After children and support, the division of the marital estate is the most important consideration in every divorce case. Experienced lawyers will help you maximize or minimize (as the case may be) what is marital property and what is separate property. Generally, only marital property is divided in divorce.
What is the marital estate?
In a divorce proceeding, the marital estate consists of marital property and not separate property. Michigan statutory law § 552.19 provides:
Upon the annulment of a marriage, a divorce from the bonds of matrimony or a judgment of separate maintenance, the court may make a further judgment for restoring to either party the whole, or such parts as it shall deem just and reasonable, of the real and personal estate that shall have come to either party by reason of the marriage, or for awarding to either party the value thereof, to be paid by either party in money.
emphasis added.
At first glance, marital property is property that came to a party “by reason of the marriage”, however, court’s have limited this broad definition as the following cases provide:
In Wilson v. Wilson the Court determined that an ‘external public manifestation’ of the intent to divorce (e.g. separation) could be sufficient to create a separate estate. Simply put, under Wilson the marital estate may not include property acquired after separation.
In Dart vs. Dart the Court upheld the notion that property received by a married party as an inheritance, but kept separate from marital property, is deemed to be separate property not subject to distribution.
In Reeves vs. Reeves Property that is wholly passive and did not appreciated because of the efforts of a party is separate property and not part of the marital estate.
Dividing the marital estate.
Generally, the marital estate is divided between the parties, and each party takes away from the marriage that party’s own separate estate with no invasion by the other party. However, a spouse’s separate estate can be opened for redistribution when one of two statutorily created exceptions (MCL 552.23) are met. First, when the estate is insufficient for the support of the other party (e.g. there is only separate property) and second, when the other party “contributed to the acquisition, improvement, or accumulation of the property.” (MCL 552.401) For example, if one party made the downpayment on a home before marriage and the property is in the other parties name the property could be considered part of the marital estate.
Case law provides us with more direction with how the marital estate is divided.
Ackerman v. Ackerman: The goal of the court when apportioning a marital estate is to reach an equitable (fair) division in light of all the circumstances.
Knowles v. Knowles: Each spouse need not receive a mathematically equal share, but significant departures from congruence must be explained clearly by the court.
Sparks v. Sparks: When dividing the estate, the court should consider:
(1) duration of the marriage;
(2) contributions of the parties to the marital estate;
(3) age of the parties;
(4) health of the parties;
(5) life status of the parties;
(6) necessities and circumstances of the parties;
(7) earning abilities of the parties;
(8) past relations and conduct of the parties; and
(9) general principles of equity.
“The significance of each of these [Spark] factors will vary from case to case, and each factor need not be given equal weight where the circumstances dictate otherwise.” In most cases, “equity” or fairness plays an important role and a 50/50 division is often (but not always) appropriate under the circumstances.
By: Daniel Findling (2023)
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