MBE Rules · Community Property
Interspousal Fiduciary Duty
Cal. Fam. Code § 721; § 1100(e)
The rule
Spouses owe each other the highest good faith and fair dealing in the management of community assets. Breach may support a claim for damages, imposition of a constructive trust, or an unequal division of community property.
In plain English
Spouses are required to act in good faith and deal fairly with each other regarding community property. If one spouse breaches this duty, the other may seek damages or request a different division of the community assets.
Worked example
During their marriage, one spouse secretly sold a community asset, a family car, and kept the proceeds without informing the other. When the other spouse discovered this, they filed a claim for breach of interspousal fiduciary duty. The court ruled in favor of the aggrieved spouse, awarding damages and adjusting the division of community property.
Memory hook
Spouses must play fair with community property or face the consequences.
The trap
Exams may present scenarios where one spouse's actions seem innocuous, leading students to overlook the fiduciary duty aspect and misidentify a breach.
How examiners test it
Questions often involve fact patterns where one spouse takes unilateral action regarding community assets, testing the candidate's understanding of the fiduciary duty owed to the other spouse.
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More Community Property rules
- Management and Control of CP · Cal. Fam. Code § 1100(a)-(d)
- Equal Division at Dissolution · Cal. Fam. Code § 2550
- Putative Spouse Doctrine · Cal. Fam. Code § 2251
- Business Goodwill · Marriage of Foster (goodwill)
- Severance Pay · Severance pay (Cal.)
- Credit Acquisitions · Marriage of Grinius (lender intent)