In an Action for Divorce in the New York State Supreme Court, the Judge assigned to the Action is required, in the absence of an Agreement between the spouses, to distribute marital assets and liabilities.
With a few notable exceptions, “marital property” is defined as property acquired by either or both spouses during the marriage and before either the signing of a Separation Agreement or the commencement of a matrimonial action. The definition of marital property applies regardless of the form in which title is held.
Marital property does not include “separate property.” Separate property is (i) property acquired by either spouse before the marriage; (ii) property acquired by either spouse (even during the marriage) through bequest or gift from someone other than the spouse, and (iii) compensation for personal injuries.
Separate property remains the separate property of the owner and will not be distributed by the Court.
In determining how marital property should be distributed between spouses, the Court enters into a three-step process:
- Identification of an asset as separate or marital.
- Evaluation of the asset.
- Distribution of the asset.
Liabilities are examined in the same manner.
In order to achieve an equitable distribution of marital property, both spouses must provide full and complete financial disclosure of all of his or her income, expenses, assets, and liabilities. Without this information, the Court cannot make a decision and the spouses may not be able to enter into meaningful settlement negotiations.
Spouses are, of course, free to enter into a written Agreement, with certain statutory formalities, in lieu of allowing a Court to make these decisions.
There are many nuances to the Equitable Distribution Law which can be explained to you, in relation to your particular circumstances, by one of our experienced matrimonial attorneys.