• What every Husband should know about a Womans need for Girlfriends

    Husbands that do not understand a woman’s need for girlfriends and companionship are being grossly shortsighted. Many times as a therapist, these are the same husbands that frequent the tailgate at football games, fishing trips with buddies, and weekend golf outings. All of us need time with our gender, and a release time. History has always discussed the groups with women as well as men. It may be quilting groups in the eighteen hundreds, or shopping excursions in this decade. Women are in need of their female counterparts, to disclose, ask for advice, share, and bond. Not unlike men, and it is very healthy for women to do so.

    There is an inherent bonding that is important, and necessary for mental health. Women have raised their children, told their stories and carried on traditions at a more consistent pace than men. Part of this consistency is the mother daughter bond, as well as having girlfriends, to unwind and brainstorm with. A marriage where there is a lack of respectful independence is a marriage fraught with jealousy, and fear. Men that have issues with their wives spending time with girlfriends need to seek out therapy and focus on their own issues. An addendum is imperative here. When time with girlfriends is so extensive that it takes time from family, children and upkeep then there should be concern.

    We all encounter stress at home and the workplace. There is nothing better than time spent unwinding, relaxing, laughing, and even spending hobby time with your own gender. It is imperative for life to socialize,and bond. As humans we are social animals, there is no mistaking that fact. Socialization, and conversation with our own gender decreases stress, gives support, empowers, influences laughter, and helps problem solving.

    As therapists it is important that we not only encourage time with girlfriends, but explain to their husbands the necessity and how this is a win, win for everyone. There are in fact numerous times where husbands fears are actually projective in nature. Projection, in the sense that husbands are aware what they discuss with their peers and are worried there will be disclosure of dissatisfaction with the marriage. This is indicative once again how good communication and resolution can benefit the marriage and girlfriend time can occur without a problem.

    Time with girlfriends is normal, healthy and imperative. Combined with open communication it is an important adjunct in any marriage. Husbands need to confront their hypocrisy head on, and accept the importance of this bonding scenario. In the end it is nothing more than a necessary ritual of socialization, that occurs with every culture across the world.

     

    http://www.helium.com/items/1616347-what-every-husband-should-know-about-a-womans-need-for-girlfriends

  • Debts in a California Divorce

    My spouse ran up huge credit card debts during the marriage. In dividing assets and debts in the settlement agreement who should be responsible for these debts?

    In California, Family Code section 910 provides that the community is liable for all debts incurred during the marriage and prior to separation. It doesn’t matter whether the debt was incurred by one spouse for there own benefit or for the family. It also doesn’t matter whose name appears on the bill or the credit card statements. If it was incurred during the marriage and prior to separation it’s a community property debt and both spouses are equally liable. This means that when the parties are negotiating a settlement and tallying the marital balance sheet such debts should be divided equally. A better option might be that one spouse agrees to pay off the joint debts in return for a greater share of the community property. The spouse paying off the debts can at least make sure that joint debts are paid because as long as debts are jointly owed both spouses are financially responsible to the creditors.

    What if a married couple pays off one parties pre-marriage debts?

    Consider this example. Bob and Jackie get married. Bob has huge credit card debts that he incurred before the marriage. Bob and Jackie want to improve their credit rating so they can buy a house. They agree to pay off Bob’s debts. However, once they are debt free, Bob files for dissolution. In this case, Bob and Jackie have used community property earnings to pay off Bob’s separate property debt. California case law states that the community is entitled to a re-imbursement for the amount it paid to discharge one parties separate property debts. 1 So in the above example, the community is entitled to a reimbursement for paying Bob’s debts.

    What if one party uses their separate property to pay off community property debts?

    In this example after they get married Bob and Jackie go on vacation and rack up huge debts. Jackie dips into her brokerage account which she built up prior to the marriage to pay off the vacation debts. In this case, Jackie has used her separate property to pay off community debts. California case law states that a spouse who, during marriage and before separation, uses separate property to satisfy a community debt is presumed to make a gift to the community. 2 So in the above example, Jackie is not entitled to a re-imbursement for paying the community vacation debts.

    There is one important exception to his rule. Family Code section 2640 provides that where one party uses their separate property for the acquisition of community property, the paying spouse has a statutory tracing right of reimbursement if they have not waived the right in writing. Contributions to the acquisition of property include downpayments, payments for improvements, and payments that reduce the principal of a loan used to finance the purchase or improvement of property. They do not include payments of interest on a loan to purchase property, or payments for maintenance, insurance, or taxation of the property. So in the above example, if Jackie had used her separate property brokerage account to pay off the principal on a joint mortgage or for a downpayment she would be entitled to a reimbursement of that amount.

    After separation one spouse uses their separate property earnings or property to pay off community debts.

    In this example after Bob and Jackie separate, Jackie continues to drive the BMW which was purchased with a loan during the marriage. Bob continues making the loan payments on the car. Can Bob claim a reimbursement credit for all the payments he makes from the date of separation to the date of trial?

    California case law has developed the general rule that a spouse who, after separation, uses earnings or other separate property to pay pre-existing community obligations should be reimbursed out of community property upon dissolution. 3 These are traditionally called “Epstein credits” after the California Supreme Court case that established the rule.

    Under this general Bob could, in theory, claim credits for all the payments he makes on the car loan after separation. But what if Bob was driving the car and making the payments. Wouldn’t it be unfair for Bob to have the use of the car and also claim reimbursement credits? That’s what the Court said in Epstein. It laid out an exception to the general rule where the paying spouse also uses the asset and the “amount paid was not substantially in excess of the value of the use.” So this means that Bob could not claim credits for the monthly payments if he drives the car but probably could claim a credit if he paid of the entire loan.

    There are two other important exceptions to the Epstein general rule that a spouse who uses separate earnings or property to pay off pre-existing community obligations is entitled to a reimbursement: (a) where there is an agreement between the parties that the payments will not be reimbursed, and (b) where the payments were intended as a gift or as child or spousal support.

    After separation one spouse uses community property funds to pay of their living expenses. What are the consequences?

    In this example, Bob and Jackie separate and Bob agrees to pay $1000 per month in support and “whatever else you need out savings.” Jackie takes out $1,000 community property from the joint bank account to pay various living expenses. California case law provides that the community is entitled to re-imbursement where one spouse uses community property to pay separate obligations after separation to the extent that exceed a reasonable amount for child and spousal support. 4 A reasonable amount would probably be the amount of guideline support that a Court would order in an application for temporary child and spousal support. If that amount were $1,500, in the above example, Jackie would have to reimburse the community $500 ($2,000 – $1,500 she received). In the division of community property she would receive $250 less in community property. Since this rule flows from Epstein, the parties can waive the rule in writing and agree that such payments shall not reduce the community estate.

    After separation one spouse stays in the family home while the other spouse pays the mortgage. What are the consequences?

    It’s often the case that after separation one spouse moves out of the family home (“the out-spouse”) while the other spouse stays in the home with the children (“the in-spouse”). The out-spouse, usually the husband, may offer to maintain the status quo by continuing to pay the mortgage payments and other payments such as property taxes to maintain the property. In such a situation the in-spouse should be warned that there may be serious consequences of such an arrangement at the time of trial.

    We’ve already seen one consequence. The out-spouse paying the mortgage payments may be entitled to Epstein credits because they are paying separate property earnings towards a community property debt unless there was an agreement to waive such reimbursements or such payments were a form of child or spousal support.

    The other major consequence is that if the reasonable rental value of the family home is more than the mortgage payments, the in-spouse may be required to re-imburse the community for the difference in these payments between the date of separation and the date of trial. These are called Watt’s charges after the case that established the rule. 5. The general rule is that where one spouse has the exclusive use of community assets during the date of separation and trial, that spouse may be required to compensate the community for the reasonable value of that use. Consider this example. Bob and Jackie separate. Jackie and the kids stay in the family home after separation. Bob agrees that he’ll continue to support the family and pay the mortgage and other expenses. The mortgage payments are $1,500 per month. If Jackie had to pay the fair market rent for the property she’d pay $2,500 per month. Bob pays the mortgage for 10 months from the date of separation to the date of trial. Bob could argue that he should be re-imbursed Watt’s charges of $10,000 ($2,500 – $1,500 x 10). In a division of community property he’d be entitled to an extra $5,000. Bob could argue that he should also be entitled to Epstein credits of a further $15, 000 ($1,500 x 10) which would increase his share of community property by $7,500.

    This would mean that Jackie’s entitlement to community property would be reduced by $25,000 when she thought that Bob was supporting her and maintaining the status quo? Isn’t this grossly unfair? 7. You’d think so but that didn’t stop the Court of Appeal awarding Epstein credits and Watts charges in similar circumstances in In re Marriage of Jeffries (1991) 228 Cal. App. 3d 548. But wait a minute. Isn’t there an exception to the rule where payments are made “in lieu of spousal support?” The answer is yes “but” this has to be clearly spelled out before the Court will treat such payments as support. In Jeffries, there was even an Order of the Court that said the payments were “in lieu of spousal support.” However, the Order also said that the Court retained jurisdiction to characterize these payments and determine whether the Husband should be entitled to reimbursements.

    In another case the Court of Appeal reached exactly the opposite conclusion to Jeffries. 6. In this case the husband also paid the mortgage pursuant to a temporary court Order “in lieu of spousal support” and at trial claimed Epstein credits and Watts charges. The Court of Appeal held that public policy and the language of the Court order required that the Court deny the husband’s claims for Epstein credits. The Court then decided that since the wife was, in effect, paying the mortgage she would not have to pay any Watt’s charges because the monthly mortgage payments were the same as the fair market rental value of the home.

    The only solution to this mess is for the parties and their attorneys to agree early on in the proceedings whether a spouses payment of community debts (such as the mortgage) and one spouse living in the family residence should be treated as spousal support which does not generate Epstein credits or Watt’s charges. If it’s treated as spousal support any agreement or Order should contain explicit language that mortgage and other payments by the out-spouse and exclusive residence by the in-spouse in the family home “shall be treated” as spousal and child support and the paying spouse shall not receive any reimbursements such as Watt’s, Epstein, Jeffries credits and charges.

    Who is responsible for credit card debts?

    Family Code 2623 (a) provides that debts incurred after separation but before the judgment of dissolution are confirmed to the spouse who incurred the debts if they are for “non-necessaries of life” of the spouse or the minor children. If they are incurred for the “necessaries of life” of the spouse or the minor children, then they will confirmed to either spouse according to each parties needs and abilities to pay when the debts was incurred, unless there’s a written agreement or order for support.

    Generally, debts incurred during the marriage shall be divided between the parties. However, Family Code 2625 gives the court the power to assign a debt incurred during the marriage to one spouse if it “was not incurred for the benefit of he community.” 8 Further, Family Code 2602 provides that the court may also award an offset against a party’s community share if it finds that amounts were deliberately misappropriated by a wrongdoing spouse.

    Footnotes:

    1. Marriage of Walter (1976) 57 Cal. App. 3d 997.

    2. See v. See (1966) 64 Cal. App. 2d 778. In Re Marriage of Nicholson (2002) 104 Cal. App. 4 289, the Court of Appeal held where Husband had used $30,000 that his mother had given him as a gift (i.e. separate property ) to pay off the credit card ( community property debts) so they could qualify for a loan to buy a house, he was not entitled to a re-imbursement.

    3. In re Marriage of Epstein (1979) 24 Cal. 3d 76. Also In Re Marriage of Tucker (1983) 141 Cal. App. 3d 128.

    4. Epstein, above; In re Marriage Stalworth (1987) 192 Cal. App. 3d 742.

    5. In re Marriage of Watts (1985) 171 Cal. App. 3d 366.

    6. In Re Marriage of Garcia (1990) 224 Cal. App. 3d 885.

    7. This is the conclusion of one Family Law Commissioner: “It is fundamentally unfair for one spouse to move out and to allow a post-separation living arrangement to stabilize on one set of financial assumptions and then, without warning to the other spouse, introduce for the first time at trial a concept as pernicious as a Watts credit claim to set up an entirely different set of financial assumptions.” Commissioner Richard Curtis (2003)

    8. Marriage of Cairo (1988) 204 Cal. App. 3d 1255. Gambling debts incurred on credit cards during marriage assigned to Husband.

    © 2007 Warren R. Shiell. All rights reserved. The information contained in this website is an “Advertisement.” It is for informational purposes only and shall not constitute legal advice. Nothing in this Website shall be deemed to create an Attorney-Client relationship. An Attorney-Client relationship shall only be created when this office agrees to represent a Client and a Client signs a written retainer agreement.

    By Warren R. Shiell Esq., Attorney at law, at http://www.la-familylaw.com

  • Property Issues in California Divorce

    Steel Panther "Community Property" (Making of) DIRTY – watch more funny videos

    What is Community Property?

    California is a community property state in which spouses are entitled, with some exceptions, to an equal division of community property and debts in a divorce (called dissolution in California).

    Community property is all property, in or out of state, that either spouse acquired during the marriage through the efforts of either spouse or with community property funds. This means that, even if only one spouse worked during the marriage and the other stayed at home raising children, both spouses are entitled to one half of the community property. “During marriage” refers to the time period from the date of marriage to the date when the parties legally separate. The date of separation is often contested because it determines the extent of the community property estate. The courts have said that separation occurs where one spouse subjectively intends to end the marriage and does something to evidence that intent. It could be moving out of the family home, telling your spouse the marriage is over, arranging for a new place to live, etc.

    What is Separate Property?

    The parties are entitled to keep their separate property which is not divided in a dissolution. Separate property is any property that is acquired before the marriage, including any rents or profits received from those items; property received after the date of separation with separate earnings, inheritances that were received before or during marriage; and gifts solely to one spouse.

    Do debts and credit cards also have to be divided?

    Debts are also classified as either community or separate property debts. With few exceptions, debts incurred during the marriage are community property debts that will be divided equally in the dissolution. It does not matter whose name is on the debt.

    For example, credit card debts incurred during the marriage are community property debts regardless which spouse’s name is on the credit card. Student loans are one of the main exceptions to this rule. In certain circumstances, the community may be entitled to a re-imbursement if the couple pays off one spouse’s student loans during the marriage. Debts that you incurred before marriage or after separation are separate property debts.

    What happens to the Family Home?

    The family home in California is often the marriage’s most valuable asset. The division of the family home can be complicated if there are minor children and one spouse wants to stay in the home. The community property interest in the home is further complicated where the property is in the name of one spouse and was acquired prior to the marriage but the mortgage payments have been paid from community earnings. Parties should also be aware that if one spouse remains in the property after separation they may be incurring indebtedness to the other party if the fair rental value of the property exceeds the mortgage, taxes and insurance payments on the home. These are called Watts claims. The reverse may also be true. If the spouse living in the house is paying the mortgage which exceeds the fair rental value, they may be entitled to what’s called Epstein credits.

    Am I entitled to a share in my spouse’s pension?

    Another valuable asset in a marriage is a pension or retiremement plan. The non-employee spouse is entitled to a portion of the plan that was earned during marriage. To ensure that any pension settlement is enforceable it is advisable that any settlements regarding pensions are contained in a “Qualified Domestic Relations Order” (QDRO) signed by the Court.

    How do I figure out the extent of my husband or wife’s property?

    Each party is required by California law to file a preliminary and final “declaration of disclosure” with the Court that they have served an Income and Expense Declaration and Schedule of Assets and Debts on their spouses. The final declaration can be waived by the written agreement of the parties. The disclosures will list each spouses community property assets and debts and separate property. Most disputes involve the extent and valuation of community property assets. If a spouse tries to hide assets, your attorney can employ various discovery tools forcing a spouse or a third party to turn over financial records. For example, they can subpoena the records of third parties such as banks and CPA’s. In complicated cases it may be necessary to employ the services of a forensic accountant. It is a good idea to minimize this risk by taking some simple steps as part of any pre-divorce planning. You should make copies of important financial documents such as tax returns, W2′s, bank and brokerage statements and keep them in a safe place.

    The law requires the parties to make full disclosure of all their assets and liabilities and also any business investments and opportunities. The case of Marriage of Rossi, illustrates what can happen when one party tries to conceal assets. In 1996 Denise Rossi won $1.3 million in the California State Lottery. She chose to conceal the winnings from her husband and filed for a divorce 11 days after learning of her winnings. She had been married for 25 years. 2 years after the case was over and a Judgment had been entered, her ex-husband discovered that his ex-wife had won the lottery. He filed a Motion and the judge gave all of the $1.3 million dollar lottery winnings to the husband, since the wife had intentionally not disclosed her winnings in the divorce proceedings. News reports indicate that Denise ended up filing for bankruptcy.

    Don’t forget some often overlooked assets!

    Some assets that are easily overlooked but may turn out to be valuable include:

    o Tax refunds

    o Frequent flyer miles

    o Season tickets

    o Prepaid insurance

    o Vacation pay

    o Club memberships

    Are their tax consequences of a property settlement?

    It’s important that you consider the tax consequences of any property settlements during a dissolution. Generally, IRC section 1041 provides that transfers to a former spouse incident to a divorce are not taxable. However, if either spouse agrees to sell an asset as part of a settlement there may be a tax consequence. For example, if parties agree to sell the family home and divide the net proceeds they may have to pay capital gains tax on any gain. The Tax Reform Act 1997 gives each spouse a $250,000 exemption from gain realized on the sale or exchange of the principal residence. Similarly, the tax consequences of distributions from pension plans now or in the future should also be considered.

    © 2007 Warren R. Shiell. All rights reserved.

    The information contained in this website is an “Advertisement.” It is for informational purposes only and shall not constitute legal advice. Nothing in this Website shall be deemed to create an Attorney-Client relationship. An Attorney-Client relationship shall only be created when this office agrees to represent a Client and a Client signs a written retainer agreement.

    By Warren R. Shiell Esq., Attorney at law, at http://www.la-familylaw.com