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Can reimbursement for education be part of property division?

On Behalf of | Feb 10, 2022 | Divorce, Property Division

In some California marriages, one spouse will help the other gain training or skills for the future by contributing to their education. That could be done in a variety of ways. If the marriage hits rough patches and they decide to divorce, the spouse who contributed to the education and accumulation of skills might want reimbursement for that as part of property division during the case. The other may protest. There is a specific law that addresses this and those confronted with this complicated situation should be aware of it.

Community property

If the payments were made with community property or quasi-community property from the marriage, it may be subject to reimbursement. It must have been a substantial factor in the improved earning capacity of the recipient. The person who contributed will be reimbursed with interest based on legal rates from the time he or she made those contributions. If there was a loan that was taken out while the couple was married and it was for education and training, it will not be factored in when the liabilities are calculated. The party that took out the loan must pay it.

The amount can be changed or lowered if it is deemed unfair by the court. One reason for this includes both sides benefiting from the advancement that resulted from the person improving their education and skills. If their living situation was better because of the training and education and both sides were in a better circumstance because of it, then this could be important when the decision is made. If both parties received training and education, the contributions can be offset. When the education and training reduced the need for support that would be ordered as part of the divorce, then this too can result in reductions or modifications based on circumstances.

Complicated property division

Claiming the other person was helped greatly by contributions to go to school, take a training course or learn a trade and expecting to be reimbursed for that as part of the divorce is a common source of discord. This can be addressed through property division. The courts will scrutinize the case to make an assessment and decide accordingly. From either perspective, it is important to have professional guidance to try and come to a reasonable and acceptable outcome.