Economic Issues Flashcards

1
Q

What are the 2 steps toequitable distribution?

A

STEP 1

Divide assets into 3 categories (on exam make 3 columns): (1) Spouse 1’s; (2)Spouse 2’sseparate property; AND (3) Marital property subject to distribution

STEP 2

(i) Give S-1 and S-2 their separate property
(ii) Exercise equitable discretion to divide up the marital property subject to distribution

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2
Q

How is the separate property of each spouse determined?

A

Separate property =

1) Anything owned PRIOR to marriage
2) Bequests/gifts received by either spouse in their sole name 3) Inheritance
4) Property they agree will be treated as separate property (in written agmt)
5) Personal injury compensation (designed to comensate for pain/suffering)
6) Passive appreciation on the above property (change in value due to time or market place fluctuation) BUT appreciation due to active participation or mgmt by spouse in adding value is a MARITAL asset (Ex – increase in value of a separate property during the marriage due to the contribution of the other spouse as homemaker & parent)

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3
Q

How ismarital property determined?

A

Marital property subject to distribution =

1) All property acquired during marriage REGARDLESSof how asset titled & who works 2) Includes professional licenses/degrees earned during marriage (but advanced earnings cannot be double counted for alimony purposes) 3) All businesses, salaries, stock options, lottery winnings, pension rights, gifts from spouse

RULE: when in doubt, it’s marital

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4
Q

How does a ct determine how to distributemarital assets?

A

Court may consider any relevant factor, EXCEPT marital fault, UNLESS such fault is egregious (“shocks the conscience”)

Courts divide marital property equitably & are guided by statutory factors (age, health insurance coverage, job skills, custodian of children, etc.) but there is no exact percentage & the court has discretion

Can order in-kind transfer (item by item) ORlump sum (cash award payment) to effectuate distribution

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5
Q

What are 2 types of maintenance?

A

Aka “alimony”

1) Temporary maintenance- ordered while case is pending to meet temporary needs of parties (designed to preserve the status quo)
* *On essay, say this if the party is worried abt supporting themselves during a claim**

2) Final maintenance – post-divorce, continuous pmt No automatic entitlement—based on reasonable needs of recipient

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6
Q

In assessing maintenance amt, what factors does a ct look to?

A

Court may consider ANY factor it deems relevant, including…

1) Nature & degree of fault; 2) Age and health of parties; 3) Skills, earning capacity, time needed to gain job skills; 4) Whether spouse cares for the children or another family member;
5) Standard of living while married;
6) Duration of the marriage; 7) The division of property already

NOTE:the economically stronger party generally pays the weaker party’s counsel fees in an action for maintenance

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7
Q

How are maintenance orders enforced, modified OR terminated?

A

Enforcement: if spouse violates the order for maintenance, the ct can…

1) Seize & sell property 2) Attach spouse’s wages 3) Seize drivers & professional licenses
4) Hold spouse in contempt of ct (jail time)

Modification: any party can move for a modification (up or down) Modification permissible upon showing of substantially different circumstances
If p/t separation agmt, extreme hardship must be shown Prospective modification only – past due pmts are STILL owed Encourages people to get to ct. early upon a change in circumstances

Termination: Normally terminates AUTOMATICALLY on death of either party Remarriage (or cohabitation as if marriage) of recipient spouse is grounds for termination AUTOMATICALLY NOTE: cohabitation w/o marriage not enough to terminate unless cohabatitor represents to the world that he’s married. NOTE: YOU CAN K around these automatic terminations in a sep agmt

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8
Q

Statute of limitations for maintenance arrears?

A

20 years

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