1

Filed 7/23/24 Marriage of Herrera CA1/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for 

publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or 

ordered published for purposes of rule 8.1115. 

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION THREE

In re the Marriage of MARIBEL 

HERRERA and MICHAEL 

HERRERA.

MARIBEL HERRERA,

Respondent,

v.

MICHAEL HERRERA,

Appellant.

 A162657

 (Contra Costa County

 Super. Ct. No. MSD17-04913)

This is an appeal from a judgment in a marital dissolution action 

between Maribel Herrera and Michael Herrera.1 Michael contends the trial 

court erroneously found that: (1) under the so-called “Moore-Marsden rule,”

2

the community had a pro tanto interest in real property that Michael had 

purchased before marriage; (2) the proceeds of a fire insurance policy and a 

refinancing of a separate property loan during marriage were community 

1 We use the parties’ first names for convenience, intending no 

disrespect.

2 See In re Marriage of Moore (1980) 28 Cal.3d 366 (Moore) and In re 

Marriage of Marsden (1982) 130 Cal.App.3d 426 (Marsden).
2

property; and (3) the community was entitled to so-called Watts charges3 for 

Michael’s occupation of the marital residence between the date of separation

and closing arguments. We affirm the judgment.

FACTUAL AND PROCEDURAL BACKGROUND

In August 1994, prior to the parties’ marriage, Michael purchased real 

property located on Paul Scarlett Drive in Concord (hereafter the Property)

for $186,000 and made payments on the mortgage from his separate property 

earnings. Maribel came from the Philippines in 1996, and the parties were 

married in August 1996. They lived at the Property during the marriage. At 

all relevant times, title to the Property remained solely in Michael’s name. 

In February 1999, Michael submitted an application to refinance the 

mortgage on the Property. In his application, Michael identified his 

employment earnings and listed the Property and various bank accounts and 

vehicles as assets. He also indicated that title to the Property would be held 

as his sole and separate property as a married man. 

At trial, Michael testified he was told by a loan officer that the lender 

wanted to have Maribel’s name on the loan, but Maribel refused to cosign the 

loan. Michael told Maribel that in order to not be on the loan, she would 

have to sign an interspousal transfer grant deed (ITGD). Michael testified 

that Maribel “chose to sign” the ITGD, and that “it was explained in full 

detail by Helen Stone,” a close friend of Michael’s who witnessed Maribel’s 

signing of the ITGD. 

The ITGD stated in relevant part: “ON March 16, 1999, FOR A 

VALUABLE CONSIDERATION, receipt of which is hereby acknowledged

Maribel Herrera, wife of the grantee hereby GRANT(S) to Michael O. 

Herrera, a married man as his sole and separate property the real property 

3 See In re Marriage of Watts (1985) 171 Cal.App.3d 366 (Watts).
3

in the City of CONCORD, County of Contra Costa, State of California, 

described as: Lot 73, Map of Subdivision 2989, filed January 5, 1962, in Map 

Book 85, Page 37, Contra Costa County Records. It is the intention of the 

grantor herein to relinquish all of her right, title and interest, whether 

community property or otherwise, in and to the hereinabove described 

property and to vest said property in the above grantee as his separate 

property.” (Some boldface type omitted.) 

Maribel testified that Michael “told me to sign the deed” because he 

“need[ed] to refinance the house and buy a vehicle” for his work commute, 

and that at the time, “when I signed, I feel pressured.” Maribel said she 

received no money or anything else in exchange for signing the ITGD, and 

that when she signed it, she had not heard of a Moore/Marsden calculation 

and did not know that she had any interest in the Property. Maribel read 

and signed the ITGD “quick[ly]” because she trusted that Michael would 

“take care of our finances. I don’t have a job. I’m taking care of our first 

child.” Maribel further explained, “And if I don’t sign it, what’s my choices 

here? I will end up paying the mortgage if something happens to him. And I 

don’t know anything about this Moore-Marsden. I don’t have no knowledge 

about loans and properties. I was just there for Michael to support him on 

whatever we need. Then I sign it.” Maribel testified she understood the 

effect of the ITGD was that she would not be responsible for the refinance 

loan. 

The mortgage on the Property was successfully refinanced in March 

1999. 

Thereafter, in October 1999, a malfunctioning stove caused a fire that 

damaged the Property. Michael maintained a fire insurance policy he had 

purchased at the time of refinancing, and he paid the premiums on the policy 
4

from his employment earnings. The fire insurance proceeds were used to 

purchase appliances and materials to “essentially rebuil[d] the entire home.” 

Michael testified the remaining $150,000 in proceeds were placed in various 

bank accounts, including a joint account shared with Maribel, and separate 

IRA accounts for each of them. 

The refinanced mortgage was paid off in June 2015. All payments on 

the refinanced mortgage were made with Michael’s earnings. 

The parties separated on October 10, 2017, and Maribel filed a petition 

for dissolution of marriage on October 20, 2017. Trial was held on various 

dates in August and September 2019. The trial court heard testimony from 

Maribel, Michael, Brandon Carpenter (Maribel’s forensic accounting expert), 

and Tom Blair (the court’s appraisal and valuation expert). The parties 

submitted written closing arguments on January 19, 2021. 

In March 2021, after issuing a proposed statement of decision and 

receiving Michael’s objections thereto, the trial court issued its final 

statement of decision finding in favor of Maribel on all issues. The court 

found, in relevant part, that although the Property was Michael’s separate 

property, the community had a pro tanto interest in it under the MooreMarsden rule because community property funds (Michael’s earnings during 

marriage) had been used to pay down the debt. In so concluding, the court 

rejected Michael’s arguments that the Moore-Marsden rule had been 

abrogated or superseded by statute, and that Maribel had waived her share 

of the community interest by executing the ITGD. The court further found 

the ITGD did not transmute the community’s interest in the Property into 

Michael’s separate property because Michael did not rebut the legal 

presumption of undue influence that arises whenever there is a transfer from 

one spouse to another that gives one spouse an unfair advantage. 
5

The trial court further determined the loan proceeds from the 1999 

refinancing were community property because Michael did not overcome the 

presumption that proceeds from a loan incurred during marriage are 

presumed to be community property. Specifically, Michael did not 

demonstrate the lender relied solely on his separate property when it 

approved the loan. The court also found the fire insurance proceeds were 

community property because the policy was purchased with community 

funds. The court then concluded the community was entitled to Watts 

charges for Michael’s sole occupation of the Property between the date of 

separation and the parties’ submission of closing arguments. 

Based on the calculations prepared by forensic accounting expert 

Carpenter, the trial court apportioned the interests in the Property as 29.08 

percent Michael’s separate property and 70.92 percent community property. 

The court further concluded, based on the then-current appraisal value of the 

Property of $615,000, that Michael’s total interest in the Property was 

$396,927.50 ($218,072.50 for his share of the community interest plus

$178,855.00 for his separate property interest), and Maribel’s share of the 

community interest in the Property was $218,072.50. The court additionally 

found, based on the Property’s fair rental value of $3,200 per month and the 

community’s 70.92 percent interest, that Michael owed $42,560 in Watts 

charges to Maribel for his 28 months of postseparation occupation of the 

Property. In total, the court ordered Michael to make an equalizing payment 

to Maribel of $260,632.50. 

This appeal followed. 

DISCUSSION

“In a marital dissolution proceeding, a court’s characterization of the 

parties’ property—as community property or separate property—determines 
6

the division of the property between the spouses. [Citations.] Property that a 

spouse acquired before the marriage is that spouse’s separate property. 

(§ 770, subd. (a)(1).) Property that a spouse acquired during the marriage is 

community property (§ 760) unless it is (1) traceable to a separate property 

source [citations], (2) acquired by gift or bequest (§ 770, subd. (a)(2)), or 

(3) earned or accumulated while the spouses are living separate and apart 

(§ 771, subd. (a)). A spouse’s claim that property acquired during a marriage 

is separate property must be proven by a preponderance of the evidence.” (In 

re Marriage of Valli (2014) 58 Cal.4th 1396, 1399–1400 (Valli).)

“ ‘The trial court’s findings on the characterization and valuation of 

assets in a dissolution proceeding are factual determinations which are 

reviewed for substantial evidence.’ ” (In re Marriage of Wozniak (2020) 59 

Cal.App.5th 120, 130 (Wozniak).) “[W]e examine the evidence in the light 

most favorable to the prevailing party and give that party the benefit of every 

reasonable inference. [Citation.] We accept all evidence favorable to the 

prevailing party as true and discard contrary evidence.” (In re Marriage of 

Drake (1997) 53 Cal.App.4th 1139, 1151.)

A. The Rebuttable Presumption of Undue Influence in 

Interspousal Transfers that Unfairly Advantage One Spouse

Michael contends the trial court erred in applying a rebuttable 

presumption of undue influence to Maribel’s execution of the ITGD. In 

particular, he asserts this principle was impliedly abrogated in 1985 when 

the transmutation statutes (§§ 850–853) became effective. We disagree and

conclude substantial evidence supported the court’s finding that Michael 

failed to rebut the presumption of undue influence.

As relevant here, the transmutation statutes provide that “married 

persons may by agreement or transfer, with or without consideration, . . . 

[¶] . . . [t]ransmute community property to separate property.” (Fam. Code, 
7

§ 850, subd. (a).)4 “A transmutation of real or personal property is not valid 

unless made in writing by an express declaration that is made, joined in, 

consented to, or accepted by the spouse whose interest in the property is 

adversely affected.” (§ 852, subd. (a).)

Here, it was undisputed that Maribel signed the ITGD, which 

unambiguously “grant[ed]” to Michael as his “sole and separate property” any 

right, title, and interest, “whether community property or otherwise,” that 

Maribel had in the Property. Substantially identical language was found to 

satisfy section 852’s writing requirement in In re Marriage of Kushesh & 

Kushesh-Kaviani (2018) 27 Cal.App.5th 449, 454–455 (Kushesh).

Significantly, compliance with the statutory writing requirement is 

simply “a prerequisite to a valid transmutation” and “does not necessarily 

determine whether a valid transmutation occurred.” (In re Marriage of Lund 

(2009) 174 Cal.App.4th 40, 55 (Lund).) It is well-settled that “whenever there 

is a transfer from one spouse to another a rebuttable presumption of undue 

influence arises if the transaction gives one spouse an unfair advantage over 

the other.” (Kushesh, supra, 27 Cal.App.5th at p. 456, citing In re Marriage 

of Burkle (2006) 139 Cal.App.4th 712, 732 (Burkle).) “Generally, a spouse 

obtains an advantage if that spouse’s position is improved, he or she obtains a 

favorable opportunity, or otherwise gains, benefits, or profits.” (In re 

Marriage of Mathews (2005) 133 Cal.App.4th 624, 629 (Mathews).) 

“[N]umerous cases apply the presumption of undue influence when the 

marital transaction is one in which one spouse deeds his or her interest in 

community property to the other spouse, for no consideration or for clearly 

inadequate consideration. [Citations.]” (Burkle, at p. 731.) In cases where 

property transfers are made without consideration, one spouse “obtains a 

4 Further unspecified statutory references are to the Family Code.
8

benefit at the expense of the other, who receives nothing in return,” and this 

“may be reasonably characterized as a species of unfair advantage.” (Burkle, 

at p. 731.) The presumption of undue influence stems from the fiduciary 

relationship between spouses expressly described in section 721 as it relates 

to interspousal transactions. (Id. at p. 729.)5

Michael does not dispute that he benefited from the ITGD, or that 

Maribel was disadvantaged by it. Nor does he contend the plain language of 

the transmutation statutes expressly eliminates the presumption of undue 

influence. Instead, noting that the presumption dates back to a bygone era 

when husbands had management and control over community property and 

could easily obtain oral transmutations of property, Michael asserts the

enactment of section 852’s writing requirement necessarily and impliedly

abrogated this historical presumption. We are unpersuaded.

“In the absence of express statutory provision, courts will not find an 

implied abrogation of long established principles.” (Williams v. Los Angeles 

Metropolitan Transit Authority (1968) 68 Cal.2d 599, 603 (Williams); see 

People v. Nilsson (2015) 242 Cal.App.4th 1, 18 (Nilsson).) Notably, case law 

has long recognized and applied the rebuttable presumption of undue 

5 Section 721, subdivision (b), states in relevant part that the 

confidential relationship between spouses “imposes a duty of the highest good 

faith and fair dealing on each spouse, and neither shall take any unfair 

advantage of the other. This confidential relationship is a fiduciary 

relationship subject to the same rights and duties of nonmarital business 

partners, as provided in Sections 16403, 16404, and 16503 of the 

Corporations Code.” These include, but are not limited to, the duties to 

provide a spouse access to books and records for inspection and copying; to 

render upon request true and full information of all things affecting any 

transaction that concerns community property; and to provide an accounting 

of any benefit or profit derived from any transaction by one spouse without 

the other’s consent concerning community property. (§ 721, subd. (b)(1)–(3).)
9

influence in California. (See Brewer v. Simpson (1960) 53 Cal.2d 567, 589; 

Weil v. Weil (1951) 37 Cal.2d 770, 788 (Weil); In re Estate of Cover (1922) 188 

Cal. 133, 143–144; Dimond v. Sanderson (1894) 103 Cal. 97, 102.) Then in 

1984, former Civil Code section 5103 (now Family Code section 721), “which 

expressly defines the fiduciary duties of spouses in transactions with each 

other” (Burkle, supra, 139 Cal.App.4th at p. 730), codified the principle.

Even after former Civil Code section 5110.730 (now section 852) was 

enacted in 1984 to overrule case law allowing oral transmutations between 

spouses (Cal. Law Revision Com. com., 29C pt. 2 West’s Ann. Fam. Code 

(2020 ed.) foll. § 852, p. 167), courts have continued to apply the presumption 

of undue influence in cases involving facially uneven interspousal 

transactions. (See, e.g., Valli, supra, 58 Cal.4th at p. 1411 [“The presumption 

of undue influence exists to protect married persons”]; Kushesh, supra, 27 

Cal.5th at p. 456;6 Lund, supra, 174 Cal.App.4th at p. 55; In re Marriage of 

Balcof (2006) 141 Cal.App.4th 1509, 1519–1520; Burkle supra, 139

Cal.App.4th at p. 729; Mathews, supra, 133 Cal.App.4th at pp. 628–629; In re 

Marriage of Haines (1995) 33 Cal.App.4th 277, 287.) This is consistent with 

the legislative history of former Civil Code section 5110.730, which contained

no indication of a legislative intent to overrule the long line of Supreme Court 

and Court of Appeal decisions applying the rebuttable presumption to various

interspousal transfers.

Likewise, Michael’s implied abrogation theory finds no support in the 

Legislature’s enactment of the Family Code in 1992. The transmutation 

requirements, previously codified at former Civil Code sections 5110.710 to 

6 Kushesh recognized the rebuttable presumption of undue influence but 

remanded the issue to the trial court for determination in the first instance. 

(Kushesh, supra, 27 Cal.App.5th at p. 456.)
10

5110.740, “were moved, without substantive change, to Family Code sections 

850 to 853.” (In re Brace (2020) 9 Cal.5th 903, 927–928.) And section 721, 

which codified the rebuttable presumption of undue influence (Burkle, supra, 

139 Cal.App.4th at p. 729), continued former Civil Code section 5103 “without 

change” except for substituting gender neutral phrasing. (Cal. Law Revision 

Com. com., 29C pt. 1 West’s Ann. Fam. Code (2020 ed.) foll. § 721, p. 373.) 

Though the Legislature presumably was aware of section 721 and the many 

decisions applying the presumption of undue influence when it legislated in 

1992, it appears the Legislature did not view the transmutation statutes as

altering or abrogating this principle. (See People v. Ledesma (1997) 16 

Cal.4th 90, 100–101.)

Contrary to Michael’s suggestion, the transmutation statutes and the 

rebuttable presumption of undue influence are not so “mutually exclusive” as 

to suggest the latter has been impliedly abrogated by the former. (Nilsson, 

supra, 242 Cal.App.4th at p. 18.) The transmutation statutes were enacted 

“[t]o solve the problem of unreliable evidence in transmutation cases.” (In re 

Marriage of Bonvino (2015) 241 Cal.App.4th 1411, 1428 (Bonvino).) 

Specifically, the statutes aimed to address the “allure of easy 

transmutations,” which “had encouraged extensive litigation by allowing 

spouses to ‘ “transform a passing comment into an ‘agreement’ or even to 

commit perjury by manufacturing an oral or implied transmutation.” ’ ”

(Kushesh, supra, 27 Cal.App.5th at p. 453.) But public policy concerns about 

unreliable evidence are discernibly distinct from concerns of undue influence 

among spouses in interspousal property transfers, which are not adequately 

assuaged by the mere existence of a writing. Indeed, a spouse may still, 

through duress, undue influence, fraud, or other breaches of their fiduciary 
11

obligations, cause the other spouse to execute a writing that satisfies section 

852.

Michael argues that continued application of the rebuttable 

presumption of undue influence will render written transmutation 

agreements meaningless. We disagree. In order for the presumption to 

apply, there must first be a threshold showing that a spouse has obtained an 

unfair advantage over the other. On this score, “a mere benefit is not enough; 

the advantage must operate ‘to the disadvantage’ of the other spouse.” (See

Burkle, supra, 139 Cal.App.4th at pp. 731, 735–736 [no unfair advantage 

where parties obtained mutually agreeable advantages and grantor spouse

was advised by attorneys when executing the agreement].) Furthermore, the 

grantee spouse retains the opportunity to rebut the presumption by 

demonstrating the transfer was freely and voluntarily made, with full 

knowledge of the facts and a complete understanding of the effect of the 

transaction. (See, e.g., Mathews, supra, 133 Cal.App.4th at p. 632 [husband 

who entrusted wife with all financial matters and relied on her judgment and 

management successfully rebutted presumption that wife’s quitclaim deed to 

husband was due to undue influence]; Weil, supra, 37 Cal.2d at pp. 787–789 

[wife’s deed to husband was voluntary where she was aware that spousal

interests were in conflict and she had ample opportunity to obtain 

independent advice].) In short, application of the presumption does not make 

the invalidity of written transmutation agreements a foregone conclusion.

Highlighting that section 721 was amended in 2002 to include language 

stating the confidential relationship between spouses “is a fiduciary 

relationship subject to the same rights and duties on nonmarital business 

partners,” Michael next contends the presumption of undue influence should 

no longer be applied because there is no law applying such a presumption
12

when a business partner is able to obtain an advantage over a partner after 

full and complete disclosure. We again are unconvinced. Far from equalizing 

the relationships between spouses to the relationships of business partners 

for all purposes, section 721 expressly emphasizes that spouses are entitled 

to the “highest” standard of good faith and fair dealing between them (§ 721, 

subd. (b)) and, similar to nonmarital business partners, are entitled access to

records and financial information of the community (§ 721, subd. (b)(1)–(3)). 

(See fn. 4, ante). This conferral of rights in no way suggests the wholesale 

abrogation of other legal presumptions specifically applicable to spouses 

under the law.

Having rejected Michael’s theory of implied statutory abrogation, we 

now turn to his alternative argument that the trial court erroneously found 

he failed to rebut the presumption. We conclude substantial evidence 

supported the court’s decision.

“When a presumption of undue influence applies to a transaction, the 

spouse who was advantaged by the transaction must establish that the 

disadvantaged spouse’s action ‘was freely and voluntarily made, with full 

knowledge of all the facts, and with a complete understanding of the effect of’ 

the transaction.” (Burkle, supra, 139 Cal.App.4th at pp. 738–739.) This is a 

question of fact that will not be reversed on appeal if supported by 

substantial evidence. (Id. at p. 737.)

Here, Maribel’s testimony provided substantial evidence that she felt 

significant pressure to sign the ITGD because Michael “told” her to sign it, 

and that she felt she had no choice because she was unemployed at the time 

and could not repay the loan if Michael became unable to do so. Although 

Michael disputed that he told Maribel to sign the ITGD, the court evidently 
13

credited Maribel’s testimony over Michael’s, and we are bound by that 

credibility determination. (Wozniak, supra, 59 Cal.App.4th at p. 131.)

Substantial evidence also supports the trial court’s implied finding that 

Michael failed to demonstrate Maribel executed the ITGD with “full 

knowledge of all the facts, and with a complete understanding of the effect of’ 

the transaction.” (Burkle, supra, 139 Cal.App.4th at pp. 738–739.) Maribel 

specifically testified she did not have full knowledge of the fact that she had a 

community share in the Property. True, the ITGD indicated Maribel’s 

general relinquishment of any right or interest “whether community property 

or otherwise,” but the court could reasonably have determined that Maribel 

was led to believe the purpose of the ITGD was simply to insulate her from 

responsibility on the loan. There was no evidence that Maribel was afforded 

an opportunity to obtain independent advice about the ITGD or its legal 

effect on her community property interests. And Michael did not testify that 

he explained the complete legal effect of the ITGD; he simply testified that he 

relayed the lender’s instruction that Maribel had to execute the ITGD if she 

did not want to cosign the loan. Despite Michael’s claim that the ITGD “was 

explained in full detail” to Maribel by his close friend, Stone, there was no 

specific testimony that Stone explained the complete legal effect of the ITGD 

as it related to Maribel’s share of community property. Thus, the court could 

reasonably have concluded that Michael’s conclusory testimony was 

insufficient to demonstrate Maribel’s full knowledge and complete 

understanding of all relevant facts.

In sum, substantial evidence supported the trial court’s finding that 

Maribel did not freely execute the ITGD with full knowledge of the facts and 

a complete understanding of the document’s legal effect.
14

Lund, supra, 174 Cal.App.4th 40, does not support Michael’s contention 

that the language of the ITGD alone was sufficient to rebut the presumption 

of undue influence in this case. In Lund, the Court of Appeal concluded that 

an attestation clause in a transmutation agreement stating the husband had 

carefully read and understood and agreed with all of the provisions of the 

agreement “served to rebut the presumption that [the husband] did not 

understand the legal import of the agreement.” (Lund, at p. 56.) But in so 

concluding, the court emphasized there was “no other evidence in the record 

to weigh,” since none of the testimony went to the husband’s understanding 

of the legal effect of the agreement. (Ibid.) Here, in contrast, there was other 

evidence to weigh—namely, Maribel’s testimony that she was led to believe 

the legal effect of the ITGD was simply to ensure she bore no responsibility 

for the loan. On these facts, Lund does not control.

Finally, Michael argues that because Maribel never brought an action 

against him for breach of contract or fiduciary duty within the applicable 

statutes of limitations, Maribel “is barred by law from making a claim to set 

aside the ITGD, whether due to alleged undue influence or otherwise.” But 

Michael cites no authority requiring a spouse to file such actions as a 

prerequisite for application of the rebuttable presumption of undue influence 

in a later marital dissolution proceeding. “The absence of cogent legal 

argument or citation to authority allows this court to treat the contention[] as 

waived.” (In re Marriage of Falcone & Fyke (2008) 164 Cal.App.4th 814, 830.)

For these reasons, we conclude the trial court did not err in concluding 

that Michael failed to rebut the presumption of undue influence.

B. The Moore-Marsden Rule

“When community property is used to reduce the principal balance of a 

mortgage on one spouse’s separate property, the community acquires a pro 
15

tanto interest in the property. [Citations.] This well-established principle is 

known as ‘the Moore/Marsden rule.’ ” (Bono v. Clark (2002) 103 Cal.App.4th 

1409, 1421–1422 (Bono), citing Moore, supra, 28 Cal.3d at pp. 371–372 and 

Marsden, supra, 130 Cal.App.3d at pp. 436–440.) “The term ‘pro tanto’ 

means ‘[t]o that extent; for so much; as far as it goes.’ ” (City of Huntington 

Beach v. Becerra (2020) 44 Cal.App.5th 243, 265, citing Black’s Law Dict. 

(11th ed. 2019) p. 1478.) Thus, the Moore-Marsden rule gives a non-titled 

spouse a beneficial interest in the titled spouse’s separate property “to the 

extent” or “for so much as” community property payments were used to 

reduce the principal balance of the mortgage.

“[I]n order to determine the separate property interest in the property, 

the court divide[s] the separate property contributions (down payment and 

loan amount minus amount by which community property payments reduced 

principal balance of loan) by the purchase price of the property; to determine 

the community property interest, the court divide[s] the amount by which 

community property payments reduced the principal by the purchase price. 

[Citation.] The community and separate property percentages [are] then 

multiplied by the total appreciation of the property during marriage to 

calculate the respective financial interests.” (In re Marriage of Branco (1996) 

47 Cal.App.4th 1621, 1626 (Branco).)

In addition to receiving its share of the appreciation of the property, the 

community is also reimbursed for its loan payments. (See Marsden, supra, 

130 Cal.App.3d at pp. 439–440 [calculation included community’s $9,200 in 

loan payments plus community’s 24.02 percent share of appreciation].)

The Moore-Marsden rule applies where, as here, the parties have 

refinanced a separate property mortgage during marriage and used the 

proceeds from the community loan to pay off the preexisting separate loan
16

and where community assets are used to pay off the new loan. As one court 

explained, there appears “no meaningful difference, for purposes of 

determining whether the community acquires an interest in real property, 

between the use of community funds to make payments on one spouse’s 

preexisting loan and the use of proceeds from a community property loan to 

pay off the preexisting separate loan.” (Branco, supra, 47 Cal.App.4th at 

pp. 1627.) 

Michael contends the trial court erred in determining that the 

community had a Moore-Marsden interest because Maribel waived her 

interest by executing the ITGD. In support, Michael urges us to follow In re 

Marriage of Stoner (1983) 147 Cal.App.3d 858 (Stoner). There, a wife 

purchased a residence with a down payment from separate property funds 

and a loan taken as a separate obligation. Although community funds were 

later used to make loan payments, Stoner held that the husband had 

transmuted his community interest by executing a quitclaim deed at the time 

the loan was obtained, and that the use of community funds to repay the 

loans was a gift to the community. (Stoner, at pp. 863–864.) Recognizing 

under Moore that “[t]he logical presumption . . . is that the loan, as originally 

secured, was community property in its character” and that “the community 

has a pro tanto interest in such property,” Stoner held that “[t]his 

presumption was, of course, rebutted by the quitclaim deed executed by 

husband and the community obtained no interest.” (Stoner, at p. 864, italics 

omitted.)

This portion of Stoner was criticized in Branco, which held the MooreMarsden rule “is not a presumption that can be rebutted but a rule to be 

applied when community funds are used to acquire a residence by reducing 

the principal owed on the loan by which the property was purchased.” 
17

(Branco, supra, 47 Cal.App.4th at pp. 1628–1629.) We need not weigh in on 

this dispute, as Stoner did not involve the issue of undue influence, and the 

quitclaim deed in that case was found to have effectuated a valid 

transmutation of the husband’s community property interest. (Stoner, supra, 

147 Cal.App.3d at pp. 863–864.) Here, as we have discussed, substantial 

evidence supports the trial court’s finding that Michael failed to rebut the 

presumption of undue influence in Maribel’s execution of the ITGD, 

rendering the ITGD ineffective to transmute Maribel’s share of the 

community interest. In sum, this case is materially distinguishable from 

Stoner.

Michael further contends the Moore-Marsden rule has been impliedly 

abrogated by the “reimbursement statutes,” which he identifies as sections 

902, 903, 920, 930, and 931.7 According to Michael, Maribel had only a 

section 920 right to reimbursement of her share of the community funds used 

to pay down Michael’s separate property loan that was refinanced during 

marriage, not a percentage share of the appreciated value of the Property 

during marriage. We disagree.

To reiterate, courts will not find an implied abrogation of wellestablished law in the absence of an express statutory provision. (Williams, 

supra, 68 Cal.2d at p. 603.) Nothing in the language or legislative history of 

the reimbursement statutes indicates an intent to abrogate Moore or 

7 Briefly, section 902 defines “ ‘[d]ebt’ ” as “an obligation incurred by a 

married person before or during marriage, whether based on contract, tort, or 

otherwise.” Section 903 addresses the timing of when a debt is incurred in 

cases of contracts, torts, or other obligations. Section 930 states the part in 

which it appears applies to all debts enforced on or after January 1, 1985, 

regardless of when the debt was incurred. Section 931 states the provisions 

of the part in which it appears apply to the reimbursement of all debts, 

regardless of whether satisfied on, before, or after January 1, 1985.
18

Mardsen or their progeny.

8 Indeed, the Moore-Marsden rule is a “wellestablished principle” of family law (Bono, supra, 103 Cal.App.4th at p. 1422), 

and we must assume the Legislature was aware of the rule and its

recognition of not only the community’s right to reimbursement of community 

funds used to pay down the debt on a spouse’s separate property, but also the 

community’s pro tanto interest in the appreciated value of the property 

during marriage. That section 920 mentions only the right to reimbursement 

is not reasonably construed as an implied abrogation of the remainder of the 

Moore-Marsden rule. To the contrary, “ ‘[w]hen a rule is so long ingrained in 

the public policy of the state it must be presumed that the legislature took it 

for granted rather than sought to alter it in omitting any specific provision 

for its application.’ ” (Williams, supra, 68 Cal.2d at pp. 603–604 citing 

Garvey v. Byram (1941) 18 Cal.2d 279, 281.)

Attempting to avoid this conclusion, Michael maintains the holdings of 

Moore and Marsden were not described as a “rule” until In re Marriage of 

Allen (2002) 96 Cal.App.4th 497, and thus, it was not necessary for the 

Legislature in 1992 to “specifically contemplate any ‘rule’ associated with 

Moore nor Marsden nor have a need to specifically ‘abrogate’ said rules.” This 

is simply incorrect. Moore itself recognized that it was applying a “ ‘rule

developed through decisions in California giv[ing] to the community a pro 

tanto community property.” (Moore, supra, 28 Cal.3d at p. 371, italics 

added.) And other decisions predating the 1992 enactment of the Family 

Code recognized that Moore and Marsden articulated a “rule” or “formula” to 

be applied in similar cases. (See In re Marriage of Hebbring (1989) 207 

8 Section 920, enacted in 1992, continued former Civil Code Section 

5120.210 (added by Stats. 1984, ch. 1671, § 9) without substantive change. 

(Cal. Law Revision Com. com., 29C pt. 2 West’s Ann. Fam. Code (2020 ed.) 

foll. § 920, p. 239.)
19

Cal.App.3d 1260, 1268 [“Moore-Marsden formula”]; In re Marriage of Gowdy 

(1986) 178 Cal.App.3d 1228, 1233 [describing “pro tanto interest rule” of 

Moore and earlier cases]; In re Marriage of Frick (1986) 181 Cal.App.3d 997, 

1008 [same].)

In short, the Moore-Marsden rule is alive and well, and the trial court 

correctly applied it to determine that the community had a pro tanto interest 

in the Property.

9

C. Characterization of Fire Insurance Proceeds

Michael contends the trial court erred in characterizing the fire 

insurance proceeds as community property based on the payment of 

premiums from community funds. This contention fails.

“[T]he general rule is that insurance proceeds retain the same 

character as the premium paid.” (Estate of Nereson (1987) 194 Cal.App.3d 

865, 873 (Nereson), citing Grimm v. Grimm (1945) 26 Cal.2d 173, 175

[because all premiums were paid with community funds, “the policy was 

therefore community property at the time of the property settlement 

agreement”]; see Valli, supra, 58 Cal.4th at pp. 1400–1406 [rejecting wife’s 

argument that life insurance policy purchased by husband with community 

property funds during marriage was transmuted to wife’s separate property 

due to husband’s act of placing policy solely in wife’s name].)

Here, the trial court found the fire insurance policy was purchased with 

community property funds, and Michael does not contend this finding lacked 

substantial evidence. Instead, Michael maintains the court’s reliance on 

Nereson was misplaced because in that case, the community residence 

9 Michael does not challenge the trial court’s determination of the 

community’s and Michael’s separate property interests based on Carpenter’s 

calculations and testimony.
20

repaired with fire insurance proceeds became the surviving husband’s 

separate property after the wife predeceased him, and its status as a 

community asset “was only later resurrected” because the husband died 

intestate, allowing the wife’s heirs to assert statutory heirship under Probate 

Code section 229. This is a distinction without a difference. As relevant 

here, Nereson held that fire insurance proceeds were not community property 

after the surviving husband’s death because, among other things, the wife’s 

heirs did not establish a community property source for the premium. 

(Nereson, 193 Cal.App.3d at p. 873.) Here, it is undisputed that community 

funds were used to pay the fire insurance premiums.

Michael further contends the trial court’s conclusion is undermined by 

a statement in In re Marriage of Burwell (2013) 221 Cal.App.4th 1 (Burwell)

that the proceeds of a term life insurance policy “belong to whomever the 

insurance company is contractually obligated to pay.” (Burwell, at p. 19.) 

From this, Michael concludes that because the fire insurance checks were 

issued to him as the titled owner of the Property, the proceeds had to be 

characterized as his separate property. We find no merit in Michael’s 

application of Burwell to the instant facts.

Burwell involved the complexities of characterizing term life insurance 

proceeds when an insured (1) became medically uninsurable during a term of 

coverage paid for by the community; (2) died after separation during a new 

term of coverage paid for by the separate estate; but (3) was only able to 

maintain coverage during the final term by “appropriat[ing] a community 

asset”—e.g., a contractual right to renewal or cap on premiums obtained 

during a prior term of coverage paid for by the community. (Burwell, supra, 

221 Cal.App.4th at p. 21.) The remark that Michael lifts from Burwell 

(“proceeds belong to whomever the insurance company is contractually 
21

obligated to pay”) was part of the court’s explanation that the community is 

technically not entitled to payment of proceeds when the insured’s separate 

estate pays the final coverage term. (Burwell, at p. 19.) But Burwell

recognized that “the characterization of the proceeds as separate or 

community ‘will depend on the . . . premium for the final term of the policy,’ ” 

and that the community “must be reimbursed to the extent it owns or has an 

interest in the contractual rights used by the separate estate to obtain the 

final coverage term” (e.g., right of renewal, premium caps). (Id. at p. 20.) In 

short, Burwell does not alter the general rule that the character of insurance 

proceeds is the same as the character of the premiums; it just considers the 

additional matter of whether the community is entitled to reimbursement for 

certain contractual rights peculiar to term life insurance. Those 

considerations do not apply here.

Still, Michael argues that because fire insurance is subject to 

mandatory renewal under the Insurance Code, “[i]t is the insured’s 

abstinence from certain acts that assures a right of renewal of the property 

insurance” and thus, “the community can contribute nothing to secure a 

contractual right of renewal.” (Italics omitted.) But the right of renewal is 

beside the point; the pivotal question is whether the community has 

contributed to the payment of premiums for an applicable term of coverage. 

If, as here, community funds were used to pay the premiums on a fire 

insurance policy, the character of those funds determines the character of the 

proceeds. (Nereson, supra, 194 Cal.App.3d at p. 873; see Burwell, supra, 221 

Cal.App.4th at p. 24 [“[t]he proceeds are entirely community when the final 

premium is paid solely with community property”].)

Finally, Michael claims the trial court erred in finding that the 

community had an interest in the fire insurance proceeds because Maribel 
22

admitted to being the proximate cause of the fire, and it is “antithetical” to 

negligence law to “reward a tortfeasor for his or her negligence that has 

resulted in injury to the property of another party.” Because Michael fails to 

adequately support this contention with supporting authority and argument, 

we treat the issue as forfeited. (In re Marriage of G.C. & R.W. (2018) 23 

Cal.App.5th 1, 18, fn. 16.)

For these reasons, we conclude the trial court did not err in 

determining that the fire insurance proceeds were community property.

D. Characterization of Loan Proceeds

“Loan proceeds acquired during marriage are presumptively 

community property; however, this presumption may be overcome by showing 

the lender intended to rely solely upon a spouse’s separate property and did 

in fact do so. Without satisfactory evidence of the lender’s intent, the general 

presumption prevails.” (In re Marriage of Grinius (1985) 166 Cal.App.3d 

1179, 1187; see Bonvino, supra, 241 Cal.App.4th at p. 1423 [presumption that 

loan proceeds acquired during marriage are community property “can be 

rebutted by showing the lender intended to rely on the spouse’s separate 

property alone.”].)

The trial court found Michael failed to meet his burden of proving that 

the lender relied solely on his separate property in refinancing the loan in 

1999. We see no error. The sole evidence Michael offered to prove the 

lender’s intent was the loan application he completed for the refinance. The 

application form provided an area for listing assets and liabilities and stated 

that the schedules could be completed jointly by both married and unmarried 

coborrowers if their assets were joined; “otherwise separate Statements and 

Schedules are required.” On Michael’s application, a box was checked 

indicating that the statement was completed “Jointly,” which could have 
23

suggested to the lender that the listed assets were not his separate property. 

Although Michael clarified in his testimony at trial that the bank accounts 

were solely in his name, Michael has not pointed to any evidence or 

testimony that the lender knew this to be the case. The record also discloses 

no evidence as to whether the listed vehicles were Michael’s separate 

property, and even if so, that the lender knew they were solely his assets and 

not assets of the community.

More importantly, the loan application listed Michael’s monthly 

employment income and identified no other income deriving from Michael’s 

separate property. “[A] basic tenant of community property law” is that 

“[i]ncome earned during the marriage belongs equally to the community 

regardless of who earned it.” (In re Marriage of Mullonkal & Kodiyamplakkil

(2020) 51 Cal.App.5th 604, 616, citing § 760 and In re Marriage of Dekker

(1993) 17 Cal.App.4th 842, 850–851.) The trial court could reasonably have 

concluded the loan proceeds were community property because Michael’s 

employment earnings during marriage were listed (and ultimately used) as 

the primary source of income for the loan. (See Bonvino, supra, 241 

Cal.App.4th at p. 1424 [upholding “finding that . . . loan proceeds were 

community property, because [the] husband’s salary [was] the primary source 

of income listed on the loan application”].)

Michael next argues that any claim Maribel had for reimbursement of 

her community share of the loan proceeds was untimely under section 920. 

This statute, which recognizes a spouse’s right to reimbursement for property 

applied to the satisfaction of a debt, specifies that the right “shall be 

exercised not later than the earlier of the following times: [¶] (1) Within 

three years after the spouse in whose favor the right arises has actual 

knowledge of the application of the property to the satisfaction of the debt. 
24

[¶] (2) In proceedings for division of community and quasi-community 

property pursuant to Division 7 (commencing with Section 2500) or in 

proceedings upon the death of a spouse.” (§ 920, subd. (c)(1)–(2).) Michael 

argues that because each mortgage payment using community funds, from 

the first payment in 1999 until the refinanced loan was paid off in June 2015, 

triggered a claim for reimbursement, Maribel’s claims are now untimely 

under the three-year statute of limitations.

We are ultimately unpersuaded, as Michael fails to cite evidence in the 

record demonstrating Maribel’s “actual knowledge” that community funds 

were applied to the satisfaction of the refinanced loan. (§ 920, subd. (c)(1).) 

Although Michael contends that Maribel “was aware that [he] used his 

community property income and savings (derived from the fire insurance 

proceeds) to make each and every monthly mortgage payment on Property 

during the marriage,” the record citations in Michael’s brief do not match 

these representations. It is Michael’s obligation to support his factual 

assertions with accurate citations to the record (Cal. Rules of Court, rule 

8.204(a)(1)(C)), “[a]nd we will not scour the record on our own in search of 

supporting evidence” (Sharabianlou v. Karp (2010) 181 Cal.App.4th 1133, 

1149).

That said, through our review of the record, we are aware of Maribel’s 

testimony that during a three-year period when Michael was unemployed, 

fire insurance proceeds that Michael had placed into an annuity account were 

used to make payments on the refinanced loan. But for purposes of 

determining the timeliness of Maribel’s claim for reimbursement of her share 

of these funds, the testimony was unclear. When asked to identify the years 

that Michael was unemployed, Maribel testified, “Maybe he can answer that. 

I’m not sure. 2000—maybe ’13.” And when Michael subsequently took the 
25

stand and had the opportunity to clarify the period of his unemployment for 

statute of limitations purposes, he simply described his unemployment as “on 

and off,” without narrowing the time span in any way. On this record, we 

imply an appropriate finding by the trial court that Michael failed to carry 

his burden as the party asserting the statute of limitations defense to 

affirmatively prove that Maribel had actual knowledge that community funds 

were applied to the satisfaction of the refinanced loan more than three years 

before she filed her petition for dissolution. (§ 920, subd. (c)(1).)

For the above reasons, we conclude the trial court did not err in 

determining that the loan proceeds were community property.

E. Watts Charges

“Watts charges are used to compensate the community when one 

spouse has the exclusive use of a community asset, most often the couple’s 

residence, between separation and trial. The spouse using the property is 

charged ‘ “for the reasonable value of that use.” ’ [Citation.] [¶] The trial 

court has discretion, based on equitable considerations, as to whether to 

impose Watts charges and in what amount.” (In re Marriage of Mohler (2020) 

47 Cal.App.5th 788, 796–797 (Mohler).) In assessing Watts charges, courts

may consider “the ‘reasonable rental value’ of the home as a guidepost in 

attempting to ensure that the ‘net fiscal impact’ of a spouse’s occupation of 

the home is reflected in the division of the couples’ property.” (Id. at p. 797.)

“Watts charges typically have been applied where the community owns 

the entire property, for example, because it was purchased with community 

funds during the marriage.” (Mohler, supra, 47 Cal.App.5th at p. 797.) In 

Mohler, the court held that the Moore-Marsden rule may also be used to 

calculate a reduced amount of Watts charges for a spouse’s postseparation 

occupation of a property that “is not entirely community property, but rather 
26

is treated as partially community property due to the Moore/Marsden rule.” 

(Mohler, at p. 791.) As Mohler explained, trial courts have discretion, based 

on equitable considerations, to apply Watts charges to compensate the 

community for its loss of rental income due to a spouse’s postseparation 

occupation of property in which the community “maintains a beneficial 

partial interest . . . due to a Moore/Marsden calculation.” (Mohler, at pp. 796, 

797.) “The concept is precisely the same as Watts charges when the 

community maintains title to the home, but with the amount charged 

discounted for the fact that the community maintains only a partial interest 

in the property for purposes of dividing the property upon a marital 

dissolution.” (Id. at p. 797.)

Here, the trial court properly applied Mohler in awarding Watts 

charges for Michael’s postseparation use of the Property. The court awarded 

the community an amount equal to the monthly fair rental value of the 

Property, discounted for the community’s partial (i.e., 70.92 percent) interest 

under the Moore-Marsden rule, for the 28 months between the parties’ 

separation and their submission of closing arguments. 

Michael insists Mohler was wrongly decided and urges us not to follow

it. He contends Mohler is “antithetical to separate property rights” under 

section 752, which provides that neither spouse has an interest in the 

separate property of the other “[e]xcept as otherwise provided by statute,”

because no statute exists for awarding Watts charges to the community based 

on its partial interest in a spouse’s separate property. But Michael cites no 

authority suggesting that section 752 bars a court’s equitable consideration of 

the community’s beneficial interest under the Moore-Marsden rule when 

exercising its discretion to award Watts charges. (Cf. Mohler, supra, 47 

Cal.App.5th at pp. 796–797 [family law courts are courts of equity and trial 
27

courts have discretion based on equitable considerations to impose Watts

charges].) To the extent Michael believes the language of section 752

embodies an implied abrogation of the Moore-Marsden rule, we reject that 

suggestion for the reasons already discussed.

Michael further argues that Mohler failed to reconcile its award of 

Watts charges based on fair rental value with section 770, subdivision (a)(3), 

which provides that the “rents” of the separate property of a married person 

are also that person’s separate property. Unlike Michael, we do not read 

Mohler as mischaracterizing “rents” in violation of section 770, subdivision 

(a)(3). Mohler simply recognized that trial courts have discretionary 

authority to consider the reasonable rental value of a home “as a guidepost in 

attempting to ensure that the ‘net fiscal impact’ of a spouse’s occupation of 

the home is reflected in the division of the couples’ property.” (Mohler, supra, 

47 Cal.App.5th at p. 797.) There is nothing to suggest that section 770, 

subdivision (a)(3), erects an impediment to that equitable determination.

Michael warns that Mohler will lead to absurd results, such as 

preventing a recently-married spouse from disposing of their separate 

property without the consent of the community after just a single mortgage 

payment is made from community earnings. For what it’s worth, Mohler 

seems to have anticipated and navigated around this issue by electing to use 

the term “ ‘beneficial interest’ ” (as distinct from a legal interest) “to describe 

the community’s Moore/Marsden interest in property that is titled in an 

individual spousal owner.” (See Mohler, supra, 47 Cal.App.5th at p. 792, 

fn. 1.) Though Michael insists that Mohler’s reasoning ineluctably leads 

“down this disturbing path of finding that Moore grants a community legal 

ownership of separate property,” we, like Mohler, express no opinion on that 

question, as it is not before us. Michael does not contend, nor does the record 
28

support, that he was prevented from disposing of the Property after 

separation by Maribel’s refusal to consent. “[O]ur role is limited to ruling on 

the factual matters before us, not hypothetical situations.” (Williams v. 

Superior Court (2007) 147 Cal.App.4th 36, 55.)

On the record before us, we reject Michael’s contentions that Mohler

was wrongly decided and conclude the trial court properly awarded 

discounted Watts charges to the community for Michael’s postseparation 

occupation of the Property.

DISPOSITION

The judgment is affirmed. Maribel is entitled to her costs on appeal.

_________________________

Fujisaki, Acting P.J.

WE CONCUR:

_________________________

Petrou, J.

_________________________

Rodríguez, J.

Herrera v. Herrera (A162657)