Property Division in a Community Property State (Like California)

Property Division in a Community Property State (Like California)

When Julie and Jackson married, they were both in their early 30s. Both were successional professionals who had lived on their own for years. After an 8-year marriage, they decided to divorce. Then the fun began – each had brought assets and debt into the marriage. Together, they had continued buying real estate, art, books, automobiles, and household goods. Their attorneys advised them of how property division works in community property state like California. Of course, they had never given it much thought until their divorce. Julie and Jackson were not sure whether their belongings were community property or not.

State Laws on Property Division

Each state in the United States has its own divorce laws, including laws about dividing the divorcing couple’s assets and debts. There are two primary ways to split marital property:
  • Equitable Distribution. Most states follow this type of property division. Courts grant marital assets to the parties as a fair and equitable distribution.
  • Community Property. A few states use the community property system. It is assumed that the spouses have equal interests in the marital property. Assets – and debts – may be split equally between the parties.
States even differ in the way they hand equitable distribution and community property. That’s why it is important to understand the laws of your state.

How Community Property Works in California

Deciding what is ‘property’ may be the first step in a divorce. Generally, property is anything that can be bought or sold or anything that has value. For example, Julie and Jackson own a house and each has a 401(k) plan. The house can be bought or sold, and the 401(k) plans have value. Therefore, the house and 401(k) plans are property that will be divided as part of the divorce settlement. A couple may negotiate a marital settlement agreement that splits their property to their satisfaction. Even so, it’s a good idea to have an experienced divorce attorney help. It’s not always easy to figure out what is property, community, or otherwise. If the parties are unable to reach an agreement, a court will divide their property based on California community property laws. According to California Family Code, courts generally start with the presumption that the couple’s community property will be divided equally. However, courts may weigh in on whether an asset is separate or community property. Also, the court may award more than 50% of the assets to one spouse based on “economic circumstances.” When one party commits domestic violence or misappropriates funds, courts also have the discretion to award more assets to the innocent spouse.

Community Property Division Is Not Always Easy.

Finding assets and determining their value, as well as whether the asset is separate property or community property, requires deep knowledge of California divorce laws. Judy Burger is a California Certified Family Law Specialist, and founder of the Law Offices of Judy L. Burger. Please call our offices at 415-293-8314 to set up an appointment with one of our attorneys. We assist clients along the Northern to Central California Coast.
When Your Spouse Has Multiple Residences

When Your Spouse Has Multiple Residences

Larry and Gina married in Texas but lived in several states during their 28-year marriage. In fact, they still jointly owned houses in Texas, Pennsylvania, and Illinois. The couple enjoyed the extra income from renting the properties and hoped to retire to one of the properties one day. When Larry decided to file for divorce, he was living in California while Gina still lived in Illinois. He wasn’t sure how to handle a divorce when he and his spouse have multiple residences, in multiple states. This sticky situation arises more frequently than you might imagine.

Residents of California

To file for divorce in California, you must meet the following residency requirements:
  • You must have lived in California for the last 6 months; AND
  • You also must have lived in the county where you plan to file for at least the last 3 months.
Notice that only the person filing the divorce is held to these residency requirements. Problems occur when one spouse lives out of state or the couple own property in more than one state. However, filing the divorce petition is only the first step in the process. At some point, the parties will have to consider how to divide property that is not located in California.

Property Outside of California

California courts typically do not have the power to control property located in other jurisdictions. While the judge can make decisions about a divorce case filed in California, it may not have the power to divide out-of-state property. This situation is called a divisible divorce. It may be necessary to hire attorneys practicing in states where the other property is located to handle property division.

Divorce When Your Spouse Has Multiple Residences Can Get Complicated

You may have to give careful consideration about the best jurisdiction in which to file your divorce. Discuss your options with an experienced divorce attorney as soon as possible. Judy Burger is a California Certified Family Law Specialist, and founder of the Law Offices of Judy L. Burger. Please call our offices at 415-293-8314 to set up an appointment with one of our attorneys. We assist clients along the Northern to Central California Coast.
What Is “Property” in a Divorce?

What Is “Property” in a Divorce?

We all own ‘stuff.’ Sometimes we get quite attached to that stuff, which makes it that much more difficult to divide it up during a divorce. Both parties may want an item and have trouble deciding whether it is considered property in a divorce. Basically, property is anything that can be bought or sold or has a value. However, the question may become more complex during the property division stage of a divorce.

Community Property vs. Separate Property

Generally, courts consider most property (and debts) accumulated during a marriage to belong to both parties. However, this is not as cut and dried as it may seem. For example, an inheritance one spouse receives during the marriage may remain the separate property of that party. Sometimes separate property may become mixed with community property during the course of the marriage. Hard decisions have to be made, then approved by the court.

But Is it Really “Property”

Generally, we think of personal property and real property. Some possessions may not be thought of as property, though, especially when it comes to splitting them between spouses. That said, you might expect the following items to be personal property:
  • Furniture,
  • décor,
  • collections, like wine or art,
  • appliances,
  • clothes,
  • jewelry,
  • books, and
  • other personal effects.
However, personal property also may include:
  • bank accounts,
  • retirement accounts,
  • investment accounts,
  • vehicles, including boats, cars, and airplanes.
Real estate, or real property, may include:
  • Your home,
  • Commercial property, and
  • investment property.
We sometimes don’t think of our belongings as “property” in a divorce, property that needs to be split. For example, Margie never considered her husband’s tool collection as property  — until she filed for divorce. And Liam never thought his wife’s art collection was a big deal, but then it became property to be appraised during their property division negotiations. Whether you consider items to be property or not, be aware that they may figure into your divorce settlement.

Final Thoughts on Property in a Divorce

Determining whether a possession is community property or separate property makes a difference in property division. It’s also important to know the value of your property before dividing it up. You need an attorney who understands simple to complex property situations. To discuss how to handle property and divorce issues, please call us at 415-293-8314. The attorneys at the Law Offices of Judy L. Burger assist clients in San Francisco, Beverly Hills, Marin County, Santa Barbara, Ventura/Oxnard, San Jose, Gold River (Sacramento), and surrounding communities.
Dads and Divorce

Dads and Divorce

There’s no denying that fathers are important in their children’s lives. In fact, studies have shown that a dad’s relationship with his children impacts their emotional and social development, as well as their future success. That important bond may become estranged when moms and dads split up. When it comes to dads and divorce, men have the same rights and obligations when it comes to custody and visitation agreements.

Custody and Visitation:  What Judges Want to See

In the past, mothers often were given preference in custody decisions. However, California courts famously rule ‘in the best interests of the child’ for child-related issues. Sometimes handing custody to the moms is not best. When considering moms, kids, dads and divorce, judges look at several factors to find the right custody and visitation arrangements:

  • The age and health of the children;
  • Emotional bonds between parents and kids;
  • Each parent’s ability to adequately care for the kids;
  • Family violence or substance abuse incidents; and
  • The children’s relationships at school, at home and in their community.

Fathers who bond with their children, who can support their children, and who have a clean record generally are likely to get favorable custody and visitation arrangements.

Father’s Rights Include Child Support

The financial obligations of raising children are not the responsibility of only one parent. In fact, both parents are expected to provide financial support for their kids.

When fathers have primary legal or physical custody, they have the right to expect child support from the children’s mother.

Parental Responsibilities in a Divorce

Kids should never be pawns sacrificed so one parent or the other can ‘win’ the divorce battle. Moms and dads alike should focus on what is best for their children. So, it’s important to remember what was mentioned above – fathers are important in their children’s lives.

Both parents have the responsibility of supporting their children. However, support comes in many forms, which includes just being there for the kids.

Dads may level the custody-and-support playing field by:

  • building and maintaining relationships with their children;
  • obeying all court orders regarding the kids;
  • make acting in the best interests of their children their top priority.

Learn More About Dads and Divorce

Dads, you don’t have to give up your kids just because your marriage ended. You can have awesome relationships and liberal custody arrangements. Considering a father’s influence over his children, it’s certainly a relationship worth protecting.

The attorneys at the Law Offices of Judy L. Burger are experienced at all phases of divorce proceedings. Call us at 415-293-8314 to schedule a private appointment or visit our website. We maintain offices in San Francisco, Beverly Hills, Marin County, Santa Barbara, Ventura/Oxnard, San Jose, Gold River (Sacramento), and surrounding communities.
My Spouse Lives in Another State. Where Should I File for Divorce?

My Spouse Lives in Another State. Where Should I File for Divorce?

There are times when a divorce crosses state lines. For example, Cynthia and George married in California, then moved to Iowa. After two years, Cynthia abruptly returns to California, leaving George, their condo, most of their furniture, and an automobile back in Iowa. She intends to file for divorce immediately. However, since her spouse lives in another state, she’s left wondering where she should file for divorce – California or Iowa?

Residency Matters

Each state has its own laws and rules about filing for divorce. For example, Iowa requires the person filing for divorce to live in state for 365 days to become eligible to file for divorce. There’s no in-county minimum residency. Had Cynthia stayed in Iowa, she could have filed for divorce since she had lived there more than 365 days.

However, in California, the rules are quite different. The person filing the divorce petition must meet the following residency requirements:

  • Must have been a resident of the state of California for at least six months prior to filing the petition.
  • Must have lived in the county where the divorce petition is filed for at least three months.

The rules are a bit looser for same-sex marriages. In some cases, neither partner has to be a California resident. A dissolution may be allowed if the parties live in a jurisdiction that will not recognize or dissolve their union.

Cynthia has not resided in California for six months, so she does not meet the residency requirement. However, she desperately needs to find a way to separate from George.

Other Options

In California, marriages may be terminated in one of three ways: divorce, annulment, or legal separation.

Unlike divorce, there is no residency requirement for filing for a legal separation. In addition, a legal separation may take place as soon as one party files the paperwork with the court. This option may provide some protection for the parties until they have lived in California for at least six months.

Cynthia decided to obtain a legal separation, then convert it to a divorce proceeding once she had lived in California for six months.

Long Distance Divorce Can Be Difficult

The attorneys at the Law Offices of Judy L. Burger are experienced at all phases of divorce proceedings. Call us at 415-293-8314 to schedule a private appointment or visit our website. We maintain offices in San Francisco, Beverly Hills, Marin County, Santa Barbara, Ventura/Oxnard, San Jose, Gold River (Sacramento), and surrounding communities.
Preparing for Your Court Hearing

Preparing for Your Court Hearing

Many people fear the unknown. Since some of us go our entire lives without entering a courtroom other than for jury duty, attending a hearing can be incredibly stressful. It doesn’t have to be so bad. Just talk to your attorney while preparing for your court hearing. You may learn some tips for understanding the unknown that will make your experience easier.

First, the Basics

California family courts typically are less formal than other courts. However, the judge in a family court does expect certain behavior from people taking part in the court proceedings.

  • Dress appropriately. Most courts have a dress code. For example, your judge’s dress code may require that your clothes are clean and prohibit baggy clothing, hoodies, tank tops, shorts and short dresses and inappropriate footwear like flip flops.
  • Get some sleep the night before. Sleep deprivation may make the entire process more difficult.
  • Make sure you’re on time. This is so important. Being late may give the court the wrong impression. Plan your route and where you will park beforehand, then leave the house a little early.

Courtroom etiquette is a set of rules that says how the court wants you to behave in the courtroom. Here are some dos and don’ts for courtroom attendees:

  • Don’t bring gum, food, and drinks into the courtroom.
  • Don’t bring cameras, tape recorders, or devices that play music.
  • Do turn off your cell phones and pagers.
  • Don’t text message.
  • Do take off your hat and sunglasses.
  • Do be courteous and respectful to everyone you meet. It never pays to be rude to a court clerk, bailiff, or judge.

Additionally, there are some things you can do in the weeks leading up to your hearing.

A Few In-Depth Tips

Once you have the basic information in hand, start thinking about the big picture by:

  • Reviewing the documents you have filed in your case.
  • Reviewing the documents your spouse filed.

Anything your attorney gives you to read gets top priority, of course.

And Some Final Thoughts

It really comes down to listening to your attorney. Ask questions, then follow your attorney’s advice.

To discuss your divorce, please call us at 415-293-8314. The attorneys at the Law Offices of Judy L. Burger assist clients in San Francisco, Marin County, Santa Barbara, Ventura/Oxnard, San Jose, Gold River (Sacramento), and surrounding communities.
Emergency Issues, Ex Parte Solutions

Emergency Issues, Ex Parte Solutions

Some divorce cases require immediate action. California law allows this through the use of Ex Parte solutions.

What is an ex parte solution?

An Ex Parte solution is a Motion that is filed with the Court that does not require the usual waiting time. In some counties, a motion may be heard within 24 hours. Usually, notice to the opposing party or counsel must be given and must adhere to the particular County’s notice requirements.

The main reason for filing an ex parte divorce is to get your case in front of a judge as quickly as possible because of an emergency situation.

What kind of emergency situations require an ex parte action?

An ex parte action might be filed for any of the following reasons:

  • The person filing the ex parte divorce is in danger,
  • A child involved in the case is in danger, or
  • Property owned by the filing spouse may be destroyed or damaged.

What is the procedure for filing for ex parte divorce orders?

The procedure and documents required for an Ex-Parte Motion are complex and confusing. Each county has different requirements and procedures. If you fail to adhere to the county’s requirements or procedures, your motion may be denied.

Find out if your situation requires an ex parte hearing.

Judy Burger is a California Certified Family Law Specialist, and founder of the Law Offices of Judy L. Burger. Please call our offices at 415-293-8314 to set up an appointment with one of our attorneys. We assist clients along the Northern to Central California Coast.

Settlement vs. Litigation: Which Is Right for Your Divorce?

Settlement vs. Litigation: Which Is Right for Your Divorce?

There are many reasons to file a divorce. Take Henry and Martha. After raising four children during their 31-year marriage, they decided to join the “gray divorce” crowd. Jake and Lucy, married four years ago, had one child together before Jake’s infidelity and substance abuse drove them apart. Both of these couples had some heavy decisions ahead. As their cases progressed, they had to decide whether settlement or litigation was best for their divorce.

Two Pathways.

The parties in most divorce cases are able to reach a divorce settlement agreement. The couple and their attorneys may negotiate privately or go to mediation. Though it is similar to a trial in that both parties present their side, mediations proceed very differently. 

For one thing, agreements reached in a mediation are confidential. Court proceedings are not, although courts can restrict who can view divorce court records. In Jake and Lucy’s case, privacy was a big concern. Lucy did not want Jake’s infidelity and drug addiction publicly aired.

Unfortunately, trial became a necessity for Henry and Martha. A lifelong homemaker, Martha had never worked outside the home. She expected spousal support to continue for some time. Henry, however, felt she deserved nothing because he had been the family’s breadwinner for their entire marriage. Both stubbornly stuck to their positions and refused to compromise.

When Is Settlement Right?

Some couples are in a position to settle their differences quickly. For them, settlement through negotiations or mediation typically is faster than going through the court system. They don’t have to wait for space to clear on a court docket to schedule hearings.

Divorce strains family relationships. Mediation may be less destructive on those relationships because they are typically less combative than trials.

Couples going through a divorce may have financial problems. Mediations and settlement negotiations are usually less expensive than going to trial.

When a settlement agreement is presented to the court, the judge will make sure the document complies with California law. However, many of the agreements contained in the settlement agreement do not require a judge’s scrutiny. Couples may hammer out agreements that suit them, but that most judges would not arrive at.

 

If negotiations and mediation fail, divorce proceedings go to the next level.

When Is Litigation the Best Option?

Some parties may be unable to resolve their issues without court intervention. So, they settle in for the long haul. They may be expected to attend several hearings or even participate in a trial that lasts for days.

Going to trial sounds terrible! So why do some couples end up battling it out in a courtroom?

Divorces with more complex issues are more likely to go to trial. What makes a divorce more complex? Among other things, disputes over property division that can’t be overcome. Inability to agree on hot issues like child custody or spousal support could end up in a courtroom.

Trial may be necessary if domestic violence or child abuse is involved. A judge has the authority issue orders that protect the abused spouse or child, something neither an attorney nor a mediator can do.

Some spouses make unreasonable demands or have unreasonable expectations. In cases where this is an issue, unfortunately, a trial usually becomes necessary.

Final Thoughts.

The attorneys at the Law Offices of Judy L. Burger can help, whether your case is settled or goes to trial. Call us at 415-293-8314 to schedule a private appointment or visit our website. We maintain offices in San Francisco, Marin County, Santa Barbara, Ventura/Oxnard, San Jose, Gold River (Sacramento), and surrounding communities.
Valuing Business Assets

Valuing Business Assets

Dana and Michael owned a successful dentist practice with three locations. When their marriage foundered, the practice was in jeopardy. Dana was the dentist, with Michael serving as office administrator. Dana wanted the entire practice and, since that was her expertise, it made sense. Michael wanted other community property that equaled his half of the value of the practice. As is true with many divorces, valuing business assets became a contentious part of their divorce proceeding.

In any divorce, community assets are determined and then split. The divorcing couple may be able to iron out a divorce settlement that suits them both. However, when agreement cannot be reached, the courts decide who gets what. The final divorce settlement or judgment will take into account the value of the business.

What Courts Consider

The parties need to know what kind of information the court will be reviewing to come up with that final valuation:

  • The fixed assets of the business,
  • The accounts receivable and intangible assets,
  • Goodwill customers and vendors have toward the business, and
  • Debts and liabilities.

In most cases, courts may want answers to questions like:

  • What type of business is involved?
  • How did the business start?
  • What is the current financial condition of the business?
  • What is the book value of the business?
  • How much can the business expect to earn?
  • Does the business pay dividends or not?
  • How much is the company’s goodwill worth?
  • Have any other ownership interests been sold?
  • If the company is publicly traded, what is the stock worth?

So, it’s a given that if the business is community property, some type of value must be assigned. Otherwise, how will the court know how to divide the community property estate?

Methods of Valuation

The ways used in business valuation may depend on the type of business being valued. A real estate agency may be valued differently than a convenience store or car dealership.

For example, some types of business may best be valued by looking at comparables. Looking at comparable businesses may be useful when coming up with an average value of that type of business. For Dana and Michael, an appraiser may look at the value of dental practices of a similar size in the same area.

The liquidation value tells you how much the company is worth if it is sold. If Dana and Michael are unable to reach an agreement, they may consider selling the practice and splitting the proceeds.

Determining capitalized earnings is a common way of evaluating businesses in California divorces. This method uses the current cash flow, annual rate of return, and expected value of the business to come up with a final figure.

It’s Complicated

The attorneys at the Law Offices of Judy L. Burger are experienced at all phases of divorce proceedings, including business valuation. Call us at 415-293-8314 to schedule a private appointment or visit our website. We maintain offices in San Francisco, Marin County, Santa Barbara, Ventura/Oxnard, San Jose, Gold River (Sacramento), and surrounding communities. Our new Beverly Hills office will open soon.
When One Spouse Has Serious Health Problems

When One Spouse Has Serious Health Problems

After 28 years, Olivia and Simon’s loveless marriage sputtered to an end. Before they could finalize their divorce, however, Simon learned he had Stage 2 prostate cancer. He and Olivia needed time – and the advice of their respective counsel – to assess the affect his serious health problems had on their divorce.

Health Insurance and Medical Bills

People in the middle of a divorce proceeding may be concerned about one of their biggest expenses – health insurance. This is especially true if one spouse has been paying the insurance premium for the other. Each divorce may be decided on a case-by-case basis.

In some situations, the insured spouse may continue paying their ex-spouse’s premiums as part of their settlement. In fact, the California Family Code states that health and medical insurance should be maintained until the divorce has become final.

Some couples may decide that the uninsured spouse should seek COBRA coverage. This option, though expensive, may be necessary if one of the spouses has a serious medical condition.

In a community property state like California, marital assets and marital debts are split between spouses. Medical bills incurred during the marriage, then, are likely to be considered the responsibility of both spouses.

Mental Health Concerns

If one spouse is mentally ill or lacks the ability to make decisions, the other spouse can usually obtain a divorce. The court may require medical examinations before granting the divorce. Also, just because one spouse suffers from mental illness does not mean the other spouse receives more of the marital property. Assets and debts still become part of the marital property.

Estate Planning

A complete estate plan typically includes a financial power of attorney, a living will, and a Physician’s Order for Life-Sustaining Treatment. Parties to a divorce should make sure their estate planning documents are updated, especially when one partner is ill.

For example, when Olivia and Simon finalize their divorce, they need to change their estate planning documents. It’s especially important for Simon to prepare estate planning documents that relate to medical and financial decisions because his medical condition may require others to make medical decisions for him. If he named Olivia as his agent, she most likely will no longer want to serve.

Call to Learn More About Preliminary Financial Disclosures and Your Divorce.

In addition to legal decisions, Olivia faced tough moral and ethical dilemmas. People dealing with a divorce and a seriously ill spouse may decide to continue with the divorce, stop the divorce, or file for legal separation until they decide what is best. An experienced California divorce attorney can suggest options that are right for your situation.

Judy Burger is a California Certified Family Law Specialist, and founder of the Law Offices of Judy L. Burger. Please call our offices at 415-293-8314 to set up an appointment with one of our attorneys. We assist clients along the Northern to Central California Coast.