Fiduciary Duties Between Spouses in California

The fiduciary obligations between spouses do not end at separation. A breach may be asserted as an independent cause of action, often carrying significant financial consequences.

Under California Family Code § 721 and California Family Code § 1100, each spouse owes the other the highest duties of good faith and fair dealing. This includes full disclosure, transparency, and an obligation not to take unfair advantage in any transaction involving community property. These duties continue until assets are fully divided.

Fiduciary obligations apply to real financial decisions made during marriage and through final judgment and division of assets or debts. Each spouse is required to disclose all assets and debts, provide equal access to financial information, and avoid transferring, concealing, or risking community property without the other’s knowledge and consent. 

A breach does not require overt fraud. It often arises from conduct that, in practice, shifts control or obscures information. This can include failing to disclose accounts, moving funds without notice, or making speculative financial decisions with community assets.

In Marriage of Kamgar, one spouse transferred and traded millions of dollars in community funds without adequate disclosure or consent. The court found a breach of fiduciary duty based not only on the losses, but on the failure to act transparently and in the interest of the marital estate.

The consequences for this type of conduct are significant. Under California Family Code § 1101, a court may award one spouse fifty percent of an undisclosed or mismanaged asset, or in more serious cases, one hundred percent. Courts may also award attorney’s fees and costs, and may value assets at their highest point rather than their lowest.

The way a case is handled early matters. Decisions about disclosure, financial control, and strategy can affect the outcome. When significant or complicated assets are involved, fiduciary duty is not a side issue. It is often central to the case.

Effective legal advocacy in this context is not simply about dividing property. It is about protecting what should have been preserved, identifying what may have been lost, and positioning the case for a result that reflects the full financial reality.