I had a pre-trial scheduling conference yesterday for an ED case. I am the defendant and my husband is trying to recover all his separate funds invested into our marital property. The property was purchased and title was conveyed into both our names on the same day escrow closed, which I understand makes the property a “gift to the marriage”. (Or a presumption of a gift to the marriage).
90 days have been given for “discovery”…during which time my husband is supposed to get an appraisal on the house.
Should I be preparing something for discovery as well? What questions should I be asking to see what proof my husband can provide that the marital home was not a gift to the marriage?
I guess I need to know where should I go from here?
Yes, that is typical of a scheduling conference. I am sorry you drove all of the long way there to attend that. Normally, it is just the two attorneys who attend these, but if you are pro se then you should be there. I don’t know what list you’re talking about. As far as proving income, you can request his bank statements (if he has any), tax returns and any pay stubs he may have for the services he provides.
Not a problem. I have answered a similar question in a post just a few moments ago. No matter where the money is from, if you take money and place it in real estate, like your house, and it is jointly titled, the court will “presume” that you “gifted” the funds to the marriage by putting them in a house that is jointly titled. This is a hard presumption to overcome. Your husband will have difficulty getting past this if he put you on the deed right away after escrow.
Therefore, if you jointly title the house it is considered a gift to the marriage. However, the fact that he purchased it with his separate property may be a justification for an unequal distribution. However, if you have reduced the principal on the mortgage during the marriage, then the reduction in the principal on the mortgage would be marital property. You would also be entitled to any increase in value that was caused because of your active efforts, such as installing new floors, upgrades etc. Increases in value that occur simply because of market forces are not marital property.
I would recommend you schedule at least a consultation with an attorney to give you a plan of action moving forward into the discovery process. You have on your side the fact that he is the one that has to overcome the presumption that it’s a gift to marriage. Good luck.
What about the situation where the marital residence decreases in value since dos due to market conditions but one spouse must maintain the house at huge expense (plumbing, electrical, HVAC, roof, etc.)?
By saying that his purchasing it with “separate funds” is justification for un-equal distribution is the same thing as calling it separate property, isn’t it?
It either becomes a “gift to the marriage” which should imply equal ownership or what’s the point?
Daisy: Yes, that would be considered. Again, that would be grounds for a possible unequal distribution of marital property if one spouse has had considerable expense in keeping the property up since DOS (as long as ED hasn’t been settled via an agreement). Debt is divisible in the same way as assets. In other words, more debt could be assigned to the other spouse since the resident spouse has spent funds on repairs.
PlayFair: The presumption is this scenario that the separate funds have now been gifted to the marriage, and the property should therefore be split 50/50 for the portion of the value that accrued during marriage. The presumption is rebuttable, to allow for an unequal distibution instead, but the party would have an uphill battle in showing that by putting their spouse on the property, they were not gifting the property to the marriage. This is difficult to do.
Daisy: Yes, that would be considered. Again, that would be grounds for a possible unequal distribution of marital property if one spouse has had considerable expense in keeping the property up since DOS (as long as ED hasn’t been settled via an agreement). Debt is divisible in the same way as assets. In other words, more debt could be assigned to the other spouse since the resident spouse has spent funds on repairs.
PlayFair: The presumption is this scenario that the separate funds have now been gifted to the marriage, and the property should therefore be split 50/50 for the portion of the value that accrued during marriage. The presumption is rebuttable, to allow for an unequal distibution instead, but the party would have an uphill battle in showing that by putting their spouse on the property, they were not gifting the property to the marriage. This is difficult to do.
Please allow me to further clarify. For illustration…if $155,000 of his separate funds went into the house, with a $80,000 loan procured, with escrow closing 2 weeks after the date of marriage, and conveyance of the deed into first his name, then on the same day into both names, including the word “wife” in the description, and the house is appraised showing equity of only $100,000 now (after the loan is paid off, due to market changes, and his devaluing of the property by uncompleted remodeling projects), that equity would be split 50/50?
If that is true, what can his argument be to receive the entirety of equity of the sale of the house? According to his attorney, he would be claiming a loss of $55,000 from his separate funds, and is willing to absorb the loss with my agreement to convey the house to him with no consideration.
This just does not seem fair to me at all.
And the courts won’t take into consideration why I had to leave the home? The mortgage payments and property taxes are less than what I had to pay to rent a home for myself and my children.
I just ask because I think I have a case to receive equal distribution, but I want to be sure I’m not wasting my time fighting this.
It is most likely from your facts presented that you would receive a 50/50, equal distribution since this appears to be a gift to marriage. He is trying to avoid this because if there is $100,000 in equity, he doesn’t want to have to give you $50,000. If your house was underwater or had little equity, then it would be perhaps a good idea to let him keep the house in his sole name. I suggest you consult with an attorney to protect your rights.
