What are Equitable Distribution Decisions in New York Divorces?
The distribution of assets and debts in New York divorce cases is governed by a legal standard that is known as equitable distribution or equitable division. If you are contemplating a divorce in New York, it is important that you do have a basic understanding of the equitable division of property standard.
The Essential Elements of Equitable Distribution in a New York Divorce
According to the equitable distribution of property standard, the property and debt accumulated during a marriage is divided between the spouses in a manner that is considered fair and equitable according to the specific facts and circumstances of a particular case.
Equitable division of assets and debts does not mean equal. A common mistake that people make when it comes to the equitable division standard is that property and liabilities are divided in half or equally between the spouses.
Fair and just does not always mean equal. In fact, a perfectly equal division of assets and debts would be the exception and not commonplace in an equitable division case.
The equitable distribution standard is used in the vast majority of states. About 10 states follow what is known as the community property standard. California is probably the state best known for using the community property standard in a divorce case.
Unlike the equitable distribution standard utilized in the Empire State, community property does establish a presumption that property and debts should be divided equally in a divorce case. There must be sound reasons provided to the court to deviate from an equal division in a community property state.
Factors Considered in the Equitable Division of Assets and Debts
As mentioned previously, the court examines the specific facts and circumstances in a specific divorce case when making decisions regarding equitable division in a divorce case. These factors may include the earning capacity of each spouse, whether maintenance or spousal support is paid in a case, and which parent will have primary residential custody of children born during the marriage.
Understanding Marital Property
Only marital property and debt are subject to distribution or division in a divorce case. What this means is that certain property and debt accumulated in some manner outside the marriage will not be divided. Non-marital assets and debts are set aside exclusively to the party that acquired it outside of the marriage.
An example of property that would not be considered marital would be a car that a spouse purchased and paid for in full before the marriage. The presumption in a divorce would be that this vehicle would not be included in a marital property distribution.
If one of the spouses accumulated some type of financial obligation before the marriage, that would also not be subject to distribution in divorce proceedings. A student loan is an example of a debt that likely would not be subject to distribution during New York divorce proceedings.
The issue of inheritance may also come into play when ascertaining what is and is not marital property subject to division in New York divorce proceedings. If a spouse inherits property during the course of a marriage, the presumption is that the inherited property would be excluded from the marital asset distribution process in a divorce case.
Asset and Debt Disclosure
At the start of a New York divorce case, each spouse must submit a verified financial statement to the court. This is a recapitulation of assets and debts that is submitted to the court by each spouse.
The parties legally are obliged to submit honest, accurate statements of assets and debts. These documents become a key tool used by the court when it comes to the matter of equitable distribution of assets and debts. The failure to file an accurate, honest statement with the court can result in serious consequences that can include a finding of perjury or contempt.
Property Settlement Agreement
In many divorce cases, the spouses enter into a property settlement agreement. Parties to a divorce are given fairly significant latitude in hammering out an agreement in New York.
Nonetheless, a property settlement agreement must be reviewed and approved by the court. A judge reviews the settlement agreement reached by the parties to ensure its general fairness. The court reviews to make certain there exists not inappropriate overreach or other improprieties when it comes to an agreed property settlement agreement.
Exceptions to Non-Marital Property Exclusion from Distribution in a Divorce Case
Because the equitable division standard necessitates a consideration of what is fair and just in a specific case, there can be situations in which so-called non-marital assets end up being part of a distribution in a divorce case. By way of example, consider an automobile that a spouse initially purchased before the marriage,
If the car was not paid for, and payments for that vehicle were made during the course of the marriage, at least some portion of the value of that car would be considered a marital asset subject to division. This occurs because marital assets in the form of cash was used to pay on the car loan.
On a somewhat related note, if money is used to pay off a preexisting student loan, the spouse who is not a party to that loan would be entitled to an offset in the divorce property distribution for momey paid on that student loan.
Hire a Skilled, Experienced New York Divorce Lawyer
The initial step in hiring a skilled, experienced New York divorce lawyer is to schedule an initial consultation with a member of the legal team at the Spodek Law Group. During an initial consultation, you will be able to obtain more information about the equitable division of assets and debts in a divorce case. A divorce lawyer will also provide you with a complete, comprehensive evaluation about your case.
During this preliminary appointment, you will also have the chance to get answers to any questions that you have about your case. The Spodek Law Group charges no fee for an initial consultation with a prospective client like you.