Tag: divorce equitable distribution

Transforming Nonmarital Property Into Marital Property

For many clients going through divorce, there is a concern that their nonmarital property can transform into marital property, and then get distributed by a court. Believe it or not, divorce lawyers know that in certain cases, it is easy for your nonmarital asset to be transformed into a marital one. One couple in north Florida found out how courts look at whether your nonmarital property has been transformed into a marital property during a divorce.

marital property

Defining Marital and Nonmarital Property

Understanding a little about Florida’s equitable distribution statute will help you protect your premarital assets from being wrongly divided. In Florida marital assets and liabilities include assets acquired and liabilities incurred during the marriage, individually by either spouse or jointly by them.

Many people forget that marital assets also include the enhancement in value and appreciation of nonmarital assets resulting either from the efforts of either party during the marriage or from the contribution to or expenditure thereon of marital funds or other forms of marital assets, or both.

Another area of transforming nonmarital assets into marital one is by gifts. Under Florida law, marital assets include gifts between spouses during the marriage.

Conversely, nonmarital assets and liabilities include things like assets acquired and liabilities incurred before the marriage, and assets acquired separately by either party by non-interspousal gift, bequest, devise, or descent. For example, an inheritance may initially be considered nonmarital property absent anything else.

Before a court will classify your assets as either marital or nonmarital, the court will consider numerous factors. One of the factors a court will look at is the title of the property. A court will also consider whether you commingled your marital funds with your nonmarital funds. Were there any increases in the value of your nonmarital stock accounts because of marital efforts, or control of the funds? If so, a court may consider that too. They will also look at the length of the marriage, and your intent concerning the marital or nonmarital status.

Transforming Marital Property

In a recent case in Florida’s panhandle, a husband and wife divorced. During the trial, the family judge added to the equitable distribution schedule one of the husband’s Certificate of Deposit accounts. However, there was no evidence that the CD account, which was acquired ten years before the marriage, had transformed into a marital asset.

On appeal, the appellate court reversed the decision. The appellate court found that there was no evidence at the trial that there was any enhancement of the CD account through the husband’s efforts. The court also noted that there was no evidence that the husband commingled his nonmarital funds with marital funds. Lastly, there was no evidence that he had given to his wife the CD account as a gift.

Gifts between spouses are an important and frequent way in which a nonmarital asset becomes a marital asset. Believe it or not, there are even cases in Florida where spouses accidentally gifted non-marital homes to their spouse by birthday card, not realizing they would be found to have the proper donative intent.

Florida’s New Anti-Gift Law

This year the law changed in Florida. The revised equitable distribution statute now prohibits interspousal gifts of real estate unless there is written documentation that complies with the provisions for conveyance of real property under the statute governing deeds to property.

The mere inference of a gift of real property will now not meet the threshold required for an interspousal gift unless there was written documentation for a conveyance.

The new law in Florida also makes it clear that when a spouse merely signs a deed for the sole purpose of conveying a homestead property – other than the other spouse or both spouses jointly – the deed does not change the character of the real property from nonmarital property to marital property.

Finally, the new amendment to the equitable distribution statute changes the definition of nonmarital assets and liabilities so that real property acquired separately through non-interspousal gift, bequest, devise, or descent and in which legal title has not been transferred to both parties as tenants in the entireties, remains non-marital property.

The appellate decision is here.

Equitable Distribution of Human Organs

If you promise to love someone with all your heart, can you ask a court for an equitable distribution of your donated human organs back? One very upset New York organ donor spouse is asking the court to be made whole again.

equitable distribution organs

Kidney Pains

Richard Batista, a 49-year-old doctor from Ronkonkoma who graduated from Cornell University Medical School in 1995, married Dawnell Batista on August 31 1990. The couple had three children, then ages 14, 11 and 8.

After Dawnell had two failed kidney transplants, her husband donated one of his kidneys to his wife in an operation that took place at the University of Minnesota Medical Centre on June 18 2001. Richard Batista said his marriage at the time was on the rocks because of the strain of his wife’s medical issues.

“My first priority was to save her life. The second bonus was to turn the marriage around.”

Four years later, Dawnell sued her husband for divorce, alleging domestic violence and infidelity.  One week before the divorce trial was scheduled to begin, Richard announced he was seeking a stay of the case until his retained “expert” could give an opinion to the court estimating how much his kidney was worth.

After Dawnell filed for a divorce, Richard wanted the court to either award him his kidney back as part of his settlement demand, or credit him in the equitable distribution the fair market value of his donated kidney – an estimated cool $1.5m.

Florida Equitable Distribution

I have written about equitable distribution in Florida before. In a proceeding for dissolution of marriage, in addition to all other remedies available to a court to do equity between the parties, a court must set apart to each spouse that spouse’s non-marital assets and liabilities.

However, when distributing the marital assets between spouses, a family court must begin with the premise that the distribution should be equal, unless there is a justification for an unequal distribution based on all relevant factors.

In Florida, nonmarital assets include things such as assets acquired before the marriage; assets acquired separately by either party by will or by devise, income from nonmarital assets, and assets acquired separately by either party by non-interspousal gift. Importantly for this doctor’s divorce, will the donation of his pre-marital body part be construed as an interspousal gift?

Kidney Failure

In a 10-page decision, the Nassau County Supreme Court rejected the ex-husband’s request that it should consider his donated kidney as an item of property to be valued in the divorce suit, according to Dawnell Batista’s lawyer.

The court said “marital property” covers a lot of things, but human tissues or organs aren’t any of them. It also said that not only was Richard Batista’s attempt to extort money from his wife for the kidney he donated legally unsound:

“The defendant’s effort to pursue and extract monetary compensation therefore not only runs afoul of the statutory prescription, but conceivably may expose the defendant to criminal prosecution.”

Medical ethicists agreed that the case is a non-starter. Asked how likely it would be for the doctor to either get his kidney back or get money for it, Arthur Caplan at the University of Pennsylvania’s Centre for Bioethics, put it as:

“somewhere between impossible and completely impossible”.

What’s more, no reputable surgeon would perform such a transplant and no court could compel a person to undergo an operation, he said.

The NBC New York article is here.

Equitable Distribution of the Marital Home

My hometown newspaper, The Miami Herald, weighs in on the problems couples face with the equitable distribution of their home during a divorce. The view is from the perspective of real estate agents around the country. In a perfect world, couples sit down together, and figure out the best time and price to sell their house. But of course, divorce is not a perfect world.

selling marital home divorce

Miami Vices

During a divorce, people react differently, sometimes badly, when it comes time to sell their homes. According to many real estate agents, in an attempt at a power play, one spouse simply disappears. And in rare cases, both spouses can vanish before the home is sold.

Divorce is an emotionally charged event, and often one spouse will take a hike when they believe the other one is exerting too much control over the situation. Sometimes, they disappear before an agreement is reached on how to sell the house. But once in a while, a soon-to-be ex takes off after the place is sold but before the deal goes to closing. If they never come back, the transaction can easily fall apart.

But some real estate agents think that it is better to take off and cool off, than act out in an aggressive manner. One real estate agent reported that one of her colleagues was once threatened with a machete. In another instance, emotions were so high that and agent had to sit between warring spouses at a closing.

Florida Equitable Distribution

I’ve written about equitable distribution of the marital home during a divorce before. In a proceeding for dissolution of marriage, in addition to all other remedies available to a court to do equity between the parties, a court must set apart to each spouse that spouse’s non-marital assets and liabilities.

However, when distributing the marital assets between spouses, a family court must begin with the premise that the distribution should be equal, unless there is a justification for an unequal distribution based on all relevant factors.

Generally, the home remains a marital asset, which is subject to equitable distribution, regardless of who lives there during the divorce process. If a home is marital then both parties have equal opportunities to buy the other spouse’s share. Both may also be on the hook for liabilities.

Until a parenting plan for the children is in place, if you are interested in maintaining a meaningful relationship in your child’s life, leaving the home before a timesharing agreement is entered may create problems, and it can be costly, and prohibitive expensive to rent a new place if the process takes a long time.

Staying in the same home could create an incentive to negotiate a final settlement because living with your soon to be ex-spouse is very uncomfortable. However, there are also a multitude of problems with selling the marital home during a divorce, as many real estate agents will tell you.

Love It or List It!

One way agents have dealt with angry spouses is not to allow them to be in the same room together. Some suggest interact with clients separately. Another way is for the couple to hire a skilled team in real estate sales and divorce. But many say that the best way is to sit down together and discuss the situation as calmly as possible.

While the joy of living under one roof may have been lost during a divorce, couples could be living together as housemates until the home is sold – if it is sold at all. Whether the house is sold or not, it’s better to negotiate calmly about who will get what, or how the expenses will be handled. If the home is sold, couples must decide: How to divide the proceeds, and how utilities and other household expenses will be handled.

If addressed early on, before tempers flare, it will go a long way toward making your remaining time together as bearable as possible. Actually, you have to keep your cool until the day after you have sat down at the closing table. You can blow off steam after the closing, but don’t let your pent-up anger scuttle the deal at the closing.

One agent reportedly was working with a client seeking to buy a house from a couple who was in the middle of a divorce. When it came time to close, the wife refused to sign the documents until her soon-to-be ex-husband agreed to pay off a “very large” credit card bill that had nothing to do with the house. He didn’t pay. She refused to sign. The buyers didn’t get the house. A lawsuit could result.

The Miami Herald article is here.

Equitable Distribution of Boudoir Photos in Divorce

How a family court decides the equitable distribution of boudoir photos, complete with intimate inscriptions and nude photographs, is never easy. A Utah family court recently ordered a woman to hand over her most intimate photographs to her ex-husband and a third-party photographer he chose.

Equitable distribution Boudoir

‘Utah: Life Elevated’

A former wife was married for 25 years and together for 27. As expected, the process of splitting their assets would be complex in a long marriage. The issue became so complex, negotiations failed and a one-day bench trial had to be held.

After the trial, the family judge ordered the former wife to surrender her most intimate photographs of herself to a third-party photographer for editing, and then ordered that the edited photos be given to her ex-husband for his viewing pleasure.

“You don’t know where to turn because you don’t know the law and you have not only your ex-husband who you were married to for years (thinking) that forcing you to distribute basically porn is OK … you have his attorney that also thinks that’s OK. And then you bring it in front of a judge, and he thinks it’s OK.”

The family court’s finding of facts dated July 7th — the day the divorce was finalized — found that the nude photos were given as gifts to the former husband earlier in their marriage, and therefore he “has the right to retain them and the memories they provide.”

The court also found the former wife has a right for her intimate photos to not be in her ex-husband’s possession. So how did the family judge decide the steamy issue? The judge ordered her to turn the images over to the original photographer for editing.

That person is then to do whatever it takes to modify the pages of the pictures so that any photographs of the former wife in lingerie or that sort of thing or even without clothing are obscured and taken out, but the (photo inscriptions) are maintained for the memory’s sake.

Florida Equitable Distribution

I have written about equitable distribution in Florida before. In a proceeding for dissolution of marriage, in addition to all other remedies available to a court to do equity between the parties, a court must set apart to each spouse that spouse’s non-marital assets and liabilities.

However, when distributing the marital assets between spouses, a family court must begin with the premise that the distribution should be equal, unless there is a justification for an unequal distribution based on all relevant factors.

In Florida, nonmarital assets which are not divided include things such as assets acquired before the marriage; assets you acquired separately by non-interspousal gift, and assets excluded as marital in a valid written agreement.

Conversely, marital assets which are subject to division, generally include things like assets and liabilities acquired during the marriage, the enhancement in value of some nonmarital assets – and for anyone giving their spouse a gift of sensual boudoir photographs – interspousal gifts during the marriage.

Wisdom of Solomon

Despite the ruling, the original photographer refused to edit the images over a concern about ethics and legal repercussions to her photography business. Being a boudoir photographer, her clients trust her with their images and privacy, and the photographer took that responsibility seriously.

The judge then made a second ruling, and ordered the former wife to give the images to a different photographer for editing. She was also ordered to retain the original photos for 90-days before destroying them, in case her ex-husband wasn’t satisfied with the edits.

The former wife said her ex-husband isn’t happy with the edited photos, though she feels that she has complied with the court’s order, and she feels that her ex-husband’s demand for the photos was an attempt to control and hurt her.

“If all he was truly interested in was the inscriptions, he got those. I’ve complied with the court’s order, even though I believe strongly that (the) order (is) violating on many levels and has affected my emotional and mental health. I can’t imagine doing this to someone else.”

The ex-husband said his former wife’s description of the situation is her perspective. This is not my perspective nor the perspective of an impartial judge. It appears that she has intentionally misrepresented and sensationalized several aspects of a fair proceeding to manipulate the opinions of others for attention and validation of victimhood.

One attorney was quoted as saying equitable distribution in a divorce always involves a balancing of interests but the judge here has just made a mistake in the balancing of interests and has tipped things much too far in one direction.

The Salt Lake Tribune article is here.

Equitable Distribution of Google Stock

Scott Hassan, known by some as the third Google founder, is finally headed to his divorce trial after nearly seven years battling over the equitable distribution of Google stock, real estate, and other technology stock – estimated to be worth billions of dollars.

Equitable Distribution Google

“I’m Feeling Lucky”

As the divorces of Bill Gates and Jeff Bezos show, technology billionaires are trying to divorce quietly, behind closed doors. For example, when Google co-founder, Sergey Brin divorced his ex-wife, he hired a private judge to hash out the details.

A quick Google search shows that Hassan and Huynh’s divorce is anything but quiet. Huynh accuses her husband of engaging in “divorce terrorism,” such as creating a negative website called AllisonHuynh.com.

The site contains documents posted of sexual allegations related to Huynh’s wrongful termination suit against her former employer. They claim that Huynh threatened to “kill [her former employer] and then herself” if he ever left her and “kept track of when [her former employer] was out with a new girlfriend,” according to the cross complaint filed by [her former employer] and his attorney in response to Huynh’s suit.

After being accused of creating it, Hassan admitted to launching the site, seeding it with links to articles written about his ex — and links to court documents from three embarrassing lawsuits that involve her.

When confronted, he purportedly admitted to The Post:

“I did, but I have taken it down. It came together in a moment of frustration, when I felt Allison and her attorney were telling one-sided stories to the press. I thought aggregating publicly available information without commenting or editorializing would help … It only ended up making our dispute more public and tense, which was never what I intended.”

According to sources, in 2018, their estate was valued at $1.8 billion and he wants to give her a minuscule fraction.

Florida Equitable Distribution

I have written about equitable distribution in Florida before. In a proceeding for dissolution of marriage, in addition to all other remedies available to a court to do equity between the parties, a court must set apart to each spouse that spouse’s non-marital assets and liabilities.

However, when distributing the marital assets between spouses, a family court must begin with the premise that the distribution should be equal, unless there is a justification for an unequal distribution based on all relevant factors.

In Florida, nonmarital assets include things such as assets acquired separately by either party by will or by devise, income from nonmarital assets, and assets excluded as marital in a valid written agreement.

Importantly for this hi-tech divorce, non-marital assets would include assets acquired and liabilities incurred by either party before the marriage, and assets acquired and liabilities incurred in exchange for such assets and liabilities.

“I’m Feeling Wonderful”

Mr. Hassan was a research assistant at Stanford’s computer science department when he met Larry Page, then a Ph.D. candidate. When Larry and Sergey Brin founded Google in 1998, Hassan bought 160,000 shares for $800. In 2004, the shares were worth more than $200 million. The shares, now in Google’s parent company, Alphabet, would be valued at more than $13 billion today.

In 2001 they married in Las Vegas and there was no prenuptial agreement, and they barely discussed finances. Ms. Huynh says she supported the family financially in the early years but her husband denies that.

In 2006, during the marriage, the husband formed a limited liability company called Greenheart Investments. Greenheart was valued at more than $1 billion in 2015.

Huynh wants Greenheart to be considered community property because Hassan repeatedly muddied the line between his separate assets and their community property. But Hassan argues that the company should be considered his separate property because it was started with his pre-marital assets.

Hassan acknowledged during court proceedings that he had set up Greenheart as his own company to keep certain assets ‘completely separate’ from Allison.” She insists it is community property — which partners must, typically, divide equally under California law.

Hassan maintains “that the disputed assets are properly characterized as my separate property — this does not necessarily mean that the community, or Allison, will not be compensated,” Hassan said. “I already agreed to provide her with a significant amount of money every month.”

But Huynh purportedly told The New York Post:

“His miserly position is ludicrous. I pray that a Big Tech billionaire will not get away with his attempt to cheat his children and me while he walks away with everything.”

The New York Times article is here.