Effect of How Title is Taken

Question 1

What does Marriage of Lucas stand for?

Answer 1

Taking title as joint tenants meant that the property was presumptively CP.

Unless a contrary agreement is established, the contributing spouse has no separate ownership interest and has no claim for reimbursement.

Question 2

What are the two “anti-Lucas” statutes

Answer 2

STATUTE 1: OWNERSHIP
Property acquired during marriage in joint and equal form is presumptively CP and is subject to equal division on divorce. The CP presumption can be rebutted by: (1) An express statement in an instrument of title that the property is SP, or (2) a written agreement between the parties that the property is SP.

STATUTE 2: REIMBURSEMENT
A spouse who makes SP contributions to the acquisition or improvement of CP is entitled to reimbursement (without interest) for Downpayments, Improvements, or Payments to principal on the mortgage (“DIP”).

NOTE: No right to reimbursement for SP used to pay interest on mortgage, taxes, insurance, or maintenance.

Question 3

HYPO: Using $25,000 of CP funds and $25,000 of his SP funds, H purchases a vacation property for $50,000. On divorce several years later, the property is worth $90,000.

What happens at divorce if the deed names “Harry and W Smith, husband and wife,” as grantees?

What if the deed names “Harry Smith” as grantee?

Answer 3

If deed says “Harry and W Smith, husband and wife”
- STATUTE 1 applies: On divorce, this is CP unless there was an express statement in a deed or written agreement that says otherwise

If the deed just names “Harry Smith” as grantee
- Anti-Lucas statutes do not apply because the property was not taken in “joint and equal form”
- At divorce, half CP and half SP

Question 4

HYPO: Using $5,000 in CP funds and $5,000 of Wanda’s SP, Harry and Wanda purchase a Picasso painting for $10,000. Although the receipt names “Mr. and Mrs. Harry Smith” as the buyers, there is no title document. What happens to the painting if the parties divorce?

Answer 4

Half CP and half SP
- No title document or deed

Question 5

If a spouse makes SP contributions to the acquisition or improvement of CP, are they entitled to reimbursement?

Answer 5

YES (Anti-Lucas Statute 2)

DIP:
Entitled to reimbursement without interest for contributions to Down payments, Improvements, or Payments going to the principal on the mortgage (acronym is “DIP”).

There is no right to reimbursement for SP used to pay interest on mortgage, taxes, insurance, or maintenance.