Do’s & Don’ts of Status Only Dissolution

Under California Family Code Section 2337, a party may obtain what is called a “Status Only Judgment,” which is a judgment that terminates the marriage only, leaving all other issues (division of property, support, custody) to be decided at a later time. The most common reason that a party seeks a status only judgment is because that party wants to remarry. In other cases, the reason is psychological: a party feels that obtaining the divorce will help them move on from the relationship. Whatever the reason may be, it is important to understand the serious consequences that stem from a status only judgment.

1.Loss of Health Care Coverage: Once you are divorced, you are no longer eligible for health care benefits as a “spouse” under your spouse’s employer-sponsored health care plan. The cost of COBRA or an individual heath care plan can be astronomical. If you have any pre-existing conditions or current illness, it may be wise to wait for all issues in the case to be resolved to lengthen the time for which you are eligible under your spouse’s plan. If your spouse demands the status only, he or she will have to agree to continue coverage at his or her own cost until the divorce is final.
2.Loss of Surviving Spouse Retirement Benefits: Similarly, once you are divorced, you are no longer considered a “surviving spouse” for purposes of surviving spouse retirement plan benefits. Accordingly, it is critical that you obtain a Qualified Domestic Relations Order preserving your rights in the retirement plan before agreeing to the status only.
3.Application of Probate Rules: Should your spouse die at any point after the status only but before the final judgment that divides the community estate, the probate code, not the family code, will apply. This could mean the loss of your rights in property that is held in the deceased party’s name alone even if it would otherwise be a community property asset by virtue of the date of purchase or other agreement between the spouses.

These are just a few of the possible consequences of a status only judgment. In recognizing these and other significant consequences, the legislature recently modified the statute governing status only judgments to provide more protection for the spouse whose rights are adversely affected. Typically, the party seeking the status only will be required to “indemnify and hold harmless” the other party; this means that should there be any adverse consequences as a result of the status only, the requesting party will be required to pay for any such losses incurred by the other party.