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Equitable Distribution and Divorce, a Love Story

"Money spent on getting mad or getting even is money wasted." - Richard Wagner

One of the most common notions about divorce is that the spouses involved will inevitably lose half of their "stuff" upon the Judge's final order. While this can, and does happen, it is not the hard and fast rule and is not the only way that marital assets are divided. Dividing marital assets is not as simple as splitting your "stuff" right down the middle, or even splitting it at all. This process by which marital assets, debts, and liabilities are divided is known as equitable distribution.


Through the process of equitable distribution, married parties either agree or are ordered by the Court to distribute marital assets, debts, and liabilities between themselves. This equitable distribution process typically includes the division of marital properties, vehicles, material items, retirement plans, and bank accounts among other assets. Debts and liabilities incurred and held by the parties during the marriage such as student loans, car loans, mortgages, tax penalties, etc., are also divided using a balancing test among other factors.


You may notice the term "marital assets" and "marital debts" being thrown around in this article. Much to the enlightenment of the average person, getting a divorce does not invoke the division of assets, debts, and liabilities from the parties prior to the marriage, that is, as long as those assets, debts, and liabilities have not been commingled with marital property, or have been utilized in the marriage in such a way that they could be considered marital.


The distinction between a marital asset and a non-marital asset is as simple as asking, "was this asset acquired prior to the marriage, and has it been held separately by one spouse without involvement from the other?" If the answer to both of those questions is yes, then there is a strong chance that the asset in question is non-marital and will not be subject to equitable distribution. This goes for debts as well. If your spouse had student loans prior to your marriage, and during the marriage, your spouse remained solely named to those loans then a presumption will apply that they are non-marital and should not be divided among the parties during the divorce.


Like anything in law, there is a gray area for all of this, and to truly know whether or not your assets, debts, and liabilities are marital, you should consult an attorney who handles these matters. Equitable distribution creates tenses situations and can complicate an already complex divorce, however, the best remedy to streamline the process is to have documentation in the form of writing, records, and ledgers. Through the discovery phase of a divorce, a skilled attorney should be able to make determinations and form an educated opinion on which way the scale will tip when the equitable distribution schedule is ordered or proposed.




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