Lease Agreements: What Happens in Divorce?

Mani con chiave sfondo azzurroA man recently approached us with a complicated situation. Though he and his wife mutually agreed that divorce was in their family’s best interest, her reaction was negative to say the least when he served her with divorce papers.  She promptly threatened to give 30 day notice to dissolve the lease agreement on the condo the couple rent, which, problematically for the husband, is leased only in her name. After those 30 days, she plans to move to another town, into an apartment where she has already cosigned a lease with her new boyfriend. To add fuel to the fire, the couple share a 12 year old daughter who wishes to remain with the father because she is afraid of her mother’s boyfriend. Of course, the mother wants custody of the daughter. This man states he can’t afford the rent on his own, and he believes his wife is trying to put him on the streets. His questions: Can she just throw him out? Can she just end the lease?

The leasehold interest, although hers as far as the landlord is concerned, is community property, so it therefore belongs to both the wife and the husband. Legally, her ability to evict him as a subtenant is exceedingly dismal. If she proposes to stop paying the rent and move out herself, that might be prohibited under the automatic restraining orders printed on the second page of his petition, because she’d be disposing of community property without his consent. However, we of course had to give him the honest truth about this situation. This type of discrepancy is highly technical and academic; dealing with it in a divorce case would be time consuming, and the result problematic. The reality is that if no one is paying the rent, he’ll have the landlord evicting him, no matter the status of his wife. The best thing for this man to do for himself and his daughter is to find a place to live that he can afford. That way, he isn’t dependent on the actions of his soon to be ex wife.

For more information on community property, as well as tenant protection, please visit their following respective pages on our website: http://stanprowse.com/community-property and http://stanprowse.com/real-estate-law/landlord-tenant-law

 

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Premarital agreements: prenups and postnups, oh my!

Prenuptial agreement and divorce law concept as a justice scale with wedding rings as a symbol of a relationship contract before a marriage or civil union or getting divorced.

A man recently approached us with questions regarding the financial steps that should be taken before marriage. This man is engaged to a woman with over $40,000 in student loan debt. He does not want to become responsible for this financial burden once they’re married, but doesn’t know whether a prenup or a postnup would better serve his situation.

First, it needs to be understood that the separate property of one spouse is not liable for the premarital debts of the other spouse. Community property, however, is liable for the premarital debts of the parties. Therefore, money placed in a joint checking account after marriage is considered community property, which in turn can be accessed by the creditors of this man’s future wife. The solution is to prevent community property from arising in one’s marriage through a premarital agreement.

This can be arranged in a prenup which provides that all earnings during the marriage remain separate property, and that any business you may own when you marry will remain separate property. We advised this man to carry out a prenup rather than a postnup, as the validity of the latter might be questioned as a fraudulent conveyance. Plus, spousal support can be waived in a prenup, but not in a postnup. Of course, obtaining a bullet-proof premarital agreement is extremely difficult due to relatively new statuary requirements. A good place to start would be with both spouses hiring separate lawyers, and look at the situation holistically.

For more information on premarital agreements, please visit our website: http://stanprowse.com/premarital-agreements

Rental Income on Community Property

Is an ex spouse entitled to half of rental income on a community property asset?

Property-Presumption5777583A divorcing couple decide to let their family home foreclose. The ex husband was living in the property at the time. The husband filed for BK to delay the foreclosure and rented the house. Then the husband decided to start paying the mortgage again in an attempt to keep the property. Is the ex wife entitled to half the rent the ex husband is receiving?

Our Answer:

Assuming the property is still in both names, the wife is entitled to half the rent her ex is receiving. Sounds as if the wife should take him to small claims court. It also sounds as if the house is an “unadjudicated asset” (the divorce judgment doesn’t say who gets it). In that case, if it ever becomes worth anything, you might want to go back to divorce court and ask for it to be sold and the proceeds divided. If the house is an unadjudicated asset, there is a possibility that the small claims court has no jurisdiction to deal with who gets the rent, and that a small claims court judge might refuse to hear your case and send you back to divorce court.

For more information on Community Property during Divorce, Please visit our website: http://stanprowse.com/community-property-law-california