Who Gets the Family Home in a California Divorce?
California Divorce

Who Gets the Family Home in a California Divorce?

In a divorce, one of the most significant concerns is what will happen with the family home. This is particularly true when minor children are involved.

The family residence is often the largest asset owned by the parties to a divorce, so the financial interest is often significant. In addition, there can be a sentimental attachment to the home. For these reasons, dividing the parties’ interest in the family home can be easier said than done. The first task is to decide who actually owns the house. You can learn more about determining basic ownership interests here.

 It is not always easy to apply property law when dividing the family residence. For instance, what happens if the down payment was made with separate property funds? What if both parties contributed to pay down the mortgage while they were married, but the home is titled in just one name?

When there is a community property interest in the residence, there are three basic ways it can be divided: (1) sell the property outright and apply the profits toward the couple’s community property estate, to be divided; (2) one spouse buys out the other’s interest, assuming the purchasing spouse has adequate funds or credit to do so; and (3) deferred sale.

The first two of these options are fairly straightforward. However, a “deferred sale of home order”, also known as a “Duke” order (named after a significant case on the issue), requires some explanation. Deferred sales are usually considered when the parties have minor children and want the children to be able to stay in the family home until a later date. A custodial parent, in these situations, is given exclusive use and possession of the home on a temporary basis so that the kids can stay there.

 In determining whether to allow a deferred sale, the family court must first consider whether it is economically feasible to do so. The court must balance the relative hardship of the parent and children staying in the home with the hardship placed upon the parent no longer living there. The law requires that certain factors be considered in making these determinations. It also requires that the deferred sale of home order contain an end date, such as the date the youngest minor child attains the age of majority or graduates from high school.

In addition to the disposition of the home, the family court will have to determine whether one party must reimburse the other for “contributions for the acquisition of property”. These reimbursements may be required if one party made the down payment on the family residence out of separate funds. They may also be required if separate funds are used to pay down the principal on the home.

As you can see, many factors impact how the family residence is handled in a divorce. How these issues are presented can significantly affect your outcome. Judy Burger is experienced in complex property division matters and how to present those in family court. Please contact her today at (415) 259-6636.
How Are Stock Options Divided in a California Divorce Proceeding?
California Divorce

How Are Stock Options Divided in a California Divorce Proceeding?

When a couple divorces, it is easy to divide physical items. One of the parties simply takes possession of items such as home furnishings, tools, jewelry, and even cars. Other property is more difficult to evaluate and divide. This is the case with employee stock options.

Stock options are granted by a company to an employee, usually managers and executives. Stock options represent the right of the employee, at some point in the future, to purchase company stock if he or she chooses to do so. Sometimes, a company gives an employee stock options to attract the employee to come to work for it; other times, a company offers stock options to try to keep an employee or to compensate him or her for future work. If and when a stock option “vests”, the employee has the right to buy the company’s stock.

A basic understanding of property rights in California is essential to understanding how family courts deal with stock options. You can learn more about these rights here.

In addition to understanding basic property law, it is important to understand what the term “vest” means in relation to stock options. The date a stock option “vests” is the date upon which an employee has the right to buy the stock. This is known as “exercising” the option right.

The first step in determining how to handle stock options in a divorce is deciding who owns the option. Courts have broad discretion on how this is done. However, two different approaches are typically used, both of which are named after the cases that established them. They are known as the Hug formula and the Nelson formula; they are also known as time rules. In essence, the sooner after the date of separation an option vests, the larger the community interest in them.

Which formula is applied, usually depends on the reason the company offered the stock option in the first place. The Hug formula typically applies to options that were given to the employee to attract him to work. The Nelson formula is usually used when the options were offered to keep an employee or to compensate him for future work. While many people assume that options that vest after the date of separation are separate property, this is simply not true when the Nelson time rule is applied.

Valuing stock options properly requires an attorney who understands all the law and who is experienced in making the strongest arguments for her client. To obtain the counsel of just such an attorney, please contact the Law Offices of Judy L. Burger. We have extensive experience in divorce, child custody, and child support matters. Call today to learn more: (415) 293-8314.
California Divorce

Basic Property Rights Law in California Divorces

Understanding the basic rules of property ownership in California is critical for anyone going through or contemplating a divorce or legal separation. Property may be owned by a spouse separately, meaning that it is his or hers alone, or it may be held as community property, which means that both spouses share it equally. It is important to understand the difference because, generally, a spouse has no right to any portion of the separate property of the other. On the other hand, California law provides for equitable division of community property.

Property acquired before a marriage or after a married couple separates is considered to be separate. In addition, property given to or inherited by a party during a marriage is considered to be separate. In most cases, a person has no right to the separate property of his or her spouse.

California law assumes that property acquired during a marriage is community property, which means that each spouse holds a one-half interest. Both spouses have an ownership right to one-half of community property, regardless of who actually acquired the property. In determining whether property is separate or community, the date of separation is critical. In fact, the date of separation is sometimes hotly contested for this reason. The date of separation is established, by law, as the date on which two things occurred: (1) one spouse subjectively made the decision that the marriage was over; and (2) that spouse took an objective step to implement his or her decision.

With titled assets, such as homes, cars, and boats, a second property law presumption may come into play. The California State Legislature has passed a law that the“owner of the legal title to property is presumed to be the owner of the full beneficial title”. This means that a court will assume that the name of the person on title to property is the full owner of that property. It takes strong evidence to overcome this presumption.

As you might imagine, the community property presumption and the legal title presumption can often be in tension with one another.

There are many nuances in California statutory and case law that impact property division, and the proper presentation of property issues can significantly affect your outcome. Judy Burger is experienced in complex property division matters and how to present those in family court most favorably to her clients. Please contact her today at (415) 259-6636.
California Divorce

Taking Your Ex Back to Court to Collect Your Fair Share

MoneyvLove Some divorces can be accomplished in what seems like a blink of the eye.  Oftentimes, a young couple without children or assets to speak of simply needs to sign a few legal documents to go their separate ways.  But as years go by and marriages get longer, divorces get more complicated as children are born and assets are accumulated. Such was the case with Frank and Jamie McCourt. At the time of their divorce, Frank was the owner of the Los Angeles Dodgers. In determining Jamie’s stake in the family assets, Frank estimated the value of marital assets, including the Dodgers franchise, at roughly $300 million. Eventually, the divorce was finalized in October of 2011and Jamie was awarded $131 million. Not exactly half, but not too shabby, either. A mere six monthly later, however, Frank sold the Dodgers franchise for a whopping $2.15 billion. (That’s right, billion with a ‘B’). Jamie promptly took Frank back to court, feeling she had been cheated out of her fair share. Among other things, Jamie alleged that Frank grossly undervalued the business. Situations like this are not uncommon, particularly when the marital assets include a business. An experienced and pragmatic divorce attorney understands the importance of a fair business valuation conducted by a qualified expert. Be sure your attorney is prepared with the facts so you can get your fair share the first time around. If you feel like your spouse took you to the cleaners in your divorce, before giving up, consider your options for taking your ex back to court. At the Law Offices of Judy L. Burger, we will aggressively pursue the best outcome possible for you in your divorce or custody proceedings.  Depending on the status of your case, time may be of the essence, so don’t delay. Judy L. Burger is known for her tenacious representation of clients in high conflict cases in and around the San Francisco Bay and Sacramento areas.  If you are a parent facing a divorce or custody dispute, call us today to learn more about how we can help.  Call (415)293-8314 in the San Francisco Bay area or (916)631-1935 in the Sacramento area, or contact us online via our confidential inquiry form.
California Divorce

How Will a Pension Be Divided in a California Divorce?

Splitting a pension
Splitting a pension
An issue most people worry about when facing a divorce, after child custody issues, is how property will be divided.  California is a community property state, which generally means any property acquired during a valid marriage by a husband or wife is considered joint property. Sections 760 and 771 of the California Family Code outline the state law pertaining to community property. During a divorce proceeding, a judge will equitably divide community property based on possession, the earnings of both parties and the length of the couple’s marriage. (Remember equitable does not necessarily mean equal.)  Unless there is a valid prenuptial agreement, California community property will apply if the couple divorces here. A pension is often the most valuable asset in the marriage, and you should consult to a qualified California family law attorney before agreeing to any terms of a property division.  Procedures for dividing a pension can vary greatly depending on the type of pension. Certain types require the pension be joined and named as a party to the divorce before a judge can rule on how it will be divided. Once the court decides how a pension will be divided, if at all, the court must issue a qualified domestic relations order (QDRO).  Courts often look to the parties’ attorneys to provide a proposed QDRO, which should be preapproved by the benefits provider to eliminate multiple submissions to the court. It should be noted, that if you are in a same-sex marriage or domestic partnership, your union is not yet recognized by federal law. Since pension plans are governed primarily by federal law, there may be special rules that apply to your case. If you are involved in a case that involves the splitting of a pension plan, the Law Offices of Judy L. Burger will aggressively pursue the best outcome possible for you in your divorce proceedings, including a fair distribution of retirement assets and pension plans. Judy L. Burger is known for her aggressive representation of clients in high conflict cases in and around the San Francisco Bay and Sacramento areas.  If you are facing divorce, call us today to learn more about how we can help.  Call (415)293-8314 in the San Francisco Bay area or (916)631-1935 in the Sacramento area, or contact us online via our confidential inquiry form.