Community Property

P. 1-82

Development of
1. 721. Contracts w/ each other; fiduciary relationship a. A husband and wife are subject to the eneral rules o!ernin fiduciary relationships which control their confidential relations. "#poses a duty of hi hest ood faith and dair dealin $ and cannot ta%e unfair ad!anta e of each other. 2. &aynard ! 'ill (parties wish for a di!orce) a. &arria e is *+, a b. &arria e is a relation with ri hts$ duties$ and obli ation i#puted by the law c. Cannot be dissol!ed by #ere #utual consent li%e other -s$ 1. &arital Property o!er!iew 1. Co##unity Property i. .ees spouses as separate le al persons while the #arria e was re arded as an econ patenership under the husband/s #ana e#ent. ii. 0ach spouse is dee#ed a co owner of property ac1uired durin #arria e$ re ardless of the !alue of his or her actual contributions to the ac1uisition iii. All assets owned by #arried person are either classified as 1. Co##unity a. Any other assets ac1uired durin #arria e i. +wned e1ually by both spouses 2. .eparate a. Property owned prior to #arria e and property ac1uired by ift or inheritance 2. 2 Principles underlyin the CA Co## prop syste# 1. Tracing Principle 3 property ac1uisitions are traced bac% to their ori inal source i. 760 Community Property Defined 1. All real or personal property$ where!er situated$ ac1uired by a #arried person durin the #arria e when do#iciled in this state is co##unity property. ii. 4775 .eparate property of #arried person 1. .eparate property of a #arried person includes all of the followin 2. All property owned by the person before #arria e 2. All property ac1uired by the person after #arria e by ift$ be1uest$ de!ise or descent 6. ,he rents$ issues and profits of the property described in this section 7. A #arried person #ay without the consent of the persons spouse con!ey the persons separate property iii. 8eor e ! 9anso# (whether proceeds or di!idends of the separate estate of wife #ay be used by husband to satisfy debts - *+)

1. :ruits of separate property are traced to the source and classified accordin ly a. "ncludin proceeds fro# sale or e;chan e of a separate property asset$ rents$ profits$ other for# of inco#e deri!ed$ etc b. Applies also to the co##unity property 2. Equality Interests 3 ie. that co##. Prop is fa#ily property in which both spouses ha!e e1ual interests i. Code 71 p !6 ii. .tewart ! .tewart 1. 'usband is able to use co# prop to satisfy debtor and wife can only contest if he is tryin to defraud her. 2. Contractual "odification 3 that #arried persons #ay #odify operation of the co##. Prop syste# by inter spousal a ree#ents i. Ability to a ree what will be co##unity/separate e!en if its not traced as such 1. Proble#s arise with de ree of for#ality re1/d for !alidity ii. Code p22 iii. &arria e of *o hrey (pre#arital a ree#ent !alid<) 1. Antenuptial -s which facilitate di!orce or separation by pro!idin for a settle#tn only in the e!ent of such an occurrence are !oid as a inst public policy a. 0;ceptions 3 when they deal with prior owned prop and earnin s subse1uent i. Cannot encoura e di!orce i!. &arria e of =onds (=arry =onds prenuptial a ree#ent) :or =onds 1. Prenups can only be dissol!ed in e!ent of in!oluntariness or unconscionability a. in!oluntary i. 3!oluntary 3 done by desi n; intentional and without coercion ii. Cannot !iew !oluntariness on assu#ption that the parties were in a confidential relationship and in pursuit of policy fa!orin e1ual di!ision of assets upon dissolution 1. *ot your re ular -$ and not analo ous to #arria e settle#ent iii. :ound the a ree#ent !alid and !oluntary b. unconscionable i. when the - was unconscionable and that he or she did not ha!e actual or constructi!e %nowled e of the assets and obli ations of the other party and did not !oluntarily wai!e such %nowled e 2. =>9?0* of proof 3 preponderance of e!idence on wife clai#in 2. *o fiduciary duty owed durin prenups

!. *otes@ *ow$ >P&A pro!ides that pre#arital a ree#ent is not e;ecuted !oluntarily if the party a ainst who# enforce#ent is sou ht was not represented by independent le al counsel at si nin or wai!ed it. !i. &arria e of =ur%le #Aife filed for dissolution$ assertin in!alidity of post#arital a ree#ent pre!iously e;ecuted by the parties. ,his ar u#ent is based on undue influence and i!in an ad!anta e to ? husband) 1. ,he settle#ent a!e P wife half of the co##. Prop at the ti#e$ fi;in it at B25 #ill in addition to #aintenance #oney 2. "/' 1@ ,here was no undue influence bc there was no unfair ad!anta e and so burden of proof oes to P Aife a. :a#ily code 721@ i. "#poses a confidential reltionsip ii. *either shall ta%e an unfair ad!anta e of the other 1. "f there is an ad!anta e$ the ad!anta ed party bears the burden of de#onstratin that the a ree#ent was not obtained thru undue influence b. ,o deter#ine whether there was an unfair ad!anta e obtained by undue influence i. ,he court rejects idea that if one spouse ains an ad!anta e then the presu#ption of undue influence arises ii. *ot just an ad!anta e$ has to be an unfair one 1. &ust operate to disad!anta e another iii. .hould establish that the wron ful spouse #ade use of the confidence reposed for the purpose of ainin an unreasonable ad!anta e o!er the #ate i!. Case precedent shows that there is a presu#ption of undue influence when@ one spouse deed interest in co##. Prop to other spouse for no/inade1uate consideration !. CCconclusion 3 in a contractual e;chan e b/w spouses$ a presu#ption of undue influence arises only if one of the spouses has obtained an unfair ad!anta e o!er the other. c. Application@ there was not an unfair ad!anta e when@ i. ,he a ree#ent pro!ided #utual ad!anta es ii. ,he spouses are repped by sophisticated counsel$ and where the spouses e;pressly ac%nowled e that neither has obtained an unfair ad!anta e 2. "/' 2@ "f there is no e!idence to brea% the presu#ption of undue influence$ then the appellate #ay not disturb the trial courts findin s as such and re!erse the presu#ption a. ,his presu#ption is not re!ersible error b. ,here was no e!idence to indicate such $. %ormalities

i. 0state of =ibb (P denies !alidity of trans#utation of his father/s property by deed and car by re istration to his second wife fro# separate prop to co##. Prop as joint tenants) 1. :a#ily Code section 872 a. A trans#utation of real or personal property is not !alid unless #ade in writin by an e;press declaration that is #ade$ joined in$ consented to$ or accepted by the spouse whose interest in the property is ad!ersely affected 2. ,he real property 3 Des$ !alid trans#utation. a. Precedent fro# &c?onald Case p 71 i. Ee islati!e history indicates that an e;press writin re1uires 1. Aords indicatin an intent to transfer the interest 2. ,he court can deter#ine on the face of the writin $ i norin e;trinsic e!idence$ to deter#ine whether its writer intended to create a joint tenancy 2. ,hat it is not an e;press declaration unless it contains lan ua e which e;pressly states that the characteriFation or ownership of the property is bein chan ed. a. "e G" i!e to the account holder any interest " ha!eH b. 9ule@ 9e1uire#ents are@ i. 1) a writin that satisfies the .o: ii. 2) an e;pression of intent to transfer the property interest c. Application@ i. 'ere$ the deed says G rantH$ which is ade1uate 2. ,he car a. Iehicle code JJ2 says that re istration in two na#es is enou h to presu#e a trans#utation i. .upre#e Court has rejected this. :a#ily Code 872 still tru#ps and is not ne ated b. Application@ i. 1) consent@ *o$ there is no e!idence of consent by husband as the ad!ersely affected party ii. "ntent@ *o$ there is not a clear and una#bi uous e;pression of 0!erett/s intent to transfer his interest in the subject property c. Co##in lin of funds to pay for the car here was irrele!ant ii. &arria e of .teinber er ('usband clai#s rin he a!e his wife as co##unity property$ wife contests it as a ift and jewelry as e;e#pt fro# code 872)

1. Public policy re1uires the for#ality of a writin in order to deter fraud a. :a# Code 872@ that if a ift between spouses consists of a substantial asset$ it is not oin to be a ift unless there is a written e;pressed declaration trans#utin the property fro# co##unity to separate i. ,hus$ the rin is co##. Prop bc there was no written declration ii. +ther non substantial ifts li%e appliances$ clothes$ jewelry etc are dee#ed seprate prop pp. 82-128

The Classification of Property as Community or Separate

1. .i nificance of classification a. "t is a critical deter#ination due to the conse1uences which flow fro# such. 2. Process a. "s it in the scope of the co##. Prop syste#< b. Aas it ac1uired durin or before #rr < i. 8ift$ inheritance or testa#entary< 3 separate 2. Ailson ! Ailson (P husband denies house bou ht durin #arria e as co##. Prop) a. 9ule@ All prop ac1uired after #arria e is co##. Prop i. ,his is a rebuttable presu#ption ii. ,he burden is on the party assertin the separate character of the property and that the presu#ption applies when the one clai#in tht the prop is co# offers e!idence that the prop was ac1uired after #arr 6. 9ebuttal of the 8eneral presu#ption by ,racin 7. &arria e of 0ttefa h (P Aife contest use of 1uantu# of e!idence 3 preponderance of e!idence in deter#inin classification of prop 3 instead de#ands clear and con!incin ) a. Court refuses as there is no law/pro!ision re1uirin such i. Preponderance is the default standard of proof in ci!il actions in this state b. :urther$ policy considerations considers that preponderance is ade1uate i. Parties share the ris% e1ually$ and only #oney is at sta%e J. *otes a. :a# Code 775. .eparate Prop of #arried person b. :a# Code 771. 0arnin s and accu#ulations durin period of separation c. :a# Code 772. 0arnin s or accu#ulations after entry of jud #ent of le al separation 7. 0state of Clar% (?illard/s son died without lea!in hi# property in his will$ he contested is and it was declared a !alid will$ he appealed and they settled i!in hi# so#e interest$ he ets #arried$ he dies and wife clai#s it as co##. Prop) a. "t is true that the property in liti ation was ac1uired durin the ti#e he was #arried$ but it was ac1uired by way of the co#pro#ise of a statutory ri ht which was in itself property and which he owned prior to his #arria e. Property ac1uired by co#pro#ise is separate property if the ri ht co#pro#ise is separate. 8. ?owner ! =ra#et ('usband recei!ed 1/2 interest in ranch after di!orce for reco#pensation of ser!ices durin e#ploy#ent; wife clai#s as co##. prop)

a. Parties settled 3 warranty said that any future prop not #entioned that was co##. Prop would be i!en b. =oss testified the deedin of ranch as a ift i. Court a rees it is a ift as there was no consideration on the part of the boss to offer the interest- the e#ploy#ent ser!ices had already been rendered 3 thus there was no induce#ent on the part of the husband to stay in e#ploy nor any le al obli ation of boss to i!e it c. 'owe!er$ :a# code 775 i. 0arnin s or prop attributable to or ac1uired as a result of the labor$ s%ill$ and effort of a spouse durin #arria e are co##. Prop ii. ,here is e!idence that the ift was #ade by for#er husbands e#ployer reco nition of for#er husbands de!oted ser!ices 1. ,hey ne!er interacted socially d. 'oldin @ ,hus$ althou h the con!eyance of the interest was in the for# of a ift$ the e!idence supports that this was a re#uneratory ift for ser!ices$ to the e;tent that it was render durin #arria e the interest is co##. Prop. K. &arria e of &anfer (Aife contests date of separation as day when they #o!ed out and split; husband says it is when the di!orce papers were filed) a. ,he date of separation occurs when either of the parties does not intend to resu#e the #arria e and his or her actions bespea% the finality of the #arital relationship. ,here #ust be proble#s that ha!e so i#paired the #arria e relationship that the le iti#ate objects of #atri#ony ha!e been destroyed and there is no reasonable possibility of eli#inatin $ correctin $ or resol!in these proble#s b. Contrast fro# =ara ry in which the husband li!ed a double life and still #aintained connection with his fa# 3 not a split 15. .pecial Presu#ptions =ased on the :or# of title Ac1uisitions based on a &arried Ao#an a. .eparate property e!en when #arried wo#an if by an instru#ent in writin before Lan 1$ 1K77 b. :a# Code 4852 Property ac1uired by #arried wo#an before Lan 1$ 1K77 conclusi!eness of presu#ptions (p112) c. 'ors#an ! &aden (husband and wife separate$ and husband dies. Aife clai#s husband ifted her with properties as separate prop) i. Court says that so lon as there is so#e e!idence that there was no intention on the part of the husband to #a%e a ift or to chan e the status of the property was all that would ha!e been re1uired to sustain a findin . d. &arria e of Ashodian (husband didn/t want to be bothered by wife/s purchase and sale of properties$ so she did it on her own with co##. :un prior to 1K76$ she now clai#s this as separate property) i. :a# Code 852 in!o%ed 1. A rebuttable presu#ption a. =urden on husband to pro!e that ownership interests are co##. Prop by a preponderance of e!idence 2. Public policy 3 to protect a #arried wo#an/s title to property in her own na#e when the husband had e;clusi!e #ana e#ent and

control of the spouse/s co##. Propr prior to 1K77. Ahen joint #ana e#ent was i!en to wife in 1K77 this was abolished. ii. :actors to deter#ine whether or not it is co##. Prop (#ore yes/s Mbetter) 1. Eac% of a ree#ent between husband and wife to trans#ute co##. Prop in seprate prop 2. 'usband had no intent to #a%e a ift of separate or co##. Prop to wife 2. Aife used co##. Prop funds to purchase property in her own na#e with husband/s %nowled e but he intended no ift 6. Aife used co##. Prop funds to purchase property in her own na#e without husband/s %nowled e iii. 'oldin @ A wife #ay use her co##. Property earnin s to purchase real estate in her own na#e prior to 1K77 and then in!o%e a presu#ption that the property belon s to her alone. 1. ,he husbands intended a ift by Gabandonin H wide to practice real estate Concurrent 0states e. :a# Code 4775. &ethods of holdin property p122 i. A husband and wife #ay hold property as join tenants or tenants in co##on or as co##unity propery$ or as co##unity property with a ri ht of sur!i!orship. f. &ost property is held as a joint tenancy i. Popular bc the property passes by operation of law to the sur!i!or$ without the necessity of probate ad#inistration 1. Also$ bc bro%ers fre1uently reco##end it . CA courts ha!e dee#ed that a joint tenancy and co##unity prop cannot co-e;ist h. .ection 2781 i. Property ac1uired by the parties durin #arria e in any joint for# is presu#ed to be co##unity property for the purpose of di!ision at dissolution 1. &ay only be rebutted by a clear state#ent in the title docs that the property is separate or by proof of a written a ree#ent i. Luly 1$ 2551 CA Ci! Code J82.1 i. Allows co##. Prop with ri ht of sur!i!orship ii. A hybrid title j. 0state of Ee!ine ('usband secretly hoped to %eep property as both co##. Prop and joint tenancy and didn/t tell his wife; at his death his will dee#ed it as joint tenancy and son fi hts it as co##. Prop) i. "f there is not e!idence that the husband co##unicated an intention to hold it as co##. Prop then he cannot rebut the presu#ption %. &arria e of Eucas (Couple bou ht house$ title was ta%en in joint tenancy; wife paid part of it with separate trust funds and the rest was co##unity funds.) :or ? i. "@ Ahat is the proper #ethod of deter#inin separate and co##unity property interests in a sin le fa#ily dwellin ac1uired durin the #arria e with both separate property and co##unity property funds. ii. :irst$ loo% at the nature of title ta%en by the parties

1. 'ere$ joint tenancy 2. &odern rule@ Ahen a sin le fa#ily residence of a husband and wife is ac1uired by the# durin #arria e as joint tenants$ the presu#ption is that such sin le fa#ily residence is the co##. Prop of said husband and wife. a. (this rule was #ade in consideration of the fact that #ost spouse too% title in joint tenancy without really understandin what it #eant) b. An affir#ati!e act of specifyin a for# of ownership in the con!eyance of title re#o!es the eneral presu#ption c. Policy 3 to lessen unfairness to spouse who hasn/t #ade separate prop contribution. d. >nless the latter %nows that the spouse contributin separate funds e;pects to be rei#bursed or to ac1uire a separate property interest$ there is not a joint tenancy iii. Court will follow Trantafello holdin that the residence was entirely co##unity in nature in the absence of any e!idence of an a ree#ent or understandin between the parties to the contrary. 1. Application$ there is no e!idence as such here. i!. A party who uses his separate prop for co##. Purposes is entitled to rei#burse#ent fro# the co##unity or separate prop of the other only if there is an a ree#ent between the parties to that effect 1. +therwise$ this is a ift to the co##unity !. "f there is e!idence to show such a ree#ent of an intention to retain separate prop interest 1. :ollow Aufmuth 3 sche#e of pro rata apportion#ent of the e1uity appreciation between the separate and co##. Prop contributions to the purchase price l. :a#ily Code 2785 #. :a#ily Code 2781 n. :a#ily Code 2J65 P.12K-182

Ch 3 Limitations on the Classification Process

Property &it'in t'e system a. Certain relationships of econo#ic !alue are re#o!ed fro# the co##. Prop syste i. "e. ,he !alue of profession education ac1uired by a spouse durin #arria e; earnin s durin separation; personal injury da#a es; cant use co##. Prop earnin s to satisfy pre#arital debts$ etc ii. Iersus the fact that the professional practice itself$ includrin the oodwill ele#ent$ is included b. Court cannot di!ide the none;istent i. =ut can still di!ide the i#practicable$ difficult 2. ,odd ! ,odd (Aife clai#s husband/s law education and de ree as co##. Prop) :or ?/' a. "ssues@

2. 6. 7.

J.

i. Aas P entitled to an award based upon the !alue of the husband/s education< ii. "n di!idin the co##. Prop$ did the court i#properly !alue the husband/s law practice< b. "ssue 1 3 the education i. Court finds the education of such a character that a #onetary !alue for di!ision with the other spouse cannot be placed upon it. 1. "t is an intan ible prop ri ht at best ii. Franklin v Franklin personal injury da#a es are not considered co##. Prop and held such for ri ht to practice professions too c. "ssue 2 3 ,he law practice i. ,he !alue of the practice at the ti#e of dissolution of the co##unity is co##. Prop Franklin ii. Brawman v Brawman 3 A prof practice oes auto#atically to the spouse licensed to practice if. 1. 0ffectually$ it is the case of a silent partner withdrawin fro# a oin business. And if such partner is to recei!e fair co#pensation for her share it should be so e!aluated. :a#ily Code 2J27 :a#ily Code 2J61 &arria e of Aatt (Aife clai#s spousal support and rei#burse#ent for her support durin husband/s #edical education) :or P$ a ainst P a. .pousal .upport i. Court finds spousal support is warranted when the wor%in spouse pro!ided a far reater share of li!in e;penses while the student spouse ac1uired a professional de ree. ii. CE9C .ection 6851 re1uires the court to consider the totality of the nonstudent/s contributions and efforts toward attain#ent of that de ree$ includin contributions for ordinary li!in e;penses. b. 9ei#burse#ent for contribution to education i. CE9N co##ent to 6855.2 allows for rei#burse#ent of co##. 0;penditures for educational purposes that ha!e benefited pri#arily one party to the #arria e 1. ,hese e;penditures include tuition$ fees$ boo%s$ supplies$ and transportation ii. Court does not find P ha!in paid for any e;penditures and thus rejects rei#burse#ent and rejects ar u#ent of #ed de ree as co##. Prop &arria e of 8raha# (Aife wants rei#burse#ent to co##. :unds spent on husband/s le al education which was not yet co#plete) :or '$ ? a. :a#ily Code .ection 2J61 i. ,he co##unity shall be rei#bursed for co##unity contributions to education trainin that substantially enhances his earnin capacity ii. E9C co##ent pro!ides that it #ust be de#onstrated tha the education or trainin enhance earnin capacity b. Court found the !alue of enhance#ent too speculati!e as it was not shown whether he would raduate or pursue a career in law.

7. &arria e of &c,iernan O ?ubrow (Aife clai#s oodwill of 'usband/s business as co##. Prop) :or ?/'usband a. 8oodwill of a person is not transferable nor sellable and thus has no !alue on the #ar%et b. Ahile oodwill of a business is transferable$ here it was oodwill of husband as a #o!ie director and not a business. i. 'e cannot e;pand bc it is his own talent to offer ii. &edical practice could ha!e oodwill 8. &arria e of .pen ler (Aife clai#s husband/s life insurance proceeds as co##. Prop$ he died after they dissol!ed) a. "n the absence of a ri ht by the insured spouse to enforce the potential !alue of a renewal ri ht$ the renewal ri ht is not property within the #eanin of the co##unity property laws. Persons (it'in t'e )ystem b. 9e1uire#ent of a !alid #arria e or re istered do#estic partnership i. .a#e se; unions 1. =roadened to include this 2. 2 approaches a. =roadened scope of #arria e institution to include person of the sa#e se; b. ?e!elop#ent of an analo ous status$ such as ci!il unions or do#estic partnerships 3 has pro!en #ore successful 2. CA :a# Code 4255 a. &arria e is a personal relation arisin out of a ci!il contract between a #an and a wo#an to which the consent of the parties capable of #a%in that contract is necessary 6. CA :a# Code 4258.7 a. +nly a #arria e between a #an and a wo#an is !alid or reco niFed in California. 7. .an :rancisco liti ation for sa#e se; #arria es a. Atte#pt to o!erturn these codes. .upre#e Court re!iew pendin J. ?o#estic Partner le islation a. 0nact#ent of G9e istered ?o#estic PartnershipH statutes in 1KKK. b. CA beca#e one of the first states to allow cohabitin adults of the sa#e se; to establish a Gdo#estic partnershipH c. .tren thened by the CA ?o#estic Partner 9i hts and 9esponsibilities Act d. CA :a# Code 2K7.J i. 9e istered do#estic partners shall ha!e the sa#e ri hts protections and benefits$ and shall be subject to the sa#e responsibilities$ obli ations and duties under law PQR as are ranted to and i#posed upon spouses.

7. CA :a# Code 42K7. ?o#estic Partners and partnership; establish#ent 8. CA :a# Code 42K7.7. 9i hts$ protections and benefits; responsibilities; obli ations and duties under law; date of re istration as e1ui!alent of date and #arria e K. CA :a# Code 42K8.7. :ilin of ?o#estic Patnership for#s; re istration 15. CA :a# Code 42KK. ,er#ination of re istered do#estic partnership; filin of *otice of ,er#ination of ?o#estic Partnership; conditions; effecti!e date; settin aside ter#ination; jurisdiction 11. CA :a# Code 42KK.2 9eco niFin sa#e se; unions fro# another jurisdiction as a !alid do#estic partnership 12. CA :a# Code 42KK.2 Eetter to be sent each re istered do#estic partner fro# .ecretary of .tate; notice to potential do#estic partner re istrants c. &arria e Cases i. "@ Ahether :a# Code pro!isions li#itin #arria e as b/w #an and a wo#an !iolate their funda#ental ri ht to #arry under the due process and e1ual protection clauses of the CA Constitution$ and discri#inate a ainst the# on the basis of ender and se;ual orientation in !iolation of the e1ual protection clause$ their constitutional ri hts to pri!acy$ and freedo# of e;pression and association. ii. No Fundamental Right to Marriage Between Same sex Partners Has Been Recogni ed 1. ,he idea@ Cannot co#pare sa#e se; #arria e as a ri ht ha!in been reco niFed as G#arria eH itself$ ha!e to #ore narrowly define the ri ht 3 it is not just #arria e but sa#e se; #arria e 2. Cannot e;pand the definition beyond its traditional #oorin s a. ,his is the le islatures job not the judiciary b. ,he purpose of substanti!e due process is to protect e;istin ri hts$ not to create new ri hts 2. :or purposes of due process analysis$ only ri hts that are Gobjecti!elyH Gdeeply rootedH in history and tradition are reco niFed as funda#ental a. ,here is no historical tradition of sa#e se; #arria e b. Cannot co#pare it to ie interracial #arria e (which also doesn/t ha!e tradition) bc race has lon been reco niFed as a suspect class iii. !he Marriage "aws #o Not #iscriminate Based $n %ender 1. ,he opposite se; re1uire#ent for ender applies re ardless of the applicant/s ender$ it does not disad!anta e either roup 2. Ahere the law does not differ based upon a suspect classification$ struct scrutiny is not re1uired iv. #is&arate 'm&act on %ays and "esbians #oes Not !rigger Strict Scrutiny 1. ,o be considered GsuspectH for e1ual protection pruposes the

2. ?efinin characteristic #ust a. =e based on an i##utable trait i. ,his is #ost contro!ersial b. =ear no relation to a persons ability to perfor# or contribute to society c. =e associated with a sti #a of inferiority and second class citiFenship 2. Court declines to find se;ual orientation a suspect classification v. !he Marriage "aws #o Not 'n(ringe $ther )sserted *onstitutional Rights 1. 9i ht of Pri!acy/Association a. 9espondents here are clai#in an interference of i. Autono#y pri!acy 3 interests in #a%in inti#ate personal decisions or conductin personal acti!ities without obser!ation$ intrusion$ or interference b. ,he ri ht of pri!acy in ha!in inti#ate relations with a sa#e se; partner does not #ean the ri ht to #arry c. ,here is no intrusion of pri!acy here$ no li#itations placed by the o!ern#ent d. 9i ht to #arry has ne!er been reco niFed as a le ally protected pri!acy interest 2. 9i ht of :ree 0;pression a. 0nterin a #arria e is ob!iously so#ethin #uch #ore than a co##unicati!e act b. :urther$ other e;pressions (of #arria e) re#ain a!ailable 3 cannot rise to constitutional !iolation vi. !he Marriage "aws +ithstand Rational Basis Review 1. 9e1uires #erely that distinctions drawn by a challen ed statute bear so#e rational relationship to a concei!able le iti#ate state purpose. 2. Ae #ust uphold the challen ed law if there is any reasonably concei!able state of facts that could pro!ide a rational basis for the classification. ,. State-s 'nterest in Preserving the !raditional #e(inition o( Marriage is "egitimate .. State-s 'nterest 'n *arrying $ut the +ill o( 'ts citi ens is "egitimate a. "t is not the judiciary/s function to reorder co#petin societal interests which ha!e already been ordered by the le islature d. Putati!e &arria es i. "n CA$ a !alid #arria e or re istered do#estic partnership is prere1uisite to the e;istence of a #arital co##unity ii. 'ence$ there can be no co##unity property without a le ally bindin #arria e or do#estic partnership iii. CA :a# Code 4255. Consent; "ssuance of license and sole#niFation

i!. CA :a# Code 4251 Adults; Capability to consent to and consu##ate #arria e !. CA :a# Code 4 257. Proof of Consent and sole#niFation !i. CA :a# Code 42255 "ncestuous &arria e !ii. CA :a# Code 42251 =i a#ous and poly a#ous #arria es; e;ceptions; absentees !iii. CA :a# Code 42215 Annul#ent$ causes for i;. CA :a# Code 42271 .tatus of putati!e spouse; di!ision of co##unity or 1uasi-co##unity property ;. CA :a# Code 42272 Eiability of 1uasi-#arital property for debts of parties ;i. CA :a# Code 42276 +rder for support; putati!e spouse ;ii. CA :a# Code 42277 Attorney/s :ees and Costs e. Coats ! Coats ('usband annuls #arria e for physical incapacity; clai#s all assets as they were #ainly produced by hi#$ with wife/s ser!ices of a non #onetary !alue) 3 ,he 01uitable co##unity doctrine i. Ahere there has not been a !alid #arria e (ie annul#ent) ,he rules which apply to co##. Prop #ay be applied where a !alid #arria e is ter#inated by death of the husband or by di!orce. ii. ,he court will not in1uire as to whether the ac1uisition was by the joint efforts of the husband and wife or atte#pt to adjust their respecti!e ri hts in proportion to the a#ount contributed thereto. f. *otes@ i. .hould not be applied where an injustice would result$ esp in depri!in third persons of !ested property ri hts ii. ,his so called Gco##. PropH within annul#ents is G1uasi #aritalH prop iii. A ood faith belief in the !alidity of the #arria e relationship is a re1uisite to the operatinon of the 1uasi-#arital property syste# . 0state of Eeslie i. "s a sur!i!in putati!e spouse entitled to succeed to a share of his or her decedent/s separate property (per intestate succession) 1. Des$ ii. &any cases support conclusion that a putati!e spouse is entitled to succeed to a share of the decedent/s separate property iii. :urther$ #any conte;ts ha!e accorded putati!e spouses the sa#e ri hts as sur!i!in le al spouses. 1. 3sa#e def/ter# i!. +ne departin case@ 'n /state o( "evie h. 0state of 'afner i. "n cases where two or #ore sur!i!in spouses (one actual$ other putati!e) each clai# an intestate share of the decedent/s separate property i. IeleF ! .#ith i. *o ri ht to do#estic partners to proceed under putati!e do#estic partner theory. *on+marital Co'a,itation j. Iallera ! Iallera

i. A wo#an with no enuine belief that she is le ally #arried to a #an but is li!in with hi# does not ac1uire ri ht to earnin s and accu#ulations durin period of cohabitation 1. ,here is no ood faith belief of a !alid #arria e ii. "f a #an and wo#an li!e to ether as husband and wife under an agreement to pool their earnin s and share e1ually in their joint accu#ulations$ e1uity will protect their interests of each in such property. 1. 0!en in t'e a,sence of an e.press agreement the wo#an would be entitled to share in the eproperty jointly accu#ulated$ in proportion of contributions. 2. =ut here$ there is no e!idence of any such a ree#ent. %. &ar!in ! &ar!in i. Principles which o!ern distribution of property ac1uired in a non#arital relationship 1. ,he pro!isions of the fa#ily law act do not o!ern the distribution of property ac1uired durin a non#arital relationship and re#ains solely subject to judicial decision 2. ,he courts should enforce e;press contracts between non#arital partners e;cept to the e;tent that the contract is e;plicitly founded on the consideration of #eretricious se;ual ser!ices 2. "n the absence of an e;press contrac$ the courts should in1uire into the conduct of the parties to deter#ine whether that conduct de#onstrates an implied contract$ a ree#ent of partnership or joint !enture$ or so#e other tacit contract$ a ree#ent of partnership or joint !enture$ or so#e other tacit understandin between the parties. a. ,he courts #ay also e#ploy the doctrine of 1uantu# #eruit$ or e1uitable re#e#dies such as contructi!e or resultin trusts$ when warranted. T'e Domicile /equirement l. ,he syste# was to apply to the property of persons who contracted #arria e in the state and to property ac1uired within the state by persons who were #arried elsewhere but #o!ed to CA. #. 9oFan ! 9oFan 3 (husband and wife #o!e to CA$ buy property in *? with co##. funds ained in CA 3 it is co##. Prop) i. ,he purchase #oney for the *? props was ac1uired a(ter establishment o( domicile in *) and so is co##. prop n. 8rappo ! Co!entry :inancial Corp (Aife buys *I properties with separate funds as the couple has a reed; at dissolution husband tries to assert it as under co##on law syste# and now co##. prop syste# 3 Court finds it is co##. prop) i. As a rule$ #arital interests in #oney and property ac1uired durin a #arria e are o!erned by the law of the do#icile at the ti#e of their ac1uisition$ even when such #oney and property is used to purchase real &ro&erty in another state. Constitutional 0imitations o. ?ue Process and Pri!ile es and "##unities Clauses

p.

1.

r.

s.

t.

i. CA :a# Code 127 Suasi Co##unity Property ii. CA Probate Code JJ Suasi Co## Prop iii. CA Probate Code 151 Suasi Co## Prop Addison ! Addison i. 9eclassification as Suasi Co##unity Property ?octrine held as constitutional only when 1. =oth parties ha!e chan ed their do#icile to CA and 2. .ubse1uent to the chan e of do#icile the spouses sou ht in a CA court le al alteration of their #arital status. &arria e of 9oesch i. 9eclassification here would be inappropriate 1. 'usband only #o!ed to CA$ wife did not 2. .ubstantial PA interests 9etroacti!ity Proble#s &arria e of =ou1uet i. CA :a# Code 771 (which pro!ides that the earnin s and accu#ulations of both spouses while they li!e apart constitute separate property) #ay be constitutionally applied retroacti!ely 1. "t o!erns all property ri hts$ whene!er ac1uired$ that ha!e not been finally adjudicated by a jud #ent fro# which ti#e to appeal has lapsed &arria e of 'ei%es i. .ection 6855.2 which pro!ides that either spouse shall be rei#bursed for his or her contributions of separate property to the ac1uisition of any property bein di!ided as co##. Prop$ unless they ha!e wai!ed such ri ht in writin #ay *+, be applied retroacti!ely. ii. "n deter#inin whether a retroacti!e law contra!enes the due process clause$ we consider such factors as 1. the si nificance of the state interest ser!ed by the law 2. the i#portance of the retroacti!e application of the law to the effectuation of that interest 2. the e;tent of reliance upon the for#er law 6. the le iti#acy of that reliance 7. the e;tent of actions ta%en on the basis of that reliance and J. the e;tent to which the retroacti!e application of the new law would disrupt those actions ,he .upre#acy Clause i. ,he supre#acy clause of the >. Constitution and the doctrine of federal pree#ption 1. .tate laws #ust yield to any conflictin fed law when Con ress has e;pressly or i#pliedly sou ht federal supre#acy. ii. Aisner ! Aisner 1. ,he fed statute is e;plicit in announcin that the insured shall ha!e the ri ht to desi nate the recipient of the insureance and that Gno person shall ha!e a !ested ri ht to those proceedsH a. .o co##. Prop will not apply here iii. =o s ! =o s

1. :ederal penion plan pree#pts sons fro# ta%in as intestate bc it desi nates sur!i!in spouse.

Ch 4 Selected Problems in Classification

Commingled %unds 1. Co##in lin 3 refers to the co#binin or inter#i;in of co##unity and separate funds into a co##on #ass or pool a. &ost co##only 3 the deposit of both co##unity and separate funds in a sin le ban% account durin #arria e b. Procedure i. 8eneral presu#ption of co##. prop ii. Possible to rebut the presu#ption by directly tracin the asset to a separate property source 1. Also possible is indirect tracin a. Ludicial presu#ption that fa#ily e;penses are paid fro# co##. funds 2. .ee ! .ee a. A husband who co##in les the property of the co##unity with his separate property$ but fails to %eep ade1uate records$ cannot in!o%e the burden of record %eepin as a justification for a recapitulation of inco#e and e;penses at the ter#ination of the #arria e that disre ards any ac1uisitions that #ay ha!e been #ade durin the #arria e with co##. funs. b. "f funds used for ac1uisitions durin #arria e cannot otherwise be traced to their source and the husband who has co##in led property is unable to establish that there was a deficit in the co##unity accounts when the assets were purchased$ the presu#ption controls that property ac1uired by purchase durin #arria e is co##. prop c. ,he husband #ay protect his separate prop by not co##in lin and assu#es the burden of %eepin records ade1uate to establish 2. &arria e of &i; a. >sed tracin throu h schedules and state#ents to deter#ine nature 6. &arria e of :ric% a. Could not pro!e that it was separate funds b. *o e!idence of what other e;penditures were #ade c. *o e!idence as to status and a#ount of separate property in the account at ti#e of pay#ents d. *o e!idence to de#onstrate that it was his intent to use only separate property funds 1usiness Profits 7. Ahen a #arried person uses both separate property and his or her ti#e$ ener y and s%ill in operatin a business J. Apportion#ent rule a. ,he new production of the business should be apportioned accordin to the relati!e separate and co##unity contributions b. Also used with

i. >se of a spouse/s ti#e$ ener y and s%ill with a separate property or when a spouse continutes to #ana e a co##. prop while theyre separated c. Procedure i. "f nor#al rate of return on the separate property capital and the !alue of the co##unity ser!ices 1. ,he portions #ay si#ply be apportioned ratably accordin to the relati!e established contributions ii. "f inco#plete e!idence of a nor#al rate of return 1. Pereira approach 3 allocation of a fair return on the spouses separate property in!est#ents as separate inco#e$ and then the allocation of any e;cess of the co##unity a. Award the !alue of the separate property at the ti#e of #arria e plus a rawsonable return to represent the appreciation of separate capital$ with the rest to co##.) b. "n cases the presu#ption that the profits are co##unity property is partially rebutted 2. Ian Ca#p approach 3 deter#ine the reasonable !alue of the spouses ser!ices$ allocate that a#ount to co##. prop$ and treat the balance as separate prop a. "n cases where the record contains e!idence of the reasonable !alue of ti#e$ ener y$ s%ill and that the separate prop capital is hi hly producti!e 3 that it produced the entire e;cess o!er the reasonable !alue of the ser!ices 7. Pereira ! Pereira a. Des$ without the capital he supplied (separate funds) he could not ha!e carried on the business; but there is nothin to show that all of it was due to his efforts alone. b. ,hus$ separate prop should ain a fair interest 8. &arria e of -oester (husband had co prior to #arria e$ incorporated durin #arria e) a. A co#pany does not beco#e co##unity property when it is incorporated durin #arria e.. it is not Gac1uired.H b. Application of Pereira approach c. .ection 2J65 rei#burse#ent of initial funds is not appropriate bc it doesn/t apply to businesses K. ,assi ! ,assi a. Ian Ca#p approach b. ?eter#ine the reasonable !ale of the husband/s ser!ices in the business$ allocate that a#ount as co##. prop$ and treat the rest as separate prop attributable to the nor#al earnin s of the business i. ,his is at the court/s discretion 3 can rely on e;pert testi#ony$ etc ii. Court uses whate!er they feel will achie!e substantial justice 15. &arria e of "#perato a. ,his is a case in which there is co##unity property thru business durin a #arria e$ and then apportion#ent of increases in the co##. prop after separation into separate prop i. Court says can use either Pereira/Ian Ca#p approach Installment and Credit 2cquisitions

11. +ften the case that both separate and co##unity property is used in the ac1uisition of #ajor assets$ esp those ac1uired o!er ti#e or on credit a. CA courts ha!e de!eloped !arious allocation principles b. *o satisfactory for#ula for #odern co#ple; credit transactions$ i. Ahich can in!ol!e a loan$ #ort a e of e;istin or newly ac1uired property and repay#ent of loan o!er ti#e 1!. 2cquisitions in Installment transactions a. .ituations where i. the initial transaction in the ac1uisitions of such an asset #ay ha!e occurred prior to the #arria e$ with the ac1uisition co#pleted durin #arria e ii. +r the entire ac1uisition #ay ha!e occurred durin #arria e$ but ha!e been acco#plished at least partly with separate funds b. 9ecent court reasonin @ that when an asset is ac1uired o!er ti#e by install#ent pay#ents$ the asset should be apportioned on the basis of co##unity and separate contributions to the total purchase price and classified accordin ly. c. Iieu; ! Iieu; (husband pre#arria e buys land with separate funds$ #arries and pays rest with co##. funds) i. court here too% into the consideration the concept of intent between spouses to share prop as co##. ii. 9ule@ it will be co##. prop to the e;tent and in the proportion that the purchase price is contributed by the co##unity (and !ice !ersa with the separate) 13. 1orro&ed %unds and Credit 2cquisitions a. "n this situation i. 8eneral presu#ption as co##. prop ii. >nless tracin shows separate$ +9 iii. >nless there is a showin that a - controls the classification$ +9 i!. ,hat a ift to the spouse was intended$ +9 !. 9aisin a special statutory presu#ption$ +9 !i. +9 show that the ac1uisition was #ade while the spouses were separate and apart. b. Proble#s arise with i. ,he fact that such transactions ta%e into account other factors li%e the borrower/s personal inte rity; ti#e$ ener y and s%ill in!ol!ed to procure the loan 1. ,o what e;tent should they be considered as a basis for apportion#ent< c. 8udelj ! 8udelj (husband bou ht interest in business with separate property funds for the principle a#ount of B1$755 and the rest was loan B15%; wife clai#s the interest is co##. prop; court dee#s it co##unity property e;cept for the apportion#ent of 2/22MB1$755 separate property interest) i. 8eneral presu#ption of co##. prop will rule unless the seller relied on the spouse/s separate property in e;tendin the credit

ii. the character of the property ac1uired by a sale upon credit is deter#ined accordin to the intent of the seller to rely upon the separate property of the purchaser or upon a co##unity asset. 1. *eed so#e e!idence of it$ cant just assu#e d. =an% of CA ! Connolly i. the proceeds of a loan so #ade on the personal credit of either spouse are re arded as co##unity property$ esp when husband is the borrower ii. ordinarily funds borrowed by the hypothecation of a spouse/s separate property are also separate property e. &arria e of 8rinius i. loan proceeds are only characteriFed as a spouse/s seprate property only when direct or circu#stancial e!idence indicated the lender relied solely on separate property in offerin the loan ii. Eoan proceeds ac1uired durin #arria e are presu#pti!ely co##unity property 1. 'owe!er this presu#ption #ay be o!erco#e by showin the lender intended to rely solely upon a spouse/s separate property and did in fact do so. Aithout satisfactory e!idence of the lender/s intent$ the eneral presu#ption pre!ails f. &arria e of &oore (wife when sin le buys ho#e and #a%es separate prop pay#ents; #arria e they pay fro# co##. funds; husband clai#s to include ta;es$ etc in calculation) i. "ssue@ the proper #ethod of calculatin the interest obtained by the co##unity as a result of pay#ents #ade durin #arria e on the indebtedness secured by a deed of trust on a residence which had been purchased by one of the parties before #arria e ii. ,he calculation of separate and co##. interests does *+, include a#ounts paid for interest$ ta;es$ and insurance 1. =c it doesn/t increase the e1uity !alue of the property; it doesn/t contribute to the capital in!est#ent and not considered part of it iii. Calculation@ (cate oriFed as separate property) 1. .eparate prop interest a. Credit the separate property with the down pay#ent and the full a#ount of the loan less the a#ount by which the co##. prop pay#ents reduced the principal balance of the loan (B1J$J65.77 T (B65$555 - B7$K8J.25) M B75$J76.27). i. ,hen that su# di!ided by the purchase price for the separate property percenta e share (B75$J76.27 / B7J$J65.77 M 8K.62U) ii. ,he separate property interest would be B15K$K51.1J$ which represents the a#ount of capital appreciation attributable to the separate funds (8K.62U of 152$27K.82) 2. Co## Prop interest

a. =y di!idin the a#ount by which co##. prop pay#ents reduced the principal by the purchase price (B7$K8J.25 / 7J$J65.77 M 15.77U). i. ,he co##. prop share would be B1J$K11.2K which represents the a#ount of capital appreciation attributable to co##. funds (15.77U of B152$27K.62) added to the a#ount of e1uity paid by co##. funds (B7$K8J.25) . &arria e of :ric% (husband owns separate prop and #arries and uses co##. prop to #a%e pay#ents) i. 'usband contends that he should be awarded all pre#arria e appreciation and that that appreciation should be factored in AE.+ when deter#inin the respecti!e percenta e interest in the property. 1. Court disa rees with second part$ bc it would i!e hi# double credit for pre#arital appreciation in the !alue of the prop ii. Procedure 1. ,hat separate and co##. prop/s respecti!e interest should be based on the ratio of capital contribution to the purchase price. ,he co##unity should share in the appreciation that accrues durin #arria e in the sa#e proportion that its capital contribution brears to the total capital contribution re1uired to own the property outri ht h. &arria e of Aalrath i. "ssue@ whether a party/s entitle#ent to a separate property contribution rei#burse#ent is li#ited to the ori inal co##unity property to which the contribution was #ade$ or whether$ when that ori inal property is refinanced$ and the proceeds use in part to purchase or pay down indebtedness on the ori inal and other assets$ the contributin spouse can trace the contribution to$ and be rei#bursed fro#$ those assets other than the ori inal asset. ii. .ection 2J65 (b) allows rei#burse#ent for contributions to property 1. Court says GpropertyH is a#bi uous enou h to not preclude property as other property besides ori inal ie. any other co##. prp that is subse1uently ac1uired fro# the proceeds of the initial property and to which the separate property can be traced. iii. Also$ public policy support for it 1. 8eneral e;pectation of rei#burse#ent i!. &ethod 1. Ascertain what percenta e of the loan proceeds traceable to each asset are based on each party/s separate property contributions. a. 'ere$ calculate the ratio of 8ilbert/s separate property contribution to the Eucerne property/s total e1uity at the ti#e of refinancin to ascertain what portion of the lan proceeds represented 8ilber/s separate property contribution traceable to the Eucerne$ >tah$ and *I properties and the joint ban% account

1$. T'e Classification of Impro4ements a. ?eals with the classification of the increased !alue of an ite# of property due to i#pro!e#ent of the subject #atter. i. ,racin principle can be used to show that either co##unity or separate property produced the increased !alues. 1. At best i!es rei#burse#ent not ownership 2. And e!en #ay deny rei#burse#ent absent a - of such b. ,wo types i. =ased upon the nature of the estate used in #a%in the i#pro!e#ents and ii. ,he nature of the estate i#pro!ed c. "#pro!e#ents to .eparate Property i. &arria e of Aolfe (wife used co## funds to pay ta;es and irri ate separate property of husband; wants rei#burse#ent of V funds) 1. Court a rees that rei#burse#ent is warranted and CA courts should not presu#e an unconditional ift when one spouse uses co##. funds to i#pro!e the other spouse/s property. a. Ali ns with public policy$ ppl don/t e;pect to di!orce 2. ?istinction b/w i#pro!e#ents and purchases a. 9educin an encu#brance or helpin to purchase separate prop always benefits the prop b. "#pro!e#ents do not always enhance the !alue of prop i. Can be ill ad!ised or di#inish !alue e!en c. =ut court doesn/t ha!e to see this issue$ bc wife just wants her half$ not appreciation !alue d. "#pro!e#ents to co##unity property i. &arria e of .#ith (wife used her separate funds for down pay#ent on co##. prop; swi##in pool on co##. prop$ etc) 1. :indin that the wife/s separate funds used with the co##. props was intended to be a ift a. *e!er contended it was separate prop b. *e!er re1uested rei#burse#ent in testi#ony c. *e!er any discussion of the funds retainin their separate character or the co##. prop beco#in wifes separate prop d. CC*o a ree#ent for rei#burse#ent i. 9ule@ that a spouse who uses his or her seprate property for co##. purposes is entitled to rei#burse#ent fro# co##. or seprate property only if there is a ree#ent between the parties to that effect 1 . Personal in5ury Damage 2&ards a. Personal injury da#a es reco!ered by a spouse durin #arria e b. ?epends lar ely on when the underlyin cause of action arose. i. "f arose after dissolution while separated$ then seprate property ii. "f durin #arria e$ co##. prop

c. 'owe!er$ on dissolution$ co##. prop da#a es are not subject to the usual e1ual di!ision re1uire#ent$ but are enerally assi ned to the injured party unless otherwise re1/d by justice d. Codes i. 4785 ii. 4781 iii. 4782 i!. 4782.7 !. 4782 !i. 42J52 1. =otto# line 3 personal injury da#a es will be treated in a special way e. &arria e of ?e!lin (husband recei!ed B177% for accident which lea!es hi# paraple ic; couple buys #obile ho#e to ether. Aife clai#s it is co##. prop after dissolution) i. Personal injury da#a es are co##. prop but upon dissolution are to be assi ned to the injured spouse unless justice otherwise re1uires 1. 0!en if justice otherwise re1uires$ still ha!e award at least V to injured spouse 2. Code 6855c can award to both when in consideration of whether there is econo#ic hardship and the ti#e that has elapsed since the reco!ery of da#a es$ and other facts ii. Aife ar ues that the da#a e #oney was used to buy a ho#e and so retains co##. prop character now 1. Court disa rees$ da#a e #oney is supposed to be used$ cant re1uire for it to sit in the ban% to #aintain its separate character iii. Cannot apply re ular inferences of when separate prop is !oluntarily used to co##. prop 3 this is its own ani#al 1. ,hese are co##. prop and are subject to #ana e#ent and control of both spouses a. ,hus for# of title doesn/t #atter and isn/t deter#inati!e as to how such prop be di!ided i!. ,he only ti#e personal injury proceeds lose their character is 1. Absent e;press a ree#ent 2. Proceeds ha!e been co##in led with other co##. prop and it is i#possible to trace the source of the prop or funds a. Co##in lin 3 #i;ture of co##. prop personal injury da#a es with other co##. prop into one undistin uishable$ a#orphous #ass !. Also$ another consideration is that the #obile ho#e had been specially adapted for husbands benefit and that husband would li!e below po!erty le!el 16. Employment /elated 1enefits a. 0#ploy#ent i!es@ ie retire#ent and pension plans$ disability benefits$ and sur!i!ors death benefits

b. ,hreshold 1uestion@ whether a particular type of benefit is susceptible of classification as co##unity property. i. Eoo% at the underlyin nature of the benefit 1. Co##unity property 3 need to deter#ine apportion#ent a. ?eferred co#pensation for ser!ices rendered durin #arria e by the e#ployee spouse b. Ahere the benefit is desi ned to replace lost wa es that would otherwise ha!e arisen durin #arria e 2. .eparate prop a. =enefit represents co#pensation for post separation or post dissolution ser!ices rendered by the e#ployee c. 9etire#ent benefits i. CA courts ha!e found that these are not ratuities but Gproperly part of the beneficence of the e#ployer.H ii. Co##unity property so lon as the pension benefits represent deferred co#pensation for ser!ices rendered by the e#ployee spouse durin #arria e. 1. 0!en Gnon !estedH pension ri hts iii. Co##unity prop bc they are deferred co#pensation i!. ?istinctions of retire#ent plans and pension ri hts 1. ?efined contribution 3 the e#ployer and e#ployee contributions are allocated to an account on behalf of each ind! participatin e#ployee. Account increased each year with his or her allocable share contributions and earnin s 2. ?efined benefit plan 3 pro#ises the e#ployee that upon a stated retire#ent a e$ the plan will ha!e sufficient funds to pay the e#ployee a specified #onthly pension for life a. "e upon co#pletion of a specificter# of e#ploy#ent$ the e#ployee #ay be entitled to a certain percenta e of his a!era e annual inco#e for a specific period precedin retire#ent. i. Ialuation can be speculati!e bc the !alue is dependent on a wide ran e of un%nown !ariable pendin attain#ent of retire#ent a e !. Iested ! #atured pension ri hts 1. Iested 3 the pension ri ht will sur!i!e the dischar e or !oluntary ter#ination of the e#ployee 2. (Brown) pension ri ht which is not subject to a condition of forfeiture if the e#ploy#ent relationship ter#inates before retire#ent a. &ay !est after a prescribed ter# of e#ploy#ent 2. &atured 3 one in which all conditions precedent ha!e ta%en place or are within the control of the e#ployee. a. (Brown) an e#ployees ri ht #ay !est after a ter# of ser!ice e!en thou h it does not #ature until he reaches retire#ent a e and elects to retire

!i.

!ii. !iii. i;.

b. &ay not #ature until the e#ployee reaches the specified retire#ent a e and elects to retire Apportion#ent 1. Apportion#ent doctrines we/!e learned (ie business profits) still applicable when the e#ployee spouse wor%ed before$ durin $ and after #arria e a. .eparate and co##. prop apportion#ent b. Ahich apportion#ent doctrine depends on nature of the plan i. %ilbert apportion#ent for benefits on basis of relati!e contributions but cant do it for defined benefits plan *e;t$ need to !alue and di!ide the benefits 1. Can be proble#atic to !alue CA :a#ily Codes 1. 42J15. 9etire#ent plans; orders to assure benefits &arria e of =rown (husband has a few #ore #onths to o until his pension plan will !est$ he clai#s its not !ested and thus not a property ri ht per French. Aife clai#s it is property subject to co##unity prop) 1. French v French held that non!ested pension ri hts are not property$ but a #ere e;pectancy and thus not a co##unity asset subject to di!ision upon dissolution of a #arria e. 2. ,his court o!errules French a. bc non!ested pension ri hts are not an e;pectancy but a contin ent interest in property b. #erely foresees that he #i ht recei!e a future beneficence$ such as the interest of an heir apparent; howe!er an e;pectancy is that its holder has no enforeceable ri ht to the beneficence i. CA courts say not beneficence but consideration earned by e#ployee ii. ,his ri ht is a contractual rig't$ deri!ed fro# ter#s of e#ploy#ent - 3 a chose in action$ a for# of property iii. 0#ployee ac1uires a property ri ht to pension benefits when he enters upon the perfor#ance of his e#ploy#ent i!. ,he #ere fact that perfor#ance is in whole or in part dependent upon contin encies doesn/t pre!ent a - fro# arisin 2. ,hey comprise a community asset su,5ect to di4ision in a dissolution proceeding to t'e e.tent t'at suc' rig'ts deri4es from employment during marriage a. +therwise would result in ine1uitable di!ision of co##. assets

6. ,his Gnew lawH will apply prospecti!ely and to any cases that at the ti#e of the rulin ha!e not had final jud #ent yet ;. &arria e of =er #an (husband appeals di!ision of his pension benefits as cash out !alue as opposed to in %ind !alue; and contests the reser!ation of jud #ent on his wifes retire#ent benefits) 1. ?i!ision of benefits a. Cash out 3 deter#ine the present !alue of the co##unity property ri hts and award the# to one spouse with offsettin co##unity or other assets to the other b. "n %ind 3 di!ide the co##unity interest in %ind between the spouses$ reser!in j; to super!ise future pay#ents to each spouse 2. =ecause its not possible to de!elop co#prehensi!e uidelines for trial courts to follow in de!idin whether to cash out or di!ide in %ind and bc this decision is reached pri#arily by the wei hin of e1uitable and factual considerations$ appellate courts should not second uess the e;ercise of the broad discretion of trial courts in the absence of a clear showin of an abuse of discretion. 2. Court found it was o%ay to reser!e jud #ent on wife/s pension so lon as it did di!ide it. "f didn/t di!ide it no within their authority to just reser!e jud #ent. :urther. ,he fact that husbands pension plan was awarded in %ind doesn/t re1uire the sa#e treat#ent for wife. ;i. &arria e of 8il#ore (husband can cash in his retire#ent pension but doesn/t want to retire yet$ wife de#ands i##ediate #onthly pay#ent of her share in it; husband wants to delay until he actually recei!es the benefits) 1. Court holds that wife is entitled to her full share of the benefits@ 2. 'usbands benefits are both !ested and #ature$ the only condition precedent to the pay#ent of the be#efits is his retire#ent 2. A unilateral choice to porstpone retire#ent cannot be #anipulated so as to i#pair a spouse/s interest in those retire#ent benefits a. (if husband were to die$ it would lea!e !era with nothin $ and this also depri!es her of i##ediate enjoy#ent of the benefits) b. 0arl can decide to postpone retire#ent but he shouldn/t be able to force !era to do so too i. 'e #ust co#pensate her for her full share of the benefits as a result of his decision 6. Co#pensation here is possible bc the interst here is %nown$ the benefits ha!e !ested and #atured 3 no uncertainties a. 0ither husband can Gbuy outH wifes interest$ or b. Pay her #onthly pay#ents ;ii. &arria e of Eeh#an ('usband wor%s for co and has a retire#ent plan$ after di!orce$ he ets Genhanced benefitsH which he clai#s are not part of the co##unity property funds; wife clai#s it is.)

1. Court finds that a none#ployee spouse own a co##. prop interest in an e#ployee spouse/s retire#ent benefits as enhanced. 2. An e#ployee who ains Ge;cess earnsH is not allowed to %eep beyond what would ha!e been accrued nor#ally a. =oth parties ri hts are subject to chan es in the ter#s of a retire#ent plan b. Ahat the none#ployee spouse possesses is the ri ht to share in the pension as it is ultimately determined any enhance#ent is a modification of an asset not t'e creation of a ne& oneH 2. .hould be apportioned in a #anner that is reasonable and fairl representati!e of the relati!e contribution ;iii. &arria e of 'u (husband ets a new job while #arried and later ranted stoc% options) 1. "@ deter#ination of co##unity and separate property interests in e#ployee stoc% options ranted to the e#ployee/s spouse prior to the date of separation but only e;ercisable thereafter 2. Court says first ha!e to loo% at the situation a. Ahy were the stoc% options ranted< i. Co#pensation for future ser!ices$ past$ both< 2. 'ere$ found that the options were earned fro# the co##ence#ent of Paul/s e#ploy#ent (durin #arria e) and ranted in lieu of present co#pensation durin initial period of e#ploy#ent a. .o co##. is entitled to share 3 ti#e rule fi;es the co##. interest in Paul/s options be innin at a point in ti#e before separation; b. "f the options had been ranted after separation would/!e been separate d. ?isability benefits p682 i. &arria e of 0lf#ont (husband too% out co##. funds to et disability insurance$ ot bac% probs$ after separation #aintained the insurance with separate funds; found it was husbands separate prop) 1. "ssue@ >nder what circu#stances sould disability insurance benefits recei!ed by a husband after dissolution of the #arria e be di!ided as co##. prop< a. Co##. prop when 3 the insurance was purchased wholly out of co##. funds and pay#ent of the benefits co##enced durin the #arria e$ insofar as they were intended to pro!ide retire#ent inco#e b. .eparate property 3 insofar as they were intended to replace the disabled spouse/s after separation earnin s 2. Application$ here@ a. Co##unity funds to purchase insurance policies for husbands disabilities benefits durin #arria e and up to sepration. After separation$ husband paid further renewal pre#iu#s out of his separate property

b. .o#e e!idence of intent to pro!ide retire#ent inco#e i. :indin s that he %new there was oin to be a proble# so he too% out the insurance c. Aftrer separation pay#ent thru separate funds to #aintain d. *o e!idence at ti#e of #aintenance of intent to contribute to co##. retire#ent inco#eCC 2. +ther rules@ a. 'a!e to loo% at the intent i. At ti#e of insurance purchase ii. At ti#es that decisions were #ade to continue the insurance rather than let it lapse 6. Conclusion@ husbands separate prop a. 'usband beca#e entitled to draw the benefits only after he had renewed all three ter# policies followin separation. e. ,er#ination and +ther 0#ploy#ent-related benefits i. &arria e of 8ra# (husband and wife separated$ after$ husband was then offered early retire#ent with enhanced benefits; wife contests this as co##. prop; court found it was co##. prop) 1. "ssue@ characteriFation of the enhanced early retire#ent benefit accepted by Allen. a. "f the benefit is a for# of deferred co#pensation for ser!ices rendered 3 co##. asset i. 0;a#ples 1. when ter#ination pay entered into - durin #arria e 2. se!erance pay as a - ri ht deter#ined by years of ser!ice b. "f the enhanced benefit is present co#pensation for Allen/s loss of earnin then 3 separate asset i. A !oluntarily ranted noncontractual pay#ent intended as future replace#ent co#pensation for e#ployees pursuin new jobs and to ease transition ii. >su non contract$ no absolute ri ht to pay#ent iii. 0;a#ples 1. Aee%ly layoff benefit for those who lost their jobs 3 desi ned to replace lost inco#e 2. *on contract bsed lu#p su# ter#ination pay#ent 3 in anticipation that itd be hard to find another job c. Conclusion@ co##. prop i. ,here wasn/t a contractual obli atrion but court says this isn/t deter#inati!e ii. ,he plan a!e e#ployee the benefit e;pected had they not #er ed Co/s iii. ,hus$ not a pay#ent for lost earnin s but

i!. ,he realiFation of allen/s retire#ent e;pectation and thus a for# of deferred co#pensation for ser!ices rendered

Ch 5 Spousal Management and Creditor s !ights p5"#

)pousal "anagement 1. 01ual &ana e#ent 3 either spouse has the ri ht to #ana e the co##. prop 2. Considerations a. 9e1uires tht each spouse act as a fiduciary with respect to the other spouse 2. Cal Codes a. 721 b. 1155 c. 1151 d. 1152 e. 1152 6. ,yre ! Aetna Eife "nsurance (husband had life insurance; w/o wife/s %nowled e he chan ed the ter#s to an alternate settle#ent of pay#ent (payable by annuity to her for life rather than as a lu#p su#.); wife contests it) a. Conclusion@ Court finds that she had an election b/w her statutory interest or in accordance to husband/s wishes b. plaintiff had not lost her ri ht to set aside her husbandWs unauthoriFed disposition of her co##unity interest; howe!er she was not entitled to recei!e his share under the ter#s of the policy. 7. &arria e of .titt (Aife indicted for e#beFFle#ent and tried to pay attorneys fees out of co##. funds$ husband protests) a. "1@ Ahether a pre#arital couple #ay #a%e as bindin an oral a ree#ent to own all future ac1uired property e1ually irrespecti!e of record title i. Des ii. :a#ily ho#e as c## prop$ e!en tho prior to separation was deed to wife as separate prop b. "2@ Ahether the co##. should be responsible for unpaid attorney fees incurred by the wife for her defense a ainst e#beFFle#ent char es< i. *o$ separate funds re1/d ii. ,he actor is solely responsible for willful and ne li ent acts unless shared$ #iti ated$ or e;cused because of other principles of law 1. +nly reasonable participants in cri#e or torts bear the loss J. &arria e of ?uffy (husband solely #ana ed the finances of the fa# and lost B - for ') a. "1@ ?id the husband breach his fiduciary duty of full disclosure< *o i. Eoo% to whether an act would ha!e been futile nor#ally 1. A 1uestion of fact 2. &ay be deter#ined as a S of law only if the facts are undisputed 2. Application@ Court found that was not futile for wife to as% 3 the past had occasionally yielded results. .o it was possible for her to obtain infor#ation on in1uiry b. "2@ ?oes a spouse e!er owe a duty of care< *o

i. A spouse is enerally not bound by the prudent in!estor rule and thus does not owe a duty of care. ii. ?oesn/t #atter whether an in!est#ent durin #arria e lost #oney and was one that a prudent fiduciary would not ha!e #ade. c. :a# Code 1155 co#es into play here i. .ection (e) Gin accordance with the eneral rules o!ernin fiduciary relationships PQR includes the obli ation to #a%e full disclosure to the other spouse of all #aterial facts and info re ardin the e;istence$ characteriFation and !aluation of all assets in which the co##. has or #ay ha!e an interest.. and to pro!ide e1ual acess to all info$ records$ and boo%s that pertain to the !alue and character of those assets.H d. :a# code 721 - ?efinin the scope of spousal fiduciary duty i. .ection (b) 1. (1) pro!ides access at all ti#es to boo%s 2. (2) renders u&on re0uest true and full info of all thin s re co##. prop 2. (2) accountin to the spouse any benefit or propertyQ 7. Ailco; ! Ailco; (wife secretly held co##. funds. 'usband wants to sue to etthe B) a. A spouse has the ri ht to reco!er and re1uire the other spouse to account for co##unity funds which were the proceeds of co##. prop /ecapture and /eim,ursement Proceedings 8. :a# Codes 1155 and 1152 a. 8i!es ri ht to #ana e and control i. but prohibits ri ht to #a%e 1. ifts of co##. prop w/o consent of both 2. con!eyance of real prop w/o consent of both b. Ahen there isn/t consent and real prop has been con!eyed i. "f #arried 1. ,ransfer bac% in in total ii. "f dissol!ed #arria e - 9ecapture 1. ,ransferee holds !oidable title a. "njured spouse can recapture their V title b. Aron ful spouse is bound by transaction and i!es up their share 2. =ut injured spouse is li#ited to 1 yr .oE and #ust raise clai# a. =e ins to run when transaction is recorder by purchaser 2. 9e#edies for transferee 3 ?enial of 9ecapture a. 'as to be in ood faith b. ,hen can raise estoppels or wai!er c. ,hen they can %eep the prop conditional on rei#burse#ent to third person K. .prec%els ! .prec%els (dead husband ifts co##. prop to so#eone else$ wife dies$ e;ecutor tries to !oid the ift) a. ,he ifts did not beco#e !oid at the death of the husband$ but were only !oidable by the wife at her option and her proof

15. 0state of Ailson (husband dies intestate$ he has 15 trusts set up so#e for %ids and so#e for wife. -ids contest that wife should et share of %ids trusts. :or A$ she ets 155U of undisputed trusts and V of disputed trusts e!en tho she ets #ore than V of co##. prop) a. 9ule@ ,hat when a spouse deposits co##unity property funds in a ban% account in his na#e as trustee for a third person$ upon that spouse/s death only one haldf of the co##unity property in the account is trans#itted to the third person. i. ,he other half oes to the sur!i!or e!en thou h he or she is already recei!in #ore than one half of the total co##unity property of the parties b. "f a spouse$ after the death of the decedent$ pro!es a lac% of consent to a ift$ it will be a!oided to the e;tent of the nonconsentin spouses one half interest in co##unity property transferred i. Cant just force the nonconsentin spouse to an election re1uirin the# to either underta%e the intestate sche#e or ta%e their co##. share. 1. "e. cant just ha!e spouse de!ise prop to 2rd party e!en if there are sufficient other co##. assets to counter balance the ifts !alue$ because each pouse only owns an undi!ided V interest 11. ?roe er ! :ried#an$ .loan O 9oss (wife initiated proceedin s to di!orce$ and a!e counsel pro#issory note for interest on co##. real prop for her attorneys fees. 'usband sues to 1uiet title fro# encu#brance) a. Ahether a security interest in co##. real prop i!en by one spouse to secure attorney fees durin a pendin #arital dissolution proceedin is !alid under :a# Code 1152. i. Concludin that :a# Code 1152 intended to pre!ent di!ison of co##. prop unless by a ree#ent$ death or dissolution ii. '@ 'usband was entitled to !oid the encu#brance in its entirety. b. ?roe er says that the unilateral action per the lien is in!alid$ but EeFine hold that the co##unity will still be liable for that debt anyway 12. EeFine ! .ecurity Pacific :inancial .er!ices$ "nc (husband unilaterally transferred a security interest in co##. real prop to ? .P :inancial .er!ices. 'e for ed his wife si nature di!estin her of interest and then secured a loan on the basis of the prop. Court found in!alid the lien and then awarded that prop to wife as separate prop) a. "@ Ahether the fa# code 7127 will cancel the debt attached to the co##unity i. *o$ the loss of the security does not e;tin uish the underlyin debt Creditors /ig'ts 12. 8enerally$ all co##. prop is liable for debts incurred by either spouse durin #arria e. a. 0;ceptions i. Ahen spouse has e;clusi!e #ana e#ent and control ri hts o!er certain co##. assets 1. .pouse has Gpri#ary #ana e#entH of business 2. Co## prop ban% account in na#e of only one spouse 2. .pouse is placed under conser!atorship 16. CA :a# Codes 17. 8role#und ! Cafferata ( a. Ahether co##. prop #ay be subjected to the satisfaction of a jud #ent a ainst the husband for his tort. i. Des

b. Conduct for benefit of co##. prop ets hit first 3 .ection K15 #odel 1J. &arria e of :eldner (husband #ade - to build house$ separated fro# wife then breached - and is now liable for -) a. Ahether the co##unity is liable for his breach of - - Des i. Cal :a# Code K52 1. A debt is incurred at the ti#e the - is #ade 2. Co##unity is liable for deb incurred by either spouse before or durin #arria e b. App@ ,he - was #ade durin the #arria e i. "t was then that the co##. had the ri ht to recei!e pay#ent fro# the Allens and bca#e obli ated to perfor# the -. 17. A#erican +lean ,ile Co "nc ! .chultFe (couple e;ecuted &.A desi natin the business to be separate prop of husband$ after dissolution he incurs debt and tries to clai# co##. funds are indebted) Court says *o 3 only separate fund indebted a. After the e;ecution of a !alid #arital settle#ent a ree#ent$ ne otiated at ar#s len th and pro!idin a co##unity business is transferred to the spouse who had been e;clusi!ely operatin it as his separate property$ all o,ligations of t'e ,usiness incurred t'ereafter are t'e sole o,ligation of t'e recipient spouse b. "nco#e earned and obli ations incurred after separation in the operation of a separate property business are not co##. in nature 18. &arria e of =raendle a. ,he court found that respondent was not personally liable for the debt owed by her husband to appellant$ and that$ under Cal. :a#. Code K1J$ the co##unity property assi ned to her could not be reached to satisfy the debt. ,he court concluded that respondent held a prior security interest$ which was perfected when her husband transferred possession of the stoc% to the court cler% to secure his debt to respondent under the dissolution jud #ent. b. 'usband owes an e1ualiFer pay#ent to his wife i. Lud e #a%es husband i!es stoc%s to law fir# as security for the e1ualiFer pay#ent so that he cant sell/encu#ber the stoc% ii. ,he co#pany of the stoc% files a clai# to et the stoc% bac% 1. .ection K1J 3 wife/s interest has priority o!er the husbands creditor bc that debt wasn/t assi ned to her 1K. &ejia ! 9eed (&an cheats on wife with P$ dissol!es #arria e with wife and i!es her all real prop. P says its bc he doesn/t wanna pay child support and re1uests lien on prop) a. P/s clai# is that this was a fraudulent transfer to pre!ent collection of child support b. "@ ?oes >nifor# :raudulent ,ransfer Act (>:,A) apply to property transfers under &arria e .ettle#ent A ree#ents< Des.

Ch $ Division of Community Property at Dissolution p$%5

6enerally 1. &ethods a. Property settle#ent a ree#ent ne otiated by the parties b. Eiti ation in the conte;t of the dissolution proceedin .

2. +nly two rounds for dissolution a. "rreconciliable ?ifferences b. "ncurable "nsanity )ection 1. Di4ision ,y Property )ettlement 2greement 2. )cope and 7alidity 2. &arria e of 'ufford a. Per#anent spusal support will always be #odificable or e;tendable unless a !ery ti ht &.A that lea!es no doubt as to when the spousal support will end. +r else can be #odified up or down. Ahy is co##. prop di!ision i#portant to spousal support< b. Cant #a%e spousal support orders until you/!e di!ided up the co##. prop. 'a!e to %now wat the assets and liabilities are in addition to their inco#e and none1uitable factors. )ection !. Di4ision ,y Court 8rder 6. Cal :a# Codes pJ67 1. 9. to Di4ide Property a. Power fro# .ection 2515 b. Personal j; re1uired 7. 8ionis ! .uperior Court a. Court #ay bifurcate the issue of #arital status (dissolution of) fro# issues of custody$ support$ property di!ision$ etc. b. Concept of Gdi!isible di!orceH 3 .e!erance of a personal relationship is not dependent upon final settle#ent of property disputes. c. Can file #otion to bifurcate and et you #arria e dissol!ed separately J. 9obinson ! 9obinson a. Court does not ha!e power (j;) to #eddle with separate property i. Ei#ited to co##. prop b. Court cannot car!e out a life estate for wife in husbands separate property c. Consistent with .ection 2J75 3 that the only ti#e the court can et into di!idin separate prop is when it/s a joint tenancy/tenancy in co##on and one party re1uests it 7. &uc%le ! .uperior Court a. "@ whether CA can e;ercise personal j; o!er Andrew$ who is do#iciled in 8A< *+ b. 8eneral L; 9e1uire#ents i. ,hat the court ha!e authority to adjudicate the specific #atter raised by the pleadin s (subject #atter j;) 1. App@ Des here ii. ,hat the court ha!e in re# j; o!er the #arital res to ter#inate #arital status 1. Eoo% to do#icile of parties at ti#e prop was ac1uired to characteriFe it as seprate or co##. for di!ision 2. App@ Des here iii. ,hat the court ha!e j; o!er the parties to adjudicate personal ri hts and obli ations (personal j;)

1. Ahere the ? is do#iciled in the foru# state when the lawsuit is co##enced 2. Ahere the ? is personally ser!ed with process while he or she is physically present in the foru# state 2. Ahere the ? consents to the j;$ and 6. Ahere the ? has sufficient #ini#u# contacts (at ti#e of proceedin s) with the foru# state$ such that the e;ercise of j; would not offend Xtraditional notions of fair play and substantial justice./ a. =alancin the burden or incon!enience to the nonresident a ainst the resident interest in obtainin effecti!e relief and the states interest in adjudicatin the dispute b. +9 .pecific personal j; i. 9e1uires that the nonresident purposefully directed his acts to the foru# state or otherwise purposefully established contacts with the foru# state$ that the cause of action be related to or arise or result fro# the acts or contacts in the ofru#. c. P has initial burden of de#onstratin personal j;$ when they de#onstrate so#e e!idence$ burden shifts to ? to show it would be unreasonable 8. &arria e of Andresen (husband contests default jud #ent as a result of his failure to ti#ely respond to petition of di!orce; alle es she should ha!e been #ore particular) a. ,he wife properly and fully co#pleted the petition and its necessary attach#ents to the e;tent of the relief re1uested on the face of the docs 3 the husband was i!en ade1uate notice. ?efault is appropriate. )ection 1. T'e Equal Di4ision /equirement K. 8enerally 3 di!ide e1ually 15. 0;ceptions a. .ection 2J52 3 #ay award any su#s deliberately #isappropriated by that spouse to the e;clusion of the co##. prop interest of other spouse. b. .#all co##. prop estate 3 when less than B7$555 and one party cannot be located with due dili ence 3 award all to one spouse c. ,reat#ent of personal injury da#a e awards i. Assi ned upon dissolution to injured spouse$ ii. unless other interests of justice 1. factors@ econo#ic needs of each party$ ti#e elapsed since reco!ery$ accrual of the cause of the action 11. &arria e of .tallworth a. .ection 2851 O 2 b. ,rial jud e has broad discretion to defer sale of house based on !ariety of factors c. ?u%e +rder 3 deference re1uires econo#ic feasibility to do so i. &eanin that person in the ho#e will be able to pay the #ort a e and #aintain the ta;es$ etc of the prop ii. +ther consideration is whether its econo#ically feasible for the party not li!in there 3 can they afford another ho#e<

iii. 01uity discretion - Child dri!en as a factor 12. &arria e of ,a##en (wife awarded 7KU of co##. prop while husband ets payable pro#issory note and he contests this) a. Court finds this an ine1uitable di!ision i. .ection 2J51 3 where a #ajor ite# of co##. prop is awarded one party$ the other shall be co#pensated to #aintain the re1uired e1ual di!ision b. A note is inferior in its security and has deferred enjoy#ent 12. &arria e of 0astis a. "f #ore obli ations then assets 3 court has discretion to order the pay#ent of such obli ations in a #anner that is just and re1uitable$ dependin upon the respecti!e earnin capactieis of the spouses and other rele!eant factors )ection C. 7aluation 16. &arria e of &icaliFio a. ,rial court findin s on !aluation of stoc% is dee#ed incorrect and re#anded in consideration of di!ision in %ind )ection D. 2ssignment of 0ia,ilities 17. .ections 2J25 su##ary p J82 3 see )ection E. Ta. Consequences of Di4ision 1J. Proble# that so#e props are Ghi h basisH !s Glow basisH (which will incur substantial capital ains ta; liability) 17. 'owe!er$ property di!ision at dissolution is not a ta;able e!ent. 18. &arria e of 'arrin ton a. - Ct. doesnWt care about ta; conse1uences of di!idin CP unless ta; conse1uences are i##ediate - Ct will ta%e into consideration if ta; conse1uences are i##ediate )ection 3. Post Dissolution /emedies 6:6+773 1K. 9e#edies for situations a. "e. after jud #ent of dissolution$ one of the parties finds a si nificant co##. asset was concealed (or thru ne li ence) )ection 2. /elief %rom %raud of "ista;e 25. Aest Cal :a# codes a. 2125 b. 2122 c. 2122 21. &arria e of Iarner (Aife contends post-jud #ent with supportin e!idence that husband o#itted full e;tent or !alue of co##. prop at ti#e she si ned the stipulation.) a. Court sets aside jud #ent di!idin up the co##. prop i. .ection 2152 re1s full disclosure in ood faith 3 husband !iolated this ii. ,hus$ there are rounds to set aside a jud #ent on rounds of #ista%e under .ection 2122 22. &arria e of -ietura%is 3 ,he &ediation Pri!ile e (Aife clai#s undue influence in #ediation and contests disclosure of #ediation info) a. ,here are no e;ceptions to the confidentiality of #ediation co##unications b. 9@ ,he presu#ption of undue influence cannot be applied to &arital .ettle#ent A ree#ents reached thru #ediation

i. Assu#ption that #ost #ediators would deter#ine that parties are actin under their own free will ii. Also$ it would otherwise under#ine the practice of #ediatin such a ree#ents )ection 1. Concealment of Community Property 2ssets 22. &arria e of 9ossi (Aife wins lottery$ files for di!orce$ and purposely hides the co##. asset in di!ision of prop) a. Per section 1151 3 an award of 155U of the o#itted property will be awarded to the P when to penaliFe a bread of fiduciary duty by spouse in dissolution proceedin s i. ,he court found this applicable here as there was fraud 1. :raud (per section 22K6) #eans an intentional #isrepresentation$ deceit$ or conceal#ent of a #aterial fact %nown to the ? with the intention on the part of the ? of thereby depri!in a person of property of ri hts ii. .ection 1151( ) (which would award 75U to co#plainin party) does not apply bc it applied when breach of duty does *+, constitute fraud$ oppression or #alice under 22K6 )ection C. 8mission of 2ssets 26. 'enn ! 'enn (Aife see%s to reopen jud #ent to adjudicate whether husbands pension plan is co##. prop. 'usband says case closed 3 res judicata/collateral estoppels stop its) a. "@ Ahether a for#er spouse #ay brin an action establish her co##. prop interest in husband/s federal #ilitary pension which was no adjudicated or distributed in the final decree of the dissolution b. D$ #ay reopen to adjudicate such property i. .ection 277J 1. Court has continuin j; o!er assets which ha!e no been preciously adjudicated 27. Alloy ! &ash (wife sues her attorney for failin to assert a co##. prop interest in e; husbands !ested #ilitary retire#ent pension (at the ti#e #atured pensions had not been adjudicated upon until just after this case was tried)) a. Court finds that there is a triable issue of ne li ence by the attorney for actin on an inco#plete readin of a sin le case 3 re#ands to try

Ch & ' Distribution of Comm Prop at Death p&3&(&&3

1. Ahen a #arried person dies w/o a will 3 intestate succession a. Co## Prop/Suasi co##. prop di!ision i. +ne-half oes of co##. prop oes to sur!i!in spouse ii. ?ecedent/s other half oes to sur!i!in spouse by intestate succession b. .eparate Prop (depends on a#t of %ids) i. .pouse and 1 %id (di!!y up per hal!es) ii. .pouse and 2T %ids (1/2 to spouse; 2/2 to di!ide up a#on all %ids) iii. .pouse no %ids (1/2 to spouse; V to parents$ bros$ sis i!. .pouse$ no i##ediate fa#ily$ no %ids (spouse 155U)

2. Probate Ad#in a. Collection and in !entory of assets b. Pay#ent of debts and taces c. ?istribution of prop to beneficiaries under will or intestate succession 2. Aest Probate codes of CA 6. ?awes ! 9ich a. "1@ Ahether upon the death of one spouse liability for their debts incurred durin #arria e continues upon the sur!i!in < i. Des ii. >nder Probate code 12775 3 sur!i!or is liable for debts of deceased spouse b. "2@ "f yes$ does the le islature li#it the ti#e in which such liability #ay be asserted i. Des$ 1 yr .+E after the date of the death 1. Code of ci!il Procedure section 272(d)/2JJ.2 7. Collection =ureau of .an Lose ! 9u#sey J. 0state of Pra er (husband thru probate auto#atically a!e his widow V of the co##. prop then de!ised thru will to share with his fa#ily his share of the half; niece protests) a. Court rules that there is nothin to force widow thru election of either her probate share or the de!ised share$ she can ha!e both.