In Louisiana, when two spouses each hire a divorce attorney to end the marriage, there may be an issue as to property. By that I mean, the spouses will need to find a way to split the property that they owned during (or before) the existence of the marriage. In a very general sense, property earned during the course of the marriage is considered “community property” whereas property earned before the marriage (or in another way that excepts it from being community property under Louisiana law) is called “separate property.” This distinction is a very important one because spouses typically share the community property equally fifty-fifty; whereas separate property remains in the sole possession of the spouse to whom it belongs.
The same can be generally said for “obligations.” Community obligations are owed equally between the spouses if they get divorced, which is not necessarily true of separate obligations. Today’s article deals with a special situation: when one spouse uses community property to fulfill a separate obligation.
For example, let’s say that Wally and Wanda just got married. Before they were married however, Wally took out a loan to buy a fishing cottage outside of Houma. He had barely made any payments on the loan by the time that he married Wanda. After Wally and Wanda had been married for six months, they were very deeply in love. They decided to start sharing the same savings account, with a dream of retiring one day to the Canary Islands.
Wally continued to enjoy fishing out at his fishing cottage. Wanda, however, could not stand fishing, nor the dingy cottage that her husband bought before they were married from his friend who was divorce attorney. She derived absolutely zero use or enjoyment from the property whatsoever. One day, Wally went into the savings account that he shared with Wanda and withdrew enough money to pay off the loan that he took out for the fishing cottage.
Now let’s say that Wally and Wanda decide to each hire a divorce attorney. The legal proceedings are very acrimonious. One big issue is the fishing cottage. Wanda thinks that she should be reimbursed for the money Wally spent to pay off the property.
There is a specific Louisiana Civil code article dealing with this issue: Louisiana Civil Code article 2364, entitled, “Satisfaction of separate obligation with community property or former community property.” This article states that when one spouses uses community property to satisfy a separate obligation, and then the other spouse is entitled to one half of the value of that community property used. In this case, Wally and Wanda had an arguably pretty clear example of community property (their shared savings account.) Wally dipped into these funds to purchase what may be argued was solely his separate obligation (the loan on the fishing cottage which he took out before he was married, and which did not benefit the family in any way.) That said, Wanda’s divorce attorney could probably make a good argument that she is entitled to one half of the money that Wally used to satisfy this obligation in reimbursement.
This article is written to be general information only; it should not be taken as formal legal advice. Will Beaumont. New Orleans.