Are you responsible for your spouse’s debt?
Spouses may be partially liable for their partner’s debt, even those incurred before marriage. Here’s what you need to know about spousal liability for debt.
California is a community property state, which means that property and debt obtained during the marriage is owned by both spouses. According to California Family Code Section 910, the community estate is generally liable for debt incurred by either spouse before and during the marriage. This means that even if a spouse incurs debt solely through their own personal actions before marriage, their spouse will generally become partially liable for such debt as their community estate is liable.
Community vs. Separate Property
Before discussing spousal liability for debt, it is important to understand the distinction between community and separate property. California is a community property state, which means that all property and debt (excluding gifts and inheritances) obtained during marriage is presumed to be equally owned by both partners. The total amount of community property comprises the community estate. In the event of a divorce, this community estate will generally be divided equally among both partners if there is no written agreement that states otherwise.
In contrast, separate property is generally anything that a spouse acquired before marriage or after the date of separation. In the event of a divorce, the spouse will generally retain their separate property unless there is an agreement that states otherwise. In addition, if a spouse receives a gift or inheritance during the marriage, that is generally also considered separate property.
California Family Code Section 910
California Family Code Section 910 is very important in terms of spousal liability for debt. It states that the community estate is liable for debts incurred by either spouse, regardless of whether or not the debt was incurred prior to or during the marriage. However, this does not apply to debts acquired after the date of separation.
This means that two spouses’ shared property can be held liable for the debts of only one of the spouses, even if that spouse incurred the debt prior to marriage solely through their own actions. Therefore, if spouses have a joint savings account in which they deposit their earnings, that community account can be held liable for the debt of only one spouse even if the debt was incurred prior to the marriage.
Exceptions
California Family Code Section 911 provides an exception to Section 910. A spouse’s separate earnings will not be held liable for the other spouse’s debts incurred prior to the marriage if those earnings are deposited into an account that the other spouse cannot withdraw from. The earnings must also be not commingled with other community estate property. This means that, for example, earnings invested into a shared house would not be exempted from the debt liability.
In addition, as previously stated, the community estate will not be held liable for debts incurred after the date of separation, which is distinct from the date of divorce. California Family Code Section 70 defines the date of separation as the date in which a spouse expresses to the other the intent to end the marriage and begins acting in accordance with that intent. This is why determining the date of separation is so critical: it can determine whether or not a given spouse should be held liable for certain debts.
It should also be noted that a spouse’s separate property cannot be held liable for a debt incurred by the other spouse, as affirmed by California Family Code Section 913.
FAQs about California Family Code Section 910: Spousal Liability for Debt
Am I liable for my spouse’s debt incurred prior to our marriage?
Your shared community estate will be held liable for either of your debts incurred prior to or during the marriage. Your separate property, however, will not be held liable.
Why will I be liable for my spouse’s debt incurred prior to my marriage?
California is a community property state, which means that property acquired during the marriage is equally shared by both. Therefore, it makes sense that this community property would be held liable for debts incurred by only one person because community property is owned just as much by your spouse as it is by you.
What are the exceptions to this?
Earnings by a spouse deposited into an account that cannot be withdrawn from by the other spouse will not be held liable for the other spouse’s debts acquired before marriage. In addition, the community estate will not be held liable for debts incurred after the date of separation.
What is the community estate?
The community estate is the community property of a marriage. It is all the property and debts accumulated during the marriage. The community estate is equally owned by each spouse.
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