Lawatch v. Lawatch

BURKE, P. J. After long and bitter litigation, an interlocutory judgment of divorce was entered granting a divorce decree to both the husband and wife, determining all property to be community and dividing it between the parties. Plaintiff husband appealed and the judgment was affirmed. (Lawatch v. Lawatch, 161 Cal.App.2d 780 [327 P.2d 603].) Final judgment was subsequently entered.

In order to equalize the property values between the parties, the business and business real estate being awarded the husband, a lien of $33,335.47 was granted wife and pursuant to agreement in open court provisions were agreed upon for the lien to be paid by the husband in installments. The following statement was included in the interlocutory decree following the division of the property and the imposition of the lien: “The lien given by this judgment in favor of the defendant [wife] shall be subrogated to a lien securing the repayment of any money that the plaintiff may elect to borrow from time to time, for reasonable business purposes (not personal), and the plaintiff shall give the defendant fifteen (15) days’ written notice of intention to borrow, stating the amount to be borrowed, and within said 15 days defendant may file a notice of motion in this court seeking an order denying subrogation of the sum proposed to be borrowed or such part thereof as defendant deems excessive, and on hearing the motion the burden shall be on defendant to establish that the sum or the part thereof objected to is not reasonably necessary for the purposes of the business. ’ ’

The final judgment of divorce carried over into effect all of the provisions of the interlocutory judgment pertaining to these matters. Some three years after the judgment became final plaintiff gave notice of intention to borrow money and defendant wife- noticed a motion in the superior court for an order denying subrogation of the lien in her favor to any loan proposed to be made by plaintiff. Plaintiff had proposed to borrow the sum of $25,000 from a bank and said that the loan is necessary “for reasonable business purposes” for Lawatch, Ltd., a corporation, and Lawatch Display Fixtures, Inc. In his notification of intention to borrow, plaintiff declared “. . . said money, if obtained, will be used solely for the benefit and best interests of said corporations and in particular for machinery, building improvements and operating capital. . . . That none of said money will be used for any expenses or salary of the said Rudolf Lawatch. That [515]Rudolf Lawatch is the sole and only stockholder in said corporations. ’ ’