Filed 8/27/14 Rodman v. Blake CA4/1
                         NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or
ordered published for purposes of rule 8.1115.


                       COURT OF APPEAL, FOURTH APPELLATE DISTRICT

                                                     DIVISION ONE

                                             STATE OF CALIFORNIA



MICHAEL T. RODMAN,                                                   D061434

      Plaintiff, Cross-defendant, and
Appellant,
                                                                     (Super. Ct. No. 37-2008-00057170-
         v.                                                          CU-CO-NC)

SHARON BLAKE et al.,

      Defendants, Cross-complainants, and
Appellants.


         APPEALS from a judgment and postjudgment orders of the Superior Court of

San Diego County, Earl H. Maas III, Judge. Judgment reversed in part with directions,

affirmed in part; postjudgment order affirmed; postjudgment order reversed with directions.



         Wingert Grebing Brubaker & Juskie, Stephen C. Grebing and Deborah S. Dixon, for

Plaintiff, Cross-defendant, Respondent and Appellant Michael T. Rodman.

         Mara C. Allard for Defendants, Cross-complainants, Respondents and Appellants,

Sharon Blake et al.
       Plaintiff Michael T. Rodman and defendant Sharon Blake formed a limited liability

company (LLC) named Masterpiece Properties (MP) for the purpose of owning 10 acres of

real property (the property) in Rancho Santa Fe, California. MP purchased the property with

a $1 million loan (the mortgage loan), and Blake operated a horse business on the property

through her solely owned corporation, defendant Sharlana Farms, Inc. (Sharlana).1 Rodman

and Blake entered into an operating agreement for MP (the OA) under which each was a 50

percent owner of MP and had the right to effect a subdivision of the property whereby

Rodman would own a parcel consisting of approximately three acres and Blake would own

the remaining seven acres. Under the OA, Blake was responsible for paying $700,000 of the

mortgage loan and Rodman was responsible for paying the remaining $300,000 of the loan.

About seven and a half years after the parties entered into the OA, Rodman sued defendants

for dissolution of MP, an accounting, and other causes of action arising out of Blake's

alleged refusal to cooperate in effecting a subdivision of the property. Defendants

countersued Rodman, seeking, among other things, damages for breach of fiduciary duty and

reformation of the OA. The litigation resulted in a final judgment that reformed the OA,

dissolved MP, ordered a subdivision of the property, and adopted findings of a court-ordered

accounting report.

       Defendants appeal from the judgment, contending the court-ordered accounting is

replete with legal error, the judgment erroneously requires Blake to pay rent to Rodman for

her use of the property, the court abused its discretion either by denying defendants' motion


1     We will refer to Blake individually as Blake and to Blake and Sharlana collectively as
defendants.

                                              2
to reopen evidence before the accounting or denying their motion to set aside the accounting

findings, and the judgment erroneously omits factual findings necessary to a complete

resolution of the litigation. Defendants also appeal a postjudgment order denying their

motion for an allocation of subdivision costs, and an order denying both their and Rodman's

motions for attorney fees. Rodman also appeals the postjudgment order denying attorney

fees. We reverse the portion of the judgment adopting the accounting's findings regarding

the parties' obligations on the mortgage loan and liability for MP's expenses with directions,

and the order denying the motions for attorney fees with directions. We otherwise affirm the

judgment and affirm the postjudgment order denying defendants' motion for an allocation of

subdivision costs.

                     FACTUAL AND PROCEDURAL BACKGROUND

       MP purchased the subject property from Sharlana in January of 2001. At the time of

the purchase, Blake owned five percent of Sharlana's stock and her friend Bryant Morris

owned the other ninety-five percent. According to Blake's first amended cross-complaint,

Blake (Sharlana) acquired the property by purchasing an undeveloped nine-acre parcel for

$550,000 and an adjoining one-acre parcel for $40,000. Morris provided approximately

$290,000 as a down payment and cosigned a loan with Blake for the balance. Morris later

cosigned a $700,000 loan that retired the original mortgage and provided construction funds

to develop the property.

       In the summer of 2000, Rodman made an offer to Blake to purchase the upper three

acres of the property for $375,000, with the understanding that the property would be

subdivided sometime in the future. Blake would use the cash payment to repay the down


                                               3
payment Morris provided to purchase the property. Rodman also offered to obtain a new

$700,000 loan that would be used to pay off the existing first mortgage on the property and

have a lower monthly payment. He told Blake he would help her obtain a construction loan

for the purpose of building a house on her portion of the property. Although Blake had

received an offer to purchase the upper three acres for $600,000, she accepted Rodman's

offer because he agreed to act as her financial advisor and help her obtain a construction

loan.

        In October 2000, Rodman told Blake that he was having trouble obtaining a loan to

cover his $375,000 cash payment. However, he deposited $75,000 in an escrow account to

reassure her that he would obtain the money.

        In January 2001, Rodman told Blake he was unable to come up with the cash portion

of his offer but could obtain a $1 million loan instead of a $700,000 loan to cover $300,000

of his $375,000 cash payment. On January 5, 2001, Blake met Rodman at an escrow office

where he presented her with numerous documents to sign, including the OA and related

documents. Blake testified that she signed all of the documents without reviewing them.

One of the documents she signed on behalf of Sharlana was a lease, under which Sharlana

agreed to pay MP monthly rent for Sharlana's use of the property. Under the OA, Sharlana's

lease payments were to be applied toward Blake's $700,000 share of the MP's mortgage loan.

Because of the new arrangement to purchase the property with the $1 million loan, Rodman

withdrew $70,000 of the $75,000 he had placed in an escrow account. He testified that he

told Blake he withdrew the money and she did not object.




                                               4
       A few days after Blake signed the OA and related documents, Rodman met with her

and said he knew she was upset about the last-minute changes to their deal. He presented her

with a document in his handwriting entitled "Side Adjustments between Sharon and Mike"

(the side adjustments). The side adjustments provided that Sharlana's lease payments would

be $5,750, representing 66 percent of MP's monthly mortgage payment. Rodman would pay

the remaining 34 percent of the loan payments and "take the risk" of interest rates increasing

for the first five years. If the rates decreased in the first five years, Blake's share of the

mortgage payment (i.e., Sharlana's lease payment) would never be greater than 70 percent.

After five years, the parties' split of the mortgage payment would be "70/30." The side

adjustments stated that for five years, Rodman would pay up to $300 per month for

accounting and bookkeeping for MP or Sharlana, and noted that Rodman had paid all of the

closing costs for MP's purchase of the property.

       In August 2008, Rodman filed a complaint against defendants for judicial dissolution,

an accounting, and related causes of action arising out of Blake's alleged refusal "to

cooperate in effectuating the lawful division of the [p]roperty [under the OA]." Rodman's

operative first amended complaint omitted the dissolution cause of action and included

causes of action for specific performance, judicial accounting, breach of contract, and

declaratory relief. Defendants' operative first amended cross-complaint included causes of

action for breach of fiduciary duty, rescission, declaratory relief, reformation of contract and

breach of contract.




                                                 5
       The case was tried to the court in January 2010. In February, Rodman filed an ex

parte application to amend his first amended complaint to include dissolution in his prayer

for relief. Defendants initially opposed the application, but later withdrew their opposition.

The court granted the application.

       In March 2010, the court filed a "Verdict After Court Trial," (the verdict) which reads

like a statement of decision.2 In the verdict, the court found that Rodman was not a

fiduciary to Blake when they entered into their business relationship, "but became one once

they agreed to be in business together." The court found that "Rodman 'sold' himself as the

better buyer to Blake, and reviewed financial documents of Blake before the deal was

finalized." However, based on the parties' testimony, the court found "the parties remained

at [arm's] length until the signing of the documents."3

       The court concluded "even though the parties remained at [arm's] length during

negotiations, this does not relieve the requirement that the documents ultimately executed

reasonably reflect the negotiations of the parties." The court found that although the

handwritten documents reflecting the parties' negotiations and intentions "demonstrate a

reasonable progression of give and take towards a mutually beneficial transaction, the final

documents signed contain virtually none of the significant benefits to Blake, and actually add

significant power and benefit to Rodman, while requiring virtually no capital contribution."



2     Rodman states that the court did not issue a tentative statement of decision and did not
employ Code of Civil Procedure section 634 and California Rules of Court, rule 3.1590(g).

3    We have omitted the trial court's capitalization of the parties' names in the verdict and
judgment.

                                               6
Thus, the court found "that the final documents do not accurately reflect the agreement of the

parties."

       Regarding the OA that created MP and other "final documents," the court found there

was "no evidence that [Blake] had any ability to understand the complicated LLC and other

transactional documents presented to her at, or slightly before, the date of signing[,]" and that

"at closing [Blake] merely signed documents as directed by Rodman." Therefore, the court

granted Blake's request "to reform the contract to comply with the agreement established by

the facts and testimony."

       The court found "the 'lease payments' paid by [Sharlana to MP] were intended to be

her mortgage payment for the lower part of the property. Indeed, were the evidence as

argued by Rodman, that she was only credited for a portion of such payments, the 'deal'

would be so one sided that this Court would likely rescind the entire contract rather than

reform it." Accordingly, the court ruled that "Blake shall be credited with the entirety of her

payments to [MP] towards her portion of the mortgage obligation." The court further found

that the side adjustments were intended to become part of the agreement. Thus, the court

ruled: "To the extent they are enforceable[,] the agreements contained in the [side

adjustments] will be included in the final judgment."

       The court concluded that reformation, followed by an accounting, followed by

dissolution of MP was the proper remedy in this matter. Accordingly, the court granted

Rodman's request to dissolve MP after completion of the accounting and subdivision of the

property. The court ordered "that the agreement between the parties be reformed such that




                                               7
parcels in question be subdivided and that Rodman receives the approximately upper 3 acres

of the [property]. Blake shall receive the lower 7 acres."

       The court further ordered: "The accounting shall evaluate payments made by each

side after considering that the $1,000,000 loan is divided with $700,000 being attributed to

Blake, and $300,000 being attributed to Rodman. All Mortgage/Lease payments made by

Blake shall be accounted towards her portion of the loan. Interest for each portion shall be

attributed to the respective party. All expenses shall be accounted for as follows: [¶] 1. Tax

obligations shall be assessed 50% to each. [¶] 2. Insurance shall be assessed to Blake only.

Legal expenses shall be divided equally. [¶] 3. Accounting and Bookkeeping shall be

charged to Rodman only for the first 5 years, and then divided equally thereafter. [¶] 4. All

closing costs for the sale of the property to [MP] shall be charged to Rodman. [¶] 5. All

'property management' costs shall be [borne] by and charged solely to Rodman. [¶] 6. The

future costs associated with the division of the property [into] separate parcels shall be borne

by the parties equally, with the Court maintaining jurisdiction to allocate them at a later

time." The court ordered that once the subdivision of the property was complete, MP would

be terminated and that "[a]ll legal relationships other than those required of adjacent property

owners or easement holders shall then be terminated."

       In April 2010, defendants filed a "Notice of Joint Designation of Accountant" stating

the parties had agreed to use Brian P. Brinig to perform the accounting ordered in the verdict.

In September 2010, Rodman filed an ex parte application for an order to show cause

regarding Blake's failure to comply with the verdict and defendants, represented by new

counsel, filed a motion to reopen the bench trial "for presentation of additional evidence to


                                               8
facilitate dissolution and accounting." The court denied Rodman's application without

prejudice to refile it after entry of judgment and denied defendants' motion to reopen. On

October 27, 2010 the court entered a "Judgment on Verdict After Court Trial" setting forth

the findings, rulings, and orders in the verdict, including the order for an accounting.

       In September 2011, Brinig submitted his accounting report. The report addressed

how much Blake and Rodman each owed on their respective obligations on the $1 million

mortgage loan and how much each had contributed to MP for expenses. Brinig calculated

that as of July 1, 2011, Blake owed $619,922 on her $700,000 share of the loan and Rodman

owed $67,939 on his $300,000 share. Based on the court-ordered allocation of expenses and

loan payments between Rodman and Blake, Brinig determined Blake owed MP $18,632.45

and Rodman had a claim against MP for $21,089.23.

       In November 2011, defendants filed a motion to set aside the accounting findings

under Code of Civil Procedure section 643, subdivision (c), and Rodman filed a motion to

charge Blake the reasonable value of her occupancy of the property. The court denied

defendants' motion and ordered that the judgment be amended to include the accounting.

The court granted Rodman's motion and ordered Blake to pay Rodman "the rental sum of

[$1,650] per month, beginning January 1, 2012, and continuing on a monthly basis until the

property is legally divided, the property is sold, or [Blake] vacates the entire property." The

court's calculation of the monthly rent was based on its finding that $5,500 per month was

the reasonable rental value of the property and its determination that Blake should pay

Rodman 30 percent of that amount.




                                               9
       On December 15, 2011, Rodman submitted to the court and served on defendants a

proposed "Amended Judgment on Verdict After Court Trial," which included the accounting

findings and Blake's obligation to pay monthly rent to Rodman. About the same time,

defendants submitted and served a proposed "Judgment After Bench Trial and Accounting."

Defendants' proposed judgment differed from Rodman's proposed judgment in several ways,

one of which was that it included a provision for Rodman to reimburse her for 50 percent of

certain expenses that she had claimed but the court had not awarded, stating: "Mr. Rodman

is required to reimburse Ms. Blake directly with 50% of the expenses she paid for the benefit

of [MP] which amounts to ______." The court signed and entered defendants' proposed

judgment on December 20, 2011, but did not fill in any amount for Blake's claimed

expenses.

       Rodman brought an ex parte application requesting the court to reconsider its signing

of defendants' proposed judgment, arguing, among other things, that the signed judgment

included findings the court did not adjudicate. The court issued a minute order explaining

that when it signed defendants' proposed judgment, it had not received Rodman's proposed

amended judgment and erroneously believed there was no dispute as to defendants' proposed

judgment. The court struck the judgment it signed on December 20, 2011 and, on January

25, 2012, signed and entered Rodman's proposed amended judgment with one modification

that is not relevant to this appeal.




                                             10
       Defendants and Rodman both filed motions for attorney fees on the ground they were

prevailing parties under Code of Civil Procedure sections 1032 and 1717. The court denied

both motions, determining "there was no prevailing party in this action, as the results were

mixed and did not constitute an unqualified win for either side."

       Around the time the court entered the final amended judgment in January 2012,

defendants filed a "Motion for Court Order for Subdivision Cost Allocation," seeking a

different allocation of subdivision costs from the 50/50 allocation ordered in the verdict and

judgment. Specifically, defendants requested an order that Blake would not be required to

pay a share of certain mitigation and construction costs included in an estimate of the

subdivision costs. The court denied defendants' motion on February 17, 2012.

                                        DISCUSSION

                                   The Appealable Judgment

       The parties have conflicting views regarding which of the three "judgments" entered

at different times in this case is appealable. Rodman incorrectly views the "Judgment on

Verdict After Court Trial" entered on October 27, 2010 as appealable and reasons that

defendants are barred from seeking review of any findings and rulings it contains because

they did not file a notice of appeal from it and the time to do so has expired.

       "Under the one final judgment rule, ' "an appeal may be taken only from the final

judgment in an entire action." ' [Citations.] ' "The theory [behind the rule] is that piecemeal

disposition and multiple appeals in a single action would be oppressive and costly, and that a

review of intermediate rulings should await the final disposition of the case." ' " (In re

Baycol Cases I and II (2011) 51 Cal.4th 751, 756.) Thus, an appeal may not be taken from


                                               11
an interlocutory judgment. (First Security Bank of California, N.A. v. Paquet (2002) 98

Cal.App.4th 468, 473.) "[O]ne type of an interlocutory judgment is '[w]here the ultimate

judgment will be unconditional, but basic issues of law must be determined before evidence

is heard and a final judgment rendered; e.g., an interlocutory order determining the right to

an accounting, then taking of the account and judgment for the amount found due.' "

(Yeboah v. Progeny Adventures, Inc. (2005) 128 Cal.App.4th 443, 448-449, italics added;

Schlyen v. Schlyen (1954) 43 Cal.2d 361, 367 ["It is the general rule that an interlocutory

judgment ordering an accounting is not final and not appealable."].) The October 27, 2010

judgment was not a final, appealable judgment because it ordered an accounting and

contemplated future findings and rulings based on the accounting.

       Defendants contend the judgment the court mistakenly signed and filed on December

20, 2011 is the final judgment in this case and the amended judgment entered on January 25,

2011 is a nullity. Defendants acknowledge that courts have the power to correct clerical

errors in entered judgments, but argue the court here committed a "judicial error" that cannot

be corrected by amendment. We disagree.

       "A trial court has inherent power to set aside a judgment entered through its own

inadvertence or improvidence, such as a judgment which does not express the court's true

intention or where the court acted in ignorance of some material fact of record. [Citations.]

'But where the error is inherently judicial rather than clerical or inadvertent, the court has no

power to amend its decision.' " (Don v. Cruz (1982) 131 Cal.App.3d 695, 703, italics

added.)




                                               12
       "A clerical error in a judgment is an inadvertent one made by the court which cannot

reasonably be attributed to the exercise of judicial consideration or discretion. [Citation.]

'The test is simply whether the challenged judgment was made or entered inadvertently

(clerical error) or advertently (judicial error).' [Citation.] [¶] It is also settled that '[i]n

determining whether an error is clerical or judicial, great weight should be placed on the

declaration of the judge as to his intention in signing the [judgment].' [Citation.] The

rationale for that rule [is that] '[w]here the error is made by the judge it is seldom clear from

the record or other extrinsic evidence whether the error is judicial or clerical; i.e., whether (a)

he knowingly rendered a judgment without realizing that it was bad in law (judicial error), or

(b) inadvertently or by mistake signed findings or a judgment or order which he did not

intend to constitute his decision. The issue is one of the judge's intent, and the best evidence

is the judge's own statement, either express or implied from the order of correction. Hence,

where the record permits an inference of clerical error, the judge's affidavit or declaration

will be extremely persuasive on appeal.' " (Bowden v. Green (1982) 128 Cal.App.3d 65, 71.)

       The trial court here issued a minute order explaining its decision to strike the

December 20, 2011 judgment and sign the January 25, 2012 amended judgment as follows:

"The proposed judgment submitted by [defendants] was signed on

December 20, 2011. At the time of the signing, neither [Rodman's] proposed Amended

Judgment, nor [defendants'] objections to the proposed Amended Judgment, was in the

possession of the Judge. It appears both were filed, but never delivered to the file itself,

before December 20, 2011. Believing, erroneously, that there was no dispute as to the

proposed Judgment presented by [defendants], the Judgment was signed. The Court


                                                  13
apologizes for the confusion, and for the foolish belief that, in this case, there could ever be

an undisputed order or Judgment. [¶] The court now strikes the judgment signed

December 20, 2011, and signs the proposed Amended Judgment, provided by [Rodman]

with modification."

       Bearing in mind that in determining whether error in signing a judgment was clerical

or judicial, the best evidence is the judge's own statement in the order of correction, (Bowden

v. Green, supra, 128 Cal.App.3d at p. 71), we conclude the court's order clearly shows it

erroneously signed the December 20, 2011 judgment through inadvertence, and that the

erroneously signed judgment did not express its true intention regarding the expenses for

which Blake sought 50 percent reimbursement from Rodman. Thus, the court's error in

signing defendants' proposed judgment was clerical rather than judicial error. The court's

explanation of why it signed defendants' proposed judgment, along with its decision to strike

that judgment, shows that had the court received and considered both defendants' proposed

judgment and Rodman's proposed amended judgment before signing either, it would have

signed Rodman's proposed amended judgment (with the modification) and not defendants'

proposed judgment. Accordingly, the court properly struck the December 20, 2011

judgment and entered the January 25, 2012 judgment.

       Because the October 27, 2010 judgment was interlocutory and the court properly

struck the December 20, 2011 as inadvertently entered, the only final and appealable

judgment in this case is the January 25, 2012 amended judgment. We will hereinafter refer

to the January 25, 2012 amended judgment simply as "the judgment" or "the final judgment."




                                               14
                         I. Defendants' Objections to the Accounting

       A. Calculation of mortgage contributions

       Defendants contend the court erroneously adopted findings from Brinig's accounting

report that are contrary to the court's verdict and judgment. Defendants' first claim of error is

that the accounting report credited only a portion of Blake's entire mortgage/lease payments

to her $700,000 share of the $1 million loan, contrary to the directive in the judgment that

the entirety of her payments to [MP] were to be credited to her portion of the mortgage

obligation. We agree that the accounting report failed to apply Blake's entire payments to

her share of the mortgage loan as the judgment requires.

       The court's verdict, the October 27, 2010 interlocutory judgment, and the final

judgment all contain the following directive: "The accounting shall evaluate payments made

by each side after considering that the $1,000,000.00 loan is divided with $700,000.00 being

attributed to Blake, and $300,000.00 being attributed to Rodman. All Mortgage/Lease

payments made by Blake shall be accounted towards her portion of the loan. Interest for

each portion shall be attributed to the respective party." (Italics added.) As noted, the court

also stated in its verdict: "[T]he 'lease payments' paid by [Sharlana to MP] were intended to

be her mortgage payment for the lower part of the property. Indeed, were the evidence as

argued by Rodman, that she was only credited for a portion of such payments, the 'deal'

would be so one sided that this Court would likely rescind the entire contract, rather than

reform it. In any event, Blake shall be credited with the entirety of her payments to [MP]

towards her portion of the mortgage obligation." (Italics added.)




                                               15
      We construe the above-italicized language in the verdict, interlocutory judgment, and

final judgment to require that the accounting credit 100 percent of any monthly

mortgage/lease payment made by Blake to her $700,000 share of the mortgage loan,

regardless of the amount of the total mortgage payment in any particular month. The

accounting report shows that Brinig did not follow that directive. For example, from

October 2002 through June 2003 and in a number of months in 2004, Blake made a $5,500

mortgage/lease payment to MP and Rodman paid $6,000 on the loan.4 In his accounting,

Brinig credited Blake with 70 percent of those $6,000 payments or $4,200 instead of $5,500,

which amounts to almost 92 percent of a $6,000 loan payment. Brinig credited the

remaining $1,800 of those payments to Rodman. Brinig's allocation of 70 percent of a loan

payment to Blake in months where it appears from his tables that her monthly

mortgage/lease payment covered over 90 percent of the loan payment indicates that Brinig

was allocating a portion of her payments to Rodman's share of the loan or MP's expenses.5



4      In July 2001, the parties agreed that Blake's monthly mortgage/lease payment would
be $5,500, and Rodman's would be $2,000. The accounting report shows the total mortgage
payment was $6,000 from August 2002 through March 2005. It then went up to $6,100 from
April through August of 2005, after which it was $6,400 from September 2005 through
December 2006. It then became $7,526 until February 2009 when it dropped to $5,971. In
October 2010 it dropped to $5,826. The accounting shows four loan payments from January
through June of 2011 (the end of the accounting period) in the amounts of $5,981, $4,500,
$1,345, and $5,971.

5      Brinig explained in his report that loan payments were allocated 70 percent to Blake
and 30 percent to Rodman in accordance with the 70/30 division specified by the
interlocutory judgment. He further explained that "where there was insufficient capital in
either member's capital account to cover the [member's] respective 70% or 30% portion of
the loan payment, the insufficiency was covered by the other member . . . ."


                                             16
Either way, applying less than 100 percent of Blake's mortgage/lease payments to her

$700,000 share of the mortgage loan was contrary to the express directive in the

interlocutory judgment and final judgment.6

       We recognize that during the July 14, 2011 hearing, the court gave Brinig oral

instructions that are inconsistent with the express language in the judgment requiring all

mortgage/lease payments by Blake to be accounted toward her portion of the loan. At the

beginning of the hearing Brinig asked the court if he should apply all of Blake's rental

payments to the mortgage, or use a portion of them for ongoing expenses. The court stated it

would defer answering that question until after the parties had questioned Brinig. Brinig

then asked: "If [Blake] has more money than her 70 percent share of the mortgage payment

on the day of the mortgage payment—and let's just say the mortgage payment is [$10,000]. .



6       The court held a hearing on July 14, 2011 to provide the parties and the court an
opportunity to question Brinig and provide Brinig the opportunity to obtain clarifying
instructions from the court regarding the accounting. The court issued an order after that
hearing in which it stated: "The court orders the mortgage payment to be split 70/30 with
Ms. Blake making her monthly payments in the amount of 70% of the mortgage payment
and Mr. Rodman paying 30% of the mortgage payment. All of Ms. Blake's payments will be
applied toward her $700,000 mortgage obligation and are to be treated as mortgage
payments not 'lease' payments for accounting and tax purposes. Mr. Rodman and
Ms. Blake are ordered to pay [MP's] expenses as follows pursuant to paragraph 8 of the
[October 27, 2010] Judgment: property taxes 50/50; legal expenses 50/50; accounting and
bookkeeping 50/50; Ms. Blake pay 100% of insurance; and costs associated with the
subdivision are 50/50[.]" (Italics added.)
        This language requires Blake's monthly mortgage payment to be at least 70 percent of
the total mortgage payment, but does require the amount of any payment in excess of 70
percent to be applied to expenses. To the extent the order can be construed as allowing
portions of Blake's payments in excess of 70 percent of the loan payment to be applied
toward MP's expenses instead of Blake's $700,000 mortgage obligation, it is inconsistent
with the verdict and the interlocutory and final judgments.


                                              17
. . But if it's ten grand and she has ten grand in her capital account, does she get more credit

for that mortgage payment than her 70 percent share?"

       Later in the hearing the court stated: "So I'm going to instruct you [that Blake's

mortgage/lease payments] should be applied first to the loan, right? . . . But to the extent on

any month there's an additional amount in excess . . . , that should be applied to the existing

expense, keeping in mind the Court reassessed the expenses. That's why they are not called

for in the agreement, because I went back and said you have to pay half of this, this

percentage [of] that." The court illustrated, "Let's say $10,000 was the amount of the

payment, and she paid $7,000. [$]7,000 would go to the loan. During some month [the

payment] goes down to $9,000. But she still pays $7,000. That amount over her 70 percent

share goes to expenses."

       Thus, the court instructed Brinig that regardless of the amount Blake paid in a given

month, he should never apply more of her payment to that month's loan payment than her 70

percent share, and if there were money left after applying the loan payment, it was to be

applied to her share of expenses. To the extent her balance left over from her loan payments

was insufficient to meet her share of expenses, it would become a negative balance to be

paid from her next lease payment, which could result in that lease payment being insufficient

to cover her 70 percent of the next mortgage payment.

       The court's oral directives explain why Brinig did not apply the entirety of Blake's

$5,500 payments to her share of the loan when the loan payments were $6,000, but rather

applied only 70 percent of $6,000 or $4,200 to her share of the loan. However, it is unclear

from Brinig's amortization tables or elsewhere in his report to what extent Brinig applied the


                                               18
remaining $1,300 of her payments to MP expenses versus Rodman's share of the monthly

loan payment. In any event, the court's oral directive is inconsistent with the language in the

verdict and the interlocutory and final judgments that clearly requires the accounting to apply

the entire amount of Blake's mortgage/lease payments to her share of the mortgage loan,

regardless of whether a payment is greater or less than 70 percent of the total payment. The

final judgment controls over the court's oral directive (In re Marcus (2006) 138 Cal.App.4th

1009, 1015-1016; Jespersen v. Zubiate-Beauchamp (2003) 114 Cal.App.4th 624, 633), and

to the extent the court's written order after the July 14, 2011 hearing is inconsistent with the

final judgment, the judgment controls over the inconsistent prior order. (Maywood Mutual

Water Co. v. County of Los Angeles (1970) 12 Cal.App.3d 957, 960 [trial court's formal

judgment generally may not be impeached by a prior inconsistent order]; Oldis v. La Societe

Francaise De Bienfaisance Mutuelle (1955) 130 Cal.App.2d 461, 472 [no antecedent

expression of the trial court can restrict its absolute power to render a final decision].)

       In accordance with the court's verdict and interlocutory and final judgments, the

accounting should have applied the entirety of Blake's mortgage/lease payments to her share

of the loan, and no part of those payments should have been applied in the accounting toward

her expenses or Rodman's share of the mortgage loan. The accounting findings in the

judgment will have to be modified accordingly, with the result being that under the modified

judgment, Blake will owe less on her share of the loan and Rodman may owe more to the




                                                19
extent portions of Blake's mortgage/lease payments were credited to his share of the loan.7

Blake will owe more in expenses to the extent the accounting applied any part of her

mortgage/lease payments to her share of MP's expenses.

       B. Interest on expenses

       Defendants contend Brinig's report improperly charges her approximately $140,000 in

interest on expenses Rodman paid from the MP account. How defendants view the

accounting as charging interest on expenses and how they arrived at the amount of $140,000

is difficult to fathom. Defendants argue the interest amount of "$140,000 is figured as" the

approximate difference between the $619,000 Brinig found Blake owed on the mortgage in

his final report and $479,025—the amount they contend Brinig should have found based on

an un-final draft amortization he prepared before submitting his final report. In that draft,

Brinig applied Blake's entire mortgage lease payments to her share of the loan. The

unarticulated analysis in defendants' argument appears to be that interest on Blake's share of

the mortgage loan that was not reduced because of the accounting's failure to credit her

mortgage payments entirely to her share of the mortgage is equivalent to interest charged on

her share of the expenses.




7      Brinig testified that if Blake's payment of her share of expenses is deferred until the
dissolution of MP and "fronted by Mr. Rodman over the life of the deal, . . . Rodman would
owe about $120,000 more than he otherwise would owe . . . . Because that would mean that
Rodman had way less money in the deal to make his share of the mortgage payments. So
when you carry that logic over to the amortization schedule, Rodman was paying expenses,
not mortgage payments, so he owes about $120,000 more of the mortgage."

                                               20
       Rodman's counsel raised the issue of interest on expenses in a letter to Brinig dated

June 29, 2011. Rodman's counsel proposed two alternatives for Brinig to use in accounting

for expenses: "One choice (in your model) is that 100% of their respective payments are

first used to amortize each party's respective share of the loan amortization before taking into

consideration proportionate expenses that previously occurred. Then, add back the

respective amounts due for both parties at the end of the calculation. [¶] The alternative

choice (in your model) is that each party is first charged with their proportionate expenses as

they occurred, and the remaining net payments made by the parties are calculated towards

their respective share of the loan amortization after such expenses are paid as they were

incurred." Brinig used the second alternative with the court's approval. However, there is

nothing in the record, including Brinig's final report, or the parties' briefs that supports

defendants' assumption that the difference between the amount Blake owes on the mortgage

loan under the final accounting report and judgment and what she would owe if Brinig had

applied the entirety of her mortgage/lease payments to her share of the loan is properly

viewed as interest charged on her share of MP's expenses.8



8       Defendants in their opening brief assert that the court approved "Rodman's proposal
that Blake be charged interest on expenses Rodman had paid through the LLC account,
ostensibly for the LLC's benefit." Defendants' record citation for that assertion is to a
discussion between Brinig, defendants' counsel, and the court about how Brinig should
handle MP's expenses. Defendants' counsel stated Blake "has a whole bunch of expenses
that she was paying outside this LLC account. So how does that figure into it as she's paying
loans with this amortization schedule?" Brinig stated, "Just so you know, I said in one of my
letters I will list them. They will, in my view, never be an integral part of [MP]. [When the
court sees] the list, [it] may decide to do something with them. I don't think they will ever tie
in to [MP]. I'm trying to give you a little bit of both, Ms. Allard. I don't have a problem
listing [the expenses], and I don't have a problem telling you how much they add up to." The

                                                21
       In any event, because defendants' contention that Blake was improperly charged

interest on her share of expenses is based on the failure of the accounting to apply the entire

amount of lease/mortgage payments to her share of the mortgage loan, the issue is moot in

light of our conclusion that no part of Blake's mortgage lease payments are to be applied

toward expenses. However, that conclusion raises the question whether Blake should be

charged predissolution interest on her share of expenses in the judgment on remand.9 The

answer is no.

       "[I]n a partnership dissolution the amount due partners does not become settled or

determined until the account is stated by the trial court at the end of the trial." (Mashon v.

Haddock (1961) 190 Cal.App.2d 151, 180.) Therefore, "[t]he general rule has always been

that except where there has been a fraudulent retention or an improper application of money

of a partnership, it is not the practice of the courts to charge a partner with interest on money


court then said to defendants' counsel, "Ultimately—again, sounds like you have to come
back to me and say we should get credit . . . for X, Y, and Z." (Italics added.) Defendants'
counsel said she would like to be heard on that point. The court told her she "would be
reserving [on that issue]," and that the matter would have to be addressed after the
accounting was completed.
       Defendants cite the court's italicized statement as showing that the court adopted
Rodman's proposal to charge interest on expenses. However, the court's statement, whether
read in isolation or in context of the discussion in which it was made, has nothing to do with
charging interest on expenses.

9       Rodman's respondent's brief does not address the issue of whether the accounting did
or should have charged interest on Blake's share of MP's expenses. However, in Rodman's
counsel's June 2011 letter to Brinig, counsel argued: "The allocation of gross or net
payments to the amortization of the total loan does not require one party to front the non-
mortgage related costs before the other party contributes their share of such expenses. We
believe it would be unfair for one party or the other to have to uniquely advanced expenses
in a calculation, and in effect be reimbursed at the end, unless interest at the same rate of the
mortgage is credited to that party."

                                               22
in his hands after dissolution, and under ordinary circumstances a partner is not charged with

interest on sums drawn out by him or advanced to him." (Ibid.; Burge v. Michael (1963) 213

Cal.App.2d 780, 790 ["A partner or joint adventurer is not entitled to interest on his capital

contribution prior to an accounting unless it is expressly so agreed among the partners or

joint adventurers."]; Luchs v. Ormsby (1959) 171 Cal.App.2d 377, 388; [as a general rule

interest is not allowable on unascertained balances remaining in one partner's hands after

dissolution of the firm]; Freese v. Smith (1952) 114 Cal.App.2d 283, 290 [same].) We see

no reason this general rule, and other principles applicable to partnership dissolution, should

not apply equally in an action for dissolution and accounting of a limited liability company.

Because there is no issue in this case regarding any fraudulent retention or improper

application of MP's money by Blake, Rodman is not entitled to interest on any portion of

Blake's share of MP's expenses that he advanced before the accounting.

       C. Liability for Rodman's capital contributions

       Defendants contend the judgment erroneously adopted an accounting method that

charged Blake with liability for Rodman's capital contributions. Specifically, defendants

complain that the accounting improperly applied portions of Blake's lease/mortgage

payments to Rodman's share of the mortgage loan, essentially rehashing their first challenge

to the accounting. Defendants cite Jones v. Wagner (2001) 90 Cal.App.4th 466 (Jones) for

the proposition that absent an agreement otherwise, a partner has no legal or equitable duty

to make additional partnership contributions upon another partner's failure to make

contributions he or she owes under the partnership agreement. (Id. at pp. 472-473.)

Defendants contend the side agreement plainly contemplates independent contribution


                                               23
obligations, and the verdict and judgment require all of Blake's payments to MP to be

credited toward "her portion of the mortgage obligation." Thus, defendants argue, there is no

legal basis for applying Blake's contributions to MP to make up for Rodman's capital

deficits.

       Because we have determined that the accounting erroneously applied portions of

Blake's lease payments to Rodman's share of the mortgage loan contrary to the directive in

the verdict and judgment that they be applied entirely to her share of the loan, we need not

consider defendants' additional argument on that point based on Jones.

                               II. Blake's Obligation to Pay Rent

       As noted, the court granted Rodman's motion to charge Blake the reasonable value of

her occupancy of the property. Accordingly, the final judgment states: "The Court further

determines and finds the reasonable rental value of the 10 acres of real property owned by

[MP] is $5,500 per month. [¶] . . . As of January 1, 2012, Ms. Blake is ordered to pay Mr.

Rodman $1,650.00 (30% of the reasonable rental value) each month for her occupancy of the

real property owned by [MP] or any portion of the entire 10 acres." The judgment orders

Blake to pay the monthly rent of $1,650.00 until she "vacates the property, the property is

sold or is legally divided."

       Defendants contend the court's order that Blake pay rent to Rodman is unsupported by

the evidence because there is no evidence that Rodman could not use the upper three acres of

raw land pending subdivision. Additionally, defendants cite Hunter v. Schultz (1966) 240

Cal.App.2d 24, 30-31 (Hunter) for the proposition that, in defendants' words, "[a]ssessment

of rental value is authorized by law as a defensive offset only for contribution and is not


                                              24
available as it was ordered by the court as a prospective remedy with no reference to

contributions or offsets for the improvements on the property paid for by Ms. Blake."

Rodman does not address this issue in his respondent's brief.

       As a general rule, a cotenant out of possession of real property has no right against

another cotenant in exclusive possession of the property to recover rental value for

occupancy and use of the property, because each cotenant has the right to occupy the

property. (Teixeira v. Verissimo (1966) 239 Cal.App.2d 147, 155; Brunscher v. Reagh

(1958) 164 Cal.App.2d 174, 176-177.) However, there are three exceptions to the general

rule: (1) where there is an agreement between the cotenants to share rents and profits

(Teixeira, supra, 239 Cal.App.2d at p. 155; Black v. Black (1949) 91 Cal.App.2d 328, 332);

(2) where the cotenant in possession has ousted the cotenant out of possession (Estate of

Hughes, supra, 5 Cal.App.4th 1607, 1611; Teixeira, supra, 239 Cal.App.2d at p. 155); or (3)

where the cotenant in possession demands contribution for expenditures on behalf of the

cotenancy, the court, as a matter of equity, may award the cotenant out of possession the

reasonable value of the other cotenant's use of the property as an offset against the

contribution for expenditures. (Hunter, supra, 240 Cal.App.2d at pp. 31-32; In re Fazzio

(Bnkr. E.D.Cal. 1995) 180 B.R. 263, 269.)

       As equal members of MP, which under the judgment is not dissolved until the

subdivision of the property is complete, Rodman and Blake are cotenants of the property

until it is subdivided with an equal right to occupy the property, absent an agreement to the

contrary. (Tom v. City and County of San Francisco (2004) 120 Cal.App.4th 674, 677.) In

his motion to charge Blake the reasonable value of her occupancy of the property, Rodman


                                               25
cited Civil Code section 843 subdivisions (a), (c), and (d) as addressing, in his words, "when

one cotenant or owner seeks to require another cotenant or owner to pay for the reasonable

value of the [other] cotenant's use of the property." Civil Code section 843, subdivision (a)

provides that a tenant out of possession may establish ouster from a tenant in possession, and

subdivision (c) addresses the availability of a claim for damages for an ouster. Subdivision

(d) authorizes the cotenants to make "an agreement as to the right of possession among the

cotenants, the payment of reasonable rental value in lieu of possession, or any other terms

that may be appropriate." Rodman's citation to this statute indicates he was aware of the

general rule precluding him from recovering rent from his cotenant Blake and the "ouster"

and "agreement" exceptions to the rule.

       Although Civil Code section 843 provides a statutory mechanism for establishing

ouster, ouster may also be established under common law principles. " 'An ouster, in the law

of tenancy in common, is the wrongful dispossession or exclusion by one tenant of his

cotenant or cotenants from the common property of which they are entitled to possession.'

[Citation.] Whether there has been an ouster is a legal question." (Estate of Hughes, supra,

5 Cal.App.4th at p. 1612.) "[A]t common law ouster was established by a cotenant's

unambiguous conduct manifesting an intent to exclude another cotenant from gaining or

sharing possession of jointly owned property." (Id., at p. 1614.) Thus, "an ouster is 'proved

by acts of an adverse character, such as claiming the whole for himself, denying the title of

his companion, or refusing to permit him to enter. Actual or constructive possession of the

ousted tenant in common at the time of the ouster is not necessary. [Citations.]' [Citation.]

'[A]n action by a tenant in common against his cotenant to be admitted into the possession, a


                                              26
denial in the answer of the plaintiff's title and right of entry is equivalent to an ouster.' " (Id.,

at p. 1615, italics added, original italics omitted.) Thus, an "ouster may occur in a peaceful,

non-aggressive manner through lawful means . . . ." (Ibid.) "Whenever an ouster occurs the

rental obligation accrues. Consequently the manner of its accrual is irrelevant provided the

cotenant in possession reasonably understands the effect of his or her behavior." (Ibid.)

       The court made no express findings in its order granting Rodman's motion to charge

Blake for her occupancy of the property. Consequently, "we infer that it made every implied

factual finding necessary to support its order and review those implied findings for

substantial evidence." (Chin v. Advanced Fresh Concepts Franchise Corp. (2011) 194

Cal.App.4th 704, 708.) We conclude there was sufficient evidence to support the implied

finding that Blake ousted Rodman from the property and Rodman was therefore entitled to

recover reasonable rental value for Blake's exclusive use of the property.

       In its order granting Rodman's motion the court stated it "fully considered . . . the

evidence presented . . . ." Rodman filed a declaration in support of his motion to charge

Blake rent in which he stated: "I have never been allowed to use the property or occupy the

property in any manner. In fact, Ms. Blake threatened to call her 'security' on me when I

attempted to visit the property in 2010, even though my attorneys provided her attorney

notice of my intended visit. I have been precluded from using the property in any regard. I

am not allowed to even visit the property, nor reside on the property, even though Mr.

Brinig's report demonstrates I have substantially paid my obligation to [MP] . . . ." Rodman's

reply to defendants' opposition to his motion included a declaration in which he similarly

averred: "I have been unable to even visit the property since 2008, even with my attorneys


                                                 27
notifying Ms. Blake of my intent to visit the property for the purpose of evaluating the 3

upper acres. On one specific instance, Ms. Blake threatened to call her 'security' team if I

entered the property and she verbally told me and my guest to get off the property."

       Based on these averments in Rodman's declarations, the court could reasonably find

that Blake ousted Rodman from possession of the property by refusing to permit him to

enter. Accordingly, the court reasonably charged Blake rent for her occupation of the

property until the property is subdivided, and reasonably limited the amount of rent to 30

percent of the entire property's reasonable rental value based on the percentage of the

property Rodman will own after subdivision.

    III. Denial of Defendants' Motions to Reopen Evidence and Set Aside the Accounting

       Defendants contend the court abused its discretion by denying their motion to set

aside the accounting after denying their motion to reopen evidence relevant to dissolution.

They argue that taken together, the orders denying these motions deprived Blake of due

process because no cause of action for dissolution was litigated at trial; therefore, Blake did

not have an opportunity at trial to offer evidence relevant to dissolution, such as evidence

concerning contributions and disbursements by Blake and Rodman and allocation of tax

benefits.

       Defendants complain that the court denied their motion to reopen on the premise their

evidence relevant to dissolution would be considered by Brinig, and Brinig would make the

relevant findings in the accounting. Defendants contend they were forced to move to set

aside the accounting findings because Brinig did not make requested factual findings. They

argue that the court should have either granted their motion to reopen evidence or, in ruling


                                               28
on their motion to set aside the accounting findings, ordered Brinig to make their requested

findings or ruled itself on the requested findings. Rodman ignores this issue except to note

that he and defendants agreed after trial to include dissolution as a remedy, and that

defendants filed two substantially identical motions that challenged the accounting

findings—a "motion for adjustments to accounting findings," which the court denied on

October 14, 2011, and a "motion to set aside accounting findings," which the court denied on

December 5, 2011.

       "Trial courts have broad discretion in deciding whether to reopen the evidence.

[Citation.] We review a court's denial of a motion to reopen evidence for an abuse of

discretion. [Citation.] The appropriate test for abuse of discretion is whether the trial court's

decision exceeded the bounds of reason." (Horning v. Shilberg (2005) 130 Cal.App.4th 197,

208-209.) Here, it was not an abuse of discretion to deny the motion to reopen because the

court reasonably concluded that factual issues regarding the dissolution and accounting could

be adequately adjudicated through the accounting process and the opportunity to challenge

the accounting findings. Accordingly, the key issue regarding defendants' assignment of

error is whether the court erred in denying defendants' motion to set aside the accounting

findings.

       In determining the rights of the parties in an action for a dissolution of a partnership,

an accounting between the partners, and settlement of the partnership's affairs, the trial court

applies equitable principles and its decision is reviewed for abuse of discretion. (Bates v.

McTammany (1938) 10 Cal.2d 697, 700; Heller v. Pillsbury Madison & Sutro (1996) 50




                                               29
Cal.App.4th 1367, 1392.) Accordingly, we review the court's decision to deny defendants'

motion to set aside the accounting findings for abuse of discretion.

       We conclude the court's denial of defendants' motion to set aside the accounting

findings was neither an abuse of discretion nor a denial of Blake's right to due process. In

their opening brief, defendants argue the denial of their motion to set aside the accounting

findings was prejudicial because the accounting accepted Rodman's claimed expenses as

legitimate and applied portions of Blake's lease/mortgage payments to expenses and

Rodman's share of the mortgage instead of applying the entire payments to Blake's share of

the mortgage. The latter contention is moot in light of our conclusion that the accounting

and judgment must be corrected to apply Blake's entire mortgage lease payments to her share

of the mortgage.

       Regarding the accounting's acceptance of Rodman's claimed expenses, the expense

item defendants objected to in their motion to set aside the accounting findings was the

attorney fees paid to attorney Rick Elliot in connection with a lawsuit against MP filed by the

O'Briens (the O'Brien action), who were neighboring property owners. The O'Brien's

complaint included claims for trespass, encroachment, nuisance, and declaratory relief,

alleging, among other things, that Blake/Sharlana's business violated zoning ordinances and

caused damage to the O'Briens's property. Defendants claimed Elliot had a conflict of

interest and that Rodman ignored Elliot's advice to tender a claim to MP's insurance

company and told Blake he would personally cover Elliot's fees.




                                              30
       As Rodman pointed out in his opposition to defendants' motion, the issues of Elliot's

tender advice and MP's payment of his fees were litigated at trial,10 after which the court

ruled in the verdict and judgment that legal expenses were to be divided equally between

Rodman and Blake with no reference to any issue regarding Elliot's fees. Thus, the court

impliedly found that Elliot's fees were properly treated as an expense of MP. We will not

disturb the judgment based on the court's denial of defendants' motion to set aside the

accounting findings.

                     IV. Findings Not Expressly Included in the Judgment

       Defendants contend the judgment erroneously omits factual findings necessary to an

equitable settlement upon dissolution and full determination of the parties' claims. Before

addressing the specific findings that defendants claim were omitted from the judgment, we

note that apparently there was no request for a statement of decision under Code of Civil

Procedure, section 632 in this case, perhaps because the trial court employed the

questionable procedure of issuing a "Verdict After Court Trial."11 "A party's failure to



10   Rodman and Blake were questioned at trial about Elliot's representation and MP's
payment of his fees.

11      We are aware of no authority for a trial court to render a "verdict" after a court trial.
In common parlance, a verdict is rendered by a jury, not a court sitting as the trier of fact.
(Howser v. Chicago Great Western R. Co. (Mo. 1928) 5 S.W.2d 59, 64-65 ["The word or
term 'verdict,' as used in legal phraseology, and in common parlance as well, is understood
generally to mean the pronouncement, finding and determination of a jury upon an issue of
fact as between two opposing and contending parties."]; see Code Civ. Proc., §§ 613-630.
As noted, the court's verdict in this case reads like a statement of decision. We disapprove
the practice of rendering a "verdict" in lieu of a statement of decision after a court trial to the
extent it discourages parties from invoking the procedure for obtaining a statement of
decision under Code of Civil Procedure sections 632 and 634.

                                                31
request a statement of decision when one is available has two consequences. First, the party

waives any objection to the trial court's failure to make all findings necessary to support its

decision. Second, the appellate court applies the doctrine of implied findings and presumes

the trial court made all necessary findings supported by substantial evidence." (Acquire II,

Ltd. v. Colton Real Estate Group (2013) 213 Cal.App.4th 959, 970.

       A. Blake's capital contribution brought to MP

       Blake contends the judgment omits any factual findings on her request to the trial

court that she be credited with contributing approximately $400,000 of equity to MP,

corresponding to grading and other improvements she put on the property to render it

suitable for her horse business. She asserts that her improvements to the property increased

its appraised value from $590,000 to $1,400,000.

       In its verdict and judgments, the court found that "all improvements upon, and

fixtures within the subject real estate are the exclusive property of Defendants Blake and

Sharlana Farms . . . ." The verdict additionally states: "There is no reasonable argument or

evidence that the stables, barns, corrals, etc., belong to [MP]." During an ex parte hearing in

December 2010 concerning the then ongoing accounting, Rodman's counsel objected to

Blake's unlitigated claim that $177,000 she spent for improvements and a mobile home on

the property were MP's expenses. The court stated, "I made a finding in the judgment that

all of the improvements on the property were Ms. Blake's property. So those wouldn't, in my

mind, be part of the accounting."




                                               32
       By defendants' own argument, the increase in value of the property from $590,000 to

$1,400,000 was due to her improvements to the property. Defendants requested credit for

$400,000 in equity corresponding to those improvements in their motion to set aside the

accounting findings. Based on the court's denial of that motion, its finding that the

improvements were entirely Blake's property, and its observation that because the

improvements were Blake's property, the money she spent on them should not be part of the

accounting, we conclude the court impliedly and reasonably found that the $400,000 in

equity attributable to Blake's improvements was exclusively an asset of Blake and Sharlana

and not a capital contribution to MP. The judgment is not defective for failing to expressly

make that finding.

       B. Blake's claimed expenses

       Defendants contend the court erred by failing to include in the judgment findings on

Blake's request to have her claimed MP expenses incorporated into the accounting. Brinig

simply listed Blake's claimed expenses and deferred to the court to decide whether they were

properly included in the accounting. Defendants request that we remand and direct the trial

court to modify the judgment by crediting Blake with her claimed expenses, which she lists

in her opening brief.

       We conclude the court impliedly found Blake's claimed expenses were personal to her

and Sharlana and were not expenses of MP. The judgment that the court mistakenly signed

on December 20, 2011 and later struck included a provision requiring Rodman to reimburse

Blake for 50 percent of the expenses Blake claimed she paid for the benefit of MP. The fact

that the final judgment the court ultimately entered on January 25, 2012 omitted any


                                              33
provision regarding Blake's claimed expenses shows the court decided those expenses were

not properly included in the accounting and judgment as expenses of MP.

       Blake's claimed expenses included attorney fees she paid in the O'Brien litigation for

attorney Don Vaughn, who represented her and Sharlana in the O'Brien litigation, and the

cost of improvements she made to the property. In his opposition to defendants' motion to

set aside the accounting findings, Rodman contended Vaughn represented defendants and not

MP, and that all of the attorney fees and legal expenses incurred to defend the O'Brien action

were due to Blake's business activities and did not relate to any conduct by Rodman or MP.

In a declaration he noted that neither he nor MP had been partners in Sharlana or received

any of Sharlana's revenues or profits. He also correctly pointed out that Blake did not claim

that Vaughn's fees and her other claimed expenses were expenses of MP until after trial.

Based on these circumstances, the court could reasonably find Blake's claimed expenses

were personal to her and Sharlana and were not expenses of MP. Accordingly, we deny

defendants' request to modify the judgment by crediting Blake with her claimed expenses.

       C. Allocation of tax benefits from improvements on the property

       Defendants contend the judgment fails to reallocate tax losses as the court directed in

its verdict. In relevant part, the verdict states: "The court is troubled by the apparent

inconsistency between the treatment of personal property located on the real estate, and the

tax benefits which it provides. There is no reasonable argument or evidence that the stables,

barns, corrals, etc. belong to [MP] . . . . The evidence is persuasive, and the Court finds, that

all improvements upon, and fixtures within the subject real estate are the exclusive property

of Defendants Blake and Sharlana Farms. However, the documents submitted to the Court


                                               34
indicate that the tax benefits of those items flowed to [MP] and were then divided between

Rodman and Blake equally. In essence, the evidence supports that Blake should have

benefitted from the depreciation of the improvements to the property, most of which predate

the formation of [MP]. This will need to be reconciled during the Accounting."

       The verdict does not clearly direct reallocation of tax losses; it reflects that when the

court rendered the verdict, which was before the accounting was undertaken, the court was of

the view that the tax losses could and should be reallocated in the accounting. However, at a

pre-accounting hearing in October 2010, defendants' present counsel told the court that Blake

had paid her own accountant to look at the case and the accountant reported, in Blake's

counsel's words, that "these tax losses, the valuation, everything, it's all a fraud."12 Blake's

accountant recommended Blake have no part of the false valuation of the property to share in

the tax loss. Blake's counsel stated: "The truth was [Rodman] gave himself 100 percent of

her tax losses. The court wants it split 50/50. [Blake is] now in the position where she

doesn't want to take 50 percent of a fraudulent tax loss[.]"

       During the July 14, 2011 hearing, Brinig testified under questioning by Blake's

counsel that he was having problems with trying to restructure or redo the tax allocations as

the verdict requested. He testified, "I am not capable of correcting the tax treatment of

[MP]" and he did not "think that anyone could correct [MP's] reporting. So it's kind of a


12     Presumably, the "fraud" that Blake's counsel was referring to was related to the
following statement in the court's verdict: "Another anomaly was the decision, at Rodman's
direction, to show the purchase price [of the property] as $700,000.00 for the entire deal.
There was no reasonable explanation for doing so, leaving the Court to surmise the purpose
was to defraud the State and County of San Diego Tax Collectors. This reflects poorly on
both parties to the transaction."

                                               35
mess. I'm not able to sit here and perfectly summarize why it's a mess. But—and at some

other level, it's probably beyond my capability to fix."

       Brinig later suggested that if a court were to decide Rodman had unfairly realized tax

benefit from the depreciation of the improvements, it could be reasoned: " 'Okay, he got

[deductions] in these many years for this much.' And then somebody could figure out some

economic consequence or theoretical benefit to him of that possibly. And let's say it came

out to be $30,000. . . . [T]he court could then say, 'You know what, she should have gotten

half of it. Pay her 15.' But the other question is, are they the same to each person?

Meaning, he might have a lot of income; so therefore, a deduction for him is worth

something. The other hypothetical person might not. So a deduction for them isn't worth it.

There's all that kind of stuff that I can't begin to process." Thus, Brinig recognized it would

be extremely difficult to determine, in hindsight, how much Blake would have benefitted

over the years if she had taken half of the tax deductions that Rodman claimed, because the

amount of tax savings would be different for each party due to their differing income and

other factors.

       In September 2011, defendants filed a "Motion for Court Order Regarding [MP] Tax

Treatment," in which they claimed that tax forms prepared for Rodman and his wife showed

that beginning in 2001, Rodman took 100% of the tax losses for the improvements Blake

made to the property. They requested an order that "all future preparation of [MP]

taxes . . . be prepared in light of the verdict[,] which states that her payments are to be treated

as mortgage payments not lease payments. Additionally Ms. Blake requests court orders

with respect to the tax loss allocations ordered in the verdict." (Italics added.) Defendants


                                                36
argued that if that the tax loss reallocation referenced in the verdict cannot be accomplished

as Brinig essentially testified, Blake should be credited in the accounting with an initial

capital contribution of $350,000 corresponding to the improvements she made and on which

Rodman took the tax loses.

       In opposition to defendants' motion, Rodman argued the treatment of tax losses had

not harmed Blake because there is no cash value to any depreciation until the property is

sold. Rodman represented that Blake had been "told repeatedly by [MP's accountant] that

the tax losses would only potentially convert to an actual cash value when the property is

sold. Until that time there is no value to tax losses [because] they are 'paper' losses. [¶] Due

to the passive loss rules, . . . a cash benefit resulting from any losses or depreciation can only

be potentially converted when [MP] is dissolved and [the] property sold" Thus, Rodman

argued, there was no legal basis to deem the tax losses to be equivalent to a $350,000 capital

contribution. Rodman asserted that the treatment of MP's tax losses had been litigated at

trial, stating he testified that Blake did not benefit from the tax losses because she did not file

personal tax returns, and that she and Rodman had agreed Rodman would take the tax

benefits until such time as it would benefit Blake to receive the value of the depreciation.13




13     We did not find such extensive testimony about MP's treatment of the tax losses in the
reporter's transcript of the trial. On direct examination, Rodman testified that before MP was
created and purchased the property, he proposed taking 100 percent of the tax losses on the
property because his income was higher than Blake's, and they could use "some of my tax
savings to help." However, Rodman's counsel averred in a declaration in opposition to
defendants' "tax treatment" motion that "we were informed through discovery that Ms. Blake
had not filed personal tax returns for many years . . . . Further, we were informed by [MP's
accountant] that he understood there to be an agreement whereby since Mr. Rodman was the

                                                37
       The court issued the following order denying defendants' motion: "The Motion of

Defendant Blake for [MP] Accounting and for Preparation of [MP] Taxes in Compliance

With Trial Verdict, is denied. The issue raised is a matter between the parties and the IRS."

Thus, although the court expressed the view in its verdict that the tax benefits from

Blake/Sharlana's improvements should have gone entirely to Blake/Sharlana instead of to

MP to be realized equally by Rodman and Blake, the court ultimately determined it was not

feasible to put a monetary value on the tax benefits Blake would have realized if she or

Sharlana, rather than MP or Rodman, had taken all of the depreciation benefits on tax returns

over the years of MP's existence. Based on Brinig's testimony and Rodman's opposition to

defendants' "tax treatment" motion, the court reasonably decided that the tax reallocation

referenced in its verdict was not reasonably susceptible of resolution through the judicial

accounting. Accordingly, the court did not err in omitting tax benefit reallocation from the

final judgment.




only party that would have benefitted from the deduction, that Mr. Rodman received 100%
of the deduction."
        Rodman stated in his opposing declaration: "From 2001 forward, I was told by Ms.
Blake that she would not and could not benefit annually from the tax losses or depreciation
because of her individual tax status. I did not have personal knowledge of her precise
personal tax plans or any information regarding her personal tax returns, other than her
telling me that in certain years she had not filed her personal returns. Accordingly, it was
agreed between Ms. Blake and me that until Ms. Blake could actually benefit from the
depreciation or tax losses, I would receive the tax losses."

                                              38
       D. Rodman's withdrawal of $70,000 from escrow.

       Defendants complain that the judgment fails to make factual findings about the

$70,000 Rodman withdrew from an escrow account after he arranged for MP to purchase the

property with the $1 million loan. The court in its verdict found that the parties' original deal

was for Rodman to purchase three acres of the property for $375,000, and that Rodman

deposited $75,000 in escrow with the intent to obtain a loan for the remaining $300,000.

The court found Rodman later withdrew $70,000 from the escrow account. Regarding that

withdrawal, the court stated: "[Rodman's] explanation [of the withdrawal] was not credible,

and there was no documented notice to Blake. However, Blake's testimony that she never

knew it was gone until the present litigation was not very persuasive either."

       When asked at trial why he withdrew most of his $75,000 deposit from escrow,

Rodman answered, "Because it was not needed to be there because of the way the financing

worked out." During the July 14, 2011 hearing, the court referred to Rodman's $75,000

escrow deposit as follows: "I found there to be a million dollar loan, even though clearly

when we tried the case, the amount of the loan was 75,000 [sic].[14] So the $75,000 issue is

gone. The $300,000 issue is gone. There's a million dollar loan. It's split 70/30. That's the

intent of the Court." Thus, the court impliedly found, in accordance with Rodman's

testimony, that Rodman was entitled to withdraw his $75,000 from escrow because the terms

of the parties' deal had changed and it was no longer needed under the new agreement,



14     The court presumably meant to refer to the $300,000 loan Rodman tried to obtain to
cover the remainder of the $375,000 purchase price for the upper three acres of the property
under the parties' original deal.

                                               39
whereby $300,000 of the $1 million loan used for MP's purchase of the property covered

Rodman's acquisition of the property's upper three acres. It was not reversible error to omit

an express finding to that effect in the judgment.

       E. Blake's breach of fiduciary duty claim

       Defendants contend the court failed to make necessary findings on Blake's cause of

action against Rodman for breach of fiduciary duty. Defendants acknowledge that the court

found Rodman was not a fiduciary to Blake when they entered into their business

relationship, "but became one once they agreed to be in business together." However, they

argue the court should have made findings on whether Rodman breached his fiduciary duties

to Blake after they entered into the OA. In support of the judgment, we imply the finding

that none of Rodman's conduct after he and Blake formed MP amounted to a breach of

fiduciary duty.

       Having expressly found that Rodman was a fiduciary to Blake after they entered into

the OA, the court's failure to address whether Rodman breached his fiduciary duties implies

that the court found there was no breach after the parties formed MP. In their opening brief,

defendants contend Rodman breached his fiduciary duties to Blake by the following conduct:

(1) deceiving Blake as to the fate of the $70,000 he secretly withdrew from escrow; (2) using

Blake's mortgage payments to pay down the loan but crediting them toward his own

mortgage obligation and expenses; (3) creating on MP's books his $300,000 loan obligation

to MP and crediting his payment of MP expenses toward that obligation; (4) paying Elliot's

attorney fees through MP's account; and (5) taking for himself the tax benefits from the

depreciation of Blake/Sharlana's improvements on the property without Blake's knowledge


                                              40
or consent. We have discussed all of this conduct above and are satisfied that the court

could reasonably find none of it constitutes a breach of fiduciary duty.

         There was evidence that Rodman's withdrawal of $70,000 from escrow was proper in

light of the parties' ultimate financing arrangement and that Blake was aware of the

withdrawal, as the court suggested in its verdict. As we discussed above, Brinig in the

accounting improperly credited portions of Blake's lease mortgage payments toward MP's

expenses and Rodman's share of the mortgage contrary to the express directive of the verdict

and judgment, but did so with the court's erroneous approval, not because of any breach of

fiduciary duty on Rodman's part. Nor was it a breach of fiduciary duty for MP's books to

reflect Rodman's $300,000 mortgage obligation. The extent to which Rodman's payments

into MP's account are properly credited toward his mortgage obligation as opposed to MP's

expenses is an accounting issue to be decided on remand.

         Regarding MP's payment of Elliot's attorney fees, the trial court heard testimony from

both Rodman and Blake on that issue and ruled that legal expenses, which consisted largely

of Elliot's fees, were to be divided equally. Finally, as discussed above, the omission of the

tax benefit issue from the judgment was reasonable because, among other reasons, it is

unclear that Blake suffered any harm as a result of Rodman's taking the deductions in

question for himself or MP, and there was evidence that he did so with Blake's knowledge

and consent. The court impliedly and reasonably found that Rodman's taking the

depreciation deductions was not a breach of fiduciary duty. The judgment's failure to

include express findings on whether Rodman breached his fiduciary duties is not reversible

error.


                                               41
               V. Denial of Defendant' Motion for Subdivision Cost Allocation

       The verdict and final judgment state: "The future costs associated with the division of

the property [into] separate parcels shall be borne by the parties equally, with the Court

maintaining jurisdiction to allocate them at a later time." Around the time the court entered

the final judgment, defendants filed a "Motion for Court Order for Subdivision Cost

Allocation," seeking a different allocation of subdivision costs from the equal allocation

ordered in the judgment. Specifically, defendants requested an order that Blake would not be

required to pay a share of certain mitigation and construction costs included in an estimate of

the subdivision costs. The court denied defendants' motion on February 17, 2012.

Defendants contend the court abused its discretion by denying the motion. Rodman contends

that the order denying defendants' motion is not an appealable postjudgment order. We

disagree with both contentions.

       There are two requirements a postjudgment order must satisfy to be appealable. "The

first requirement . . . is that the issues raised by the appeal from the order must be different

from those arising from an appeal from the judgment. [Citation.] 'The reason for this

general rule is that to allow the appeal from [an order raising the same issues as those raised

by the judgment] would have the effect of allowing two appeals from the same ruling and

might in some cases permit circumvention of the time limitations for appealing from the

judgment.' [Citation.] . . . [¶] The second requirement . . . is that 'the order must either affect

the judgment or relate to it by enforcing it or staying its execution.' " (Lakin v. Watkins

Associated Industries (1993) 6 Cal.4th 644, 651-652.)




                                                42
       The postjudgment order denying defendants' motion for allocation of subdivision

costs clearly affects and relates to the judgment because the judgment specifically reserved

the court's jurisdiction to reallocate those costs. Any order ultimately setting the allocation

of subdivision costs—either by leaving them allocated equally or ordering a different

allocation—is an order enforcing the provision in the judgment that allocates those costs.

Accordingly, the order denying defendants' motion for allocation of subdivision costs is an

appealable postjudgment order under Lakin.

       Defendants have not met their burden of showing that the court's denial of their

motion was an abuse of discretion. The court reserved jurisdiction to reallocate the

subdivision costs; it did not promise to reallocate them as defendants state in their opening

brief. The court's reservation of jurisdiction dates back to the verdict it issued in March

2010. The court's order from the July 14, 2011 hearing reiterated that "costs associated with

the subdivision are 50/50[.]" At that hearing the court actually ordered the property sold, but

stayed that order and warned that "if either party now stops this [subdivision] process, the

court will have the ability to remove the stay of that order, and it would go into effect

immediately. I don't want to do that. I really don't. But I have reached the level of

frustration with the process where I think that is where we're headed." The court did not

articulate its reasons for denying defendants' request for reallocation in February 2012. It

may be that the court decided to leave the allocation at 50/50 because it continued to be

frustrated by the parties' protracted and highly contentious disputes over the accounting and

subdivision. Whatever the court's reason, there is no basis for us to conclude its decision

exceeded the bounds of reason.


                                               43
                           VI. Denial of Motions for Attorney Fees

       As noted above, defendants and Rodman both filed motions for attorney fees on the

ground they were prevailing parties under Code of Civil Procedure sections 1032 and 1717.

The court denied both motions, determining "there was no prevailing party in this action, as

the results were mixed and did not constitute an unqualified win for either side." In light of

our decision to reverse the judgment in part and remand for further proceedings that will

change the parties' financial obligations under the judgment, we also reverse the trial court's

ruling on attorney fees and remand the matter for a new prevailing party determination.

(See, Ghirardo v. Antonioli (1994) 8 Cal.4th 791 808-809 [reversing damages award and

remanding for reconsideration of prevailing party issue]; Zagami, Inc. v. James A. Crone,

Inc. (2008) 160 Cal.App.4th 1083, 1097 [same]; Cisneros v. U.D. Registry, Inc. (1995) 39

Cal.App.4th 548, 576-577 [same].)

                                        DISPOSITION

       The portions of the judgment adopting the judicial accounting's findings regarding the

amounts the parties owe on their respective obligations on the mortgage loan and the amount

each contributed to MP's expenses are reversed. The trial court is directed to modify the

accounting and judgment by applying the entirety of Blake's mortgage/lease payments to her

share of the mortgage loan and recalculating the parties' remaining obligations on the

mortgage loan, contributions to MP's expenses, and amounts owing on unreimbursed

expenses accordingly. The order denying the parties' motions for attorney fees is reversed.

The court is directed to reconsider whether there is a prevailing party entitled to attorney fees

in light of the changes to the judgment and, if so, determine the amount of fees to be


                                               44
awarded. The order denying defendants' motion for allocation of subdivision costs is

affirmed. The parties shall bear their own costs on appeal.



                                                                       McCONNELL, P. J.

WE CONCUR:


BENKE, J.


HALLER, J.




                                             45
