That Porsche You Gave Your Spouse Is Not Separate Property

California has a statute, Family Code 852(c), that provides that gifts that are tangible articles of a personal nature and not of substantial value become the separate property of the recipient spouse.  The consequence at divorce is that the gifted piece of property does not get divided under the usual community property presumptions.  But what do tangible, personal, and substantial mean?  We know clothes and some jewelry come within the gift exception.  But what else?  According to a recent court opinion a Porsche, while tangible and substantial, is not personal and thus not separate property.

Generally under California's community property system, any property acquired during marriage is presumed to be community property, and each spouse has an undivided one-half interest in that property.  If the asset is of substantial value one spouse can only consider the property to be his or her separate property if the other spouse signed a writing acknowledging the separate characterization. In Buie v. Neighbors the Court of Appeal has shed some light on the substantial value test.  "An automobile does not fall within the exception set forth in section 852(c) because it is not a tangible article of a personal nature, emphasis being placed on "personal."  Boiling it down, because one spouse cannot typically have exclusive use of the family car, it will not be considered a gift.

So there you go.  Now only seven billion more things to be adjudged "tangible articles of a personal nature not substantial in value."  My solution?  Get rid of the separate property exception altogether.

Please click here to read the Court's opinion.

Please be sure to visit www.hardinglaw.com, the website for the law firm of Harding & Associates, for more information on California family law.

Comments

[hayes legal]

Yes this is certainly an endlessly blurry line isn't it? This is a matter where there are no hard lines to draw or ways to escape personal opinion.

Anything acquired during the marriage really wouldn't have lineage value, and thus should probably be considered community property.