How Is Communal Property Divided?
When going through a divorce, several things need to be determined, such as child custody, spousal support, and the division of property. Disentangling your life from another person’s can be difficult for several reasons. When you live together for several years, there is a lot that is shared between both partners. For instance, figuring out how to navigate relationships with mutual friends can be an extremely complicated undertaking. While this is something that you’ll have to settle amongst yourselves, matters involving communal property are settled by the courts. But what types of property are considered communal, and how does the judge decide how it should all be divided?
What Is Communal Property?
During discussions regarding property division resulting from a divorce, you’ll likely hear two distinct terms utilized: separate property and communal property. Separate property refers to anything you acquired outside your marriage. This includes assets you owned before you married and gifts or inherited assets intended solely for you, even if they were received while you were married. On the other hand, communal property is everything acquired within your marriage. Even with this distinction in mind, it can still be confusing to understand what is considered property.
The word property generally refers to anything that can be bought or sold or has some value. Examples of property include more material goods like vehicles, art collections, jewelry, forms of real estate such as houses or acreages, and more immaterial things like bank accounts, retirement plans, businesses, and even debt.
One additional type of property could potentially apply depending on your situation, and that is quasi-communal property. This designation is for communal property acquired during your marriage but while you were residing in another state. Despite being purchased out of state, this type of property is grouped alongside the rest of your California communal property when going through a divorce.
Does a Judge Have to Divide Communal Property?
If you and your spouse have an amicable relationship, you might be wondering whether it’s essential to have the courts determine how everything should be divided. In California, family law states that spouses can settle the division of property amongst themselves so long as both parties agree to the arrangement. This can be done by simply divvying up the various assets or exchanging certain assets for money. Once you have agreed regarding all aspects of your shared property, you can present this to a judge for final approval.
If you choose to pursue this route, you must work alongside an experienced attorney who can ensure you’ve properly accounted for all your assets and filled out the relevant paperwork correctly. Your lawyer can also help you set aside anything that should be considered separate property to prevent you from accidentally giving up more than you should. With your attorney’s assistance, you can ensure that the division of property is conducted fairly and that you don’t end up making a costly mistake.
Having the Courts Divide Your Property
If you cannot agree, then the courts will determine how your shared property should be divided. Some states are referred to as equitable distribution states because they consider several extenuating circumstances and contexts, such as spousal income and individual contribution to the marriage, in an attempt to divide the property in a just manner. California is considered a community property state. This means that instead of taking into account those additional factors, all shared assets will be divided equally between both parties, as both are considered to have equal rights to all earned wages, assets, and debts gathered over the years.
Some assets are, of course, more easily divisible than others. When it comes to more complex situations, the courts will usually follow pre-established best practices. For instance, there are usually two options available in regard to retirement accounts and pensions. One option, also referred to as a reservation of jurisdiction, involves essentially reserving the portion owed to the spouse until the moment of payout. This means that when it is time for the employed person to retire, their former spouse will be entitled to a portion of the proceeds. The other option is to quantify how much the spouse’s share of the plan is worth, allocating assets equal in value to that spouse.
Some divisions are made to recognize previous investments. For example, consider a situation where one person pursued a higher education degree during the marriage. According to California law, their spouse is entitled to an equal share of that degree. But what does that look like? If you imagine a scenario where the physical degree is cut in half, or the spouse is awarded some honorary title, think again. In practice, having equal rights to the degree means that the courts will determine how much was invested into earning said degree, such as tuition payments and other related expenses, and reimburse the spouse for their share.
Finally, there is the matter of commingled assets. This is when both separate and communal property are mixed together. Consider the pension plan described in the above example. If you begin contributing to that plan before marrying your spouse, those initial contributions are separate property. However, contributions made while married would be considered communal property. While this may seem highly complicated, resolving such a situation is again a matter of determining what value each person’s share is worth and finding ways to distribute that value most practically.
Dividing Property in a Way That Works for You
Attempts at division of property can become quite complicated very quickly. To receive your fair share of the assets, you must work with an attorney who can help you determine which properties are separate versus communal and ensure that everything has been appropriately inventoried and acknowledged. At Bickford, Blado & Botros, we also have extensive experience in mediation and can help you work with your former spouse to divide your property and debts outside of court if that’s an option you’d like to pursue. For more information on the division of property in the state of California, contact our offices today.
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