Pereira vs. Van Camp:

Understanding Property Division in Divorce

Expert Guidance for Fair Asset Division

Dividing assets during a divorce can be complex, especially when a business or investment grows over time. Courts often use two key legal methods—Pereira and Van Camp—to determine how much of that growth should be classified as separate or community property.

At White Oak Legacy Partners, we specialize in applying these methods to ensure accurate and equitable property division. Our in-depth analysis helps clients navigate financial disputes with clarity and confidence.

Work with Us

The Two Methods: When Effort vs. Market Forces Matter

Both approaches stem from landmark California cases and provide different ways to divide business profits fairly.

Pereira Method: Applied when a spouse’s active efforts—such as management, skills, or labor—are the primary drivers of business growth.
Van Camp Method: Used when a business's success is largely due to market conditions or passive appreciation rather than direct involvement.

Choosing the right approach ensures a fair distribution of assets based on each spouse’s contributions.

The Pereira Method: When a Spouse’s Effort Drives Business Growth

The Pereira method is used when a spouse’s hands-on management directly increases a business's value.

How It Works:

Separate Property Allocation: The initial business value before marriage is given a fair return.
Community Property Share: Any excess growth beyond this return is considered community property.

Example of Pereira in Action:

Starting Business Value: $200,000
Annual Growth Rate: 5%
Years of Marriage: 10
Current Business Value: $500,000

Separate Property: $300,000 (original investment + reasonable return)
Community Property: $200,000 (growth attributed to the spouse’s active efforts)

The Van Camp Method: When Market Conditions Drive Success

The Van Camp method applies when a business grows primarily due to external factors, like market trends or passive investments, rather than a spouse’s direct involvement.

How It Works:

Community Property Allocation: The managing spouse is assigned a reasonable salary for their contributions.
Separate Property Share: The remaining business value is considered separate property.

Example of Van Camp in Action:

Fair Salary for Managing Spouse: $50,000/year
Years of Marriage: 10
Actual Salary Paid to Spouse: $20,000/year
Current Business Value: $500,000

Community Property: $300,000 (unpaid portion of reasonable salary)
Separate Property: $200,000 (business value due to external factors)

Choosing the Right Approach: Pereira or Van Camp?

Determining which method applies depends on several factors:

Use Pereira if the business grew mainly due to a spouse’s active involvement and expertise.
Use Van Camp if business success was driven by market conditions or pre-existing value.

At White Oak Legacy Partners, we analyze the details of each case to ensure the correct method is applied. By balancing legal principles with financial analysis, we help clients achieve fair and just property division.

Why Choose White Oak Legacy Partners?

Navigating property division in divorce requires a clear understanding of business valuation, financial contributions, and legal precedents. Our expertise in Pereira and Van Camp analysis helps clients protect their financial interests while reaching equitable settlements.

Clear, Data-Driven Analysis

Fair Application of Legal Framework

Guidance Through Complex Financial Matters

If you're facing business-related property division, contact White Oak Legacy Partners for trusted expertise and strategic insights.

Work with White oak legacy partners