California is a community property state, which means that any property acquired by either spouse during a marriage is considered to be owned by each party equally. Either spouse can identify property as separate, though, and it will remain their sole property if they divorce. Certain actions can transmute or modify separate property into community property, though, and anyone with separate property must take care not to take actions that will impair their rights. In 2015, a California appellate court issued a ruling explaining how and when the character of a property is defined and how to determine if transmutation occurred. If you or your spouse own separate property and you are contemplating ending your marriage, it is prudent to speak to a seasoned California divorce attorney about your rights.
Facts of the Case
Reportedly, the husband purchased a home prior to his marriage. By the time the couple married in 1993, the husband had paid off the mortgage. He also had a retirement account that he contributed to prior to getting married, which he stopped paying into at the time of the marriage. The couple lived in the home but after a few years decided to move to a town called Westlake. The husband retained the separate home, however. He made the down payment for the Westlake home from the separate retirement account and took out a mortgage loan in his name only. The loan application stated that the title to the house would be in the husband’s name, and the deed stated it was granted to him and his sole and separate property.
It is alleged that the husband sold his separate home and used the mortgage proceeds to pay for the Westlake home. The wife filed for divorce twelve years later. A prime point of contention was whether the Westlake home was community or separate property or a combination of the two. The court ultimately ruled that it was community property, and the husband appealed. Continue Reading ›