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When A Gift Is Not A Gift

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Another Valentine's Day has come and gone. Hopefully you received flowers and kisses, though some of you may have received more expensive gifts such as jewelry or even a new car. Most people assume a gift is a gift, but in California that is not always the case. As a divorce lawyer in California, I hate to rain on your parade, but if you received an expensive diamond necklace from your husband, the law may not treat it as a gift if you ever get divorced.

Discovering that your soon-to-be ex spouse is claiming that your Valentine's day gift was not really a gift at all is very common when a divorce turns nasty. Suddenly the gift giver and their lawyer decide that all the gifts of jewelry etc. during the marriage were not gifts; rather, they were property of the marriage.

The reason for this is that in a community property state like California, there is a presumption that all property acquired during marriage is community property and must be divided equally in the event of a divorce. Certain types of gift are an exception to this rule, but the exception is narrowly defined.

In California, gifts of jewelry and other personal items are considered separate property if they are not substantial in nature, taking into consideration the circumstances of the marriage. In other words, a $20,000 diamond ring from a millionaire would probably be considered separate property. The same diamond ring from a spouse making the median income with no other valuable assets in the marriage will probably not be considered separate. In one California divorce case, the court found that a gift of a Porsche was not an article of a personal nature, and therefore was not separate property.

Another exception is where there is something in writing that indicates a gift was intended. In California, a gift is separate property if there is a writing which expressly declares that giver intends the nature of the property to be changed from community to separate property. The legal term for such a declaration is a "transmutation." It is difficult to say whether your typical gift card would meet this standard. A hopelessly unromantic divorce lawyer in California receiving such a gift would therefore ask their spouse to append a declaration of transmutation at the bottom of the card: "Please honey, just underneath where you say, 'I love you, ___' do you mind writing, 'I give to you all and any interest I have in this diamond ring"?"