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Posted on January 12, 2014 in Assets
Under California law, the Family Court is required to divide community assets and community liabilities equally1 between the parties, unless the parties have entered into a property settlement agreement that sets forth a different arrangement. A San Diego family law attorney must identify and place a value on all community assets and liabilities. If this information is suspect, various procedures of investigation are available under the laws that are commonly called “discovery.”
Common Forms of Discovery
Comparing Discovery to Disclosure
Historically, the laws of discovery are much older than the law of disclosure. When discovery procedures are properly used, the person responding is compelled to respond under penalty of perjury and under threat of monetary penalty. Skillful questioning under cross-examination not only commits a witness to a story but it uncovers many details or leads that produce a successful conclusion.
The law of disclosure puts an affirmative obligation on each party to unilaterally produce financial information. It is not as thorough an obligation as that which is produced with form interrogatories and a one-hour deposition. Disclosure does little or nothing to reveal child sharing plans. Although a preliminary disclosure is made under penalty of perjury, the law allows the amendment to preliminary disclosure later in the case. Thus, the preliminary disclosure may not be a source of reliable information in some cases.
Accepting a settlement based upon disclosure alone where the conclusion of the case accepts a “Waiver of Final Disclosure” may be dangerous if the case is concluded without basic discovery. Both the entry of judgment based upon the waiver of final disclosure or based upon disclosure could mean that a party to the divorce is stuck with the deal even if they realize later that an asset was undervalued or mistakenly characterized as a non-marital asset.
Balancing the Use of Discovery with Disclosure
The degree to which discovery is necessary in a case will depend on the complexity and size of the estate and the obligations. It will also depend upon the type of problem between the parties. For example, if the husband and wife cannot agree on child sharing or who should be the primary parent, discovery may become critical. If one party has been primarily involved in running a family business or primarily responsible for paying family bills, discovery may be more important to the spouse who needs the information.
Both discovery and disclosure may be used to build trust between the husband and wife at a time when trust is critical. Discovery may be used to compel communication when emotional pulls hamper communication. Early and thorough disclosure leads the receiving party to believe that the other spouse is not hiding money. When disclosure is forthright and the needs of the parties to discovery are met, then the case may proceed to settlement and a knowledgeable waiver of the Final Declaration of Disclosure.
1There are many complex exceptions to this general rule including rights to reimbursement and rights to credits.