Devlin v. Devlin
1982 Cal. App. LEXIS 2281, 189 Cal. Rptr. 1, 138 Cal. App. 3d 804 (1982)
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Rule of Law:
Property purchased during a marriage with traceable community property personal injury damages retains its special character. Upon dissolution, such property is to be assigned to the injured spouse unless the interests of justice require a different disposition, and its character is not changed merely by taking title in joint tenancy.
Facts:
- The parties were married in July 1975 and separated for the final time in May 1981.
- During the marriage, the husband was severely injured in an automobile accident which rendered him a paraplegic.
- After the accident, the husband received personal injury damages totaling at least $175,000.
- All of the community property the couple owned at the time of separation was purchased with the husband's personal injury proceeds.
- This property included a mobile home specially equipped and adapted for the husband's disability and the real property on which it was located.
- The parties took title to the real property and mobile home in joint tenancy.
Procedural Posture:
- Wife filed an action to dissolve the marriage in the trial court.
- The trial court determined that all of the community property was traceable to husband's personal injury proceeds.
- The trial court awarded the bulk of the property (the mobile home and realty) to the husband, exercising its discretion under Civil Code § 4800(c).
- Wife (appellant) appealed the trial court's judgment to the intermediate appellate court, arguing the property should have been divided as ordinary community property.
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Issue:
Does property purchased with community property personal injury damages lose its special statutory character, thereby becoming ordinary community property subject to equal division, if the couple takes title to the property in joint tenancy?
Opinions:
Majority - Evans, J.
No. Property purchased with community property personal injury damages does not lose its special character and become ordinary community property merely because title is taken in joint tenancy. The court reasoned that the legislative intent of Civil Code § 4800(c) is to treat such damages, and property acquired with them, as a unique category of community property meant primarily to compensate the injured spouse. The rules for transmuting separate property to community property do not apply because these damages are already community property by statute, albeit a special kind. Therefore, the form of title is not determinative. The property only loses its character as 'community property personal injury damages' if it is irretrievably commingled with other community property, which did not happen here as all property was traceable to the husband's award.
Analysis:
This decision clarifies that the special protections for personal injury awards under California's Family Law Act extend beyond the initial cash proceeds to any property purchased with those funds. It establishes that traceability, not the form of title, is the key factor in determining whether property maintains its character as 'community property personal injury damages.' This prevents the non-injured spouse from claiming a 50% interest in assets that may be essential for the injured spouse's long-term care and well-being, such as a specially adapted home, simply because the funds were converted from cash to real property. The ruling reinforces the trial court's discretion to achieve an equitable division based on the unique circumstances surrounding such funds.
