Approximately three years after their marriage, Dawnel and Frank Bonvino purchased a family home in Westlake Village with a down payment from husband’s resources and the proceeds from a loan in his name. The property was purchased in 1996. Title to
the home was taken in Frank’s name as sole and separate property. Approximately 15 months later, Frank completed the sale of a property in Long Beach that he purchased prior to their marriage and used the funds from the sale to pay off the loan on the Westlake Village home. Several years later, Dawnel moved out. She filed for divorce in 2005.
The trial court found the Westlake Village home to be community property. In addition, the court awarded Frank reimbursement of his separate property contributions under Family Code §2640. The court also charged husband for the fair rental value of the home from the time Dawnel moved out to the date of judgment.
Frank appealed the decision, contending there was no evidence that he transmuted his separate property to community property. Rather, he asserted the trial court should have found that both separate and community property interests were established in the Westlake Village home proportionate to the equity in the property.
To best comprehend the results of the Superior Court regarding the determination and calculation of separate and community property value of their family home, I refer to the findings of In re the Marriage of Marcia and Lawrence Aufmuth.
Background: Computation of Separate and Community Interest in a Home: In re the Marriage of Marcia and Lawrence Aufmuth
Lawrence and Marcia Aufmuth were married in August 1967. In July 1971, the parties purchased a family home for $66,500 with a down payment of $16,500 made by Marcia from separate funds acquired before their marriage. The remaining $50,000 was paid via a real estate loan. Title to the property was taken in both names as community property. All subsequent payments and costs connected with the property were paid from community earnings.
Lawrence and Marcia separated in September 1975. They agreed at the trial that the fair market value of their home was $125,000, and that the separate and community interests would be computed on a pro rata basis in direct proportion to the amounts of separate and community funds invested in the property. (See In re Marriage of Jafeman (1972) 29Cal.App.3d 244, 256-257.)
In accordance with the agreed on method of computation, the court found that the present value of the initial down payment was $31,014 and the joint investment was $46,986. The court apparently determined the $31,014 value by adding the amount of capital appreciation attributable to separate funds (28.81 percent of $58,500) to the amount of the equity paid by separate funds ($16,500). The $46,986 amount was determined by adding the amount of capital appreciation attributable to community funds (75.19 percent of $58,500) to the amount of equity paid by community funds ($50,000 minus $47,000).
The Bonvino Property
Dawnel and Frank Bonvino purchased the Westlake Village property for $410,000. Frank made a down payment of $90,212.50. Dawnel was aware that Frank made this down payment from funds he acquired prior to their marriage.
Frank applied for a home loan of $328,000. This included $8,212.50 for closing costs. The loan application stated the title would be held in the name of Frank Bonvino, married as sole and separate property. Frank and a notary told Dawnel that due to bad credit (the result of credit card debt) she had to sign a quitclaim deed for the parties to be able to purchase the Westlake Village home. On November 15, 1996, Dawnel signed a quitclaim. The deed was recorded on December 11, 1996 from the sellers granting Frank Bonvino, a married man, sole and separate property.
Dawnel was assured by Frank he would put her name on the title as soon as they closed escrow. She trusted Frank and always assumed the house was community property. Although the intent to change title was discussed several times during the marriage, her name was never added to the title.
The monthly mortgage payments of approximately $2,600 were paid from community funds. Following the sale of Frank’s Long Beach property 15 months after the purchase of the Westlake home, the escrow company sent the proceeds from the sale directly to his bank to pay off the mortgage on the Westlake Village property.