What Would a Court Do: Property Division and Cash Flow (Part 2)

As a collaborative attorney, I am often asked “what would a court do?”  Although parties in a collaborative divorce are not asking the court to make decisions in their case, what the law is and how a court may view an issue is important.  It is part of the information that a client needs to understand to truly make a decision in their own best interest. I recently attended an education series with local judges to gain an understanding of the current state of the law. In the second part of this 2 part series, I outline some of the factors a court may consider in making litigated decisions. On property division and cash flow, here are some of the considerations:

• When dividing assets and liabilities, the courts often begin with an accounting and confirmation of all real estate, accounts, retirement assets, investments,  stock options, inheritances,  gifts,  debts,  personal property, vehicles, and all other possessions.
• The courts have to differentiate between marital property that was created or acquired during the marriage and non-marital property that should stay with one party.  Non- marital property may include assets from before marriage,  gifts or inheritances, and student loans.
• Non-marital property stays with the receiving party.  Marital property is divided equitably. This is often interpreted as equally,  although there are some exceptions if the outcome is deemed unfair.
• Division of property is a separate question from cash flow (child support and spousal maintenance).
• Child support in court is often calculated with the guidelines based on percentage of overnights with each parent and incomes.  Then medical expenses and extra curricular activities are shared by percentage of income.
• Spousal maintenance or alimony is a discretionary area of the law. It is based on the needs of the recipient and the ability of the other spouse to provide support.
• Court requires an analysis of budgets and income or potential income of both parties.  It can be difficult to address income if a party has not or is not working.
• Some of the factors for determining support include: length of the marriage, education and age of the spouses with regard to work ability, work history, parenting needs of children, and reasonableness of expenses.
• Because spousal maintenance is one of the most discretionary areas of family law,  it is difficult to find consistent outcomes in the court as every case is decided based on the individual facts (and judge).

A collaborative process is a different paradigm but clients have the same legal rights as parties in court.  Know what the law is and what a court may do and then make well informed decisions. A good collaborative attorney can help in this journey.