If you are planning to file for divorce in California, the division of property is probably going to be one of the more contentious components of the divorce proceedings. Why? Because many people who decide to file for divorce are shocked to learn that their separate property is actually not entirely immune from division during the divorce process. This is where retaining an experienced and knowledgeable California divorce lawyer can pay dividends and help with protecting your separate property in California.
Understanding Separate Property Law
California adheres to strict community property laws during divorce proceedings. Basically, this means that all of a divorcing couple’s shared assets and debts will need to be divided evenly before the divorce can be finalized. However, it is important to understand that California is a “dual property” state. This means California courts are authorized to consider both separate property and marital property during a divorce proceeding.
What Constitutes a Separate Property
Under California law, “separate property” is effectively anything belonging exclusively to one spouse. In contrast, “community property” is everything subject to division between the divorcing spouses. Under California law, types of separate property typically include:
- Real property owned prior to the marriage.
- Family heirlooms passed down to you.
- Gifts received during your marriage, including gifts given by your soon-to-be-ex-spouse.
- An inheritance you received from a parent, grandparent, or other relative.
- Assets and accounts acquired prior to the marriage.
How to Qualify for Reimbursement
Reimbursement, in the context of a divorce proceeding, is based on Family Code Section 2640. This code provision addresses financial contributions made by a spouse for the acquisition or material enhancement of property during the course of a marriage. Basically, Family Code Section 2640 focuses on situations where one spouse uses their own funds to purchase or improve community property and provides a legal mechanism for that spouse to pursue reimbursement related to the use of those funds.
To be eligible for reimbursement pursuant to Section 2640, the following prerequisites must be met:
- There needs to be clear and convincing evidence indicating the funds used for the purchase or improvement of community property were actually separate property.
- The spouse that made the contribution needs to have intended for the funds to be used for the specific purpose of purchasing or improving community property.
- The amount being pursued for reimbursement is confined to the dollar amount of the separate property contribution.
Reimbursement Types
There are two situations where reimbursement may be possible:
- In the situation where one spouse used their separate property funds to purchase a community property asset (e.g., a home or other property), then that spouse may have the right to seek reimbursement for the amount they contributed via their separate property.
- In the event separate property funds are utilized to improve a community property asset (e.g., paying to renovate your home or other property), then that spouse may seek reimbursement for the increased value of the property due to their financial contributions.
Separate Property Mediation
There’s a hard truth many divorcing couples realize – the divorce process in California is extremely difficult. It is oftentimes quite stressful, emotionally challenging, and frustrating. This is why, in certain instances, it may make sense to attempt mediation rather than going through the standard divorce process. Mediation has the potential to reduce conflict and help the divorcing couple reach an amicable settlement of the issues, including the division of property, that arise during the dissolution of their marriage.
Work With Castro Law Offices
If you have questions about strategies to protect your separate property in California, contact Castro Law Offices today. Jeremy Castro is an experienced and knowledgeable Marin County divorce attorney with a track record of helping people protect their hard-earned assets during California divorce proceedings. Contact the Castro Law Offices to schedule a confidential case evaluation.