When a couple dissolves their relationship, the division of property can be one of the most important and complicated issues. The division of property will include both assets, (such as real estate, personal belongings, automobiles, stocks, bank accounts, pensions), as well as debts. In addition to the general rules of property division, a competent lawyer will also take into considerations the tax consequences and present/future value of an asset or liability to benefit his/her client.
What property is divided?
Courts distinguish between marital property and separate property.
- Separate property is typically property acquired before the parties married.
- Marital property is typically property acquired during the marriage.
Michigan has adopted a doctrine called the doctrine of non-invasion of separate property. As a general rule, separate property (before marriage) is awarded to the party who owned the property prior to marriage, unless the other party substantially contributed to its acquisition or appreciation or the estate is otherwise insufficient. (For example, if you purchased your home before marriage, the increase in value of the property during the marriage will often be considered marital.)
Defining specific property as marital, separate or both can have a significant impact on a property award. Michigan law provides many exceptions to these general rules.
How is the property divided?
Michigan law promotes an equitable distribution of property. There is no requirement that property awarded to each party be equal, but at a minimum should be fair.
In determining the distribution of property, the courts take the following into consideration:
- The source of the property;
- Who contributed toward the acquisition of the property;
- The length of the marriage;
- The needs of the children, if any;
- The earning powers of the parties;
- Who is “at-fault” or “caused” the Divorce.