As I went through my outline from my 2008 presentation, for NBI, on California probate law I realized I had pretty extensive materials on surviving spousal rights. I hope you find it interesting reading my outline!  I find any topic that I present to a room full of attorneys, like this one, is always a good way to make sure I know all the in’s and outs!  In these cases which include spousal property petitions among others we often can offer a flat fee arrangement so you know exactly what you will spend.  If you have any questions, or need a California probate attorney, let me know by phone, text, email, Skype, Zoom, Fax, or visit our website at www.californiaprobate.info

1. DETERMINING IF SPOUSE’S ELECTIVE SHARE IS A REASONABLE   OPTION

1:50 – 2:35  John B. Palley

1. Protection for surviving spouse.  Pursuant to Probate Code 6500 et seq. there are procedures in place to protect the surviving spouse and children in different situations.
   1. Pursuant to PC 6500 the decedent’s surviving spouse and minor children are entitled to remain in possession of the family dwelling and use the decedent’s personal property.  This for a period of 60 days after the inventory is filed or longer upon Court order.
   2. Pursuant to PC 6510 the Court may order the property of the decedent exempt from enforcement of a money judgment to the surviving spouse or minor children.
   3. Pursuant to PC 6540 the following are entitled to such reasonable family allowance out of the estate as is necessary for their maintenance according to their circumstances during administration of the estate:

a)      the surviving spouse;

b)      minor children;

c)      adult children who are incapacitated from earning a living and were dependent in whole or in part upon the decedent for support;

d)      upon Court order a family allowance can also be provided to other adult children who were actually dependent on the decedent and a dependent parent.

1. Spousal Rights and Personality
   1. Surviving Spouse’s Right to Community Property.  Upon the death of a married person, one-half of the community property belongs to the surviving spouse and the other half belongs to the decent (PC 100).  However, a husband and wife may agree in writing to divide their community property on the basis of a non pro rata division, or on the basis of the division of each individual item of community property, or partly on each basis.
   2. If the decedent died without a will (intestate succession) the decedent’s one-half of the community property passes to the surviving spouse (PC 6401).  Thus the determination of property as community or separate is crucial in cases of intestate succession.
   3. Upon the death of a married person, all the decedent’s property may pass to the surviving spouse without administration except: property passing to someone other than the surviving spouse under the decedent’s will or the law of intestate succession; property disposed of in trust under the will; and property in which the will limits the surviving spouse to a qualified ownership interest.  (PC 13500 et seq.)

PRACTICE POINTER: Though administration is not required by the probate code it may be required by the top lawmaker… a title company!  That is, at least a spousal property order confirming the asset belonging to and/or transferring to the surviving spouse.

1. Surviving Spouse’s Right to Compel Restoration of Community Property.  The surviving spouse may require the transferee of property in which the surviving spouse had an expectancy at the time of transfer to restore to the decedent’s estate one-half the property if all of the following are satisfied pursuant to PC 102:
2. the decedent died domicilied inCalifornia;
3. the decedent made a transfer of the property without receiving in exchange a consideration of substantial value and without the written consent or joinder of the surviving spouse; and
4. the transfer is one in which the decedent retained an interest, or one in which the decedent held the property in joint tenancy at the time of death.
   1. Surviving Spouse’s Right to Separate Property.  Under the laws of intestate succession, the surviving spouse is entitled to all, one-half or one-third, of the deceased spouse’s separate property when there is no will, depending on the relationship of the surviving family members (PC 6401).  For example, if the decedent left no children then the surviving spouse would receive 100% of the separate property, if 1 child then 50% to the surviving spouse, if 2 or more children 33% to the surviving spouse.  Again, this is the distribution as to separate property when the decedent had no will.
   2. Determining Alternatives for the Surviving Spouse – Disclaimers, Rights and Options.  In some circumstances, there may exist an agreement between the surviving spouse and the decedent with respect to disposition of property upon the decedent’s death.  The rights of the surviving spouse are governed by PC 140 et seq.
      1. A “waiver” means a waiver by the surviving spouse of any rights listed in PC 141(a), whether signed before or during marriage. These include:
         1. property that would pass by intestate succession;
         2. property that would pass by will executed before the waiver;
         3. a probate homestead;
         4. family allowance;
         5. the right to elect to take CP against the will;
         6. the right to take the statutory share for an omitted spouse;
         7. the right to be appointed personal representative;
         8. an interest in property subject to a non-probate transfer.
5. A waiver under PC 140 must be in writing and must be signed by the surviving spouse.
6. Of course, not all waivers are enforceable. Probate Code section 143 provides that a waiver is enforceable unless the surviving spouse proves either of the following:
   1. a fair and reasonable disclosure of the property or financial obligations of the decedent was not provided to the surviving spouse prior to the signing of the waiver unless the surviving spouse waived such a fair and reasonable disclosure after advice by independent legal counsel.
   2. The surviving spouse was not represented by independent legal counsel at the time of signing the waiver.
   3. PC 143(b) provides that Section 721 of the Family code does not apply if the waiver is enforceable under this section.  FC 721 relates to the fiduciary relationship between a husband and a wife; i.e. fair dealing.  It provides in full as follows:

§ 721. Contracts with each other and third parties; fiduciary relationship

(a) Subject to subdivision (b), either husband or wife may enter into any transaction with the other, or with any other person, respecting property, which either might if unmarried.
(b) Except as provided in Sections 143, 144, 146, 16040, and 16047 of the Probate Code, in transactions between themselves, a husband and wife are subject to the general rules governing fiduciary relationships which control the actions of persons occupying confidential relations with each other. This confidential relationship imposes a duty of the highest good faith and fair dealing on each spouse, and neither shall take any unfair advantage of the other. This confidential relationship is a fiduciary relationship subject to the same rights and duties of nonmarital business partners, as provided in Sections 16403, 16404, and 16503 of the Corporations Code, including, but not limited to, the following:
(1) Providing each spouse access at all times to any books kept regarding a transaction for the purposes of inspection and copying.
(2) Rendering upon request, true and full information of all things affecting any transaction which concerns the community property. Nothing in this section is intended to impose a duty for either spouse to keep detailed books and records of community property transactions.
(3) Accounting to the spouse, and holding as a trustee, any benefit or profit derived from any transaction by one spouse without the consent of the other spouse which concerns the community property.

1. PC 144 provides that a waiver is enforceable if the Court determines either of the following:
   1. the waiver at the time of signing made a fair and reasonable disposition of the rights of the surviving spouse;
   2. the surviving spouse had, or reasonably should have had, an adequate knowledge of the property and financial obligation of the decedent and the decedent did not violate the duty imposed by 721(b) of the Family Code.
2. PC 144 further provides if, after considering all relevant facts and circumstances, the court finds that enforcement of the waiver pursuant to subdivision (a) would be unconscionable under the circumstances existing at the time enforcement is sought, the court may refuse to enforce the waiver, enforce the remainder of the waiver without the unconscionable provisions, or limit the application of the unconscionable provisions to avoid an unconscionable result.
3. PC 145 provides that if the language of the waiver or property settlement agreement provides to the contrary, a waiver of “all rights” (or similar language) in the property or estate of a present or prospective spouse, or a complete property settlement entered into after or in anticipation of separation or dissolution or annulment of marriage, is a waiver by the spouse of the rights described in PC 141(a).
4. If the waiver, agreement, or property settlement is made after December 31, 1984, PC 147 provides that they are invalid insofar as it affects the rights listed in 141(a) unless it satisfies the requirements of PC 140-147.
5. Rights of Election
   1. The surviving spouse may elect that all or a portion of the following property be administered in a formal probate proceeding so as to cause all of the marital property to be distributed under the decedent’s will.
      1. the decedent’s ½ of the community property or quasi CP;
      2. the decedent’s separate property;
      3. the surviving spouse’s ½ of the CP or quasi CP.
6. Pursuant to PC 13502 this election shall be made in writing within four months of Letters issuing or at any other time as the court may allow upon a showing of good cause.
7. The surviving spouse may elect to have all or part of the property transferred to a trustee under the decedent’s will or trust to be administered and distributed by the trustee.
8. The surviving spouse may also elect to take community property (or quasi CP) against the decedent’s will.
9. E.     Spousal Property Petition  (PC 13500 et seq.)
   1. Although California law authorizes the deceased spouse’s property to pass to the surviving spouse without formal court proceedings, practical considerations may require some procedure to confirm the passing of the property (i.e. as mentioned above, title companies).  PC 13650 provides an optional proceeding to confirm to the surviving spouse the property that belongs to the survivor.  Sample Spousal Property Petition and Spousal Property Order are attached as Exhibits JBP 8 and JBP 9.
   2. A Spousal Property Petition is filed separately from a Petition for Probate, even if they are filed at the same time.  They should have the same case number.  Different courts require different levels of proof to substantiate the claim that the property is community property.
   3. If done properly an SPP takes under two months from start to finish so is much quicker than a full probate to conduct!

PRACTICE POINTER:  A Spousal Property Petition should always be the first petition you consider when dealing with a surviving spouse. It may not work in every case and may not be the best answer but you should always consider it as it is typically the most economical way to transfer property to the surviving spouse.  If you file a full probate, without considering the use of an SPP, the Court could ask for an allegation that the use of an SPP was offered to the client before filing the full probate.

1. An Inventory and Appraisal is not required when using the SPP procedures. However, it may be done within three months of filing the SPP.
2. Pursuant to PC 13550 the surviving spouse is personally liable for certain debts of the decedent chargeable against the property as described in PC 13551.
3. Pursuant to PC 13551 the liability shall not exceed the fair market value at the date of death, less liens and encumbrances, of the decedent’s interest in the property.

F. Other miscellaneous provisions relating to surviving spouses

1.     Pursuant to PC13600 the surviving spouse may collect unpaid compensation up to $5,000 without procuring Letters by affidavit as laid out in PC 13601.

2.     Other petitions to avoid full probates may be utilized even if SPP won’t work such as Petition to determine succession to real property ($100,000 or less), 13100 declarations, etc….