Common property distribution
The states/provinces that do not follow equitable distribution are considered common property divorce states/provinces, where all property of a married person is classified as either community property, that is owned jointly by both spouses, or considered the separate property of one spouse. In these states/provinces, marital property refers to the property acquired by either, or both spouses during the marriage. Separate property refers to any property the spouses acquired separately before the marriage, or after. Separate property also includes any gifts, or inheritances acquired by either spouse at any time. There are exceptions to general rules, which are outlined in each state/province’s property laws. When divorce is finalized, community property is generally divided equally between the spouses, while each spouse keeps his/her separate property.
Property distribution (Canada)
Under Canada’s Constitution, each province and territory is responsible for laws regarding the division and/or equalization of family or marital property, and these laws can vary from one province or territory to another. The theory that is applied to most family assets, with the exception of some is: “The value of any property that you acquired during your marriage and that you still have when you separate, must be divided equally between spouses. Property that was brought into your marriage is yours to keep, but any increases in the value of this property during the duration of the marriage must be shared.”
A court will review a number of factors in determining how to divide marital property, including:
- The financial condition and earning power of each spouse
- The value of each spouse’s separate property, including a spouse’s business, investment interests, 401(k)/pension, etc
- Each spouses’ contribution to the acquisition of marital property
- Each spouses’ contribution to the education and earning power of the other spouse
- Future financial needs and liabilities of each spouse
- The ages and overall health of each spouse
- The liquidity of marital property
- Premarital and prenuptial agreements
- Spousal maintenance, or alimony obligations
An attorney at The Bobb Law Firm PLLC can draft a marriage settlement agreement after input from clients regarding factors that a court would consider for a final order of distribution of marital property. A detailed marriage settlement agreement has a higher chance of accord from the other spouse and his/her attorney. Experienced divorce lawyers will utilize their legal expertise to draft an agreement that maintains financial stability for their clients, while adhering to all pertinent financial business, real estate, and tax laws of the state/province where the divorce is filed.