Equitable Distribution

The process of dividing your marital property through the court system is known as "equitable distribution". Under this system, property is classified as either "separate", "marital", or "divisible". Separate property is property either spouse had prior to the marriage or after the date of separation, and that they did not convey to the other spouse in whole or in part. Separate property cannot be divided, because only one party owns the property. Marital property is property acquired by either spouse during marriage and prior to separation. All property acquired during the marriage is presumed to be marital property, but this presumption can be overcome with evidence. It does not matter if the property is listed only in one party's name, it is still presumed marital if it was acquired during the marriage. The same is true for debts. All debts acquired during the marriage are presumed to be marital, and thus can be divided between the parties. Divisible property is property that is derived from marital property that changes in value after the date of separation. This usually involves property such as stocks that increase or decrease in value after the date of separation. This change in value can be divided by the court even though it occurred after the separation.

The equitable distribution laws only applied to married persons. If you own property with a person that you are not married to, or have a joint debt, you cannot use the equitable distribution laws to divide your property. The process of equitable distribution can be a costly and lengthy process. This is because it often takes a long time to gather all of the information regarding the parties assets and liabilities, the law has built in statutory time frames that must be followed, a lot of negotiation is frequently involved, the parties often cannot agree on fundamental issues, the trial on the issues can take several days, and the court is not equipped to efficiently handle multiple equitable distribution trials at the same time. Still, despite the various issues involved, many cases are often settled prior to a trial. Like the other issues related to the dissolution of a marriage, property division can also be accomplished through a separation agreement without the need of court intervention or a lawsuit if the parties can cooperate. In most cases, an equitable distribution case will cost between five and ten thousand dollars. However, it is not unusual for a case to cost even more, sometimes much more, because of the issues presented and the time involved. Therefore, if the parties can agree to divide their property in a separation agreement prior to filing any lawsuit, both parties can save a very significant amount of money.

What is the process for property division? - The process is rather lengthy, but in short, the court will look at all the marital assets and marital debts, and attempt to allocate them evenly between the parties so that they both share an equal amount of assets and debts. In some cases, a party may end up responsible for more debt in exchange for a greater portion of the assets, or a lesser portion of debts in exchange for fewer assets. The parties do frequently have some control over the process by agreeing to certain distributions in a pre-trial order. This occurs where the parties have divided some items to their mutual satisfaction and are asking the court to divide only those items they cannot agree on. It is also important to remember that while there is a presumption that property will be divided equally, the court must consider all other statutory factors in dividing property. In some cases, the court may determine that a 50/50 split between the parties is not a fair and equitable distribution, and may allocate the property in a different percentage.