Child Support can be Paid by Transferring Property

Parents may agree to provide for child support by transferring real property to obligee parent, with conditions

In a recent unpublished opinion on November 21, 2011, the Court of Appeal ruled that parties may agree to provide for child support through the transfer of real property so long as the court retains jurisdiction to modify child support upon a showing of changed circumstances.

In the Gonsalez case, Husband executed three “quiclaim” deeds (also called Interspousal Transfer Deeds in divorce cases) in favor of Wife of property the parents acquired during their marriage in exchange for Wife’s agreement not to seek child and spousal support.  Thereafter, Husband left California and didn’t pay any child support to Wife for six years. 

In 2006, Wife obtained a default judgment and obtained a divorce from Husband.  The court reserved jurisdiction to award child support.  In 2007, Husband filed a motion seeking a court order setting aside the three quitclaim deeds that he signed.  The court denied his request, citing the finding that Husband knew exactly what he was signing and he understood what he was signing.  Husband also intended to transfer his interest to Wife and did so specifically in consideration of the agreement that Wife would not seek support from Husband.

The Court explained that it is not unheard of that parents would exchange property for future child support payments.  Parents are permitted to make agreements for child support.  (Family Code 3580).  Since the trial court retained jurisdiction to award child support in the future if there were any changed circumstances, the default judgment was proper.  Additionally, Wife had not sought any support from Husband so it was not an illusory agreement.  Further, the court lost the jurisdiction to retroactively modify child support to an earlier date because child support had been set (to zero).  (Family Code 3651).

Child support agreements can be crafted in a variety of creative ways.  Notwithstanding an agreement outside of court, the trial court in every case must order the “guideline” amount of child support.  Our attorneys have extensive experience in negotiating and drafting child support agreements.  We are ready and available to speak with you today regarding your child support matter.  Feel free to call or email us today.

Your Community Property may be Liable for your Spouse’s Separate Debt

Irvine Divorce Lawyers and Premarital Agreement Experts

Our office is easily accessible to all areas of Orange County, including Costa Mesa, Irvine, and Newport Beach

Did you know that your community property may be liable for the debts of your spouse, even if that debt was incurred before marriage?

Imagine a situation where Husband brings student loan debt into his marriage with Wife.  During the marriage, Wife is under the impression that Husband had paid off the student loans because he wasn’t paying on the loans any longer.  However, rather than pay off his student loans, Husband had just stopped paying and the student loan debt went into default.  Let’s also assume that Wife is the only one working during the marriage, and the Husband stays home during the day to play video games and golf.  (You can imagine this scenario using any kind of debt, including small business debt, car loan debt, promissory note debt, credit card debt, and so on.) 

Soon after Husband stops paying on his student loans, collection agencies begin calling.  Wife is shocked to learn that Husband simply stopped paying on his student loans.  Now, she is wondering whether she is responsible to repay her Husband’s student loans from the joint, community property that she owns with Husband.  Since she has been the one primarily funding the parties’ joint accounts through her employment, she doesn’t think it would be fair that she, through the community, should be responsible for Husband’s premarital, separate property obligations.

The question is whether Wife, and the community, may be subject to liability for Husband’s separate debts:  And the short answer is yes.  The rule that the community is responsible for one spouse’s separate debt applies regardless of which spouse has management and control of the property or whether one or both spouses are parties to the debt or to a judgment for the debt. (Family Code § 910(a) & (b); Lezine v. Security Pac. Fin’l Services, Inc. (1996) 14 C4th 56, 64, 58 CR2d 76, 80).  Community estate liability under § 910 is not limited to debts incurred for the benefit of the community, and the community’s liability may even extend to debts incurred by one spouse exclusively for his or her personal benefit (although the “innocent” spouse may have a reimbursement claim).  (See Levine).  Even assets like pension plans are available to a judgment creditor to levy, including the IRS, for a spouse’s separate property debts.  (See In re McIntyre (9th Cir. 2000) 222 F3d 655, 658 (applying Calif. law); see also Ordlock v. Commr. (9th Cir. 2008) 533 F3d 1136, 1138–1139—because the community is liable under Family Code 910 for Husband’s income tax debts incurred during marriage, Wife not entitled to refund of community property payments made even though she claimed “innocent spouse” status).  The community has even been held responsible to pay restitution for Husband’s wrongful acts in a criminal case!

So how do you protect yourself from your spouse’s separate debts?  First, it may be wife to hire an attorney before you get married to draft and execute a premarital agreement.  You can create a document that outlines your spouse’s liability for his separate debt and also states that the community is not liable.  If all the appropriate precautions are taken and the agreement is executed properly, and then recorded, you may limit your liability.  Second, you can hire an attorney to create a post-marital agreement.  Third, you can file for divorce or legal separation. 

Feel free to contact our office today by telephone or email to set up your free consultation with one of our outstanding attorneys.  We will be happy to explain your options to you in a language that is simple and will make sense to you.

Residency Requirements for Divorce (Including New Rules for Same Sex Partners)

Irvine Divorce Attorneys and Family Law Specialists

The law has recently changed with respect to residency requirements for same-sex marital partners to divorce in the State of California.  Below is an outline of the residency requirements as they exist, generally, along with comments regarding the new changes effective January 1, 2012.

Residency Requirements Generally. In order to obtain a divorce in California, one spouse must be a resident of the State of California for six months and of the county where the proceeding is filed for three months preceding the filing of the petition.  Either party may file for dissolution (divorce) as long as one party satisfies the requirements.  It is important to note that if the residency requirements are not satisfied and neither party contests residency, any defect in the requirement is waived.

The six-months/three-months residence prerequisite applies only to marriage dissolutions.  There is no residence requirement for filing for legal separation.  Therefore, if neither spouse satisfies the residency requirement but wish to obtain a divorce in California, and will later meet the requirements, a spouse can file for legal separation and later amend the petition.  This tactic could be used if one party intends to fulfill the six-months/three-months prerequisite eventually but would like to start the dissolution process immediately.  Once the requirement is satisfied, the spouse may amend the petition or the response to request dissolution instead of legal separation.

Domestic Partnerships. There is no minimum residence prerequisite to dissolve a domestic partnership that was established in California.  Domestic partners who register their partnership with the California Secretary of State thereby consent to California jurisdiction to end the partnership as well.   However, the residency requirements still apply in California if the domestic partnership was established outside of California.

Same Sex Marriages. For a brief period in 2008, California granted marriage licenses to same-sex couples.  Since November of 2008, California has banned such licenses. A problem arose when these married same-sex couples moved out of California to states that did not recognize their marriage and therefore would not grant them a divorce.   The couple no longer satisfied the California residency requirements and could not obtain a divorce in the state where they currently resided.

In 2011, the Domestic Partnership Equality Act was passed.  The Act authorizes a judgment for dissolution or legal separation of a marriage between persons of the same sex to be entered if the marriage was entered in California and neither party resides in a state that will dissolve the marriage.  On January 1, 2012, this exception to the California residency requirements became effective.

When contemplating a divorce or legal separation, it is imperative to consider where to file the petition. Dissolution cases involve difficult and life changing decisions. Because of the complexity of this issue, it is best to hire an attorney who is experienced in such matters. The attorneys at Wilkinson and Finkbeiner, LLP are Certified Family Law Specialists and have successfully handled a variety of dissolution cases and can assist you with your matter. Feel free to call today at (714) 667-0045 for your free initial consult. You can also send us an email inquiry.

Disappearing Assets?

Do you suspect your former spouse is mis-managing your community assets such as stocks, 401(k), bank accounts, and other investments? If so, they likely have the burden to account for any missing or mis-managed assets and could be held liable for such losses.

In a recently published case, In Re. Marriage of Margulis (2011) (CA Opinion filed August 11, 2011), the court discussed the broad fiduciary duties spouses and even former spouses owe each other when managing community assets after separation.

In this case, the parties separated after 33 years of marriage. The Husband had always been the breadwinner of the family and was in charge of the couple’s finances. After the parties separated, Wife trusted Husband to remain in control of the parties’ investment accounts and bills. However, years later in the couple’s dissolution proceedings, Wife discovered all of the parties’ community property investment accounts were nearly depleted due to the actions of Husband.

Under the applicable Family Code, spouses owe each other certain “fiduciary duties”. This confidential relationship imposes a duty of the highest good faith and fair dealing on each spouse, and neither shall take any unfair advantage of the other (Family Code § 721).  Such a fiduciary duty encompasses the duties of accounting, informing and disclosing of all financial information. The duty to account for the disposition of community property exists from separation to final distribution of assets (Family Code § 1100). The court here found that Husband had breached his fiduciary duties he owed to his Wife by failing to render accountings of the community property and inform Wife of the drastic changes to the parties’ accounts.

The court held “once a non-managing spouse makes a prima facie showing of the existence and value of community assets in the other spouse‘s control post separation, the burden of proof shifts to the managing spouse to prove the proper disposition or lesser value of those assets. Failing such proof, the court should charge the managing spouse with the assets according to the prima facie showing.” Thus a complete retrial of the community property issues was ordered. The court accordingly shifted the burden to Husband to prove that he did not improperly mis-manage the community assets.

The division of community property can be a very challenging aspect of dissolution cases. Hiring a competent attorney will ensure that all assets are divided equitably.   Our attorneys are experienced in such issues and can assist you with your matter.  Feel free to call today at (714) 667-0045 for your free initial consult.  You can also send us an email inquiry.

How do I Pick the Best Divorce Lawyer for My Case?

Newport Beach – Huntington Beach Dissolution of Marriage Attorneys

How do family law litigants pick the right divorce attorney for their case?

Many clients interview several divorce lawyers before selecting one to represent them in their divorce, paternity or child custody and visitation case.  This Orange County divorce blog article provides real and practical information for picking the right attorney for your case.

Does this Divorce Lawyer Have Experience?

The first question soon-to-be-divorcees should ask an attorney they interview to possibly represent them in their case is what experience the attorney has in litigating or settling divorce cases.  There are over 220,000 attorneys in California.  Only a very small handful of these attorneys practice family law (divorce law) exclusively.  Your attorney should have significant experience in litigating and settling divorce cases – you need to have someone on your side that has “been there before”, knows what the judge or commissioner wants to see in your pleadings, and has a solid track record for finishing cases in a timely manner at a reasonable cost.  Generally, newer attorneys offer lower hourly rates but do not have much experience.  Seasoned attorneys with decades of experience may have significantly higher hourly rates than most family law divorce lawyers.  The trick is to find a happy medium, where the attorney has significant proven results, years of experience, but also offers reasonable rates. 

To ensure that an attorney has the right experience, ask whether they are a Certified Family Law Specialist (CFLS), which means that the State Bar of California has actually certified that attorney as a family law expert.  There are less than 300 Certified Family Law Specialists throughout all of Orange County and San Diego County, combined.    

Does an Attorney’s Office Location Matter?

Yes.  When you select your attorney, select an attorney whose office is either near your current residence or better yet, near the courthouse where your case will be heard.  Having an attorney that practices in an area near your home will reduce your travel time to visit with your attorney; however, keep in mind that technological advances have made communication with your lawyer very easy and many times an office visit is unnecessary.  Our firm often uses electronic or facsimile transmissions to obtain signatures, review documents, and so forth.  The selection that would benefit your pocketbook is to hire the attorney whose office is near the Lamoreaux Justice Center, where almost all Orange County divorce and custody cases are heard.  This will reduce the lawyer’s travel time to and from court.

Will this Attorney be Available if I Need to Speak to them Immediately?

One of the most frequent complaints we hear from clients who hire our firm after they have fired their previous lawyer is that the lawyer was never available to speak with them, never answered emails, and so on.  As a client paying for legal services, you should be able to speak with or email with your attorney as you see fit.  Keep in mind that the good family law firms have experienced paralegals that handle many of the recurring issues that most clients encounter, which reduces the overall costs of services because paralegal billing rates are less than attorney billing rates.  However, your attorney should be accessible if you need them.

How do I Know Which Divorce Attorneys are the Best?

Selecting the best divorce lawyer for your case is a subjective process.  Select an attorney that you communicate well with, explains your options to you in a language you can understand, is accessible, has a friendly but experienced staff, and has a proven successful track record.  Every case is different, so be careful about comparing your case with one of your friends or relatives.  However, getting referral suggestions from friends and family can be a good idea.  Many times, just visiting a divorce lawyer’s office indicates how successful they are.

Contact our Experienced Santa Ana Divorce Lawyers

Our law firm prides itself on providing cost effective and results-driven representation to all of our clients.  Our partners are Certified Family Law Specialists and our team of associate attorneys and staff are friendly and experienced.  We offer a free initial consultation, so please email or call us today. 

Orange County Office: (714) 667-0045

San Diego Office: (619) 284-4113

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