In re Brace - 9 Cal. 5th 903, 266 Cal. Rptr. 3d 298, 470 P.3d 15 (2020)

Rule:

Evidence Code § 662 provides that the owner of the legal title to property is presumed to be the owner of the full beneficial title. The law does not reference the Family Code, nor does it explicitly characterize property as separate so as to provide an exception to Family Code section 760.

Facts:

A bankruptcy case was filed by Brace, but his wife did not join the case. The couple acquired properties with community funds and took title to each property as “husband and wife as joint tenants.” The bankruptcy trustee sought a declaration that the properties are community property under Family Code § 760, so the entirety of the husband’s interests in the properties becomes part of his bankruptcy estate. The bankruptcy court ruled that the properties were community property. The Ninth Circuit Bankruptcy Appellate Panel affirmed.

Issue:

Was the form of title presumption in Evidence Code § 662 applicable when it conflicted with the community property presumption in Family Code § 760?

Answer:

No.

Conclusion:

The form of title presumption in Evidence Code § 662 was held inapplicable when it conflicted with the community property presumption in Family Code § 760. To conclude that Evidence Code section 662 and not Family Code section 760 applies outside the context of divorce would run counter to the intent of the pivotal 1973 legislation that prospectively eliminated separate property inferences from form of title.