In New Jersey, the process by which marital property is divided between spouses upon divorce (or dissolution of a civil union) is known as “equitable distribution.”
The first step in the equitable distribution process is to determine what property the couple owns and what property is subject to equitable distribution.For example, property that was acquired before the marriage that a spouse has kept in his or her name is normally considered separate property and exempt from equitable distribution.
Property that was acquired during the marriage, including retirement benefits that accrued during the marriage, are normally considered joint property and are subject to equitable distribution.
The next step is to determine how much the joint property is worth.The determination of value may be by agreement, by use of appraisals or other means.
The final step is the actual distribution of the property based on the factors listed below. A judge may also consider “any other factors which the court may deem relevant.”
The word “equitable” means “fair.”However, it does not mean that property will necessarily be divided equally (50/50) between the spouses.
“Fault” is generally not relevant in making equitable distribution of property.New Jersey courts will not, for example, punish a spouse who committed adultery by awarding him or her less property during the equitable distribution process than he or she would otherwise be entitled to.
However, a judge may consider other kinds of fault.For example, if one spouse dissipated (wasted) the couple’s property.One New Jersey Supreme Court case defined dissipation of marital property as:
…where a spouse uses marital property for his or her own benefit and for a purpose unrelated to the marriage at a time when the marital relationship was in serious jeopardy.
Some examples of dissipation of marital assets include spending the family’s money on presents for a lover or the expenses of an affair (hotel rooms, etc.), on gambling, or on drugs or alcohol.
The dissipation of marital assets by one spouse may cause the court to reduce that spouse’s share of the marital assets upon divorce.
The factors considered during equitable distribution of marital property in New Jersey are:
- The length of the marriage;
- Each party’s age and physical and emotional health;
- The amount of income or property that each spouse brought into the marriage;
- The couple’s standard of living during the marriage;
- Any written agreement between the parties made before the marriage, (i.e., a premarital agreement ) or made during the marriage and dealing with property distribution;
- The economic situation of each spouse when the property division occurs;
- Each party’s income and earning capacity;
- The need for a non-self-supporting party to gain education or training and achieve a standard of living reasonably comparable to what the couple had during the marriage;
- Each party’s contribution to the education, training, or earning power of the other, such as supporting one spouse through college or professional training;
- How much each spouse increased or decreased the value of the marital property;
- A party’s contributions as a homemaker and caregiver for the couple’s children;
- The tax results of a proposed equitable distribution or property;
- The overall value of the couple’s marital property;
- Whether a parent with physical custody of the couple’s children needs to own or live in the family home;
- The parties’ debts and liabilities;
- The necessity for a trust fund to pay for the medical or educational needs of a spouse or child;and
- The extent to which one spouse put off or gave up his or her own career goals due to marriage and raising children.
Each of these factors is important.Many judges will consider the length of the marriage and the couple’s lifestyle to be among the most important issues.
If you have questions about property division in a New Jersey divorce case, please contact our office to arrange an appointment with an experienced Bergen County family law attorney at Chase & Chase.