In a dissolution proceeding, Janice Kochan sought to increase the spousal support she received from Roman Kochan. Roman had been employed by California State University at Long Beach for forty years. He was eligible for retirement, as well as for postretirement part-time employment at the university. He enjoyed his work and did not want to retire. After a bench trial, the Superior Court in Los Angeles County found that Ro- man’s potential income under the retirement and post- retirement employment scenario would be greater than his current employment income. The court granted Janice’s request for an increase in spousal support. The court based its support calculation in part on Roman’s earning capacity upon retirement and postretirement employment. Although a court must consider earning capacity under Family Code section 4320, it exercises discretion in deciding whether support should be based on earning capacity or actual earning.
Family Code section 4320 provides that the fam- ily law court “shall consider” the “earning capacity of each party” in ordering spousal support, but the decision whether to order support based on a party’s earning capacity rather than actual earning is a mat- ter within the court’s discretion. Id. at 422 (emphasis added).
The Court of Appeal reversed. It held that potential re- tirement income of a current and long-term employee is not a proper basis for calculating spousal support. The court explained that just as a court should not enter an order that would compel a spouse to forgo retirement, it also should not enter an order that would compel a spouse to retire. The court further held that a court abuses its discretion “when it bases an order for spousal support on a finding that a spouse’s pres- ent earning from long-term employment can be in- creased by taking a retirement, and returning to work in an available, but different, position.” Id. at 429. The court concluded that “a spouse who continues working in a long-held position should not have his or her sup- port obligation based on his or her earnings capacity measured by some alternative employment scenario.” Id. at 430. The court found that to conclude otherwise would lead to problems in other situations, including those involving judges:
For example, in the event a long-seated judicial officer were to divorce, may the family law court consider the likelihood that he or she would earn significantly greater income in private practice or by becoming a private judge? Id. (emphasis added).
GUIDANCE BUT NOT FINALITY
For a couple in contentious litigation over alimony, these recent Courts of Appeal cases provide guidance. For a spouse on the winning side of these cases, they even provide legal support. In California, because of vertical stare decisis, the decisions in the cases are bind- ing on all state trial courts, irrespective of their county or appellate district. However, for a spouse on the los- ing side of these cases, there is still a chance of pre- vailing on appeal. Because there is no horizontal stare decisis within the Courts of Appeal, the decisions in the cases are not binding on other appellate districts or even other divisions within the districts in which the cases were decided. In other words, the Courts of Appeal are generally free to decide differently on future cases. Thus, while these cases provide guidance on the impact of prenups, military allowance, marriage regis- tration, and potential retirement on alimony, they do not end litigation over these issues.
Notes 1. See U.S. Census Bureau,
www.census.gov/compen- dia/statab/2011/tables/11s1335.pdf (as of July 22, 2011).
2. See Wikipedia, The Free Encyclopedia,
http://en.wikipedia.org/wiki/Divorce#United_States (as of July 22, 2011) (additional citations therein).
3. On March 10, 2011, a petition for a writ of certiorari was filed in the United States Supreme Court. The peti- tion was still pending review as of July 22, 2011, when this article was submitted for publication.
Audra Ibarra is an appellate attorney. She also serves as a commissioner for the Judicial Nominees Evaluation Com- mission for the California State Bar and a judge pro tem- pore for California Superior Court in Santa Clara County.
THE BAR ASSOCIATION OF SAN FRANCISCO SAN FRANCISCO ATTORNEY 45
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