<p>calmom - so what is the answer to your question anyway?
Can you tell us?</p>
<p>Alumother, the answer is that the parties would have to litigate that one out in court. They would have to establish where the husband got the money to make the mortgage payments - if it came from a separate property asset (a bank account he had before marriage, earnings derived from other separate property, such as rental income from a different piece of property owned before marriage) – then it would be separate property. If it came from a community property source of income - like his earnings - then the value of would have to be allocated to determine the wife’s interest in the property. This would probably also require using a mortgage amortization table, to allocate between principal and interest payments. As to whether that would merely give the wife an interest equal to the value of contributions (i.e. payments to principal), or a proportionate share of the market value of the appreciated property - I don’t know,and I don’t know what formula would be used to ascertain it. (It’s not explained in the Family Code, and I never specialized in divorce law - I only handled a few uncontested divorces, and referred the otherse to the specialists.). </p>
<p>It gets worse – suppose that at some point of time, wife inherited $20,000 when a relative died. Separate property. Lets say husband is short of money, and wife gives him $10K which he uses to pay down the mortgage on the property. OK, now this gives her a different interest, but first you have to figure out what the wife’s intent was when she gave him the money. Is it a gift? (If so, maybe it becomes his separate property, and she has relinquished both her separate interest and or community interest). If she first deposited the $20K into their joint bank account, and he wrote the check from there - then maybe her separate property was transmuted into community property, and there’s a community property interest. What if he later sold a piece of separate property, and gave wife $10K from that? Maybe the whole thing was a loan that has since been repaid. </p>
<p>What about improvements to the property? and the source of money for such improvements? Those would certainly affect the value. What if the money for an improvement came from insurance proceeds for a loss, such as a fire, but the improvement nonetheless results in an increase to property value beyond what it would have been in its original state. And for that matter, where has husband been getting the money to pay for the insurance premiums on the property?</p>
<p>So both the long and the short answer is : I don’t know, and these are the things that can be litigated for days on end in a courtroom. Usually, when there is not much money overall, the parties do resolve it through mediation, with the goal being to come to an amicable resolution, not necessarily a 50/50 split. It’s easier to divide up a list of nonliquid assets by agreeing who will become the owner of each than to work out all the figures. If the property is very high value, then of course it becomes more worthwhile to litigate. </p>
<p>On top of everything else, there may be a prenuptial or antenuptial agreement involved – we have no way of knowing. </p>
<p>Obviously the husband has a reason for claiming that these holdings are his separate property – but we can also assume that Tlaktan’s parents probably have been married for his lifetime, at least 18 years - and it is hard to see how H could have also maintained a wholly separate property interest in a company that he owns - since earnings during marriage are supposed to be community property.</p>
<p>Calmom - this almost reads like a law school exam question. :)</p>
<p>For what it’s worth, I agree entirely with your assessment, especially the last paragraph. I find it hard to fathom that he could have paid for and maintained the property entirely with funds which would not be community property - some part of his salary or investments or whatever must have paid for this.</p>
<p>Aries, I admit to intentionally framing it that way out of frustration with Zagat’s claim that it is all resolved via simple “black and white” formulae. I was thinking “bar exam” actually - I never took community property in law school, just picked it up from the bar review course, and of course had to answer a question about it on the exam. To this day I still remember the basic question - it was a palimony question back in the days when the whole idea was new. </p>
<p>But obviously, in the law, nothing is ever “black and white”. My ex and I, both being lawyers, never even bothered with the formulas - it was way beyond what either of us could figure out, as I has separate income from inheritance all the way through our marriage, and we knew that whatever amount could be in dispute was less than the amount we would pay lawyers and accountants to figure it all out. That’s what legal training does - it doesn’t tell us the answers, but it sure as heck gives us the ability to figure out all the questions. </p>
<p>I really think that Tlaktan’s father might have persuaded the mom to sign an antenuptial agreement somewhere along the line, supporting the separate property claim. There may also be reasons why she wanted it separate – Tlaktan mentioned a history of gambling debts, and so its possible that at some point loans were taken out against properties to pay outstanding debts and she wanted to be insulated from liability on the loans - so signed away her interests. Of course, its also possible that she signed something without a clue as to what it said, given the language difficulties – another can of worms to be sorted out in court. On the other hand, given the debt picture, it may be that those properties are mortgaged to the hilt and aren’t worth that much in any case.</p>
<p>Hadn’t seen Zagat’s post… but I do agree that there are a host of issues. Somehow, property taxes, mortgage, and maintenance have to be paid, and, if they are paid w/ community property, then both spouses have an interest* in it. At least that’s what I learned in law school property. ;)</p>
<p>*Not ownership - I believe that the other spouse could ask for reimbursement (direct dollar amount repayment) or some sort of share of improvement (so if a $15,000 renovation added $30k to the value of the house, that $30k is community…?). </p>
<p>Even if it was separate property, it could be commingled eventually, right? Or does that vary by state?</p>
<p>It is funny though - just reminds me of a law school question. Spot the issues, frame the questions, and you can then figure out what facts you would need to ascertain the answer.</p>
<p>As an attorney, I would have to agree that California divorces are very straight forward. A judge will quickly throw out specious claims of ownership. Divorce lawyers feed on the hate, not the difficulty. In some states, they earn their keep. A partner of mine is divorcing in NY. Married since he was 21, his wife worked to put him through law school. In New York State, this makes her part owner of his law degree! They will have to litigate to find what percent she owns as the law does not specify. Nothing like this in California, people who see the light will save a fortune by cooperating.</p>
<p>Aries, on top of everything else, separate property can be converted to community property by certain conduct – so for example, if a spouse inherited $100K, deposited it in a joint account, then withdrew the money a month later to purchase a piece of real estate – the money could be deemed to have been transmuted to cp by the deposit to the joint account. The problem, of course, is that people don’t think about this at the time they are doing it, and rarely keep records going back all that far. This is the kind of thing that keeps lawyers very busy with discovery and depositions.</p>
<p>Kirmum – I didn’t practice divorce law, but I did do fee arbitrations in divorce cases – where the client was contesting the amount the divorce lawyer charged – which meant that I had to go over the billings and charges. You would be amazed at how complicated the “straightforward” process of divorce in California is. What is “straightforward” in California is the fact that divorces are no-fault – so there is never any litigation over claims of adultery or abandonment, etc. - and those claims won’t change the landscape in terms of property interests. But a claim of fraud will make a difference, so sometimes there can be a lot of litigation about who knew what about which money was spent when. Usually issues get ironed out pre-trial, but not without a lot of work – instead it’s a matter of a lot of discovery, and narrowing down of issues through negotiation or pre-trial motions. There is also a procedure in California that allows the dissolution of marriage to be finalized while leaving the trial of the property claims open to be determined later – which might lead to the perception of the process being simpler than it really is.</p>
<p>Calmom & Kirmum - thank you for sharing your knowledge. :)</p>