Marriage Of Varner

Facts

H and W started living together when W was 15 years old and H, who had previously been married and divorced, was 24. The parties married in 1977 when W was 17, and their first child was born in 1978. In 1984 they separated, and W filed a petition for dissolution. They had three children. The matter was repeatedly continued and was finally taken off calendar in October 1985 when the parties reconciled. In September of 1989, they separated; two more children had been born. W was unemployed. W's counsel withdrew, but by January 1990, W had new counsel. In February 1992 W filed a 30-day notice asking the court to value numerous business assets as of September 30, 1989, or April 30, 1990, rather than at the time of trial. W filed a petition that included a list of 32 items of community property assets among which were five parcels of real property, seven investment or bank accounts, four businesses, three partnerships, a business center, a note receivable, a life insurance policy, five vehicles, three boats, assets in a Varner Family Trust, and other property unknown to W. In May of 1993 counsel for W withdrew. On July 13, 1993, the court denied her request for continuance and proceeded with the hearing. H was represented by counsel. H claimed the businesses were valueless. H testified that his monthly income was about $8,000. He stated that his business was not good the way it had been. W wanted the parties' house in Riverside, which was about 5,000 square feet in size, on 21/2 acres. W's attorney had the house appraised at $500,000 or $550,000, but that he thought it was worth between $600,000 and $700,000, and that it had a debt on it of $160,000. H claimed $650,000 was a fair value for the house, resulting in a net value to wife of $490,000 for the house. H testified to the value of four parcels of real property owned by the parties, properties that were to be awarded to him. H owned all the stock in a business called Varner Construction, Inc., and that he was a 60 percent partner in Pipeline Specialties, Inc. H owned Varner Construction, Inc., prior to his marriage, and that the net value of the business was about zero. He stated that Pipeline Specialties, Inc., had a negative value of about $300,000. He valued Varner/Clendenen at about $40,000 to $ 50,000, and Group Equity Fund VI had a value of $7,000. Husband testified that the totality of the various business entities in which he had an interest equaled about zero. H claimed the total value of the assets to be allocated to W was $ 544,830. H would receive assets of a value of $281,000. H stated that under the agreement W would owe husband an equalization payment of roughly $150,000, H had offered to let W keep everything she had and had also agreed to pay off the $ 160,000 that was owed on the house. The judge told W that this was a very good disposition if the figures stated were correct. The hearing was continued for one week. The parties settled on July 20, 1993. H was ordered to pay W $6,000 per month as unallocated family support. The judgment divided the community property of the parties, although no values were attached to the items of property in the judgment. W was awarded nine items of property; H was awarded twenty-one items of property, including all the real property and assets related to the businesses of the parties. H agreed to pay the $160,000 obligation on the house awarded to W. On December 10, 1993, W obtained a new attorney. W filed a motion to set aside the stipulation for judgment and the judgment on three grounds: first, Code of Civil Procedure section 473; second, the inherent equitable power of the court to set aside judgments obtained through fraud, duress and overreaching; and, finally, Family Code sections 2120, 2121 and 2122 'which effectively extinguish the distinction between extrinsic and intrinsic fraud, in dissolution proceedings, and greatly expand fraud to include non-disclosure, misconduct and perjury, as well as mental incapacity of the disadvantaged spouse. W submitted evidence she had an intelligence quotient of 75. Wife submitted an appraisal of two business properties awarded to H with a combined value of $1,060,000. A preliminary appraisal of Varner Construction, Inc., was in the range of $2,000,000.00 to 2,750,000.00' rather than zero. The true value of Pipeline Specialties, Inc., was in the range of $300,000 to $600,000. An affidavit by W's neighbor stated that W was in tears after the hearing and though H was lying, but even the judge had told her to take the deal being offered. The neighbor stated she helped W get the appraiser and the present lawyer. W also claimed that the accountant who had been hired to appraise the community property in 1990 had difficulty in obtaining the documents necessary to complete her analysis, and she attached a declaration from October 1991 in which she had outlined those difficulties. The court denied the motion to set aside the judgment. A hearing was held in November 1994 to modify the custody and support provisions of the stipulated judgment. The court ordered that W was to receive $930 per month in child support and $870 per month as spousal support. W appealed. 

Issues

Rule of Law

Holding and Decision

Legal Analysis

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