Watts Charges: What Constitutes Exclusive Use and Possession?

Posted on March 25th, 2012

Husband’s presence in wife’s residence a couple of days per week simply to wash his clothes did not legally or factually diminish the wife’s exclusive possession and control of the residence.

In Irmo Carlos, an unpublished opinion of District 2, Division 6 (Filed January 4, 2012), Wife filed a petition for dissolution in 2006 after 42 years of marriage.  In 2007, the court entered a judgment of dissolution distributing Husband’s pension and IRA account equally.  Since Husband began receiving pension benefits in 1998 and had not paid Wife her one-half share, the court ordered Husband to pay Wife $66,924.  The court reserved jurisdiction over the issues of spousal support, community real property, and Wife’s request for attorney fees. Since reimbursements and credits relating to the family real property residence were not adjudicated, the court had jurisdiction over those issues as well.

In 2009, following a trial of the reserved issues, the trial court awarded a residence in Ventura to Wife and a property in Kern County property to Husband.  Husband was entitled to an equalizing payment of $82,000 based on the stipulated values of the two properties that was offset by the $81,680 he owed Wife in unpaid pension benefits through the date of trial.

The trial court also charged Wife with the reasonable rental value of the Ventura residence between 1996 and the date of trial.  (The trial court made this award based on the well-known case of Watts (1985) 171 Cal.App.3d 366.)  The court rejected Wife’s argument that she should not be charged because she did not have sole use and possession since Husband came to the house about 2 days a week to take a shower, wash his clothes, and other minimal uses.  After charges to Husband for his use of the Kern County property were set off, Wife was assessed $96,000 for the period from 1996 to 2009.  The wife appealed this ruling and lost on appeal.

Family Code § 2550 requires the trial court, upon dissolution of marriage at the divorce trial, to divide the community estate of the parties equally.  (Irmo Fonstein (1976) 17 Cal.3d 738, 748.)  In equalizing the division of community property, the trial court may order a spouse to reimburse the community for the value of the exclusive use of a community asset between the date of separation and the date of trial. (Citing Watts, supra, 171 Cal.App.3d at p. 374; Irmo Duncan (2001) 90 Cal.App.4th 617, 631-632.)

There are no specific guidelines for determining when Watts charges should or should not be awarded.  Rather, the trial court judge or commissioner has wide discretion and must consider all the circumstances when determining whether it is equitable, fair, and reasonable to order reimbursement in a particular case.  (Watts at p. 374; Irmo Braud (1996) 45 Cal.App.4th 797, 818-819.)

The Court of Appeal noted the trial court’s finding that Wife removed Husband’s possessions from the Ventura residence and that he used only one room in the family residence twice a week.  “Husband’s presence in the residence a couple of days a week to wash his clothes did not legally or factually diminish Wife’s exclusive possession and control of the Ventura residence.”  Assessment of Watts charges was not error.

Our attorneys are experienced in litigating issues of reimbursements and credits in a divorce case.  Please call us today or contact us by email.