Community Property Flashcards
Topics? (4)
(Community Property?)
- Framework for Determining Characterization of Asset
- Definitions
- Marital Status
- When Does the Economic Community End?
Four questions?
(Community Property?: Framework for Determining Characterization of Asset)
- When Was the Asset Acquired?
- How Was the Asset Acquired?
- Are There Any Legal Presumptions That Affect the Asset’s Character?
- Did Subsequent Actions by Either Spouses Change the Asset’s Character?
Three terms?
(Community Property?: Definitions)
- Community Property (CP)
- Separate Property (SP)
- Quasi-Community Property (QCP)
Structure?
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(Community Property?: Marital Status)
- Legal Marriage
- Legal Capacity of Both Parties
- Witnessed Ceremony of Marriage
- Issuance of Marriage License
- Invalid Marriage
- Due to Bigamy
- Incest
- Noncompliance with Law, OR
- Prior Invalid Divorce
- Registered Domestic Partners
- Eligible Parties?
- Same-Sex Couples, OR
- Elderly Opposite-Sex Couples Receiving Social Security Benefits
- Applies Retroactively
- 1/1/2000
- Eligible Parties?
- Putative Spouse
- Effect of Putative Spouse = Quasi-Marital Property
- Revocation of Putative Spouse Status
- Meretricious Spouse = Unmarried Co-habitants
- Revocation of Putative Spouse Status
- Estoppel
- Decedent Leaves Both Putative Spouse & Legal Spouse = Both Share Equally
- Legal Spouse Deceased = Putative Spouse is Decedent’s Surviving Spouse
- Domestic Partnerships
- Effect of Putative Spouse = Quasi-Marital Property
- Property Relations of Persons Not Legally Married
- Marvin Case
- Property Acquired Outside the Marital Relationship
- Exception: Common Law Marriages of Other States
Structure?
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(Community Property?: When Does the Economic Community End?)
- Permanent Physical Separation
- Intent Not to Resume Marital Relations
- Intent Not to Resume by One Party Sufficient
- Factual Question
- Facade of a Martial Relationship
- Effect of End of the Economic Community
Structure?
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(Presumptions)
- Community Property
- General Presumption
- Rents, Issues and Profits Thereof
- Separate Property
- Property Owned by Either Spouse Before Marriage
- Property Acquired During Marriage By
- Inheritance
- Bequest, OR
- Devise
- The Source Rule
- Rents, Issues and Profits Thereof
- Burden of Proof
- Quasi-Community Property (QCP)
- Commingled Assets
- Jointly Held Bank Accounts
- Earnings While Permanently Living Separate & Apart
- Presumptions Inferred from Title
Topics? (9)
(Difficult to Classify Assets)
- Business Owned Before Marriage Substantially Increases in Value During Marriage
- Pension Benefits
- Disability Retirement Benefits or Workman’s Camp Benefit
- Severance
- Military Retirement
- Stock Options
- Goodwill of a Professional Practice
- Educational Expenses
- Personal Injury Award (Tort Liability)
Structure?
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(Difficult to Classify Assets: Business Owned Before Marriage Substantially Increases in Value During Marriage)
- Van Camp = Valuable Company or Asset
- Substantial Salary & Large Bonuses
- Formula
- Community Component
- Pereira = Personal Skills & Effort
- Formula
Structure?
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(Difficult to Classify Assets: Pension Benefits)
- Proration Rule
- Numerator = # of Years Of Service While Married
- Denominator = # of Years Of Employment Until Retirement
- Form?
- “When & If Received” Decree
- Cash Out
- Note:
- Retain Jurisdiction Until Pension Vests
- Eligible for Retirement at Time of Divorce but Elected Not to Retire
- No Divorce but Death of Nonparticipant Spouse = No Devisable Interest
Structure?
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(Difficult to Classify Assets: Disability Retirement Benefits or Workman’s Camp Benefit)
- Choice of Disability or Retirement Benefit
Structure?
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(Difficult to Classify Assets: Severance)
- SP Authority
- CP Authority
Structure?
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(Difficult to Classify Assets: Military Retirement)
- Uniformed Services Former Spouses Protection Act
- Regular Military Retirement = Yes
- Military Disability Retirement = No
Structure?
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(Difficult to Classify Assets: Stock Options)
- Proration Formula
- Primary Intent of the Employer = Reward Past Services (Marriage of Hug)
- Numerator = # of Years From Date of Employment To End of Economic Community
- Denominator = # of Years From Date of Employment to Date Options Become Exercisable
- Primary Intent of the Employer = Future Retention of Employee (Marriage of
Nelson)- Numerator = # of Years From Date Options Granted to End of Economic Community
- Denominator = # of Years From Date Options Granted to Date Options Become Exercisable
- Primary Intent of the Employer = Reward Past Services (Marriage of Hug)
Structure?
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(Difficult to Classify Assets: Goodwill of a Professional Practice)
- Definition
- Value?
- Expert Witness Testimony, OR
- Capitalize Excess Earnings Attributable to Goodwill
- Buy-Sell Agreement = Not Conclusive
Structure?
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(Difficult to Classify Assets: Educational Expenses)
- Reimbursement
- Defenses to Reimbursement
- Substantial Benefit
- Reciprocal Community Funded Education, OR
- Education Offsets Need for Spousal Support
- Debt Assigned to Spouse Who Incurred Educational Loans
Structure?
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(Difficult to Classify Assets: Personal Injury Award (Tort Liability))
- Other Spouse Tortfeasor
- Policy
- 3rd Party Tortfeasor
- Death
- Divorce or Legal Separation
- Reimbursement
- Community Liability for Spouse Tortfeasor
- Primary Source of Payment?
- Performing an Act for the Benefit the Community
- CP
- Tortfeasor’s SP
- Not Performing an Act for the Benefit the Community
- Tortfeasor’s SP
- CP
- Non-Tortfeasor Spouse’s SP
- Performing an Act for the Benefit the Community
- Primary Source of Payment?
Three Topics?
(Source)
- Property Acquired Before 1975: Married Women’s Special Presumption
- After 1974: “To H & W” Creates Community Property Title
- Various Presumptions that Arise from Taking Title “In Joint & Equal Form”
Structure?
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(Source: Property Acquired Before 1975: Married Women’s Special Presumption)
- Presumption Arises in 3 Situations Prior to 1975
- Title Taken in Wife’s Name Alone
- Title Taken in Both Names But Not in joint Tenancy Nor as Husband & Wife
- Tenants in Common
- H’s 1/2 = CP
- W’s 1/2 = SP
- Tenants in Common
- Title Taken in Wife’s Name with 3rd Party
- Irrebuttable Presumption Against 3rd Party Bona Fide Purchasers (BFPs)
- Rebuttable Presumption Between the Parties (H & W)
Structure?
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(Source: Various Presumptions that Arise from Taking Title “In Joint & Equal Form”)
- Joint Tenancy
- Prior to 1985 = Joint Tenants
- Intent of CP
- Writing Stating CP
- Post 1985 = CP
- Presumed CP
- Prior to 1985 = Joint Tenants
- Marriage of Lucas - DEATH ONLY
- Presumptions of Deceased Spouse’s Estate
- Joint & Equal Form
- H & W as Joint Tenants
- As Community Property with Right of Survivorship
- Presumptions of Deceased Spouse’s Estate
- Post 1984 Anti-Lucas Statutes (Modified Lucas Rule) - Divorce Only
- Division of Property on Divorce or Legal Separation
- CP Presumption Rebutted Only By
- Express Statement in the Deed, OR
- Written Agreement by the Parties
- Right to Reimbursement
- Principal Payments on the Mortgage
- Improvements
- Down Payments
- Reimbursement Can Not Exceed Net Value of Property
- CP Presumption Rebutted Only By
- Division of Property on Divorce or Legal Separation
Structure?
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(Actions - By Agreement & By Conduct: By Agreement)
- Pre-Marital Agreements
- Requirements
- Must Be in Writing (Statute of Frauds)
- Exceptions
- Oral Agreement Fully Executed
- Estoppel Based on Detrimental Reliance
- Exceptions
- Signed by Both Parties
- Must Be in Writing (Statute of Frauds)
- What Can You Agree To?
- Limiting Child Support = Prohibited
- Limiting Spousal Support = Not Per Se Unenforceable
- Not Represented by Independent Legal Counsel, OR
- Unconscionable at the Time of Enforcement
- Defenses to Pre-Marital Agreements
- Not Voluntarily Signed
- Represented by Independent Legal Counsel or Voluntarily Waived
- 7-Day Cooling Off Period
- Fully Informed in Writing & Language in Which Proficient
- Unconscionable
- Matter of Law
- Tends to Promote Divorce
- Not Voluntarily Signed
- Requirements
- Marital Agreements (aka Transmutation)
- Agreements Before January 1, 1985 = Oral Transmutation OK
- Agreements On or After January 1, 1985
- Writing Required
- Exception: Gifts of Tangible Property of Personal Nature
- Signature of Adversely Affected Party
- Expressly State Ownership Change
- Writing Required
- Statement in Will or Irrevocable Trust Inadmissible Prior to Death
Structure?
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(Actions - By Agreement & By Conduct: By Conduct)
- Mortgage Payments
- Proration Rule (aka Moore Rule)
- Numerator = Principal Debt Reduction Attributable to Community Funds
- Denominator = Purchase Price
- May Be Considered a Gift by the Community
- Proration Rule (aka Moore Rule)
- Life Insurance Policy (Investment Feature)
- Numerator = # of Premiums Paid with Community Funds
- Denominator = Total # of Premiums Paid
- Term Insurance Policy (No Investment Feature)
- Feathering Own Nest = Community Funds Used by One Spouse to Make Improvements on That Spouse’s SP
- Fixtures Doctrines
- Community Reimbursement Claim = Greater of Cost or Enhanced Value
- Community Funds Used by One Spouse to Make Improvements to the Other Spouse’s SP
- Gift
- Reimbursement
- Commingled Bank Accounts
- CP Unavailable
- Two Approaches
- Exhaustion
- Direct Tracing
- Two Approaches
- NOTE:
- CP Unavailable
- SP Used on Family Living Expenses
- Family Expense Presumption
Topics? (7)
(Management & Control)
- Business Exception
- Personal Belongings Exception
- Conveyance of Community Real Estate
- Transfer or Encumber CP
- Gifts of CP
- Fiduciary Duties of Spouses = Highest Good Faith & Fair Dealing
- Contract Liability
Structure?
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(Management & Control: Business Exception)
- Managing Spouse Can Act Alone in All Transactions
- Managing Spouse Must Give Other Spouse Prior Written Notice of Any Sale, Lease, or Encumbrance
- Effect of Failure to Give Notice
Structure?
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(Management & Control: Personal Belongings Exception)
- Written Consent of Other Spouse Required
- Effect of Failure to Get Written Consent = Transaction Voidable by Other Spouse at Anytime
Structure?
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(Management & Control: Conveyance of Community Real Estate)
- Joinder of Both Spouses Required
- Effect of Failure to Get joinder of Both Spouses
- BFPs = One Year Statute of Limitations to Set Aside
- Non-BFPs = No Statute of Limitation
Structure?
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(Management & Control: Transfer or Encumber CP)
- Spouse’s One-Half Interest in CP
- Exception: Family Law Attorney’s Real Property Lien
- Only the Entire Interest in CP May Be Transferred or Encumbered
Structure?
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(Management & Control: Gifts of CP)
- During Lifetime of Gift-Giving Spouse
- Divorce = Misappropriation of CP
- After Death of Gift-Giving Spouse
- Recover From Whom?
- The Donee, OR
- The Deceased Spouse’s Estate
- CP Life Insurance Policy Assigned to 3rd Party
- Recover From Whom?
- US Government Bonds = Federal Preemption
Structure?
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(Management & Control: Fiduciary Duties of Spouses = Highest Good Faith & Fair Dealing)
- Presumption of Undue Influence
- Grossly Negligent & Reckless Investment = Breach of Fiduciary Duty
Structure?
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(Management & Control: Contract Liability)
- Premarital Debt
- Exception: Non-Debtor Spouse Earnings
- Debts Incurred During Marriage
- Community Credit Presumption
- Controlling Test in CA = Primary Intent of the Lender
- Community Assets
- General Standing in the Community
- General Reputation
- Credit-Worthiness
- Contracts for Necessaries
- Reimbursement Claim
- Separated & End of the Economic Community
- Quasi-Community Property
- Post Divorce
- Personally Liable, OR
- Assigned the Debt by Cour
Topics? (3)
(Divorce & Death)
- Community Property
- Quasi-Community Property
- Decedent Leaves Both Legal Spouse & Putative Spouse
Structure?
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(Divorce & Death: Community Property)
- Divorce
- Valuation of CP
- Disparity of Earning Power
- Spousal/Child Support = Yes
- Division of CP = No
- Pro-Rata
- Court Developed Economic Circumstances
- Family Residence
- Stock in Closely Held Business
- Pensions Plans/Retirement Benefits
- Court Developed Economic Circumstances
- Statutory Exceptions
- Misappropriation of CP
- GSA Loans & Other Educational Debts
- Tort Liability
- Personal Injury Award
- Negative Community
- Death
- No Elective Share Statute in CA
- Intestate
- Without Issue = All SP
- One Issue = 1/2 of SP
- Two or More Issues = 1/3 of SP
- Restrictions on Testamentary Disposition
- Separate Property
- Community Property
- Quasi-Community Property
- Probate Definition of Quasi-Community Property
- Widow’s Election
- Take Under the Will, OR
- Take Against the Will
- Debts & Administrative Expense of the Estate
Structure?
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(Divorce & Death: Quasi-Community Property)
- Divorce
- Jurisdiction Over Out-of-State CP & QCP
- Death of Acquiring Spouse
- Jurisdiction Over Out-of-State CP & QCP
- Right to Recover QCP if Inadequate Consideration
- Death of Non-Acquiring Spouse
Structure?
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(Divorce & Death: Decedent Leaves Both Legal Spouse & Putative Spouse)
- Death
- Legal Spouse Deceased