Equitable Distribution relates to how property is divided between a couple when they get divorced. Prior to equitable distribution in New York, the main concern was who owned what. Now the law recognizes that a married couple are both entitled to a portion of the assets regardless of whose name is on the title.
The thing to realize is that “equitable” does not mean equal. It means that the distribution is fair and reasonable. It is up to the court to decide what fair and reasonable could mean in each case. The decision is not based on a gut reaction. It is based on a set of guidelines in which consideration is given to items such as what income and property each spouse brought into the marriage, how long the couple has been married, the age and health of each spouse, who has custody of the children, what sorts of benefits, pensions, or insurance a spouse will lose as a result of the divorce and what sort of maintenance is being paid.
With such a list of variables, finding that equitable balance can be a challenge to all involved. As mentioned, when we were dealing with a common law system, the name on the title was all it took, but now, even if a spouses name is not on the title, there are other factors that come into play. Such as who maintained the house and each person’s role as the primary money-earner, homemaker, or stay at home parent. Sometimes it is more than money that allows a person to build equity in a property, it is time, effort, and labor that a spouse can point to argue a case for the equitable distribution to include a certain asset.
For the most part, equitable distribution takes into account the assets gained during the time of the marriage. If either spouse had property prior to the marriage, that property is most likely going to stay with that spouse. Other types of property are likewise exempt, such as property received as an inheritance specifically to one spouse or as a result of a personal injury to one spouse. Any pre- or post-nuptial agreement will also be taken into account.
When figuring what is fair and equitable, a judge takes history into account as well. They do not look at a snapshot in time. A one-time snapshot may not find that a spouse has been either reckless with spending or is otherwise trying to hide assets from the process in order to maintain unfair control of certain assets. This sort of underhanded behavior does not alleviate a person from the responsibility of subjecting marital property to the scope of equitable distribution.
Quite often when people discuss property they are discussing real estate or monetary assets. If there is a business owned by a spouse, that business may also be on the table in the discussion of equitable distribution. While one spouse owns the business, the other spouse may have taken on additional responsibilities related to the fact that there was a business to run. Even prior to the business the other spouse might have been the sole-money maker supporting the family while the business owner was getting an education or earning a degree related to their field. Oftentimes, distribution of a business is difficult to estimate. In some cases, the spouse may be unable to have ownership if the ownership requires a certain license to be obtained, as in a law or medical practice or any business that requires a state obtained license. When this is the case, the judge may substitute other marital assets to offset the portion of the business in the interest if being equitable.
Distributing marital assets in an equitable manner during a divorce can be extremely complex. With the assistance of an experienced attorney, you can ensure that your rights are protected. Don’t let your spouse take what is rightfully yours or leave you struggling financially. If you are divorcing in the Nassau County or Long Island area, contact Anthony J. LoPresti, to discuss marital property division during a free one-hour consultation. Call (516) 252-0223 today to set up an appointment.