Pereira v. Pereira
Supreme Court of California
156 Cal. 1 (1909)
Mr. Pereira (defendant) had already invested about $15,500 of his own money into his business before marrying Mrs. Pereira (plaintiff), and continued running the business with that same investment in place throughout the marriage. After Mrs. Pereira won a divorce on grounds of extreme cruelty and was awarded three-fifths of the business's earnings and acquisitions, the trial court treated all of the business's profits as community property without crediting Mr. Pereira for his original separate-property investment. On appeal, the appellate court reversed and remanded for recalculation, and on Mrs. Pereira's petition for rehearing, the appellate court instead simply amended the judgment to credit Mr. Pereira with his $15,500 investment plus 7% interest; Mr. Pereira appealed further.
Whether a spouse's separate-property investment into a personal business, and the interest or profit earned on that investment, are considered separate property upon dissolution of the marriage.