Property Division

Carrying Your Partner’s Student Loan Debt After Divorce

February 15, 2022 | by Arlette Argyris

As most people are aware, student loan debt is crippling people across the country. Many borrowers are strapped with high interest rates on their principal loans that essentially never allows the owing amount to decrease. However, could you imagine being bogged down by your own debt in addition to the debt of a spouse you were divorcing? This is a reality for many borrowers who consolidated their loans through a Department of Education program for married couples back in the early to mid 2000’s. The perks for consolidating loans for married couples were amazing, the couple only had one payment per month instead of two at a much lower interest rate.

However, when the housing market of 2008-2010 began and everyone lost their jobs, marital strife was high and divorce rates were even higher. What couples going through divorce at this time were now finding out was that the consolidated loan they signed up for was not particularly easy to split. More than 14,000 people participated in this program, which the federal government closed officially in 2006. For many, it seemed like a straightforward idea at the time, but what these borrowers couldn’t foresee was a program that had no way to disentangle the consolidated debts.

One particular borrower took to Congress to change this completely misguided approach to helping borrowers. Patrick Stebly has been stuck in this situation since his divorce in 2013 and has been working tirelessly over the past five years to rectify the situation for every other borrower. Stebly’s advocacy has now prompted legislative action. A new bill introduced by Senator Mark Warner of Virgina and Representative David E. Price of North Carolina, would allow joint loans to be split proportionally based on original loan amounts for those going through divorce or suffering domestic violence. The bill was first introduced in 2017.

I Found Out That My Ex Failed To Disclose An Asset During Our Divorce. Now What?

January 5, 2021 | by Arlette Argyris

If you are in the middle of a divorce and suspect that your soon-to-be ex is hiding assets from you, then it might be a good idea to hire a private investigator or a forensic accountant to get the bottom of things. It is much easier (and much more cost effective) to deal with the issue of hidden assets before the divorce is finalized, than it is to deal with it after. However, if your ex is successful in hiding their assets during the divorce and you don’t find out until after the divorce is finalized, then you can file a motion in the court where your divorce was filed to reopen the case.

At divorce, both spouses are required to disclose all of their assets regardless of whether they are separate property or community property. California is a community property state, which generally means that all debt or earnings made during the marriage belong to both spouses equally and any property or debt acquired before the marriage is separate property. While there are some exceptions to the general rule, such as if one spouse receives an inheritance during the marriage which is seen as that spouse’s separate property, most assets received during the marriage are seen as belonging to the community.

If your ex failed to disclose an asset before the divorce was finalized, the remedies you are entitled to, in part, depend on whether your ex hid the asset intentionally, with a conscious disregard for your rights, or with the purpose of subjecting you to a cruel or unjust hardship.^[1] During marriage and at divorce, spouses owe each other a fiduciary duty. This duty includes the obligation to make full disclosure to the other spouse of all material facts and information regarding all assets in which the community has or may have an interest and debts for which the community is or may be liable, to provide equal access to all information regarding those assets and debts, and the duty to not take unfair advantage of one’s spouse.^[2] So if your ex hides an asset during the divorce, they have breached their fiduciary duty.

Judge vs. Commissioner – Is There a Difference?

February 26, 2019 | by Andrea Mah

Some San Jose divorce, custody and/or support matters are assigned to a department where a judge is presiding, while other matters are heard in front of a commissioner. So, what is the difference between the two, and is one better than another?

A judge is elevated to the bench either by election or by appointment by the Governor. A judge must also be a licensed attorney to be eligible to serve on the bench. A commissioner, on the other hand, is an individual who is hired by the court to help out with a judge’s case load. Commissioners must also be licensed attorneys to be eligible to serve as a commissioner. Often, Commissioners work very closely with judges, and judges consider them essential for managing the work of the court.

Commissioners can perform judicial duties involving the determination of contested issues only upon the stipulation of the parties, but with that stipulation they have the same powers as judges. That means that the commissioner has the same power as a judge to hear a court case and make legally binding judgments. Per California Code of Civil Procedure Section 259, “[s]ubject to the supervision of the court, every court commissioner shall have power to do all of the following:

Nesting / Birdnesting – Easing the Impact of Divorce on Children?

January 7, 2019 | by Andrea Mah

Most people recognize that divorce isn’t easy on children, no matter what the circumstances surrounding the divorce are. However, for may reasons, it is helpful to try to keep the divorce process as low-conflict and as amicable as possible.

Some couples are implementing “nesting”, also known as “birdnesting”, as a way to ease the impact of divorce on their children. So what is nesting? Generally, nesting occurs where parents keep the main house and then share a separate house or apartment where they will stay when they are not at the main home with the children.

The idea behind nesting is that it is less disruptive for the children to remain in the family home, and have the parents rotate to the separate location, as opposed to shuffling children back and forth between two different households. This type of nesting is beneficial to children because not only do they get to stay in a home that is familiar to them (and thus relieving the need to take belongings to different homes), but it often allows them to remain at the same school and keep in touch with friends.

Pet Custody and Visitation

October 3, 2018 | by Arlette Argyris

Often parties wonder what will happen to their pets during a divorce. Will the parties share the pets? Can you negotiate custody of a pet as you would a child? Thus far, pets have always been treated as property in the eyes of the family court. This upset avid pet lovers, but the reality of the situation is that pets typically went where the children went.

However, Jerry Brown has just signed a bill in California granting judges the authority to settle pet custody disputes similarly to how child custody disputes are handled. The law is set to go into effect on January 1, 2019. While many believe this is a positive step forward, and it certainly is as parties will now have rights over their pets, the concern is that it will bring new havoc and discord to family law cases. Nevertheless, the court’s previous stance on pets seemed quite harsh, particularly to those parties who love their pets like humans or like their own children. Pet owners were often indefinitely separated from the pets they loved with absolutely no recourse.

Now, parties can either agree to a visitation plan with their pets or have a Judge decide. This brings up several additional questions, however. Can one party request pet support? Or perhaps the parties will have to share in the cost of pet health insurance? The outcome of this new law remains to be seen and will be far reaching but will prove to make pet owners happy with the family court.

Incentive to Hurry Up and Get a Divorce?

July 9, 2018 | by Arlette Argyris

Trump’s administration has recently made several changes to current tax laws and among many other areas, the tax implications of divorce have been greatly affected. If there has ever been a time to “hurry up and get a divorce” it may be now.

A change in the new tax laws will eliminate a major break that many often took into consideration when contemplating divorce. That is the ability to deduct alimony or spousal support payments on your taxes. Any divorces finalized after December 31, 2018 will no longer receive the benefit of this tax deduction, which is why countless lawyers and financial advisors are warning clients who are contemplating divorce to act fast.

Agreements signed before the end of the year will still qualify for this deduction, but this can have huge financial implications when one party earns significantly more than the other. For decades, individuals paying alimony or spousal support to a former spouse were able to deduct the payments from their taxes, which often prompted the paying spouse to pay slightly more than they normally would agree to. This could have a huge impact on the paying spouse especially when there is a large gap in income between the two parties. According to the IRS, a staggering 600,000 Americans claim this deduction.

California Community Property Laws – An Overview

May 23, 2018 | by Arlette Argyris

There are many financial issues to consider in a divorce case. One of the most significant issues is the division of property. “Property” includes both physical assets, such as a home, vehicles, bank accounts, etc., as well as deferred compensation, such as pension plans, 401ks, and stock plans. “Property” also includes debts. In a Santa Clara County divorce case, and in California at large, community property laws govern the division of all property. In general, in California, all property acquired during marriage is “community” in nature and must be divided equally upon divorce. All property acquired prior to marriage, or after separation is the acquiring party’s “separate” property. Additionally, any property acquired during marriage by gift, bequest, inheritance or the like, is “separate” property, as well. The characterization of an item of property as “community” or “separate” will determine how the item is divided in a divorce.

At a basic level, “community” property must be divided equally, while “separate” property is confirmed to the party who acquired it. In reality, the division of property is not quite so simple. Often times during marriage, “community” and “separate” property become mixed, or “commingled.” In that case, it needs to be determined whether it is possible to “trace” the separate property so that it can be returned to the separate property owner. Additionally, issues can arise when property is purchased during marriage, but only put in one spouse’s name. The value of assets can also be an issue.

Other financial issues to be considered include how funds are spent after parties separate. There are specific automatic orders that go into place once a party is served with divorce paperwork, preventing both parties from transferring/moving funds and/or making large purchases without the agreement of the other spouse or a court order. Additionally, each party’s income and expenses should be taken into account, to determine whether spousal and/or child support are appropriate. When setting support, it is important to know what constitutes “income” for purposes of determining support. Income is not necessarily limited to funds earned from employment, but can include commissions, bonuses, rental income, stock proceeds, interest, unemployment and disability benefits, and the like. Another consideration when setting support is whether both parties are working. If not, the court can order one or both parties to seek work so that he/she is able to contribute to the support of the minor children and/or so that he/she can become self supporting, for purposes of spousal support.

9 Mistakes That Could Cost You In Divorce Court

February 7, 2018 | by Arlette Argyris

When going through a divorce, the best case scenario is that everyone remains amicable and the need for litigation is avoided.

However, if litigation is inevitable, both sides at least want to try to come out of the process financially secure. These are common mistakes, all of which are avoidable, but all of which almost always end up costing you when going to court:

1. Going to court without a lawyer

How the New Tax System May Affect California Divorce, Custody and Support Cases

February 1, 2018 | by Arlette Argyris

President Trump’s tax reform bill, which was recently signed in to law, includes many changes to the United States Tax Code.

Some of those changes will in all likelihood directly affect California Family Law cases including divorce cases, custody cases and support cases. Child support and spousal support are two of the significant areas of Family Law likely to be affected by the new tax changes. Specifically:

Child Support: Currently the California guideline child support calculator uses a number of factors, including each parent’s tax bracket, filing status, deductions, including mortgage interest and property tax deductions, and personal exemptions to determine the amount of child support owed. Under the new tax laws, nearly all of those factors have been modified. The tax brackets have been revised such that many people will enjoy a lower tax rate. Additionally, the standard deduction has roughly doubled for all taxpayers. However, the personal exemption for the taxpayer, his/her spouse and children, has been eliminated. Additionally, the amount that can be deducted for mortgage interest has been reduced to include debt of up to $750,000, down from $1M. All of these changes may affect how much a supporting parent could have to pay for child support.