Marriage of Hembree CA4/1 ( 2024 )

Filed 1/12/24 Marriage of Hembree CA4/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
In re the Marriage of GWENDOLYN
KIM and HUBERT MACK
HEMBREE.
D081110
GWENDOLYN KIM HEMBREE,
Appellant, (18FL010278N)
v.
HUBERT MACK HEMBREE,
Respondent.
APPEAL from an order of the Superior Court of San Diego County,
Robert C. Longstreth, Judge. Affirmed.
Law Office of Dennis Temko and Dennis Temko for Appellant.
Hubert Mack Hembree, in pro per. for Plaintiff and Respondent.
Plaintiff Gwendolyn Kim Hembree (Kim) and defendant Hubert Mack
Hembree (Mack) were married for more than 34 years until their divorce in
August 2019. In December 2019, the parties voluntarily attended a
mediation (with their respective counsel) that led to an enforceable marital
settlement agreement in which they agreed to a division of their community
estate. In March 2020, that agreement was incorporated into a stipulated
judgment.
In August 2020, Kim filed a request for order to set aside the judgment
under Family Code1 section 2122, or alternatively, to enforce the judgment
and divide assets under section 2556. In her motion, Kim claimed
community assets had been omitted from the marital settlement agreement,
Mack had misrepresented the value of certain of those assets and/or had
failed to disclose others, and the division of assets was one-sided in Mack’s
favor. About a month later, Mack filed his own request for order, claiming
Kim was in breach of the marital settlement agreement. After a lengthy trial
in this “highly contested” litigation,2 the trial court issued a statement of
decision and order denying Kim’s motion, and denying in part and granting
in part Mack’s motion.3
1 All further undesignated statutory references are to the Family Code.
2 The appellant’s appendix includes 86 volumes and is over 24,000 pages.
The reporter’s transcript is seven volumes and exceeds 1,100 pages.
3 Mack has not filed a cross-appeal.
2
On appeal, Kim contends the trial court erred when it found (1) she
received the benefit of her bargain under the settlement agreement with
respect to a promissory note issued by Kurmac, Inc., dba Gems N’ Loans
(Kurmac), an asset belonging to the parties that operated pawnshops in
California, and (2) the assets she claimed were omitted were either
adjudicated in the parties’ marital settlement agreement, or did not belong to
the community, or even if a community asset, provided no value to it.
As we explain, we conclude the trial court did not err in denying Kim’s
motion. We thus affirm its August 22 order.4
I. FACTUAL AND PROCEDURAL BACKGROUND
A. Overview
Mack and Kim married in December 1983 and separated in
March 2018. There were no children from this marriage, which terminated
on August 2, 2019, upon entry of a status only dissolution judgment. Both
parties have since remarried.
4 Mack, appearing in propria persona, has filed a five-page respondent’s
brief that does not comply with various rules of appellate procedure,
including that points must be supported “by argument and, if possible, by
citation to authority” (Cal. Rules of Court, rule 8.204(a)(1)(B)), and that the
brief must include citations to the volume and page number of the record
when referencing a matter (id., (a)(1)(C); see Stover v. Bruntz (2017) 12
Cal.App.5th 19, 31 [“ ‘as is the case with attorneys, [self-represented]
litigants must follow correct rules of procedure’ ”]). Because the burden to
show error is on Kim, we decide this appeal on the merits based on the
record. (See Carboni v. Arrospide (1991) 2 Cal.App.4th 76, 80, fn. 2 [“[s]ince
the burden is always on the appellant to show error,” “we . . . examine the
record on the basis of appellant’s brief and reverse only if prejudicial error is
found”].)
3
From 2011 until separation, Kim resided primarily in Maui, Hawaii,
managing a vacation rental business she and Mack owned called Hembree
Vacation Rentals (HVR),5 while Mack resided in Oceanside, California,
managing Kurmac’s pawnshop business. Kurmac and HVR were the parties’
two main community assets. Another asset of significance in this appeal is a
promissory note Kurmac issued to Mack in December 2014 in the amount of
$3,220,807.77, bearing interest at six percent with the entire note due and
payable in December 2026.
B. Mediation, the Marital Settlement Agreement, and Entry of
Judgment
On December 9, 2019, the parties, their respective counsel, and Kim’s
retained financial expert participated in a mediation at JAMS with retired
Judge Thomas R. Murphy. The all-day mediation culminated in a signed
12-page marital settlement agreement (MSA) hand-written by Judge
Murphy.
1. Kim’s Assets
The MSA provided Kim would receive as her sole and separate property
the following assets: (1) The “sum of $250,000 which shall be paid by Mack to
Kim within 14 days after the signing of this agreement.” (2) “The 3,000,000
note payable to Mack and Kim and payable by Kurmac.[6] Mack and the
corporation shall personally guarantee the note and shall guarantee
5 Beginning in about early 2012, the Hembrees purchased three rental
properties in Maui, Hawaii: the “Halama” house, a 5,000 square-foot home
with a separate “granny flat,” and two condominium units in a high-rise
building in Wailuku.
6 This appears to be a reference to the December 2014 Kurmac note,
although that note was payable to Mack only.
4
personally that Kim shall receive the sum of $15,000 or more per month. No
interest on the $3,000,000 note. Should any 2 payments be missed, the
balance shall become due and payable. Should Mack’s interest in Kurmac,
Inc., be sold prior to the payoff of the $3,000,000 note, the balance then due
on the note shall become due and payable. Mack shall further make
arrangements in his Estate Planning (Will, Trust, etc.) to insure the
guarantee of the above payments to Kim.” (3) The “sum of $2,000,000 first
upon the close of escrow of the real property located [on] . . . Halama Street in
[Hawaii].” (4) The gold in her possession. (5) The parties’ interest in a
condominium located in Oceanside, “with the understanding that Mack shall
pay $100,000 from the sale of Halama towards the outstanding
mortgage . . . .” (6) The IRA in her name. (7) The parties’ interest in a
Carlsbad timeshare. (8) One-half of the parties’ interest in a mobile home
located in Mexico.
2. Mack’s Assets
The MSA provided Mack would receive as his sole and separate
property the following assets: (1) “Any and all stock the parties may have or
interest in, in the corporation known as Kurmac, Inc. Mack shall assume and
hold Kim harmless from any debt associated with Kurmac, Inc. which the
parties or either one of them may be responsible for, including the existing
Line of Credit which currently amounts to between $1,500,000–$2,000,000.”7
(2) The two Wailuku properties, which properties the parties also had
previously agreed to sell. (3) The Halama property, with Mack retaining “any
contractual rental deposits and income for the rental” until its sale, and
7 Kim, Mack, and the Hembree Family Trust each guaranteed payment
of what was then Kurmac’s $4 million line of credit. After 2020, Kim no
longer was a guarantor of the credit line.
5
thereafter paying Kim’s mother $195,000 from the proceeds. (4) An “ESOP
note[8] payable to the parties with a current balance in the sum of $536,000
+/-.” (5) Kurmac’s corporate offices located in a commercial property on North
Coast Highway in Oceanside. (6) An IRA in his name of about $18,000. (7)
The other half of the Mexican mobile home.
In addition to the division of assets, the parties in the MSA expressly
agreed to a “mediation waiver” “should a dispute arise re[garding] the
interpretation or enforcement of this agreement”; and to a general waiver
“full[y] resol[ving]” all “claims against the other” including those based on
breach of fiduciary duty.
3. Stipulated Judgment
Kim in late February 2020 executed a declaration consenting to entry
of judgment under the terms and conditions of the MSA. In March 2020, the
trial court granted Mack’s unopposed ex parte application to enter the
judgment (on reserved issues) under Code of Civil Procedure section 664.69
(Judgment).
8 In December 2014 Kurmac’s employee stock ownership plan agreed to
pay Kim and Mack $1.5 million for 30 percent of their outstanding shares of
Kurmac common stock, secured by a promissory note.
9 Code of Civil Procedure section 664.6, subdivision (a) empowers the
trial court to enter judgment “pursuant to the terms” of the parties’
settlement agreement.
6
C. Requests for Orders
In August 2020 Kim, through her newly retained guardian ad litem
(GAL),10 filed a request for order to set aside the Judgment under section
2122 on the grounds of fraud, duress, lack of mental capacity, mistake, and
failure to comply with disclosure requirements; or alternatively, to enforce
the Judgment and divide omitted assets under section 2556 (Motion). Kim
(through her GAL) contended in her Motion that Mack received about $7
million in community assets compared to her receipt of about $2 million; that
many of her bills were in collection; and that Mack had failed to comply with
the Judgment, including, as relevant to this appeal, allegedly missing two
$15,000 monthly payments, which Kim contended caused the entire
$3,000,000—less payments already made—to become due and payable.11
10 Attorney Sharon Blanchet acted as Kim’s GAL between July 2020 and
October 2022. Kim maintained a GAL was necessary because she suffered
from “various mental health issues, including but not limited to Major
Depressive Disorder. These conditions compromise[d] her cognitive
functioning in several domains, including but not limited to memory,
attention, concentration, organization, planning, and mental processing.” In
denying Kim’s motion to set aside the Judgment, the trial court found it
“telling” that, although the GAL “stood in Kim’s shoes as the client directing
the litigation and as the client for whose benefit the litigation was brought,
[the GAL] did not testify, or otherwise provide any information suggesting
that the settlement was unfair, or, except through arguments of counsel,
provide any other information to the Court on the issues presented in this
matter. Kim, by contrast, testified at length, despite her contention, and the
Court’s necessary finding in making the [GAL] appointment, that her lack of
competence has been such that she need[ed] a [GAL] in this matter.”
11 Mack’s first “missed” payment was in May 2020, when he inadvertently
deposited $15,000 into Kim’s attorneys’ client trust account. The second
“missed” payment was in July 2020 (based on the GAL’s August 7, 2020
declaration). Kim on appeal no longer contends Mack missed any of the
$15,000 monthly payments.
7
Kim contended the Judgement should be set aside under section 2122
because Mack committed fraud based on his alleged intentional
underreporting of the value of certain assets including Kurmac; perjury,
based on his alleged “untruthful statements” including the amount of his
monthly income; duress, based on Mack’s new wife’s alleged “public bullying”
of Kim shortly before the mediation; mental incapacity, based on medical
records showing Kim had been “institutionalized” and thus lacked the
requisite capacity to enter into the MSA; mistake of fact/law, based on her
inability to “support herself” at the “marital standard of living” and her lack
of understanding of the “mediation process”; and failure to disclose, based on
the alleged “substantive deficiencies” in Mack’s disclosure declarations.
Alternatively, Kim argued the Judgment should be enforced and a
“number” of allegedly omitted assets divided. In addition, she sought spousal
support in a reasonable amount up to the date she remarried (May 5, 2022),
an “interim” award of attorney fees of $100,000, and sanctions against Mack.
Mack in response filed his own request for order. He claimed Kim
breached the MSA including by failing to pay the mortgages, HOA dues, and
expenses on the Hawaiian properties through March 15, 2020; and the
mortgage, property tax, HOA dues, and ongoing expenses on the Oceanside
condominium, causing that property to go into foreclosure, and negatively
impacting his credit and Kurmac’s credit line. Mack further requested the
trial court stay, pending his motion to quash, the voluminous discovery
propounded by Kim in connection with her Motion, and impose sanctions
against Kim for her alleged bad-faith conduct.
D. May 2022 Trial
During opening argument, Kim’s counsel explained the legal effect of
her Motion, stating if the court set aside the Judgment, the parties would
8
“start over”; and if the Judgment was not set aside, the court then would
“need[] to determine what’s not contained within the Judgment, because
there’s an allegation of omitted assets and debts.”
Mack’s counsel described the long history of litigation after the parties’
separation. This history included the parties’ competing unsuccessful
motions to take over each other’s business operations in Kurmac and HVR,
which led to the trial court’s February 2019 appointment of Brian Brinig as
its Evidence Code section 73012 valuation expert.
1. Brinig’s Business Valuation
Brinig testified his appointment included valuing Kurmac, HVR, a
company called Riverock, Inc. (Riverock),13 and any other business in which
the parties had an interest. After his appointment, Brinig requested a series
of documents from the parties to conduct his valuation analysis, which
request was followed-up by an August 2019 court order. The order required
Mack to submit Kurmac’s audited financial statements for the year ending in
2018 and, if unavailable, the company’s “internal financial statements
(balance sheet and income statement)” for the same year; and to describe the
business of Riverock, submit financial statements for this business “from its
12 Evidence Code section 730 provides in part: “When it appears to the
court, at any time before or during the trial of an action, that expert evidence
is or may be required by the court or by any party to the action, the court on
its own motion or on motion of any party may appoint one or more experts to
investigate, to render a report as may be ordered by the court, and to testify
as an expert at the trial of the action relative to the fact or matter as to which
the expert evidence is or may be required.” (Evid. Code, § 730.)
13 The record shows “Riverock” was also sometimes referred to as
“Riverrock” and “River Rock.”
9
inception to the present time” (including any interim financial statements),
and summarize his “financial investment(s)” in Riverock.
As to the former, Brinig testified there were no audited financial
statements for Kurmac. Mack, however, provided reviewed financial
statements for the company for the years 2014 through 2017, and internal
financial statements for 2018. As to the latter, Brinig relied on Mack’s
representation that he had no interest in Riverock, as Mack claimed the
company belonged to his daughter and he had no access to the company’s
financial records. Brinig therefore did no investigation or valuation of
Riverock before the mediation, including the source of funds for the business,
as he considered Riverock “[o]ff the table.”
In late October 2019, Kim’s counsel emailed Brinig asking whether he
had any information about two other companies Mack had listed on his
declarations of disclosure, Laurel, Inc. (Laurel) and “Laurel One.”14 Brinig
responded he had no information regarding either company.
Despite not having all the requested information, Brinig completed his
first business valuation about a week before the parties’ December 2019
mediation. Brinig added he prepared this valuation “very quickly” while
“under the gun,” and he included neither Riverock nor Laurel in his report.
The trial court in late 2020 reappointed Brinig as its expert to make
additional recommendations, after the parties had filed their competing
motions. Brinig’s initial tasks included determining what the parties “knew
at the time they entered into the [MSA] about each party’s income”;
“[a]ccounting, economic and discovery issues related to finances, includ[ing]
14 The parties agreed and the trial court found that Laurel One and
Laurel were the same entity, as Mack’s inclusion of Laurel One in his
preliminary disclosure was a “typo.”
10
but not limited to Laurel”; and any change in circumstances as to their
financials. In March 2021, Brinig notified the parties he was still waiting to
receive supplemental documents from them to complete these tasks.
Brinig’s assignment changed in May 2021, when the trial court instead
requested he value each of the assets in the MSA. Brinig in late May 2021
sent the parties his preliminary valuation analysis. He “left blank spaces for
the majority of the assets” because he “never had information on the values of
those assets and no values are set forth in the [MSA]”; and because his pre-
mediation services had been limited to a business valuation of Kurmac as of
December 2019, and an income for support analysis for Kim and Mack.
Based on the court’s May 2021 order, Brinig asked the parties to provide
“evidence of value” for each of the assets in the MSA.
In June 2021, Brinig notified the parties, the trial court, and the
parties’ discovery referee that he was limiting his valuation of the MSA
assets to Kurmac. His decision resulted from the parties’ ongoing “significant
disputes” regarding the division of their estate; the lack of evidence of values
for certain assets and the conflicting evidence for others; and the parties’
suggestion that the scope of his new assignment included valuing “all assets”
in existence on the date of mediation, “ ‘whether or not they were previously
disclosed,’ ” in order to obtain a “true value” of their estate. Brinig also listed
11 assets identified by the parties that allegedly had not been divided under
the MSA, including Riverock and Laurel. Brinig noted he also could not
value these 11 assets due to a lack of evidence regarding their “existence” or
“financial status.” Brinig testified this letter was necessary because the
parties were “arguing about all kinds of stuff that [he could not] solve.”
Brinig therefore never completed an evaluation of Riverock or Laurel.
11
2. Kim’s Testimony
In mid-April 2019, after the parties had separated, they agreed to sell
the Hawaiian properties including the Halama house, which Kim considered
to be her primary residence.
Kim testified that before the mediation, she never saw Brinig’s
preliminary business valuation report. Kim at the time felt very intimidated
by Mack, and was experiencing significant mental health challenges.
Kim recalled that before mediation, Riverock was “brought up as an
issue” for Brinig to “investigate,” after she found the company’s “books” in
Mack’s “private safe.” She acknowledged that Riverock’s bank statements
were listed in the index of proposed exhibits attached to her mediation
brief;15 and that during a November 13, 2019 hearing, she inquired about
Riverock, explaining she understood that Mack claimed he had no interest in
the company.
Kim also was aware of Laurel, testifying she and Mack had
“personally” “loaned Kurmac money through” this company. Kim added, “The
way Mack explained it to me was that it was better for us to loan the money
and then get repaid by Kurmac and we wouldn’t have a tax consequence”;
that Mack “was all into the LLCs and getting the best tax advantages,” and
she was “not really aware of all that, except for that the corporation did
exist”; and that Mack wanted to pay his disabled sister a small salary
through this company. Kim testified neither Riverock nor Laurel was
included in the MSA.
15 We note Kim’s mediation brief also included as an attachment a chart
of assets and debts identifying Riverock as Mack’s asset with a value of
$102,561.
12
Kim recalled she and Mack put $3 million into Kurmac in about 2014
and Kurmac in return issued a promissory note at six percent interest (i.e.,
the Kurmac note). Kim testified she believed the $15,000 she received
monthly under the MSA was the “interest” on that note. When asked to
explain why the MSA provided there was “no interest” with respect to this
asset, Kim testified, “I believe that the agreement said that Mack was to pay
no interest, but that didn’t let Kurmac off the hook. It was a Kurmac note.”
Regarding the December 9, 2019 mediation, Kim was accompanied by
counsel,16 a close friend, and retained financial expert Jerry Whitehead, who
owned a pawnshop consulting company. Kim testified she retained
Whitehead because she had not been given a value of Kurmac’s pawnshops,
and “he was there to help [her] look at the evaluation if it ever came up and
give [her] input as to if it was a correct value or if they used the right
methods or whatever.” The parties initially were seated together and the
mediator used a whiteboard to list their assets. Once separated, Kim recalled
the mediator went back and forth between rooms “trying to put some type of
deal together.”
Kim’s intention since the parties’ separation was to split up the five
pawnshops owned by Kurmac, with Mack and her each taking two and the
remaining shop being sold and the proceeds divided, thus allowing for an
even division of the asset. Mack, however, had rejected that idea all along,
and Kim therefore was not surprised when Mack disagreed with this proposal
at the mediation.
16 Kim, acting alone and not through her GAL, filed a lawsuit against the
attorney who had represented her at the mediation, seeking damages in
excess of $7.5 million for what she alleged was the “disastrous” MSA.
13
As the mediation progressed, Whitehead provided input regarding
Brinig’s valuation of Kurmac. Kim testified Whitehead approved of Brinig’s
valuation, noting it “was done the way an evaluation should be done.”
Kim estimated the mediation concluded at about 7:00 p.m., after her
counsel encouraged her to accept the settlement. Kim testified during the
mediation she was “zeroed in” on when she would have to vacate the Halama
house, as Mack wanted her to move in February 2020 and, not to feel rushed,
she negotiated to stay until March 15, 2020. Before signing the MSA, her
counsel told her that if she subsequently disagreed with its terms the
settlement could be set aside. Kim, however, then did not understand that
the MSA was a “binding” agreement.
Regarding the Judgment, Kim testified on her counsel’s advice she
signed a declaration on February 24, 2020, allowing its entry on March 5.
At the time of the May 2022 trial, Kim had received $1.75 million17 in
cash under the MSA in addition to the monthly $15,000 payments. She
admitted she had “[v]ery little” of the money left, estimating it was less than
$100,000; and that, if the trial court set aside the Judgment, she had no
ability to “put that money back in the pot.”
3. Mack’s Testimony
Mack testified that at the outset of the mediation, Judge Murphy used
a whiteboard and listed the “total community assets one by one,” and had the
parties both agree on the value of each one of those assets, totaling about
$10,640,000; and that under the MSA Kim received $5.45 million while he
received $5.32 million. Mack recalled that during the mediation Kim made
17 Out of Kim’s $2 million distribution from the sale of the Halama house,
the trial court in November 2020 ordered $500,000 withheld and placed in
her attorney’s client trust account pending resolution of Mack’s
reimbursement claims against her.
14
various settlement proposals that he did not agree to, including that she
would receive an interest in Kurmac.
Regarding his $3 million payment to Kim outlined in the MSA, Mack
testified it is “a note in favor of Kim Hembree to—that figure was done so
that her assets would equal half of the total assets. The note was kind of an
adjustment thing to make things equal,” as he “didn’t have the cash” to pay
Kim a lump sum of $3 million. Mack added there was never a “separate
note” in existence in Kim’s favor.
Mack was asked about the notation on the whiteboard of “$3 million
note/guarantee, [$]15,000 a month.” He testified, “I understand that to mean
that was an obligation payable 15,000 a month, no interest”; and that it had
to be “no interest” because otherwise the payments would be “beyond what
[he] could manage.” Mack confirmed that $15,000 a month up to $3 million
was a “principal payment”; that under the MSA he was required to personally
guarantee the monthly payment even if Kurmac was sold; and that he
changed his estate planning documents to guarantee the monthly payments
to Kim, as required under the MSA.
Mack testified he had complied with all of the terms of the MSA,
including making all the monthly payments to Kim.
Regarding the Halama property, it ended up selling for $5.8 million,
considerably less than its list price of $7.2 million due to a problem with a
seawall and a sinkhole Mack claimed Kim had allegedly failed to disclose.
Pursuant to the MSA, Kim received $2 million from the sale and Mack a little
more than $900,000. Although under the MSA Kim was responsible to make
the mortgage payments on the Halama house through March 15, 2020, when
Mack took over the property he discovered it in arrears.
15
Regarding Riverock, Mack acknowledged he told Brinig in September
2019 he had no interest in the company, as it belonged to his daughter Bari
Hembree (Bari). Mack testified the purpose of the company was to “help”
Bari. Mack put $200,000 into the company sometime in 2018, confirmed the
money was a “gift,” and, although he became an officer and sat on the board,
he testified the company belonged to Bari and the money was hers to do what
she wanted. Mack also testified he might have been a shareholder in
Riverock, although he believed no shares ever issued. He confirmed Bari was
listed as the sole shareholder in a March 6, 2018 document titled,
“Resolutions Adopted by Sole Director and Shareholder,” and listed as the
“sole owner” of Riverock when she completed a business account application
at a Colorado bank in August 2018.
Regarding Laurel, Mack testified he created the company about 20
years earlier in part to benefit his disabled sister, and all of the money
invested in Laurel came from him. He claimed the company had “no value,”
as Laurel had loaned Kurmac $380,000, which Kurmac then paid back
through its line of credit, which money Mack then reinvested in Kurmac.
Mack added that Kim was not responsible for any of the money drawn from
Kurmac’s credit line.
Regarding the reason for the $380,000 note, Mack explained, “Cash
flow goes back and forth[.] [M]y business has strange needs. It goes up and
down all the time, depending on the public’s need[] to borrow money, and so I
loan money from myself, Kurmac, and just when it’s convenient, wherever
the money is, switch back and forth”; and that he set up Laurel after
attending a seminar on “asset protection,” but the company “never really did
anything.”
16
4. The Trial Court’s Oral Ruling and Statement of Decision
a. Ruling from the Bench
On May 27, 2022, the trial court issued its tentative decision by oral
statement, refusing to set aside the Judgment. The court found a failure of
proof by Kim to show any purported misrepresentations by Mack were
“material or would have resulted in any different outcome” in the division of
assets; that, in balancing the interest of finality against the equities for
reopening the case, the scale was “overwhelming” in favor of finality; that
there was not a “single fact” that Kim presented during the trial that she
could not have presented before the settlement; and it had “zero confidence”
that, if it set aside the Judgment, Kim would achieve a “better result,” as it
did not believe the distribution of community assets was “unfair” or that a
new allocation “wouldn’t be more than a trivial difference” from the allocation
in the Judgment.
As relevant to this appeal, the trial court found there was no mistake
as to the Kurmac note, as Kim was receiving exactly what she bargained for
under the MSA: the “value of that note . . . established as $3 million, paid out
over 15 years[.]” (Italics added.) The court therefore refused to “rewrite” the
parties’ agreement regarding this asset.
Regarding Riverock, the court found this asset belonged to Bari, as
Mack had given the money to her as a “gift” “to do whatever she wanted to”
do with it. Finally, regarding Laurel the court found the $380,000 note was
actually a debt owed by Kurmac that Mack was “transferring back” between
the two companies with no “net” effect on the community.
The trial court issued its statement of decision (SOD) on August 5,
2022, after Kim filed nearly 50 objections to Mack’s proposed statement of
decision. The court found the parties’ December mediation at JAMS resulted
17
in “an agreement settling all issues” between them; and reiterated that “Kim
did not present any material facts at trial that were not known before, in
large part well before, the Judgment was entered.”
b. Credibility
In its SOD, the trial court found Kim’s testimony not credible, noting,
“If it was convenient for her to provide truthful testimony she did. If it was
not, she did not. For example, she professed a good recall of details that were
beneficial to her legal position, and a lack of recall of details that might
contradict her legal position.”
As to Mack, the court found his testimony to be credible on “material”
issues; that, while Kim established certain statements by Mack “prior to the
entry of the Judgment were false, and while . . . the Court finds that she
knew of the falsity of these statements before the Judgment was entered, she
did not establish that any material testimony given at trial under oath was
false.”
c. Set Aside
In denying Kim’s Motion to set aside the Judgment, the trial court in
its SOD balanced the interest of assuring the finality of a final judgment
against the proper division of marital property. It found Kim pre-Judgment
was fully aware of the issues she litigated in her Motion, including her claims
that material information was not disclosed by Mack, and despite that
knowledge, she “consciously and voluntarily” chose not to raise them, both
“before and after she voluntarily reached an agreement at the mediation[.]”
The court was unaware of any authority allowing a judgment to be set aside
under these circumstances, and found Kim provided no such authority.
18
The trial court also found Kim failed to establish that the parties’ MSA
was an “unfair” division of assets or that she would have “obtain[ed] a better
result in subsequent proceedings if the Judgment were set[]aside,” adding,
“[T]o the contrary, both parties would be worse off if the Judgment were set
aside, and the parties were required to expend further resources to obtain a
result that the Court believes would far more likely than not result in a
division of the marital estate that would be equally or less favorable to Kim.”
The court also questioned whether Kim “could restore the parties to the pre-
settlement state of affairs” if the Judgment was set aside, and found she had
never offered to do so.
As to Mack, the trial court found he did not “omit[] material facts and
information in the underlying dissolution action,” and any purported failure
by Mack to fulfill his disclosure requirements was “immaterial.” The court
made these findings as to Kurmac, Riverock, and Laurel.
As to Riverock, the trial court found it “was not a community asset at
the time of the mediation or the entry of the Judgment,” but instead belonged
to Bari “at all relevant times”; and Kim knew about this asset before the
mediation, had every opportunity to then investigate and address it, but did
not do so. The court also found even after the litigation Kim was unable to
establish Riverock was a community asset; and rejected what it determined
was Kim’s “new” claim that she did not consent to the “gift through which
Riverrock was funded,” noting Kim did not argue that Mack wasted
community assets or breached a fiduciary duty by making this “gift,” “or that
he lacked the power to make gifts without her consent.”
Regarding Laurel, the trial court found Kim conceded that Mack had
disclosed this asset, but allegedly not the $380,000 note Kurmac owed the
company. The court noted that, even if the note was a community asset, the
19
court found it was offset in the same amount by a community debt, inasmuch
as it was “undisputed” that Mack was responsible for, and paid, any such
debt; and that she presented no evidence to support a finding that the
“existence of the note or anything else related to Laurel” would have affected
the total community assets “less debts available for distribution.”
As relevant to this appeal, the trial court also rejected Kim’s claim the
Judgment should be set aside due to mistake. It found both parties were
“fully aware” of what was being discussed at the mediation, including what
the “material assets” were, their value, and how they would be divided.
As to the Kurmac note, the trial court found Kim knew the “material
facts” about this asset, including the various positions the parties had taken
over its value; they “reached a mutual understanding” of what she could
expect to receive from this asset in the overall division of the estate; and she
“specifically bargained” over this asset based on Brinig’s valuation of Kurmac
as of December 31, 2018. The court thus found a “valid meeting of the minds
with respect to the [Kurmac] note: “$3,000,000 to [Kim to] be paid out at
$15,000 each month, without interest.”
d. Omitted Assets
The trial court found the Kurmac note was not omitted, as this asset
was specifically bargained over by the parties at the mediation and included
in the Judgment.
As to Riverock, the trial court found it also was not omitted because the
company belonged to Bari and not the community. The court also found the
community had no right to reimbursement for the “gift” of funds to Bari,
which claim, in any event, Kim had “waived” in the MSA.
Regarding Laurel, the trial court found it too was not omitted, as this
asset was “disclosed and addressed at the mediation,” and that Kim also
20
failed to demonstrate that “any value attributed to Laurel was other than a
bookkeeping artifact, or that the treatment in the Judgment of anything
related to Laurel disadvantaged her.”18
II. DISCUSSION
A. Mistake and the Kurmac Note
As she did in the trial court, Kim contends on appeal that the court
erred when it refused to set aside the Judgment based on mistake of law
and/or fact because she believed she was receiving not only a guarantee from
Mack to make monthly payments of $15,000 up to $3 million, but also the
Kurmac note itself. At the time of the mediation, Kim valued the note at $2.7
million, whereas Mack valued it at $2.95 million.
As noted, Kurmac executed the promissory note on December 31, 2014,
“pay[able] . . . to H. Mack Hembree” in the amount of $3,220,807.77 and
bearing interest at six percent until paid, with the “[e]ntire note” “due and
payable on 12/1/26.”19
With regard to this asset, section 1(b) of the MSA (Section 1(b))
provided Kim would receive as her separate property: “The $3,000,000 note
payable to Mack and Kim and payable by Kurmac, Inc. Mack and the
corporation shall personally guarantee the note and shall guarantee
personally that Kim shall receive the sum of $15,000 or more per month. No
interest on the $3,000,000 note. Should any 2 payments be missed, the
18 The trial court also found Kim had “abandoned” her claim that other
assets were omitted from the Judgment, including several vehicles, precious
metals, and tax refunds for the year 2019. Kim has not challenged this
finding on appeal.
19 The Kurmac note was signed by Mack as CEO of Kurmac and by Laura
Cortez as company secretary. In a separate notation the note provided it was
due on “12/31/26.”
21
balance shall become due and payable. Should Mack’s interest in Kurmac,
Inc., be sold prior to the payoff of the $3,000,000 note, the balance then due
on the note shall become due and payable. Mack shall further make
arrangements in his Estate Planning (Will, Trust, etc.) to insure the
guarantee of the above payments to Kim.”
1. Guiding Principles
Section 2122 governs motions to set aside a judgment or part thereof in
dissolution proceedings. To set aside a judgment based on mistake, the
mistake may be “either mutual or unilateral, whether mistake of law or
mistake of fact.” (§ 2122, subd. (e).) “ ‘In addition to establishing mistake,
the party seeking relief must also establish that “the facts alleged as the
grounds for relief materially affected the original outcome and that the
moving party would materially benefit from the granting of the relief.” ’ ”
(In re Marriage of Binette (2018) 24 Cal.App.5th 1119, 1125 (Binette); accord,
In re Marriage of Kieturakis (2006) 138 Cal.App.4th 56, 88–89 (Kieturakis) [a
party moving under section 2122 bears the burden of proving entitlement to
relief].)
We review a trial court’s order denying a motion to set aside a
judgment under section 2122 for abuse of discretion (Binette, supra,
24 Cal.App.5th at p. 1125) and its factual findings for substantial evidence,
resolving all conflicts and drawing all reasonable inferences in favor of the
decision (In re Marriage of Kamgar (2017) 18 Cal.App.5th 136, 144.) Under
substantial evidence review, we examine the evidence in the light most
favorable to the prevailing party and do not reweigh the evidence or
reconsider credibility determinations. (In re Marriage of Calcaterra &
Badakhsh (2005) 132 Cal.App.4th 28, 34 (Calcaterra & Badakhsh).)
22
Here, Kim’s alleged mistake as to the Kurmac note turns in part on her
interpretation of Section 1(b), which requires us to apply principles of
contract interpretation. (In re Marriage of Rose & Richardson (2002) 102
Cal.App.4th 941, 948–949) [“ ‘The meaning and effect of a judgment is
determined according to the rules governing the interpretation of writings
generally.’ ”].) “ ‘Where an ambiguity exists, the court may examine the
entire record to determine the judgment’s scope and effect. [Citations.] The
court may also “ ‘refer to the circumstances surrounding the making of the
order or judgment, [and] to the condition of the cause in which it was
entered.’ ” ’ ” (Ibid.)
“The ultimate construction placed on [a] contract might call for
different standards of review. When no extrinsic evidence is introduced, or
when the competent extrinsic evidence is not in conflict, the appellate court
independently construes the contract. [Citations.] When the competent
extrinsic evidence is in conflict, and thus requires resolution of credibility
issues, any reasonable construction [following a trial] will be upheld if it is
supported by substantial evidence.” (Iqbal v. Ziadeh (2017) 10 Cal.App.5th 1,
8 (Iqbal); accord, Estate of Williams (2007) 155 Cal.App.4th 197, 205–206
(Williams) [“ ‘Where . . . extrinsic evidence is properly received, and such
evidence is conflicting and conflicting inferences arise therefrom, the
appellate court will accept or adhere to the interpretation adopted by the trial
court provided that that interpretation is supported by substantial
evidence.’ ”].)
2. Analysis
Kim argues that the trial court erred in refusing to set aside the
Judgment based on her mistaken belief that it awarded her both the Kurmac
note and a guarantee by Mack to pay her a minimum of $15,000 a month up
23
to the sum of $3 million, rather than just the latter. However, Kim’s claim of
mistaken belief was based primarily on her own testimony regarding her
subjective understanding of the Judgment, which the trial court found not to
be credible. We cannot second-guess the trial court’s credibility finding on
this issue. (Estate of Berger (2023) 91 Cal.App.5th 1293, 1309.)
Other evidence supports the trial court’s ruling as to the absence of any
mistake by Kim regarding the Kurmac note. Although the language of the
Judgment is not a model of clarity, it stated that Kim would “receive the sum
of $15,000 or more per month” with “[n]o interest on the $3,000,000 note.”
Because the Kurmac note itself required payment of six percent interest to
Mack as the creditor, the provision stating that Kim would receive “no
interest” is inconsistent with her theory that she was awarded the note itself.
Moreover, the Judgment made no provision for the parties to amend or
transfer the Kurmac note from Mack to Kim or take other appropriate action
to substitute Kim for Mack as the creditor—nor is there any evidence that
Kim ever made any such request after the Judgment was entered. Finally,
Mack testified that his understanding of the Judgment was that Kim did not
receive the Kurmac note itself, but only the value of that note to make the
division of the parties’ estate equal; that he guaranteed to pay Kim $15,000 a
month, “no interest,” up to $3,000,000; and that the monthly payment was
principal only because he could not afford this payment if it included interest.
Unlike Kim’s testimony, the court found Mack’s to be credible.
The record therefore shows a conflict in the evidence regarding Kim’s
allegedly mistaken interpretation of Section 1(b). (See Iqbal, supra, 10
Cal.App.5th at p. 8; Williams, supra, 155 Cal.App.4th at pp. 205–206.) The
trial court resolved this conflict in part by finding Kim’s testimony not
credible and by examining the circumstances surrounding the MSA and
24
resulting Judgment, concluding that Mack’s construction reflected the
parties’ intent when entering into the MSA. (See Civ. Code, § 1636 [“A
contract must be so interpreted as to give effect to the mutual intention of the
parties as it existed at the time of contracting, so far as the same is
ascertainable and lawful.”].) Specifically, the trial court found Kim knew the
“material facts with respect to the Kurmac note,” including the various
positions the parties had taken over its value, and that “the parties reached a
mutual understanding” that Kim would receive “$3,000,000, to be paid out at
$15,000 each month, without interest.”! (AA 1441-1442)! The court thus
found a “valid meeting of the minds with respect to the [Kurmac] note.
We conclude the trial court’s findings are supported by substantial
evidence. Indeed, the record shows before the mediation both parties
identified the Kurmac note in their list of community assets and debts. At
the mediation, Kim, with counsel and her own financial expert present,
expressly negotiated over the note, at one point proposing she receive “half
the note” and Mack receive the Kurmac business, which proposal he rejected.
The evidence that Mack rejected Kim’s proposal to receive “half the note”
further supports an inference that the parties did not intend Kim to receive
the entire note plus the guarantee. Accordingly, the record supports the trial
court’s findings that Kim was “fully aware” of the “material facts” regarding
this asset and Kurmac in general, which Brinig had valued for purposes of
the mediation as of December 31, 2018; that the parties reached a “mutual
understanding” of what she would receive from the Kurmac note in the
overall division of their estate; and that Kim did not have any mistaken belief
as to terms of the Judgment regarding the Kurmac note.
25
What’s more, because the parties voluntarily divided their property
interests through mediation resulting in the MSA and Judgment, the trial
court did not need to concern itself with whether that division was equal.
(See e.g., § 2550 [equal division of community property is required “[e]xcept
upon the written agreement of the parties, or on oral stipulation of the
parties in open court”]; Mejia v. Reed (2003) 31 Cal.4th 657, 666
[“Whenever . . . the parties agree upon the property division, no law requires
them to divide the property equally, and the court does not scrutinize the
[marital settlement agreement] to ensure that it sets out an equal division.”].)
Nonetheless, the court in the instant case found the parties’ division of the
community estate was fair and equitable, inasmuch as Kim not only would be
receiving monthly checks of $15,000 up to $3,000,000, but also received lump-
sum payments of $2,000,000 and $250,000; $100,000 towards the mortgage
on the Oceanside condominium she retained; and relief from $195,000 of
community debt Mack paid to her mother. We thus conclude the trial court
did not abuse its discretion when it refused to set aside the Judgment based
on any purported “mistake” with respect to this asset. (See Binette, supra, 24
Cal.App.5th at p. 1125.)
We further conclude substantial evidence supports the trial court’s
finding that the public policy favoring the finality of judgments outweighed
Kim’s interest in having the Judgment set aside. (See § 2120, subd. (c) [“The
public policy of assuring finality of judgments must be balanced against the
public interest in ensuring proper division of marital property, in ensuring
sufficient support awards, and in deterring misconduct.”]; In re Marriage of
Varner (1997) 55 Cal.App.4th 128, 136–137 (Varner) [quoting subdivision (c)
of section 2120].)
26
The parties have been vigorously litigating the division of their
community estate since 2019, as evidenced by the size of the appellate record
in this case. In addition, the Judgment incorporating the MSA was entered
more than three years ago in March 2020, after Kim consented to its entry.
And, as Kim herself recognized, if the Judgment was set aside, she did not
have the ability to put the money she has already received “back in the pot.”
Based on the public policy afforded the finality of judgments, we conclude on
this record that the trial court did not abuse its discretion when, for this
separate reason, it denied Kim’s Motion, and that substantial evidence
supports its decision. (See § 2120; subd. (c); Varner, supra, 55 Cal.App.4th at
pp. 136–137; see also Calcaterra & Badakhsh, supra, 132 Cal.App.4th at p.
34 [under substantial evidence review we examine the evidence in the light
most favorable to the prevailing party].)
B. Omitted Assets and the Kurmac Note
Kim alternatively contends that, if the Judgment is not set aside under
section 2122, subdivision (e) based on mistake, the trial court erred in failing
to treat the Kurmac note as an omitted asset under section 2556.
1. Guiding Principles
Section 2556 provides: “In a proceeding for dissolution of marriage . . .
the court has continuing jurisdiction to award community estate assets or
community estate liabilities to the parties that have not been previously
adjudicated by a judgment in the proceeding. A party may file a
postjudgment motion or order to show cause in the proceeding in order to
obtain adjudication of any community estate asset or liability omitted or not
adjudicated by the judgment. In these cases, the court shall equally divide
the omitted or unadjudicated community estate asset or liability, unless the
27
court finds upon good cause shown that the interests of justice require an
unequal division of the asset or liability.”
A party’s delay in seeking postjudgment property adjudication does not
bar relief under section 2556. (In re Marriage of Huntley (2017) 10
Cal.App.5th 1053, 1060.) In addition, section 2556 applies “even when former
spouses were aware of the community property at the time the dissolution
judgment was entered.” (Ibid.) “The mere mention of an asset in the
judgment is not controlling. [Citation.] ‘[T]he crucial question is whether the
benefits were actually litigated and divided in the previous proceeding.’ ” (In
re Marriage of Thorne & Raccina (2012) 203 Cal.App.4th 492, 501 (Thorne &
Raccina).)
A party seeking relief under section 2556 bears the burden to show a
community asset was omitted from the judgment. (See Evid. Code, §§ 500
[“Except as otherwise provided by law, a party has the burden of proof as to
each fact the existence or nonexistence of which is essential to the claim for
relief or defense that he [or she] is asserting.”] & 550, subd. (b) [“The burden
of producing evidence as to a particular fact is initially on the party with the
burden of proof as to that fact.”].)
2. Analysis
As we have discussed, substantial evidence supports the trial court’s
finding the parties explicitly negotiated over the Kurmac note at the
mediation and came to a “meeting of the minds” over what Kim could expect
to receive from this asset, as set forth in Section 1(b) of the MSA. (See
Kieturakis, supra, 138 Cal.App.4th at p. 85 [“ ‘Voluntary participation and
self-determination are fundamental principles of mediation’ ” and divorce
mediators “ ‘generally work to balance the negotiating power between the
28
parties,’ ” producing “ ‘agreements that are more fair and voluntary, rather
than coerced.’ ”].)
Quite clearly, the Kurmac Note was not omitted from the Judgment, as
Kim posits, but instead was “actually litigated and divided” by the parties in
their overall division of the estate. (See Thorne & Raccina, supra, 203
Cal.App.4th at p. 501; accord, Henn v. Henn (1980) 26 Cal.3d 323, 330 [noting
that a spouse’s entitlement to a share of community property cannot be
“altered except by judicial decree or an agreement between the parties” (italics
added)].)
Kim in essence asked the trial court, and now is asking this court, to
rewrite the MSA on terms more favorable to her. However, section 2556
neither authorizes modification of a judgment for property division nor a
court to act on community assets (or debts) that were clearly contemplated by
a parties’ marital settlement agreement. (See Kieturakis, supra, 138
Cal.App.4th at p. 86 [noting that when parties opt to participate in mediation
and understandably seek to “pursue their best interests and strive for an
advantageous bargain,” “if . . . any such favorable bargain could . . . be set
aside at the option of the disappointed party, the effectiveness of mediation
as a method of settling marital property disputes would be greatly impaired,”
thereby jeopardizing mediated settlements “because relatively few of them,
upon close scrutiny, would likely be found to have been perfectly equal”];
accord, In re Marriage of Simundza (2004) 121 Cal.App.4th 1513, 1515
[affirming trial court order denying wife’s motion to further divide former
husband’s pension benefit under section 2556 because the parties expressly
agreed when entering into a stipulated marital dissolution judgment that
wife would receive the “flat amount” of $200 per month for 12 years following
husband’s retirement, and thus the pension benefit was not a partially
29
omitted asset].) We thus reject Kim’s alternate argument that the trial court
erred when it found the Kurmac note was not omitted from the Judgment.
C. Riverock
Kim next contends the trial court erred in finding Riverock was not
omitted from the Judgment. In support, Kim relies on sections 721,
subdivision (b) and 1100.
Section 721, subdivision (b)20 imposes a fiduciary duty upon
transactions involving spouses, including a spouse’s management and control
of community assets as set forth in section 1100, subdivision (e).21
Consistent with these sections, subdivision (b) of section 110022 prohibits a
spouse from making a transfer or gift of community property without the
written consent of the other spouse. Courts have applied these laws to
protect one spouse from unauthorized community property dispositions by
the other spouse. (See e.g., Droeger v. Friedman, Sloan & Ross (1991)
20 Subdivision (b) of section 721 provides in part: “[I]n transactions
between themselves, spouses are subject to the general rules governing
fiduciary relationships that control the actions of persons occupying
confidential relations with each other. This confidential relationship imposes
a duty of the highest good faith and fair dealing on each spouse, and neither
shall take any unfair advantage of the other.” (§ 721, subd. (b).)
21 Subdivision (e) of section 1100 provides in part: “Each spouse shall act
with respect to the other spouse in the management and control of the
community assets and liabilities in accordance with the general rules
governing fiduciary relationships which control the actions of persons having
relationships of personal confidence as specified in Section 721 . . . .” (§ 1100,
subd. (e).)
22 Subdivision (b) of section 1100 provides in part: “A spouse may not
make a gift of community personal property, or dispose of community
personal property for less than fair and reasonable value, without the written
consent of the other spouse.” (§ 1100, subd. (b).)
30
54 Cal.3d 26, 30 [nonconsenting husband was entitled to invalidate in its
entirety an encumbrance on two parcels of community real property
unilaterally made postseparation by wife].)
The trial court found Riverock was not a community asset, belonging to
Mack’s daughter “at all relevant times” after he had made a gift of money to
her; that Kim, in any event, never raised consent, or lack thereof, as an issue
or the related issue of whether Mack lacked the “power” to make this gift;
and that it also would “be unable to make such . . . finding[s] based on the
evidence presented at trial.”
On appeal, Kim argues she timely objected to Mack’s gifting of money
to his daughter in her objections to the proposed statement of decision. Kim’s
argument, however, presupposes that Mack gifted away community funds.
But Kim has failed to direct this court to any evidence in this voluminous
record to support the finding that either Riverock, or the funds Mack
transferred to his daughter to start the company, was a community asset
subject to post-Judgment division under section 2556. (See Belli v. Curtis
Pub. Co. (1972) 25 Cal.App.3d 384, 394, fn. 5 [a court of appeal is under no
“duty” to “search the record for evidence which will serve to overturn the
judgment [or order]”.) Absent this showing, Kim cannot satisfy her burden to
establish Riverock was an omitted asset. (See § 2556 [limiting the statute’s
application to community assets and liabilities]; Evid. Code, §§ 500, 550,
subd. (b).])
Moreover, even assuming Mack used community assets to fund
Riverock, we disagree she raised her alleged lack of consent to the transfer as
an issue in the trial court. In her objections to the proposed SOD, Kim
merely argued there “was no evidence proffered at trial that the funds [for
Riverock] were a gift.” But as summarized ante, that is not a correct
31
statement of the record. At trial, Mack testified he gifted his daughter Bari
$200,000 to invest in real estate; that the money was for Bari to use as she
saw fit; and that he had no interest in the company. Mack also made similar
statements to Brinig before the mediation, who therefore considered Riverock
“off the table.”
Despite this evidence, Kim did not argue below that Mack lacked
authority under section 1100, subdivision (b) to make the gift to his daughter,
or that Kim ever objected to this gift, both of which are inherently factual
questions that should have been decided by the trier of fact. For this
separate reason, we conclude the trial court did not err in finding Riverock
was not subject to section 2556. (See Zimmerman, Rosenfeld, Gersh & Leeds
LLP v. Larson (2005) 131 Cal.App.4th 1466, 1488 [“appellate court can deem
an argument raised in an appeal . . . waived if it was not raised below and
requires consideration of new factual questions”]; City of Merced v. American
Motorists Inc. Co. (2005) 126 Cal.App.4th 1316, 1327 [“[s]ince this new theory
involves an issue of fact . . . and the facts to support the theory were not
developed below, we find the argument was waived for failure to raise it in
the trial court”].)
D. Laurel
Kim also contends the $380,000 Kurmac promissory note held by
Laurel was omitted from the Judgment.
Not unlike the situation involving Mack’s gift of money to Bari, Kim in
her opening brief does not explain why Laurel should be treated as a
community asset. Although Kim asserts Mack “put money into Laurel,” she
provides no evidence when he did so, despite Laurel being in existence for
more than 20 years, or whether that money was separate or community
property (or a combination thereof). As such, we conclude Kim has failed to
32
meet her burden of proof demonstrating that Laurel was part of the
community estate. (See § 2556; Evid. Code, §§ 500, 550.) We are not
required to comb the record for confirmation of a critical fact Kim is asking us
to assume without pointing to any supporting evidence.
In addition, even if Laurel were deemed a community asset, we would
still conclude the trial court did not err in refusing to divide it under section
2556. Substantial evidence supports the court’s finding that the $380,000
note—“or anything else related to Laurel”—did not affect the total amount of
“community assets less debts available for distribution.” (Italics added.) It is
undisputed that Laurel’s only asset was the $380,000 debt owed to it by
Kurmac. Because Kurmac was itself a community asset, Laurel’s $380,000
asset—if treated as community property—would have been offset by
Kurmac’s $380,000 debt. Mack received Kurmac as his separate property
under the Judgment, which included Kurmac’s $380,000 liability for its debt
to Laurel—later paid off by Kurmac. Thus, the value of Mack’s agreed share
of the community property was reduced by the amount of the $380,000 note
to Laurel. Kim cites nothing in the record to establish that these offsetting
figures were not taken into account by the parties in valuing and splitting up
the community property and awarding Kim payments of $15,000 per month
totaling $3 million. For the same reason, even assuming any error, Kim has
failed to demonstrate it is reasonably probable that a result more favorable to
her would have been reached had this asset been subject to division under
section 2556. (See Cassim v. Allstate Ins. Co. (2004) 33 Cal.4th 780, 800
[harmless error standard under People v. Watson (1956) 46 Cal.2d 818, 836,
applies to civil cases].)
33
III. DISPOSITION
The trial court’s August 22, 2022 order denying Kim’s Motion to set
aside the Judgment, or alternatively, to enforce the Judgment and divide
assets, is affirmed. In the interests of justice, the parties are to bear their
own costs on appeal. (See Cal. Rules of Court, rule 8.278(a)(5).)
BUCHANAN, J.
WE CONCUR:
O'ROURKE, Acting P. J.
IRION, J.
34