In 1998, Henry and Wilma, residents of California, married. Henry had purchased shares of stock before marriage and kept these shares in his brokerage account. The shares in the account paid him an annual cash dividend of $3,000. Henry deposited this income in a savings account held in his name alone.
In 1999, Wilma was hired by Tech Co. Wilma was induced to work for Tech Co. by the representation that successful employees would receive bonuses of company stock options. Later that year, Wilma was given options on 1,000 shares of Tech Co. stock. These stock options are exercisable in 2006, as long as Wilma is still working for Tech Co.
In 2003, because of marital difficulties, Wilma moved out of the home she had shared with Henry. Nevertheless, the couple continued to attend marriage counseling sessions that they had been attending for several months. Later that year, Henry was injured in an automobile accident. Afterwards, Henry and Wilma discontinued marriage counseling and filed for dissolution of marriage.
In 2004, Henry settled his personal injury claim from the automobile accident for $20,000. The settlement included reimbursement for $5,000 of medical expenses that had been paid with community funds.
Henry had a child by a prior marriage and, over the course of his marriage to Wilma, had paid out of community funds a total of $18,000 as child support.
- 1. When making the final property division in Henry and Wilma’s dissolution proceeding, how should the court characterize the following items:
a. Henry’s savings account? Discuss.
b. Henry’s personal injury settlement? Discuss.
c. Wilma’s stock options? Discuss.
- 2. Should the court require Henry to reimburse the community for his child support payments and, if so, in what amount? Discuss.
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