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Fiduciary Duties Between Spouses: Respect Thy Spouse

June 19, 2012/1 Comment/in Family Law /by Gina Policastri

Husband uses wife’s private shopper and bank account to purchase $1.4 million worth of luxury goods from Neiman Marcus. Wife is bedridden the entire time recovering from a traffic accident. Private shopper is having sexual relations with husband, and earns a commission off of the sales. Neiman Marcus is reportedly refusing to return the goods. (See http://abcn.ws/KsRBy8.) Does wife have any legal recourse for the purchases she did not participate in? This true story is one extreme example of how spouses can breach the fiduciary duties they owe to each other.

Under the California Family Code, spouses are treated much like business partners and must deal fairly and in good faith with each other. The fiduciary duties require an “accurate and complete” disclosure of all transactions and provide that spouses share equal management and control of their community property. These duties are subject to few exceptions and the consequences for breaching them can be severe.  If you find yourself on either side of a breach of fiduciary duty claim, the experienced attorneys at Lonich Patton Ehrlich Policastri can assist you in determining your rights, obligations and exposure.

The Certified Family Law Specialists*  at Lonich Patton Ehrlich Policastri have decades of experience handling complex family law matters.  If you are interested in learning more about your fiduciary rights and obligations, contact the Certified Family Law Specialists* at Lonich Patton Ehrlich Policastri for further information.  Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may detail general legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

*Certified Family Law Specialist, The State Bar of California Board of Legal Specialization

https://www.lpeplaw.com/wp-content/uploads/2021/05/LPEP_PC.png 0 0 Gina Policastri https://www.lpeplaw.com/wp-content/uploads/2021/05/LPEP_PC.png Gina Policastri2012-06-19 10:56:232021-12-22 21:29:40Fiduciary Duties Between Spouses: Respect Thy Spouse

There’s No “Hiding the Ball” in Family Law Cases: The Importance of Understanding your Fiduciary Obligations to your Spouse or Domestic Partner

May 6, 2011/1 Comment/in Family Law /by David Patton

The California Family Code incorporates the rules of civil discovery that are generally applicable in all civil cases.  Discovery is the process by which the parties to a legal dispute obtain information about the other side’s case so that the parties can engage in informed settlement negotiations and prepare their case for trial.  Discovery devices include interrogatories (written questions to the other party requiring written responses under oath), depositions (taking oral testimony under oath from the other party), and inspection demands (requiring the other party to produce documents and/or tangible things for inspection).

In an ordinary “arm’s length” civil case (a contract dispute, for example), it is crucial to utilize these procedures effectively, as they are often the only means available to obtain information about the other side’s case.  Parties in “arm’s length” civil disputes ordinarily have no independent duty to give the other side any information outside of the discovery process.

While discovery sometimes has its purpose in family law cases, there is an important distinction that makes family law cases unique.  Under the Family Code, spouses owe one another fiduciary obligations both during the marriage and after separation.  In other words, spouses must act “with the highest fairness and honor” in their dealings with one another.  This is the highest duty known to the law.  It is akin to the duty an attorney owes to his or her client and the duty owed to a business partner.

Why is this significant?  It is significant because it means spouses have an independent obligation to disclose all material facts and information regarding the existence, characterization, and valuation of assets and debts, and all information about income and expenses, without request.  This duty applies both during marriage and after separation until the date the asset or liability in question is actually distributed and, as to support and professional fees, until a binding resolution is reached on these issues.  A spouse need not conduct formal discovery to enforce these obligations.

The consequences for violating one’s fiduciary duty can be devastating.  Emblematic of this is the landmark California Court of Appeals decision in In re Marriage of Feldman, in which the court upheld an order levying $390,000 in sanctions against the husband for the husband’s failure to disclose financial information.  The Feldman decision, issued in 2007, has generated much discussion in the legal community and is a significant articulation of the importance of this issue.

Other significant consequences can result from failure to adhere to spousal fiduciary obligations beyond monetary sanctions.  It is therefore essential that parties initiating dissolution proceedings are aware of their rights and obligations from the outset, and that they carefully abide by the rules governing fiduciary obligations to avoid adverse consequences down the road.

If you have questions regarding your fiduciary obligations or those of your spouse, please contact the experienced Family Law attorneys at Lonich Patton Ehrlich Policastri for further information.  Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may include legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

https://www.lpeplaw.com/wp-content/uploads/2021/05/LPEP_PC.png 0 0 David Patton https://www.lpeplaw.com/wp-content/uploads/2021/05/LPEP_PC.png David Patton2011-05-06 10:10:262021-12-22 21:38:43There’s No “Hiding the Ball” in Family Law Cases: The Importance of Understanding your Fiduciary Obligations to your Spouse or Domestic Partner
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Located in San Jose, Lonich Patton Ehrlich Policastri handles matters for clients in northern California, specifically San Jose and Silicon Valley. Our services are available to anyone within the following counties: Santa Clara, San Mateo, Contra Costa, Santa Cruz, Monterey, and San Benito. For a full listing of areas where we practice, please click here.

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This web site is intended for informational purposes only and is not legal advice. Nothing in the site is to be considered as either creating an attorney-client relationship between the reader and Lonich Patton Ehrlich Policastri or as rendering of legal advice for any specific matter. Readers are responsible for obtaining such advice from their own legal counsel. No client or other reader should act or refrain from acting on the basis of any information contained in Lonich Patton Ehrlich Policastri Web site without seeking appropriate legal or other professional advice on the particular facts and circumstances at issue.

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