Division of Property Basics
How property is divided through a divorce is a major factor to be considered when contemplating a divorce. The main consideration is whether property is Community Property, Quasi Community Property or Separate Property, each of which will be treated differently.
Community property is a marital property regime under which most property acquired by a spouse during a marriage (except for gifts or inheritances), is owned jointly by both spouses and is divided upon divorce, annulment or the death of a spouse. Community property is premised on the theory that marriage creates an economic community between the spouses (who may be same- or opposite-sex); and that the marital property attaches to that interpersonal community, rather than to the spouses themselves. (https://en.wikipedia.org/wiki/Community_property) Except as otherwise provided by statute, all property, real or personal, wherever situated, acquired by a married person during the marriage while domiciled in this state is community property. (Cal Fam Code § 760, https://codes.findlaw.com/ca/family-code/fam-sect-760.html) Except upon the written agreement of the parties, or on oral stipulation of the parties in open court, or as otherwise provided in this division, in a proceeding for dissolution of marriage or for legal separation of the parties, the court shall, either in its judgment of dissolution of the marriage, in its judgment of legal separation of the parties, or at a later time if it expressly reserves jurisdiction to make such a property division, divide the community estate of the parties equally. (Cal Fam Code § 2550, https://california.public.law/codes/ca_fam_code_section_2550)
Quasi Community Property
“Quasi–community property” means all real or personal property, wherever situated, acquired before or after the operative date of this code in any of the following ways:
(a) By either spouse while domiciled elsewhere which would have been community property if the spouse who acquired the property had been domiciled in this state at the time of its acquisition.
(b) In exchange for real or personal property, wherever situated, which would have been community property if the spouse who acquired the property so exchanged had been domiciled in this state at the time of its acquisition. (Cal Fam Code § 125, http://leginfo.legislature.ca.gov/faces/codesTOCSelected.xhtml?tocCode=FAM&tocTitle=+Family+Code+-+FAM)
“Separate property” is property that is separate property under Part 2 (commencing with Section 760) of Division 4. (Cal Fam Code § 130) Separate property” does not include quasi–community property. (Cal Fam Code § 2502) The Separate property of a married person includes all of the following:
(1) All property owned by the person before marriage.
(2) All property acquired by the person after marriage by gift, bequest, devise, or descent.
(3) The rents, issues, and profits of the property described in this section.
(b) A married person may, without the consent of the person’s spouse, convey the person’s separate property.
(Cal Fam Code § 770)
Once the parties determine the type of property the division of the Community and Quasi Community Property will be equal 50/50 unless there were other agreements during the marriage. While married the parties may change the character of the property by an agreement called a transmutation. Subject to Sections 851 to 853, inclusive, married persons may by agreement or transfer, with or without consideration, do any of the following:
(a) Transmute community property to separate property of either spouse.
(b) Transmute separate property of either spouse to community property.
(c) Transmute separate property of one spouse to separate property of the other spouse.
(Cal Fam Code § 850) In order to successfully transmute property the agreement must conform to the requirements of the Probate Code,
(a) A transmutation of real or personal property is not valid unless made in writing by an express declaration that is made, joined in, consented to, or accepted by the spouse whose interest in the property is adversely affected.
(b) A transmutation of real property is not effective as to third parties without notice thereof unless recorded.
(c) This section does not apply to a gift between the spouses of clothing, wearing apparel, jewelry, or other tangible articles of a personal nature that is used solely or principally by the spouse to whom the gift is made and that is not substantial in value taking into account the circumstances of the marriage.
(d) Nothing in this section affects the law governing characterization of property in which separate property and community property are commingled or otherwise combined.
(e) This section does not apply to or affect a transmutation of property made before January 1, 1985, and the law that would otherwise be applicable to that transmutation shall continue to apply.
(Cal Fam Code § 852)
If you are a party to a divorce proceeding or are contemplating a divorce you should contact the Law Office of Sam Walker to discuss your options and how the law will apply in your specific situation.