Articles Posted in California Courts of Appeal

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In May 1995, Charlene’s parents created CJPM Family Partnership, Ltd. Charlene’s parents are the general partners. Charlene, her parents, and her siblings are limited partners of CJPM. Philip and Charlene married in June 1995. CJPM made three loans to Philip totaling $150,000, which were credited against Charlene’s partnership interest. Philip did not repay the debt. The two divorced in 2011. Their stipulated dissolution judgment awarded Charlene all interest to any community interest in CJPM, assigned to Philip, as his separate obligation, his debt to CJPM, and required Philip to indemnify Charlene from that debt. Philip filed for Chapter 7 bankruptcy. All of his debts, including his CJPM loan, were discharged. Years later, Charlene unsuccessfully moved to reopen bankruptcy proceedings to obtain a ruling that Philip’s debt to CJPM was nondischargeable. Charlene then moved to recover Philip’s CJPM debt in state court. The trial court determined that Philip’s CJPM debt was nondischargeable under the 11 U.S.C. 523(a)(15) exemption and calculated that Philip owes Charlene $345,963. The court of appeal affirmed. When the nature of a debt is such that its discharge will directly and adversely impact the finances of the debtor’s spouse or former spouse, it is nondischargeable in bankruptcy, even if it is not directly payable to the spouse. View "Marriage of Vaughn" on Justia Law

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Defendant Anice Plikaytis appealed an order awarding her attorneys' fees in a breach of contract action brought by plaintiff Debra Roth. In the published portion of its opinion, the Court of Appeal agreed with Plikaytis's contention that the trial court erred when it declined to consider previously filed documents she incorporated by reference as part of her motion. In the unpublished portions of the opinion, the Court discussed Plikaytis's arguments that: (1) the court failed to apply the lodestar method; (2) erroneously denied fees for equitable and cross-claims and for obtaining relief from bankruptcy stays; and (3) substantially reduced her award without explanation. The Court of Appeal concluded the trial court erred by denying fees for obtaining bankruptcy stay relief that related to the breach claim and failing to provide an adequate justification for significantly reducing the number of hours allowed. Accordingly, the trial court was affirmed in part, reversed in part, and the matter remanded with directions. View "Roth v. Plikaytis" on Justia Law