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Family Law | Equitable Distribution: How a Court Separates Marital Property

When a couple gets married in Minnesota, each spouse brings things into the marriage items or funds which are the property of the individual. Once the two become one in marriage, most of the property they acquire while married is considered marital property, effectively belonging to both spouses jointly. There are some exceptions to the rule; inheritances, certain gifts and any property purchased with non-marital funds belong to the owner alone. As long as the couple stays married, the property belongs to both partners. However, if the couple decides to divorce, the court will divide the property between the two in a process called equitable distribution.

Equitable Does Not Necessarily Mean Equal

In a 2005 case before the Court of Appeals of Minnesota, Sirek v. Sirek, the court set forth an important pronouncement about property division: While the district court must make a just and equitable division of the marital property, an equitable division of marital property is not necessarily an equal division. In order to divide marital property, the court must first make findings regarding the division of the property. The findings are to be based on all relevant factors, including the length of the parties’ marriage, any prior marriage of a party, age, health, occupations, amount and sources of income, vocational skills, employability, liabilities, needs and the opportunity for future acquisition of capital assets of each party.

The court will look at each relevant factor, but an example of a court’s review of the health issue may play out as follows: If one party is coping with a serious illness while the other spouse has never taken a sick day, the court may find that the sick spouse deserves more from the property division than the healthy spouse in order to help cover medical bills. If one spouse has a six-figure yearly income while the other party may never earn much more than minimum wage due to lack of education or job skills, a court could take that into account when opting to divide the property in a way that provides more to the spouse with the lower-paying job.

A court dividing property will also look to the contributions each spouse made to the acquisition, preservation, appreciation or depreciation in the amount or value of marital property. Thus, if one of the spouses does maintenance and upkeep on the marital residence which results in the preservation of the home, that spouse may receive a higher percentage of the equity even if he or she did not contribute as much financially to the purchase of the home in the first place.

Commingling of Property

What happens if a spouse commingles his or her non-marital property with marital property? If a couple buys their home during the marriage, the house would be marital property. Then, one spouse uses money from an inheritance to build an addition to the home which increases the overall value of the home. In these circumstances, the spouse asserting a claim to the non-marital portion, the inheritance, must adequately trace the non-marital funds in order to establish their non-marital character. If the court finds that the party has traced out how the non-marital funds from the inheritance were used to increase the value of the marital property, it may award the amount of the increased value to that spouse’s share of the equitable distribution.

If you are contemplating a divorce, please contact a family law attorney who can explain more thoroughly the process of equitable distribution.