Marital Property
Introduction
Reading of Statutes:
1) plain meaning of words
2) legislative history
a. sometimes not helpful – people might not be saying yes for the same reasons
3) comments
4) look at other parts of the Act to interpret
5) Case law
p. 729 – Family code
Marital property law: property rights of persons married to each other, married persons and 3rd persons.
Review:
Mon. 5/12 2pm DH
Tues 5/13 2pm DH
OH
Mon 4/28 3-5pm
Tues 5/13 4-6 pm
Weds 5/14 1-4 pm
Fischer v. Worth (1971), p. 13
Married for over 30 years. First 2/3 of marriage: income was pooled to pay for expenses. At 22 years: wife – household expenses; husband – saving and investments;
Property at issue: savings & investment, retirement funds, house, life insurance (everything is in his name). For the house: husband probably paid for down payment, but payments probably came from wife.
Court: husband gets everything. Without marital property law, title controls.
2 types of marital property schemes
1) Common law (rest of states)
a. Joint ownership only by express intent
b. Equitable distribution standard for distributions
i. More flexibility and variability
c. Marital property is only recognized at divorce
d. Definition of marital property
i. Hotchpot approach (minority): everything the spouses own goes into the pot and deemed marital property
ii. Majority approach: distinguishes between marital property and non-marital property (when was the property acquired? Before or after marriage?)
2) Community Property Law (adopted by 8 states + Wisconsin)
a. Joint ownership assumed – Assumed to be community property
b. Equal division mandate in 3 states (50/50)
i. Equitable distribution standard in 5 states
c. Marital property applies throughout marriage
d. California’s definition of marital property
i. Community property (§760) – similar to common law in the sense that it asks if property is acquired during marriage; but there are exceptions à Ask: When AND How (exception: §770 – gift, bequest, devise, or descent)
ii. Separate property (§770) –
Hypo:
Sue owns apartment building, marries Sol à under majority common law à apartment is non-marital property
Income from the apartment à marital property
Under California:
Distinction between community and separate property is: labor (time, energy and effort) vs. gratuitous/passive income
Painter v. Painter (1974), p. 15
Background: before 1971: only 2 grounds for divorce are cruelty and adultery. CA in 1971 started with no-fault grounds for divorce.
Trial court: excluded the property that was acquired by gift; what is left is marital property. 2 pools.
Error: the trial court asked HOW it was acquired. It should not matter HOW, just WHEN (NJ doesn’t have a community property law)
Equitable distribution standard: provide a list of factors to take into account when distribution is being made. (p. 19) purpose:
1) financial need/ contribution
2) preventing hardship
3) widely disparate standard of living between custodial parent and non-custodial parent
purpose of 50/50 division
1) spouse are equal so everything should be divided equally
2) marriage is an equal partnership à so property rights and responsibilities should reflect that.
3) This is just about property rights, not about spousal support.
Transmutation: K’s and Gifts
Ability to bypass community property laws.
Times to do this:
1) Prema
te property.
Court: Premarital agreement upheld.
1) Enforcement of the state policy to foster and protect marriage does not require the invalidation of entire agreements based upon the subjective contemplation of the parties; it requires only that the courts refuse to enforce specific contractual provisions which by their terms seek to promote the dissolution of a marriage (e.g., a wife’s waiver of support rights promotes divorce, but contracted property divisions do not)
2) Antenuptial agreements dealing with property owned prior to marriage and property and earnings accumulated subsequent to marriage are generally valid.
At time of divorce, 4 children (her child from previous relationship, his 2 children from previous relationship + unborn child);
Agmt provides for support for her children and herself, and provides for separate property (itemizes what is separate property at the commencement of marriage); purpose of K: everything is going to be separate property.
Betty Johnson’s argument: this was not entered into in contemplation of a marriage to last until death.
In absence of a premarital agreement: James’ house might be community property (because her income might have been used to pay for the mortgage). But the premarital agreement provides that James would get the house.
Court: this does not promote divorce.
1) he keeps his property whether he is married or divorced à no incentive to get divorced
Court: you don’t have a confidential relationship in a premarital setting + no duress à no undue influence (other factors: bad
