Recently, I have been giving thought to how increases in separate property values through the active work of a spouse is considered during equitable distribution. As a refresh, the goal of a trial court in divorce is to classify all property owned on the date of separation, value it, and then distribute it between the parties; only marital property is distributed. Generally, increases in value to separate property during the course of a marriage are still separate property. However, the analysis does not end there. Continue reading →
Dechkovskaia v. Dechkovskaia, 232 N.C. App. 350 (2014)
Equitable Distribution is a mechanism by which former spouses separate their personal and real property. Sometimes the spouses may have some marital (or divisible) interest in a third party’s property. One example is when a couple resides at one spouse’s parent’s residence, and the spouses make some improvement on the land that increases property value. That likely creates an interest in the improvement on the home, which can be attributed to one or both spouses in some manner. Continue reading →
Brackney v. Brackney, 682 S.E.2d 401 (N.C. App. 2009).
- Facts: Plaintiff and Defendant had a child with severe neurological needs. To accommodate the child’s needs, they chose to build a single-level home that was accessible. The child unfortunately passed. The parties then separated a year later. The home’s construction was not yet finished and the parties had not yet closed on the home. Per the contract with the home builder, if the home did not close on a specific date, the down payment for the home would be forfeit. The Plaintiff was allocated the home in an interim distribution, and thereafter closed on the home. In the preceeding years, the property value on the home skyrocketed by $181,000. At trial, Plaintiff made an argument that this increase was his own separate property. The trial court did not agree, classified it as divisible property, and Plaintiff appealed.
In Equitable Distribution, we often ask clients about the debts that they accrued during the marriage and the value on the date of separation. This is because the judge is required to classify, value, and distribute marital property. But it may not always include debts incurred during marriage. The debts acquired by a spouse can be classified as marital, separate, or divisible, but only by showing that the debt has certain elements, required by law, can a debt be classified as marital. Continue reading →
Vonhall v. Vonhall, (No. COA20-466) (unpublished)
In equitable distribution, clients often ask whether gifts to one spouse during the marriage is going to be subject to division. Below, we see a simple case example of how the law treats these gifts and the evidence that supports the legal conclusion: Continue reading →
Wall v. Wall, 140 N.C. App. 303 (2000).
Former spouses in North Carolina can split their property in an action for Equitable Distribution (ED). In order for the Court to make a decision on distributing property, it needs an inventory affidavit of all property owned as a product of the marriage. Occasionally, and especially in cases involving high-income parties, the inventory list can be extensive. Many times, there can be arguments regarding values of property. This can lead to some delay between the day of the hearing and the day of entry of a Judgment. Continue reading →
Suppose that you are recently separated or divorced and have minor children. Should you have a life insurance policy in place to ensure sufficient resources are available to provide for your children if you suddenly die? What factors must you consider before taking out a life insurance policy to benefit your children? Should you enter into any agreement with your former spouse to carry this insurance? The answer to all of these questions is probably no. Continue reading →
Ubertaccio v. Ubertaccio, 588 S.E.2d 905 (N.C. App. 2003) (Levinson, J. concurring)
In North Carolina, Equitable Distribution (ED) is one of the common mechanisms by which former spouses divide their personal and real property. Stock options and salary substitutions acquired by a party are typically subject to ED. However, not all stock options are genuine stock options on their face. Nor should all forms of deferred compensation be subject to ED. Below, we discuss a Judge that agreed with the outcome, but not on the rationale of classifying a “stock option” in ED. Continue reading →
Suppose you inherit money from a family member during your marriage. Is your inheritance subject to being divided under North Carolina’s equitable distribution statute? The brief answer: it depends.
North Carolina General Statute § 50-20 defines marital property as all real and personal property obtained and currently owned by either or both spouses during the marriage and before the date of separation unless that property is determined to be separate or divisible property. Separate property under N.C.G.S. §50-20 is real and personal property acquired by a spouse before or during the marriage through devise, descent, or gift. Applying the definitions of marital and separate property from N.C.G.S. § 50-20, any money or property you inherit from a family member would be separate property. Continue reading →
Generally, military disability benefits are exempt from distribution in equitable distribution actions. Here we see whether the court can consider these benefits as income to satisfy a distributive award pursuant to an equitable distribution order. (In this case, Plaintiff improperly filed a Rule 60 motion to set aside the judgment, which is outside the scope of this blog.) Continue reading →