Memorandum of Decision Re: Community Property

FOR THE NORTHERN DISTRICT OF CALIFORNIA In re HERBERT L. HOLM,                                                   No. 1-87-00559      Debtor. ___________________________/ ALAN WRIGHT,      Plaintiff,     v.                                                                              A.P. No. 1-89-0151 PHILOMENA HOLM,      Defendant. ______________________________/
Memorandum of Decision
     The debtor in this Chapter 11 case is Herbert Holm. His wife of 21 years is defendant Philomena Holm, who is not a debtor. During the Chapter 11 proceedings, an apartment house in which Herbert an Philomena both owned an interest was sold. The issue in this adversary proceeding is whether Philomena's share belongs to the bankruptcy estate.      The law in this area is not complicated. Section 541(a)(2) of the Bankruptcy Code provides that all community property belongs to the bankruptcy estate. Herbert and Philomena held title to the property as joint tenants; if it was a true joint tenancy, Philomena's share does not belong to the estate. However, the state of record title creates only a rebuttable presumption of joint tenancy. If there is sufficient evidence to rebut the presumption, the court may deem the property to be community property. The issues must be decided under state law. In re Jacobs (Bkrtcy.S.D.Ca.1985) 48 B.R. 570.      The court finds that in this case the presumption has been easily rebutted. Philomena's declaration makes it clear that she has no idea what the difference between community property and joint tenancy is, and that she has an interest in the proceeds of the sale because "being married to Herb, I would naturally have my share of interest in it." The evidence clearly shows that the interest of Herbert and Philomena is directly traceable solely to work Herbert alone performed while they were married. The lack of understanding of the difference between joint tenancy and community property, when coupled with a community source of acquisition, constitutes substantial evidence of community property status regardless of joint tenancy form. Lovetro v. Steers (1965) 234 Cal.App.2d 461, 471-72. See also Hansford v. Lassan (1975) 53 Cal. App.3d 364, 373; Oak Knoll Broadcasting v. Hudgings (1969) 275 Cal.App.2d 563, 568; Martinelli v. Cal. Pacific Title Ins. Co. (1961) 193 Cal.App.2d 604, 607.      For the above reasons, the court finds that all of the Holms' interest, and not just Herbert's half, is property of this bankruptcy estate notwithstanding the form in which title was held. Counsel for plaintiff shall submit an appropriate form of judgment.      This memorandum constitutes findings and conclusions pursuant to FRCP 52(a) and Bankruptcy Rule 7052.
Dated: February 10, 1990                                                                              _______________________                                                                                                                      Alan Jaroslovsky                                                                                                                      U.S. Bankruptcy