Filing chapter 7 for separated spouse
Posted: Mon Nov 19, 2012 8:19 pm
charset932
Thank you Pat. I saw the case as you did but my prior case caused a big problem. I argued the opposite in that there was no money taken out as property was only refinanced and they were only married for 14 months. We ended up negotiating with trustee and their attorney.
I just don't want that to happen again.
I believe it's best if I filed for wife and tell her that her husband should wait until the case is discharged.
Thank you again.
Nate Berneman
Sent from my iPhone: Nathan Berneman
On Nov 19, 2012, at 7:46 PM, "Patrick T. Green" wrote:
> Nate:
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> I consulted with my favorite certified family specialist. When I said M. of Branco, she said off the top of her head that it was an important marital property characterization case. She had to look at the case to refresh her memory on the rule of law, but she recognized it immediately. You may want to change horses next time you have a family law question.
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> The case involved a W who owned separate property. A loan was taken on the separate property with both spouses as obligors with the proceeds being used to pay child support obligations of H and marital debt. The appellate court said that all payments towards the loan created a pro tanto community property interest in the property in the property. Any increase in the value of the property post loan was shared between the community property and separate property interests. For this to matter, there has to be two things happen. First the community property payments have to create equity that wasnft there before and second the house had to increase in value substantially. Both were present in Branco making the community property interest more than nominal, which is why they took it up on appeal.
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> In our current economic environment, the recent increase in value is unlikely but the other factor remains the same- the more time paying on the loan, the greater the community property interest. Of course an underwater house may not ever have a community property interest.
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> The lesson for us as bk lawyers is that there are a lot of facts that may be relevant that will only be ferreted out if we dig deep enough. This area is very fact specific.
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> If you have any questions or concerns, please contact me.
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> Pat
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> Patrick T. Green
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> Attorney at Law
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> Fitzgerald & Green
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> 1010 E. Union St. Ste. 206
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> Pasadena, CA 91106
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> Tel: 626-449-8433
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> Fax: 626-449-0565
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> pat@fitzgreenlaw.com
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>
Nathan Berneman
> Sent: Monday, November 19, 2012 5:30 PM
> To: cdcbaa@yahoogroups.com
> Subject: Re: [cdcbaa] Filing chapter 7 for separated spouse
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> That's what I always thought from community property laws. However, I had a case in 2005, where the Trustee was able to use a case by the name of In re Marriage of Branco (1996) Cal. App. 4th, 1621 to show differently to the bankruptcy court and gave the Debtor a community property interest that was much larger than any family law attorney I spoke to at that time could have imagined and all of them never even heard of this case at that time I figured that the amount was nominal in the entire analysis but that was not the case. Luckily, I subbed into the case to help the debtor and was not the original attorney who filed the bk.
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> With this filing, I believe it would be best if the husband (who is separated from my client), waited until after the discharge so we don't have to make any motions while she is in the bankruptcy to allow the quitclaim to go forward.
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> Any thoughts would be appreciated
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> Thank you,
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> Nate Berneman
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> To: cdcbaa@yahoogroups.com
> Sent: Monday, November 19, 2012 4:21 PM
> Subject: RE: [cdcbaa] Filing chapter 7 for separated spouse
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> Nate:
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> The refi will not create a community property interest in the home. The lender will want a quit claim from the wife. If there is a community property interest it comes from community property funds used to pay down the mortgage. Unless there is a pre or post nup to the contrary, wages are community property. It is always best to analyze all separate property held by a married person to see if there is a significant community property interest. Typically it is nominal, but not always.
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> If you have any questions or concerns, please contact me.
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> Pat
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>
>
> Patrick T. Green
>
> Attorney at Law
>
> Fitzgerald & Green
>
> 1010 E. Union St. Ste. 206
>
> Pasadena, CA 91106
>
> Tel: 626-449-8433
>
> Fax: 626-449-0565
>
> pat@fitzgreenlaw.com
>
>
>
Nathan Berneman
> Sent: Monday, November 19, 2012 3:48 PM
> To: cdcbaa
> Subject: [cdcbaa] Filing chapter 7 for separated spouse
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> I have a client who has been separated from her husband for several months now as wants to file chapter 7.
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> Husband owns separate property prior to marriage that he wants to refinance and I am telling my client to file before he refinances so as to not cause a problem that the refinancing pre-bankruptcy would cause the community to have an interest in that property.
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> Is it best to have him refinance after the bankruptcy is filed AND discharged? Or just do his refinancing after she files the bankruptcy?
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> Thank you,
>
> Nate Berneman
>
> Sent from my iPhone: Nathan Berneman
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> Reply via web post Reply to sender Reply to group S
I consulted with my favorite certified family specialist. When I said M. of Branco, she said off the top of her head that it was an important marital property characterization case. She had to look at the case to refresh her memory on the rule of law, but she recognized it immediately. You may want to change horses next time you have a family law question. The case involved a W who owned separate property. A loan was taken on the separate property with both spouses as obligors with the proceeds being used to pay child support obligations of H and marital debt. The appellate court said that all payments towards the loan created a pro tanto community property interest in the property in the property. Any increase in the value of the property post loan was shared between the community property and separate property interests. For this to matter, there has to be two things happen. First the community property payments have to create equity that wasnt there before and second the house had to increase in value substantially. Both were present in Branco making the community property interest more than nominal, which is why they took it up on appeal. In our current economic environment, the recent increase in value is unlikely but the other factor remains the same- the more time paying on the loan, the greater the community property interest. Of course an underwater house may not ever have a community property interest. The lesson for us as bk lawyers is that there are a lot of facts that may be relevant that will only be ferreted out if we dig deep enough. This area is very fact specific. If you have any questions or concerns, please contact me. Pat Patrick T. GreenAttorney at LawFitzgerald & Green1010 E. Union St. Ste. 206Pasadena, CA 91106Tel: 626-449-8433Fax: 626-449-0565pat@fitzgreenlaw.com
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