COMMUNITY PROPERTY OUTLINE-Summer 2012-Garrison Klueck
SUB-THEMES OF COURSE
-Over time, Cali CP became less oppressive to women
-No fault divorce in 1970
-Men had complete control and management of cp, as well as his own sp. Men could give away CP without wife’s consent. Over time, women gained equal management and control over CP.
-In 1975-Women gained equal management and control of CP
-During 1975-1981-numerous major landmark California Supreme Court cases (Marvin, Dawley, Brown, Lucas, Moore)
California Community Property
DEFINITION: CP comes from labor performed while a person is living together as husband and wife (source of CP)
Note:
-Any compensation paid as a result of that labor is also CP (not just paid, but deferred payments like pensions, 401K, stock options)
-Any assets acquired are CP as well as any debts
-When separated (no longer living together)-it no longer is CP-it is Separate Property
-771-once separated you are acquiring separate property not community property. In Cali, do not have to be divorced –just separated (not living together)
-It must communicated to the other spouse on intention of separating
STATES THAT FOLLOW CP
-8 classic CP states-all former colonies of Spain and France (AZ, NM, Nevada, Texas, CALI; Louisiana Purchase-Louisiana, Washington, Idaho
-California is a minority state-not many states have CP rules
-If not classic CP state then all property acquired until divorce is community property. Need to get divorced to start acquiring separate property.
-Only two states follow California rules about separate property-once separated then property acquired is separate property and not community property; The other five states follow Texas CP rules
-The rest of States follow Common Law.
-Community Prop is derived by labor while married; if its not labor and it’s a gift or inheritance then it is not community prop.
PRENUPTIALS and TRANSMUTATION
General Rule: Prenuptials/Premarital Agreements are enforceable except in extreme cases or if the agreement promotes divorce
Low divorce rate until late 60’s/early 70’s
-Consistent-public policy-encourage marriage, discourage divorce
-Late 70’s and Beyond
-Greater recognition of prenupts
· In Re: Marriage of Dawley (1976)-Sophisticated parties can bargain and courts will permit (husband was a professional and wife was schoolteacher);
· Same year and court as Marvin (non-married cohabitants can contract)
· But—de facto “bribes” to get divorced not allowed-IRMO Noghrey (1985) Cal. App. 3rd 328-Promise for H to pay $500K and house to wife-much of an incentive to divorce
-UPAA (Proposed 1983-Cal Enacted 1984-effective 1/1/85
Discussion of uniform codes (contrast with Federal and State statutes)
-Two “giant” Cal Supreme Ct Pronouncements on Prenupts
IRMO Bonds (2000)-signed with no attorney, on the airplane
IRMO Pendleton-spousal support waiver was valid. They are not per se unenforceable. Both parties were professionals.
Note:
-Prenupts must be signed voluntarily
-Can opt-out of community property; also can have spousal support waiver so long as it’s not unconscionable at time of divorce or one of the parties did not have independent counsel
UPAA and CPAA
-Originally, there was no spousal support waiver included in the CPAA
Family Code 1612 (Amended in 2001 in response to Pendleton)-Cannot waiver spousal support waiver if both parties did not have independent counsel or it was u
xpressed, and it must be signed by the adversely affected spouse (consented, accepted, joined).
-Express is the main issue: How expressed does it have to be? Expressly state that party is effecting a change in the character or ownership
Estate of McDonald-Must state intent to transmute or change character
Estate of Bibb-standard DMV registration form not enough-need to show or express more
Benson Case-Husbands transmute pension to CP, wife does not change property ownership to CP—Court do not recognize “oral agreement”
TRACING
Section 760-Community Property-created by labor while living together as husband and wife
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
The basic characterization of an asset is set at time of acquisition
Tracing means putting the process in reverse, in a divorce of Probate case, to say—the presently existing car is CP because the cash was Cp and the cash was CP because the house was CP. The characterization of an asset is “traced” back to its characterization at its acquisition.
Section 770-Separate Property of Married Person
(a) Separate property of a married person includes all of the following:
(b) A married person may, without the consent of the person’s spouse, convey the person’s separate property.
