Bar Exam

Front 1

Community Property Introducton

Back 1

All properites acquired during marriage are presumed CP. All properties acquired before mariage or after permanent separation or by gift, bequest, devise or descent and rents, issues and profits of SP are SP. Further, properties acquired by married individual while leaving outside CA, which would have been CP if they were leaving in CA is characterzed as Quasi Community Property (QCP) and is treated as CP at divorce or legal separation. A mere change in the form of the asstes does not change the characterization of the assets unless one spouse alter the character of the asset from CP to SP or SP to CP.

Front 2

Personal Injury Recovery

Back 2

If cause of action arises during marriage, recovery is CP, otheriwse it is SP but CP or other spouse SP must be reimbursed for expenses paid on acount of the injury. Cause of action arises when injury is inflicted. But at divorce, community estate personal injury damages will be awarded entirely to the injured spouse unless the interest of justice require otherwise. Personal injury recover against the other spouse is alaways the injured spouse SP.

Front 3

Retirement Pensions

Back 3

CA treats vested and unvested retirement pensions as CP to the extent that the right to the benfits was earned during marriage. Courts apply a "time rule" to apportion the SP and CP interest of the pension earned both during and after marriage.

Front 4

Disability Pay and Workers Compensation

Severance Pay

Back 4

To the extent disability pay and workers compensation is inetended to replace marital earnings they are CP. To the extent they are intended to replace post divorce earnings, they are SP.

When severance pay resembles a retirement pensions, it has been treated as CP (because it was earned by marital labor). but when severance pay is inetended to sustain the worker for a short time until his next job, it has been anologized to disability pay and trated as SP (because it replaces postdivorce lost wages)

Front 5

Stock Optoins

Back 5

In marriagte of Hug, the court treated optoins as earned from the time the worker work for the company and court applies the pension "time rule" to determine the CP interest in the option.

Front 6

Business and Professional Goodwill

Back 6

To the extent the goodwill is earned during marriage, CA treats it as CP.

Front 7

Education and Training

Back 7

Education and training acquired during marriage are not treated as divisible property. But at divorce, unless there is an agreement to the contrary, there is an equitable right of reimbursement with interets to the community when 1) community funds are used to pay for the education or traning or repay the loan related thereto and 2) the education or training substantially enhances the earning capacity of the party.

Equitable defenses: 1) the community has already substantially benefited from the education or training (more than 10 years have passed bet the contribution and divorce) 2) the other spouse also received community funded education; 3) the need for spousal suport is reduced as a result of the education or training.

Front 8

Life Insurance

Back 8

For Community funded policy, if the deceased spouse named beneficiary other than the surviving spouse, the named beneficiary receives the deceased spouse one half community interest in the policy and the surviving spouse gets the other half.

Front 9

Property Insurance Proceeds

Back 9

Property insuarnce porceed from one spouse SP remains SP even if premium paid by Community, subject to reimbursement of premium paid.

Front 10

Premarital (Antenuptial) Agreement

Back 10

Effective w/o consideration. Must be signed by both parties (SOF). Exception : Fully execusted and Estoppel. May limit or waive property rights and spousal support. Premarital agreements ma not promote divorce and must be voluntary. It is unenforceable if unconscionable when executed and the burdened party do not have adequate disclosure of the others party's wealth.

Front 11

Transmutation

Back 11

Is the transmtation of the character of a property from CP to SP or SP to CP. Before 1985 oral agreement and even donative acts inferred from one or both parties behavior are recognized. Transmutatoin made on or after 1985 must be evidenced by express declaration in writing signed or accepted by the spouse whose interest is adversely affected. Does not apply to nonprobate beneficiary designation.

Front 12

Description of a property under a will or trust

Back 12

Not binding

Front 13

One spouse gaining advantage over the other

Back 13

Presumption of undue influence. Confidential relationship betweeen spouses imposes a duty of highest good faith and fair dealing.

Front 14

Maried Woman Special Presumption

Back 14

When title to property was placed on married womans name alone before 1975, that property is presumptively the married woman's SP. If title is taken in tenancy in common by married couple, W gets one half interest as her SP and H takes his one half interest as CP. Married woman special presumption is irrebutable against good faith purchaser.

Front 15

Lucas

Back 15

1980 Lucas case held that taking title in a joint and equal form is inconsistent with the preservation of SP interest. SP contributor presumed to have made a gift.

January 1, 1987 Statutory Scheme. All property held by the spouses in joint form is presumptively CP for purposes of distribution at divorce or legal separation. The presumption can be overcome only by a collateral written agreement or statement in a documentary evidence of title that the property is SP and not CP. SP contributor will be reimbursed without interest or appreciation.

Front 16

Tracing funds from commingled account

Back 16

Available community funds presumed to have been used to pay family expenses, Absent reimbursement agreement gift is presumed if SP funds used to defray family expenses.

Tracing Methods :

1. Exhaustion Method : At the time the assets was purchased, community funds in the account had already been exhausted in payment of family expense and therefore assets must have been purchased with Separate funds.

2. Direct tracing: at the time the assets was purchased, there were separate funds available, and SP proponent intended to use separate funds to purchase a SP asset.

Front 17

Jointly Titled Bank Account

Back 17

Probate code provides that contents of bank account jointly held by a married couple is presumptively CP, but could be overcome by tracing.

Front 18

Community Funds/Labor enhanced SP

Back 18

Van Camp Accounting is use where the character of the business was the primary cause of its growth. Manager's services are valued at the going market salary. The amount of family expenses that were paid from the buss is subtracted. The remaining is CP, the rest is SP.

Pereira Accounting is use if a spouse management of the business was the primary growth of the business. SP consists of managers separate capital plus fair rate of return.