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What in the World is Divisible Property?

What in the World is Divisible Property?

What in the World is Divisible Property? By Amy A. Edwards Marital property is property that a married couple owns when they separate, as long as they acquired it during the marriage. Separate property includes property that you owned before marriage, property that was a gift to you individually, or inherited property. In 1997, North Carolina created something else, divisible property. [1] This article barely scratches the surface of it, and does not include divisible debt. What’s Included in “Divisible Property”? Only property owned on the date of the separation is marital property. But what happens to marital property after you separate? The time from the date of separation until the date that the case finally reaches the courtroom can easily be a year or longer. If the value of a marital asset changes, the court will decide what to do with that change in value. If the court says the change in value of marital assets is divisible property, the amount of that change will be divided 50/50. Otherwise, the change in value will not be divided and that change in value is kept as separate property. For Example . . . Assume your home is worth $200,000.00 when you separate, and that you still live there. By the time you reach the courtroom, after 13 months have passed, the value increases to $225,000.00. The judge will decide whether that $25,000.00 difference in value is divisible property. If so, it will be equally divided and each spouse would get value worth $12,500.00. On the other hand, if the difference is not divisible property, that increase in value is the separate property is yours. What Makes the Change in Value Divisible? The increases and decreases in the value of marital property after separation are assumed to be divisible property, and divided equally. This assumption is based on things such as inflation, changing economic conditions and market forces, the mere passage of time and changes in tax assessments. These increases in value are divisible property because they are natural changes, which the court calls these changes “passive” in nature, generally beyond either spouse’s control. What Makes the Change in Value Separate or Shared Property? Although the law assumes that the change in value is divisible property and equally divided because the change in value was passive, you can offer evidence to show why the change in value is not passive....

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Can’t We Just Pick a Date of Separation and Get Our Divorce?

Can’t We Just Pick a Date of Separation and Get Our Divorce?

Can’t We Just Pick a Date of Separation and Get Our Divorce? We hear this question all the time. The short answer is no, you can’t choose a date of separation. In the real world, efficiency and common sense would suggest that you could. But this is not an agreement to apply for “services” from the government. It is a lawsuit, and a judge must use the law. Divorce is a legal status, similar to a legal status of biological parent in a paternity case, for example. Each state has laws dictating how long a married couple must be separated before they are eligible to divorce. Here in North Carolina, the law requires a one-year separation. This should not be confused with our residency requirement. It requires at least one spouse to live in this state for six months before he or she is allowed to file a claim for divorce, even if the parties have already been separated for a year when one spouse moves here. All Divorces Are Lawsuits It can be easy to forget that even uncontested divorces are filed by a plaintiff, served on a defendant, and ruled upon by a judge. In fact, most people don’t even have to be in court. Except for incurable insanity, the only ground for a divorce in North Carolina is a one-year separation. This requires that at least one spouse intends for the separation to be permanent, although there is no requirement that the lawsuit say which spouse intends to remain apart. Examples of one-year separations that don’t fit into this category are couples who are only separated by military service or incarceration. They are not separated unless one spouse intends to remain separated (i.e., that person does not want to move back home when no longer physically separated). The divorce complaint, the document that starts the lawsuit,  cannot even be signed until the day after the year has passed. When you sign the complaint, you do so under oath, under penalty of perjury, which is a crime. Worse yet, if you lie about the DOS, your fraudulently obtained divorce can be set aside (voided) because you were not separated for one full year. Why Do We Have to Wait a Year? The government doesn’t want you to have a fight with your husband or wife, separate for a few days or weeks, get divorced and then reconcile...

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Is Credit Card Debt Marital?

Is Credit Card Debt Marital?

Is Credit Card Debt Marital? By Amy A. Edwards In short, credit card debts can be marital, just as any other type of debt. In contrast with marital property, the law doesn’t assume a debt is marital just because it was incurred during the marriage. If a debt is marital, each party is equally responsible for it, although the court usually assigns it to one party to equalize the net part of property each party gets. If a debt is separate, it isn’t calculated into the marital estate, and the person who has the account in his or her name is responsible for it. To understand credit card debt, we must first look at what a marital debt is. The Timing of Marital Debt A marital debt must generally be incurred by one or both spouses while they are married and before the date of separation (DOS). One exception to that rule is when one spouse takes a loan after DOS to pay off the “old” marital debt that existed on DOS. [1] Like marital property, marital debt must exist at DOS. If you just paid off your credit card with your bonus from work, and then you separate, the debt doesn’t exist at DOS and it is not a marital debt for which you would get credit for paying. What’s in a Name? Marital debt can be in the names of one spouse or both. However, there is one important distinction between debt and marital debt. The court can say who is responsible but only as between two spouses. But the court can’t tell a third party, such as Mastercard or Visa, that they can only enforce the debt against one person when two people signed the agreement to repay them. The court may indemnify a spouse, meaning that if the husband is assigned to pay the credit card debt and he fails to do so, he has to repay the wife if the credit card company sues her for payment. But if the other spouse had the money to repay you, he or she would’ve probably paid the debt in the first place. In practice, indemnification only goes so far. Joint Benefit: The Key Issue Unlike marital property, to call a debt marital, it must be incurred for the joint benefit of the parties. [2] There is no presumption that the debt was incurred for the benefit of both parties. If you want to prove...

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Standing: Who Can and Can’t File for Child Custody

Standing: Who Can and Can’t File for Child Custody

Standing: Who Can and Can’t File for Child Custody The ability to file a legitimate lawsuit for child custody is extremely limited. A person must have “standing” to file, which “relates . . . to the right of the party to have the court adjudicate a particular dispute.”[1] You must have some vested interest in something before you can even ask the court to rule on the controversy. Which Parents Can File? Parents automatically have standing to file for custody against each other because they both have equal constitutional right to the care and custody of their child. They have equal rights to their child unless there is a court order or they have a custody agreement. However, our statutes forbid anyone who is convicted of the following crimes, and which resulted in the conception of the minor child, from filing a child custody claim: first-degree forcible rape, second-degree forcible rape, statutory rape of a child by an adult or first-degree statutory rape. [2] Which Non-Parents Can File? When non-parents have custody, they are usually family-members because they are likely to see the child regularly, care for the child or have a strong bond with the child. It has little to do with which relative asks for custody. Instead, it has everything to do with the behavior of the parents. A non-parent only has standing to file for custody in the event that both parents are unfit or have taken actions that are inconsistent with their constitutional right to the care and custody of their child. This standard is the same as any non-parent. This even applies to grandparents who cannot sue for custody merely by virtue of their status as grandparents, although they may seek visitation in limited circumstances. Who Else Has Standing to File? Proving that the parents are unfit or that they have acted inconsistently with their rights is a huge hurdle. Constitutional rights protect parents who are merely adequate, or parents who don’t do a good job of parenting. But if the non-parent proves the parents are unfit or behaved inconsistently with their rights, our statutes set out a very broad list of potential custodians: “Any . . . other person, . . . claiming the right to custody . . . may institute a . . . proceeding for the custody of such child. . .” [2] But the non-parent cannot be a stranger to the child. He or she...

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What is Marital Property in North Carolina?

What is Marital Property in North Carolina?

What is Marital Property in North Carolina? Before 1981, our state had traditional title ownership. This meant that the assets would be awarded to the person in whose name they were owned if a couple divorced. If the house or vehicle was in the husband’s name, for example, the wife received no share of the value for it. Reform: Equitable Distribution Some states have what they call community property. Instead, we use a process known as Equitable Distribution to divide marital property. After a particularly harsh result in a 1979 case that demanded reform, an equitable distribution statute was created, NC Gen. Stat. §50-20. Title ownership was fairly straight forward, but the newer process has lots or grey area. Instead of strictly using the law to simply look at the name on the deed or car title, the statute requires judges to divide property fairly (i.e., equitably) between spouses. When the court decides property is marital, it is given to (i.e., distributed to) one spouse or the other, even if his or her name is not on the title or other ownership title. Equity gives the judge discretion to award assets as he or she sees fit, so long as it is within the terms of the law. The law requires judges to divide marital property equally unless one uses his or her discretion to do otherwise when there are special reasons. Marital Property Definition Marital property includes land and personal property that is acquired by either or both spouses during the marriage but before they separate. It must also be owned at the time they separate. If it meets these requirements, the property is legally presumed to be marital. In other words, if a spouse wants to show that property is his or her separate property, he or she must prove it is separate property. To beat the legal assumption that it is marital property, he or she must prove the property was acquired before they married, after they separated, or acquired by a spouse by devise (property transferred by a will) or by descent (property inherited upon death). What Counts as Property? The current statute includes just about everything with a dollar sign on it, and a few things that don’t have any real value, such as photo albums, or even a negative value such as an overdrawn bank account. Other examples you might not think of include cemetery property,...

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