Are You Liable For Your Spouse’s Debts In California?

“Everyone knows” that California’s community property law makes you liable for spouse’s debts.

Only, “everyone” is wrong.

Or, more accurately, they’re only half right.

Community property is liable for everything

In California, the community property is liable for the debts of either spouse.

In fact, the community property is liable for the debts that either spouse brings to the marriage as well as the debts incurred during marriage.

But while the community property may be liable for your spouse’s debts, you personally aren’t liable if you didn’t incur the debt.

So, your spouse’s creditor can’t reach your separate property.  Nor can that creditor take property you acquire after the marriage ends for your former spouse’s debts.

But during marriage, that creditor can reach your community property wages.

Once the marriage ends,   your spouse’s debts don’t follow you after the marriage unless the judgment of dissolution awards a debt to you.

Creation of community property

So, where does community property come from?

Property acquired during marriage is presumed to be community property.

Presumed, but doesn’t have to be.

You aren’t bound to have community property.  Spouses can agree that they won’t have community property. Or they can agree that only certain property will be community and the balance will be the separate property of the spouses.

To be enforceable at law, the agreement needs to be in writing and both spouses should be separately represented by counsel.

Who is liable for marital debts

When you think about community property, consider that marriage really involves three entities.  Two of those are the spouses.  The third is the community property.

It’s  a menage a trois, sanctioned by the law<g>.

Each spouse is personally liable for the debts that spouse incurs.  That personal liability is independent of the marriage: it follows the person.

The community, as long as it has property, is liable for the debts of both spouses, incurred before and during marriage.

If/when the community is no more, each spouse is liable for their own debts, which may include debts assigned to them in a dissolution.  The community is divided and ceases to exist.

Researching law on the internet

This describes California community property law.  The law may not be exactly the same even in other community property states.

That’s why lawyers are licenced in each state.  The law differs, state to state.

So take care about  “researching” your legal questions on the internet.  Unless you know which state’s law is under discussion, and what the qualifications of the writer are,  your research may be not only useless, but dangerous.

More

Community property basics

Just who is liable during and after marriage

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