Articles Posted in Division of Property

Back in the 1990s, a famous politician once responded to a question under oath by noting that “it depends on what the meaning of ‘is’ is.” While that answer might be puzzling to some, the reality is that, in the law, sometimes outcomes hinge upon small phrases or even single words, and the very precise definition of those terms. The outcome of a Florida case not too long ago hinged upon what the definition of a “sale” was. Recently, here in Maryland, the outcome of one ex-wife’s case alleging her ex-husband violated the couple’s marital settlement agreement rested squarely upon two things:  whether a thing qualified as an “asset” and whether that asset had an established, non-speculative value. All of these very nuanced details had the potential to have major consequences, and they highlight why it is so important to have skilled Maryland divorce counsel on your side.The couple, R.G. and S.G., began divorce proceedings in 2012 after 25 years of marriage. Seven months after the wife filed her divorce petition, the husband had a dream. That dream was the origin of a groundbreaking invention – a flossing toothbrush. The husband consulted one of his former patients, a businessman, about the invention, but he did not consult a patent attorney right away. Allegedly, the husband was trying to avoid leaving a “trail” that could provide the wife with an opportunity to claim the invention as a marital asset.

The couple entered into a mediated marital settlement agreement on Nov. 18, 2013. Sixteen days later, the husband contacted a patent attorney. In late January 2014, the divorce became final. A week later, the husband filed a provisional patent application for his toothbrush invention. The following November, the wife brought the husband back into court, asserting that he violated the settlement agreement when he failed to disclose the idea for the invention. Specifically, the wife alleged that the husband violated the “Disclosure” paragraph, which required that each spouse disclose all of the assets in the litigation. An improper non-disclosure, according to the agreement, meant that the injured spouse would receive 50% of the value of the undisclosed asset.

The question in this case was, what is an asset? When does a thing become an asset, and even if it was an asset, was the husband’s non-disclosure a violation of the agreement? The husband argued that the idea for the invention was not an asset and had no value as of the date that the spouses signed the settlement agreement.

With modern technology comes modern problems. That can be true in divorce as in other legal areas. One aspect of this is the very contemporary issue of electronic/digital assets. Digital assets can be complicated, as one person’s electronic files may be housed on a computer, hard drive or other storage device that belongs to another. Because these digital files may be things like emails, photos or videos with high sentimental value, those that are potentially embarrassing or harmful, or digital documents with important personal or financial information, resolving the distribution of these assets in a divorce is very important. To make sure that all of your assets, both electronic and physical, are distributed properly, be sure you have an experienced Maryland family law attorney on your side.

A recent case from Anne Arundel County was an example of this type of dispute. In the divorce, the husband agreed that he would return all of the wife’s computer files. This included the email archives from several email accounts.

The husband did not return all the files, however. The wife went back to court, this time seeking an order declaring the husband in contempt for his failure to deliver the files. The husband declared that he had deleted many of the files “in a fit of rage” a year before the spouses established the agreement for delivery of the emails. The wife then asked to review the husband’s hard drives. He asserted that the hard drives were damaged in his move out of the marital home and that he had thrown them away.

Distributing marital property can be one of the most complex elements of any divorce, especially one in which minor children are not involved. Sometimes, in order to achieve a genuinely equitable outcome, it may be necessary for a trial judge to order one spouse to make a monetary payment to the other. There are certain rules that govern monetary awards, though, and if they are not followed, the spouse ordered to pay may be entitled to get the order thrown out. All of these concepts and litigation strategies highlight how having an experienced Maryland property division attorney can provide a substantial benefit to you in your divorce case.

The divorce of Samuel and Joyce, a couple who separated after nearly 30 years of marriage, was an example of a monetary award case that ended in a successful appeal. In dividing the couple’s assets, the court concluded that, with all of the assets distributed, the husband owed the wife a monetary award of $54,000. A monetary award is something that may be ordered in some Maryland divorce cases when the distribution of assets between the spouses yields an outcome that is not entirely equitable. Requiring one spouse to pay the other a certain sum of money thereby “evens the scales” and achieves the equitable outcome required by the law.

In order to order a monetary award, the trial judge has to do several things and consider several factors. Maryland has created a three-step process to be used to determine if a monetary award is appropriate. First, the judge must divide assets into the categories of marital and non-marital. Second, the judge must assess the value of all of the assets that are determined to be marital. Third, the court must decide if dividing the assets “according to title” would be unfair to one spouse.

Most areas of the law, including family law, are evolving and changing constantly, to one degree or another. Ensuring that you give yourself a good chance of success means working with a knowledgeable Maryland divorce attorney who is up-to-date on all of the new changes in the law. These changes can occur through a variety of means, whether it is a new ruling from the Maryland Court of Appeals, a new law enacted by the legislature, or, as was the case in one couple’s military pension dispute, a recent U.S. Supreme Court decision that effectively upturned several decades of Maryland caselaw.

The spouses in the case, Walter and Verdena, were married from 1972 to 2004. During the marriage, the husband served in the Army National Guard from 1985 to 1987. (He previously served before the marriage from 1969 to 1971.) During his four years in the National Guard, the husband suffered three injuries. The husband retired from the National Guard in 1998 and filed for retirement at that time.

The couple’s 2004 divorce judgment stated that the wife was to receive one-third of the marital portion of the husband’s military pension benefits. In 2009, though, the husband sought a re-evaluation of his disability status. The government increased the husband’s disability rating, which meant that he was entitled to receive 30 percent of his compensation as disability benefits, instead of the previous 10 percent.

When you go to court in your divorce case, you may think that the key in your case is your factual proof, whether it is proof related to the value or nature of your spouse’s and your assets, the amount of income your spouse and you make (for the purposes of alimony or child support), or how the court should adjudicate child custody and visitation. But there is much more to most cases, including complying with the procedural rules related to how you get your factual evidence before the court. Knowing how to submit evidence in a compliant manner, as well as knowing how to respond when your spouse doesn’t follow the rules, can be as important a part of your case as the facts themselves.

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Trials and court hearings, in some ways, can be like sporting competitions. Both litigation and sports have their own sets of rules. Some of these rules may seem excessively technical and unnecessary, but they are the rules, and you overlook them at your peril. For example, the rules of civil cases say that generally, if you want the judge to order a particular outcome, you must expressly ask for it in your court pleading documents (meaning your complaint if you are the petitioner or your answer or counter-complaint if you are the respondent). In the case of one Maryland husband, his failure to follow this rule cost him the opportunity to obtain his part of the marital portion of his wife’s retirement benefits, according to a Court of Special Appeals decision.

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It is not uncommon for a married couple to spend the first 25 to 30 years of their life together working and saving money to enjoy in retirement. Over the course of their lifetime, spouses often invest money in stocks, 401K plans, education plans, pension plans, real estate, and other investment opportunities. Ideally, the couple will have an opportunity to enjoy the results of their labor in retirement together. But an interesting phenomenon is taking place. A large percentage of the baby boom generation is seeking to divorce, resulting in some unexpected financial consequences. If you are considering a separation or divorce at any stage of your life, it is extremely important to protect your financial interests, including any investments. You are encouraged to contact an experienced family law lawyer, someone who understands the local divorce laws in Maryland.

According to a recent article, since divorce among people age 50 and older is so widespread, it is becoming known as a “gray divorce.” The author points out that divorce for this age bracket raises several unique concerns involving how each spouse will retire now that the so-called “nest egg” must be split in two. For instance, in a typical divorce, Maryland law allows for the periodic payment of alimony to one spouse. The ultimate goal of alimony is to give the “supported spouse” an opportunity to become self-supporting. When a court awards alimony, it is intended to be “rehabilitative alimony” for an allotted period of time to enable a dependent spouse to become self-supporting.

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The marriage of two people is a joyous event. A couple that decides to marry is expressing hope for their future lives together. Despite their love and devotion for each other, spouses sometimes enter into a “prenuptial” or “ante-nuptial” agreement prior to their wedding day. Such agreements may include various terms, depending on the circumstances of the parties, but they typically set forth the distribution of certain assets in the event of a divorce. Entering into a prenuptial agreement may be considered a prudent course of action, especially if one party has a significant amount of wealth at the time of the marriage. To determine whether a prenuptial agreement is right for your circumstances, you are encouraged to consult with a Maryland family law lawyer as soon as possible.

Essentially, a prenuptial agreement is a contract. And while there are no specific Maryland laws that govern prenuptial agreements, the formation and enforceability of such a document is subject to general principles of contract law. For instance, the parties must mutually agree to the terms of the agreement, which should be in writing. If a couple with a prenuptial agreement seeks to divorce, courts are often called upon to determine the validity of the document. In so doing, courts will look at whether:  1) the agreement was fair and equitable; 2) the parties each gave a full, complete, and truthful disclosure of their assets prior to document signing; 3) each party entered into the agreement freely, voluntarily, and knowingly; and 4) each party sought independent legal advice prior to signing the agreement.

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Maryland is an equitable distribution state. This means that in divorce, property and debts acquired during the marriage are subject to “fair and equitable” division (subject to limited exceptions). The law does not guarantee that marital property will be divided equally. For the most part, marital property includes items such as bank accounts, businesses, homes, automobiles, stocks, jewelry, furniture, retirement plans, pensions, and other property acquired during the marriage. Interestingly enough, Maryland does not include the value of professional degrees or licenses earned during the marriage.

Based on this list, it should be clear that a couple’s marital property potentially could be worth a great deal at the end of a marriage. If you are considering separating from your spouse, it is important to preserve your interests in, and rights to, assets acquired during the marriage. One of the best ways to protect your legal and financial rights is to speak with an experienced Maryland family law attorney as soon as possible.

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In most states throughout this country, including Maryland, when a couple seeks to divorce, they may agree to divide up marital property or otherwise be subject to the court’s division of any assets and debts accumulated during the marriage. A critical stage in every divorce case involves the identification and characterization of property subject to division. One hopes that the parties will be honest and disclose all marital assets. But in some cases, spouses may not be completely forthcoming and actually attempt to conceal certain assets. For these reasons alone, it is important that anyone considering a divorce take steps to protect their financial future. One way to do that is to consult with an experienced family law attorney who handles divorce and separation cases on a daily basis.

Under Maryland law, marital property is all the property that you or your spouse accumulated during the marriage, including your bank accounts, houses, cars, furniture, businesses, stocks, bonds, pensions, retirement plans, IRAs, and jewelry. While some states also include the value of professional licenses and degrees, Maryland does not. Some items that are not considered marital property, even though they were acquired during the marriage, are gifts from a third party, something inherited by one spouse alone, or something that the couple mutually agreed would remain separate property.

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