Introduction

Question 1

Introduction - CP and SP

Divorce?

Answer 1

1. CA is CP state
2. All property acquired before/after marriage is SP
3. CP Presumption: All property acquired during marriage presumed CP except

It’s SP if acquired by:
* gift, devise, bequest
* rent, issues, and profit of SP (fruit of SP)
* property exchanged for SP

Upon divorce, spouse can overcome CP presumption:
* show property was one of the above / trace acquisition to SP source (this is how court determines character of asset)
* spouses made agreement that it’s SP
* spouses knowingly took title jointly in form that’s not CP (joint tenancy + collateral written agreement stating property not CP)

Question 2

Introduction - Quasi-CP

Answer 2

QCP is property that would’ve been CP if spouse had been domiciled in CA at time of acquiring it. QCP is treated as CP upon divorce.

If title in name of only one spouse, doesn’t matter

Ex. If property purchased with what would’ve been community funds, the house would have been CP if spouses had been domiciled in California at the time of acquisition. Therefore, property is QCP.

Mere change in form of asset doesn’t change characterization

Question 3

Introduction - Divorce

Answer 3

Upon divorce, community assets are divided equally (in kind)

Question 4

Transmutation

Answer 4

During marriage, spouses can change character of property (called transmutation) by:
1. written express declaration of change
2. spouse whose interest is adversely affected consents
3. Must expressly declare that change in ownership of property is being made

Exception (no writing required)
* Gifts between spouses if (a) item is of personal nature (ex. jewelry), (b) that’ll be used primarily by recipient, (c) item isn’t substantial in value (in context of their finances)

Question 5

SP value goes up

Answer 5

If increase in value is from external factors (and not from applying community $$ or labor) property remains SP.

External factors = market changes, economy, etc.

Question 6

What if character of asset is listed differently on title vs. source of funds used?

What character is jointly held property?

Answer 6

• If (written) title to property is different from funds used to buy property (SP/CP), CA infers intent that property be what’s in written title.
• All property held by spouses in joint form is presumed CP.

Ex: SP to Joint Tenancy

Question 7

Preemption

Answer 7

Under Supremacy Clause, federal law preempts inconsistent state laws. In some instances, federal law preempts CA from applying CP presumption:

Preempted
* Federal homestead claims
* Military life insurance benefts
* US Savings Bonds
* Social Security benefits

NOT Preempted
* Railroad retirement benefits
* Military retirement benefits
* Copyrights