I have a client whose wife of 15 years has filed on him in California.
Facts:
a. They currently have four adopted children and she has not worked since they entered into marriage.
b. They have been separated since 2003.
c. The majority of the community property that they own is roughly $1.6M in primary and two vacation residences. There is roughly $1.3M in equity.
d. The business that the husband owns was owned prior to the marriage.
e. The husband also owns roughly $2M in commercial real estate that was his prior to marriage, with roughly $1.5M in equity.
There are two questions:
1. His parent's loaned his business $225K several years ago. My client, the husband, would like to get them paid off. With the buisiness in his name, is it most likely that he would need to do so out of his business assets and there be no mention of that asset or it's debt in the divorce decree?
2. In her filling, she has only indicated a request for separation of persanal assets and is seeking no business assets. That said, should he take equity out of each of his business properties, building and land, and purchase an annuity with an enhanced death benefit, listing his children as beneficiaries, is the actual cash value of that policy exposed in any way to a divorce decree?
Our thought is that with having had no attempt to seek any amount of equity from business assets, owned prior to the marriage, putting the assets inside of the insurance product would provide him shelter should she decide to do so. Are we thinking properly? Not sure if anything else is possible on the parental debt.
Thanks in advance for the response!
Michael
MG

