What Happens to a Personal Injury Settlement in a CA Divorce?

If you have been injured by a negligent person, financial compensation from a personal injury lawsuit can help you pay for medical expenses, repair damaged property, and recover from injury. But what happens to a personal injury settlement if the injured party is going through a divorce?

According to California law, property and assets obtained during the course of a marriage are considered community property and subject to an “equal” division. When a personal injury lawsuit is filed or when an injured party obtains a settlement is obtained during the marriage, the award is also classified as community property.

However, personal injury damages are often awarded to the injured spouse. Under California Family Code § 2603 regarding “community estate personal injury damages,” all compensation obtained or to be recovered as a result of a personal injury will be assigned to the injured party unless the court determines the non-injured spouse has a right to some of those damages.

The following are common examples of when the non-injured spouse can obtain some of the injured spouse’s personal injury settlement:

• If marital funds or the non-injured spouse’s separate property were used to pay past medical expenses and property damage.

• If the award or settlement has been commingled with other assets of the community estate, unless such damages can be traced.

Under California Family Code § 781, personal injury damages are considered an injured spouse’s separate property if the injury occurred before the couple was married or after they are living separately. In addition, the non-injured spouse cannot recover damages if he/she caused the injured spouse’s losses.

If you are interested in filing for divorce in Fresno, contact Arnold Law Group, APC today at (559) 900-1263 for a confidential consultation. Our firm has more than three decades of experience helping thousands of satisfied clients.