Automatic Temporary Restraining Orders and the Fiduciary Duties of Spouses

The details surrounding the divorce of Jon and Kate Gosselin of the reality show, Jon and Kate Plus 8, are being reported on daily. Most recently, at the request of Kate Gosselin, a Pennsylvania judge has ordered Jon Gosselin to return $180,000 he withdrew from the parties’ joint bank account. The judge’s order was based on Kate’s claim that Jon violated an arbitration order preventing either party from withdrawing funds or writing checks from their joint account without permission from the other.

In California, if either party to a dissolution, legal separation, or nullity proceeding withdraws a large sum from a bank account without the consent of the other party, as Jon Gosselin allegedly did, he or she is automatically in violation of court orders. The Automatic Temporary Restraining Orders (ATROs) contained in the Summons are effective immediately upon the filing and service of the Summons and Petition for dissolution, legal separation, or nullity of marriage. The orders are intended to protect the parties’ interests and rights with regard to their children and property. Specifically, the Summons states that both parties are restrained from:

  1. Removing their minor child from the state without the prior written consent of the other party or an order of the court;
  2. From transferring, encumbering, hypothecating, concealing, or in any way disposing of any real or personal property, whether community, quasi-community, or separate, without the written consent of the other party or an order of the court except in the usual course of business or for the necessities of life. Further, each party is required to notify the other party of any proposed extraordinary expenditures;
  3. From cashing, borrowing against, canceling, transferring, disposing of, or changing the beneficiaries of any insurance or other coverage, including life, health, automobile, and disability, held for the benefit of the parties or their child or children for whom support may be ordered; and
  4. From creating a non-probate transfer or modifying a non-probate transfer in a manner that affects the disposition of property subject to the transfer, without the written consent of the other party or an order of the court.

The above orders are in effect until a final judgment is entered, the petition is dismissed, or until further order of the court.

In addition to the ATROs, spouses have a “fiduciary duty” to each other. This means that both spouses have a duty of the highest good faith and fair dealing and neither shall take unfair advantage of the other. For example, withdrawing funds from a joint account without giving the other spouse notice or obtaining his or her permission may be a violation of the fiduciary duty.

So what does this mean for you? While the fiduciary duty imposed on spouses is relatively self explanatory, the application of the ATROs can be confusing. For example, with regard to property, if you are a party to a dissolution, legal separation, or nullity of marriage, you may not withdraw, spend, or otherwise use community, quasi-community, or separate property without the consent of your spouse except in the “usual course of business” or “for the necessities of life.” However, what constitutes the “usual course of business” or the “necessities” of life? Further, what counts as an “extraordinary expenditure?” In addition, are you permitted to use any property to pay your attorney’s fees and costs? The answers to these questions will vary on a case by case basis.

At Mello & Pickering, LLP, we can help you with any questions you may have regarding the fiduciary duty owed to your spouse and the above ATROs. We can also advise you on what you may and may not do once you become a party to a dissolution, legal separation, or nullity proceeding. We can also assist you with a variety of other issues that often come up in dissolution, legal separation, and nullity proceedings, such as spousal support, child support, child custody and visitation, and property division. Call Mello & Pickering, LLP today for an initial consultation or an hour appointment with one of our attorneys at (408) 288-7800.

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