Recent Posts in Physical Separation Category

Q.  I have been occupying our family home alone since my wife left over a year ago.  I pay all the interest only mortgage, property taxes, and insurance with no help from her.  Does she owe me half of any of this?

A.  You may be owed you something, but not necessarily one-half of what you have paid out, and different categories of expenses may be treated differently.

This situation involves at least three potential legal concepts:

    * Epstein Credits (Payment of CP Debts Reimbursed)
    * Watts Credits (Reimbursement for Exclusive Use of CP)
    * Jeffries Credits (Combination of Epstein and Watts Reimbursements)

Epstein Credits

"Epstein credits" is a doctrine that holds that as a general rule courts must reimburse one spouse who uses earnings or other separate funds after separation to pay pre-existing community estate obligations.  Courts may not order this reimbursement if under the circumstances it would be unreasonable for the paying spouse to have expected reimbursement.  Where payments are made on account of a debt for an asset that the paying spouse was or is using and the amount was not substantially in excess of the value of the use, the Court may decline to order reimbursement.  This Blog addresses your question in terms of Watts and Jeffries credits that may be owing you upon divorce or legal separation - the prior blog details Epstein credits.  

Watts and Jeffries Credits

We speak in terms of "Watts credits" when one party has the exclusive beneficial use of community property.  When money is owed on that asset, "Jeffries" reimbursements or set-offs for the payment of that debt also come into play. On the one hand you are enjoying the use of a valuable jointly owned asset and should reimburse the community for that use; on the other you are paying something to a creditor for that use, and that amount should be deducted from what you owe the community.  Watts is a calculation for the value of what should be charged for an exclusive enjoyment of community property by one spouse; Jeffries combines the value of that use with reimbursements under an Epstein analysis.  Marriage of Watts (1985) 171 Cal.App.3d 366, 373-374; Marriage of Jeffries (1991) 228 Cal.App. 3d 548, 552-553. 

Family lawyers most often see Watts and Jeffries issues arise in disputes over residences occupied by one spouse alone.  In practice none of these concepts are typically applied to automobiles, although in theory they should be, or other consumer goods.  

While Epstein credits are generally viewed by trial judges to be mandatory reimbursements, allowing Watts and Jeffries credits is discretionary.  Having a working knowledge of your local judicial bench officer's attitude on these subjects is an important bit of information for you to obtain.

Watts credits and Jeffries credits are obviously implicated in your question since you occupy the house for which you seek mortgate and other payment credits and reimbursements. 

This is how Watts Credit issues typically arise - you and  your wife jointly own a home, and both of you are obligated on the mortgage.  Assume the monthly mortgage payment is $3,200 (interest only in your case), the taxes average $400/month, and insurance costs $1,200/year.  Mortgage payments are made on the 15th of the month, and she moves out on January 14, 2009.  You were unable to make the payment on December 15, 2008, so there are two payments due on January 15.  On January 15 you make these two payments, and then continue to make all these payments until the present time or the date of settlement or trial.  You occupy the residence the entire time.  You also incur charges for water for the landscaping, etc., along with the cable bill, electricity, phone and trash.  You have a gardner and a poolman that together amount to $250/month.

Hence, you are spending $3,700 on the mortgage, taxes, and insurance plus the $250 for upkeep, along with whatever you pay for utilities each month.  Over time this amount can grow to a considerable number. 

Assume you had to borrow the money to pay December late from your mother.  This is your separate property debt to Mom if borrowed after separation.  But because your wife lived at the house up until the day she moved which include all of January, you are entitled to the equivalent of an Epstein reimbursement.  Watts and Jeffries don't yet apply.  The obligation existed before separation, was paid after separation, and the source of payment was your separate property.  The community estate owed the payment, which means you owed one-half too (she also owes one-half the utilities charged during the same period as well that were paid with your separate property).

Watts and Jeffries credits answer questions how to deal with expenses you paid after she left where you had use of the home during some some of or the entire period.  Watts credits deal with the value of that use, and Jeffries deal with the value of the use less a reimbursement claim for the cost to you of that use.  Both parties can have these claims for the same property at different times, or one party may assert these reimbursements as against one property while the other may assert them as to another. 

What if instead of you living in the home after separation, it was rented to others but the rent didn't cover all the house related debt service?  The rents are deducted from the total and you each owe one-half of the shortfall.  If you advanced the difference, you are entitled to one-half back from your wife.

Watts' Analysis

So, where one party enjoys exclusive use of a CP asset how is the reimbursement calculated?

As a pure Watts credit analysis, assume a community property house is free and clear other than upkeep and utilities and that you lived there for a time - effectively rent free since there is no mortgage.  You can imagine how it might be unfair for you to receive this benefit without paying for it.  The amount of reimbursement you owe the community depends upon the property's fair rental value.  Fair rental value (FRV) is what you would expect to pay monthly to rent the same or a similar property on the open market in an arm's length tranactions.  It is usually proven by expert broker or appraiser testimony, but as an owner of property you are free to testify to what you think its fair rental value is (as is the other spouse).  Whether your opinion is believed or given weight by the court depends upon the assumptions you make in arriving at your opinion of FRV (as well as perceived credibility).  

If the FRV is $3,000/month, and you reside in the house for 15 months from date of separation to time of trial, the total value of your use is $45,000.  From this you would deduct fixed expenses like taxes ($400/month) and insurance ($100/month).  You would therefore owe the community $2,500 x 15 = $37,500, but since you own half the community the net reimbursement to the other party is one-half that amount.  You may also be able to deduct the gardner and poolman particularly where those payments help to maintain the asset itself.  You might even deduct repairs depending upon the circumstances (installing a solid gold toilet wouldn't qualify). 

All of these reimbursements are "Watts charges" to you.  They are "Watts credits" to the party to be reimbursed. 

Jeffries' Analysis

The more commmon situation is that some mortgage debt for the house you occupy is being paid monthly.  Assume it to be $2,000 combined (including mortgage, taxes, and insurance).  If the FRV is $3,000/month but you pay $2,000 monthly then the net benefit to you is $1,000 each month or $15,000 total.  You would owe a Watts reimbursement of one-half that sum, or $7,500, on the marital balance sheet or as a direct payment to your spouse.

This is a Jeffries situation.  Note that it assumes that these costs to you were paid by your separate property.  If instead you used community monies remaining in a bank account after the DOS to pay this debt (or CP funds from some other source) then you do not subtract that from the fair rental value because the community estate has already been charged.  
 
BTW, an interesting twist on this question these days involves what happens when there is a mortgage but the party in possession fails or refuses to pay it.  They are living there at no effective charge while the other spouse may be actually paying rent elsewhere.  In that case you should not receive a credit for one-half the debt you did not actually pay, but it is difficult to predict how a judge will handle this.  After all, you may continue to owe the money and have to repay it later.  Now what happens if you then decide to file a bankruptcy, so then never have to pay it because the debt is discharged?  That bankruptcy if properly drafted should also destroy any reimbursement claims of your spouse altogether.  Great unfairness can occur in these situations.  In my experience many of the legal rules for these reimbursement claims developed in a completely different economy and fairness and common sense is struggling to keep up with the new world order.

These days with the mortgage and real estate bust another situation frequently arises:  The amount a spouse pays to maintain the mortgage and related asset expenses may exceed the FRV of the property.  Should the other spouse be charged with half of this net loss, and so forced to underwrite some of it?

Assume in the illustration above that the costs remain the same, but the mortgage is $4,000/month.  Since FRV is $3,000, you are overpaying by $1,000.  Are you entitled to a credit back for one-half of the net loss?  In my experience most courts won't give it to you but make the argument anyway.  Courts seem to feel that if you choose to live in a place that you want the other side to help underwrite, when cheaper alternate arrangements are available, then your choice to stay there should not bind the other person.  The court cannot tell you what choices to make, but it can refuse to let you benefit unfairly by them.

This makes sense on at least one level - imagine that you have a large, beautiful, expensive home that is way under water, and that your estranged wife insists on continuing to live in it despite the fact that the costs to keep it are far in excess of what comparable lodgings would cost.  Naturally she wants you to absorb as much of this to whatever extent possible which lowers her incentive to move.  If she was allowed to stay and charge you for one-half the difference between a $10,000 mortgage and its $5,000 rental value, she might continue to reside in this losing, nonproductive asset if she effectively only paid $7,500/month after credit for your $2,500.

Conclusion

While Epstein reimbursements appear to be mandatory in dividing the community assets and liabilities, Watts and Jeffries credits are viewed as discretionary reimbursements.  Many judges don't favor these reimbursements and so exercise their disrection to deny them.  I tell my clients not to count on them in negotiating settlements, and many lawyers refuse to take the argument seriously when negotiating settlement.  Another reason why lawyers tend to treat them as inconsequential, besides bluffiing, is that they can be expensive to prove and so you are being tested as to whether you have the stamina or the money to assert these claims at trial.  After all, it is best to have forensic experts testify to them, and these individuals may include an accountant and a broker/appraiser.

One solution is to request the family court to bifurcate the issue so that a short, separate trial occurs on the Watts/Jeffries issues alone.  Once the amount of Watts or Jeffries credits is fixed by judicial decision you can now place it on the marital balance sheet in your settlement discussions on the remaining issues.

The success of a Watts or Jeffries claim are fact specific.  In doing justice and equally dividing the community estate, there is broad spectrum of fairness running from "its not big deal" to being "really unfair."  You will not get much traction where the consequence of not reimbursing Watts credits or imposing Watts charges is a small number.  But where one party enjoys the asset alone without paying creditors, a very strong argument exists in favor of finding reimbursements.

Finally, be sure to include reference to Esptein reimbursements and Watts and Jeffries in your Declarations of Disclosure to make it clear that you are asserting such a claim.  If you are the spouse in possession omit any reference to it.  It is not your job to assert that argument against yourself.

Thurman W. Arnold III
September 25, 2010
All Rights Reserved.

• Epstein Credits
• Watts Credits
• Jeffries Credits

This particular Blog addresses your question in terms of Epsteins - the next blog deals specificially with Watts and Jeffries credits. 

Epstein Credits

I have described Epstein Reimbursements in another Blog.  "Epstein credits" is a doctrine derived from the case of Marriage of Epstein (1979) 24 Cal.3d 76, 84-85.  It holds that as a general rule, courts must reimburse one spouse out of the community property who uses earnings or other separate funds after separation to pay pre-existing community obligations.  This commonly occurs with credit cards where there was a balance remaining when the parties separated that one or the other pays after that date.  Epsteins only apply to payments on the portion of a debt that existed at date of separation, and not new debt on an old card that was incurred afterwards.  The rule is not limited to credit cards but can apply to almost any class of debts.

Courts are required not to order this reimbursement if under the circumstances it would be unreasonable for the paying spouse to have expected reimbursement.  If there was an agreement that a party would not be reimbursed, if the paying spouse intended the payment as a gift, or when the payment is made on account of a debt for an asset that the paying spouse was or is using and the amount was not substantially in excess of the value of the use, the Court may decline to order reimbursement.  This idea of the value of use of some property acquired through debt that continues to exist after separation underlies the concepts of Watts credits and Jeffries credits, and is obviously implicated in your question since you occupy the house for which you seek credits and reimbursements.

So, Epsteins are almost always granted as to post-separation payments for expenses, or goods and services, that didn't leave a tangible asset behind that is now being exclusively enjoyed by only one of the two spouses. 

As an example of how this works if there is $15,000 owing Visa for that trip to Hawaii, some groceries, and a child's school tuition at the time of separation and one party pays it off or makes monthly installments on the debt with their earnings or other separate property after that date, a benefit has been conferred upon the community because a joint obligation has been extinguished or reduced.  That benefit must be equalized by a payment to the payor of one-half the amount paid or a credit or set-off against other property that gets divided.  One-half is paid because the paying spouse owed their half anyway.  Any portion paid before the DOS (date of separation) ordinarily will not be reimbursed. 

This is generally true even if only one of the parties actually took the trip to Hawaii, unless that trip was in breach of a marital or fiduciary duty (if the husband snuck off with his paramour to Hawaii, an argument exists that he should not be reimbursed for paying that portion of the debt over the wife's objection).  Family Code section 2625 directs courts to award a debt incurred by one spouse to them alone if debt was not "incurred for the benefit of the community."  Family Code section 2602 empowers courts to "award ... the amount the court determines to have been deliberately misappropriated by the party to the exclusion of the interest to any other party in the community estate."  FC section 2625 is a powerful and much underused statute (many attorneys seem to be unaware of it or try to bluff as though it didn't exist).

Compare this with a situation where a credit card was used to buy a dishwasher that the paying spouse possesses or receives in the divorce - since they are retaining a tangible asset it may not be fair to allow them to both keep the asset and get reimbursed for one-half its costs.  Applying Epsteins can become fairly fact specific.

In situations involving use of a family residence or other tangible assets that continue to exist after separation and which are used and enjoyed by only one of the spouses, an Epstein analysis provides only a part of the answer to the reimbursement question.  In effect first the amount of the Epstein reimbursements are determined, and then the question requires a Watts analysis to determine under equitable principles whether it is fair to actually order reimbursement and, if so, in what amount.

Hence, to resolve your issue you would begin by adding up the costs of everything related to the house that is spent to preserve or protect the asset.  Property taxes are included, but utilities are not.  The utilities you used after the physical separation are your obligation anyway, because they were not incurred during 'the marriage.'  (Please see the Blog Category "Physical Separation.")  Mortgage payments and insurance are considered, and probably the poolman or gardner as well.

Please continue on to the next blog for detailed infomation concerning Watts credits.

Epstein Credits and Fiduciary Duty Issues

Sometimes a spouse or domestic partner will raid the credit cards and take cash advances or buy a new wardrobe, or fix a car, during the weeks prior to separating.  If it later appears that their intention was to stick the other spouse for one-half of this expense, the presumption that this is a community debt (because incurred during marriage) may be overcome and so it may be assigned to the one spouse alone.  It is not fair to hold both parties responsible for debts incurred in anticipation of separation.

However, when one partner incurs a debt frivolously as opposed to recklessly before separation, in a situation not amounting to a breach of fiduciary duty - even over the prior objection of the other spouse - it is likely to be equally divided and Epstein reimbursements ordered.  Both spouses have, under California law, equal rights of management and control of the community property and community credit.

Courts in my experience are reluctant to find breaches of fiduciary duty in Esptein situations unless the behavior was fairly eggregious.  Charging 10 pairs of shoes at Macy's a month before separation may not be viewed as a big deal.  If the debt was incurred in pursuit of an illegal activity like supporting a drug habit or sex addiction, many judges are less reluctant to declare a breach. 

To illustrate another twist, if the credit card was used to pay the spouse's tuition expense instead a child's schooling as in my example above, it may also be unfair to charge the non-schooled parent with one-half the tuition portion of the credit card balance.  A court is likely to look at whether this schooling benefited the community in some way before splitting that debt betwen the parties - i.e., because of the schooling did the student spouse earn more money which was then contributed to the community standard of living and so confer a benefit on both?  Pure student loans are usually awarded to the party who incurred the debt as their separate property obligation. 

California Family Law Disclosure Forms

Whether you are representing yourself in your divorce, or a pro per family law litigant, you need to know about and understand the Declarations of Disclosure that are required in California before a Judgment of Dissolution may be entered.   Getting it wrong can have serious consequences.   In my experience, paralegal firms or non-lawyer mediators do not know how to properly assist clients in meeting these obligations, and even seasoned divorce attorneys get these disclosure forms wrong.   You need to understand that these disclosure forms are not simply another document that needs to be prepared in a sloppy fashion in order to complete your divorce, but rather they are the proof that you have complied with important spousal fiduciary duties after your physical separation.   

You can’t get even a default divorce and marital termination agreement past the family court clerk without a least a Preliminary Declaration of Disclosure (PDD) and when the other side has appeared in the action, you cannot obtain a Divorce Judgment without both parties have exchanged for waived the Final Declaration of Disclosure (FDD).   Even if the documents have been exchanged, if they are incomplete or inaccurate the other party may be able to set all or parts of your divorce judgment or divorce settlement for up to several years after a judgment is filed.   These rules and requirements apply equally to domestic partnerships, annulments, and legal separations.

This article covers the Preliminary Declaration of Disclosure.

California Family Code sections 2100 to 2113 cover declarations of disclosure for California divorces.  FC section 2100(a) declares it is the policy of the State of California to “(1) marshal, preserve, and protect community, and quasi-community assets and liabilities that exist at the date of separation so as to avoid dissipation of the community estate before distribution, (2) to ensure fair and sufficient child and spousal support awards, and (3) to achieve a division of community and quasi-community assets and liabilities on the dissolution or nullity of marriage or legal separation of the parties as provided by California law.”

FC section 2100(c) states that in order to promote this policy “a full and accurate disclosure of all assets and liabilities in which one or both parties have or may have an interest must be made in the early stages of a proceeding for dissolution of marriage or legal separation of the parties, regardless of the characterization as community or separate, together with a disclosure of all income and expenses of the parties.”

This bears emphasis:

• There must be a full disclosure
• It must be accurate
• It includes all assets
• It includes all liabilities
• It applies to assets or liabilities one has or may have
• The disclosure must be made early on in the proceedings, although there is no specific time rule
• It doesn’t matter whether you think the asset or debt is a separate property item, you still must disclose
• You must also fully and accurately disclose all income and expenses
• Although the statute doesn’t say it, you may see why these are forms that you do not want to lose – since, as mentioned below, the disclosures themselves are not filed with the court.

FC section 2100(c) does not, however, stop there.   The statute continues “Moreover, each party has a continuing duty to immediately, fully, and accurately update and augment that disclosure to the extent that there have been any material changes so that at the time the parties enter into an agreement for the resolution of any of these issues, or at the time of trial on these issues, each party will have a full and complete knowledge of the underlying facts.”

Family Code section 2102 sets forth the rules governing interspousal fiduciary duties, including the operation and management of community or part community businesses.   I will discuss this section elsewhere and link back to it when that article is finished.

Family Code section 2104 describes the Preliminary declaration of disclosure.   It must be completed as set forth in this Judicial Council Form.   It does not get filed with the Court, but a declaration stating it has been exchanged must be filed with the Court.  

If, as commonly occurs where parties have negotiated and signed an agreement and the Dissolution Judgment proceeds by default with a Marital Settlement Agreement signed by both being submitted, no final disclosure needs to be exchanged between the parties but the Petitioner still must himself or herself complete and serve the Preliminary declaration; the defaulting Respondent is relieved of that obligation.

Family Code sections 2120 to 2129 describe when a judgment for dissolution, or a property settlement or a support settlement, may be set aside for defects in the Preliminary declaration of disclosure and for other reasons.  

You can find the actual California Judicial Council forms here.

Again, I will write an article about that and link back once it is completed so please check back with us.

Q.   What is meant by separation in California?

Q.  My wife and I separated in June 2009. When we purchased our home in March of 1998 (married December 1994), she used part of an inheritance from her grandmother to help with the down payment. I have been paying the mortgage since we bought it. Will she get her inheritance back in our divorce? What would I get?

Q.  My Husband is receiving a large settlement for an auto accident he was in.  If we divorce, am I entitled to 1/2 of the settlement?

(a) "Community estate personal injury damages" as used in this section means all money or other property received or to be received by a person in satisfaction of a judgment for damages for the person's personal injuries or pursuant to an agreement for the settlement or compromise of a claim for the damages, if the cause of action for the damages arose during the marriage but is not separate property as described in Section 781, unless the money or other property has been commingled with other assets of the community estate.

(b) Community estate personal injury damages shall be assigned to the party who suffered the injuries unless the court, after taking into account the economic condition and needs of each party, the time that has elapsed since the recovery of the damages or the accrual of the cause of action, and all other facts of the case, determines that the interests of justice require another disposition. In such a case, the community estate personal injury damages shall be assigned to the respective parties in such proportions as the court determines to be just, except that at least one-half of the damages shall be assigned to the party who suffered the injuries.

Q.  What rights do I have to permanent spousal support?

A.  Permanent spousal support is not usually "permanent," although it can be in cases of very long marriages.  Lawyers and judges also refer to it as post-judgment spousal support, alimony, judgment spousal support, or long term support.

Unlike temporary spousal support, long term spousal support is only issued after a final judgment of Dissolution of Marriage or Legal Separation.  It is equally available to domestic partners.  Also unlike temporary support, it is not based on any computer formula or state or county guideline, but must be determined and fixed depending on the facts of every individual case.  If long term support is important to your future wellbeing, you are going to need an experienced support attorney.

There are several very important rules to keep in mind.  First, a marriage in California which lasts more than 10 years (defined as the time between date of marriage and physical separation), is "long term" marriage.  The general rule is that in marriages which are not long term, spousal support should not be payable for more than one-half the length of marriage - or to put in differently, the law presumes that the recipient spouse should be rehabilitated and so become self-supporting in a period equal to 1/2 the marriage.  However, this presumption becomes less important in cases involving older couples, especially where people can not be realistically expected to re-enter the work force, in cases where there children who remain minors, or where the party asking for support has a debilitating disease or disability.

There is no magic ratio for how long a former spouse might be ordered to pay long term support.  Each case depends upon its own facts, the quality of your attorney, and the attitudes of the family court judge.  Even in cases of long term marriages, the support obligation typically will end at some point in time.  However, if usually will not end on its own - meaning that when a trial court orders long term support it will reserve jurisdiction to continue to extent it, until some time when a party petitions the court to terminate support and a judge finally says "enough is a enough." 

Imputed income is often an important argument in long term support marriages, where one party convinces the court that the other party is shirking or failing to genuinely try to become self-supporting.  It is sometimes necessary to have the supported spouse evaluated by a vocational rehabilitation expert. 

There are four components to an award of of permanent support:  1) Amount; 2) duration; 3) substantive increases or decreases over time; and 4) jurisdictional step downs and ultimately a termination date.

Second, Family Code section 4320 is a critical support statute.  I have provided a link and uploaded it so that you may read it.  Essentially it sets forth all the factors that the court must consider in setting post-judgment support, and you will see that it is not an exhaustive list and the court can consider anything else it deems important to the decision.  Support factors include the extent to which the earning capacity of each party is sufficient to maintain the marital standard of living established during the marriage, considering:  a) the marketable skills of the supported party, the job market for those skills, the time and expense required to train that party including education and b) the extent to which the supported party's present or future income earning ability is impaired by periods of unemployment or were incurred during the marriage to permit that party to devote time to domestic duties.

Another factor is whether the supported party contributed to the attainment of an education, training, license, career, or position by the supporting party. 

Another factor is the ability of the supporting party to pay, taking in account that person's earning capacity, income, and assets and standard of living.

Another very important support consideration is the needs of each party - including both. 

Another factor is the obligations and assets of each spouse, including the separate property which each has or gained upon the dissolution.

Another is the ability of the supported spouse to engage in gainful employment without interfering with the needs of dependent children in their custody.

The age and health of the parties is critical in some cases.  65 years of age is the presumed retirement age for adults today, and courts cannot order a person to continue to be employed beyond that age - but, if they make that choice, their income can be considered.

A documented history of domestic violence can affect the right to receive support or the obligation to pay it.

The tax consequences between the parties must be considered.

And, basically, as I said, any other specific facts that trend one way or another.

The three most common factors are the marital standard of living (MSOL), need and ability to pay, and the assets the parties end up with upon divorcing.

Courts cannot order lump sums for support.  Spousal support is generally taxable to the recipient and deductible to the payor, but there are very specific IRS requirements that must be met for this to actually be so.

Courts are required to state their findings on each relevant issue in writing.  In practice though, most people settle their divorce cases by way of settlement agreements.  Unfortunately, lawyers often leave out these findings so that when a court is asked, down the road, by the payor to terminate or decrease support, or by the payee to increase it, there is no map for the court to use to base its modification findings on.

If support is an issue for you either way, please hire a competent lawyer.  There are many attorneys moving into family law from civil practices who are clueless about these things.  Caveat emptor!

Q.  How is temporary spousal support calculated in California?

A.  In order to be entitled to spousal support, parties must be married or be registered domestic partners.  Spousal support (which is not usually referred to as "alimony" in California) is available in dissolution proceedings, actions for legal separation, and in connection with domestic violence applications. 

Spousal support orders may be temporary, or they be what is called permanent.  Different rules apply to how temporary support is figured than to permanent or long-term support.  I address permanent spousal separately.

Temporary spousal support is designed to preserve the status quo pending a final judgment.  Family Code section 3600 provides that during the pendency for dissolution of marriage or legal separation or in any proceeding where there is at issue the support of a minor child, the court may order the husband or wife to pay any amount that is necessary for the support of the husband and wife (subject to limitations contained in FC section 4320 and FC section 4325).  Again, parties dissolving domestic partnerships may also be awarded support.

Temporary spousal support has nothing to do with the length of the marriage.  Courts look at what the spending pattern was pre-separation and issues a spousal support award based upon need.  If there isn't enough money on the basis of need, then an amount is ordered based upon the higher earner's ability to pay.  A party seeking spousal support isn't deprived on the right to receive support even if they have income - the question is the relative income circumstances of the two parties.

Most California counties have formulas that determine temporary spousal support, but the two most important are Santa Clara and Alameda counties.  Essentially the spousal support formula for Santa Clara County - which is the dominant one - is as follows:  From any amount which is not allocated to child support, take 40% from the net income of the payor spouse, less 50% from the net income of the recipient spouse.  The resulting number is the temporary spousal support.  You do not need to have children to be entitled to receive spousal support.

As a practical matter, courts typically use one of two computer programs that generate these numbers:  Either the Dissomaster or Xspouse.  The Indio courts use Xspouse and the Santa Clara guidelines.

Into one of these programs are inputted the respective gross incomes of the parties.  If there are children of the parties, the custodial timeshare in percentages is inputted (because only a party who has physical custody for more than 50% of the year can claim the tax benefits of HH/MLA or head of household status, the programs require one to be considered to have 51% even in true joint custody arrangements). 

Only certain expenses matter for purposes of temporary support in California.  What doesn't matter at all is most personal expenses (like mortgage payments, utilities, debt).  This effectively ignores the entire debt structure of the parties at time of separation.  Health insurance, union dues, and mandatory contributions to retirement (i.e., typically not IRA contributions), and obligations existing to other minor children living in one party's home, or as to which an actual court order requires they make support payments, are also entered.  The support program 'tax effects' these numbers and figures out the net incomes of the parties.  It renders a number that tells the Court how much the higher earning spouse must pay for purposes of a court order.

Since the court determines the support obligation some weeks after a request for support is made (by way of Motion for Order to Show Cause application), it typically makes the support order retroactive to the date of the filing for the request.  Most courts order support payable one-half on the first and fifteenth of the month.  For this reason, if you file for support on the 5th day of the month, the court will not make support retroactive to the 1st but will start of the obligation on the 15th day of the month.

This might sound like temporary spousal support is easy to fix and who needs a lawyer?  This is not at all the case.  The final support numbers depend upon how much income the Court is attributing to each party.  Each is required to submit before the hearing an FL-150 Income and Expense Declaration.

For instance:  A husband's (and wife's) income numbers are usually but not always based upon historical earnings, and the California judicial council form (FL-150) requires both to set forth there total gross for the past 12 months and also the past month.  The legal assumption is that historical earnings are a reliable guide to future earnings, but this may not be at all true.  Especially in today's economy, historical earnings may not be indicative of what the income stream will be going forward.  This information needs to be credibly presented to the Court.

In cases where one party is a self-employed spouse, their net pre-tax earnings must be determined after deducting business expenses.  This is a common and complex area of dispute, because what is deductible for purposes of Schedule C accompanying a tax return according to the federal government is in no way binding upon California courts for purposes of figuring support.  If somebody works from home and charges part of the mortgage expense as a business deduction, that expense may be added back into the income stream as being available for support.

Another support battleground often involves imputed income.  What if one party refuses to work, or insists on working at a lower paying job?  Perhaps a support recipient believes they will get more money from their spouse if they have no job but if they tried to get one, they could?  What if one party claims that they aren't working and that no jobs are available?  Imputing income cuts both ways, and is extremely sophisticated. I will address another blog to it.

Incidentally, while only temporary alimony is calculated in this way, child support is always figured in this manner regardless whether there is a spousal support obligation.