The California Supreme Court's recent ruling on a legendary singer's divorce case highlights the state's community property laws and could impact future divorce cases. The California Supreme Court ruled in favor of Frankie Valli, saying that he still owns half of a life insurance policy purchased during his marriage.
California is a community property state, which means that spouses share anything that was purchased during the marriage if it was paid out of a joint bank account. The state Supreme Court ruled that purchases from a joint bank account are considered community property unless there is a written agreement stating that one spouse will give up ownership. Small personal items are excluded from being considered community property in a marriage.
The justices heard the case involving Frankie Valli and his ex-wife, who were fighting over the rights to a life insurance policy. Valli purchased the policy while they were married and put it in his wife's name. The policy also named the wife as the sole beneficiary.
The justices ruled that the life insurance policy was community property and since no written agreement was made, both parties owned part of the policy. Frankie Valli can take ownership of the policy by paying his ex half of the value of the life insurance policy, which is $182,500.
This case helps explain the state's community property law and is an example of the legal disputes divorcing couples may run into when they are trying to divide assets. Couples getting divorced should be aware of this ruling and make sure they understand which assets are considered marital property before going into divorce negotiations.
Source: SF Gate, "Frankie Valli wins divorce case in California Supreme Court," Bob Egelko, May 16, 2014