Before marriage, Karen purchases a home in California using her own funds and takes title in her name alone. During the marriage, she makes all mortgage payments exclusively from a pre-marriage savings account that has never been commingled with marital funds. Her spouse contributes nothing financially to the property. At divorce, which outcome would a California court MOST likely reach regarding the home?
Correct Answer
C) Karen's separate property interest is preserved in full because no community funds were ever used, leaving no basis for a community claim
Under California Family Code §770, property acquired before marriage is separate property. The Moore/Marsden apportionment doctrine (In re Marriage of Moore (1980) and In re Marriage of Marsden (1982)) can give the community a pro-rata interest in a separately owned home when community funds — such as earnings during marriage — are used to pay down the mortgage. However, where the paying spouse can trace all mortgage payments to a pre-marriage separate property account that was never commingled with community funds, no community contribution occurred and no community interest arises. Because Karen's payments are fully traceable to her separate funds, the court would most likely find the home remains entirely her separate property with no community interest to divide.
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