There is a legal concept in California Family Law called a “date of separation.” You need to specify one when you file for divorce or legal separation. You can amend this when filing your divorce settlement agreement with the court.
California Family Code Section 70 defines the “date of separation” as the date that a complete and final break in the marital relationship has occurred, as evidenced by:
- one spouse expressing to the other the intent to end the marriage and
- that spouse’s conduct thereafter being consistent with the intent to end the marriage.
Note that it doesn’t have to be the date you physically separate. When you work out your own settlement, you can agree together on a date.
Significance of the Date of Separation
The date of separation is important when the terms of your divorce are decided by a judge. When you work out your own settlement, perhaps with the assistance of a divorce mediator, you decide how much (if any) importance to attach to it.
It can become important when there were major financial transactions around the time of separation. This is especially true when the two of you don’t agree on the date of separation and this disagreement has significant financial ramifications.
In the law, the date of separation is relevant in the following divorce-related areas:
- spousal support;
- when your income starts becoming your own separate property;
- division of assets and debts;
- allocating living expenses until the divorce is final.
Spousal Support
The date of separation establishes the endpoint used in determining the legal length of your marriage. The length of the marriage is one of the 14 factors judges are required to take into account in establishing post-divorce spousal support.
The legal length of the marriage determines whether the marriage is considered to be one of long duration or short duration. This often affects the duration of spousal support.
Note that the earliest date from which you can begin receiving court-ordered spousal support is the date of filing of the divorce petition. It’s not the date of separation.
Note also that Social Security determines the length of a marriage differently. It uses the date of marriage until the date of divorce.
Income
Earnings that occur between the date of marriage and the date of separation are community (marital) earnings. This is true even if the compensation for the earnings is not received until after the date of separation. An example would a bonus earned before the separation date but not received until afterwards.
Family Code 771 says that earnings that occur after the date of separation are viewed as the separate property of the earner.
Dividing Assets and Debts
The Family Code says generally that debt a spouse acquires after the date of separation belongs to that spouse. Assets acquired also belong to that spouse, unless they were acquired using community funds.
The property and debts that arose during the marriage until the date of separation are referred to as community property.
The assets and debts in a divorce can be community-owned, separately-owned, and/or mixed-ownership (part community and part separate).
It’s a common divorce misconception that assets should be valued as of the date of separation.
The law distinguishes between passive assets and actively managed assets. Passive assets (such as houses, cars and retirement accounts) should be valued currently. This is because neither spouse is causing them to go up or down in value. Therefore, the community should share in what the value is currently.
However, actively managed assets (such as a plumbing business) are being managed by a spouse. The actions of that spouse will directly affect the value of the asset. It’s appropriate to minimize the possibility that the spouse will manipulate the value of the asset. Therefore, it should be valued (according to the Family Code) as of the date of separation.
When you are working out your own settlement out of court, the two of you decide what valuation date you want to use for each asset and debt.
Living Expenses
As noted above, income earned after the date of separation is the separate property of the earner.
It’s not so clear with expenses. In part, this is because each spouse continues to have a fiduciary duty to the other. This duty extends until all the assets have been actually distributed or divided.
The fiduciary duty includes a legal duty to act in good faith, to ensure fair dealing and to avoid taking unfair advantage of the other.
In addition, the Family Code provides for a number of different types of reimbursements.
It’s wise while going through a divorce to have clear agreements as to how the two of you will financially consider and handle the period from the date of separation until the divorce is final.
