My response:
Probably yes, and yes. However, it has been suggested that deliberate misappropriation is not an exception to equal division, rather it is an assurance that equal division will occur. Nonetheless, a court may award or offset against existing property an amount that the court determines to have been deliberately misappropriated by a party. [Fam C §2602] It is key to a determination of deliberate misappropriation that the misappropriation is found to have been intentional.
However, once the court makes a determination that the misappropriation was intentional, the court may charge the misappropriating party with the funds that have been misappropriated, whether or not the funds or assets are still in existence. [In re Marriage of Economou (1990, 3rd Dist) 224 Cal App 3d 1466, 274 Cal Rptr 473] Mere negligence by one spouse is not sufficient to justify an unequal award of community property. Some form of "calculated thievery" is necessary, not simply the mere mishandling of assets. [In re Marriage of Partridge (1990, 3rd Dist) 226 Cal App 3d 120, 276 Cal Rptr 8]
Cases that have found deliberate misappropriation include:
(1). Gifts by one’s spouse to a third party [See Re Marriage of Hopkins (1977, 2nd Dist) 74 Cal App 3d 591, 141 Cal Rptr 597 (money that husband placed in joint account with his name and son’s name—amount charged to husband)]
(2). Gambling losses [See In re Marriage of Cairo (1988, 1st Dist) 204 Cal App 3d 1255, 251 Cal Rptr 731 (obligations incurred on credit cards to allow husband to gamble assigned to husband alone)]
(3). Criminal conduct causing a loss of community property [See In re Marriage of Beltran (1986, 1st Dist) 183 Cal App 3d 292, 227 Cal Rptr 924 (husband convicted of serious felony that resulted in dismissal from Army and loss of all military benefits, including pension and accrued leave; husband charged with receipt of the community portion of forfeited pension and accrued leave)]
(4). Improper management of community business [See In re Marriage of Czapar (1991, 4th Dist) 232 Cal App 3d 1308, 284 Cal Rptr 41 (husband charged with amount of salary paid to his girlfriend from company business, gifts made to alma mater, and purchase of Porsche when a company car was available for his use)]
(5). Funds removed immediately prior to filing a dissolution [See Williams v Williams (1971, 2d Dist) 14 Cal App 3d 560, 92 Cal Rptr 385 (husband charged with funds removed immediately prior to filing for dissolution of marriage to extent that funds could not be accounted for as community property expenditures)]
(6). Use of community property for separate property purposes [See Re Marriage of Walter (1976, 1st Dist) 57 Cal App 3d 802, 129 Cal Rptr 351 (husband charged with amount of community funds expended for payment of mortgage and taxes on his separate property)].
While an intentional misappropriation of community property can result in an unequal division of the remaining community property, mere negligence is not sufficient. Cases that have not found deliberate misappropriation include:
(1). Judgment entered as a result of negligence [See Re Marriage of Schultz (1980, 2nd Dist) 105 Cal App 3d 846, 164 Cal Rptr 653 (default judgment entered as result of husband’s negligent failure to notify court of new mailing address, held not sufficient to be deliberate misappropriation)]
(2). Negligent delay in paying taxes [See In re Marriage of Partridge (1990, 3rd Dist) 226 Cal App 3d 120, 276 Cal Rptr 8 (wife failed to meet burden of showing that husband’s failure to file taxes was deliberate)]
Even though a course of conduct may not rise to the level of deliberate misappropriation, a spouse may have a claim against the other spouse for breach of fiduciary obligation pursuant to Fam C §1101.
(3). Use of community property to purchase alcoholic beverages [See Re Marriage of Moore (1980) 28 Cal 3d 366, 168 Cal Rptr 662, 618 P2d 208 (wife’s claim that husband disposed of community property to buy alcoholic beverages did not constitute deliberate misappropriation of property; husband could not have purchased alcoholic beverages with the items if he had not received valuable consideration)]
The Moore case does not answer the question as to whether or not the same result would have been reached had the husband purchased illegal drugs with the community property, nor does there appear to be an appellate case on point.
(4). Resignation from employment. [cf. Marriage of Foster (1986, 4th Dist) 180 Cal App 3d 1068, 227 Cal Rptr 446 (husband resigned from Fleet Reserve following 24 years active duty in Navy, and judgment of dissolution awarded wife 43 percent interest in husband’s retirement benefits, but husband’s resignation from the Fleet Reserve resulted in forfeiture of all benefits; held permissible and husband not charged with receipt of community property share of military retirement benefits)].
IAAL
[Edited by I AM ALWAYS LIABLE on 04-01-2001 at 04:40 PM]
