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What is equitable distribution and how does it affect a divorce?

On Behalf of | Nov 24, 2021 | Property Division |

Property division can be one of the more complex issues a couple will have to deal with during their divorce. This is particularly true when their assets are higher in value and more diverse. Understanding how the court goes about the process of dividing property can help to ease tensions and plan ahead.

Marital versus separate property

With respect to assets, the first step a court will take is to divide them into one of two categories – marital property and separate property. Separate property is an asset which is wholly owned by one spouse. Typically, this takes the form of something the spouse owned prior to the marriage or a gift or inheritance acquired during the marriage. As a general principal, separate property will remain with the spouse who owns it. Everything that is not separate property will be classified as marital property.

Equitable distribution

Michigan is not a community property state. Instead, Michigan law follows the principle of equitable distribution. The idea is that the court will seek to distribute marital property between the spouses equitably (or fairly), rather than equally. This approach can have the effect of dividing property in seemingly unusual ways.

Take the family home, for example. In some circumstances equity may demand that the home be sold and the proceeds divided between the spouses. But if the couple has children, who are still living in the home, equity may demand awarding the house to one spouse, so as not to disrupt the children’s lives more than necessary. And this brings up another point about equitable distribution – the court can consider most any factor, and take most any action, necessary to achieve a fair distribution of property. This can even include awarding some separate property to the spouse who does not own it, if the situation requires it.

Dealing with the complexities of property division

Because of the complexities involved in property distribution, it is an area which can be greatly served by mediation. Working together, with a mediator, allows the couple to divide their property in a way that makes sense to them, rather than being subject to whatever distribution the court decides upon.