When couples in Southern California divorce, dividing marital property is rarely a straightforward undertaking. For example, for those couples privileged enough to own an art collection, determining who gets the art in a divorce can be a contentious subject.
One might think that the law on such issues provides clarity. While it is true that California is a community property state (and, in general, all assets acquired during a marriage are subject to equal division upon divorce), not all assets enjoyed by both spouses during their marriage are necessarily divided equally in the event of a divorce.
Legal and practical concerns
For starters, separate property belongs solely to the spouse who owns it and is not divided in the event of divorce. Certain assets addressed in prenup or postnup arrangements, and property that has not been commingled (and was acquired prior to marriage, as a gift to a single spouse or an inheritance passed down to a single spouse) is generally considered to be separate property.
When it comes to art, determining whether a piece is community or separate property is the first step. Then, if a piece is community property, it needs to be accurately valued. Art can fluctuate in value, and some pieces may benefit from significant appreciation over time. In contentious divorces, spouses may disagree on the value of art, especially if it holds sentimental value or has increased in monetary worth since its purchase. To resolve these disputes, an independent appraiser specializing in fine art may be brought in to assess the value of each piece or collection. Such valuation is important when it comes to ensuring a fair division of assets.
Once the art’s value is determined, couples have several options for dividing it. One option is to sell the artwork and split the proceeds equally. This can be a practical solution, especially if the art holds significant financial value and neither spouse has a personal attachment to it. However, if one or both spouses have a strong emotional connection to the art, they may negotiate a buyout, where one spouse keeps the artwork in exchange for giving up a comparable value of other assets.
Every case is unique, which is one of the reasons why seeking legal guidance before committing to a plan of action is generally wise.