For many couples getting divorced in California, deciding how debts will be divided is just as important as determining how assets will be split. Are you liable for debts your spouse had when you got married? What about debts your spouse ran up without your knowledge or after you separated? The answers often depend on the specific circumstances, so it is important to work with an attorney who is willing to go through the details with you and who understands how to protect your rights effectively when it comes to marital debt under California law.

Debts from Before You Got Married

California’s community property laws are complex when it comes to debt. Property acquired during the marriage belongs to the community—to both spouses–even if earned or purchased by only one spouse. The community is liable for debts incurred during the marriage, as well as debts each spouse had before marriage under Section 910 of the California Family Code. However, in divorce, the obligation changes. At that point, all debts one spouse had before they got married are treated as their separate obligation under Section 2621 of the California Family Code. Property owned before marriage is also the separate property of each individual spouse. However, that property can become commingled with community property during the marriage, and then it can be challenging to determine which portion of the asset should be divided and which should be kept by the spouse who owned it originally. If a spouse opened a line of credit before the marriage but then continued to use the credit to buy things during the marriage, the debt for those items acquired during the marriage would be joint debt that must be allocated in the divorce settlement.

It Doesn’t Matter Who Signed the Bill

Married couples in California are jointly responsible for each other’s debts from during the marriage, even if only one spouse made the purchase. If during the marriage one spouse agreed to a five-year loan for a car that the other spouse didn’t want and never drove, both spouses would still be equally liable for the debt. However, if the debt involved improper behavior, such as buying jewelry or paying hotel bills associated with an extra-marital affair, it may be possible to have that debt allocated solely to the spouse who committed the wrongdoing. In addition, if a couple has more community debt than community property, the excess debt may be assigned to one spouse if the court finds that to be fair based on each spouse’s ability to pay and other factors.

Records are Vital

Because married couples are presumed to be jointly liable for any debts run up by either one of them during the marriage, it is vitally important to know what debts are out there. Spouses can try to hide debt in divorce just as they try to hide assets. It is important to check credit card statements, credit histories, and other records to determine what debts you may be liable for. If the debts were made fraudulently or in bad faith, it may be possible to have the court make your spouse solely liable for those debts.

Pay Attention to the Date of Separation

After the official date of separation, the debts each spouse incur will be their own separate obligation. This means you need to firmly establish the date of separation. Under Section 70 of the California Family Code, this is the date a “complete and final break in the marital relationship” occurred. Evidence of this break could be one spouse telling the other that they want a divorce or one spouse acting in a way that indicates they intend to end the marriage. Since the date of separation affects both property and debt allocation, if spouses can’t agree on the separation date, courts often have to consider evidence and make a ruling on the issue. There is one exception to this rule, and that involves expenses for “common necessaries of life” for either a spouse of their children. For those expenses, the court may order one spouse to pay the debts of the other based on each spouse’s needs and ability to pay.

Holstrom, Block & Parke, APLC Works to Ensure a Fair Allocation of Debt in Divorce

To rebuild your life after divorce, you need to emerge from the process on the best possible financial footing. At Holstrom, Block & Parke, APLC, our Certified Family Law Specialists and associates understand how to effectively protect your interests with respect to classifying debts as well as assets. With over 300 years of combined experience, our legal team can also help with practical advice for protecting yourself from your spouse’s creditors. We invite you to schedule a consultation to learn more about the ways we can assist in your divorce.