In re Marriage of Jafeman - 29 Cal. App. 3d 244, 105 Cal. Rptr. 483 (1972)

Rule:

All property owned by a husband prior to marriage, together with the rents, issues, and profits arising from the property after marriage, is his separate property. The character of the property is fixed as of the time it is acquired and it is not altered by the occurrence of marriage or by the subsequent use of the property in the marital relationship. However, a husband and wife may change the character of property from separate to community by an oral agreement. No particular formalities are required for an effective agreement. The agreement may be either express or implied. If the wife acquires possession of the property and manages and controls it, this does not in and of itself demonstrate that the husband intended to alter the character of his property. However, the nature of the transaction or the surrounding circumstances may establish the existence of such an intent on the part of the husband. The acts of the parties and their dealing with the property may also establish that they intended a community interest.

Facts:

In a dissolution of marriage action, the court found that a home acquired by the husband prior to his marriage was community property, based primarily on the fact that for 14 years community funds, managed and controlled by the wife, were used to make payments on the home and for improvements, implying an agreement by the husband that the home was to be community property. The court also found that a savings account in the wife's name, and the cash surrender value of her pension plan, were her separate property. The court entered an interlocutory judgment of dissolution and awarded the wife attorney's fees over the objection of the husband that such award violated the provision of the Family Law Act that the community property be divided equally. 

Issue:

Was there an implied agreement to change the character of the residence acquired by the husband prior to marriage into community property?

Answer:

No.

Conclusion:

The Court of Appeal reversed that portion of the interlocutory judgment awarding and dividing the community property, finding that there was no implied agreement to change the character of the residence acquired by the husband prior to marriage into community property, and directed the court to make findings on the issue of the wife's consent to the expenditure of community funds for the improvement of the entire residence and to take further evidence on the issue if necessary. The court also found that the savings account consisted of earnings of the wife acquired while she was living with her husband, and that it was therefore community property. The lower court was directed to determine the character of the wife's interest in the pension plan and to determine its value. The court rejected the husband's contention that an award of attorney's fees out of his share of the community property violated the requirements of the Family Law Act that community property be divided equally between the parties.