Legal Question in Family Law in California
I established a new LLC (ABC Co.) with my existing business partner (123 Inc.) for the purpose of purchasing a building that we, 123 Inc., would occupy as tenants.
My partner and I each put up $50,000.00. Neither of our wives names appear anywhere on the ABC Co. paperwork, the 123 Inc. paperwork or anywhere on the paperwork for the purchase of the building (we did qualify for, and have, a small business loan for the building).
I used money from the sale of a house I owned Free and Clear before I ever met my wife for my share of the down payment. However, before I sold it, my wife and I took $45,000 out of my house while she and I were living in it as man and wife and put her name on the deed. I eventually sold my house for $327,000.00.
We are divorcing and I am now selling the building and dissolving ABC company.
Is my wife entitled to any of the proceeds from the sale of the building?
3 Answers from Attorneys
Yes. It sounds like you co-mingled the money and it can be construed as a gift to community property. You need a lawyer to straighten this out in the dissolution.
It sounds like she is entitled to a share to me.
Much will depend on whether putting her on the deed to the house before you sold it and used the proceeds for ABC was a gift or for some other purpose. She will, of course, argue gift. Even if, however, you manage to get the house clear of her claims, she may still have some claim to the value of ABC based on you being a working owner of the company, rather than a mere investor. As Ms. Karnazes said, you need a lawyer to look at all the facts, details and documents to sort this one out.
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