Category Archives: Equitable Division

Uncontested Divorce Division of Property

Uncontested Divorce Division of PropertyUncontested Divorce Division of Propertywhat property is divide in an uncontested divorce?  Only real and personal property and assets acquired by the parties during the marriage are subject to equitable property division.  A property interest brought to the marriage by one of the marital partners is a non-marital asset and it si not subject to the equitable division since it was not generated by the marriage. (see Payson v. Payson, 274 Ga. 231 (2001) and Bloomfield v. Bloomfield, 282 Ga. 108 (2007).

The last date on which assets may be acquired so as to be marital assets is the date of the final decree of separate maintenance or the date of the decree of divorce.  (see Friedman v. Friedman, 259 Ga. 530 (1989)

Property acquired during the marriage by either party by gift, inheritance, bequest, or devise remains the separate property of the party that acquired it; and is not subject to equitable division unless the appreciation in the value was caused by efforts of the other party during the marriage. (see Halpern v. Halpern, 256 Ga. 639 (1987).

However, Property does not become a marital asset simply because one of the spouses obtains it during the marriage.  (Dasher v. Dasher, 283 Ga. 436 (2008)).

Gifts between spouses of marital property remain marital property, subject to equitable division.  Also, a gift to a marital couple will become marital property absent evidence of the contrary intent by the donor.  However, a gifts of one souse by the other spouse becomes separate property of the recipient spouse.    (see Bailey v. Bailey 250 Ga. 15 (1992) and McArthur V. McArthur, 256 Ga. 762 (1987).

In a case where the marital residence was purchased by one party prior to the marriage, the other party would be entitled to an equitable share of the net increase in the equity in the marital home attributable to marital funds.  (see Thomas v. Thomas, 259 Ga. 73 (1989)).

Uncontested Divorce Division of Property – If you have questions about an Uncontested Divorce Division of Property or you need help with completing an uncontested divorce – Contact the  Remboldt Law Firm at 404-348-4081.

Additionally, for more information on the Georgia Child Support Calculation Gross Income – you may find the Georgia Child Support Worksheet helpful.  Also, if you are considering an uncontested divorce, you may find the Uncontested Divorce Worksheet helpful in moving forward with an uncontested divorce.

Equitable Division Not Modifiable.

Equitable division not modifiableEquitable division not modifiable.  Here’s an example of a case where the court tried to modify a settlement agreement and failed.

The parties were divorced on October 3, 2007. The final divorce decree incorporated the parties settlement agreement into it making it the Order of the Court, the agreement provided that the marital residence would be placed on the market for sale, and that the net proceeds would be divided equally between the parties. If the house did not sell within two years, the Husband would refinance the marital residence and pay Wife one-half of  the equity at the time of refinancing. The marital residence did not sell; the Husband remarried and purchased a second home with his new wife.  The new home was titled in both of the parties names (Husband and new Wife) and the debt solely in his (Husband’s) name.

The Wife filed a motion for contempt because her ex-husband had not refinanced the home and she had not been paid.  The trial court found Husband in willful contempt, assigned all risk of any deficiency to the Husband, and ordered that the Husband “shall sell or liquidate all available accounts and property and shall pay down the mortgage.”

The Georgia Supreme Court affirmed the willful contempt order, however, reversed the trial court’s directive as not simply a clarification or interpretation of the decree, but a modification of the settlement agreement and divorce decree.  Requiring the Husband to sell or liquidate all available accounts and property and pay down the mortgage was deemed a modification of the settlement agreement.

Equitable division not modifiable.  For more information see the Georgia case, Jell v. Jett, 291 Ga. 56 (May 7, 2012).

If you have questions about a divorce settlement agreement, contempt, or equitable division not modifiable, if you considering filing a divorce, please contact the Remboldt Law Firm, LLC at 404-348-4081 for a free phone consultation.

Sources of Funds and Baseline Value

Sources of Funds and Baseline Value.  Without Baseline Value Of Property Calculation of Appreciation In Value Impracticable.  In the case of Pina v. Pina, the parties married in 1998, and Wife filed a complaint for divorce on December 10, 2008. At issue was equitable division of real property the Wife purchased prior to the marriage. In 2005, she transferred the property into a Trust for the benefit of her three children, two of whom are Husband’s children.  The trial court ruled that the property is the Wife’s separate property, but that Husband has an equitable interest in the property because mortgage payments,  repairs, and improvements on the property were made with marital funds, and because Husband worked on the property during the marriage. However, only the subsequent increase in the net equity attributable to marital contributions is a marital asset, subject to equitable division.

However, considering the lack of evidence of the value of the maintenance work performed by Husband, the testimony of Wife that he was paid for this work, the fact that Husband used a portion of the property rent-free as a commercial recording studio, and the fact that the property paid for the mortgage through its own rents, the trial court had evidentiary support for its finding that any increased value in the property attributable to Husband’s contributions and the expenditure of marital funds was nominal “Calculation of appreciation in value of property during marriage was impractical due to lack ofbaseline value.”

Sources of Funds and Baseline Value.  Pina v. Pina, 290 Ga. 878 (April 24, 2012)

Equitable Division of Non-Divisible Pensions

Equitable Division of Non-Divisible Pensions.  The Court has many ways to divide assets including non-divisible pension.  The court will take into consideration all assets including those assets that may include a non-divisible pension.  If the only significant asset of the parties, in a divorce action, is an assets such as a Teachers Retirement System of Georgia pension for which can not be “attached, subjected to process or assigned”, the court will still be able to divide the asset. For example, the court may equitably divide the nondivisible pension in the form of awarding alimony based on the time rule formula, which determines the marital interest in a pension by dividing the number of marital years that the employee spouse earned toward the pension by the number of years of total service toward the pension.

For example, the Court may award a party alimony in a per month bases once the pension matures.

For more information about this particular subject, see Hammond v. Hammond, 290 Ga. 518 (February 6, 2012)

If you have questions about the equitable division of non-divisible pensions or if you considering filing a divorce, please contact the Remboldt Law Firm, LLC at 404-348-4081 for a free phone consultation.

Settlement Agreement And Beneficiary Designation

Settlement Agreement And Beneficiary Designation.  Here’s an example where Husband and Wife entered into a settlement agreement which was incorporated into their final judgment. The agreement provided in pertinent part:

Each Party expressly waives all of his or her right, title, and interest in and to any pension, profit sharing, or employee benefits plans of the other Party. This provision expressly includes 401(k)s, retirement plans, pension plans, and profit sharing plans. This provision shall not prohibit a Party from voluntarily providing benefits from his or her plan to the other Party at any subsequent date.  Pension, profit sharing, and employee benefit plans are defined to exclude any and all Social Security or other governmental benefits the Parties may be entitled to by virtue of marriage.

Five days after the divorce, Wife committed suicide, and died intestate and had not changed the beneficiary designation on her employer benefit plan. The Supreme Court held that the settlement agreement provisions unambiguously expressed the intent of the parties that the beneficiary spouse is releasing any and all interest in the benefits at the time of divorce, and as such the agreement operated as a complete waiver of the Husband’s beneficiary designation. The Supreme Court further noted that the opportunity to make the beneficiary change was severely limited, and speculation of motivation for the failure to act cannot and should not substitute for the settlement agreement which was concrete action on the part of the Wife.

 Settlement Agreement And Beneficiary Designation.  DeRyke v. Teets, 288 Ga. 160 (2010)

ERISA Funds Not Judgement Proof

ERISA Funds Not Judgement Proof.   Once funds from ERISA-covered plans are received by the proper participant or beneficiary, the participant ofbeneficiary is not judgment proof and the funds are not shelteredfrom state law causes of action Husband and Wife entered into a Separate Maintenance Agreement (“Agreement”) that was incorporated into Court Order. Agreement stated in pertinent part that Wife waived any and all rights to any claim or interest in Husband’s retirement pay, benefit or privileges, and also waived any right to life insurance policies.

Subsequently, a year later, Husband died, and pursuant to the terms of Husband’s employer’s 401(k) plan the plan administrator paid the benefits to Wife, the “surviving spouse.” Additionally, the life insurance proceeds were paid to Wife who remained the beneficiary of the policy at the time of Husband’s death.s Husband’s children brought state claim for breach of contract against Wife based on terms of Agreement. Trial Court dismissed claim based on Wife’s argument that ERISA barred the state claim, stating that the “breach of contract claim was precluded because the waiver executed in the settlement agreement was not ERISA compliant.” Court of Appeals reversed the Trial Court and the Supreme Court affirmed the Court of Appeals finding that Husband’s children could maintain the state court claim, based on contended waiver by Wife, to recover proceeds distributed to Wife as the beneficiary of the ERISA governed plan. In holding same, the Supreme Court differentiated between an estate that could not maintain a state law claim against the employer and plan administrator; and, as is in the case at bar, contended beneficiaries properly maintaining a state law claim against a proper beneficiary who received ERISA covered plan funds based on breach of an Agreement waiving rights to said funds.

“Georgia’s appellate courts have determined that ERISA-covered benefits that have been paid to the participant or beneficiary are not subject to ERISA’s anti alienation provision …once funds from ERISA-covered plans are received by the proper participant or beneficiary, the participant of beneficiary is not judgment proof and the funds are not sheltered from state law causes of action.

ERISA Funds Not Judgement Proof.  Appleton v. Alcorn et al291 Ga. 107 (May 29, 2012)

Trial Court Improperly Modified Decree In Contempt

Trial Court Improperly Modified Decree In Contempt where monetary penalty converted into lien and time for sale of marital residence extended Due to “Market Conditions”.  In the original decree of divorce between the parties, the trial court stated that, in addition to the ex-husband’s obligation to refinance or sell the marital residence so as to remove his ex-wife’s name from it, he would, as an additional remedy, have to pay her a penalty of $10,000.00 if he did not remove her from the house loan by October 1, 2009. The ex-husband failed to sell the house, and he did not pay his ex-wife the $10,000.00 penalty.

During a contempt proceeding brought by the ex-wife, the trial court took two actions, both of which were appealed to the Georgia Supreme Court: 1) rather than requiring the ex-husband to pay the $10,000.00 penalty immediately, the trial court permitted that obligation to be converted into a lien against the marital residence (one that, presumably, would only be satisfied upon sale); and 2) rather than requiring the ex-husband to sell the home immediately, the trial court gave the ex-husband a “reasonable period of time” to sell it instead, “given the market conditions right now.”

The Georgia Supreme Court held that both actions were so contrary to the intent of the original decree as to constitute improper modifications of its terms. The moral of the story: even if a trial court, understandably, wants to act as a problem solver, it is without the power to do so in the context of a contempt action, and must hold the parties to the original terms of the final judgment of divorce

Trial Court Improperly Modified Decree In Contempt.  Greenwood v. Greenwood, 289 Ga. 163 (2011)

Trial Court Impermissibly Modified Decree in Contempt

scalesTrial Court Impermissibly Modified Decree in Contempt when it ordered a Party to sell an asset in order to purge himself of contempt. 

Here are the facts of the case.  The trial court impermissibly modified a final decree in the context of a contempt action when it required an ex-husband to sell a lake house after failing to “buyout” his ex-wife’s interest in that lake house through a series of three payments.

In their opinion, the appellate court took pains to emphasize that the trial court COULD order the husband to pay “a significant sum every day, or even incarcerate him,” until the payments had been made and it recognized that, as a practical matter, the ex-husband might have to sell the lake house so as to satisfy the contempt, but the trial court COULD NOT act as a “problem-solver” by creating a remedy for the contempt in a manner that modified the original decree. Under the original decree, the ex-husband had been awarded the lake house.

Trial Court Impermissibly Modified Decree in Contempt.  Doane v. LeCornu, 289 Ga. 379 (2011).

If you have questions about a divorce settlement agreement, or a contempt matter or if you considering filing a divorce, please contact the Remboldt Law Firm, LLC at 404-348-4081 for a free phone consultation.

Permissible Modification Within A Contempt Action

cropped-Books2.jpgPermissible Modification Within A Contempt Action.  Here’s an example.  The parties created a sole proprietorship within their two year marriage. The banking number and medicare number were in the Wife’s name, and the Husband handled day-to-day operations. The Husband was awarded the business in the divorce. In the amended settlement agreement, the Wife agreed to maintain the banking and medicare numbers in her name until July 3, 2008.  On June 25, 2009, Wife notified Husband that she intended to close the bank account. The Husband stated that the accounts needed to stay open until September 2009. On July 13, 2009, Wife closed the account and forwarded the $4,197.33 account balance to Husband.

The trial court found Wife in willful contempt for closing the bank account, ordered her incarcerated and awarded Husband $52,035.60 in damages and $33,195.55 in attorneys fees, and provided that Wife could purge herself of contempt by paying all amounts due within 60 days of the order.

For more information about Permissible Modification Within A Contempt Action, see Georgia case:  Schererv. Testino, 291 Ga. 75 (May 7, 2012).

If you have questions about a divorce settlement agreement, contempt action, or if you considering filing a divorce, please contact the Remboldt Law Firm, LLC at 404-348-4081 for a free phone consultation.

Can separate property of one spouse convert into marital property?

Division of PropertyCan separate property of one spouse convert into marital property?  The answer is YES!  Here’s an example, A Husband inherited real property in Florida, two Morgan Stanley accounts and two deeded interests in apartment complexes.  Husband’s actions converted property from separate to marital.  Here’s how,

Morgan Stanley Accounts:  Husband opened accounts at Morgan Stanley for sole purpose of transferring inherited funds.  Husband opened the accounts in joint names of Husband and Wife from outset as joint tenants with right of survivorship.  Court found from outset both parties owned an undivided on-half interest, so the accounts are marital in character.  Despite Wife never contributing to the accounts, Lerch applies.  Contribution or not does not “vitiate the evidence that the accounts were transformed into marital property when Husband gave Wife an ownership interest in the property.”

Florida Property:  Husband had property deeded as tenants in common with Wife upon inheritance, changing the charatcter, giving each an undivided half interest.

Apartment Complex:  The parties purchased the property by Wife, Husband and Husband’s brother in equal shares.  The purchased was made during the marriage with marital funds and therefore subject to equitable division.

Can separate property of one spouse convert into marital property?  For more information see the Georgia Supreme Court case of:  Shaw v. Shaw, 290 Ga. 354 (2012).

If you have questions about a divorce settlement agreement, contempt, or if you considering filing a divorce, please contact the Remboldt Law Firm, LLC at 404-348-4081 for a free phone consultation.