Marriage Of Marsden

130 Cal.App.3d 426 (1982)

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Nature of the Case

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Facts

This rendition of the case only addresses the valuation of a leasehold. H concedes that there is a community interest in the leasehold and house. In 1962, H paid to Stanford University $6,300 for an 80-year lease of a parcel of property owned by Stanford. H had a house constructed on the property which he financed by a $2,000 cash payment and the proceeds from a $30,000 loan from Stanford. Thus, the cost of the property in 1962 was $38,300. By the time the parties were married in February 1971, H had reduced the loan by $7,000, so the outstanding balance was $23,000. During the marriage, payments from community funds further reduced the principal due on the loan by $9,200. Between the time of separation in July 1978 and trial in February 1979, H paid $655 on the principal. The fair market value (FMV) of the house and leasehold interest was $65,000 at the time of the marriage in February 1971 and $182,500 at the time of trial. The appreciation was $126,700. The difference between the equity at the time of trial ($182,500 less a loan balance of $13,800 equals $168,700) and the equity in 1971 ($65,000 less the $23,000 loan balance equals $42,000. The court allocated $71,953 as the community interest based on the ratio of separate property loan payments ($7,000 or 43.21 percent) to the community property loan payments ($9,200 or 56.79 percent). H appealed. (The trial court made a large number of mistakes in its math; we did not include them.)