(Santa Clara County Super. Ct. No. FL127770). Trial Judge: Honorable Edward J. Davila.
The opinion of the court was delivered by: McAdams, J.
CERTIFIED FOR PUBLICATION
In this marital dissolution case, the parties dispute the proper characterization of disability benefits. Prior to the marriage, the wife had purchased a private disability policy, paid all the premiums, and started collecting benefits. The trial court nevertheless treated the benefits received by the wife during marriage as community property, reasoning that they were a substitute for wages.
As a matter of first impression, we conclude that the private disability benefits paid to the wife during marriage are her separate property, because she acquired the right to those benefits before marriage without any contribution from the community. We therefore reverse.
The parties to this appeal are petitioner and appellant Belita Rossin (the wife), and respondent Richard Rossin (the husband). The parties were married in July 2000 and separated in March 2005.
In June 1991, some nine years prior to the marriage, the wife purchased a private disability insurance policy, to provide income in the event that she was disabled from working as a pediatrician. In January 1997, the wife left the practice of medicine for mental health reasons. In April 1997, she began receiving benefits under the policy in the form of monthly payments from the insurer, which continued throughout the parties' marriage. Under the terms of the policy, the wife was not obliged to pay premiums during disability. Although disabled from working as a pediatrician, the wife was self-employed during the marriage as a music teacher. According to the husband, "the parties commingled their assets and contributed their respective incomes to maintain the community home and their life style."
In July 2005, the wife brought this proceeding for dissolution of the marriage. In connection with the property division, the wife claimed the disability benefits as her separate property and sought reimbursement. The husband disputed that claim, asserting that the disability benefits received during the marriage were community property.
In September 2006, by stipulation, the dispute was submitted for decision by written briefs. In October 2006, the trial court filed a statement of decision, finding that the disability benefits received during marriage were community property. In the court's view, because they "were intended to replace or substitute for salary/wages, it necessarily follows that the disability benefits received during marriage were community property." In September 2007, the court entered its dissolution judgment and property division order, which includes the challenged characterization of the disability benefits as community property.
This timely appeal by the wife followed. The sole issue on appeal is the character of the disability benefits as separate or community property.
As a framework for our discussion, we first describe the general principles of marital property law that inform our analysis.
"California community property law is a complex amalgam of principles derived initially from Spanish law extant during early statehood." (1 Raye et al., Cal. Civil Practice: Family Law Litigation (2002), Character and Valuation of Property, § 5:4, p. 9; see also, In re Marriage of Haines (1995) 33 Cal.App.4th 277, 288-290.) "It has evolved to reflect the prevailing attitudes towards marriage and the relationship between the spouses. Three principles developed early and remain fundamental. [¶] (1) Equality of Interests. Spouses have equal ownership interests in community property. . [¶] (2) The 'Source' Doctrine. In the absence of a controlling statutory presumption to the contrary, the character of property as community or separate will be determined by the source of assets used to produce it. . [¶] (3) Alteration by Contract. Within certain public policy limits, and subject to certain formalities, the parties can agree to alter the application of community property laws to their marital property." (Raye, p. 9.)
Community property and separate property are defined in the Family Code. (Further unspecified statutory references are to that code.)
Section 760 states: "Except as otherwise provided by statute, all property, real or personal, wherever situated, acquired by a married person during the marriage while domiciled in this state is community property." Under this section, "there is a general presumption that property acquired during marriage by either spouse other than by gift or inheritance is community property unless traceable to a separate property source." (In re Marriage of Haines, supra, 33 Cal.App.4th at pp. 289-290; see also, e.g., In re Marriage of Mix (1975) 14 Cal.3d 604, 611.)
Section 770 states: "Separate property of a married person includes all of the following: [¶] (1) All property owned by the person before marriage. [¶] (2) All property acquired by the person after marriage by gift, bequest, devise, or descent. [¶] (3) The rents, issues, and profits of the property described in this section." (§ 770, subd. (a).) Our state constitution similarly provides: "Property owned before marriage or acquired during marriage by gift, will, or inheritance is separate property." (Cal. Const., Art. I, ...