Preliminary Declaration of Disclosure in California Divorce

The preliminary declaration of disclosure is a sworn statement that each spouse in a California divorce gives the other early in the case. It is signed under penalty of perjury. It lists every asset and debt either spouse has or may have an interest in, whether community or separate. It includes the last two years of tax returns, and a completed income and expense declaration is provided along with it.

This article walks through what the preliminary declaration is, what goes into it, when it is due, and what California law does when a spouse does not provide it.

What the Preliminary Declaration of Disclosure Is

California treats financial disclosure in a divorce as a matter of public policy. Under Family Code section 2100, the Legislature declared that "a full and accurate disclosure of all assets and liabilities in which one or both parties have or may have an interest must be made in the early stages of a proceeding for dissolution of marriage or legal separation of the parties, regardless of the characterization as community or separate, together with a disclosure of all income and expenses of the parties."

The preliminary declaration of disclosure is how each spouse meets that duty at the start of the case. "Disclosure" here means showing the other spouse the full picture of what exists. That includes property one spouse firmly believes is theirs alone, not just what both agree is shared.

The requirement generally applies in a proceeding for dissolution of marriage or legal separation. The statute allows narrow exceptions: a court order for good cause, or situations where the law says service is not required. Section 2107(d) also refers to a court-granted voluntary waiver of receipt of the other party's preliminary declaration, so the exceptions are not limited to those two.

The final declaration of disclosure is a second, later disclosure served closer to settlement or trial. It is covered in its own section below. The rest of this article focuses on the preliminary.

What the Preliminary Declaration of Disclosure Must Include

Family Code section 2104(a) requires the preliminary declaration to be signed under penalty of perjury on a form the Judicial Council prescribes. It must include all tax returns the declarant filed in the two years before serving it.

Section 2104(c) sets the standard for detail. The declaration must describe its contents with enough particularity "that a person of reasonable and ordinary intelligence can ascertain" each of these:

• Every asset and every debt. This covers all assets the declarant has or may have an interest in, and all liabilities the declarant is or may be liable for. It applies "regardless of the characterization of the asset or liability as community, quasi-community, or separate."
• Partial ownership. When property is not solely owned by one or both of the parties, the declarant states their percentage of ownership in each asset and percentage of obligation for each debt.

The declaration may also state the declarant's view of whether each item is community or separate. Those terms have statutory meanings. Under Family Code section 760, property acquired by a married person during the marriage while domiciled in California is community property, except as otherwise provided by statute. Separate property under section 770 includes property owned before marriage and property acquired after marriage by gift, bequest, devise, or descent. Section 125 defines quasi-community property as real or personal property, wherever situated, acquired by either spouse while domiciled elsewhere that would have been community property had that spouse been domiciled in California at the time, or acquired in exchange for such property. The core duty, though, is to disclose the assets and liabilities, regardless of how they are characterized. California's disclosure policy also reaches income and expenses (section 2100(c)).

The financial documents checklist covers gathering documents.

When the Preliminary Declaration of Disclosure Must Be Served

Section 2104(f) sets a fixed timeline. The petitioner, meaning the spouse who filed, serves the preliminary declaration either together with the petition or within 60 days of filing it. The respondent, meaning the spouse who was served, does the same with the response or within 60 days of filing the response.

One special case exists. When the summons and petition were served by publication or posting under a court order, and the respondent files a response before a default judgment is entered, the petitioner has 30 days from that response to serve the preliminary declaration.

The duty runs to the other party. The statute requires each spouse to "serve on the other party" the preliminary declaration. Under section 2104(b), the preliminary declaration is not filed with the court except on court order, but the parties file proof of service of it with the court.

Section 2104(f) also provides that the time periods may be extended by written agreement of the parties or by court order, and section 2104(a) excepts a court order for good cause and situations where the law excuses service. Family law cases from Carlsbad are generally heard at the Superior Court of California, County of San Diego, North County Regional Center, 325 South Melrose Drive, Vista, CA 92081. The San Diego Superior Court and the statewide California Courts self-help divorce pages both describe the general process. A California divorce process timeline shows where this step falls among the others.

How the Preliminary and Final Declarations of Disclosure Differ

Section 2104 governs the preliminary declaration. Family Code section 2105 governs the final one. Both rest on the same policy of full disclosure, but they come at different points in the case.

The preliminary declaration arrives at or near the start. It gives each spouse an early, sworn inventory to work from.

The final declaration of disclosure comes later. Under section 2105(a), each party serves it before or at the time the parties reach an agreement on property or support. The agreement referred to does not include one on pendente lite (temporary) support, and a court order for good cause can change the timing. If the case goes to trial, it is due no later than 45 days before the first assigned trial date. A current income and expense declaration goes with it. The income and expense declaration is a statement of earnings and costs, and it is distinct from the inventory of assets and debts.

Another difference is waiver. Under section 2105(d), the spouses may mutually waive the final declaration. The waiver must be signed under penalty of perjury, either in open court or by separate stipulation. Each spouse must confirm that the preliminary declarations were completed and exchanged, that current income and expense declarations were exchanged, and that all disclosures were fully updated. They must also confirm that the waiver is knowing and voluntary. Each party must also state an understanding that noncompliance with those obligations will result in the court setting aside the judgment.

Between the two declarations, the duty does not pause. Under Family Code section 2102, each spouse must give an "immediate, full, and accurate update" when there are material changes. Each must also disclose in writing certain income-producing opportunities that arise after separation but grow out of activity during the marriage.

What Happens If the Preliminary Declaration of Disclosure Is Not Served

Family Code section 2107 supplies the remedies. Under section 2107(a), when one spouse has served their declaration and the other has not, or has served one lacking enough detail, the complying spouse may, within a reasonable time, request that the declaration be prepared or made more specific.

Section 2107(c) makes sanctions the general rule. If a party fails to comply with the disclosure chapter, the court "shall" impose money sanctions in addition to other remedies. The sanctions are set at a level meant to deter repeat conduct and include reasonable attorney's fees, costs, or both. The exception is when the court finds the noncomplying party acted with substantial justification or that sanctions would be unjust.

Section 2107(d) addresses finality. If a court enters a judgment when the parties have not complied with all disclosure requirements, the court generally "shall set aside the judgment." The statute adds that the failure "does not constitute harmless error." A narrower rule applies when the court granted one spouse's voluntary waiver of receiving the other's preliminary declaration. In that situation, the set-aside generally happens only at the complying spouse's request, unless the motion rests on grounds such as actual fraud or perjury in the disclosures. Section 2104(a) separately notes that perjury on the preliminary declaration may be grounds for setting aside the judgment. Section 2122(f) also lists failure to comply with the disclosure requirements as a ground for a motion to set aside a judgment, to be brought within one year after the date on which the complaining party discovered, or should have discovered, the failure to comply.

A breach of the spousal fiduciary duty can also give rise to a separate claim, described next.

The Fiduciary Duty Behind the Disclosure Requirement

Family Code section 721(b) states that spouses are subject to the rules governing fiduciary relationships. This one "imposes a duty of the highest good faith and fair dealing on each spouse, and neither shall take any unfair advantage of the other."

Section 721 spells out parts of that duty. They include giving the other spouse access to books kept about a transaction, giving true and full information on request about anything affecting community property, and accounting for any profit made from community property without the other spouse's consent.

Family Code section 1100 generally gives either spouse management and control of community personal property. Family Code section 1101 gives a spouse a claim against the other for a breach of fiduciary duty that impairs the claimant's one-half interest in the community estate. A court may order an accounting and decide who owns what. Section 2102 carries these section 721 standards forward from separation until each asset or debt is actually distributed.

Section 2100(b) explains the purpose. The Legislature favors "reduction of the adversarial nature of marital dissolution and the attendant costs by fostering full disclosure and cooperative discovery." Section 2100(c) adds the goal that, at settlement or trial, each spouse will have "a full and complete knowledge of the relevant underlying facts." That is why separate property is disclosed too. For businesses or layered holdings, see the page on complex financial divorce.

Talking With the Firm About Financial Disclosure

The firm practices California family law only and serves Carlsbad and North County, including Oceanside, Vista, San Marcos, Solana Beach, Del Mar and Rancho Santa Fe.

To talk with the firm about financial disclosure in a divorce, call Carlsbad Family Law Advocates at (760) 840-5102 for a confidential consultation.