Family Code Section 770 provides that the separate property of each spouse is property acquired before the date of marriage, during the marriage by gift or inheritance, or after the date of separation.
In most dissolution actions, the above definition is used to determine which property is awarded to each spouse as their sole and separate property. For example, if one spouse acquired a house prior to marriage, that property would remain the spouse’s separate property after marriage. Also, if one spouse inherited property during marriage, it would be awarded to that spouse in a subsequent dissolution. There may be a community property interest created during marriage for community funds used to pay down the mortgage or for improvements on separate property. However, that issue will be discussed more fully in other blogs.
A unique issue arises when couples purchase a house jointly prior to marriage. After the couple marries, the house remains separate property. Each spouse’s separate interest may be different depending on contributions to the property and how title was taken, either joint tenancy or tenancy in common. Prior to 1985, the family law court had no jurisdiction to determine each spouse’s separate interest in jointly held property acquired prior to marriage. The separate interest of each spouse had to be determined in a separate civil actions. The enactment of Family Code section 2650 in 1985 gave the Family Law court jurisdiction to divide premarital jointly held property.
FC 2650 provides: “In a proceeding for division of the community estate, the court has jurisdiction, at the request of either party, to divide the separate property interests of the parties in real and personal property, wherever situated and whenever acquired, held by the parties as joint tenants or tenants in common. The property shall be divided together with, and in accordance with the same procedure for and limitations on, division of community estate.” Because FC 2650 requires the Court to divide such property with the same procedure for division of the community estate, reimbursement for separate property contributions must be applied under Family Code section 2640. Under FC 2640 reimbursements are limited to pay down on the principal loan balance and improvements. Property taxes, mortgage interest and insurance are not reimbursed. This procedure differs from the equitable partition rules for dividing jointly owned separate property in a civil action in which a party can seek a credit for separate property payments of taxes, mortgage interest, insurance and repairs.
While the Court’s jurisdiction over community property is automatic, the same is not true regarding FC 2650 jurisdiction over jointly owned separate property. Such jurisdiction is only conferred at the request of one party. As discussed above, the result could be substantially different if the property is divided in a separate civil partition action rather than under FC 2650. Therefore, this determination should be made prior to filing for dissolution of the marriage. If the equitable partition rules that apply in a civil partition action would be more appropriate, such as oral agreements as to the respective interests, then filing a civil partition action prior to the dissolution matter should be considered. If the clearly defined rules for dividing jointly held premarital separate property under FC 2650 would be better under the facts of a particular case, then the party filing for dissolution should request 2650 jurisdiction in the Petition or soon thereafter.
If you want to hear more about the latest information about dividing separate property in divorce please contact our office. The Law Office of Bawden and Kochis handles cases with family law issues regarding adoption, annulment, mediation, domestic violence, pensions, child custody, child and spousal support as well as pre-marital and post-marital agreements. Telephone (909)792-0222, or email us at [email protected]