One of the most challenging aspects of a divorce is the property settlement. While the law favors an equal division of assets and debt, the specifics pose several challenges. In San Diego Superior Court, there are instances where a Judge will not order that an asset acquired from date of marriage to date of separation. The can include gifts or inheritances. There are instances, however, when this can be changed such as in a written transmutation or commingling of accounts. A San Diego forensic CPA may be needed for a tracing. It is essential that you have the correct and accurate values since this is mandatory for an effective property settlement.
Effectively negotiating a property settlement requires full disclosure, accurate information, clear priorities, and sometimes a third party to eliminate emotion-driven complications. For division of assets and debts, the only issue should be financial. The San Diego Judges use the Kelly Blue Book median value for bank accounts and personal property may be valued well below what it was purchased for. If you owned property before the marriage, this may still be your separate property.
Liquid assets such as bank accounts are easily divided as their value is a matter of record. However, there may be serious questions as to the actual value of other assets, such as real estate or collectibles. Besides cash value, some items of property may have sentimental value to one party. In an acrimonious divorce, it’s not unusual for a vindictive spouse to demand the other party’s “treasures” for no apparent reason. It may be important to seek current professional appraisals in order to determine a range of value for the initial division of assets. It is also vitally important to try and look at this as a business transaction only.
Hidden assets may be another issue that arises in negotiating a property settlement. Be aware of your spouse’s purchases of items such as jewelry, furs, antiques, and collectibles as well as investments. You will both be required to provide full financial disclosure to the Court, and hidden assets can have serious legal consequences. The lottery case of several years ago shows that a Judge had discretion to unequally divide an asset if it is purposefully omitted from the mandatory disclosures to hide the asset from division.
Once the total value of assets is known, each party can begin to apportion property accordingly. You may not receive every item you want. It’s important to let your attorney know your preferences and priorities and be willing to compromise on some items in order to reach a fair settlement in a reasonable time period. The most important is to have a division which is agreed upon as much as possible since a Judge may make an order you do not like.
Besides assets and property, debts are also divided equally between the divorcing spouses. Once the divorce has been finalized, each party will be responsible for the debts assigned to them. It is important to make sure all debts are disclosed, including personal inter-family debts, so they can be included in the property settlement. This does not mean that all debts are divided equally and one example are student loans. Be especially careful with the treatment of joint debts, as the creditor will continue to hold you both legally responsible for the debt, even if it was assigned to one spouse in the property settlement. If you have concerns about your spouse’s willingness or ability to meet financial obligations be very careful as it may affect the terms of your settlement agreement.
The most effective tool in negotiating a fair property settlement may be a qualified attorney on your side. Your lawyer isn’t emotionally invested in Aunt Grace’s quilt or Grandpa’s antique gun collection. He can impartially look at appraised values and negotiate accordingly. Your attorney can recognize unreasonable demands and help you have reasonable expectations about the outcome of your settlement. He can advise you when it’s time to stand your ground and when it’s time to back down or compromise.
To learn more about property settlements or other divorce issues, call our office at 858-312-8500 or contact us online to set up a free initial consultation.