Sunday, December 21, 2008
Gather Round The Table, We'll Give You A Treat: Court Finds Stock Shares To Be Community Property Despite Title Evidence Argument In Hanukkah Case
In In re Marriage of Rosner, 2003 WL 22853006 (Cal.App. 2 Dist. 2003), Leland Rosner and Linda Sherman Rosner were married for approximately eight years before they got divorced after divorce proceedings. As a result of those proceedings, inter alia, the trial judge determined that 250 shares of Royal Dutch Petroleum stock (1,000 by the time of trial due to stock splits) was community property, prompting Leland's appeal.
And the basis for Leland's argument was that "his name and his name alone was on the gift certificate prepared by his father" which allegedly transferred the stock shares. According to Leland, this meant that the stock shares should have been considered his separate property pursuant to California Evidence Code Section 662, which states that "[t]he owner of the legal title to property is presumed to be the owner of the full beneficial title. This presumption may be
rebutted only by clear and convincing proof."
So, why did the trial judge rule against Leland? Well, the court noted a few reasons. First of all, while Leland's father claimed that he solely gave the gift certificate to Leland, Linda and her father both claimed that he gave it to Linda at a Hanukkah party and said, "Happy Hanukkah." The problem for Leland was that Linda presented to the court a photograph of her holding the envelope with the gift certificate.
Moreover, because Leland did not produce the copy of the gift certificate with only his name "until several weeks after his deposition, and had no explanation for where the document had been, the court discounted his evidence. Instead, the court credited the testimony of Linda and her father, bolstered by the photograph showing her holding the envelope."
Most importantly, however, the gift certificate merely symbolized the gift of the stock share transfer, and the transfer itself was "put directly into the couple's joint account." Therefore, California Evidence Code Section 662 actually supported the proposition that the stock shares were community property, not the proposition that the stock shares were Leland's separate property.