Questions clients ask.

The term “legal separation” is misleading. In California, married couples are deemed separated when they are no longer planning on remaining a married couple, and at least one party has communicated this intention to the other. It does not necessarily mean the parties are no longer living together, as many couples remain in the same house for financial or other reasons. However, moving out is very good evidence of an abandonment of the marital relationship if the date of separation becomes a contested issue in court.

Couples who are no longer living together but are still acting like a couple, or are seeing a counselor, are not considered separated because they have not abandoned the marital relationship.

One reason the term is misleading is that married people can go to court to get a judgment of legal separation, which is different from being “legally separated.” A judgment of legal separation can provide all the relief a judgment of dissolution provides, except for changing the parties’ status from married to single.

Because people’s actions and statements regarding their intentions can be ambiguous, it is best to consult a family law specialist to evaluate your circumstances if you need to know whether you are legally separated. The date of separation has important financial consequences in a dissolution case.

If the parties are in agreement, a judgment can be submitted to the court as quickly as the papers can be prepared. For most attorneys or parties, this means at least a few days. How long it takes the clerk to process the papers depends on the county, and can run to six weeks or more.

Under California law, the court cannot change the status of the parties until six months after service, or acceptance of service, of the summons. When the paperwork is done immediately, the judgment will contain a future date on which the parties’ status changes from married to single. No hearing is required. The parties simply become single once the date stated in the judgment passes.

From a legal standpoint, parties can date after separation, or even before separation for that matter, and in most instances it will not affect your family law case.

If there are children involved, getting new partners involved in the children’s lives is not a good idea. Do not introduce new partners to the children. It will only cause problems in most instances, and it can affect the custody and parenting orders.

From a practical standpoint, nothing sets off a soon-to-be ex-spouse more than a new partner dating their soon-to-be former spouse. It can heighten emotions and make settlement more difficult.

In order to be enforceable, a prospective spouse must be given at least seven days to review a prenuptial agreement before signing. This gives the prospective spouse time to seek legal advice and review the agreement.

It is better practice to allow more time whenever possible, as it is not always possible to get in to see a family law attorney within seven days, and more time may be needed if changes are requested.

Do not wait until the last minute to present a prenuptial agreement to your prospective spouse.

Although the California Supreme Court has stated that particular words are not required, in practice many writings that most people would consider adequate have been held to be inadequate.

For that reason, it is important that any transaction involving married persons be documented by an agreement drafted by an experienced family law specialist.

No. However, notarizing the signatures may avoid later claims that the signature of one spouse is a forgery.

If the transfer involves an asset of substantial value, requiring notarized signatures is advisable.

Yes. California is a community property state, which means that, absent a written agreement otherwise, all wealth created during the marriage is considered to be 100% owned by each of you, and is subject to levy (seizure) for the debts of either one of you.

No. There is no absolutely sure way to protect your assets from creditors. However, with the right planning, you can make it so hard for creditors to collect from your assets that they will not want to incur the expense and time involved in pursuing their claim against you.

Despite this, many people think they are protected by simply placing valuable assets in the name of their spouse. Without expert help and the right agreements, simply transferring title of a valuable asset to your spouse does not work.

Yes. With a properly drafted transmutation agreement or post-marital agreement (also often called a postnuptial agreement), what was formerly community property, or your separate property, can be changed to the separate property of your spouse, and will not be subject to seizure to satisfy your debts.

Yes. One vehicle is forming a limited liability partnership to hold your assets. Although it is quite technical, there are many advantages to holding title to your assets in an LLP as opposed to a corporation. It is also possible to set up a foreign trust to hold title to your assets.

None of these vehicles can provide 100% assurance that your assets will be protected from creditor claims. The goal is to make it so difficult and expensive to challenge your plan that most creditors will simply abandon the claim, or be unsuccessful in their collection efforts. It has been estimated that two-thirds of creditors faced with a well-drafted asset protection plan will abandon the claim, and that only a small percentage of the remaining third will be successful.

Generally, no. A corporation only protects your personally held assets from claims against the corporation, not from claims against you.

In addition, most creditors who loan money or supply services to a corporation will get personal guarantees from the business principals before extending credit. Finally, if a successful claim is made against you personally, your stock in the corporation can be seized to satisfy the claim.

No. If a claim has already been filed against you and you have assets to satisfy it, doing nothing almost certainly assures that you will be required to pay the claim.

If you seek expert advice and devise a well-conceived plan, you may be successful in protecting your assets, and you will certainly improve your negotiating position. The worst that can happen is that your plan does not work, and you will have incurred the legal and accounting fees involved in setting it up.

No. The law provides that residents of California, as well as residents of other states, can hold property titled in many different forms. The law also allows spouses to transfer property between themselves, so long as they follow certain well-defined procedures and methods.

Holding property titled one way as opposed to another has certain advantages when it comes to asset protection. Agreements that help protect your assets from creditor claims simply take advantage of the legal rights available to individuals to hold title to property as they choose.