How is Property that is not Located in California Divided in Dissolution of Marriage Cases?

How is Property that is not Located in California Divided in Dissolution of Marriage Cases?

Posted on May 26th, 2015

Division of Quasi-Community Marital Property in Divorce and Dissolution of Marriage

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What is Quasi-Community Property?

For purposes of a property division in marital actions or the rules governing marital property debt liability, Family Code Section 125 defines “quasicommunity property” to include (i) real and personal property, wherever situated, which would have been community property had the owner spouse been domiciled in California at the time of acquisition, and (ii) any property acquired in exchange for such property.

Property may be quasicommunity property only if it would have been community property had the owner spouse been domiciled in California at the time of acquisition (see Cal. Fam. Code 125). Necessarily, therefore, quasi-CP characterization turns on a threshold determination of how the common law separate property would have been characterized had the parties lived in California all along. (See Fredericks v. Fredericks (1991) 226 CA3d 875, 879).

The concept of quasi-community property comes into play when parties lived elsewhere (and acquired property) before making California their domicile and going through a divorce.

How is Quasi-Community Property Handled in California Divorces? 

How does the family court divide property in a divorce case (dissolution of marriage) when the property is located outside of California?  What if there is land that is located outside California?  Is the Court handling a divorce in Orange County, California authorized to assign property located in another state or country to one party or order that it be sold?   This article tackles some of these tough questions.

In practical terms, if the Family Court has personal jurisdiction over both parties to a divorce matter, the judge may have the authority under Family Code 2660 to divide marital property that is not located within the boundaries of California but is within the boundaries of another state.  This type of property is known as “quasi community property” if the property was acquired during marriage and is not from a “separate source” (like from money acquired by an inheritance, for example).  Family Code Section 2660 states,

   (a) Except as provided in subdivision (b), if the property subject to division includes real property situated in another state,
the court shall, if possible, divide the community property and quasi-community property as provided for in this division in such a
manner that it is not necessary to change the nature of the interests held in the real property situated in the other state.
(b) If it is not possible to divide the property in the manner provided for in subdivision (a), the court may do any of the
following in order to effect a division of the property as provided for in this division:
(1) Require the parties to execute conveyances or take other actions with respect to the real property situated in the other state
as are necessary.
(2) Award to the party who would have been benefited by the conveyances or other actions the money value of the interest in the
property that the party would have received if the conveyances had been executed or other actions taken.

In simple terms, the Court has two options when dealing with quasi-community property:

  • Order an “in kind” division of assets so that one party will receive the property located in another state and the other party will receive another asset of equal value;
  • Or in situations where an “in kind” division is not possible, the court can force the parties to take certain actions to carry out the court’s orders dividing the property or ensuring its sale.

The reason the statute is written in the manner in which it is written, specifically that the court can either award that property to one party and award something else to the other party of equal value or force the parties to carry out the terms of the judgment, is because the courts in California at the Superior Court level do not have the authority to order someone in another state to carry about the terms of its judgment.

For more information about division of assets in divorce cases in California and Irvine, click here.

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