Property 101

The following is an article courtesy of Raj Bains, from his book How to File for Divorce in Washington.

In a dissolution proceeding, all property, community and separate, is before the court for a just and equitable disposition. By statute, Washington courts must look to certain nonexclusive factors in arriving at such a just and equitable disposition. Those factors are as follows:

1. Nature and extent of the community property;
2. Nature and extent of the separate property;
3. Duration of marriage; and
4. Economic circumstances of each spouse at the time of division. This factor includes assessing the desirability of awarding a family home to the party with whom the children shall reside the majority of the time.

What does all of this mean? It means that careful consideration must be given to all of the property of each of the spouses.

In completing the dissolution forms, you will have to divide debts and property owned by you and your spouse. Generally speaking, property and debts are divided fairly. Sometimes, the division is not exactly equal because of other factors, such as a higher future earning power of one spouse, or because one spouse may have devoted time to raising a child instead of pursuing a career. After reading through this section on property, you will not be an expert on legal issues concerning property matters. However, you should gain some basic insight to better equip you to deal with simple property division for purposes of settlement with your spouse. Many property settlement issues can be complex and it can be quite helpful to consult with a lawyer if you feel you are in over your head.

Defining Community Property

Community property is property which is equally owned in undivided one-half interests by a husband and wife by reason of their marriage. Generally speaking, community property is:

1. All assets acquired during marriage (excluding personal injury damages to a spouse).
2. All assets which the spouses agree to be community property; and
3. All assets which are converted into community property due to commingling (it is helpful to think of the concept of commingling as mixing up your separate money with another asset to the point where identification of your separate interests is not possible).

You should distinguish community property from the separate property of the spouses, and from other types of property ownerships such as tenancy in common and joint tenancy by right of survivorship, all of which have different concepts.

The policy of property laws in Washington is in favor of community property. This policy is implemented through the strong presumption in favor of community property. That means, it is presumed that all assets acquired after marriage are community property. The presumption is not absolute and may be overcome if there is satisfactory proof such as any of the following:

1. By proof that the asset was acquired by the use of the separate funds and/or the separate credit of the acquiring spouse
2. That the asset was received by a spouse after marriage by gift
3. That the asset was acquired by a spouse after marriage by inheritance
4. That the asset was acquired from the rents, issues and profits of separate property
5. That the spouses agreed in a legally satisfactory manner that the asset would be separate property
6. That the asset is personal injury damages

The presumption in favor of community property is a form of evidence. It must be satisfactorily rebutted (disproven) or it will control. If you and your spouse cannot resolve how to characterize a particular piece of property, as community or separate, you may want to seek professional legal help.

Defining Separate Property

Generally speaking, separate property consists of:

1. All of the assets a spouse owned before marriage.
2. The assets received by a spouse after marriage by gift or inheritance.
3. Damages for personal injuries suffered by a spouse.
4. An asset which the spouses agree to be separate property.
5. The earnings and accumulations of a spouse when living separate and apart.
6. The proceeds from one of the above, which is often referred to as the rents, issues and proceeds of separate property.