Cora v. Cora CA2/6

Filed 12/14/21 Cora v. Cora CA2/6
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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has not been certified for publication or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SIX
JENNIFER CORA, 2d Civ. No. B308834
(Super. Ct. No. 15FL02036)
Plaintiff and Respondent, (Santa Barbara County)
v.
CATHERINE CORA,
Defendant and Appellant.
This is an appeal from an order appointing a receiver to
collect child and spousal support and attorney fees. We affirm.
FACTS
Catherine Cora is a celebrity chef with an interest in a
number of businesses. She was married to Jennifer Cora until
their marriage was dissolved in February 2017. They have four
children of the marriage, all of whom were minors at the time of
the dissolution. While Catherine worked outside of the home,
Jennifer stayed home with the children.
At the time of the dissolution, Catherine had a monthly
gross income of $52,305. Jennifer has serious physical and
emotional limitations and had been out of the workforce for a
long time. The trial court declined to impute income to her.
The trial court ordered Catherine to pay $8,118 monthly
child support and $9,500 monthly spousal support. The court
also ordered Catherine to pay Jennifer’s attorney $440,000.
Jennifer’s First Motion for Appointment of Receiver
In May 2017, Jennifer made a motion for the appointment
of a receiver. She stated that the trial court’s order to pay
$440,000 in attorney fees remains wholly unsatisfied, and that
Catherine’s diverse financial interests make the appointment of a
receiver a reasonable remedy.
The trial court made a tentative ruling granting the
motion. But at Catherine’s request, the court continued the
matter to give her time to make the payment. Catherine made
the payment and no receiver was appointed.
Catherine’s Motion to Modify Support
In March 2020, Catherine made a motion to modify both
child and spousal support. She claimed financial losses in the
restaurant business due to the COVID pandemic made it
impossible for her to meet her support obligations.
Catherine refused to provide the documents Jennifer’s
accountant needed to make an analysis of Catherine’s finances.
The trial court denied the motion, finding that Catherine failed to
carry her burden of proof.
Instant Motion to Appoint a Receiver
In August 2020, Jennifer made the instant motion to
appoint a receiver to collect delinquent support payments and
attorney fees. Jennifer declared that as of April 1, 2020,
Catherine had unilaterally reduced her $8,118 monthly payment
for child support to $4,000 per month and stopped paying $9,500
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in spousal support. The delinquent payments are $20,590 in
child support, $47,500 in spousal support, and $50,000 in
attorney fees.
Jennifer declared that Catherine has substantial assets she
is not disclosing to the court. She listed 36 separate sources of
income. Jennifer declared that due to Catherine’s experience in
obfuscating income and assets, it will not be enough to try to levy
her bank accounts. The appointment of a receiver is necessary.
Catherine’s Response
In opposition to the motion, Catherine declared that due to
the COVID pandemic, her estate has collapsed. She claimed she
is earning only $1,800 per month in unemployment benefits and
nominal income from a recent inheritance.
Catherine declared that she has provided all her financial
information with documents to Jennifer and her accountant.
Catherine requested that she not be required to open her
businesses to a receiver. She stated she currently employs a
financial advisor and a CPA. She claimed she is on the brink of
bankruptcy.
Jennifer’s Reply
Jennifer replied that Catherine continues to live lavishly in
two homes: one in Santa Barbara and the other in Beverly Hills.
Catherine continues to hide assets and pay high-price divorce
lawyers and an accountant instead of paying support. Jennifer
declared that other collection efforts, including a bank levy and
contempt proceedings, had not been successful.
Ruling
In ordering the appointment of a receiver, the trial court
found: Catherine’s income and expense declaration does not “fill
in the blanks” required to show her earnings and assets. Much of
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the litigation has been about Catherine not paying the support
ordered. If Catherine had her way, her support obligations would
be held hostage to her business challenges, her business
opportunities, and her threat of filing for bankruptcy. The court’s
support orders would be treated as any other business obligation.
Catherine’s assertion that Jennifer has not tried other methods of
collection is incorrect.
DISCUSSION
I
Appointment of Receiver is Appropriate
Catherine contends the trial court erred in appointing a
receiver.
Family Code section 290 provides, in part, “A judgment or
order made or entered pursuant to this code may be enforced by
the court by . . . the appointment of a receiver . . . .” We review
the order appointing a receiver for an abuse of discretion. (City
and County of San Francisco v. Daley (1993) 16 Cal.App.4th 734,
744.)
Catherine relies on Medipro Medical Staffing LLC v.
Certified Nursing Registry, Inc. (2021) 60 Cal.App.5th 622(Medipro). There the trial court appointed a receiver pursuant to
the Enforcement of Judgments Law (Code Civ. Proc., § 680.010 et
seq.1) to enforce an ordinary civil judgment. The court held that
the trial court abuses its discretion “if it appoints a receiver to aid
in the collection of a money judgment where the record contains
no evidence that the judgment debtors had obfuscated or
frustrated the creditor’s collection efforts and no evidence that
1All statutory references are to the Code of Civil Procedure
unless otherwise stated.
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less intrusive collection methods were inadequate or ineffective.”
(Medipro, at pp. 624-625.)
Medipro is distinguishable. First, we are not concerned
here with an ordinary money judgment. We are concerned with
an order for spousal and child support. Support orders have a
special place in the law. As our Supreme Court stated in Bruton
v. Tearle (1936) 7 Cal.2d 48, 58: “If permanent alimony be
regarded as a part of the husband's estate and as a portion of his
current income and earnings, then the wife under her alimony
judgment has an interest in the husband's earnings both those
which have accrued and those which will fall due in the future.
In such a case there can be no legal objection to an order of court
appointing a receiver for the purpose of securing to the wife her
interest in those earnings. To deny her that right would permit
the husband, as he has done in the present case, to receive his
salary or other income in full and make away with it before the
wife by any legal process could claim any portion of it. By the
proceeding resorted to in the instant case the court simply
intercepts the husband's income before it reaches him and
devotes it to the purposes to which the law has subjected it.
Unless the court has the power to make and execute such an
order, the interest of the wife in her husband's estate would be in
many instances, as it would be in the present case, absolutely lost
and defeated.”
Support orders are different than ordinary judgments.
People depend on support payments to survive. Jennifer is
unable to work and there are minor children. In denying
Catherine’s motion to reduce support payments, the trial court
found that granting Catherine’s request would render Jennifer
homeless and cause their four children “extraordinary hardship
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and grief.” Catherine points to no similar findings in Medipro.
The trial court must be given much greater latitude in imposing a
receivership to enforce support orders than in the case of an
ordinary judgment.
Second, here there was evidence that Catherine obfuscated
or frustrated Jennifer’s collection efforts. In the contempt
proceeding, the trial court found that Catherine refused to
provide the documents that Jennifer’s accountant needed. In the
instant matter, the trial court found that Catherine’s income and
expense declaration does not “fill in the blanks” required to show
her earnings and assets. Catherine was doing everything she
could not to make a full disclosure.
Third, Jennifer attempted less intrusive collection methods.
She made a motion to hold Catherine in contempt and
unsuccessfully tried a bank levy. Whether this would be
sufficient to satisfy Medipro is beside the point. Jennifer and the
children need support. They cannot afford to wait while Jennifer
tries various collection measures against a party who is willing
and able to frustrate those attempts. The only collection measure
that has proved successful was the trial court’s first order
appointing a receiver.
Given all the circumstances of this case, the trial court did
not abuse its discretion in appointing a receiver.
II
Scope of Receivership
Catherine contends the scope of the receivership exceeds
what is allowable by law.
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(a) Exemption
Catherine argues the trial court failed to identify which
earnings are exempt from execution for her own living expenses
and for the support of her children.
Catherine relies on sections 706.051, subdivision (b) and
706.052, subdivision (a). Section 706.051, subdivision (b)
provides, in part: “[T]he portion of the judgment debtor’s
earnings that the judgment debtor proves is necessary for the
support of the judgment debtor or the judgment debtor’s family
supported in whole or in part by the judgment debtor is exempt
from levy under this chapter.” Section 706.052, subdivision (a)
provides, in part: “[O]ne-half of the disposable earnings . . . of the
judgment debtor, plus any amount withheld from the judgment
debtor’s earnings pursuant to any earnings assignment order for
support, is exempt from levy under this chapter where the
earnings withholding order is a withholding order for support
under Section 706.030.”
Those sections are part of the Wage Garnishment Law.
(§ 706.010 et seq.) The sections apply only to wages garnished
from an employee. (Moses v. DeVersecy (1984) 157 Cal.App.3d
1071, 1073-1074.) They do not apply to self-employed persons.
(Ibid.) Persons who own a controlling interest in a corporation or
other business entity are for all intents and purposes self-
employed. Here Catherine is largely self-employed. But even if
the sections apply, Catherine cites no authority requiring them to
be included in the order appointing a receiver.
Catherine relies on Olsan v. Comora (1977) 73 Cal.App.3d
642. In Olsan, the trial court appointed a receiver to collect an
ordinary money judgment from a dentist. The Court of Appeal
affirmed the order appointing the receiver. The judgment debtor
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argued that the order was too hard in that it allowed the receiver
to take possession of all his earnings when some were exempt
under former section 690 et seq. The Court of Appeal rejected the
argument by pointing out that the order specifically states the
receiver is authorized to release to the judgment debtor so much
of his earnings as would be exempt under those sections. (Olsan,
at p. 649.)
In Olsan, the court did not say that every order appointing
a receiver must expressly reference all possible exemptions. The
court simply answered the judgment debtor’s argument by
pointing out that the order satisfied his particular objection.
(Olsan v. Comora, supra, 73 Cal.App.3d at p. 649.) More to the
point, Olsan does not say the court must identify in its order
which earnings are exempt from execution.
Implied in the order appointing a receiver is that the
receiver is bound to follow the law. If the law exempts certain
earnings from the reach of the receiver, then the receiver may not
take them. Catherine cites no authority requiring the order
appointing a receiver to specify which laws apply.
(b) Other Entities
Catherine argues the order improperly applies to business
entities that were not joined or in which she has no interest.
The order appointing the receiver listed a number of
business entities. Catherine claims she has no interest in some
of those entities. She cites Stuparich Mfg. Co. v. Superior Court
(1899) 123 Cal. 290, 292, for the proposition that a receiver may
not take possession or order the surrender of property from a
nonparty business entity who was not a party to the underlying
action.
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Catherine points to no place in the record where this issue
was raised. Jennifer points out that Catherine is raising it for
the first time on appeal. Issues raised for the first time on appeal
are waived. (In re S.C. (2006) 138 Cal.App.4th 396, 406.)
(c) Cost of Receivership
Catherine argues the trial court failed to take into account
the cost and impact of a receivership on her businesses.
The receivership was necessary because Catherine refused
to be candid with the court about her business interests and
income. She will not now be heard to complain about the cost
and impact to her businesses.
(d) Privileged Communications
Catherine argues the order is overly broad in that it
requires her to turn over all correspondence to the receiver.
Catherine points out that some correspondence is covered
by privilege, such as the attorney-client privilege (Evid. Code,
§ 954) and the marital privilege (id., § 980).
If Catherine has any correspondence she deems privileged,
she can apply to the trial court to appoint a referee to resolve the
matter. Catherine cites no authority that the order violates her
right to privacy.
DISPOSITION
The judgment (order) is affirmed. Costs on appeal are
awarded to respondent.
NOT TO BE PUBLISHED.
GILBERT, P. J.
We concur:
YEGAN, J. PERREN, J.
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Thomas P. Anderle, Judge
Superior Court County of Santa Barbara
______________________________
Law Offices of Donald L. Briggs, Amy Shiffman Hendel,
and Donald L. Briggs for Defendant and Appellant.
Law Office of Stephanie J. Finelli, Stephanie J. Finelli;
Drury Pullen, Susanna V. Pullen for Plaintiff and Respondent.
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