Marriage and divorce: property

Question 1

Community property

Answer 1

Used in nine states, community property generally requires an equal division of marital property.

Question 2

Equitable distribution

Answer 2

The majority rule, it requires equitable (i.e., fair) distribution of marital property. It need not be an equal 50–50 division.

Equitable distribution takes into consideration all of the circumstances between the parties, including:

(1) The length of the marriage;
(2) The age, health, earning potential, and needs of both spouses;
(3) The value of separate property;
(4) The spouses’ standard of living; and
(5) The economic circumstances of each spouse at the time of divorce.

Question 3

Marital property

Answer 3

Marital property, unlike separate property, is divided between spouses.

Classification of the appreciation in separate property usually depends on whether it can be attributable to spousal labor.

Marital property includes all property or assets acquired during marriage by any means other than gift, descent, or devise.

Question 4

Separate property

Answer 4

Separate property includes:

(1) anything acquired before the marriage and
(2) assets acquired during marriage by gift, descent, or devise.

Question 5

Marital property: separate property

Answer 5

Separate property can be transformed into marital property if marital funds—or efforts by the owner-spouse—enhance its value or build equity during marriage.

Question 6

Marital property: specific types

Answer 6

Marital property includes:

(1) Future retirement or pension benefits, if accrued by a spouse during the marriage;
(2) Personal injury proceeds, depending on the state’s treatment:
(a) Under one approach, all proceeds are marital property if the cause of action is accrued during the marriage;
(b) Under the other approach:
(i) compensatory damages—e.g., for pain, suffering, or disability—as well as loss of consortium damages of the non-injured spouse are separate property, whereas
(ii) lost wages, lost earning capacity, and medical expenses are marital property.

Question 7

Marital property: professional licenses or degrees

Answer 7

Most courts do not regard licenses or degrees as marital property.

Some, however, may award reimbursement for a spouse’s actual contribution to education and living expenses.

Question 8

Modification of a property division award

Answer 8

A property division is not modifiable after the fact because it is based on the parties’ assets at the time of the divorce.

Thus, changes in the parties’ circumstances after the divorce do not affect the award.

Question 9

Equitable distribution: pension of uncertain value

Answer 9

With a pension of uncertain value to be paid in the future, courts often order payment of a specified percentage of pension payments when those payments are actually made instead of requiring the title-holding spouse to compensate the other spouse at the time of divorce.

Question 10

“Hotchpot” approach

Answer 10

A minority of states subject all property owned by either spouse to equitable distribution.