The law relating to community property and the division of property in a divorce is fairly complex. When characterizing property as either community or separate, the title of the property is often taken into consideration. Many divorcing spouses assume that whoever is on the title for a piece of property has the legal ownership of that property. This is often not true.
Here are some important “presumptions” in the law relating to the title of property. A presumption doesn’t mean it is the final word. Rather it is more like an assumption in the law that will prevail unless it is overcome. In court in can mean that the spouse challenging the presumption has the burden of proof.
- Property acquired during marriage by either spouse other than by gift or inheritance is community property unless it is traceable to a separate property source or there was a clear understanding between the spouses as regards non-community ownership.
- There is a common law presumption that ownership of property is as is recorded in the title to the property. However, the presumption of marital community ownership in 1. above supersedes this common law title presumption. So, for example, even though one spouse may be on the title to a house or vehicle acquired during marriage, the law presumes it is community property belonging to both spouses.
- If there is a transfer of property during marriage that advantages one spouse over the other, there is a presumption that the transfer was induced by undue influence and therefore should not prevail. An example is when a spouse signs a document to remove himself/herself from the title of a house leaving the other spouse as the only one remaining on the title. This undue influence presumption also carries more weight in a divorce than the common law title presumption in 2. above.
- When title to separate property is changed during marriage to a joint form (joint tenants, tenants in common or community property) the property is presumed to become community property.
- If spouses have a joint bank account, their net contribution to the account is presumed to be community property. This applies to checking accounts, savings accounts, certificates of deposit (CDs) and other similar accounts. So if a spouse puts their separate money into a joint account it is now presumed to be joint money.
Of course when you come to an agreement on your own or with the assistance of a divorce mediator, you are free to characterize and divide property as you wish. But when there is a lot at stake or either of you would be more comfortable having a very clear understanding of the law, this is one of the main areas in which consulting with a family law specialist can be a wise move.
The information above comes in large part from California Judges Benchguide 202 – Property Characterization and Division.