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Articles Posted in Community Property Asset

It should not be the point of a prenuptial agreement to avoid all financial responsibility to the other spouse.  As the family law code sections are abundantly clear about is that they do not want the spouse who is not on the receiving end of the prenuptial agreement and stands not to benefit at all from the prenuptial agreement that fairness is the key.  The family law Code is clear that is wants equity and fairness in the protection of marital assets.  Although a party can contract away their assets and debts through the prenuptial agreement it is vital to the integrity of the family law judicial system the one party does not blindside another less fortunate party and take off with all the loot.

California legislature has codified these prenuptial statutes under family code section 1612(c) and section 1615 that unconscionability and independent legal representation are a mandate to making an enforceable prenuptial agreement. One party cannot unduly take advantage of another party through one sided and lopsided contracts that give the other party nothing while the other party hauls away all the money.  If both parties and more importantly the party who has the assets to protect can enter the prenuptial setting with an open mind to make the contract fair and equitable that party will avoid unnecessary litigation down the road.  People, however, often enter these prenuptial agreements with a greedy mindset and try either to outsmart or blatantly take all the assets away from the other party.  This leads to an obvious disparity in the contractual agreement and creates a huge public policy concern.

That is the reason that an independent legal counsel is almost mandatory for the legitimacy of the prenuptial agreement to work.  Without the independent legal counsel for the party not receiving a financial gain at the outcome of the prenuptial agreement would create innumerable unconscionable agreements that would be too easy to enter into and create too many unequally bargained contracts.

The concept of proving goodwill in divorce proceeding seems rather complex and vague.  The idea that a business can be divided as community property is a relatively new idea that the courts have to deal with.  How to determine the valuation of a business requires alot of time and forensic accountants.  The arguments laid out by each party drive the Courts to have to decide what is separate property and what is community property.  A long term marriage makes this descision even more complicated. The complication lies in the evaluation of a community property asset that sometimes does not have a easy financial determination.  It may be even considered speculative to determine what is goodwill of a business.  Is it the receipts that come in monthly? minus the costs and expenses.  Or is it something more vague and uncertain that must be evaluated on a case by case basis?

To place more complication on the matter.  The goodwill might not all be community property but also separate property thus tracing property to its source will be another issue that must be determined by the court.  This often cannot be an easy task given the length of marriages and the commingling of separate property assets over a period of time while the couples are married. In addition the earnings of a business and the future receipts that will occur although speculative seem to be the only way to evaluate a business. However, Courts still will only use this future earning determination as a factor and not the only method to evaluate a business because of its uncertainty.

In addition, the Courts still cannot determine goodwill based on economic future earnings alone.  The Court must also consider such factors as the parties age, health, past proven earning power and professional reputation in the community.  And the Court must consider the personality traits of the professional involved. The Court must examine the professional judgment, skill and knowledge of their business which would be rather complicated and require expert witnesses to cooberate the actual veracity of the skills of the professional.   Once the expert witnesses are testifying the Court will continue its investigation into the professionals experience by comparing their skills to other professionals.  Also the Court will look at the nature and duration of his business so that they can determine whether goodwill even exists in the business.

Apollo 11 astronaut Buzz Aldrin has filed a California divorce petition in Los Angeles, seeking to end his marriage to Lois Cannon, according to MSNBC.

Aldrin, the second human to set foot on the moon, is 81. He and Cannon have been married for 23 years. The couple have no children, though Aldrin has three grown kids from his first marriage (Cannon is his third wife).

Though Aldrin was in the military when he was part of the space program in the 1960s, he has recently emerged as a pop culture figure beyond the world of space aficionados. The former astronaut has appeared on popular TV shows such as 30 Rock, Dancing with the Stars and WWE Raw Live, the website notes. He is also an author and has been involved in efforts to promote commercial spaceflight. All of this presumably makes for a marital estate far larger than that of most military retirees.

Diandra Douglas suffered another legal setback this month in her effort to claim a share of ex-husband Michael’s earnings from the film Wall Street 2: Money Never Sleeps. When last we left Diandra and the legal system, her attorneys were arguing before a New York court that Michael Douglas’ earnings from the sequel to his Oscar-winning performance in 1987’s Wall Street are subject to California’s community property laws, despite the couple having been divorced for more than a decade.

According to the celebrity-watching website Monsters and Critics, however, a Manhattan judge “rejected her request to overturn his original ruling (of) last year.” In doing so he reaffirmed his original opinion that if Diandra’s case is to be heard at all it should be in California, where the couple’s divorce was finalized back in 2000. The website quotes Diandra’s attorneys vowing to appeal the decision.

As I noted when originally discussing this case last year, Diandra’s claim does not amount to a demand for a California post-settlement modification. It turns instead on an essentially philosophical question: what, artistically speaking, is the relationship of a sequel to its original? The original Wall Street film was made during the Douglas’ marriage. Therefore, under California’s community property laws, Diandra is entitled to a piece of any ongoing income Michael makes from the film: residuals and royalties, for example.

Neve Campbell and her husband John Light finalized their California divorce earlier this month, according to celebrity-watching website Contactmusic.com.

The fact that the couple chose Los Angeles County as the venue for their split is noteworthy since neither of them is originally from the United States. Campbell is Canadian, though she has lived in Southern California for many years. Light is British, and is best known for his stage work in England. According to Contactmusic, the California divorce was finalized one day after the couple’s fourth wedding anniversary and 11 months after the original California divorce petition was filed in Los Angeles Superior Court.

The marriage was Campbell’s second. The couple have no children. Granted the international nature of their marriage (according to iMdb Campbell is a UK citizen via her marriage to Light) the choice of California as the venue for their divorce is interesting. The state’s community property laws, combined with the high concentration of celebrity-watching journalists in and around Los Angeles, have long led celebrity couples to seek out other venues when they can. Campbell and Light’s decision to go forward with their divorce here in Southern California reflects a degree of comfort with the California and US systems that many foreign couples o not necessarily share.

When last we left Frank and Jamie McCourt – a couple who, over the last 18 months, have engaged in what is arguably the biggest, bitterest and highest profile Southern California divorce in recent memory – Jamie had just won a major victory with a Los Angeles family law court’s ruling that a disputed post-nuptial agreement is valid and she, therefore, is a co-owner of the Dodgers.

That made last week’s headline in the Los Angeles Times a bit surprising: “Frank and Jamie McCourt working quietly on a settlement.” ‘Quiet,’ ‘settlement’ and ‘McCourt’ are words we are not accustomed to seeing together in the same sentence. The confluence of that headline and Opening Day made this seem like a good time for an update.

The Times report says attorneys for the couple sought and received postponement of a hearing scheduled to take place early next week regarding settlement issues. The hearing had been scheduled to consider Jamie’s demand “that Frank be ordered to provide her with extensive financial documentation regarding the Dodgers’ business operations.” The Times notes that media reports over the winter have indicated that Jamie is willing to cede her share of the team back to Frank in exchange for a payout “but she has balked at the proposals he has offered” so far. The postponement request, coming after about a month of renewed settlement talks, may indicate that the two sides are making progress.

The situation involving Elizabeth Edwards and John Edwards is not uncommon for couples in distress. Elizabeth and John are separated but they do not intend to file for divorce until someone decides to remarry. For most people, upon one person’s infdelity, it would make sense for the other party to want to cut all ties, divorce and move on with their life. Such is not the case for Elizabeth and John Edwards. Elizabeth states that the couple plan to sell their $5.5 million mansion in Chapel Hill, North Carolina because their “dream house” just does not have any meaning anymore.

In divorce proceedings here in Los Angeles County and Orange County, liquidation of a community property residence is normal. It’s one step towards resolving the property division aspect of the divorce. However, sometimes, if the couple have minor children, the parent raising the children usually wants to hold on to the house until the youngest child turns 18 so that the child can continue with their education in the environment they have grown familiar to. The less disruption for the child, the better the situation becomes. The Edwards’ still have two minor children together. So, it is unknown what the couple intends to do regarding whether they intend to send the two minor children to the same school and/or if they will continue to reside in the same area.

For more information on child custody, visitation or disposition of a community property asset, such as a home, contact and Orange County divorce lawyer for more information.

Actor Michael Douglas and his first wife Diandra finalized their Southern California divorce a decade ago, but she now insists their California family court settlement entitles her to half of his profits from a movie that hasn’t even been released yet. According to the New York Post, Diandra has filed suit in a New York court seeking half of the money Douglas will receive from “Wall Street 2”, a sequel to his 1987 Oscar-winner. The movie is scheduled to premier in September.

According to the celebrity website PopEater, Diandra’s claim is based on a clause in the couple’s California divorce settlement giving her half of the proceeds from work Douglas did during the couple’s marriage. Since Douglas plays the same character in the new movie that he did in the original, she is asserting that the forthcoming film fits the settlement’s definition of “residuals, merchandising and ancillary rights”.

According to the Post, Douglas’ lawyers have filed papers claiming that a “sequel” is not the same thing as a “spinoff”. Were the new film the latter, they say, she would have a case; but, they argue, it is the former – and that means she is not entitled to a cut. Douglas’ lawyers are also arguing that California family court is the proper venue for the suit since the couple were divorced in the state. Diandra’s attorneys say they filed in New York because that is where both of the ex-spouses now live.

Blogging about other people’s Southern California divorces is one thing, but your own? While it is still being adjudicated? Say what you will, author Justine Musk is taking an unusual approach to negotiating her Los Angeles County divorce settlement. The real negotiating is, of course, taking place behind closed doors involving Southern California divorce lawyers. Musk, however, has used her blog to lay down a marker about what she wants and to defend it in public. The case of Musk and her husband, billionaire investor Elon Musk, is especially interesting because, as Reuters reports, Justine’s demand for a stake in Elon’s latest venture – the Tesla electric car company – may complicate plans for the company to go public.

According to LA Observed the couple have been married eight years and have five children. Elon Musk is a co-founder of PayPal. Justine Musk is a successful novelist, specializing in supernatural thrillers. LA Observed, quoting her blog, says she is demanding a 10 percent stake in Tesla, as well as five percent of another Musk venture, Space X. She also wants $6 million in cash, the couple’s house, child support and alimony… and a Tesla Motors Roadster (retail price: $109,000).

Reuters reports that Justine Musk’s demand for a stake in Tesla Motors as part of her California divorce settlement “could complicate plans… to take the company public and retain $465 million in U.S. government funding to launch a mass-market electric car named Model S.” The news agency reports that lawyers for both spouses did not return calls seeking comment.

The Los Angeles Dodgers 2010 season got off to a rocky start yesterday with an 11-5 loss to the Pittsburgh Pirates (here in Orange County, the Anaheim Angels had a better opening Day – winning 6-3). As the players settle in for a long summer of baseball, however, uncertainty hangs over the team in the form of the California divorce proceedings of owner Frank McCourt and his wife Jamie.

News of the couple’s impending Southern California divorce broke just as the 2009 season was winding down, and has been an unfortunate feature of California baseball talk throughout the winter. As the players prepared for Opening Day, Los Angeles divorce court officials say a date has been set for the divorce trial. According to ABC News, the couple’s case is scheduled to be heard in a California divorce court beginning August 30. The network, quoting a court official, reports that the trial is expected to last 11 days.

According to the Associated Press, Jamie McCourt is seeking temporary spousal support of $1 million per month. Frank McCourt’s lawyers say he can’t afford that because much of his money is tied up in real estate (and, therefore, is relatively illiquid). They have reportedly offered Jamie $150,000 per month.

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