Destruction of Property and Lost Assets in Divorce / by Cassandra Hearn

California is a community property state. This means that any marital property will be divided equally at the end of the divorce proceedings. Because emotions run high in divorce proceedings and one spouse may want to do everything in his or her power to hurt the other spouse, that spouse may turn to intentionally destroying property to get back at the other spouse. Intentionally destroying property or even losing an asset will impact the way the court will rule at the final divorce hearing.

At the beginning of any divorce, an Automatic Temporary Restraining Order will be issued by the court where the divorce petition and other papers are filed. This order prevents both spouses from doing (or failing to do) certain things, but significantly, both parties are order to not dispose of, nor destroy, any property. This applies regardless of whether the property is community property or separate property. Disposing of property may include not just throwing away assets, but intentionally destroying them. Therefore, if either spouse intentionally destroys any property after the divorce is filed, he or she would be in violation of the temporary restraining order, and may be held in contempt. These obligations are also codified in Section 2040(a)(2), where it is stated that the parties are barred from disposing of community property. In addition, Section 1100 imposes a fiduciary duty on the spouse who controls the community property at the time the divorce is filed.

Moreover, the spouse damaging the property may be guilty of criminal vandalism. California penal code section 594 applies to criminal vandalism. The spouse intentionally destroying property may be charged with and found guilty of this crime, even if it is community property. The penalties for this crime include jail time or fines up to $10,000, depending on the severity of the crime and the value of the destroyed property.

If a judge determines that your spouse intentionally destroyed property or wasted marital funds, then the judge may alter the balance in the property division. A judge may award you more of the remaining assets to make up for what your spouse intentionally threw away, destroyed, or wasted.

Lost assets can be a different issue. If you can prove that your spouse intentionally “lost” the asset by failing to maintain or pay for the asset when he or she could have, then it may be classified the same way as an intentionally destroyed asset. For example, if one spouse is living in the marital home, but loses the home in a foreclosure by refusing to pay the mortgage, that spouse can be changed with reimbursing the community for half of the value of the home. Each spouse has a fiduciary duty to the community, and as long as a spouse can afford to preserve an asset, that spouse must do so until the court can divide the asset.  

If you believe your spouse has intentionally destroyed or wasted marital assets, you need help to protect your financial future. Call us today at (619) 800-0384 to discuss your options.