SENATE BILL 206

52nd legislature - STATE OF NEW MEXICO - first session, 2015

INTRODUCED BY

John M. Sapien

AN ACT

RELATING TO COMMUNITY PROPERTY; CLARIFYING THAT SPOUSES OWE EACH OTHER A FIDUCIARY DUTY.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. Section 40-3-14 NMSA 1978 (being Laws 1973, Chapter 320, Section 10, as amended) is amended to read:

     "40-3-14. MANAGEMENT AND CONTROL OF OTHER COMMUNITY PERSONAL PROPERTY.--

          A. Except as provided in Subsections B, [and] C and D of this section, either spouse alone has full power to manage, control, dispose of and encumber the entire community personal property.

          B. Each spouse owes the other spouse a fiduciary duty when managing community personal property or incurring debt. Debts incurred in violation of the fiduciary duty may be determined to be the sole responsibility of the spouse incurring the debt. One spouse's share in community property is not subject to liability for any debt incurred by the other spouse in violation of the fiduciary duty.

          [B.] C. Where only one spouse is:

                (1) named in a document evidencing ownership of community personal property; or

                (2) named or designated in a written agreement between that spouse and a third party as having sole authority to manage, control, dispose of or encumber the community personal property [which] that is described in or [which] that is the subject of the agreement, whether the agreement was executed prior to or after July 1, 1973; only the spouse so named may manage, control, dispose of or encumber the community personal property described in such a document evidencing ownership or in such a written agreement.

          [C.] D. Where both spouses are:

                (1) named in a document evidencing ownership of community personal property; or

                (2) named or designated in a written agreement with a third party as having joint authority to dispose of or encumber the community personal property [which] that is described in or that is the subject of the agreement, whether the agreement was executed prior to or after July 1, 1973; both spouses must join to dispose of or encumber [such] community personal property where the names of the spouses are joined by the word "and". Where the names of the spouses are joined by the word "or", or by the words "and/or", either spouse alone may dispose of or encumber [such] the community personal property."

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