As their divorce proceeded, Frank and Elizabeth had much to talk about – or rather, negotiate. During their 12-year marriage, they had accumulated property and debts together. However, each had also brought separate property in their marriage. A lot had changed in the past 12 years. Property discussions heated up as disagreements over how to classify their property erupted. Frank, Elizabeth, and their respective lawyers had to figure out when separate property is no longer separate before they could finalize their divorce.
Separate Property vs. Community Property
You’ve probably heard it many times: California is a community property state. But where there is ‘community’ property, there’s usually ‘separate’ property. The trick is knowing which is which.
We should start with the word ‘property’ first. Property can be:
- Something that can be bought or sold, like a car;
- Something that has value, like bank accounts, business interests, and intellectual property.
Community property typically means property that a couple owns together. Almost everything you get when you are married could be considered community property, including debts. Typical exceptions are gifts and inheritances.
Separate property usually is:
- Something you owned before you were married;
- Most gifts and inheritances;
- Money earned from separate property; or
- Property bought with separate property.
However, sometimes the characterization of a property alters over time or is difficult to pin down.
How Property Can Change Over Time
Married couples often share almost everything. Sometimes close relationships lead to confusion about separate property and community property. In fact, some property can even become part separate and part community. When community and separate property mix, this is called ‘commingling.’
For example, Larry inherited a house before his marriage to Sally, making it his separate property. During their marriage, Larry and Sally renovated the house and maintained it using community funds. Some of the value of the house may now be community property. At some point, Larry and Sally sell the house and buy a new home. If the couple divorce, their respective ownership interests in the new home may be hotly contested. Larry may feel he owns more of the second home because the proceeds from the sale of their first home were his separate property. Sally may contend that community funds were used to maintain and improve the home, making both homes community property.
Property division is often complicated. Commingling adds new layers of complexity. To make sure you receive everything you deserve, make sure you hire an experienced divorce lawyer.
Learn How to Handle Separate Property That’s No Longer Separate
Property division can be highly contentious in a divorce. Clearly, each person wants to keep what they brought into the marriage, but that is not always right or what the law allows.
The attorneys at the Law Offices of Judy L. Burger are experienced at all phases of divorce, legal separation, and annulment. Call us at 415-293-8314 to schedule a private appointment or visit our website. We maintain offices in San Francisco, San Diego, Beverly Hills, Marin County, Santa Barbara, Ventura/Oxnard, San Jose, Gold River (Sacramento), and surrounding communities.