Cheating on a spouse can be expensive. And it’s common for a spouse involved in marital infidelity to use community property financial resources to fund the affair. Can the cuckolded spouse get paid back on divorce?
The cheated-on spouse may want his or her attorney to argue that marital infidelity, or the financial costs of it, is a breach of fiduciary duty or a violation of a spouse’s “contract toward each other … of mutual respect, fidelity, and support.” Fam C §720. The analysis and resolution of marital infidelity-based fiduciary claims, evidence, and arguments involves the interaction of several principles of California law.
Although neither Fam C §721 nor §1100 make marital infidelity itself a breach of fiduciary duty, they do offer remedies for some common features of marital infidelity:
- A spouse who unilaterally gifts community personal property to a third party may be required to reimburse the other spouse. Fam C §§1100(b), 1101(g)–(h). The court also may set aside the gift(s) and order the third party to return the gift(s) or their value to the marital community;
- A spouse who unilaterally transfers community personal property to a third party may be required to reimburse the other spouse. Fam C §§1100(c), §1101(g)–(h);
- A spouse who conceals community property from the other spouse, or impairs a community property interest, may be subject to the remedies for concealment or impairment of community assets in Fam C §1101(g)–(h); and
- Under standard business valuation methodologies, the compensation paid to employees of a business is an expense that reduces a business’s profits and may negatively affect valuation. Nepotistic or personally interested hiring, retention, and compensation may result in sub-optimal business performance and valuation. When a business incurs unusual expenses related to infidelity (e.g., business trips that are excessive in number, location, or cost), those expenses may reduce the profitability of the business. To the extent a spouse can show that infidelity has an actual impact on business value, a family court may consider that fact in determining the value of the business.
But forget about reimbursement for a broken heart. Under CC §43.5, the “anti-heartbalm statute,” there’s no cause of action for “[a]lienation of affection,” i.e., an action against a third party for taking a spouse’s love and attention from the other spouse or “[c]riminal conversation” (seduction of a married person).
And don’t try to “camouflage an abolished action with the catchwords of the common law;” the essence of the cause of action must be more than “mere seduction.” Richelle L. v Roman Catholic Archbishop of San Francisco (2003) 106 CA4th 257, 267 (court rejected claims for breach of fiduciary duty, fraud and deceit, and intentional and negligent infliction of emotional distress).
Learn about fiduciary duties involved in family businesses and transactions in CEB’s Understanding Fiduciary Duties in Business Entities, chap 6. This title is the newest addition to CEB’s Business Law Library. For discussion of marital fiduciary duties and dissolution of marriage, turn to the titles in CEB’s Family Law Library.
Other CEBblog™ posts you may find interesting:
- Endless Summons: No Statute of Limitations on Spouse’s Claim for Breach of Fiduciary Duty
- Do Adult Children Have a Duty to Support Their Parents?
- Do Both Spouses Need to Sign Contracts?
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