Can you Sell Community Property During a Divorce in Arizona?
Selling Community Property During a Divorce in Arizona
Some people ask can you sell community property during a divorce in Arizona. People may be unaware that, as a general rule, you may not sell community property while the divorce is pending. A Preliminary Injunction is issued when the initial divorce papers are filed with the clerk of the court. That Preliminary Injunction is immediately enforceable against the person filing the divorce papers but only becomes enforceable on the other party when he or she is served with those divorce papers. That Preliminary Injunction precludes either party from selling community assets. There are many exceptions to this rule including, but limited to, the sale of community property for the sole purpose of paying attorney fees.
The Arizona Court of Appeals in the Saxon v. Riddel case held the Preliminary Injunction precludes either party from selling the marital residence before the final Decree of Dissolution of Marriage is filed with the Court. That case, however, contained an exception allowing the home to be sold during the divorce if the home is in danger of foreclosure.
Exceptions to the Rule Prohibiting Sale of Community Property During a Divorce
So, the general rule is that you may not sell community property during a divorce in Arizona. However, there are some important exceptions to that rule. You may sell community property if you do so in the normal course of business. So, what does the ordinary course of business mean? An example may be if you own a business that regularly sells things to consumers. You may continue to sell items in your business because that is the normal course of business to do so. In contract, you could not hold a yard sale to sell the community property located in your home.
You may also need to sell community property because you are not receiving sufficient financial support from your spouse and, therefore, need to sell community property to provide for your basic needs. You may need to sell property to ensure the house payment is made, the utilities stay on in your home, and you money for food and other necessities of life. You should also be aware the Preliminary Injunction specifically authorizes the sale of community property during an Arizona divorce if necessary to allow you to pay your attorneys fees. This, of course, is not permitted if you have sufficient resources from income or other available funds to pay for your attorney.
Contact Our Scottsdale Arizona Community Property Attorneys
Call us at (480)305-8300 to schedule a consultation with one of our Scottsdale and Phoenix Arizona Community Property Attorneys regarding Arizona community property laws or any other Arizona family law matter.