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In Re the Marriage of Michael W. v. Blanca Montano

December 1, 2010

IN RE THE MARRIAGE OF MICHAEL W. LOSSE AND BLANCA MONTANO. MICHAEL W. LOSSE, PLAINTIFF AND RESPONDENT,
v.
BLANCA MONTANO, DEFENDANT AND RESPONDENT.



APPEAL from a judgment of the Superior Court of San Diego County, Joel Wohlfeil, Judge. Affirmed. (Super. Ct. No. D487761)

The opinion of the court was delivered by: McINTYRE, J.

Marriage of Losse and Montano

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NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

Michael W. Losse and Blanca Montano both appeal from the dissolution judgment that followed their February 2009 trial on reserved issues. In his appeal, Losse argues that the court erred in awarding Montano spousal support in the sum of $7,000 per month for 30 months, and attorneys fees totaling $75,000 minus credits. On cross-appeal, Montano contends the court erred in failing to award retroactive guideline child support from March 2006 forward, or impose monetary sanctions against Losse for his breach of fiduciary duty. In the event we reverse the prospective spousal support award, Montano asserts that the court should have awarded her retroactive spousal support and 100 percent of the value of Willow Cove Investment Group, Inc. (Willow Cove), Losse's business.

We affirm the judgment in its entirety. In light of this resolution, we need not address the last issue in Montano's cross-appeal.

FACTUAL AND PROCEDURAL BACKGROUND

Losse and Montano were married on September 11, 1999, and separated on December 21, 2004. Both were in their mid-forties. There are two children of the marriage, aged six and eight at the time of trial. The court entered the judgment of dissolution as to marital status on March 9, 2006, reserving jurisdiction over child support, spousal support, child custody and visitation, valuation of Losse's business interests, and division of personal property. This appeal concerns the judgment entered following trial on the reserved issues.

Montano is a registered nurse specializing in neo-natal care who worked four 12-hour shifts every two weeks. Montano testified that by working less than full time as a per diem nurse, she was able to choose her shifts and accommodate the children's schedule. She earned $42.28 per hour plus a $2.00 shift differential, for an average of $4,390 per month as of January 22, 2009.

Losse is a licensed stock broker and financial planner who worked between 45 and 60 hours a week. Losse and John McDonald owned L.M. Squared Investments, LLC (L.M. Squared), a "support entity" that was the sole owner of the brokerage firm Willow Cove. There was conflicting evidence on whether Losse owned the minority or majority interest in L.M. Squared. In any event, McDonald was a "silent partner," leaving Losse in complete control of the business. Losse declared that he received an average monthly income of $5,000 in 2006, zero in 2007, and zero in 2008. However, in his opening brief on appeal, Losse represents that he earned "approximately $6,000 per month in all recent years except 2006."

Montano had difficulty obtaining Losse's financial records. She repeatedly subpoenaed information about his income and assets. In January 2008, after denying Losse's petition to quash her subpoena of bank records, the court reminded the parties of their obligations as fiduciaries under Family Code sections 721, subdivision (b) and 1100, subdivision (e). (Undesignated statutory references are to the Family Code.)

At trial, Montano introduced a 2006 W-2 form which showed that Losse's annual income was $435,380, not the $35,380 which appeared on the W-2 form he had earlier produced. Montano also introduced documents showing that Losse opened an account with Scottrade in January 2006 with an initial deposit of $62,500. The Scottrade account had a total value of $227,680.46 on March 31, 2006. Losse did not disclose this account in the income and expense declaration he filed on February 17, 2006. At trial, Losse repeatedly asserted his Fifth Amendment right to remain silent when presented with evidence regarding his income and assets.

The court appointed John Cooper to provide a neutral valuation of the community business interests. In October 2006, Cooper conducted limited review of the records of L.M. Squared and Willow Cove to determine whether there was sufficient value to warrant complete appraisals of those businesses. Cooper concluded that the parties' interest in the combined businesses was worth $154,721 as of December 31, 2005. Cooper prepared a second draft report in October 2007 which was introduced at trial. There he concluded that the value of the parties' interest in the combined businesses was $144,800 on December 31, 2004. In preparing his draft reports, Cooper interviewed Montano and Losse, and reviewed the financial information Losse provided. However, Losse denied Cooper access to his business accountant and refused to comply with Cooper's numerous requests for additional financial documents. Cooper requested detailed general ledgers and was told they did not exist. At trial, Cooper testified he could not stand by the conclusions reached in the second draft report because he had reason to believe the information received from Losse was inaccurate. Losse testified at trial that his interest in Willow Cove had no value on December 31, 2004.

McDonald sued Losse for damages and dissolution of L.M. Squared and Willow Cove. In her opposition to Losse's June 2008 petition to quash subpoena of bank records, Montano sought judicial notice of documents from the McDonald litigation, including a motion for continuance that cited Losse's "discovery games." In August 2008, the court denied Losse's motion to quash Montano's subpoena of W-2 forms and other earnings records, and directed Losse not to object to subpoena of documents relating to the McDonald case. At trial, Montano introduced evidence ...


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