First of all, I should note that Google Answers provides general
information and is not a substitute for professional legal advice. The
information presented below may or may not apply to your particular
circumstances. If you need professional legal advice, you should
contact a qualified attorney in your area.
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"Separate property" is defined in Section 770 of the Family Code:
"770. (a) Separate property of a married person includes all of the
following:
(1) All property owned by the person before marriage.
(2) All property acquired by the person after marriage by gift,
bequest, devise, or descent.
(3) The rents, issues, and profits of the property described in
this section.
(b) A married person may, without the consent of the person's
spouse, convey the person's separate property."
http://www.leginfo.ca.gov/cgi-bin/displaycode?section=fam&group=00001-01000&file=770-772
As such, under Section 770(a)(1), any property that you owned before
your current marriage would be "separate."
However, things could get complicated if you have a mortgage on your
separate property and you've been making mortgage payments using
community property funds (e.g., your wages or your wife's wages). An
article by a California lawyer mentions this issue:
"REAL PROPERTY
A house or other real property owned before marriage remains the
owner's separate property after marriage, even though the parties live
in it. However, it is difficult to remove a spouse or even a live-in
companion from a residence, even though that person has no ownership
interest.
If a prior existing mortgage debt is paid from community property,
the community will develop a small but growing fractional interest in
the property. The principal paydown is the numerator: the total equity
in the property is the denominator. This fraction is multiplied by the
total value of the property. The end result is the community interest
in the property.
The problem of lender's intent arises when separate property is
refinanced during marriage. If the lender relies for repayment on the
borrower's income stream or on his general credit, the proceeds of the
loan will be community property. If the loan is a pure purchase money
loan, the property will remain separate. Payments on a loan should be
made from separate property is the separate property character of the
property is to be maintained."
source:
Keeping Separate Property Separate Without a Prenuptial Agreement
by Stuart B. Walzer
http://www.california-divorce.com/premarital/separate.html
Also, see:
"...if you own property prior to getting married it remains your
separate property even after you break up. However, there are some
exceptions to this rule. For instance, if you commingle your assets
you can make an asset community property. Also, if you make a down
payment on a piece of real estate with separate property funds prior
to the marriage, but throughout your marriage you make mortgage
payments from your community wages, your spouse will have a community
interest in that property known as a Moore-Marsden interest, which is
calculated with a formula based upon the amount of loan principal paid
from community funds. However, you will get your separate property
down payment back."
source: Divorce Attorney Georgine Brave San Diego California
http://www.bravefamlaw.com/faq-realestate.htm
More Google results on the "Moore-Marsden interest":
://www.google.com/search?hl=en&lr=&client=googlet&q=%22Moore-Marsden+interest&btnG=Search
More Google results on the "Moore-Marsden" in general:
://www.google.com/search?hl=en&lr=&client=googlet&q=%22moore+marsden%22&btnG=Search
Of course, such a "Moore-Marsden interest" would not have been created
if you had a premarital agreement that circumvented it OR you had made
the mortgage payments using only separate property funds.
I realize that this answer might not necessarily be what you wanted to
hear, but I'm sure that you wanted to be fully aware of the
Moore-Marsden exception, as it might be employed by your wife and/or
her attorney. I hope this helps.
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search strategy:
find california code
"moore marsden"
I hope this helps. |
Request for Answer Clarification by
svi-ga
on
13 Jan 2006 21:24 PST
Thank you for the information.
But the question is: is this my seperate property or community property?
I opened escrow with my own money before marriage. However, I got
married and then closed escrow. All monies to close escrow were my
monies- not community.
So again is this considered my seperate property?
I never re-financed during our 3 yeasr marriage and paid interest only payments.
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Request for Answer Clarification by
svi-ga
on
13 Jan 2006 21:24 PST
In addition, she has never worked during the marriage. I supported her.
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Clarification of Answer by
juggler-ga
on
13 Jan 2006 23:12 PST
Hi,
I'm sorry that you found the answer unclear.
As indicated house may be TITLED as your separate property, and the
original down payment may have been (and may continue to be) your
separate property, but if you used your wages to make the mortgage
payments, then your wife may have gained a PARTIAL community property
interest in the equity in the home. This is called the Moore-Marsden
rule.
Again, the second article above makes the point very clearly:
"....Also, if you make a down payment on a piece of real estate with
separate property funds prior to the marriage, but throughout your
marriage you make mortgage payments from your community wages, your
spouse will have a community interest in that property known as a
Moore-Marsden interest, which is calculated with a formula based upon
the amount of loan principal paid from community funds. However, you
will get your separate property down payment back."
source: Divorce Attorney Georgine Brave San Diego California
http://www.bravefamlaw.com/faq-realestate.htm
Is there anything in that you find unclear? If so, what?
Finally, it doesn't matter at all that your wife never worked. Your
wages were community property. She owns half of everything you make
from your job.
Again, I understand that you may have preferred an answer along the
lines of, "No sweat! It's all your separate property."
However, my obligation here is to provide you with an accurate answer.
As such, I had to alert you to your wife's potential claim of a
partial community property interest in the home under the
Moore-Marsden rule.
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Clarification of Answer by
juggler-ga
on
13 Jan 2006 23:22 PST
Here's a piece that discusses how the Moore-Marsden formula is applied:
http://66.102.7.104/search?q=cache:Xz7MwZWs0Z0J:www.jprlawcorp.com/cgibin/divorce/messages/4608.html+%22moore+marsden%22+%22principal+payments&hl=en
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Clarification of Answer by
juggler-ga
on
13 Jan 2006 23:41 PST
I notice that you mention that you've been making interest-only payments.
That may work in your favor, as the Moore-Marsden formula looks at the
extent that principal was reduced by community property payments.
"This formulation has the virtue of simplicity but has been criticized
because it does not consider interest payments as a part of
acquisition, and because it apportions appreciation equally among all
principal payments, regardless of when the payments were made.
Criticisms to the contrary notwithstanding, the formula persists."
http://66.102.7.104/search?q=cache:Xz7MwZWs0Z0J:www.jprlawcorp.com/cgibin/divorce/messages/4608.html+%22moore+marsden%22+%22+interest+payments&hl=en
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Request for Answer Clarification by
svi-ga
on
14 Jan 2006 07:27 PST
Thank you for the response but I do understand the Moore-Marsden rule;
however this rule only applies with the property is considered
seperate. Then she will have a small interest since it , in essence,
the product of (what has been paid down/what is owed) * (how much the
property gained value) over the marriage.
She is making a claim that the house is community since the the escrow
closed after marriage. Then her interest is 50% a difference. This a
difference of 10's of thousands vs. 100's of thousands.
Is the house considered seperate property or community property, if
the home was purchased (opened escrow) before marriage but closed
(escrow) after marriage? Recall no community funds were used to close
escrow.
Once this is determined, then her interest can be determined.
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Clarification of Answer by
juggler-ga
on
14 Jan 2006 09:40 PST
Hi,
If the property was granted to you as your separate property and your
separate property funds constituted 100% of the down payment (as it
appears to from the information given), it doesn't matter that escrow
closed after the marriage.
"In re Marriage of Mix (1975) 14 Cal. 3d 604 , 610 [ 122 Cal. Rptr. 79
, 536 P.2d 479]. ) Property purchased with separate property funds is
likewise the separate property of the acquiring spouse. (In re
Marriage of Mix, supra, at p. 610.) Such separate property does not
change its character as a result of the marriage or of its mere use in
the marital relationship. (Patterson v. Patterson (1966) 242 Cal. App.
2d 333 , 340 [ 51 Cal. Rptr. 339]. )"
http://www.cflr.com/courses/study/fulltext/aufmuth.htm
" As the court in Patterson stated: "If the property, or the source of
funds with which it is acquired, can be traced, its separate property
character remains unchanged. [Citations.] But if separate and
community property or funds are commingled in such a manner that it is
impossible to trace the source of the property or funds, the whole
will be treated as community property . . . ." (Patterson v.
Patterson, supra, at p. 341.)"
http://www.cflr.com/courses/study/fulltext/mix.htm
"As the court in Patterson [Patterson v. Patterson (1966) 242
Cal.App.2d 333, 341 (51 Cal.Rptr. 339)] stated: 'If the property, or
the source of funds with which it is acquired, can be traced, its
separate property character remains unchanged. [Citations.] But if
separate and community {Page 130 Cal.App.3d. 442} property or funds
are commingled in such a manner that it is impossible to trace the
source of the property or funds, the whole will be treated as
community property ....'" (In re Marriage of Mix (1975) 14 Cal.3d 604,
611 [122 Cal.Rptr. 79, 536 P.2d 479].)
[7] The presumption that all property acquired by either spouse
during the marriage is community property may be overcome. (Id, at p.
611.) "Generally speaking there are two methods of carrying the burden
of showing property purchased during the marriage to be separate: (1)
direct tracing to a separate property source or (2) proof that at the
time of purchase all community income was exhausted by family
expenses." (Estate of Murphy (1976) 15 Cal.3d 907, 918 [126 Cal.Rptr.
820, 544 P.2d 956].) "
http://online.ceb.com/calcases/CA3/130CA3d426.htm
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Request for Answer Clarification by
svi-ga
on
14 Jan 2006 13:41 PST
Thank You.
This was what I was looking for. Any other CA Case Law would be
appreciated to support my claims. I clearly used my sepaerate $$ and
opened escrow prior.
She is arguing TITLE should have been changed from A Single Man to
Married when i closed escrow. I was simply following escrow
instructions and knew nothing of the sort. I believe her argument to
be moot.
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Clarification of Answer by
juggler-ga
on
14 Jan 2006 14:39 PST
Right. Even if the title company had identified you as "married" on
the grant deed, it wouldn't change the fact that your down payment
could be traced entirely to separate property funds, and, thus would
continue as separate property under the cases identified in my
preceding post (i.e., Mix, Patterson, Murphy, etc).
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Request for Answer Clarification by
svi-ga
on
16 Sep 2006 17:36 PDT
Turns out I am hearing above cited cases such as Mix and Paterson have
been over-ruled by Civil Code Section 4800.1 and 4800.2 effective
January 1983 - do I need to worry about these codes? Again I opened
escrow before marriage, closed escrow after marriage. Title is in my
name as a Single Man and I used 100% my seperate funds to close
escrow. Is the property still considered my Seperate Property and
Moore/Marsden then applies?
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Clarification of Answer by
juggler-ga
on
16 Sep 2006 23:41 PDT
Hey, it's been a while! I don't think I've ever received a
clarification request 8 months later, but I suppose that there's a
first time for everything.
The California Civil Code does not appear to contain either a Section
4800.1 or a Section 4800.2.
http://www.leginfo.ca.gov/cgi-bin/calawquery?codesection=civ&codebody=&hits=20
Are you sure about that code citation?
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Request for Answer Clarification by
svi-ga
on
17 Sep 2006 16:58 PDT
Yes, it has been a while but seemingly still a bit confused. Thanks
for the speedy response! I believe I meant Familiy Code 2640. Argument
is as follows: I entered a purchase agreement to "purchase" property
before marriage and even though the Deed was signed off to me as a
Single Man before marriage, escrow did not close to after marriage
when then I "acquired" the property and the Deed was then recorded as
in the Marriage of Miller, 1982, so therefore it is automatically
community property independent of how tilte is held and independent to
the fact I used my serpate monies per Family Code 264).
Is this true? So difficult to believe. In my mind I purchased the home
before marriage, it is my seperate property not community. Thus the
Moore/Marsden calculations apply.
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Clarification of Answer by
juggler-ga
on
17 Sep 2006 21:04 PDT
Do you have a link to (or a more complete citation for) Marriage of Miller?
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Request for Answer Clarification by
svi-ga
on
17 Sep 2006 21:43 PDT
Not sure if this will work but this is what I could find, hope this helps:
http://login.findlaw.com/scripts/callaw?dest=ca/calapp3d/133/988.html
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Clarification of Answer by
juggler-ga
on
17 Sep 2006 23:12 PDT
In re the Marriage of Miller [133 Cal.App.3d 989] differs from your
case in a key way (i.e., "Wilbur and Jacqueline took title as joint
tenants").
Quoting from the end of the opinion:
"...The act of taking title in a joint and equal ownership form is
inconsistent with an intention to preserve a separate property
interest. Accordingly, the expectations of parties who take title
jointly are best protected by presuming that the specified ownership
interest is intended in the absence of an agreement or understanding
to the contrary." (In re Marriage of Lucas, supra, 27 Cal.3d 808,
815.)
The premarital contractor can preserve his separate property interest
by taking title before marriage, by taking title in his name alone, or
by securing his spouse's agreement that he is to retain an interest
commensurate [133 Cal.App.3d 993] with his separate property
contribution. Here Wilbur did none of these things. Jacqueline is
entitled to the protection of Civil Code section 5110"
As indicated by the court's opinion, "taking title in his name alone"
is a way of making clear the intention to treat property as separate.
I hope this helps. Please kind in mind that, at this point, I'm not
receiving any payment for my comments here and the opportunity to add
a tip has long since lapsed. As such, if you require additional
assistance, you might want to consider launching a new question:
https://answers.google.com/answers/askquestion
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Clarification of Answer by
juggler-ga
on
17 Sep 2006 23:31 PDT
That should have read: "Please keep in mind that..."
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Request for Answer Clarification by
svi-ga
on
24 Sep 2006 22:11 PDT
Thank You. Yes we are right. I will re-post. This is a very
interesting case and could use help finding recent Case Law.
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Request for Answer Clarification by
svi-ga
on
24 Sep 2006 22:13 PDT
Correction - I meant to say "you are right" regarding re-posting ...
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