With Improvements Section
Your data input indicates that the property you wish to apportion is not real estate. The Moore Marsden formula was developed to apportion community property and separate property in real estate. It may be inappropriate to use the Moore Marsden formula for other types of property.
You indicated that the property in question was not purchased with a loan. The Moore Marsden formula assumes that the property being apportioned was purchased with a loan. Principal pay down on the mortgage becomes the basis for the apportionment. The real estate can still be apportioned between separate property and community property through community property contributions via improvements (see Marriage of Wolf (2001) 91 Cal.App.4th 962). We suggest speaking to a family law attorney and qualified forensic accountant familiar with California Family Law for additional information.
You indicated that the property you wish to apportion did not increase in value. The Moore Marsden formula is used to apportion appreciation between separate property and community property in a separate property piece of real estate. If no appreciation exists to apportion, it may be inappropriate to use the Moore Marsden formula. You should consider speaking to a family law attorney regarding reimbursements.
You indicated that the property you wish to apportion was acquired during the marriage. This is a departure from the fact pattern In re Marriage of Moore (1980) and In re Marriage of Marsden (1982). The presumption that the asset acquired during the marriage is community property [Family Code 760] can be rebutted [Family Code 770(a) and Family Code 2581]. The person who intends to purchase the asset as his or her separate property may also have certain fiduciary duties to the community and to his or her spouse [Family Code 752]. However, if the asset acquired during the marriage is characterized as the separate property of the purchaser, then the Moore Marsden formula might still be appropriate to use [see In re Marriage of Bonvino (2015)]. Right about now, you should really consider talking to a family law attorney.
You indicated that the property was improved. If you wish to use the value of improvements as a basis for apportionment, the Moore Marsden formula is silent on the issue of improvements. A separate line of cases empower the courts to apportion using improvements for the enhanced value to a property that the improvements create (see Marriage of Wolf (2001) 91 Cal.App.4th 962 and Marriage of Frick (1986) 181 Cal.App.3d 997).
You indicated that the property you wish to apportion was refinanced. There are issues regarding the character of the loan proceeds. Loan proceeds taken during the marriage are presumably community property (see Fam. Code §760; Ford v. Ford, 276 Cal. App. 2d 9, 80 Cal. Rptr. 435 (Ct. App. 1969)). If the lender is looking either to community property for security for the loan or to community earnings to repay the loan, then the court may find that the asset purchased with the loan proceeds are community property (see In re Marriage of Grinius). If the lender relies on a borrower's separate property for satisfaction of the debt, then the asset acquired with the borrowed funds is likely that spouse's separate property. (Ibid.)Because of the complex nature of refinances and their impact on characterization and apportionment, we cannot provide a computation related to your fact pattern through this form. Additional analysis should be done. Consider consulting a family law attorney and a forensic accountant familiar with California family law.
While it stands to reason that the principal reduction post separation should be used as part of the basis for apportionment, the original Moore Marsden formula did not consider the principal reduction post separation. You indicated that there are post separation payments made to reduce principal that you would like to use as part of the basis for apportionment. Thus the Moore Marsden formula should be modified to account for principal reduction payments post separation.
You indicated that title of the property changed during the marriage. There are characterization and transmutation implications that may come out of title changes (see California Evidence Code 662; Fam. Code §852; Fam. Code §760). These fact patterns can become very complicated and would require much more analysis than can be delivered on this form. Consider consulting a family law attorney and a forensic accountant familiar with California family law.
© 2023 Moore Marsden
Address: 27200 Tourney Rd #290 Valencia, CA 91355
contact@miod-cpa.com
(818) 898 9911
Calculate
Book A Consultation