Leslie L. Abrigo, APC
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Chula Vista Family Law Blog

High-net worth divorce: Separate account may not protect assets

It is a natural consequence of the passage of time that current generations might do things differently than their ancestors. For instance, long ago, it was assumed that only men would leave their homes to go to work while women stayed home full time to raise their families. Nowadays, most households include dual income earners. Another way that times have changed is that many young spouses today keep their money in separate bank accounts; however, in a California high-net worth divorce, this might not protect their assets as they'd hoped.

While it might seem logical to assume that money deposited in a separate account belongs to the person whose name is on the account, in cases of divorce, especially in a community property state, this is not necessarily so. California happens to be one of nine community property states throughout the country. This means the court typically divides all marital property 50/50 in divorce.

Frankel and Hoppy not getting along during child custody case

Many California parents understand what it is like to disagree about child-related issues. For SkinnyGirl founder, Bethenny Frankel, and her ex-husband, Jason Hoppy, those disagreements have led to a contentious courtroom battle that is finally coming to a close. Soon, the judge overseeing their child custody case will hand down a ruling.

Hoppy recently spoke about his 9-year-old daughter, saying her best interests are all that matter to him where Frankel is concerned. He said that going to counseling has helped him lay to rest the ill feelings he has had for the child's mother in the past. He also happened to mention to the court, however, that not only does he disagree with much of what Frankel has said during child custody proceedings, he also thinks she is lying about certain issues.

Hollywood icon Robert De Niro in a high-net worth divorce

Some California couples can relate to being married, getting divorced, then reuniting with their former spouses, only to wind up in divorce court again some years later. That's basically what happened between superstar actor Robert De Niro and his estranged wife (for the second time) Grace Hightower. The two are currently battling over marital assets in a high-net worth divorce, including custody issues regarding their youngest child.

De Niro filed for divorce in December. His net worth is currently estimated to be half a billion dollars. He and Hightower signed a prenuptial agreement before they were married the second time. An attorney representing Hightower says De Niro's refusal to see his wife as an equal partner was a major factor in their first divorce and the prenup was signed so that things could be different moving forward.

Consider these high net worth prenuptial issues before marriage

Some California spouses are quite similar to each other. They grew up in similar environments, perhaps were educated at the same universities or maybe even have worked in similar fields before deciding to get married. Other couples are examples of the old cliche about opposites attracting. They are different on nearly every level, especially regarding finances. When potential spouses have a tremendous imbalance of wealth, it makes sense to consider a high net worth prenuptial agreement.

California is a community property state. It is one of nine states that operate under such laws in divorce. Judges in these states usually split marital property 50/50 between spouses in divorce. A prenuptial agreement is an essential tool for a person of high net worth who files for divorce in a community property state.

The more you know re California property division, the better

Regardless of the particular state someone lives in, making the decision to divorce is never something to be taken lightly. State residence, however, can indeed have a significant impact on the ultimate outcome of a case. This is especially true regarding property division proceedings. There are currently nine states in the U.S. that operate under community property laws in divorce, and California is one of them.

Living in a community property state means that married couples have an equal share in all income, assets and debts acquired during marriage. In other words, everything obtained during marriage is considered jointly owned, no matter which spouse earned, purchased or acquired it. If a particular spouse incurred debt during marriage, community property rules state that both spouses are equally responsible for the debt.

High-net worth divorce: What will it mean for Adele?

Many music lovers in California and worldwide count Adele as one of their favorite artists. A recent announcement that she is headed for a high-net worth divorce prompted many fans to post their thoughts on social media. Some have said they believe the singer's personal life will likely spark a new album and may ultimately add to her $180 million net worth.

Whether a spouse happens to be a celebrity or not, when a high value assets are at stake, a divorce can get quite messy. State law has significant bearing on property division proceedings. California operates under community property rules, meaning that all marital property (and debt) is typically split 50/50 in divorce.

Should you sign a prenuptial agreement?

Many single people in California will no longer be single by year's end. That's because thousands of couples will "tie the knot" and get married; however, not every set of spouses will sign a prenuptial agreement ahead of time. There are benefits, as well as potential downsides, to entering a prenuptial contract. It is critical that a person considering signing a prenup should weigh both sides to determine if it is a good idea in his or her particular situation.

For business owners, for instance, protecting their companies' interests is typically a high priority. Signing a prenuptial agreement before marriage is often the best way to retain separate ownership of a business. This way, if a marriage ends in divorce, business assets will not be subject to division during proceedings.

When your co-parent sues you for child custody in California

Like most good parents in California and beyond, your children's best interests are always one of your highest priorities. When you decided to divorce, you logically assumed that your decision would have a significant impact on your children's lives. You likely also believed that, with a lot of love and strong support, you'd be able to help them successfully transition to a new lifestyle. When your ex filed a lawsuit against you for child custody, you may have felt like someone pulled the rug out from under your feet.

In a perfect world, co-parents would always agree to work together for the sake of their children. In reality, post-divorce custody situations can be quite stressful, especially if one parent is trying to undermine the parental rights or parent/child relationships of the other. If you're facing a lawsuit, there are several factors to keep in mind that the judge overseeing your case will no doubt consider before making a final decision in your case.

  • State Bar of California - California Board of Legal Specialization
  • South Bay Bar Association
  • San Diego Family Law Bar Association
  • Avvo
  • Best of South County
  • Best of South County 2017
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