Commingling Community Property & Separate Property

Question 1

Commingled Accounts – general principles for tracing expenditures.

Answer 1

The fact that SP funds are commingled with CP funds does not transform or transmute the SP into CP.

Question 2

Burden of proof in commingled accounts

Answer 2

However, the burden of proof is on SP owner to show that an asset was acquired w/ separate funds (through direct tracing, or exhaustion and drawer’s intent). Of course this is easiest when no withdrawals have been made.

Question 3

Commingled accounts presumption

Answer 3

It is presumed that expenditures for family expenses were made w/ CP funds (to the extent available), even if it was known that SP funds was also available. However, b/c of commingling and inadequate records, some family expenses paid by SP are presumed a gift to the community (absent contrary agreement).

Day-by-day accounting rule (rather than cumulative assets at time of divorce) is applied in See, Mix, and Frick.