Division of Property and Assets after Divorce

Alabama is an “equitable distribution” state. This means that the division of property, assets, and debts should be fair and equitable. However, this does not necessarily mean that they are equal. There is no fixed standard to decide property, meaning that each case is decided separately based on its facts. The court may divide jointly owned property, award property to one spouse that was previously owned by the other spouse, and even order for property to be sold in order to achieve the aforementioned “equitable distribution.” Courts can award a divorced wife slightly under half of the husband’s estate or almost all of the marital estate, depending on the circumstances of the case.

Property that was acquired before the marriage may be excluded from the marital estate. This is the case if the property was never used for the common benefit of the couple during their marriage. The same principle applies for property that was gifted to or inherited by a single party during the marriage, that the other party derived no benefit from as a result of the marriage. To demonstrate an example: if a wife owned a property before marriage, and after marriage she continues to hold exclusive control over that property, excluding her husband from any role or benefits derived from the property, then that property can be considered her separate estate.

Shorter marriages tend to make for easier property and asset division after a divorce. This is because the couple did not have as much time to accumulate as many joint assets. Cases concerning short marriages usually just try to bring each party back to the financial position they were at before the marriage. The more that a couple “co-mingles” their assets, the more difficult this process becomes, even in shorter marriages.

In Alabama, a property settlement is not subject to modification because of a change of circumstances. Without a showing of clear abuse, the decision of a trial court will not be disturbed on appeal. Property settlements become final after 30 days. One of the most common pieces of property that must be considered in court is the divorcing couple’s marital home. Deciding what course of action constitutes equitable distribution with regards to the marital home often leads courts to get creative. The divorced wife is sometimes granted “use and possession” of the home for a specified time, or for life. They can also grant her possession of the home until she remarries, or all of the children reach the age of majority (19 in Alabama).

Those interested in divorce law may also want to research “Hurdle Minor”, which addresses the tax principles accompanying most divorce cases. This principle becomes particularly important when one party has a higher income than the other, or the couple owned a property that has increased in value.