California laws recognize that spouses owe each other fiduciary duties due to their relationship of confidence. “This confidential relationship imposes a duty of the highest good faith and fair dealing on each spouse, and neither shall take any unfair advantage of the other.” Family Code Section 721(b). Once a breach of the fiduciary duty is determined, even if the breach was inadvertent or unintentional, the court shall award the non-breaching party 50 % of the asset in dispute as well as attorney’s fees and costs. In one instance, the court found that the wife had breached her duty by withdrawing $24,000.00 in cash advances without disclosing this amount to the husband. The court ordered the wife to reimburse the husband 50% of this asset and also pay the husband’s attorney’s fees. Marriage of Fossum (2011) 192 Cal.App.4th 336.
If the breach of fiduciary is found to be intentional or committed with actual fraudulent intent, the legal ramifications are much more serious. The court may award 100% of the asset in dispute to the non-breaching spouse and has the discretion to order the breaching spouse to pay the other spouse’s reasonable attorney’s fees and costs. Family Code Section 1101(h); In re Marriage of Rossi (2001) 90 Cal.App.4th 34 (wife intentionally concealed lottery proceeds).
Most significantly, spouses may owe each other fiduciary duties even after the marriage has ended. Are you facing a similar legal battle with your current or former spouse? Call our office today for a free initial telephone consultation.
****The opinion above is not intended to be legal advice and absolutely does not create any attorney-client relationship between its author and the readers. Please consult an attorney for information or advice specific to your legal issue.****
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