Getting Your Separate Money Back From Real Property Upon Divorce: Family Code Section 2640

Family Code Section 2640 provides that separate property contributions used to acquire property during marriage is reimbursable to that party upon divorce.  There is no increase for interest or adjustment for change in monetary values.  Further, the equity must be present in the property at the time of the divorce to cover the separate property contribution.

For example, John uses $100,000 that he had earned before marriage (his separate property) as a downpayment for a house that he purchased with his wife Jane.  Several years later, the couple decides to divorce and at that time, the house has equity of $200,000.  John would then receive his $100,000 back as his separate property contribution to the acquisition of real property, pursuant to Family Code section 2640.  There is no increase in John's $100,000 down payment investment for interest or inflation.  Note that John would also receive an additional $50,000 for his one-half community property interest.

However, assume that at the time of divorce the house only has $50,000 in equity.  Then John would only receive $50,000 because his right to reimbursement of his separate property contribution may not exceed the net value of the property at the time is divided.

*This information does not constitute legal advice.  For more information on divorce and reimbursements, contact Senh Law Associates at (925) 408-8546.

Marriages of "Long Duration" for Purposes of Spousal Support

In California, many parties to a divorce erroneously believe that a marriage of 10 years or more leads to spousal support (aka alimony) that may be ordered indefinitely.  This misconceived notion comes from a cursory review of Family Code section 4336 without understanding its nuance.  In fact, the law provides that the court retains jurisdiction indefinitely to order spousal support in a divorce where the marriage is of "long duration."  Family Code section 4336, defines a marriage of "long duration" as follows:

…there is a presumption affecting the burden of producing evidence that a marriage of 10 years or more, from the date of marriage to the date of separation, is a marriage of long duration.  However, the court may consider periods of separation during the marriage in determining whether the marriage is in fact of long duration.  Nothing in this subdivision precludes a court from determining that a marriage of less than 10 years is a marriage of long duration.

Rather than a bright-line rule, a marriage of 10 years or more only effects the burden of proving that the marriage is of “long duration” such that the court can retain jurisdiction indefinitely to order spousal support.  The court has discretion to determine that a marriage of less than 10 years is a marriage of “long duration” for purposes of retaining jurisdiction.

This is a very different issue than whether spousal support will be ordered to be paid indefinitely.  There are numerous mandatory factors that the court must take into consideration when making any order for spousal support.  The duration of spousal support will be for a “period of time, that the court determines is just and reasonable, taking into consideration the circumstances.”  [Family Code section 4330].  There is a mandatory consideration for the supported party to be self-supporting within a reasonable period of time.  [Family Code section 4320(l)].  Generally, this period of time is one-half the length of marriage, unless the marriage is of “long duration.”  Even then, the court has discretion to order it for a greater or lesser period of time, taking into consideration mandatory factors as provided under law and the circumstances of the parties.  [Family Code section 4320].

Ultimately, there are no two cases that are exactly alike.  Therefore, the court should have discretion to order spousal support for a period of time that is reasonable based upon the unique circumstances of the parties.  However, without any bright-line rules, parties to a divorce can be understandably uncertain and weary of how long or short an order for spousal support can continue for.  As such, having a knowledgeable and experienced attorney advocating for you may be necessary when litigating this issue.

Maintaining the Status Quo During Divorce Proceedings

In California, after filing for divorce and while your case is pending, the law provides for a number of ways to ease the separation from your spouse.  These prophylactic measures are meant to ensure that both parties to the divorce receive the benefit of the marital community while litigating their case.  There are number of automatic restraining orders (ATROs) [Family Code Section 2640] that become effective when the summons is issued and served upon your spouse.  They are found on the second page of the divorce summons and prevent each party from:

Removing the minor child or children of the parties, if any, from the state without the prior written consent of the other party or an order of the court;

Cashing, borrowing against, canceling, transferring, disposing of, or changing the beneficiaries of any insurance or other coverage, including life, health, automobile, and disability, held for the benefit of the parties and their minor child or children;

Transferring, encumbering, hypothecating, concealing, or in any way disposing of any property, real or personal, whether community, quasi-community, or separate, without the written consent of the other party or an order of the court, except in the usual course of business or for the necessities of life; and

Creating a nonprobate transfer or modifying a nonprobate transfer in a manner that affects the disposition of property subject to the transfer, without the written consent of the other party or an order of the court. Before revocation of a nonprobate transfer can take effect or a right of survivorship to property can be eliminated, notice of the change must be filed and served on the other party. 

In general, these ATRO's prevent the other party from displacing community property or the parties' children, such that the other party would be placed at a disadvantage during the divorce.  The portions regarding not canceling any insurance for the benefit of the family also serves the same purpose and helps ease the transition from being a married couple to being self-sufficient.  These protections are necessary to ensure that no unfair advantage is gained by either party in the proceeding while they are going through litigation that can potentially last for months or years.

Besides ATRO's, there are other mechanisms of the law that help maintain the status quo, or ease the transition of a divorce.  These include temporary child custody and visitation, temporary spousal support, and pendente lite (or interim) orders for attorney fees.

Taken as a whole, the law has attempted to create fair and equal divisions of the bounty of the marital community during the time that the parties are litigating their divorce.  Sometimes this becomes difficult because resources are stretched thin when a couple decides to divorce.  Ultimately, it can be a rocky road because dividing something in half never equals the sum of its parts.  However, the alternative to these stop-gap, or prophylactic measures, would likely be that one party to a divorce is left holding the short end of the stick.  

*This information is not meant to constitute legal advice.  To learn more about divorce, contact our attorneys at Senh Law Associates, (925) 408-8546.