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Community Prop
Definitions
| Question | Answer |
|---|---|
| Community Property | property acquired during the marriage by married persons domiciled in the state. |
| Separate Property | property acquired before marriage and after the date of separation, or during the marriage by will, gift, bequest, or decent. |
| three factors to characterize assets | 1. Source/Source Rule 2. Action (actions by either party that may have altered the character of the property), and 3. Presumptions (Whether there are any statutory or common law presumptions that determine the character of the property) |
| Putative Spouse | one or both spouse believe in good faith that they are lawfully married, but some mistake of law or fact unknown to either or both denies legal sanction. Property is treated as Quasi Martial Property. |
| Meretricious Spouse | Two people living together knowing that there is no marriage. These individuals are subject to contract law and express/implied agreements. Courts can impose a constructive trust or a resulting trust. |
| Quasi community properties (QCP) | assets acquired by a married couple in another jurisdiction that would have been Community if the acquiring spouse were domiciled in California. |
| Source/Source Rule | In determine the division of the assets, the time and manner of the acquisition, tracing, and federal law application must be determined. |
| Action | Have the parties done anything that changes the character of property based on source. |
| Pereira | (Reasonable Return Formula) - Used when it is the labor of the spouse is the reason for the increase. Pereria favors community property Original SP Investment x Reasonable Rate of Return (1.10%)= SP; rest of current value is CP |
| Van Camp | (Reasonable Value of Services) – Used when the property is the reason for the increase. Van Camp favors separate property Reasonable value of spouse’s services (salary x yrs) – salary received = CP; rest of current value is SP |
| Reverse Pereira | Reasonable Return Formula) - Used when it is the labor of the spouse is the reason for the increase. Pereria favors community property Original CP Investment x Reasonable Rate of Return (1.10%)= CP; rest of current value is SP |
| Reverse Van Camp | (Reasonable Value of Svcs) – Used when the property is the reason for the increase. Van Camp favors separate property Reasonable value of spouse’s services (salary x yrs) – salary received = CP; rest of current value is SP This is more equitable. |
| Transmutation | an agreement between spouses to change the character of property. Before 1/1/1985 oral transmutations were allowed. After, 1/1/1985 the agreement had to be in wring, signed by the spouse affected, and expressly state that a change in ownership is made. |
| General Community Property Presumption | all property acquired during marriage is presumed to be community property. However, it can be rebutted by tracing and agreements between the parties. |
| Married Woman’s Special Presumption | (Pre-1975) Property in wife’s separate property before 1975 was considered her separate property. |
| Presumption of Title Held as Husband and Wife | This type of ownership is shown on the face of the deed and it is presumed to be CP. No tracing is allowed, but a written agreement can rebut. |
| Presumption of Property (other than Bank Accounts) Held Jointly | o Death does not apply, then follows deed o Divorce – presumed to be CP; no tracing but a written agreement can rebut. |
| Presumption of Joint Bank Accounts | are presumed to be CP, but tracing can be used (To separate property) unless some written agreement. |
| Apportionment Method Before Permanent Separation or Divorce for Business Properties | components of the business that the managing spouse brought into the marriage and the community property value added by their labors during the marriage, there are two approaches: 1. Van Camp Method 2. Pereira Method |
| Van Camp Accounting Method | is used when the character and good will of the business was the primary reason for its growth and productivity; rather than the managing spouse’s management, skill, and labor. |
| Pereira Accounting Method | The Pereira accounting method is used when the o Management, o Skill, and o Labor Of the managing spouse was the primary cause of the growth or productivity of the business, rather than the character and goodwill of the business. |
| Apportionment Method After Permanent Separtion | after permanent separation, the managing spouse continues to work for the CP business, the business must be apportioned at divorce to reflect the value of the CP capital and the managing spouse’s SP labor. Reverse Van Camp and Pereira. |
| Prenuptial (pre-martial) Agreement | An agreement made before marriage, usually to resolve issues of support and property divisions if the marriage ends in divorce or death. Parties may bypass the CA CP system by this agreement. Must be in writting and signed by both parties after 1/86. |
| Oral Prematrital (pre-marital) Agreement enforcement | The agreement may be enforced when: • The executor promise was fully executed by the promisor, or • The promisor relied to the detriment on the agreement. |
| Equal Division Rule | each spouse is entitled to ½ interest in each CP asset. An exception applies where economic circumstances warrant an award to another party to achieve a substantially equal division, such the loss the home may uproot the couple’s minor children. |
| Deliberate Misappropriation Rule | requires that if a spouse intentionally misappropriates the other spouse’s interest in CP or QCP, the court can award the property or its value t the non-misappropriating spouse. |
| Retirement Pensions | are community property to the extent the right to the benefit was earned during marriage. Upon divorce, when it matures both parties have a right to recieve the benefit. |
| Disability Pay or Worker's Compensation | A worker may receive disability pay and worker’s compensation when they are no longer able to work on account of general physical disability or they are unable to work because of a job related injury. During marriage it is CP, after marriage it is CP. |
| Gifts of Separate Property When Separate Property is Used | When separate property is used to pay family expenses, a gift to the company is presumed. The separate estate has no right of reimbursement when community funds are later deposited. |
Created by:
jsarille