Donald and Rochelle Sterling have been making headlines in the news for weeks now for what began as the Clippers team owner allegedly making racist remarks. More recently, the issues within their complicated divorce are arising and being questioned. Rochelle Sterling wants to take back the luxurious gifts her husband gave his mistress, V. Stiviano.
It is a common situation among couples going though divorce: one of the spouses has a side relationship and showers the girlfriend/boyfriend with gifts. Once the divorce battle is being fought, the spouse who remained single wants to reclaim the gifts from the girlfriend/boyfriend on the side. Since it is a common situation, this high-profile case should be viewed as an example for other couples in California.
For the Sterling case, Donald Sterling allegedly gave Stiviano these gifts:
- One 2012 Ferrari
- Two Bentleys
- One 2013 Range Rover
- $1.8 million for an apartment duplex
- $240,000 for living expenses and upkeep
Rochelle Sterling argues these gifts were given without her consent and were funded by community property. However, Stiviano claims they are under her name and were given to her as work compensation with Rochelle Sterling's acknowledgment. So, who's right and who has the rights to the gifts?
Under spousal fiduciary duty, technically no one is correct but both women do have rights. Regardless of whether or not Donald Sterling claimed the gifts were work expenses, they still belong to Stiviano. Even though Rochelle Sterling does not have the ability to reclaim these gifts, she does have rights to be reimbursed for them.
California is a "community property state," which essentially means both spouses have rights to everything acquired during the marriage. Since Donald Sterling bought these gifts during the marriage, the value will go back into community property and be included in the division of assets.
Burden of Proof
The gift-giver has the burden to prove that their spouse approved of the gift for it to be considered a gift from the couples combined funds. Donald Sterling breached his fiduciary duties by giving these gifts to Stiviano by himself without any written notice to his spouse.
The gifts came from community property, so under California law he should have taken further measures to notify his wife he was giving them away. It does not matter if he claims they were work compensation. Rochelle Sterling cannot take back the gifts from Stiviano, but the value of the gifts can return to the overall community property when looking at dividing assets in the divorce.
No Returns: Refunds Only
It can be a complicated matter, but the main point is the Sterlings were still married when the gifts were given and Donald Sterling did not give written notice to his wife about the gifts nor did Rochelle Sterling give concrete consent for Stiviano to receive the gifts. Therefore, Stiviano has the right to keep her gifts and Rochelle Sterling has the right to be reimbursed for the worth of the gifts. That principle applies to other married couples, one spouse may give gifts to the object of their affection, but they don't give away their spouse’s right to be compensated for the value of that gift.