Resolving Property Division

patrickcrawford | February 21, 2022

About 95 percent of divorces settle out of court. If you find yourself heading towards that five percent who must litigate property division issues, it can be stressful. Below, we’ll discuss everything you need to know about marital asset division during divorce, particularly with high net worth divorces, since they are least likely to settle. Make sure you have an Annapolis divorce lawyer handling your case. 

Asset Division Considerations in Divorce 

This is an overview of things to consider and discuss with your asset division attorney: 

1. How dividing different assets can impact your tax burden 
2. Handling personal inheritances 
3. Ease of liquidation of certain assets 
4. Division of debts 
5. Retirement accounts 
6. If any quitclaim deeds will be needed
7. Property acquired while living apart but not yet divorced  

Alimony

Alimony (also known as spousal maintenance) is another factor that you want to try to agree on, rather than letting a judge decide. If the court decides, these are the factors that will be evaluated:  

1. Each spouse’s age and health
2. The standard of living during the marriage 
3. Each spouse’s work history and level of education/training  
4. How long the marriage lasted 

Maryland Is Not a Community Property State

Community property states divide marital assets 50/50. Maryland, however, is an “equitable division” state, meaning assets are split based on what is equitable, not what is 50/50. What this means as far as your individual assets is that it’s time to start gathering documents supporting your ownership, receipts for payments you made, and so on.

Property division requires a lot of documentation. High net worth divorces in Maryland can be especially complex because a judge has to determine what is “fair” in dividing a lot more assets. This leaves room to interpret what is fair.  

No-Fault Divorce in Maryland

Being able to agree on a “no-fault” divorce is an important start to being able to agree on other aspects of the divorce. Additionally, a no-fault divorce generally reflects better on asset division.

If one spouse is shown to be at fault (adultery, cruelty, abandonment, incarceration, etc.), that can sometimes translate into being awarded fewer assets. There are two ways to get a no-fault divorce in Maryland:

1. Mutual consent by both spouses on 100 percent of the issues (child custody, asset division, alimony, and child support)
2. The couple must live separately for one continuous year without having any sexual intimacy 

Hiding Assets

Hiding assets is fraud, which is illegal and carries a hefty penalty. Furthermore, concealing the true and complete nature of your finances can negatively impact your child custody and support order. To be clear, hiding assets is a bad idea. 

If you think your spouse might be concealing assets, let us know. We can examine your options to uphold your property division rights.  

Joint Bank Accounts

Sometimes one spouse will empty a joint bank account and move the money to an individual bank account. Let us know if your spouse does this, and we can properly address the matter with the court. Further, you should avoid doing this to avoid unnecessary complications with your property division. 

High Asset Divorces

High net worth divorces tend to be the ones that are unable to settle out of court, as mentioned above. Here are a few nuances to consider about divorces with over one million dollars in assets: 

1. Usually, a number of experts must be hired to evaluate the true value of the assets (appraisers, business consultants, other lawyers) 
2. They generally take longer to finalize, meaning more legal fees 
3. The spouses involved usually don’t have simple, straightforward spending habits. Often lawyers advise high net worth individuals to live frugally during divorce since the court can evaluate their financials at any time. This can be a nuisance for a year or longer.

Is a Postnuptial Agreement an Option?

Since only about 5 percent of couples have prenups, you might consider whether creating a postnuptial agreement is possible.

A postnuptial agreement is like a prenup, except that it is created during marriage and before filing for divorce. So, if your divorce has not yet been filed or your spouse doesn’t know you want to divorce, this is an option.

To be valid, the postnuptial agreement must include non-technical, accessible language around any rights being waived and:

1. Be in writing and signed together by the couple
2. Not violate state or federal law or include “unconscionable” clauses (like discouraging one spouse from notifying the authorities of the other spouse’s abusive or threatening behavior)
3. Waive at least one marital right (such as the right to alimony) 
4. Cannot pre-arrange child support or child custody 
5. Be entered into voluntarily and willingly
6. Include complete and accurate financial disclosures by both parties

Alternative Dispute Resolution 

There are out-of-court options to help you and your spouse settle your property division. These methods are known as “alternative dispute resolution” (ADR). ADR includes mediation and arbitration:  

1. Mediation is structured like court, but it is less formal. It is an interactive process where a “mediator” (a combination of a coach and a judge) assists you and your spouse in agreeing to an equitable settlement. A mediator is trained in negotiation and communication to help facilitate the process.
2. Arbitration is like mediation except that the arbiter (like the mediator above) will make a decision about how the assets should be divided if the couple cannot agree. This process is also called “binding arbitration” because the decision of the arbitrator is enforceable by law. Oftentimes if a couple can not reach an agreement through mediation, they will then try arbitration. 

Both methods of ADR tend to be cheaper, faster, and easier than litigating in court. You do not need to be represented by a lawyer to use either method of ADR. Some mediators will actually not let attorneys attend mediation sessions.

It is still highly advisable to consult with an attorney so you have a clear understanding of your rights and responsibilities, have a strategy, and so on.

How to Interview a Marital Asset Division Lawyer  

When you are reaching out to different divorce lawyers, remember that not every lawyer—or even every divorce lawyer—specializes in asset division or high net worth cases. Furthermore, remember you are interviewing the lawyer for the job of representing you in this matter. Here are a few questions to ask during your initial meeting:  

1. Do you know my ex and/or the attorney representing my ex?  
2. Is your approach more collaborative/negotiating or more fighting/aggressive?  
3. Who is on your legal team? Will I be interacting with your partner, process server, secretary, notary, file clerk, courier, or paralegal? Who does what?
4. Can I see a copy of your contract? Will I pay a retainer? Do you offer a flat fee? What is your hourly rate?
5. How many property division cases or high net worth divorces have you handled? How many went to trial? 

Call an Annapolis Family Law Attorney

The Law Office of Patrick Crawford practices family law and has all the experience you need to assist in resolving a sticky property division situation. There is a lot on the line, and you don’t want to jeopardize your future finances. Contact us today to set up a free consultation. Call: 410-787-6546