De La Torre

Community Property

Not planning to Marry Marvin Agreements

In Contemplation of Marriage Ante – Nuptial Agreements

Change of Ownership in Marriage Transmutation

Contracts Between Divorcing Spouses Marital Settlement Agreement

I. Nonmarital Cohabitation
a. Unmarried cohabitants can contract with each other regarding property and support.
i. 1) the Family Law Act does not govern property between two nonmarried
people
ii. 2) courts should enforce express contracts except if it involved consideration
in the form of sexual services
iii. 3) in absence of a contract, courts should inquire about the conduct of the
parties to determine whether that conduct demonstrates an implied contract,
partnership, or other understanding. Quantum merit may be employed, a
reasonable sum of money to be paid for services rendered or work done when
the amount due is not stipulated in a legally enforceable contract.
b. Oral agreements between nonmarital partners are not subject to the statute of frauds
i. Courts may inquire into the conduct of the parties to determine whether that
conduct demonstrates an implied contract or implied agreement of partnership
or joint venture
1. Marvin v. Marvin 1976
c. In a Marvin agreement, a couple can contract regarding how property is owned. The
contract may detail whether earnings are considered property of the earner or the
couple. The couple may craft a pooling agreement or create support obligations.
d. Remedies between divorcing spouses
i. Alimony
ii. Property distribution
iii. In quantum merit
e. Recover
i. In quantum meruit
1. Reasonable value of household services rendered minus the value of
support received if he can show that he rendered services with the
expectation of monetary reward
ii. Contract law – express or implied
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1. contracts may be implied by the parties’ conduct.

iii. Restitution – equitable theory
1. If one party provides value to another, reasonably expecting equivalent
return, then that value is recoverable even without a contract
a. Value of domestic services provided during the relationship to
receive similar relief granted to married couples
b. As an equitable matter, a constructive trust might be warranted
iv. Cannot just pay, must show substantive right
1. Rule Marvin Action
a. If P establishes a need and the D is able to pay, not a reason to
award money to P. Court may not create a new substantive
right under the guise of doing equity
2. Spousal support only appropriate if there is an existing substantive
right and court said new right cannot be created
3. An award of support intended to make whole a party who acted in
reliance upon his or her understanding of the terms of a cohabitating
romantic relationship is not an appropriate equitable remedy. Rather,
equitable remedies are intended to protect the understandings of both
parties to a relationship
a. Marvin v. Marvin 1981
i. Michelle had been placed in a better financial position
as a result of her relationship with Lee than she would
have been in had she not been in the relationship but
had continued her normal earnings as a dancer. The
decision of the trial court to award $104,000.00 in
support for Michelle's economic rehabilitation is
reversed.
v. Rule
1. 1) An award of support intended to make whole a party who acted in
reliance upon his or her understanding of the terms of a cohabitating
romantic relationship is not an appropriate equitable remedy.
2. (2) Nonmarital cohabitation does not confer any rights, in equity or
law, for economic remedies upon the termination of the relationship.
f. §6.05 Allocation of Domestic-Partnership Property
i. Domestic-Partnership Property should be divided according to the principles
set forth in the division of marital property
g. §6.06 Compensatory Payments
i. Except as otherwise provided
1. A) a domestic partner is entitled to compensatory payments on the
same basis as a spouse and
2. B) wherever a rule implementing a compensatory payment principle
makes the duration of the marriage a relevant factor, the application of
that principle should employ the duration of the domestic partnership
period
II. Pre-Marital Contracts

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a. FC § 1611, § 1612, § 1615

b. FC § 1610(a) an agreement between prospective spouses made in contemplation of
marriage and to be effective upon marriage. It is considered a contract and normal
contract rules apply
i. Proof of fraud, constructive fraud, duress, or undue influence, the contract is
unenforceable
c. Duty
i. Parties negotiating a premarital agreement are not presumed to be in a
confidential relationship that would give rise to a fiduciary duty owed
between spouses or to the presumption of undue influence when a transaction
benefits one of the parties
d. Formalities
i. FC § 1611 Premarital agreement shall be in writing and signed by both
parties. Enforceable without consideration
1. Life insurance
a. Under CP law, an oral antenuptial agreement related to the
proceeds of life insurance is enforceable if there has been full
performance of the terms of the agreement by both parties
i. Freitas v. Freitas 1916
1. Parties themselves cannot testify because then it
would be self-serving testimony and would need
a 3rd party to recount the relevant parts of the
contract.
ii. Under CP law, estoppel can be raised as a successful
defense to the statute of frauds where a party to an oral
antenuptial agreement changed position in a detrimental
manner in reliance on the agreement
2. Performance & Estoppel
a. 1) An oral antenuptial agreement related to the proceeds of life
insurance is enforceable if there has been full performance of
the terms of the agreement by both parties.
b. Under the statute of frauds, an oral agreement made in
contemplation of marriage is not normally enforceable.
i. However, an exception to this rule exists where the
agreement has been fully executed.
c. Case Example
i. Here, there was an oral antenuptial agreement for Mrs.
Freitas to marry Mr. Freitas in exchange for becoming
the named beneficiary of his life-insurance policy. Mrs.
Freitas delivered on her promise by marrying Mr.
Freitas. By changing the beneficiary on his life-
insurance policy to Mrs. Freitas, Mr. Freitas delivered
on his promise and fully performed the terms of the
agreement. The benefit to Mrs. Freitas was taken away
only by subsequent fraud on the part of Mr. Freitas and

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did not serve to invalidate the terms of the underlying

agreement between the Freitases. Because there was
full performance of the terms of the agreement by both
Mr. and Mrs. Freitas, the agreement is enforceable.
Therefore, Mrs. Freitas is entitled to the life-insurance
proceeds.
d. 2) estoppel can be raised as a successful defense to the statute
of frauds where a party to an oral antenuptial agreement
changed position in a detrimental manner in reliance on the
agreement.
i. Case Example
1. Jury found that the decedent relied upon
husband’s oral promise not to share in her
estate to her detriment, she having forgone any
claim to her husband’s estate had she survived
him, having not commingled her assets with his
and having not changed her will
3. Analyze
a. Estoppel can be raised as a successful defense to the statute of
frauds where a party to an oral antenuptial agreement changed
position in a detrimental manner in reliance on the agreement.
The statute of frauds provides that an oral antenuptial
agreement is normally unenforceable. However, when a party
changes position to his or her detriment in reliance upon
the agreement, this reliance serves as a successful defense to
the statute of frauds. Specifically, when facts exist that
operate as a defense to the statute of frauds as a matter of law,
the party who is asserting the statute of frauds is estopped from
making that assertion, and the oral agreement can be
enforceable.
1. Here, in reliance on the agreement, Florence
changed her position to her detriment by
giving up her claim to Al’s estate as a
surviving spouse. If Florence had either not
made the agreement or not married Al, Florence
would have been in a better position as a
surviving spouse than she could have been
under the present oral antenuptial agreement.
Section 220 of the Probate Code provides that a
marital contract, including an antenuptial
contract, takes precedence over the default rules
of intestate inheritance. Thus, section 220 does
not limit the defenses that can be raised to a
statute-of-frauds claim. Here, because Florence
changed her position in detrimental reliance on

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the oral antenuptial agreement between herself

and Al, estoppel is a permissible defense to the
Petersons’ statute-of-frauds claim regarding the
agreement. Accordingly, the judgment of the
trial court is affirmed.
I. Estate of Sheldon
b. Exception to statute of frauds
i. When justice requires it
ii. If one party performs his side of the agreement a court
will enforce the agreement
iii. Also if spouse relied to his detriment – marriage itself is
not a sufficient basis to enforce a premarital agreement
4. Safe harbor provision
a. Raises a presumption that consent was informed and not
obtained under duress when the party seeking enforcement
shows:
i. 1) The agreement was executed at least 30 days before
the marriage;
ii. 2) both parties were advised to obtain independent legal
counsel and had reasonable opportunity to do so before
the agreements execution;
iii. 3) agreements without independent legal counsel, the
agreement must state in language easily understandable
by an adult with no legal training
1. A) the nature of any rights or claims otherwise
arising at dissolution that are altered by the
contract and the nature of the alteration; and
2. B) that the interests of the souses, with respect
to the agreement may be adverse
I. SECTION 7.04
5. Second look provision:
a. Section 7.05 subjects’ agreements to substantive review at
dissolution only in certain types of marriages:
i. 1) long marriages
ii. 2) marriages in which the circumstances of the parties
have significantly changed in ways unforeseeable when
the agreement was made
b. Party resisting enforcement
i. Bears the burden of demonstrating that enforcement of
a term of the agreement would work a substantial
injustice
e. Enforceable
i. An antenuptial agreement is valid if it 1) does not encourage or promote the
dissolution of the marriage and was 2) freely and voluntarily entered into. An
antenuptial agreement was not entered into to last until death

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1. An antenuptial agreement is not unenforceable merely because the

parties expressly intended their marriage will only be temporary
and not until death
f. Not Enforceable – Enforcement Provisions – Premarital Agreement
i. If parties didn’t execute voluntarily
ii. FC § 1615 voluntariness
1. (c) Not voluntary unless:
a. 1) party against whom enforcement is sought represented by
independent legal counsel at least 7 days; or
i. *** 7-day requirement does not apply when both
parties are represented by counsel
ii. Does not need representation on Jan 1, 2020 and
after
iii. Actual representation – adhere to the 7-day rule, makes
it more iron clad and beneficial to make sure there is 7
days of presentation and signing so that it is another
avenue that makes it enforceable
b. 2) the unrepresented party executes a document declaring she
received the information
2. Courts consider many factors to determine the voluntariness of a
premarital agreement, and no one factor is controlling. Several factors,
include: (1) how close the signing was to the wedding, (2) surprise, (3)
opportunity to seek independent counsel, (4) unequal bargaining
power, (5) disclosure of assets, and (6) understanding of the
agreement, (7) at least 7 days to sign the agreement before the
wedding.
3. Not voluntarily made unless
a. Court determines that certain procedural requirements were
met and the agreement was not executed under duress, fraud,
undue influence, incapacity, or any other taint
4. Analyze
a. whether or not the prenup is valid, goes through contractual
defenses and additional defenses that only applies to prenups
i. Invalidated the Marriage of Nogrey
1. Bc it was presented at the wedding bc it violates
7(j) rule
ii. Between Jan 1, 2002 – Jan 1, 2020 Teaches us that
both parties need to be represented
iii. Exceedingly important 2 competent attorneys in all
prenups and that everything is expressly included in
writing
iv. Every disclosure, foreseeable income, must be
complete, true and accurate depictions
v. In Re Marriage of Bonds 20009
1. Consider fairness now and in the future

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2. Both have to get a benefit

5. Burden of proof Family Code Section 1615
a. Places the burden upon the party challenging the voluntariness
of the agreement
b. Party seeking to enforce the premarital agreement must show
that the other party’s con sent to it was informed and not
obtained under duress
iii. Too substantial of a gift
1. An antenuptial agreement is not enforceable if the agreement
provides for a substantial gift or transfer of money or property from
one spouse to another in the event of a divorce
iv. Promotes divorce – contrary to public policy and unenforceable
1. Unless the $100,000 provision did not threaten the marriage,
relationship like in Bellio. It merely insured the wife was no worse off
at divorce than if she had remained single and retained her right to
alimony payments from previous marriage.
v. Agreement during marriage
1. Wife would take care of husband and wife would get property in
return. Made during marriage, H died and wife got nothing because of
pre-existing duty rule to take care of her husband therefore no
consideration
vi. Avoid premarital agreement
1. By establishing agreement was involuntary, lack of capacity, duress,
fraud, and undue influence is relative and probative in establishing the
involuntariness of the agreement
a. Uniform Premarital Agreement Act (UPAA)
2. Demonstrate lack of disclosure of assets
3. lack of waiver of disclosure
4. lack of imputed knowledge
vii. Unconscionability
1. Agreement was unconscionable and all of the following applied:
a. Party not provided fair and reasonable disclosure
b. Party did not voluntarily and expressly waive, in writing, any
right to disclosure of the property or financial obligations
beyond the disclosure provided
c. Party did not have, and could not have reasonably had adequate
knowledge of the property or financial obligations of the other
party
2. FC § 1615(a)(2) some unconscionable agreements are enforceable
a. If the disadvantage party was given fair, reasonable, and full
disclosures of the other party’s property, or waived the right to
disclosure and if the disadvantaged party signed voluntarily
g. Test: looking at the premarital contract
1. The test does not turn on the subjective contemplation of the parties
but upon objective language of the contract itself

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a. Can only succeed if not against public policy

b. Benefit bestowed upon both parties?
i. Ex receiving $100,000 but theoretically she would have
gotten spousal support from Husband A
c. What was the intent? Promote the divorce?
h. Effective
i. Upon marriage – executed when signed and enforced at dissolution of the
marriage
i. Effect of void marriage
i. If marriage is determined to be void, an agreement that would otherwise have
been a premarital agreement is enforceable only to the extent necessary to
avoid an inequitable result
j. Limitations of actions
i. Statute of limitations applicable to an action asserting a claim for relief under
a premarital agreement is tolled during the marriage of the parties to the
agreement.
ii. Equitable defenses limiting the time for enforcement, including laches and
estoppel are available to either party
k. What you can contract about FC § 1612

i. (a) Parties to a premarital agreement may contract with respect to all of the

following:
ii. (1) The rights and obligations of each of the parties in any of the property
of either or both of them whenever and wherever acquired or located.
iii. (2) The right to buy, sell, use, transfer, exchange, abandon, lease, consume,
expend, assign, create a security interest in, mortgage, encumber, dispose of,
or otherwise manage and control property.
iv. (3) The disposition of property upon separation, marital dissolution, death, or
the occurrence or nonoccurrence of any other event.
v. (4) The making of a will, trust, or other arrangement to carry out the
provisions of the agreement.
vi. (5) The ownership rights in and disposition of the death benefit from a life
insurance policy.
vii. (6) The choice of law governing the construction of the agreement.
viii. (7) Any other matter, including their personal rights and obligations, not in
violation of public policy or a statute imposing a criminal penalty.
ix. (b) The right of a child to support may not be adversely affected by a
premarital agreement.
1. Cannot contract to the right of a child to support may not be adversely
affected by premarital agreement
a. Cannot contract your child support away
l. Waiver of Spousal Support FC § 1612 (c) – holds that a waiver of spousal support
is enforceable only if the waiving spouse is represented by counsel

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i. a premarital contract term concerning spousal support is unenforceable if the

party resisting enforcement was not represented by independent counsel, or
the provision is unconscionable at the time of enforcement

1. (A) Agreement between January 1, 2002 and January 1, 2020, the

party against whom enforcement is sought has 7 days from the time
they are first presented with the agreement and are 2) advised to seek
independent legal counsel
a. If you are trying to get a spousal support wavier
i. Would be payor and would be payee need to be
separately represented and need to understand the
consequences of their decisions
1. Drafting attorney needs to explain thoroughly
what they mean

2. (B) For an agreement executed on or after January 1, 2020, the party

against whom enforcement is sought has 7 days to be presented with
the agreement before the wedding, no counsel required
m. FC § 1614 – amendments and revocations
i. A premarital agreement may be amended or revoked only by which
written agreement signed by the parties. The amended agreement or
revocation is enforceable without consideration
a. Have the ability to contract away a prenuptial agreement or
make a post nuptial agreement
2. California is a second look jurisdiction
a. Look at the time of construction
b. Look at the time of enforcement
i. Look to see if its unfair if applied today
1. “a spousal support waiver will be enforceable if
a party becomes full unable to take care of
themselves or is disabled during the marriage”
I. Need this clause.
III. Marital Property in the US
a. Characterization
i. The character of an asset is fixed at the time that it is originally acquired. The
point of acquisition is point at which the owner’s legal rights come into
existence
ii. FC § 760 All property, real or personal, wherever situated, acquired by a
married person during marriage prior to separation while domiciled in this
state is community property.
iii. General CP Presumption, anything produced by the time, effort, energy, or
skill of a married person is presumptively community property
1. When fee was earned, not when the fee was received.
b. Property

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i. FC 1620(b) Whether tangible or intangible, real or personal, vested or

contingent, the community property asset in question must be something
capable of being transferred.
c. Married Woman’s Property Acts
i. Regard the woman as the separate and individual owner of all property that
would have been hers but for the marriage
ii. Owns and control as all property that she brings to the marriage from
whatever source and all property that she acquires or earns during marriage
1. Prior to 1975 – community property legislation sought to mitigate
certain aspects of sexual inequality
a. Gave married woman control over her separate property,
expanded definition to include joint or unilateral control and
subjected community property to her joint or unilateral control
b. Husbands predominantly had control over property
i. Caused grief to the fiduciary duty
2. After 1975 – establishment of spouse as equal managers, and the
deterrence of spouses over reaching during marriage and at divorce
d. Marriage
i. FC § 300 A personal relationship, founded on love and trust, arising out of a
civil contract between two persons, to which the consent of the parties is
necessary
ii. Requires
1. Consent and capability of making a contract
e. Community Property FC § 760
i. Except as otherwise provided by statute, all property, real or personal,
wherever situated, acquired by a married person during the marriage wile
domiciled in this state is community property
ii. All property acquired by the labor of either spouse during marriage and is
shared equally from acquisition
1. FC § 751 states the respective interests of each spouse in CP during
the continuance of the marriage are present, existing, and equal
interests.
a. Either spouse acting alone may manage the community
property, but both spouses must join together for certain events
such as gifts and real property transactions
iii. CP Presumption
1. Property acquired by the joint efforts of the husband and wife is
presumed to be community property
a. Assumes joint ownership unless a spouse demonstrates
otherwise either by showing that the property is by definition
separate or that the spouses explicitly agree to a separate
classification
f. FC § 125 Quasi-Community Property
i. all real or personal property, wherever situated, acquired before or after the
operative date of this code by 1) By either spouse while domiciled in another

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state which would have been community property if the spouse who acquired
the property had been domiciled in this state at the time of its acquisition or 2)
In exchange for real or personal property, which would have been community
property if the spouse who acquired the property so exchanged had been
domiciled in this state at the time of its acquisition.
ii. Depends where the spouse was living when the property was acquired. If the
spouse:
1. Living in Ca, FC § 760
a. and the property is CP.
2. Living Outside of Ca § 125
a. Property is quasi-community – both spouses must live in CA
for Quasi-CP

For property related issues I have the following:

- Commingled funds
- Property acquired with separate and CP funds (Lucas
- transmutation
- credit acquisitions
- CP funds use towards Separate property
- business profits/ growth
- improvements to separate
property

or

- state basic rules and presumptions

- state/analyze when CP started and ended

- go into analysis of each item at issue:

- source: time and source of funds
- issue that may change character of property
- distribution
- any issues that preempt traditional distribution (misappropriation, breach of fid
duty)

a. - CP paying off purchase price of separate

property
g. Separate Property FC § 770
i. All property owned before marriage and all property acquired by a spouse
during marriage by gift, bequest, devise, or descent with the rents, issues and
profits thereof, is his separate property
1. Property that a spouse acquired before the marriage is community
property unless it is
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a. 1) traceable to a separate property source

b. 2) acquired by gift or bequest; or
c. 3) earned or accumulated while the spouses are living separate
and apart
d. *** A spouses claim that property acquired during a marriage
is separate property must be proven by preponderance of the
evidence
i. A spouse asserting that property acquired by purchase
during a marriage is separate property must prove that
the property is not community
ii. A married person may, without the consent of the person’s spouse, convey the
person’s separate property
1. §771 The earnings and accumulations of a spouse and the minor
children living with, or in the custody of, the spouse, while living
separate and apart from the other spouse, are the separate property
of the spouse (Downer v. Bramet)
a. If you can prove that they earned while living apart, but before
divorce is finalized, this is sperate property
i. Look to why they are receiving it
1. Separate property if payment is received after
separation
2. Presumption only controlling when it is impossible to trace the source
of the specific property
h. The End of the Economic Community
i. If marriage ends with death, community ceases at the time of death, the
surviving continues to own his/her interest in the CP property and the
decedent’s property passes by will or intestacy
ii. § 771 earnings and accumulation of the spouse, after the date of separation
of the spouses are the separate property of the spouse
1. ****That condition when spouses have come to a parting of the ways
with no present intention of resuming marital relations***
iii. Davis Applies - Creates an island from January 2015- 2017 Marriage of
Davis if dissolution was filed during that time
1. If parties separated and filed for divorce, Marriage of Davis apply,
therefore there would not be a date of separation until the two parties
moved out of the same home
a. Marriage of Davis 2015 NOT GOOD LAW
iv. Date of Separation Determined by FC § 70 enacted after Davis
1. It is clear that the legislature intended the phrase “date of separation”
to mean
a. 1) the spouse has expressed top the other spouse his or her
intent to end the marriage
b. 2) the conduct of the spouse is consistent with his or her intent
to end the marriage

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2. In determining the date of separation, court should take into account

all relevant evidence with totality of the circumstances
3. Analyze
a. Date of separation has many financial implications.
IV. Gifts & Classification
a. A spouse cannot give away community personal or real property without the written
consent of the other spouse § 1100(b). A non-consenting spouse can set aside an
unauthorized gift in its entirety during the lifetime of the donor spouse. If the donor
spouse has died, one-half of the unauthorized gift may be set aside.
b. A gift between spouses usually requires a writing. However, the writing requirement
does not apply to a gift between the spouses of clothing, wearing apparel, jewelry or
other tangible articles of personal nature that is used solely or principally by the
spouse to whom the gift is made and is not substantial in value taking into account the
circumstances of the marriage.
c. Rule gift for services rendered: Remunerative (lucrative, financially rewarding)
gifts made by a donor to show appreciation for services rendered, are community
property on the theory that they emanate from the spouse’s labor.
i. Wife contends that there is substantial evidence that the transfer of the ranch’s
interest was in lieu of pension benefits and is therefore community property.
A gift is a transfer of personal property, made voluntarily, and without
consideration (separate property). Although the ranch was a gift, there is
strong evidence to show that the gift was a remuneratory gift in recognition of
husband’s loyal and skilled efforts for the services to his employer. To an
extent, it can be seen that the efforts and services were rendered during the
marriage, therefore the proceeds of the ranch sale were community property.
1. He had worked there for YEARS
2. Look to family relationship
3. Had it been a separate property vs transfer of interest in lieu of benefits
(pension)
a. Downer v. Bramet
d. When analyzing Gifts
i. Look to:
1. 1) Significance of evidence at the time of the trial
2. 2) Personal or social relationship
a. example son or nephew
b. helps understand why this gift was given
3. 3) recognition for a job well done?
4. 4) If it is his uncle/employer, it could have been recognition for his
work and also could be because of family layers
e. Onerous title
i. Gave something, in exchange and becomes community property
1. Labor and industry in a partnership
2. Acquired for valuable consideration, money earned during marriage,
fruits and labor during the partnership

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3. Property acquired by husband and wife during the marriage through

their labor or industry or other valuable consideration
f. Lucrative title
i. Property Acquired through gift, succession, inheritance, or the like
1. Property received for doing nothing
2. Can be community or separate
a. Look at intent
ii. Rule: Property acquired by compromise is separate property if the right
compromised is sperate
1. In Estate of Clark
iii. Acquired property right/ inheritance right
a. He worked for it, separate property right to contest the will,
through the laws of intestacy, entitled to
b. Community never had an interest in the son’s estate but Major
Clark had a property right as separate property
g. § 1211
i. No person offered as a witness shall be excluded from giving evidence by
reason of his interest in an action but if a person who is called as a witness
has an interest, they may not testify bc of credibility
1. if property is community property, then the interested party can not
testify (wife of son who nursed back Mom from health).
2. If there is no element of gift, bequest, or devise then look to alleged
agreement
a. Decedent willed his property to his son for consideration and
that consideration was to maintain and support him during the
rest of his life. Andrews v. Andrews
V. Tracing
a. Contributions by married persons to a joint account are presumed to be CP. The CP
presumption established by §
b. Direct tracing
i. Separate funds do not lose their character as such when comingled with
community funds in a bank account so long as the amount thereof can be
ascertained. Direct tracing requires specific records reconstructing each SP
and CP deposit and each separate and CP payment or withdrawal as it occurs
1. The spouse seeking to prove money withdrawn from a commingled
account was separate property proves:
a. 1) sat the moment the withdrawal was made; sufficient separate
funds were available in the account to cover the withdrawal;
and
b. 2) the spouse intended to withdraw separate funds
c. Indirect tracing - messy
i. Consideration of family expenses – exhaustion
1. Looks to unavailability of CP on that date
2. Presumption that family expenses, routine costs of maintaining a
household and family, are paid from community funds

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3. If at the time of the acquisition of the property in dispute, it can be

shown that all community income in the comingled account has been
exhausted by family expenses, then all the funds remaining in the
account at the time the property was purchased were necessarily
separate funds. When family expenses are paid with SP, there is no
right to reimbursement of the SP unless the parties agreed to
reimbursement.
4. Rule
a. The family expense presumption: The value of community
labor during marriage must be reduced by family expenses
ii. Recapitulation – cannot apply to indirect tracing
1. Aggregates transactions over a period of time
2. State every expense that you have ever had as a couple that is
considered community and then calculate the total amount of CP funds
that have come in and then subtract that from the funds available to
prove that the purchase can only have happened if there was separate
property bc through recapitulation the property would not have been
able to been bought without the separate property ****
a. Calculate the total amount of CP funds that have come in
b. Subtract that from the funds available
c. Show that without the SP funds, the purchase would not have
been made
iii. Tracing analysis must as a prerequisite, require resort to time-specific,
nonrecuperative accounting practices
iv. Test
1. When separate funds deposited with community funds continue to be
on deposit when the withdrawal is made and it is the intention of the
drawer to withdraw separate funds, specifically, the separate property
status of the withdrawn funds is established
a. Need sufficient evidence to demonstrate intent to use only
separate property funds to make loan payments
b. What other expenditures were expended?
c. Nature of the funds used
d. Character of the capital investment
e. The time in which they were expended
d. Commingling
i. Rule
1. One must establish a clear picture of the account in order for it to be
enough to overcome the presumption that cp was used when talking
about a comingled account. Adequate record keeping
a. Marriage of Frick 1986
ii. Helps highlight any comingling that occurred
iii. Rule – Presumption of Comingling
1. If funds used for acquisitions during marriage cannot otherwise be
traced to their resource and the husband who has comingled property

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 De La Torre

is unable to establish that there was a deficit in the community

accounts when the assets were purchased, the presumption controls
that property acquired by purchase during marriage is community
property
2. Marriage of Mix 1975
a. Adequately trace the source of the funds withdrawn from the
comingled bank accounts for use in connection with the
aforementioned properties to her separate funds
b. If the property, or the source of funds with which it is acquired,
can be traced, its separate property character remains
unchanged, but if the separate and CP or funds are comingled
in such a manner that is impossible to trace the source of the
property or funds, the whole will be treated as community
property
i. Patterson v. Patterson 1966
e. Character of Property – Analyze
i. The characterization of property is determined at the time of acquisition. If
it is community property when acquired, it remains so throughout the
marriage unless the spouses agree to change its nature or the spouse charged
with its management makes a gift of it to the other. Property acquired by
purchasing during a marriage is presumed to be community property, and the
burden is on the spouse asserting its separate property character to overcome
the presumption. The presumption applies when a husband purchases property
during their marriage with funds from an undisclosed or disputed source such
as an account or fund in which he has comingled his separate funds with
community funds. He may trace the source of the property to his separate
funds and overcome the presumption with evidence that community expenses
exceeded community income at the time of the acquisition. Tracing plays a
pivotal role in characterization. Tracing involves discovering what money
paid for an item of property or where the source of the funds come from. It
helps trace transactions and used to identify separate property as separate and
identify community property that is community by showing he acquired the
option before marriage. Helps highlight any comingling that occurred
1. There must be adequate records to invoke the burden of record
keeping as a justification for a recapitulation of income and expenses
at the termination of the marriage that disregarded acquisitions that
may have been made during the marriage with CP funds
2. If funds cannot be traced and husband can’t establish deficit in the
community accounts, then presumption is property acquired during
marriage is CP
3. The H can protect his property by not commingling separate assets
and income *****
ii. Once a person commingles, he assumes the burden of keeping records
adequate to establish the balance of community income and expenditures
at the time an asset is acquired with comingled property

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1. Burden of tracing sources

VI. Separate Property Contributions to the purchase Price of Joint Titled Property
a. Pro Rata Apportionment
i. When separate and community funds contribute to the acquisition of property,
the property is normally part community property and part separate. FC §
2640 allows the SP contributor to be reimbursed the SP he used for the CP
ii. What to look too – Characterization of the item is tied to the relative
contributions of separate and community property the purchase
1. Title
2. Source of funds

iii. FC § 2640 Reimbursement of SP contribution to CP – see FC § 2581

1. If property is taken in joint form, the property is presumed to be 100%

CP, even if used a combination of SP and CP

iv. (a) “Contributions to the acquisition of * * * property,” as used in this

section, include down payments, payments for improvements, and payments
that reduce the principal of a loan used to finance the purchase or
improvement of the property but do not include payments of interest on the
loan or payments made for maintenance, insurance, or taxation of the
property.

1. Reimbursement for improvements

v. (b) In the division of the community estate under this division, unless a party
has made a written waiver of the right to reimbursement or has signed a
writing that has the effect of a waiver, the party shall be reimbursed for the
party's contributions to the acquisition of property of the community property
estate to the extent the party traces the contributions to a separate property
source.  The amount reimbursed shall be without interest or adjustment for
change in monetary values and may not exceed the net value of the property at
the time of the division.

1. Community estate is CP and QCP

2. Right to reimbursement may be waived in writing oral ineffective

3. Amount without interest

vi. (c) A party shall be reimbursed for the party's separate property contributions
to the acquisition of property of the other spouse's separate property estate
during the marriage, unless there has been a transmutation in writing pursuant
to Chapter 5 (commencing with Section 850 ) of Part 2 of Division 4, or a
written waiver of the right to reimbursement.  The amount reimbursed shall
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be without interest or adjustment for change in monetary values and may not
exceed the net value of the property at the time of the division.

1. If the presumption holds the house is 100% CP, if the Wife can trace
to her SP, she is entitled to reimbursement of her down payment

b. Improvements

i. Spending money to improve land or add fixtures generally does not acquire an
ownership interest in the land. One acquires ownership interest by paying the
mortgage, not by adding an improvement

1. One spouse uses SP to improve other spouse’s SP

a. Prior to 1/1/2005, no right of reimbursement

b. Improving Spouses entitled to reimbursement

i. FC § 2460(c)

2. One spouse uses CP to improve other spouses SP

a. Wolf disliked traditional rule, found no logical basis for

denying a spouse reimbursement for a community funded
improvement to the other spouse’s separate property.

b. Community is reimbursed ½ the cost of improvement

3. One spouse uses CP to improve his own SP

a. If other spouse agrees, no problem. This amounts to a

transmutation and should the writing requirement satisfy FC
§ 852(b)

b. If there is no agreement

i. Reimbursement to the community

ii. Reimbursement is the amount of community funds

expended or the increased value due to the
improvement, whichever is greater

4. One spouse uses SP to improve CP

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a. FC § 2640 requires reimbursement of the separate property if

after January 1, 1984

5. One spouse uses SP to improve his own SP

a. a married person can do what they like with their separate

property
c. Lucas Gift Presumption
i. When a spouse uses separate property to buy community property, that spouse
intended to give the separate property to the community and could not, in a
divorce, seek reimbursement of the separate property.
ii. Presumption – Marriage of Lucas
1. While the parties are living together, it is presumed that, unless an
agreement between the parties specifies that the contributing party be
reimbursed, a party who utilizes his separate property for community
purposes intends a gift to the community
2. Ex
a. If no separate understanding that Brenda’s separate interest
should be maintained, but no separate understanding with
respect to improvements, Brenda should receive no additional
credit for her expenditure for improvements, for it may be
presumed that she intended that they redound to both the
community and her separate property interest
i. Marriage of Lucas 1980
1. Absent an agreement, the wife was entitled to
nothing
iii. Ends
1. January 1, 1984, with the enactment of § 2640 – anti lucas legislation
2. Lucas gift presumption applies to separate property contributions to
CP prior to January 1, 1984, unless there was an oral or written
agreement that a gift was not intended
d. Presumption
i. Single family residence of husband and wife is acquired during marriage by
them, presumption is that the residence is community property Civil Code §
5110
e. Creates marked distinction between property explicitly designed as joint tenancy or
community property in written title and a property acquired during marriage for
which there is
i. 1) no written title (agreement required); or
1. Need agreement for Lucas – oral suffices
ii. 2) for which title is not in a joint and equal ownership (tracing purchase funds
1. No interest or adjustment for change in monetary values, cannot
exceed the net value
a. Include

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 De La Torre

i. Down payment, payment for improvements, and

payment used to reduce the principle of the loan
b. Do not include
i. Interest on the loan, payments made for maintenance,
insurance or taxation of the property
2. Removed the gift presumption, no matter if the person gave a portion
of the down payment, paid mortgage from their separate property that
they were automatically gifting it to the community
a. If they can prove they made a separate property contribution
they are entitled to reimbursement unless there is a writing
that suggests that this was not the agreement of the parties
3. Anti – Lucas only applies from 1984 forward – cannot be applied
retroactively
a. Prior to 1984 apply Marriage of Lucas
f. What I need to know

Joint title Community Title in untitled

property buyer’s name
alone

Communit Community Communit Community

y property property y property property
presumption presumption presumption presumption
unless unless unless unless

Pre-1983: Pre-1987: Simple Simple

Pre-1983: No Oral agreement/ Tracing Tracing
writing understanding demonstrated demonstrated
Sufficient

After 1983: After 1987:

Writing Writing
required Required

i. Before 1984:
1. Denied reimbursement
2. Seen as a gift
ii. After January 1, 1984
1. Right to separate property reimbursement unless agree in writing to
waive reimbursement
iii. Policy
1. In the interest of finality, uniformity, and predictability, retroactivity of
marital property statutes should be reversed for those rare instances
when such disruption is necessary to promote a significantly important
state interest
iv. Dies before divorce
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 De La Torre

1. Divorce goes away and right of survivorship controls

2. Use date of purchase for property as date that is controlling
VII. Presumptions
a. California law employs presumptions to help characterize property as separate or
community.
b. Look to 3 things with presumptions
i. 1) when does the presumption apply?
ii. 2) what does the presumption do?
iii. 3) How is the presumption rebutted?
c. General Community Property Presumption
i. Real or personal property, acquired during marriage, and before separation, by
a married person, when domiciled in California, is presumed to be community
property.
1. FC § 760
2. Rebuttal
a. by tracing the source to separate property
3. The spouse seeking to invoke the presumption has the burden of
proving basic facts- the property was acquired during marriage, while
domiciled in Ca. Proof of these basic facts raises the CP presumption.
If the separatizer fails to carry the burden of proof, the presumption
stands, and the property is characterized as CP
ii. Rule
1. Property acquired by purchase during a marriage is presumed to be
community property and the burden is on the spouse who is asserting
its character to overcome the presumption
a. See v. See 1966
i. If you are arguing its CP, then all presumptions on your
side
ii. If you are asserting that it is separate property, then you
would assert the title presumption, the concept of
tracing, transmutations to further your argument and
prove it is separate property
1. Title does not mean it is theirs alone
iii. Analyze
1. The statutory presumption that property acquired after marriage except
by gift, bequest, devise, or descent is community property is
successfully rebutted by evidence that the property was taken in joint
tenancy
2. No discussion on how title should be taken but on paper said joint
tenancy but she assumed it belonged to both of them
3. ****The form of conveyance is itself evidence of the intent to change
it from community property and creates a rebuttable presumption. It is
not conclusive. A husband and wife may convert community property
into separate property and vice versa by agreement between
themselves. The presumption arising from the form of the deed may

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be controverted (dispute) by testimony indicating the intention,

understanding, or agreement of the parties
4. Although there is a legal presumption that property acquired after
marriage is community property, the written titling of a deed as a joint
tenancy overcomes that presumption and reflects a separate joint-
tenancy ownership. That specific titling can only be overcome by a
finding that the husband and wife had an agreement or mutual
understanding that the property was community property.
5. Here, Mrs. Schindler testified that she did not discuss the deed
language or the ownership of the property with Mr. Schindler. Mrs.
Schindler’s desire that the property be held as community property
was not revealed to Mr. Schindler. There was no evidence that Mr.
Schindler either knew of her intention or intended for the property to
be held as community property. Mr. and Mrs. Schindler did not have
an agreement to hold the property as community property. Therefore,
the joint-tenancy language of the deed controls, and the residence is
held as a joint tenancy. The judgment of the trial court is reversed.
a. Schindler v. Schindler 1954
iv. Rule – Avoiding Probate
1. The intent to avoid probate is not inconsistent with the intent to have
the property as community property. If both the wife and husband title
community property as joint tenants, the property is community if both
the wife and husband considered the property to be community and
only titled it to avoid probate
2. Real property held by a husband and wife as a joint tenancy for
the sole purpose of avoiding probate is considered community
property in divorce proceedings
a. The fact that the property was purchased with community
funds is insufficient to rebut the presumption by the form of the
deed
i. Bowman v. Bowman 1957
3. When property is titled as a joint tenancy, there is a rebuttable
presumption that the parties intended to hold the property as a joint
tenancy. That presumption can be rebutted by substantial evidence that
the parties had both intended and agreed to hold the property as
community property. Parol evidence of the statements and actions of
the parties can be used to show that both the husband and wife had this
intent. 
4. this case is distinguished from the case of Schindler v.
Schindler,  272 P.2d 566 (1954), because Mr. Bowman testified that
he wanted the marital property to have the characteristics of
community property and that he and his wife only took title as joint
tenants to avoid probate. There is substantial evidence to overcome
the rebuttable presumption of joint tenancy and support the trial court's

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 De La Torre

finding that the marital home is community property. court held that
the marital home was community
d. Long Marriage Presumption
i. When a long marriage, typically 10 years or more ends, ends in divorce, it
sometimes happens that no one remembers when an item of property was
acquired. When this occurs, the general community property presumption is
not triggered because it requires proof of the time of acquisition. If the item
of property was possessed during a long marriage, the item is presumed to
have been acquired during marriage, thus triggering the general community
presumption
1. Impossible to know when property was acquired
2. Solves problem by presuming property possessed during a long
marriage was acquired during the marriage, thus triggering the general
CP presumption
a. Fidelity & Casualty Company v. Mahoney 1945
i. Where the marriage relation has existed a short period
of time, the presumption that property acquired after
marriage is community property is of less weight than
in the case of a long-continued marriage relation.
Possession during a short marriage is not enough to
raise the community property presumption
1. As time goes on, things become more
comingled
e. Property in joint form
i. Real or personal property, acquired during marriage, and prior to separation
and acquired in joint form is presumed to be community property on divorce.
1. FC § 2581
2. Rebuttal
a. Writing containing a clear statement that the property and not
community property
ii. The possession of money by either or both the husband and wife after
marriage, in the absence of other evidence, raises a presumption that it is
community property
1. Lynam v. Vorwerk 1910
a. Presumption can be overcome by
i. Evidence of clear and convincing character establishing
the contrary and the burden of the showing rested with
the parties claiming the separate character of the
property
iii. Presumption
1. Property acquired after marriage other than by gift, devise, or
descent is community property
2. May be overcome only by clear and satisfactory proof that it is
separate property
iv. Where did the money come from?

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 De La Torre

1. Did he make it before or during marriage?

2. Wife couldn’t articulate about his bank accounts and couldn’t show the
court the $1 that bought the life insurance came from their bank
accounts
3. Was is salary that came from money made prior to marriage or during
4. Could not meet burden of production by showing where it came from
v. Rule
1. To rebut the presumption of property taken in joint tenancy by a
husband and wife, the party must prove a clear intent to maintain the
property as community property
2. Title taken as joint tenancy raises a rebuttable presumption that
the property was held in joint tenancy, and places on the party
claiming it to be community property the burden of overcoming
the presumption
a. Schindler v. Schindler
3. Look toL
a. Must have conversation and disclose information
b. Undisclosed presumptions
c. Parol evidence is admissible
d. Who signed? Admissible to show involvance
4. Real property, titled in a joint tenancy on a deed, is not considered
community property simply because it is purchased with community
property funds and one party intended that it be owned as community
property
f. Married Woman’s Separate Property Presumption
i. Real or personal property, acquired prior to January 1, 1975, by a married
woman, by an instrument in writing, is presumed to be the woman’s separate
property
1. Rebuttal
a. By husband’s testimony that he did not intend to make a gift of
his interest to the wife, plus tracing
2. If acquired by the married woman, the presumption is that the
property is the married woman’s separate property
ii. If acquired by the married woman AND any other person, the presumption is
that the married woman takes the part acquired by her as tenant in common,
unless a different intention is expressed in the instrument
iii. If acquired by husband and wife by an instrument in which they are described
as husband and wife, the presumption is that the property is the community
property of the husband and wife, UNLESS a different intention is expressed
in the instrument
1. If wife is receiving anything alone, owns it outright
2. If sharing it with husband, then it must definitely say
3. If husband decides to put it in wife’s name, then must deal with
consequences
g. Joint Bank Account Presumption

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 De La Torre

i. Deposits by married persons to a joint account are presumed to be community

property.
ii. Probate Code § 5305(a)
iii. Rebutted
1. By tracing to separate property, unless the couple has a written
agreement that the funds in the account are community property
h. Family Expense Presumption
i. Family expenses are presumed to be paid with available community property,
rather than separate property
ii. Look to:
1. Length of bank account that is paying
2. Bank account large or small
3. Monthly salary large or small
4. Money used to pay premium acquired before or after marriage
a. Only entitled if paid from community funds because married
such a short time Fidelity & Casualty Company v. Mahoney
5. Family expense presumption
a. overcome the presumption with evidence that community
expenses exceed community income
b. Presumed CP expenses are used using CP funds anything
left over is presumed to be separate – indirect tracing
i. Title in One Spouse’s Name Presumption
i. When property is acquired by a. married person in that spouse’s name alone,
the presumption that applies is the general community property presumption
j. Community Property Form of Title Presumption FC § 2581

i. FC § 2581
1. Applies
a. When property is “acquired by the parties during marriage in
joint form” and parties divorce, not die.
b. FC § 2640 – see above
2. § For the purpose of division of property on dissolution of marriage or
legal separation of the parties, property acquired by the parties during
marriage in joint form, including property held in tenancy in common,
joint tenancy, or tenancy by the entirety, or as community property, is
presumed to be community property. This presumption is a
presumption affecting the burden of proof and may be rebutted by
either of the following:
a. (Effective 1/1/1984 and is not retroactive for either a or b and
cannot apply a or b prior to 1/1/1984)
b. After 1/1/1984 FC§ 2581 must be in writing
i. § (a) A clear statement in the deed or other
documentary evidence of title by which the property is
acquired that the property is separate property and not
community property; and

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 De La Torre

ii. § (b) Proof that the parties have made a written

agreement that the property is separate property.
3. When property is held as joint tenants, on divorce, the property is
presumed to be entirely CP
ii. Rebuttable presumption
1. Can only be rebutted by a writing plus tracing funds to separate fund
k. Property held in joint title
i. Joint tenancy
1. The presumption that property acquired during marriage is
community property may be overcome by title evidence that the
husband and wife hold the property as joint tenants
2. Two or more people own undivided interests in property. Each owns
the whole property. It requires the unity of time, title, interest, and
right to possession. It has a right if survivorship. When one tenant dies,
the remaining joint tenants owns the whole. The deceased cannot
devise her interest in the property because it belongs to the survivor.
a. Can be severed and then the property becomes a tenancy in
common
i. Severance occurs by filing a document with the county
recorder of deeds indicating the intent to sever joint
tenancy. A tenant in common can devise the tenant’s
interest in the property to whomever the tenants wishes
and the interest passes by intestacy. They can own
unequal fractional interests in the property
3. Equality of ownership = joint tenancy
a. Survivor takes all
4. Tenancy in common
i. Does not require proportional interests
5. Joint tenancy creates equal fractional interests in an undivided parcel
of property
a. Each spouse owns ½ interest – separate property each have 1/2
b. Can be unilaterally transferred
c. Alienates the spouse’s interest and destroys right of
survivorship
d. Must be designated on the deed SPECIFICALLY otherwise
goes back to general community property
6. CP with right of survivorship became available July 1, 2001.
Identical to right of survivorship in joint tenancy
l. § 600 a presumption is an assumption of fact that the law requires to be made from
another fact or group of facts found or established
i. Presumption is not evidence but conclusions that the law requires to be
drawn in the absence in a sufficient contrary showing
1. If you are trying to go against the norm and something should be
different, your burden to prove that

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 De La Torre

ii. An inference is a deduction of fact that may be logically and reasonably be

drawn from another fact or groups of facts established in the action
1. looking at the totality of the circumstances the only logical
conclusion that can be made and the decision that the court
m. § 603 Presumption affecting burden of producing evidence
i. Established to implement no public policy other than to facilitate the
determination of the particular action in which the presumption is applied
ii. Means
1. If you can prove one existing fact, then the burden switches to the
opposing marriage
a. Yes, it was acquired during marriage however I received it as a
gift
iii. Acquired during marriage or merely possession
1. Formulation contains a burden of proof issue that is avoided by the
possessed during marriage
2. Case law has a presumption in favor of community property thus the
must show that acquisition is traceable or lucrative to a separate
property source (assets acquired during marriage)
a. Has to persuade judge that it is something possessed during
marriage or acquired
n. FC § 802
i. Presumption that property acquired during marriage is community property
does not apply to any property… held by a person at the time of the persons
death if the marriage during which the property was acquired was terminated
by divorce more than four years before
VIII. Benefits: Pension, Disability, Insurance, and other Benefits
a. Rule of Law – Health Insurance
i. Rule
1. Husband’s post-retirement participation in his employer’s health care
plan was not property subject to division on divorce
b. Rule of Law – Life Insurance
i. Premiums must be paid with community property in order for them to be
community property
ii. Term policy – Court Divided
1. Marriage of Lorenz1983 held that term life insurance, with no cash
surrender value, was not a divisible community asset; OR
2. Marriage of Gonzalez 1985 disagreed with Lorenz
iii. Whole Life Insurance
1. Has cash surrender value in addition to cash proceeds on death. The
cash surrender value builds up from premiums. To the extent the cash
surrender value is earned with CP, it is CP, divisible on divorce
c. Employee benefits – Rule
i. “vested” and “nonvested” pension rights should be treated alike
ii. Pension rights, whether or not vested, represent a property interest; to the
extent that such rights derive from employment during coverture they

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 De La Torre

comprise a community asset subject to division in a dissolution proceeding.

The community owns all pension rights attributable to employment during
marriage.
1. A nonvested pension right is a contractual right, subject to property
classification and are subject to division at divorce
a. Marriage of Brown 1976
2. Community owns all pension rights attributable to employment during
marriage. When Community funds or efforts are expended to acquire a
conditional right to future income, the courts do not hesitate to treat
that right as a community asset
a. Overturns the French Rule
i. Will apply retroactively to any case in which the
property rights arising from the marriage have not yet
been adjudicated
iii. Decision to Not Retire
1. A settled principle that one spouse cannot by invoking a condition
wholly within its control defeat the community interest of the other
spouse
a. Marriage of Steinquest
b.
2. A unilateral choice to postpone retirement cannot be manipulated so as
to impair a spouse’s interest in retirement benefits
a. Marriage of Gilmore 1981
1. Because H could have quit or retire at any time
and receive his benefits, he could not time his
retirement to deprive W of an equal share of the
community interest in his pension. It is well
settled that, one spouse cannot, by invoking a
condition wholly within his control, defeat the
community interest of the other spouse. H’s
benefits were both vested and matured, the only
condition precedent is within his control and
therefore the rule
3. Gilmore Election
a. A spouse that is eligible to receive their portion of their
retirement benefits even though the other spouse chooses to
work, is electing to cut off their share at a specific amount to
receive it in that moment, rather than waiting.
b. Two choices:
i. 1) Wait until the spouse retires and receives their
pension
ii. 2) take pension pay when person “could have retired”
1. Fixe at that rate
d. Apportioning Retirement Benefits
i. Early Retirement Benefits – Rule

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 De La Torre

1. A nonemployee spouse who owns a community property interest in an

employee spouse’s defined benefit retirement plan also owns a
community property interest in the latter’s retirement benefits as
enhanced
2. Apportionment and not characterization
3. Community will share in the enhanced retirement that they would have
shared under a regular retirement
i. Marriage of Lehman 1998
1. The court stressed that it is an issue of apportionment. You
cannot state that the community did not have an interest in the
enhanced retirement benefits. The community only received that
right the enhanced ability based on the total amount of service
and because that includes community property time, then it needs
to be properly apportioned when calculating retirement benefits
2. Analysis needs to be totality of the circumstances – equitable
terms of being fair under the totality of the circumstances
e. The time-rule determination
i. provides that there exists a community-property interest in proportion to the
amount of service years while married to total service years, is only
appropriate when the calculation of the amount of retirement benefits is
based on the years of service. Otherwise, there is no relationship between the
years of service and the amount of the retirement benefits.
1. Follows § 2550 where the total number of years served by an
employee-spouse is a substantial factor in computing the amount of
retirement benefits to be received by that spouse, the community is
entitled to have its share based upon length of service performed on
behalf of the community in proportion to the total length of serviced
necessary to earn those benefits. The relation between years of
community service to total years of service provides a fair gauge of
that portion of retirement benefits attributable to community effort
2. the calculation of a community-property interest in a spouse’s
retirement benefits should not be measured using the time-rule
determination when retirement benefits are not based upon years of
employment, qualifying years.
ii. Numerator
1. Time employed during marriage
iii. Denominator
1. Total years the pension was earned
iv. The separate property interests
1. The percentage representing the percentage the remainder of 100%
2. Community interest is the initial number, and thus the separate
property will be
v. 100% - community property interest = separate property
vi. Only where the amount of the retirement benefits is substantially related to the
number of years of service

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 De La Torre

1. Military is different because an active duty will accumulate more

points based on the acts of service as they relate to how retirement is
accumulated – must determine what is the most fair and appropriate
f. Installment Contract
i. Rule
1. On an installment contract, the community acquires equity in the
property in the same proportion as the amount contributed to the
purchase price by the community
a. Justice demands that rights of the parties should be measured
by the direct contributions made by the respective parties to the
purchase price of the property
b. CP entitled to same proportion as amount contributed by the
community
c. Contributions to the improvement of a spouse’s separate
property may create only a right of reimbursement
d. Following strong public policy of protecting the community
i. Veux v. Veux 1926
ii. Moore/Marsden Rule
1. What is the proper method of calculating the interest obtained by the
community as a result of payments made during marriage on the
indebtness secured by a deed of trust on the residence that had been
purchased by one of the parties before marriage?
i. Amounts paid for interest, taxes, and insurance do not
contribute to the capital investment and are not
considered part of it – do not increase value of property
and are not considred in the division in a dissolution of
marriage
ii. When the market value of an asset has risen between
purchase and marriage, Aufmuth/Moore accounting
must be refined to take premarital appreciation into
account. Clearly, any premarital appreciation must be
attributed to the purchasing souse’s separate estate.
Marriage of Marsden 1982
b. The value of real property is generally represented by the
owner’s equity in it and the equity value does not include
finance charges or other charges required to maintain the
investment
2. Rule
a. Where community funds are used to make payments on
property purchased by one of the spouses before marriage, the
rules in decisions in California gives to the community a pro
tanto community property interest in such proportion to the
ratio that the payments on the purchase price with community
funds bear to the payments made with separate funds. This
excludes payments for interest and taxes.

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 De La Torre

i. Marriage of Moore 1980

1. Applies to the principle reduction made by the
community to a separate property asset
ii. Aufman/Moore
1. Applies to separately titled property acquired
before marriage when community funds have
paid off a purchase money debt
2. Must take into account premarital
appreciation
iii. Applies with an asset
iv. Applies to jointly titled property
iii. Formula Moore/Marsden
1. SP Amount contributed/purchase price
2. CP amount contributed/purchase price
a. (Frick uses historic purchase price)
3. Then
4. Market value ( - ) Principal owed/debt
5. Then multiply by percentage
6. *don’t forget to split the Community asset
g. Vacation and Sick Days
i. Accrued vacation pay earned during marriage is CP
h. Employee Stock Options
i. Stock options earned for work during marriage and before separation are CP
i. Severance Pay
i. Rule- Severance
1. Compensation received after marriage and whose only purpose is to
compensate for future damages is separate property and therefore not
subject to division upon dissolution
2. Compensation for future loss of earnings, not payment for services
rendered
a. Marriage of Wright 1983
i. Chaplain (Wife’s dad) was involved in the harassment
and hospital most likely wanted to avoid a lawsuit by
Husband. They recognized by the totality of the
circumstances; they gave him his yearly salary to help
compensate him. Paid to him to make him feel whole in
the future rather than compensate for past work or lost
wages
ii. Look to:
1. What purpose did the severance serve?
a. 1) if severance was a reward for past service and employee
was married, then severance is CP
b. 2) intended to replace lost future income after the couple
separated, severance is SP
j. Right to reinstate Retirement Benefits

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i. The redeposit right, is a pension right and the community owns all pension
rights attributable to employment during the marriage
1. Marriage of Lucero 1981
ii. The duties of spouses to deal fairly with each other do not terminate when
they separate.
1. Treated as property
k. Repeal of the terminable Interest Rule
i. Allowed to distribute the death/survivor benefits in a community property
dissolution
ii. Because the husband had earned the right to redeposit the funds because of
this employment with the government, and that right was earned during the
marriage, thus the total amount that he would have received after the redeposit
iii. If a contractual right is acquired during the marriage that contractual right will
be evenly distributed to the community
iv. § 2610
1. (a) Except as provided in subdivision (b), the court shall make
whatever orders are necessary or appropriate to ensure that each
party receives the party's full community property share in any
retirement plan, whether public or private, including all survivor
and death benefits, including, but not limited to, any of the following:
v. What § 2610 means
1. A divorced nonemployee spouse may assert her community property
interest in any benefit generated by community labor
2. A deceased divorced nonemployee’s estate may make a claim
l. Disability benefits
i. Servicemen entitle them to receive retirement 3 options
1. 1) He has served at least 20 years
a. VA benefits
b. Service member gives up a portion of regular retirement
benefits to obtain VA disability benefits
c. Court cannot divide the retired pay that a service member gives
up to receive the VA Disability
2. 2) His disability rates at 30% or higher and he has served at least 8
years, or
a. Military disability retired pay
3. 3) His disability rates at 30% or higher and was incurred on active
duty, or in the line of duty during wartime
a. Combat-related special compensation
b. Not divisible by divorce
ii. If permanently disabled and none of those options work
1. Receive disability severance pay
2. Rule – Serviceman
a. A serviceman’s right to “disability” pay, acquired before he
had earned a “vested” right to ordinary retirement pay
iii. Analyze
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1. When a spouse is entitled to receive a pension only because he is

disabled, and has no right to a pension because of longevity of service,
the disability benefit payments are his separate property upon
dissolution of marriage. A married serviceman’s right to disability pay,
unlike a vested right to retirement pay, does not comprise a community
asset and thus does not become subject to division upon dissolution of
the marriage. Disability pay is not a form of deferred compensation for
past services. It serves to compensate the veteran for the loss of
earnings resulting from his compelled premature military retirement
and from diminished ability to compete in the civilian job market.
These losses fall upon the disabled spouse, not on the uninjured and
healthy spouse; hence upon the dissolution of marriage the right of the
disabled spouse to future disability payment should be his separate
property asset.
a. Marriage of Jones 1975
iv. What is the retirement pay actually replacing?
v. Rule
1. A service man’s right to retirement and disability pay, acquired after
he had earned a vested right to ordinary retirement pay must be
apportioned by time-based analysis between community property and
separate property.
m. Allocating disability benefits
i. Rule - Method of allocating a community pension
1. Where the employee spouse elects to receive disability benefits in lieu
of a matured right to retirement benefits, only the net amount thus
received over and above what would have been received as retirement
benefits constitutes compensation for loss of earning capacity and is
thus, the employee spouse’s separate property.
2. The amount received in lieu of matured retirement benefits remains
community property subject to division on dissolution
a. Marriage of Mueller 1977
i. If elected to retire without disability payment
ii. In choosing to retire with the disability election
ii. Case example
1. If elected to retire without disability payment
2. Would have received 65% of disability at basic retirement
3. Know what he received as a result of his disability to calculate
community property interest
4. Because retired with disability, received 75% and therefore the
community gets 65% and he gets 10% separate property
I. Marriage of Stenquist I978
IX. Business as CP or SP
a. Property acquired by time, effort, and energy = CP
b. Apportionment of Equities

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i. The profits accruing from husbands separate property are also separate
property § 770. A community should receive a fair share of the profits which
derive from the husband’s devotion of more than minimal time and effort to
the handling of his separate property.
ii. Earnings
1. The rule is that where the husband is operating a business is his
separate property, income from such business is allocated to
community property or separate property in accordance with the extent
to which it is allocable to the husband’s efforts or his capital
investment
a. Huber v. Huber
b. Deduct from the total earnings of the business the value of the
husband’s services to it. The remainder represents the earnings
attributable to the separate property invested in the business
iii. Value of business (-) value of husband’s services = earnings attributable
to the separate property invested in the business
c. Increased Value of the business
i. When a business increases in value due to the efforts of one or both spouses, it
is necessary to characterize the increased value. When a spouse owns a SP
business or asset that increases in value during marriage due in part or in
whole to efforts of the owner spouse, California provides that increased value
is CP to be divided on divorce. The business itself remains SP. It is the
increased value attributable to efforts of the owner spouse that is CP.
ii. Two scenarios
1. Increased value is due
a. to the efforts of the owner spouse, increase = CP
i. increase value bc efforts owner spouse = Pereira
ii. judge allocates a fair return on the owner spouse’s
business and allocates the rest of the increased value as
CP arising from owner’s efforts
b. Owner’s efforts account for only a small portion of the
increase, market forces account for the increase = SP
i. Increase value due to market forces = Van Camp
ii. Judge determines the reasonable value of the owner
spouse’s services to the business and allocates the
amount ac CP. The remainder of the increase is SP
iii. Profits:
1. An apportionment of profits is required not only when the husband
conducts a commercial enterprise but also when he invests separate
funds in real estate or securities
a. Profits accruing from separate property is separate property
b. Court has wide discretion in admission of expert testimony, the
salary customarily paid to position of Husband is relevant and
competent evidence of the reasonable value of such services in
a particular business of that character

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2. ***The disposition of marital property is within the trial court’s

discretion, by whatever method or formula will achieve substantial
justice between the parties***
a. Gilmore v. Gilmore 1955
3. Either Pereira or Van Camp – what is the growth attributable to?
d. Pereira
a. Held that marital labor should be regarded as a community
contribution to the business, and growth in the value of the
business during marriage should be apportioned between the
community and separate estates
b. Growth
i. Husbands efforts use this – personal to spouse
c. Community income
i. The amount by which the actual income of the separate
estate exceeds the return which the initial capital
investment could have been expected to earn absent the
spouse’s personal management
d. Allocate fair return, interest on the capital investment of the
business, allocate such interest as separate property, and treat
the balance/the excess as community earnings attributable to
the efforts of the husband arising from the parties efforts
i. Usually increase was due mainly to services
1. Calculated by subtracting the spouse’s 1)
separate property investment into the business
and 2) the amount the separate property
investment contributed to the total income and
earnings of the business
e. If you are the out spouse, you want this analysis!
i. Specialized skills is the reason the business did so well
during marriage
2. Van Camp
a. Growth
i. Capital investment – the value contributed by the
spouse that grew the business
1. Nothing that husband did, business ran itself, it
was capital investment rather than services
b. Allows courts to determine the reasonable value of the
husband’s services, allocate that amount as community
property, and treat the balance as separate property attributable
to the normal earnings of the separate business
i. Usually If the increase was mainly due to capital
1. Identifies the community component of a
business that one spouse brought into the
marriage by valuing that spouse’s employment
in the business during marriage

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2. Any remaining value is the business spouses’

separate property
ii. Rule recognizes that despite community labor going
into an ongoing g business, a business may be
successful for reasons other than labor, where the
business would make profits regardless of labor
c. Analyze
i. Once a court ascertains an amount of cp income, it
deducts the c living expenses from community income
to determine the balance of the cp
ii. Working spouse wants to make sure they can try to
recapture some of the money that they paid out
3. Important***
a. In applying apportionment of the earnings of a separate
business between return on capital and community property,
the court may select whatever formula will achieve substantial
justice between the parties
i. Tassi v. Tassi 1958
4. Analyze
a. Courts recognize Income arising from a parties skill, industry,
effort, is cp, the community should receive a fair share of the
problems which arrive from the party’s devotion of more than
minimal time and effort to the handling of his separate property
additionally the apportionment of profits not only when he
conducts a commercial enterprise or invests in securities
b. Start with Presumption family expense
e. When Couples Separate and One Continues Running Business - Reverse
i. A married person’s post-separation efforts generate SP. If business increases
in value due in whole or part to thee separated spouses’ efforts, it is necessary
to apportion the increased value
ii. Reverse Pererira – a fair return on the CP business is allocated to the
community
iii. Reverse Van Camp the court determines the reasonable value of the spouses
services, minus salary paid to the spouse and allocates that amount as SP. The
balance of the increase is CP
f. Goodwill
i. Rule – Goodwill
1. The advantage or benefit which is acquired by an establishment
beyond the mere value of the capitol stock, fund, or property therein,
in the consequence of the general public patronage and encouragement
is receives from constant or habitual customers, on account, of its local
position, or common celerity, or reputation for skill or affluence, or
punctuality, or from other accidental circumstances or necessities, or
even from ancient partialities or prejudice
a. Covenant not to Compete

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i. Establishing a value for a future covenant not to

compete, separate from the value of the business
goodwill itself, is entirely too speculative
1. Marriage of Czapar 1991
b. Should be there to protect the value of the business goodwill.
Court cannot consider a speculative covenant not to compete. If
there was a business agreement between the two parties then
the court could consider it

ii. Fictious amount of money that your business is worth and no one can
pinpoint why
1. Marriage of Fortier 1973
2. Take amount made
a. $131,500
3. minus the market value of business
a. $120,000
4. = capitalized excess earnings method in valuing the goodwill of
John’s medical practice
a. = $11,500 split
iii. The mere fact that a professional practice cannot be sold, standing alone, will
not justify a finding that the practice has no goodwill nor that the community
has no value.
iv. Proper means of arriving at the value of such goodwill contemplate any
legitimate method of evaluation that measures its present value by taking into
account some past result
v. California the courts have agreed professional goodwill is a divisible
community asset
vi. Court must:
1. 1) determine if goodwill exists
2. 2) Consider the value of it
3. 3) take it into consideration when dividing community property
vii. Value it
1. The market value at which goodwill could be sold upon dissolution of
the marriage, taking into consideration the expectancy of the
continuity of the practice
2. Courts are not bound by the amount listed in a corp, llc,
agreement, partnership agreement because they are limiting the
amount the goodwill can be valued at.
3. Court is not bound
4. ***Can take into the consideration the totality of the circumstances
g. Education and Licenses
i. Rule

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1. A spouse who has made economic sacrifices to enable the other spouse
to obtain a professional education is entitled to reimbursement but not
compensation
a. Marriage of Sullivan 1984
2. Legislature amended the Family Law Act on January 1, 1985
ii. FC §2641(b)(1) absent a written agreement to the contrary, and subject to
certain limitations, the community shall be reimbursed for community
contributions education or training of a party that substantially enhances the
earning capacity of the party
1. If a divorce occurs more than 10 years after degree is earned, the
law presumes the community has benefited sufficiently from the
degree that reimbursement is unwarranted
2. Debt incurred by the educated spouse, follows the educated spouse.
Any unpaid loan is assigned to the educated party as his or her
separate debt, thus excluding it from the division of assets and
liabilities
a. Court must consider when awarding spousal support, the
extent to which the supported spouse contributed to the
attainment of an education, training, or license by another
spouse § 4320
i. An additional way for a spouse to be made whole by
allowing for additional spousal support to take into
consideration
1. Educated spouses earning capacity
ii. Interpreted broadly to require consideration of all of the
working spouse’s efforts to assist student spouse in
acquiring an enhanced earning capacity
1. Marriage of Watt 1989
I. An additional way for a spouse to be
made whole by allowing for additional
spousal support
iii. Court should consider
1. FC § 4330 authorizes courts to order spousal support and should
consider:
a. Marketable skills of supporting party, the job market for those
skills, time and expenses required to acquire training or
education for more marketable skills or employment
b. Extent which supported party contributed to the attainment of
an education, training, a career position, or a license by the
supporting party
c. The ability of the supporting party to pay spousal support,
taking into account the supporting party’s earning capacity,
earned and unearned income, assets, and standard of living
d. Duration of the marriage

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e. Needs of each party based on the standard of living established

during marriage
f. Obligations and assets, including the separate party, of each
party
g. Age and health of the parties
h. Ability to engage in gainful employment without interfering
with the interests of the dependent children
iv. Compensable community contributions
1. Payments made with community for education or training or the
repayment of a loan incurred for education or training.
a. May be reduced or modified if an injustice would otherwise
result
v. Meaning of “the extent to which the supported party contributed to the
attainment of an education”
1. Rule FC § 2641(b)
a. Totality of the nonstudent spouses’ contribution and effort
to the attainment of that degree, including contributions for
living expenses when making a spousal support award decision
b. However, reimbursable community expenditures for the
student spouse’s education under § 2461 generally do not
include ordinary living expenses
i. Cost of tuition, books and supplies, and transportation
ii. Related to the education experience itself
1. Separate apartment or dorm is not considered
ordinary living expenses and thus can be
reimbursable
2. Not in the course in the ordinary living
arrangements held by ordinary individuals
X. Transmutations Week 5 192-236 here
a. During marriage, a couple is free to change the character of property. Thus, a couple
may change SP to CP, CP to SP, or SP of one spouse to SP of the other FC 850.
Such changes are called transmutations. Prior to January 1, 1985, a transmutation
could be written or oral. Effective January 1, 1985, all transmutations must be in
writing by an express declaration that ownership of property is being made, changed,
joined in, consented to or accepted by the spouse whose interest in the property is
adversely affected. FC § 852
1. The “express declaration” requirement does not apply to a gift between
the spouses of clothing, wearing apparel, jewelry, or other tangible
articles of personal nature that is used solely or principally by the
spouse to whom the gift is made and that is not substantial in value
taking into account the circumstances of the marriage. Fam Code §
852
2. The transmutation statute blocks efforts to transmute marital property
based on evidence- oral, behavioral, or documentary- that is easily
manipulated and unreliable

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ii. Unless specifically intended to change the characterization, it will stay

separate or community unless there is an agreement otherwise
1. In Marriage of Jafeman
b. Court analyzed the Estate of Benson, analyze McDonald states a writing satisfies the
express declaration requirements only if it states on its face that a change of
character or ownership of the subject properties being made.
i. Increases certainty that a transmutation occurred
ii. 852 does not operate like the general statute of frauds, part performance of the
contract’s terms
1. Part performance can be used in pre-marital agreement – aka must be
fully executed
2. Surrounding circumstance do not suffice to show an agreement – must
be in writing subject to rule 852
a. Estate of Benson pg 200
c. Pre-1985
i. Oral agreement
1. Income tax returns as evidencing an agreement between plaintiff and
defendant converting ½ of plaintiff’s separate interest in the
partnership profits into community property
a. All that is required to show an executed oral agreement of
transmutation is proof of the parties’ acts and conduct in
dealing with their property
b. The object of the oral agreement of transmutation was fully
performed when the agreement was made for immediately
transmuted and converted the separate property of each spouse
into community property
2. Change in the status of the property may be shown by the very
nature of the transaction or appear from the surrounding
circumstances Marvin v. Marvin
a. Can be oral
b. The use of the term partner does not necessarily imply an
intention of a legal partnership
i. Estate of Raphael 1949
3. Record must present substantial evidence of an implied agreement
between parties to alter the character of Edwards initial equity in the
home
a. Use of property in marital relationship does not alter its
character
i. Ex. House that the married couple lives but was H’s
separate property
d. Post- 1984 Transmutation
i. FC 851 Fraudulent transfers laws apply
1. A transmutation is subject to the laws governing fraudulent transfers
a. Intended to protect the interests of creditors
ii. FC 852 Form of Transmutation *****

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1. (a) a transmutation of real or personal property is not valid unless

made in writing by an express declaration that is made, joined in,
or consented to, or accepted by the spouses whose interest in the
property is adversely affected
iii. FC 853 Effect of Will
1. A statement in a will of the character of property is not admissible as
evidence of a transmutation of property in a proceeding commenced
before the death of the person who made the will
a. Just bc you promised at death, does not mean that you get it
before then.
e. Value Insurance policies
i. Whole cash has cash value
1. Savings account
ii. Term value does not have a cash value
1. I pay for it and if an accident occurs during the specific term then the
life insurance policy will pay out
f. Upon a dissolution of a marriage, unless statutory requirements have been met, the
life insurance policy is community property
a. A will can be changed or revoked during the lifetime of the
testator. Thus, a statement in a will about changing
property does not qualify as a transmutation. However,
when the testator dies, the will speaks, and an otherwise valid
transmutation in the will is enforceable.
ii. Transmutations and Fiduciary Duties
1. A transmutation agreement is subject to the fiduciary standards set
forth in Family Code § 721(b). (See § 10.7). A transmutation
agreement that advantages one spouse over the other is presumed
to have been induced by undue influence.
2. To rebut the presumption of undue influence, the advantaged
spouse must prove, by a preponderance of the evidence,
3. that the disadvantaged spouse:
a. (1) freely entered into the transmutation;
b. (2) had full knowledge of the facts; and
c. (3) understood the legal implications of the agreement.
g. Uniform Fraudulent Transfer Act A transmutation is subject to the Uniform
Fraudulent Transfer Act (UFTA) (Family Code § 851). The UFTA is found at Civil
Code § 3439. The Act is intended to protect unsecured creditors from property
transfers by debtors that impede creditor rights. For example, Debby Debtor
realizes that her creditor is about to take her home to enforce a debt. To avoid this,
Debby deeds the home to her sister for $1.00. This transfer is fraudulent as to the
creditor. The UFTA provides a remedy for two types of fraudulent transfers: Actual
fraud and constructive fraud. A transfer constitutes
i. actual fraud
1. when it is made “with actual intent to hinder, delay, or defraud any
creditor of the debtor” (Civil Code § 3439.04(a)(1)).

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ii. Constructive fraud

1. occurs when a debtor conveys property without receiving reasonably
equivalent value in exchange, and the transfer renders the debtor
insolvent (Civil Code § 3439.04(a)(2)(B)).
XI. Credit Acquisitions – Intent of the lender rule 267-275, 276-287, 287-289
a. Family Code §760
i. Except as otherwise provided by statute, all property, real or personal,
wherever situated, acquired by a married person during the marriage while
domiciled in this state is community property.
1. Presumption only controlling when it is impossible to trace the source
of the specific property
b. Intent of the Lender Rule
i. The character of property acquired by a sale upon credit is determined
according to the intent of the seller to rely upon the separate property of the
purchaser or upon community asset.
1. Estate of Ellis
ii. ***If the separatizer cannot satisfy Gudel(primarily) or Grinius then
community property prevails
1. Guelj
a. CP presumption is rebutted with evidence the lender relied
primarily on SP to repay the loan
2. Grinius
a. Rebuttal of the CP requires evidence the lender relied solely on
SP for repayment
c. Presumption:
i. Property acquired on credit during marriage is presumed to be community
property
ii. Funds procured by the pledge of money for a specific purpose you
feel(hypothecation) of separate property of a spouse are separate property of
that spouse
iii. Proceeds of a loan made on the credit of separate property are presumed to be
separate property
d. Analyze
i. The tracing technique used to rebut the CP presumption with loans, items
purchased with loans, and credit acquisitions, is the intent of the lender test.
The separatizer offers evidence that the lender relied for repayment on SP. If
the lender relied on SP for repayment, then the loan was SP and items
purchased with the loan are traceable to SP, rebutting the CP presumption.
ii. In the absence of evidence tending to prove that the seller primarily relied
upon the purchaser’s separate property in extending credit, the trial court must
find in accordance with the presumption it is a community property loan or
community property asset. The Intent of the seller shows what asset they
were relying on.
1. Signature suggests a lender looked toward community assets for
security. However, the signature on the note and instruments of

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hypothecation does suggest the lender did look to community assets

for security. However, without more it is not compelling.
iii. There are two formulations of the intent of the lender test, Gudelj test and
Grinius test. A married person’s creditworthiness belongs to the CP. With
Gudelj, the separatizer need only prove that the lender relied primarily on SP
for repayment. If the separatizer cannot satisfy Gudelj, the CP presumption
prevails.
1. While California Civil Code § 163 refers to separate property as
property owned by the husband before marriage, the case law
distinguishes rightfully between technical ownership by contract and
ownership for which the purchase price is still being paid after
marriage out of community-property funds. When this occurs,
ownership is not determined by the title at the time of the purchase
contract, but by the proportion of separate versus community assets
used as payments for the property. 

XII. Tort Recovery/Life Insurance/ Employee Benefits 289-307, 307-332 Brief Devlin &
Gilmore
a. ****What does it replace? What are they trying to make whole? Community
asset, then underlying award will be community asset
i. Compensate for a loss – separate property
ii. Always analyze under the facts under the Totality of the Circumstances
b. When a spouse is injured, and receives money damages, the money is CP of the cause
of action arose during marriage and prior to separation § 780. If the cause of action
arose after separation, the money is sperate property § 781. If one spouse injures the
other, money paid to compensate for the injury is the SP of the injured spouse. In
divorce proceedings, if the parties cannot agree on how to divide the CP, the court
will divide evenly FC § 2550. When personal injury damages are CP because the
COA arose during marriage and before separation, FC § 2602(b) creates an
exception. It mandates that 100% of CP PI money be assigned to the injured spouse.
The injured spouse’s need for the money outweighs the principal of equal division of
CP. The court considers how much time has gone by since the injury as well as the
economic circumstances
c. Liability Tort judgments depend on whether or not the spouse who committed the tort
committed it while benefiting the community. Family Code § 1000 states that if the
tort was committed while benefiting the community, then the creditor may collect
from the couple’s community property first, and if more money is needed to satisfy
the debt, then whoever committed the tort will have to pay out of their separate
property. However, if the tort was committed during an activity that did not benefit
the community, the creditor first collects from the spouse who committed the tort
separate property first, and then collect from the couple’s community property after,
if more money was needed to settle the dispute.
d. Family Section Code § 780 § 2603
i. § 780

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1. Except as provided in Section 781, and subject to the rules of § 2603,

money and other property received or to be received by a married
person in satisfaction of a judgment for damages for personal injuries,
or pursuant to an agreement for the settlement or compromise of a
claim for such damages, is community property if the cause of action
for the damages arose during the marriage.
a. *Personal injury damages received or to be received from a
cause of action arising during marriage are community
property
b. Date that the injury/accident actually occurred
ii. § 783
1. If a married person is injured by the negligent or wrongful act or
omission of a person other than the married person's spouse, the fact
that the negligent or wrongful act or omission of the spouse of the
injured person was a concurring cause of the injury is not a defense in
an action brought by the injured person to recover damages for the
injury except in cases where the concurring negligent or wrongful act
or omission would be a defense if the marriage did not exist.
e. FC § 1000 Liability for Injury or Death
i. if liability arises out of an event for the benefit of the community, the first
recourse is to the community estate, and the tortfeasor spouse’s separate
property is secondarily liable only to the extent the community estate is
insufficient. Alternatively, if the tortfeasor spouse was not acting for benefit
of the community, the first recourse is to the tortfeasor spouse’s separate
property, and the community estate is secondarily liable only to the extent the
separate property is insufficient.

1. determining liability for a tort, the liability will attach at the time the
tort is committed, not at the time the judgment is actually obtained.
f. FC §1102- While the post marital creditors of one spouse can reach all community
property, they generally cannot reach the nondebtors souse’s separate property
i. The nondebtor’s spouse’s one-half interest in a joint tenancy may be immune
from his or her spouse’s creditors
ii. § 2603

1. (a) “Community estate personal injury damages” as used in this

section means all money or other property received or to be
received by a person in satisfaction of a judgment for damages for
the person's personal injuries or pursuant to an agreement for the
settlement or compromise of a claim for the damages, if the cause
of action for the damages arose during the marriage but is not separate
property as described in Section 781 , unless the money or other
property has been commingled with other assets of the community
estate.

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2. (b) Community estate personal injury damages shall be assigned [at

divorce] to the party who suffered the injuries unless the court, after
taking into account the economic condition and needs of each party,
the time that has elapsed since the recovery of the damages or the
accrual of the cause of action, and all other facts of the case,
determines that the interests of justice require another disposition.  In
such a case, the community estate personal injury damages shall be
assigned to the respective parties in such proportions as the court
determines to be just, except that at least one-half of the damages shall
be assigned to the party who suffered the injuries.

a. Upon dissolution, the proceeds labeled “community estate

personal injury damages”

i. are to be assigned to the injured spouse unless

1. the court, considering the facts of the case,

determines the interests of justice required
another disposition

b. Look to:

i. Economic condition, needs of the party, the time that

has elapsed since the recovery of the damages, or the
accrual of the cause of action, and all other facts of the
case

c. Judge

i. PI damages shall be assigned to the respective parties in

proportions as the court determines, except ½ damages
shall be assigned to the party who suffered injuries

d. Effect

i. Nominally characterize a PI recovery as “community

estate” property, but to assign it entirely to the injured
spouse unless certain enumerated factors persuade the
court to assign up to ½ the award to the other spouse?

ii. Must the court give ½ the proceeds or it is in their

discretion?

e. Injured party will receive 100% of the proceeds unless under

the totality of the circumstances that the community or the
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uninjured spouse should receive portion of the total damages

recovered should go to the other party in the interest of
justice, but the injured spouse can never get less than 50%
g. Tort Recoveries and Insurance Proceeds
i. Personal Injury Awards Settlements
a. Personal injury award is neither onerous or lucrative
2. Injury during marriage
a. When a spouse is injured, and receives money damages, the
money is community property if the cause of action arose
during marriage and prior to separation § 780
i. Assets purchased with proceeds from a personal injury
award received by one spouse during the course of
marriage do not become community-property assets
1. Marriage of Devlin 1982 as it pertains to
community property personal injury
b. Analyze § 2603
i. § 2603 recognizes the special nature of the community
property personal injury damages and vests discretion
in the trial court to distribute the damages on
dissolution of marriage. And also vests the special
distributing powers to be analyzed under the totality of
the circumstances. It is clear the mere conversion of cp
pi damages for money into a different form, does not
standing alone removed the items purchased from the
purview from § 2603
ii. The rules regarding the transmutation of separate
property to community property do not apply to
community property personal injury damages.
iii. Separate property is subject to the complete control of
the spouse owning that property. When that spouse
voluntarily uses that separate property for community
purposes, it is logical to imply a gift to that property to
the community in the absence of any agreement or
understanding to the contrary
iv. In light of the analysis, the only time proceeds from a
personal injury award lose their character as community
property personal injury damages is in the absence of
an express agreement, when such proceeds have
been “commingled” with other community property
and it’s impossible to trace the source of the
property funds
3. Injury after separation
a. If cause of action arose after separation, the money is separate
property § 781
4. Spouses injure each other

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a. If one spouse injures the other, money paid to compensate for

the injury is separate property of the injured spouse § 781(c)
h. Recovery for damage to property
i. Recovery for damage to property should be classified as community or
separate according to the character of the damaged property
1. Separate property is damaged, then the separate property is recovered
i. Liability insurance
i. Classify according to character of the underlying property
j. Life Insurance
i. Community asset to the extent the policy is paid for with community property
ii. Term Policy
1. A term policy covers a specific term, like a year. At the end of the
term, there is no value unless it is renewed for another term
a. At dissolution, if Both alive, not divisible because no
monetary value
2. Rule- Term Policy
a. A term life insurance policy upon the life of one spouse is not
divisible as community property under the family law act. Even
though premiums for the policy before separation were paid
with community property funds an exception will arise if the
insured spouse becomes uninsurable during the term paid with
community funds
3. **Rule Term Policy Apportionment
a. Look to amount of time the term covers and look to see what
the last payment was and where it was paid from. If it was paid
from community assets, then the insurance proceeds
become a community property asset. Person who made the last
payment wins, community, or separate
b. Term life insurance covering a spouse who remains insurable is
community property only for the period beyond the date of
separation for which community funds were used to pay the
premium
i. Estate of Logan 1987
1. A term policy does not constitute a divisible
community asset since the policy is of no value,
and the community has fully received what it
bargained for
c. Analyzed term life insurance provides for protection against
the contingency of the death of the insured during the term of
its policy. If the premium for the next term it is not renewed, it
is the same as automobile or car insurance.
iii. Cash Insurance/whole life
1. At dissolution
a. Is divisible and does need to be distributed

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i. Cash value – community property in proportion to

community payment of the premiums
ii. Form of savings and exists apart from the peer
insurance component of the policy
iii. Must be able to trace payment that is used to purchase
the asset in and of itself before determining if it is
community or separate property

XIII. Management Fiduciary Duty – Creditors’ Rights 423-435 562-570 439-446 FC § 910-
916 920 1000

a. The Fiduciary Duty

i. Duty of managing spouse § 721 (b) on or after July 1, 1987

1. Standards for spousal fiduciary duty

a. duty of the highest good faith and fair dealing on each spouse,
and neither shall take any unfair advantage of the other.

ii. Definition of fiduciary

1. The spouse who man ages and controls a particular community asset,
acts as a fiduciary with respect to the other spouses interest in the asset

a. Husbands and wives are held to the same standards as business

partners under the business and professions code

iii. § 1109(e) obligation to make

1. full disclosure to the other spouse of all material facts and information
regarding the existence, characterization, and valuation of all assets
in which the community has or may have an interest and debts for
which the community is or may be liable, and

2. to provide equal access to all information, records, and books that

pertain to the value and character of those assets and debts, upon
request.

iv. This confidential relationship is a fiduciary relationship subject to the same

rights and duties of nonmarital business partners

1. Duty to account

a. True and full information

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2. Duty to secure consent or to consult with nonmanager

v. Breach of Duty by Managing Spouse § 1101

1. Claim against Manager for impairment of interest

a. Spouse has a cause of action if there is a breach of fiduciary
duty that results in an impairment to their ½ interest

2. Accounting

3. Reformation of title
a. May order a spouse be put on the title or that title be held in
some other title to reflect CP characterization
i. Except
1. (1) A partnership interest held by the other
spouse as a general partner.
2. (2) An interest in a professional corporation
or professional association.
3. (3) An asset of an unincorporated business if
the other spouse is the only spouse involved
in operating and managing the business.
4. (4) Any other property, if the revision would
adversely affect the rights of a third person.

vi. Statute of limitations

1. 3 years

vii. Occurs

1. death of a spouse or in conjunction with an action for legal separation,

dissolution of marriage

b. Family Codes – Fiduciary

i. FC § 721
1. (b) spouses are subject to the general rules governing fiduciary
relationships that control the actions of persons occupying confidential
relations with each other. This confidential relationship imposes a
duty of the highest good faith and fair dealing on each spouse, and
neither shall take any unfair advantage of the other. This
confidential relationship is a fiduciary relationship subject to the same
rights and duties of nonmarital business partners, as provided in
Sections 16403, 16404, and 16503 of the Corporations Code,
including, but not limited to, the following:
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a. (1) Providing each spouse access at all times to any books

kept regarding a transaction for the purposes of inspection
and copying.
b. (2) Rendering upon request, true and full information of all
things affecting any transaction that concerns the
community property. Nothing in this section is intended to
impose a duty for either spouse to keep detailed books and
records of community property transactions.
c. (3) Accounting to the spouse, and holding as a trustee, any
benefit or profit derived from any transaction by one
spouse without the consent of the other spouse that
concerns the community property.
ii. FC § 1100(e)

1. (e) Each spouse shall act with respect to the other spouse in the
management and control of the community assets and liabilities in
accordance with the general rules governing fiduciary relationships
which control the actions of persons having relationships of personal
confidence as specified in Section 721 , until such time as the assets
and liabilities have been divided by the parties or by a court.  This
duty includes the

a. obligation to make full disclosure to the other spouse of all

material facts and information regarding the existence,
characterization, and valuation of all assets in which the
community has or may have an interest and debts for which the
community is or may be liable, and to provide equal access to
all information, records, and books that pertain to the value and
character of those assets and debts, upon request.
iii. FC § 1101
1. (a) Spouse has a cause of action if there is a breach of fiduciary duty
that results in an impairment to their ½ interest
2. (b) A court may order an accounting of the property and
obligations of the parties to a marriage and may determine the
rights of ownership
3. (c) A court may order that the name of a spouse shall be added to
community property held in the name of the other spouse alone or
that the title of community property held in some other title form
shall be reformed to reflect its community character, except with
respect to any of the following:
a. (1) A partnership interest held by the other spouse as a
general partner.
b. (2) An interest in a professional corporation or professional
association.

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c. (3) An asset of an unincorporated business if the other

spouse is the only spouse involved in operating and
managing the business.
d. (4) Any other property, if the revision would adversely
affect the rights of a third person.
4. (d)(1) any action under subdivision (a) shall be commenced within
three years of the date a petitioning spouse had actual knowledge
that the transaction or event for which the remedy is being sought
occurred.
5. (2) An action may be commenced under this section upon the
death of a spouse or in conjunction with an action for legal
separation, dissolution of marriage, or nullity without regard to
the time limitations set forth in paragraph (1).

6. (4) apply only to transactions or events occurring on or after July 1,

1987.
7. (e) if a transaction affects CP, a judge, with a motion from one
spouse, decide to not require consent from both spouses, and accept
consent from one if:
a. (1) The proposed transaction is in the best interest of the
community.
b. (2) Consent has been arbitrarily refused or cannot be
obtained due to the physical incapacity, mental incapacity,
or prolonged absence of the nonconsenting spouse.
8. (g) Remedies for breach of the fiduciary duty by one spouse:
a. 50 percent, or an amount equal to 50 percent, of any asset
undisclosed or transferred in breach of the fiduciary duty
plus attorney's fees and court costs.  The value of the asset
shall be determined to be its highest value at the date of the
breach of the fiduciary duty, the date of the sale or disposition
of the asset, or the date of the award by the court.
b. (h) Remedies for the breach of the fiduciary duty by one
spouse, when the breach falls within the ambit proven by clear
and convincing evidence that the defendant has been guilty of
oppression, fraud, or malice as in FC § 3294, the plaintiff, in
addition to the actual damages, may recover damages for the
sake of example and by way of punishing the defendant.
i. an award to the other spouse of 100 percent, or an
amount equal to 100 percent, of any asset
undisclosed or transferred in breach of the
fiduciary duty.
c. Civ Code § 3294

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i. (1) “Malice” means conduct which is intended by the

defendant to cause injury to the plaintiff or despicable
conduct which is carried on by the defendant with a
willful and conscious disregard of the rights or safety of
others.
ii. (2) oppression means despicable conduct that subjects
a person to cruel and unjust hardship in conscious
disregard of that person’s rights
iii. (3) fraud an intentional misrepresentation, deceit, or
concealment of a material fact known to the defendant
with the intention on the part of the defendant of
thereby depriving a person of property or legal
rights or otherwise causing injury
1. Marriage of Rossi 2001
c. Married couples incur debt. A debt is an obligation occurred by a married person
before or during marriage, whether based on contract, tort, or otherwise. FC § 902.
d. FC § 910 Community Estate Liable for Debt of Either Spouse
i. The Community Estate is liable for debt incurred by either spouse before or
during marriage. FC § 910 provides that 100% of CP can be taken by a
creditor too satisfy premarital debts. FC § 911 allows a non-debtor spouse to
protect their paycheck, which is CP, from liability for the debtor’s premarital
checks by putting those checks in the non-debtor’s bank account in their name
alone
1. Does not include period after date of separation
ii. FC § 903 Time Debt “incurred”
1. A debt is “incurred” at the following time:
a. (a) In the case of a contract, at the time the contract is
made.
b. (b) In the case of a tort, at the time the tort occurs.
c. (c) In other cases, at the time the obligation arises.
iii. FC § 912 Liability of Quasi-Community Property
1. quasi-community property is liable to the same extent, and shall be
treated the same in all other respects, as community property.
e. FC § 913 Liability of Separate Property
i. (a) The separate property of a married person is liable for a debt incurred
by the person before or during marriage.
f. FC § 914 Liability for Necessaries

i. a married person is personally liable for the following debts incurred by

the person's spouse during marriage:

1. (1) A debt incurred for necessaries of life of the person's

spouse before the date of separation of the spouses.

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2. (2)  a debt incurred for common necessaries of life of the person's

spouse after the date of separation of the spouses..
g. FC § 916 Liability after Property Division

i. (a) Notwithstanding any other provision of this chapter, after division of

community and quasi-community property pursuant to Division 7
(commencing with Section 2500 ):

1. (1) The separate property owned by a married person at the time of

the division and the property received by the person in the division is
liable for a debt incurred by the person before or during marriage and
the person is personally liable for the debt, whether or not the debt was
assigned for payment by the person's spouse in the division.

2. (2) The separate property owned by a married person at the time of

the division and the property received by the person in the division is
not liable for a debt incurred by the person's spouse before or during
marriage, and the person is not personally liable for the debt, unless
the debt was assigned for payment by the person in the division of the
property.  Nothing in this paragraph affects the liability of property
for the satisfaction of a lien on the property.

3. (3) The separate property owned by a married person at the time of

the division and the property received by the person in the division is
liable for a debt incurred by the person's spouse before or during
marriage, and the person is personally liable for the debt, if the debt
was assigned for payment by the person in the division of the property.
 If a money judgment for the debt is entered after the division, the
property is not subject to enforcement of the judgment and the
judgment may not be enforced against the married person, unless the
person is made a party to the judgment for the purpose of this
paragraph.

h. (b) If property of a married person is applied to the satisfaction of a money judgment

pursuant to subdivision (a) for a debt incurred by the person that is assigned for
payment by the person's spouse, the person has a right of reimbursement from the
person's spouse to the extent of the property applied, with interest at the legal rate,
and may recover reasonable attorney's fees incurred in enforcing the right of
reimbursement
i. FC § 2602
i. As an additional award or offset against existing property, the court may
award, from a party's share, the amount the court determines to have been
deliberately misappropriated by the party to the exclusion of the interest of
the other party in the community estate.
1. Calculated thievery not mishandling of assets
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ii. Follows that there is a fiduciary for gross mishandling of community

financial affairs
j. Negligent
i.
k. Deliberate mishandling of community property assets
i. Had the court determined that the Husband knew of the small claims court
date and didn’t go and therefore the community incurred a judgement in the
amount in $5,000, then the court would have kept the unequal division
between the parties but because the facts determined it was pure negligence
and not the mishandling the $5000 CP needs to be split evenly
1. Marriage of Shultz 1980
ii. If community has assets that can cover a community debt, the court cannot
adjust the division of debt to reflect equitable considerations
a. Misdirection of a notice of trial and the failure to hire an
attorney does not = gross mishandling
l. FC § 2550
i. Mandates equal division of assets and FC § 2602 states that an exception to
equal division is the court may award from a party’s share, the amount the
court determines to have been deliberately misappropriated by the party to
the exclusion of the interest of the other party in the community estate
m. Two Problems arise at divorce
i. Substantial community property disappears
ii. Inadequate information about the existence or value of CP
n. How to solve
i. Whether there was a duty to account?
ii. Whether there is a duty to disclose?
o. Contractual obligation, Tort, Criminal Penalty
i. Only proper for court’s to make orders which carry out the law’s full intention
that only responsible participants in crime tort bear the loss.
ii. Rule
1. When the community incurs a loss because of contractual obligations,
tort liability, or criminal penalty, then the other spouse should not be
forced to share in the penalty imposed for the contractual obligation,
tort, or criminal penalty and as a matter of equity should receive the
full ½ share of community property but for the forfeiture and should
not be charged against the community.
2. Give her 2602 bc of his forfeiture
a. Marriage of Beltran 1980
iii. Criminal conduct
1. Criminal conduct that causes forfeiture justifies other spouse being
reimbursed
iv. Fraudulent
1. FC §1100(h) Where a spouse conceals assets under circumstances
satisfying the criteria for punitive damages under Civ Code 3294, a
penalty representing 100% is warranted

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a. Court must give 100% of lottery winnings

i. Marriage of Rossi
v. Recognize
1. Tortious conduct and criminal conduct
2. Conduct that benefits the community and conduct that does not
p. Rule
i. The duties of spouses to deal fairly with each other do not terminate when
they separate and obtain a dissolution of their marriage. One spouse cannot,
by invoking a condition wholly within his control, defeat the community
interest of the other spouse. A serviceman’s election of a disability pension in
lieu pf a pension based on length of service does not defeat the community
interest in the pension based on service, now will an employee spouse be
permitted to defeat the other spouse’s community interest in a pension by
converting it to a joint and survivor annuity
1. Cannot make a unilateral decision that strips the other spouse from
their fair ½ interest in the community asset
q. § 2 Responsibility Between Spouses
i. Spouses shall act in good faith and may not be contracted by marital property
agreement,
1. May not take unfair advantage
r. FC § 2040
i. A summons in an action for divorce or annulment contains a temporary
restraining order
ii. (a) In addition to the contents required by Section 412.20 of the Code of Civil
Procedure, the summons shall contain a temporary restraining order:
1. (1) Restraining both parties from removing the minor child or
children of the parties, if any, from the state, or from applying for a
new or replacement passport for the minor child or children, without
the prior written consent of the other party or an order of the court.
a. Cannot move minor children to another state
2. (2) (A) Restraining both parties from transferring, encumbering,
hypothecating, concealing, or in any way disposing of, any
property, real or personal, whether community, quasi-community,
or separate, without the written consent of the other party or an
order of the court, except in the usual course of business or for the
necessities of life, and requiring each party to notify the other party of
proposed extraordinary expenditures at least five business days before
incurring those expenditures and to account to the court for all
extraordinary expenditures made after service of the summons on that
party.
a. Cannot conceal or dispose of any property
3. (B) Notwithstanding subparagraph (A), the restraining order shall not
preclude a party from using community property, quasi-
community property, or the party’s own separate property to pay
reasonable attorney’s fees and costs in order to retain legal counsel

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in the proceeding. A party who uses community property or quasi-

community property to pay the party’s attorney’s retainer for fees and
costs under this provision shall account to the community for the use
of the property. A party who uses other property that is subsequently
determined to be the separate property of the other party to pay the
party’s attorney’s retainer for fees and costs under this provision shall
account to the other party for the use of the property.
a. Does not prevent spouses from the use of their property to
retain counsel
4. (3) Restraining both parties from cashing, borrowing against,
canceling, transferring, disposing of, or changing the beneficiaries of
insurance or other coverage, including life, health, automobile, and
disability, held for the benefit of the parties and their child or children
for whom support may be ordered.
a. Cannot cash out, cancel, transfer insurance, held by the parties
s. Awards
i. Wronged spouse ½ interest of the lost profits = the appreciation of the
securities between the date of sale and the subsequent divorce
t. Debts and Liabilities
i. CP Liability
1. 3 exceptions to division of liabilities
a. Educational loans
i. may be assigned without offset to the spouse who
received the education under FC § 2627 & 2641
b. Tort liability
i. that is not based on an act or omission which occurred
while the married person was performing the activity
for the benefit of the community and outstanding
liability is assigned to the tortfeaser spouse without
offset FC§ 2627
c. community debts shall be assigned as the court deems just and
equitable taking into account factors such as the parties relative
ability to pay
i. FC § 2622(b)
ii. § 2551
1. For the purposes of division and in confirming or assigning the
liabilities of the parties for which the community estate is liable, the
court shall characterize liabilities as separate or community and
confirm or assign them to the parties in accordance with Part 6
(commencing with Section 2620 ).
a. Court will characterize liabilities as separate or community
property and assign to the parties
iii. FC § 2620 Confirmation or division of community estate Debts

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1. The debts for which the community estate is liable which are unpaid
at the time of trial, or for which the community estate becomes liable
after trial, shall be confirmed or divided as provided in this part.
iv. FC § 2621 Debts Incurred Before Marriage
1. Debts incurred by either spouse before the date of marriage shall be
confirmed without offset to the spouse who incurred the debt.
v. FC § 2622 Debts Incurred After Marriage but Before Separation
1. (a) Except as provided in subdivision (b), debts incurred by either
spouse after the date of marriage but before the date of separation shall
be divided as set forth in Sections 2550 to 2552, inclusive, and
Sections2601 to 2604, inclusive.
2. (b) To the extent that community debts exceed total community and
quasi-community assets, the excess of debt shall be assigned as the
court deems just and equitable, taking into account factors such as
the parties' relative ability to pay.
vi. FC § 2623 Debts Incurred After Separation but Before Judgment
1. Debts incurred by either spouse after the date of separation but
before entry of a judgment of dissolution of marriage or legal
separation of the parties shall be confirmed as follows:
a. (a) Debts incurred by either spouse for the common
necessaries of life of either spouse or the necessaries of life
of the children of the marriage for whom support may be
ordered, in the absence of a court order or written agreement
for support or for the payment of these debts, shall be
confirmed to either spouse according to the parties' respective
needs and abilities to pay at the time the debt was incurred.
b. (b) Debts incurred by either spouse for unnecessaries of that
spouse or children of the marriage for whom support may be
ordered shall be confirmed without offset to the spouse who
incurred the debt.
vii. FC § 2624 Debts Incurred After Entry of Judgment
1. Debts incurred by either spouse after entry of a judgment of
dissolution of marriage but before termination of the parties’ marital
status or after entry of a judgment of legal separation of the parties
shall be confirmed without offset to the spouse who incurred the debt.
viii. FC § 2625 Separate Debts
1. Notwithstanding Sections 2620 to 2624 , inclusive, all separate debts,
including those debts incurred by a spouse during marriage and before
the date of separation that were not incurred for the benefit of the
community, shall be confirmed without offset to the spouse who
incurred the debt
ix. FC § 2626 Reimbursement for debts paid after separation but before trial
1. The court has jurisdiction to order reimbursement in cases it deems
appropriate for debts paid after separation but before trial.
XIV. Inception & Termination of Economic Community 447-484 489-513 516-529
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a. Inception and termination of economic community

b. California has 3 requisites for marriage:
i. 1) both parties must have the legal capacity to marry
1. Bigamy and incest make it void
ii. 2) satisfy legal requirements for contracting a marriage
1. Licensed, witnessed, and registered
iii. 3) states agree noncompliance with the legal requirements by someone other
than the parties to a marriage does not render a marriage void however they
vary on parties failure to obtain a license renders a duly formalized ceremonial
union void
c. Lawful Marriage
i. Due Process Clause and Equal Protection Of the 14th amendment require a
state to license a marriage between two people of the same sex and to
recognize a marriage between two people of the same sex when their marriage
was lawfully licensed and performed out-of-state.
1. The right to marry is a fundamental right inherent in the liberty of the
person, and under the Due Process Clause and Equal Protection
Clauses of the 14th amendment couples of the same-sex may not be
deprived of that right and that liberty
a. Obergefell v. Hodges 2015
2. Principals:
a. 1) right of personal choice regarding marriage is inherent in the
right to individual autonomy
b. 2) supports a two-person union unlike any other in its
importance to the committed individuals
c. 3) safeguards children and families and draws meaning from
related rights of childrearing, procreation, and education
d. 4) marriage is a keystone of our social order
d. Putative Spouses – Totality of the circumstances – reasonableness
i. FC § 2201 A subsequent marriage contracted by a person during the life of his
or her former spouse, with a person other than the former spouse, is illegal and
void unless the subsequent marriage has been dissolved.
ii. When parties attempt to contract a lawful marriage and one or both maintain a
good faith belief that the marriage is valid
1. Lasts as long as the good faith belief
2. Redability is judged by the court
iii. Rule - Spouse
1. An innocent participant who has duly solemnized a matrimonial union
which is void because of some legal infirmity acquires the status of
putative spouse
a. A woman who marries in the good-faith belief that her husband
was divorced from his first wife is judged on credibility by the
trial court, and curt acceptance of her testimony established her
status as a putative spouse
i. Estate of Vargas 1974

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1. Court considers all evidence shedding light on

the person’s belief in the validity of the
marriage
2. Two justifications:
a. 1) Quasi-marital property equates property rights acquired
during a putative marriage with CP rights acquired during a
legal marriage
i. Codified in FC § 2251 when a determination has been
made that one party or either party believed in good
faith that the marriage was valid, the court shall declare
that spouse a putative spouse and if CP is at issue, the
court shall divide in accordance with FC § 2250 that
property acquired during the union would have been
community property if the union had not been void or
voidable. Such Property will be called quasi-marital
property.
ii. Only upon request of the putative spouse
b. 2) treats the putative marriage as a partnership
i. The innocent putative spouse was in a partnership or a
joint enterprise with her spouse contributing her
services/earnings to the common enterprise
ii. Thus, accumulated property was in effect in tenancy in
common in equal shares. Upon death, only his half-
interest is considered CP, to which the rights of the
lawful spouse attach
c. Special Circumstances
i. In order to meet the requirements of every case, and to
satisfy the needs of progressive social condition, in
which new primary rights and duties are constantly
rising, and new kinds of wrongs are constantly
committed
iv. Equity will assert itself in situations were right and justice would be defeated
but for its intervention Putative Spouse
1. The surviving spouse of a void or voidable marriage who is found by
the court to believe in good faith, that the marriage to the decedent was
valid. The good faith on inquiry was a subjective one that focuses on
the actual state of mind
v. Subjective
1. Good faith in inquiry for determination of a putative spouses is based
on the spouse’s genuine and honest belief in the validity of the
marriage
a. Ceja v. Rudolph 2013
2. Look to:
a. Whether efforts were made to create a valid marriage

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b. Whether the party was ignorant of the infirmity rendering the

marriage void or voidable
c. Prior marriage or divorce either supports or undercut a good
faith claim, depending on the totality of the circumstances
i. Reasonableness is examined with the totality of the
circumstances
1. Any knowledge their marriage was not valid
3. Policy
a. Protect the expectations of innocent parties and to achieve
results that are equitable, fair, and just
vi. Example of May be a quasi-marital owner of interest in a surviving
spouse’s benefit
1. A good faith belief that California domestic partnership had been
validly registered entitled him to the rights and benefits of marriage as
a putative domestic partner, even though declaration had never been
registered
a. In Domestic Partnership of Ellis and Arriaga 2008
2. The End of the Economic Community
a. If marriage ends with death, community ceases at the time of
death, the surviving continues to own his/her interest n the CP
property and the decedent’s property passes by will or intestacy
b. § 771 earnings and accumulation of the spouse, while living
separate from the other spouse, are the separate property of
the spouse
i. that condition when spouses have come to a parting of
the ways with no present intention of resuming marital
relations
3. Davis Applies - Creates an island from January 2015- 2017
Marriage of Davis if dissolution was filed during that time
a. If parties separated and filed for divorce, Marriage of Davis
apply, therefore there would not be a date of separation until
the two parties moved out of the same home
1. Marriage of Davis 2015 NOT GOOD LAW
2. It is clear that the legislature intended the
statutory phrase of living separate and apart to
require both
I. 1) separate residences and
II. 2) at least one spouse having the
subjective intent to end the marital
relationship, which intent is objectively
evidenced by words and conduct
reflecting that there is a complete and
vii. § 70 the date of separation the date that there is a complete and final break as
evidenced by both of the following:
1. 1) the spouse has expressed his intention to do so

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2. 2) the conduct of the spouse is consistent with their intent to end the
marriage
a. In determining the date of separation, the court will take into
count all of the evidence
XV. Division of Assets & Liabilities/Quasi-CP/Federal Presumption 635-675
a. Two questions with choice of Law
i. 1) Which law determines title
ii. 2) which law determines property distribution?
b. To determine, court looks to:
i. 1) law of the place where the marriage took place and ignore subsequent
moves on the theory that the parties at marriage and ignore subsequent moves
on the theory that the parties at marriage contracted for whatever statutory
scheme the jurisdiction provides
ii. 2) look to the law where the parties were domiciled at the time that the
particular asset was acquired
iii. 3) law of jurisdiction to where parties are domiciled at the dissolution of the
marriage
c. Out of State Property Acquired by California Domiciliary
i. A court in one state lacks jurisdiction into alter title to land in another state. In
rem jurisdiction required.
d. Administration of a California Decedent’s Out-of-State Assets: Jurisdiction and
Choice of Law
i. A decedent’s assets may be subject to judicially supervised administration as
many states as they are located
1. Domiciliary administration occurs in the state in which the decedent
was domiciled at death
e. Californian’s Out-of-State Realty at divorce
i. FC § 760 CP
1. Except as otherwise provided by statute, all property, real or personal,
wherever situated, acquired by a married person during the marriage
while domiciled in this state is community property
ii. FC § 2660
1. (a) Except as provided in subdivision (b), if the property subject to
division includes real property situated in another state, the court shall,
if possible, divide the community property and quasi-community
property as provided for in this division in such a manner that it is not
necessary to change the nature of the interests held in the real property
situated in the other state.
2. (b) If it is not possible to divide the property in the manner provided
for in subdivision (a), the court may do any of the following in order to
affect a division of the property as provided for in this division:
a. (1) Require the parties to execute conveyances or take other
actions with respect to the real property situated in the other
state as are necessary

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b. (2) Award to the party who would have been benefited by the

conveyances or other actions the money value of the interest in
the property that the party would have received if the
conveyances had been executed or other actions taken.

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