‘Separated’ spouses must live apart, rules court

The California Supreme Court ruled in San Francisco Monday that divorcing couples must live in separate residences in order to claim separate property.

The court issued its ruling in the Alameda County Superior Court case of a divorcing couple who continued to live with their two children in their Castro Valley home while they were estranged.

The wife, Sheryl Jones Davis, claimed they became legally separated in 2006, the year she told her husband she wanted a divorce.

She said they were living together in the home as roommates for the sake of the children at that point, that she had taken steps to separate their finances and that they had moved to separate bedrooms several years earlier. She filed for divorce in 2008.

The now-divorced husband, Keith Davis, maintained that they weren’t separated until she moved out of the Castro Valley home in July 2011.

He claimed her earnings until July 2011 were community property, to which he was entitled to an equal share.

California family law provides that the earnings and property acquired by spouses during marriage are generally community property. It also states that the:

“… earnings and accumulations of a spouse … while living separate and apart from the other spouse, are the separate property of the spouse.”

Sheryl Davis contended the couple’s arrangement met the requirement of living separately and apart during those five years and that Keith Davis was not entitled to a share of her earnings.

But the state high court rejected that argument, saying the history of the law, the common understanding of the words, and the need for legal clarity required that the spouses must have separate residences.

Chief Justice Tani Cantil-Sakauye wrote for a unanimous court:

“A bright-line rule … promotes fairness by providing a measure of predictability to the parties and their attorneys, as well as clear guidance to judges. …¬†It reduces the potential for manipulation of a more elastic standard by the higher earner in situations of significant disparity of spousal income.”

Stephanie Finelli, a lawyer for Keith Davis, said:

“The decision will be helpful to trial judges and parties in divorce cases so people won’t be guessing as to when they are separated.”

Finelli said the outcome of the case will make a substantial financial difference to Keith Davis because Sheryl Davis earned “significantly more” than he did during those five years.

Sheryl Davis’s attorney, Lilia Duchrow, was not available for comment.

The current wording of the Family Code provision was set by the state Legislature in 1971, but was based on an 1870 law, intended to protect women at a time when women had fewer financial rights, that said a married woman’s property was separate if she was “living separate and apart from her husband.”

Cantil-Sakauye wrote that there was no evidence the Legislature intended to change the meaning of the phrase during the 20th century.

Keith Davis appealed to the state Supreme Court after Alameda County Superior Court Commissioner Elizabeth Hendrickson and a state appeals court in San Francisco agreed with Sheryl Davis and set the date of separation as 2006.

The decision resolves a conflict between the San Francisco-based appeals court and a Court of Appeal panel in San Jose that reached the opposite conclusion in 2002. The San Jose-based appeals court said that under the law, “living apart physically is an indispensable threshold requirement to separation.”

The state high court agreed with that interpretation. It also said that in addition to having separate residences, as least one of the spouses must have proof of intent to end the marital relationship in order to claim legal separation for purposes of property division.

The evidence of intent could be “words or conduct reflecting that there is a complete and final break in the marriage relationship,” Cantil-Sakauye wrote.