Dividing Property in a Divorce Involving Financial Abuse

California is a no-fault divorce state. This means that a couple seeking a divorce is not required to prove that someone did something terribly wrong in order to end the marriage. It is enough that one spouse believes the relationship is at an end.

Because California grants divorces without evidence of wrongdoing by a spouse, in general, what each spouse did that ended up contributing to the downfall of a marriage is not considered by the court when dividing up assets and debts. However, cases involving financial abuse can impact property division and even spousal support and payment of legal fees.

 Because California is a community property state, assets and debts acquired from the date of marriage through the date of separation are presumptively community property and typically divided equally between the parties. However, there are exceptions, including inheritances and gifts, which we have discussed in earlier blogs on our site.

Financial abuse is broadly defined but typically occurs when a spouse exerts control by taking away the other spouse’s access to finances, unilaterally making financial decisions that negatively impact the marital estate, or hiding assets.

A spouse can seek relief by filing for domestic violence and or breach of fiduciary duty.

If there is a criminal conviction for domestic violence misdemeanor, there is a rebuttable presumption that a spousal support award to the convicted spouse from the injured spouse is prohibited, the injured spouse shall not be required to pay any attorney’s fees of the convicted spouse out of the injured spouse’s separate property (the attorney’s fees and costs incurred by the parties shall be paid from the community assets), and the injured spouse is entitled to up to 100% of the community property interest in the injured spouse’s retirement and pension benefits.

If a court determines that a spouse has breached a fiduciary duty, the court can order up to 100% of a community asset to the breached party in response to the financial harm.  It is best to consult with an experienced family law attorney to discuss the nuances and whether your particular case could apply.

There are many protections in place for survivors of financial abuse. There are a wide array of resources available to those seeking help – and the attorneys at Cardwell, Steigerwald, Young, LLP are here and ready to play our part. Our firm has decades of combined experience that can help individuals trying to navigate through the toughest family law issues. Contact our team today to begin speaking with experienced legal experts, and thoughtfully plan your next best steps.