There are numerous types of reimbursement claims which are often raised in divorce cases. For instance, if, after separation, you make payments on community property bills (bills in which were incurred before separation), then your spouse should reimburse you 50% since you are both equally liable for community property bills. There are also other reimbursements claims which are sometimes applicable.
- Family Code Section 2640
- Under Family Code Section 2640, a party is entitled to reimbursement for separate property contributions to acquiring property during the marriage. Separate property is property acquired prior to marriage, property acquired during marriage that was acquired by gift or inheritance, or property acquired after the date of separation. Examples of reimbursable separate property contributions under this statute are down payments on a community property house, payments for improvements on community property, or payments towards the principal on a mortgage for a community property debt.
A party is also entitled to reimbursement of his/her separate property contributions towards the other party’s separate property.
- A Moore/Marsden claim is a claim that the community should be reimbursed for mortgage payments on a house that is one party’s separate property. There is a formula that is applied to determine the amount of reimbursement, taking into consideration the interest rate on the loan and appreciation in value of the home over time.
- A Watts charge is a charge to one spouse for the exclusive use of community property after the date of separation. The most common example of a Watts credit is when one spouse remains in the community property home, while the other spouse is displaced. In this case, the displaced spouse is entitled to charge the spouse in the home “rent” for one half the fair market rental value of the home. For example, if the fair market rental value is $3,000 and the mortgage is $1,800, then the displaced spouse could claim $600.00 per month (one half-the difference) for the time period he or she was displaced.
An Epstein credit is reimbursement for use of separate property funds to pay community property debt after the date of separation. For example, in the displaced spouse example, if the spouse continues to pay the mortgage on the home on a monthly basis, that spouse is entitled to reimbursement for one half the mortgage payments.