretion of the trial judge, and the reviewing court can and should interfere only where it finds under all of the evidence viewed most favorably in support of the trial court's action, that no judge could reasonably have made the order. (In re Marriage of Lopez, 38 Cal.App.3d 93, 113, 113 Cal. Rptr. 58.) It is here argued by Nelson's counsel that the amount of time, invested by the wife's counsel was unreasonable and unnecessary. After having read through the 115 page opening brief, we are inclined to agree. Specifically, Elaine contends that the court erred in charging $3,500 of the attorneys' fees awarded to her against the community property of the parties. This contention is without merit. An award of attorneys' fees is independent of the division of the community property. (In re Marriage of Jafeman, supra, 29 Cal.App.3d 244, 262-266, 105 Cal.Rptr. 483; In re Marriage of Berlin, 54 Cal.App.3d 547, 553-554, 126 Cal.Rptr. 746; In re Marriage of Folb, 53 Cal.App.3d 862, 874-875, 126 Cal.Rptr. 306; In re Marriage of Fischer, 78 Cal.App.3d 556, 566, 146 Cal.Rptr. 384.)

Elaine next contends that the trial court abused its discretion (1) in awarding her spousal support in the sum of $500 per month for a three-year period, and (2) authorizing the termination of spousal support after an additional three years. Our search is to determine, with respect to its award of spousal support and directing termination thereof, whether an abuse of discretion occurred. In a legal sense discretion is abused whenever in its exercise, a court exceeds the bounds of reason—all circumstances being considered. (In re Marriage of Lopez, supra, 38 Cal.App.3d 93, 114, 113 Cal.Rptr. 58.) The court had before it a 17-year marriage where the wife's principal functions were that of homemaker and raising the children. She, however, in addition, is a well-educated person, having nearly completed college—she has completed three years towards her degree with a major in business—and she could obtain her degree by going back to school for a year and a half period. She was, at date of trial, 40 years of age and was employed by the Red Carpet Realty. She had worked for a four or five month period but had not earned any money and not been able to set any “floortime”; nor had she earned any money selling real estate during the two year and eight month period during the separation and before trial.

The determination made of these two issues by the trial court are contrary to the standards, the criteria set forth in In re Marriage of Andreen, 76 Cal.App.3d 667, 670-673, 143 Cal.Rptr. 94; In re Marriage of Rosan, 24 Cal.App.3d 885, 896-898, 101 Cal.Rptr. 295; In re Marriage of Lopez, supra, 38 Cal.App.3d 93, 116-117, 113 Cal.Rptr. 58, and In re Marriage of Morrison, 20 Cal.3d 437, 447, 453, 454, 143 Cal.Rptr. 139, 573 P.2d 41, and therefore constitute an abuse of discretion.

Our determination that the Castillian apartments are community property requires reversal and remand for further proceedings in accordance with Civil Code section 4800 subdivision (a). As consequence of that further determination and in the light of appropriate standards, Elaine's support needs and the term thereof must be re-examined.

The portions of the judgment awarding the Castillian apartments to Nelson Millsberg, determining the amount of spousal support and the term thereof are reversed and these matters remanded for further proceedings consistent with the views expressed here. In all other respects the judgment is affirmed. The wife shall recover her costs on this appeal.

FOOTNOTES

1.  The facts surrounding the actual signing of the quitclaim deeds would indicate that each wife of the three joint venturers signed off at one time. According to Elaine the quitclaiming was to give flexibility to the husbands in business dealings with the real property. Elaine's position is buttressed by the fact that any financial interest by David Millsberg did not appear until some six months later when he bought a 21/452145ths title interest in the project.

STANIFORTH, Associate Justice.

GERALD BROWN, P. J., and COLOGNE, J., concur.