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Freezing assets

Thousand Oaks, CA |

My husband and I are discussing divorce and are trying to work out our financial agreement. At what point would assets be frozen? At the time of filing or once we've filed? Can any assets be sold prior to filing without having to share? We are in a community property state.

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Attorney answers 1


The assets (marital ["community"] and separate) aren't exactly "frozen." What does happen, however, is that upon filing of a Petition for Dissolution (as well as Legal Separation), what are known as "Automatic Temporary Restraining Orders ("ATROS") go into effect. They are binding as against the Petitioner upon filing of the Petition, and against the Respondent (the other spouse) when they are served. These orders provide as follows:
Starting immediately, you and your spouse or domestic partner are restrained from
1. Removing the minor child or children of the parties, if any, from the state without the prior written consent of the other party or an order of the court;
2. Cashing, borrowing against, canceling, transferring, disposing of, or changing the beneficiaries of any insurance or other coverage, including life, health, automobile, and disability, held for the benefit of the parties and their minor child or children;
3. Transferring, encumbering, hypothecating, concealing, or in any way disposing of any property, real or personal, whether community, quasi-community, or separate, without the written consent of the other party or an order of the court, except in the usual course of business or for the necessities of life;
4. Creating a non-probate transfer or modifying a non-probate transfer in a manner that affects the disposition of property subject to the transfer, without the written consent of the other party or an order of the court. Before revocation of a non-probate transfer can take effect or a right of survivorship to property can be eliminated, notice of the change must be filed and served on the other party.
You must notify each other of any proposed extraordinary expenditures at least five business days prior to incurring these extraordinary expenditures and account to the court for all extraordinary expenditures made after these restraining orders are effective. However, you may use community property, quasi-community property, or your own separate property to pay an attorney to help you or to pay court costs.
As you can see, there are a variety of things neither you nor your spouse can do once the papers have been filed. Either of you can, however, ask the court for permission to do one of these things, or you can both always agree to do one of these acts (make sure it is in writing). So, to answer your question you and your spouse can likely agree to list and sell your home without court permission, and, even if one of you disagrees to the sale, the other one can go into court and ask for permission, provided there is a good reason for the sale. Good luck with this.

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