BILL ANALYSIS
AB 806
Date of Hearing: May 10, 1995
ASSEMBLY COMMITTEE ON JUDICIARY
Phillip Isenberg, Chair
AB 806 (Ducheny) - As Amended: May 3, 1995
KEY ISSUE: SHOULD A MUTUAL WAIVER OF THE FINAL DECLARATION OF
DISCLOSURE OF ASSETS, LIABILITIES, INCOME, AND EXPENSES BE
PERMITTED IN DISSOLUTION AND LEGAL SEPARATION PROCEEDINGS?
BACKGROUND
History. AB 1437 (Speier, 1992) established an affirmative duty
on the part of each party to a dissolution action to provide
information about marital assets and liabilities to the other
party. These disclosures are made in a preliminary declaration
and a final declaration of disclosure.
According to the author, after the passage of AB 1437, numerous
individuals contacted her regarding technical and substantive
problems regarding the disclosure process. In 1993, AB 1469
(Speier) sought to address these concerns by adjusting the time
for service of the preliminary declaration of disclosure,
eliminating the necessity of filing a final declaration of
disclosure in a summary dissolution or in a default judgment, and
providing that the final declaration of disclosure must be served
on the other party but need not be filed with the court. Other
clean-up provisions were also adopted.
Facts. The Certified Family Law Specialists Committee, San Diego
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County Bar Association (CFLSC), estimates that the cost of
preparing a final declaration of disclosure ranges from $1,000 to
$1,500 even in a modest family law case.
DIGEST
Existing law:
1) Provides that a preliminary declaration of disclosure (PDD)
shall be served upon the other party within 60 days of filing
the Petition. This declaration shall:
a) Set forth with sufficient particularity, (i) the identity
of all assets and liabilities of the declarant, and (ii)
the percentage of ownership in each asset and percentage
of obligation for each liability.
b) Be accompanied by a current Income and Expense
Declaration.
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2) Allows the parties to accelerate or delay the service of the
PDD.
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3) Requires that a final declaration of disclosure (FDD) be
served before or at the same time a final agreement is
reached, but in no case not later than 45 days before trial.
4) Requires that the FDD include all of the following:
a) All material facts and information regarding the
characterization of all assets and liabilities.
b) All material facts and information regarding the valuation
of all assets which are community or in which the
community has an interest.
c) All material facts and information regarding the amount of
obligations that are contended to be community obligations
or for which the community has liability.
d) All material facts and information regarding the earnings,
accumulations, and expenses of each party that have been
provided in the income and expense declaration.
5) Requires that the income and expense declaration be updated,
unless a current one is on file.
6) Provides that absent good cause, no judgment shall be entered
regarding property rights in a dissolution action unless each
party has executed and served a FDD and current income and
expense declaration on the other party.
This bill allows for a mutual waiver of the final declaration of
disclosure when there is a marital settlement agreement or a
stipulation in open court, so long as the PDD and the most
recently served income and expense declaration are complete.
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FISCAL EFFECT
This bill will not be referred to the Assembly Committee on
Appropriations.
COMMENTS
1) Sponsor's Statement. CFLSC states that the requirement of
completing an FDD is burdensome and costly to those parties
represented by counsel and almost impossible in the 75% of
family law cases where litigants are unrepresented. AB 806
allows for the mutual waiver of the FDD, as long as the PDD
and the most recently filed income and expense declaration are
complete. In those cases where an FDD may benefit the finder
of fact or, in the case where there is an unrepresented
litigant, there need not be a waiver.
2) State Bar, Family Law Section (Section) supports AB 806,
believing that it is the exception rather than the rule that a
party is "pressured" or "tricked" into a settlement. Although
the current code contains the
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provision that parties may waive the FDD, Section believes that
the language "absent good cause,..." is ambiguous and of little
assistance to the court.
3) Suggested Amendments. Section does not believe that a mutual
waiver of disclosure should prejudice a later request for
relief from judgment. Therefore, Section recently requested
that the bill be amended to include the following statement:
(a) "A waiver of the final declaration of
disclosure shall not be used, in any
manner whatsoever: (1) as a defense to a
motion seeking relief from a judgment
pursuant to Code of Civil Procedure
Section 472 or Family Code Sections 2120
et seq.; (2) as an act of "lack of care
or attention" within the meaning of
Family Code Section 2122(a); (3) as a
"neglect of a legal duty" within the
meaning of Civil Code Section 1577; or
(4) as an inexcusable act within the
meaning of Code of Civil Procedure
Section 473."
(b) On page 3, line 7, after "agreement", insert: " or
stipulated judgment".
(c) On page 3, line 11, after "complete", insert: "Such a
waiver shall not affect any fiduciary duties between
spouses, including the duties set forth in Family Code
Sections 721, 1100 or 1102."
4) Suggested technical amendments. On page 2, line 4; page 3,
line 14; and page 3, line 24, strike "(d)" and insert "(c)".
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Committee staff does not know if the author will accept these
recently offered amendments. Staff will continue to work with
the author to clarify the language of this bill.
SUPPORT OPPOSITION
Certified Family Law Specialists Committee,Unknown
San Diego County Bar Association (sponsor)
State Bar's Conference of Delegates
State Bar, Family Law Section, with amendments
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