Divorce – Division of Property and Assets
Division of marital assets in a divorce is often a complicated matter. Help is available. Contact Joseph Segraves, Attorney at Law, serving North Georgia including Cobb, Cherokee and Bartow Counties, and the cities of Marietta, Acworth, Canton, Kennesaw, Cartersville and Canton, Georgia.
Two people living together as husband and wife have a natural tendency to treat and to use the family assets as if everything was commonly owned and freely available to either party. Very little attention is paid to which party holds legal ownership or title to the properties. The parties establish joint checking accounts. They jointly own their house. The title to vehicle driven by the husband is in the wife’s name. The husband has a Visa charge account but both parties use it to purchase goods. No one even thinks about who owns the T.V. or microwave oven. Over time, this can produce complicated patterns of ownership, title, use and possession of the personal and real property of the parties. When the parties separate or divorce, each party’s view of who owns or is entitled to possession of what property changes dramatically.
Division of Property – Generally: The assets of the marriage are allocated between the parties based on two general legal concepts. Property may be awarded to a spouse as a form of alimony to provide for his or her support, or the award may be based on equitable grounds. Awards of property based on alimony are not discussed here.
Marital and Separate Assets: The first step in deciding what property may be equitably divided by the parties is to determine whether or not the property is a marital asset. If the asset was acquired prior to the date of the marriage by one of the spouses, it is generally considered to be a separate asset and not subject to equitable division. If the asset was acquired during the course of the marriage, it is a marital asset unless it was acquired by one party as a gift or inheritance. Almost any type of asset acquired before the grant of a final judgement and decree of divorce or separate maintenance is considered to be a marital asset. Typical examples of marital assets are cars, homes, bank accounts, furniture, and retirement accounts. Even when acquired during the marriage, a few types of assets are not normally considered to be marital assets (example: professional license) or are treated in a special manner (example: workers’ compensation award).
Equitable Division: The basic concept of dividing the marital assets of the parties in a divorce case is to make to apportion the property based on the principle of equitable division. This is not the same thing as an equal or 50%-50% division of the assets. The court can consider a broad range of factors in deciding on the proper or fair division of the assets including the length of the marriage, each parties contribution to the acquiring the property, and/or parties’ intent regarding ownership. A party’s contribution to ownership is not limited to a monetary contribution to the purchase but can also include the value of the services provided by a party to the relationship (Example: Stay at home mom). The court can consider evidence of the conduct of the parties as a cause of the divorce in make an equitable division of the marital property.
Assets Owned Prior to Marriage: Assets owned by one of the spouses prior to the marriage are considered to be separate assets of that party. The court cannot make an equitable award to the other party of such assets. However, the ownership of and title to the asset must be maintained separate and apart from other assets, or it may become a marital assets. Additionally, the increase in the value of an asset which is due to the efforts of the other spouse or both spouses may be apportioned as part of the equitable division of the assets. As a possible example, if the residence of the parties was owned by the husband prior to the marriage but the parties used jointly earned funds to pay the mortgage, then the non-owning spouse may acquire an interest in the equity produced by a reduction in the amount of the mortgage debt.
Inherited Property: Inherited, devised or bequeathed property received by one of the parties is considered to be a separate asset of that party, and it is not subject to equitable division. If the devise or bequest is to both of the parties, then the property is a marital asset.
Gifts: Property acquired by gift may be marital property if given to both of the spouses, or it may be a separate asset if given only to one of the parties. Assets may also be given by one of the spouses to the other with the intent that the property will be the separate property of the receiving spouse. If there is a dispute over whether or not an asset is marital property or a separate asset, then judge or jury must determine the nature of the gift by the facts and circumstances showing the intent, acceptance and delivery of the gift.
Secured Assets: It is common for motor vehicles and homes to be pledged as security for the repayment of the purchase price (Example: home mortgage). The title to the property may be in name of either party or of both parties. This is sometimes further complicated by the fact that one spouse holds the title to the property and is legally responsible for the payment of the debt, but the other spouse uses or has possession of the property. This is very common with cars and car loans. This presents complicated and difficult circumstances in the division of the property of the marriage. It is often not practical or even possible to sell, refinance or pay-off a car or house loan. Frequently, one spouse is awarded title to a motor vehicle and is required to make the loan payments by the court’s order. But the court cannot cutoff the right of the lender to require payment of the debt from the original borrowing spouse. Division of these secured assets requires careful thought and planning.
Retirement Plans, Pensions and Assets: A substantial percentage of a married couples’ assets may be in the form of a retirement plan or pension plan. Typically, these are in the form of an employment related pension or a retirement plan like a 401k, or funds may be held in an individual retirement account (IRA). Ownership of the plan, pension or fund is in normally only in one of the spouse’s name, and one spouse may have a substantially larger account balance. If established during the course of the marriage, then these accounts are normally considered to be marital assets. If established prior to the marriage, then the increase in value of the account due to contributions made during the course of the marriage will normally be considered to be a marital asset. As a marital asset, these accounts and plans are subject to equitable division between the parties in a final decree of divorce. Division of these assets requires consideration of many issues and requires special procedures including the use of a qualified domestic relations order (QDRO) or other specially drafted provisions in the final divorce decree.
Furniture, Furnishings and Personal Items – The Role of Emotions, Attachments and Other Non-monetary Issues: Laws, judges and attorneys tend to focus on financial assets, real estate, and the value of assets in working with the division of the assets of a divorcing couple. When it comes to furniture and personal items, the level of the court’s interest is likely to be much lower. But in this area, many other factors enter into this process, and it is impossible to ignore the feelings, emotions and needs of the parties in determining what assets will be owned by which party after the divorce is over. Parties frequently say “I bought that!”; “My sister gave us that!”; “He does not want it. He just does not want me to have it!”; “She doesn’t even like the dog!”; etc. These are all valid but difficult concerns. Common sense and a realistic approach to the division of assets will help you make these tough choices. If the court makes the choices, neither party may be happy with the results.
The division of the assets of a couple in a divorce can be a difficult matter. An experienced attorney familiar with divorce law and proceedings can help you protect your property and financial well-being. We have the knowledge, experience and skill to assist you. We represent individuals throughout North Georgia including Woodstock, Canton, Acworth, Kennesaw, Marietta, Cartersville, Dallas, and Johns Creek us today to discuss your situation today.