Hanna – Trust

Mark objected to the petition (ROA 10), claiming he owned the stamp collection and denying he had ever agreed Patricia could purchase his interest in the Property or, alternatively, if he had so agreed, Patricia undervalued the Property. The objection also raised issues regarding allegedly unnecessary loans, unsubstantiated trustee and attorney fees, and other unsubstantiated expenditures.

The matter proceeded to trial before Judge David L. Belz, who bifurcated the matter and tried the following two issues as Phase 1: (1) “the issues relating to buyout of the Property” (ROA 204 at 16:10-13) and (2) whether the stamp collection was an asset of the Trust.” (ROA 204 at 2:24-3:2.)

On July 1, 2022, Judge Belz issued the Judgment, which determined: (1) the stamp collection was not a Trust asset but Patricia was justified in spending Trust assets to seek instructions regarding its ownership (ROA 204 at 15:21-16:3) and (2) Mark agreed to allow Patricia to purchase the Property from the trust at an appraised value of $594,000 and Patricia purchased the Property for that amount (ROA 204 at 14:6-13). The court authorized and instructed Patricia to “distribute [Mark’s] one-half interest in the [Property] to [Patricia] at the agreed net value of $594,000” (ROA 204 at 16:24-27).

Mark appealed the Judgment (ROA 216). In his appeal, Mark made three arguments: (1) the court applied the wrong legal standard of care in finding Patricia’s efforts to determine the value of the Property were fair and reasonable; (2) the court failed to adhere to the established bifurcation plan by cutting off Mark’s due process right to have all his valuation evidence considered; and (3) the trial court improperly applied the doctrine of equitable estoppel by considering Mark’s silence as consent to the dealings regarding the Property. (ROA 250 at p 7). The appellate court rejected all three arguments and affirmed. (ROA 250.) The matter was remitted on February 20, 2024. (ROA 251.)

On June 16, 2025—a year and four months after the matter was remitted from his unsuccessful appeal, Mark filed the instant motion seeking to set aside the Judgment.

Motion. Phase 1 was tried by Judge Belz. While the matter was on appeal, Judge Belz retired. Accordingly, when Phase 2 was set for trial, the matter was assigned to another judge. The motion currently before the court seeks to vacate the Judgment on the ground that trial of the second phase by any judge other than Judge Belz would be a denial of Mark’s due process. In support of his argument, Mark cites European Beverage, Inc. v. Superior Court (1996) 43 Cal.App.4th 1211, 1214 which held: “Where there has been an interlocutory judgment rendered by one judge, and that judge then becomes unavailable to decide the remainder of the case, a successor judge is obliged to hear the evidence and make his or her own decision on all issues, including those that had been tried before the first judge, unless the parties stipulate otherwise.

This is because an interlocutory judgment is subject to modification at any time prior to entry of a final judgment. It is considered a denial of due process for a new judge to render a final judgment without having heard all of the evidence.” (Internal citations omitted.) Where, however, the first judgment in a bifurcated case is not interlocutory and the second phase does not involve the same evidence or issues of credibility, it is not a denial of due process to have it heard by a different judge. (Blumenthal v.

Superior Court (2006) 137 Cal.App.4th, 672, 681–682; Valentine v. Baxter Healthcare Corp. (1999) 68 Cal.App.4th 1467, 1479– 1480.) This leaves two questions the court must answer in connection with this motion: (1) is the Judgment interlocutory and (2) does the second phase involve the same evidence or issues of credibility.

Is the Judgment interlocutory? “A judgment is the final determination of the rights of the parties in an action or proceeding.” (Code Civ. Proc., § 577) “‘A judgment is final “‘“‘when it terminates the litigation between the parties on the merits of the case and leaves nothing to be done but to enforce by execution what has been determined.’”’” [Citation.] “‘“It is not the form of the decree but the substance and effect of the adjudication which is determinative. As a general test, which must be adapted to the particular circumstances of the individual case, it may be said that where no issue is left for future consideration except the fact of compliance or noncompliance with the terms of the first decree, that decree is final, but where anything further in the nature of judicial action on the part of the court is essential to a final determination of the rights of the parties, the decree is interlocutory.”’” (Dhillon v.

John Muir Health (2017) 2 Cal.5th 1109, 1115.) “[A]n interlocutory judgment is subject to modification at any time prior to entry of a final judgment.” (European Beverage, Inc. v. Superior Court (1996) 43 Cal.App.4th 1211, 1214.)

In his motion, Mr. Hanna argues the Judgment is interlocutory, not final. In supplemental briefing on this motion, however, Mr. Hanna acknowledges the Judgment “resolved” two issues, which he identifies as follows: (1) “Mark is estopped from

denying the existence of the (alleged) agreement by which Patricia may purchase the Residence; and (2) that the stamp collection was owned by Mark and was not a trust asset.” (ROA 361 at 4:15-18.) Mr. Hanna’s description of the first issue resolved in the Judgment, however, is too narrow. The judgment did not only determine that Mr. Hanna was estopped from denying the existence of the agreement, it enforced the agreement valuing the Property at $594,000: “The court finds in favor of Petitioner, Patricia Watis, and authorizes and instructs her to distribute Mark Hannah’s [sic] one-half interest in the [Property], located at 1163 N.

Sacramento, Orange, CA 92867, to Patricia Waits at the agreed net value of $594,000 using the agreed net value of $594,000 [sic].” (ROA 204 at 16:24-27). The Judgment finally determined the sale of the Property to Patricia at a price of $594,000 and ownership of the stamp collection. As to those two issues, nothing “is left for future consideration except the fact of compliance or noncompliance with the terms” of the Judgment. (Dhillon v. John Muir Health, supra, 2 Cal.5th at 1115.)

Further, as an appeal may not be taken from an interlocutory judgment (Code of Civ. Proc., § 904.1(a)(1), Mr. Hanna’s current position is in direct opposition to his decision to appeal the Judgment. Because he chose to appeal, Mr. Hanna is judicially estopped from arguing that the Judgment he appealed was interlocutory. “‘“‘Judicial estoppel precludes a party from gaining an advantage by taking one position, and then seeking a second advantage by taking an incompatible position. [Citations.] The doctrine’s dual goals are to maintain the integrity of the judicial system and to protect parties from opponents’ unfair strategies. [Citation.]

Application of the doctrine is discretionary.’” [Citation.] The doctrine applies when “(1) the same party has taken two positions; (2) the positions were taken in judicial or quasi-judicial administrative proceedings; (3) the party was successful in asserting the first position (i.e., the tribunal adopted the position or accepted it as true); (4) the two positions are totally inconsistent; and (5) the first position was not taken as a result of ignorance, fraud, or mistake.”’” (People v. Castillo (2010) 49 Cal.4th 145, 155, italics omitted.)

All the required elements are met here. Mark presented the Judgment as final by his appeal, the presentation was accepted by the appellate court, he now claims the judgment was interlocutory—totally inconsistent to the presentation of the Judgment as final, and Mr. Hanna’s appeal was not the result of ignorance, fraud, or mistake. Mr. Hanna is judicially estopped from this second attack on the Judgment.

Will Phase 2 involve the same evidence and issues of credibility? Even if the judgment had been interlocutory, Mr. Hanna cannot meet the second part of the due process test, i.e. overlapping evidence and issues of credibility between Phases 1 and 2. In his supplemental briefing, Mr. Hanna admits “very little evidence for the second phase would be duplicative.” The

only exception he identifies is evidence regarding the value of the Property. For purposes of the Property sale and division of the Trust’s assets, that issue was determined by the Judgment, however. Phase 2 will not involve the same issues of evidence or credibility. Accordingly, it is not a denial of due process for a judge other than Judge Belz to hear and determine Phase 2.

Mark Hanna’s Motion for New Trial and to Strike Phase 1 Judgment (ROA 286) is DENIED.

Patricia Waits is directed to give notice.

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