Equitable distribution involves identifying assets and liabilities of the parties; determining if they are marital; valuing them, and distributing them. As with other areas of family law, this sounds simple, but is riddled with complexities that have a huge impact on the final judgment in the case. Working with our clients, we do a deep dive on the assets and liabilities in each case to ensure clients get what is fair. Let us be your partner in identifying, valuing, and distributing those assets and liabilities.
Often parties in a divorce case complain that the other party is hiding assets. We have worked cases that have involved hiding classic cars, cash, gold bars, silver bars and other valuable items and accounts. We work with our clients to identify hidden assets and value them. Tracking down all of these assets is usually possible when utilizing all the discovery and investigative tools at our disposal; but can require a lot of work in reviewing financial information and otherwise tracking down these assets.
One of the biggest issues in an equitable distribution case is valuing the assets. This can be fairly straight forward when it comes to something like a vehicle or a bank account, but can be much more complicated when it comes to something like a business or an antique. When it comes to valuing these more complicated assets, an appraisal or a business valuation is often necessary. Determining a precise value at the date of separation of the parties is very important to ensuring an equitable distribution. We work with our clients to identify thee issues early in a case and take appropriate action to make sure we are in a position to get the correct value for each item.
Non-Marital Assets & Liabilities
Non-marital assets and liabilities are those assets and liabilities that are not part of the marital estate and thus not subject to being equitably distributed. These usually include inheritance, gifts received during the marriage made only to one party and anything acquired before the marriage or after the separation. There are many exceptions to this general rule, so if you think an item is non-marital, make sure to discuss it with your attorney. Identification of these assets and liabilities is vital as you don’t want your soon to be former spouse to get half of an asset to which they have no claim. You also probably don’t want to be responsible for half of your former spouses’ student loans if they were taken out before the marriage. When claiming an item is non-martial, the burden is on the party making the claim. This means if you believe one of your assets is non-marital and should not be divided, the burden is on you to prove it. Gathering and preparing such proof is vital to both a potential settlement in the case and a final hearing on the issue if you are not able to settle the issue. Working closely with your attorney is the best way to identify and value these assets and liabilities.
The 50-50 Presumption
North Carolina Statutes require that all equitable distribution orders be “equitable” and presumes that “equitable” means “equal”, unless there are reasons to do otherwise. The statutes (Section 50-20, N.C.G.S.) then lays out all of the potential reasons to do an unequal distribution (12 total factors), of which includes “any other factor which the court finds to be just and proper.” Essentially, the court has wide discretion to do an unequal distribution if it so chooses. However, while claims for unequal distribution are very common, and are even included in some cases where there is no legitimate claim for an unequal distribution, the vast majority of cases are resolved with an equal distribution of assets and liabilities to both parties. It is generally considered rare to see a court order that has an unequal equitable distribution. In those cases where there is an unequal distribution, the typical factors justifying the unequal distribution are: to preserve a home for a minor child; when there is a large income differential between the parties; when there has been a large outside contribution to the marriage, such as a gift to both parties by the family of one party.
Claims for Unequal Distribution
Successful pursuit of an unequal distribution in your favor is possible when supported by the facts of your case. Further, unequal distributions are frequently utilized in settlement agreements, where the parties have more discretion to negotiate such issues. Building a claim for unequal distribution takes careful planning and you should seek the assistance of an experienced attorney with such a claim. Such a claim should be made in your complaint or counter-claim and should be supported by a short and plain statement of why an unequal distribution is justified in your case.
Whether your equitable distribution case is simple or complex, speaking with an experienced attorney about your case is the best way to make sure your rights are protected. Contact us today to make an appointment to discuss your case.