Division of Marital Property @ Divorce

Question 1

Communal Property

• def
• Jx divide
• policy

Answer 1

def: each spouse has a present (during M., prior to divorce) vested 1/2 interest in all property acquired DURING Marriage.

Minority Jx: only 3 States assess Marital Property in this way, and require a 50/50 split at Divorce.

Majority Communal Prop Jx: Using Equitable Distribution of the property at divorce.

Policy: regards Marriage as a “partnership” or “community” & treats divorce as an implicit consent to dispose of the community’s property by dividing it amongst its “members” (the spouses).

Question 2

Title Theory of Property

• def
• Kinds of titles (list)
• policy

Answer 2

def: strict title theory dictates that the person holding the title to an interest in property keeps that interest (or asset).

3 kinds of titles:

1) JT (Joint Tenant): all tenants own the whole/undivided interest w/survivorship where the interest is “absorbed” by the surviving party upon death of the other.
2) TE (Tenancy in the Entirety): JT + a unity of person-hood; only applies to married couples.Partitioning is permitted upon Mutual Consent.
3) TC (Tenancy in Common): equal rights in ownership/interest; however, no survivorship (or “absorption”). Not recommended for married couples.

These titles only apply where the spouses share ownership of property/assets/interests.

*Policy premised on ‘Coverture’ … where the man owns everything and overlooks the Household contributions. Tends to lead to unjust distributions. If the man has his name on the titles, then he keeps everything at the divorce with marginal allocations for the wife.

Question 3

Equitable Distribution

• Majority Jx regime
• Underlying principle

Answer 3

Majority Jx: 42 States + D.C.
(includes Ohio)
1) allocation according to Spouse’s contributions to acquisitions
2) allocation according to each Spouse’s relative “need”

Principle:
Labor + Contributions creates a “BODY OF MUTUAL ASSETS”

Jx ddx on ‘what constitutes labor?’ & ‘what constitutes a contribution’ & ‘to what extent, if any, are the assets divisible?’

Question 4

3 Steps in property division

Answer 4

1) Identify & characterize each asset as Marital or Separate
2) Valuate each asset that is Marital for purposes of distribution (in in equitable distribution Jx s (all but 3) valuate Separate assets for equity considerations).
3) Distribute the divisible assets
a) equally if 50/50 state (only 3)
b) equitably for all others
or, in the alternative, determine what to liquidate and assign monetary award(s) to balance the distribution out according to equity or equality.

Question 5

The different Jx approaches

*based on community prop, title theory, equitable distribution, and 50/50 equality

Answer 5

1) All property during marriage is community property, but use equitable distribution @ divorce (5 Jx)
2) All property during marriage is community property, but use 50/50 at divorce (3 Jx)
3) All property during marriage goes by Title Theory (and varies depending on which kind of title regime is used), and equitable distribution of the marital property ONLY at divorce.
4) KITCHENSINK/HODGEPODGE: Title theory of property during the marriage, then divide everything at divorce, including separate property. Minority Jx, if any at this point.

Question 6

DOMA’s property division scheme

Answer 6

DOMA recommends a division of all property regardless of the title holder or when/how acquired.

pro: makes the definition of marital equity easy.
con: makes for infinite negotiation when EVERYTHING is on the table.

Question 7

Transmutation of Property

• def
• traceability
• appreciation of separate asset

Answer 7

Although property acquired
*prior to marriage
*by gift solely vested (explicitly)
…once “comingled” with the marital estate/property/assets, that otherwise “separate” property transmutes into marital property.

However, some Jx will keep the property/value separate if “traceable”

An asset is traceable if its value can be traced back to its original state. Such as taking the original value of a comingled bank account as = original spouse’s $ + other spouse’s original $ + the marital contributions and/or interest.

The interest or appreciation of a separate asset (comingled or not, depends on Jx), is presumptively classified as a marital asset.