In Re Marriage of Dekker

Summary

During marriage, wife's separate funds capitalized a corporation with $1,000, and its stock was issued only in her name. Husband devoted full time to the business, and an expert valued it at $927,000 at trial. The trial court gave wife her $1,000 plus a 10 percent annual return ($1,934) as separate property and the remaining $925,066 to the community. The court of appeal held that substantial evidence supported applying equitable apportionment and that the trial court did not abuse its discretion in choosing Pereira. It also held that judicial estoppel did not bar husband's claim, and it affirmed.

What it means for the financial analysis

The court held that market-rate salary paid to the working spouse does not end the apportionment inquiry, so a tracing or valuation analysis should separate the value growth due to separate capital from the growth due to community effort. It also confirmed that the choice between Pereira and Van Camp is discretionary and turns on which formula does substantial justice, so the analysis may need to present both methods rather than assume one.

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