Division Of Property in Law and Divorce Mediation in New Jersey and New York
In New York and New Jersey, the division of property or ‘equitable distribution’ is the dividing of assets that a couple has acquired during their marriage. It is important to note that ‘equitable’ does not necessarily mean equal, and that there are a number of reasons why one spouse could have a legitimate claim to more than half of the couple’s marital assets during their divorce.
This property acquired during their marriage is known as Marital Property. When determining just how it will be divided, a couple goes through all of the assets and debts acquired together, assess each items worth and then splits it up fairly. The couple can do this alone, with a third party, or if otherwise unable to reach a settlement, through a court order. Though, if you cannot readily agree on how to deal with division of property the assets, it is important to have an experienced professional, whether an attorney or divorce mediator, as your guide.
In order to ensure that you receive not only your fair share of marital property, but the specific assets you desire to keep following your divorce, contact The Berner Law & Mediation Group to help you through the division of property process.
What Is “Separate Property” In New Jersey And New York?
Separate Property refers to property acquired before the marriage or acquired during the marriage by way of a gift, inheritance or personal injury claim by one spouse during the marriage. When a spouse has contributed separate property to a marital asset, they may be entitled to a separate property credit against that asset. Typical assets to be divided include homes, bank and investment accounts, retirement accounts, vehicles, businesses, jewelry, art, and antiques.
However, there are numerous exceptions that can convert previously separate assets into marital property, presenting one of the greatest challenges in the division of property process. For this reason it is even more crucial to seek out the help of an experienced attorney who can guide you through this process.
What Impacts Equitable Distribution?
Splitting up marital property, assets and debts through equitable distribution can be both time-consuming and complex. When resolving these issues, the New Jersey and New York courts will take into account a wide range of factors, including:
- The length of the marriage
- The age and relative health of each spouse
- Any property brought into the marriage
- Custodial responsibilities for the children
- Relative incomes and earning capacities
- Debts and liabilities of each party
- Written agreements made prior to or during marriage regarding how property will be divided in the event of divorce
This list also includes virtually any other factor that the court deems relevant to the case. Moreover, although the New Jersey equitable distribution statute recognizes certain categories of separate property, any separate property allowed to co-mingle with marital property is in jeopardy of losing its status as separate.
Active Vs. Passive Assets
One key concept of inequitable distribution is the difference between active and passive asset appreciation.
- Active appreciation occurs when an asset increases in value based on someone’s hard work. For instance, if you build a hotel on a piece of property, the appreciation that results is active.
- Passive appreciation occurs when an asset increase in value without any effort from the parties. For instance, if you own stocks, those stocks may increase in the value of their own accord.
Generally, active appreciation in the value of a premarital asset is subject to equitable distribution, but passive appreciation is not.
In some cases, a judge will order property to be liquidated and the proceeds divided between spouses, but most cases do not involve liquidation.
Typically, a judge will approve alternative distribution, especially when real estate is concerned. For instance, the husband may surrender a larger portion of her retirement account in order to keep all the equity in the house. Or, the wife could receive a lien for his portion of the equity and when the house is later transferred, that lien must be satisfied.
Amending Equitable Distribution
It is important to remember that, unlike alimony, equitable distribution would be amended by a court after the fact as a result of “changed circumstances.” It is important to keep this in mind during negotiations. Once a deal is made, the Court may not allow you to revisit the issue in the future.
Contact An Attorney To Assist With The Division Of Property
There are so many factors in play when dividing up property that it can be a very complicated process. By hiring a New York or New Jersey property division lawyer or divorce mediator, you can help make sure that you get your fair share of marital property and protect any separate property you have.
The Berner Law & Mediation Group recognizes that the that the distribution of joint property, and at times what is your property can be trying, and one legal misstep can result in decisions that may cost you precious items, money, and memories.
Call our New Jersey or New York office today to see how we can help you through the division of property process.