Equitable Distribution of Assets in a New Jersey Divorce
The term “equitable distribution” refers to the process used by New Jersey courts to divide “marital” assets and debts in a New Jersey divorce.
The process involves three steps:
First, the Court must decide what assets and debts of each party are “marital” and thus eligible for distribution.
Next, it must determine the value of each marital asset and debt; and
Last, the Court must decide the most equitable allocation of those assets.
Step 1 seems simple. A “marital” asset is one which was accumulated during the marriage, right?
Not necessarily. In another blog post, we’ll talk about the issue of when the marriage ends for the purpose of New Jersey equitable distribution. (It’s not when the Judgment of Divorce is signed).
But how about the issue of when a marriage begins? The answer seems simple, but it may not be—at least for the purposes of equitable distribution.
Consider the case of a person who purchases a home in his/her sole name during the engagement period, does not change the house title at the time of the marriage, and then gets divorced after living in the house with his spouse.
Most people would think that, because the home was purchased before the marriage and is not in joint names, it is not a marital asset and is therefore not subject to equitable distribution. But under certain circumstances, wouldn’t that be unfair to the spouse?
The answer is “yes.” In Weiss v. Weiss, 266 N.J. Super. 281 (App. Div. 1988), an appeals court was asked to reverse the decision of a New Jersey Family Court trial judge who had awarded the wife a 50% interest in the parties’ home–even though the husband had purchased the home in his name only during the parties’ engagement.
Based on an analysis of the following three factors, the Court held that a date prior to the wedding may be considered as the date of the commencement of the marriage for the purposes of deciding whether property is a marital asset subject to equitable distribution:
Whether both parties participated in the decision to buy the home.
Whether the parties intended for the home to become their marital home at the time of purchase; and
Whether the party who does not hold title in the home was actively involved in making improvements to the home, both before and during the marriage.
Because the wife in Weiss had satisfied all three requirements, the appeals court held that the marital home was an asset purchased in contemplation of marriage, and that it was subject to equitable distribution.
The Weiss case illustrates that when it comes to equitable distribution—and many other issues that arise in New Jersey divorce cases–a question with a seemingly simple answer is actually much more complex. That is why it is crucial to have an experienced and knowledgeable divorce attorney by your side as you navigate the divorce process.
Salvaggio Law Group LLC devotes its entire practice to New Jersey divorce and family law matters, including equitable distribution. If want to talk you call us at (973) 455-1220 or fill out the Contact Form on our website.