As a general proposition, only property acquired by reason of the marriage (and during the course of the marriage) is divided in a divorce. However, there are circumstances when property received after divorce is also divided.
For example, your spouse may have a bonus that was earned during the marriage but paid after the parties divorce. The bonus would still be marital property and subject to division.
However, a retention bonus paid by an employer is not marital property even if paid during the marriage if it is subject to repayment or conditioned upon employment after divorce. In the seminal case of Skelly vs. Skelly, 286 Mich.App. 578 (2009), the Court of Appeals ruled that a wife was not entitled to a percentage share of her ex-husband’s future employement bonuses because the bonuses:
“were not earned during the marriage and are based solely on the potential occurance of future events unrealted to the marrriage.”
The details are as follows, during the parties divorce, the husband entered a new employment contract containing a contingent bonus package paid in advance, but conditioned on continued employment. If for example, the employee left the company, he would have to repay the bonus.
The court reasoned that the retention bonus was not earned during the marriage and therefore not marital property.
Court’s also distinguish between vested and unvested stock options. For example, if a stock option is unvested, it is not yet earned, however, options vested during the marriage are in fact marital property and therefore divisible in the marital estate.
In sum, it is key to determine if property received after divorce was earned during the marriage in deciding if it is marital property or separate property.
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