Determining Marital Property in Maryland, Virginia and The District Of Columbia
When you are married, everything you acquire during the marriage is marital property unless it’s a gift or inheritance, proceeds of gift or inheritance, or excluded by a valid agreement. Whether something is marital property does not affect title to the property, transferability, right to possession or anything else. It’s a concept that only matters at the time of divorce. Marital property is what gets divided between the parties by their agreement of the judge’s order.
This post is about when the accumulation of marital property ends. It starts at the time of the marriage. When you return from the honeymoon and go to work the next Monday morning you are earning marital property – the stuff the divorce judge divides. When is the first day you can go to work and earn separate non-marital property? It depends on the jurisdiction.
Section 8-201(e) of the Family Law Article of the Maryland Code provides that marital property means the property, however titled, acquired by 1 or both parties during the marriage. The applicable D.C statute is Section 16-910 which provides in part that the Court shall value and distribute … property and debt accumulated during the marriage. The applicable Virginia statute is Virginia Code Section 20-107.3 which provides in part A.2 that All property … acquired by either spouse during the marriage, and before the last separation of the parties, if at such time or thereafter at least one of the parties intends that the separation be permanent, is presumed to be marital property in the absence of satisfactory evidence that it is separate property.
When you and your spouse have separated, intending to remain separated, and do not have a property settlement agreement, in Maryland and the District of Columbia the property you acquire from the date of separation until the date of divorce is marital property. In Virginia such property it is not presumptively marital, and in general is determined to be separate property, unless special facts and circumstances are established to overcome the presumption.
Property means anything of value including wages, 401(k) accumulations, vehicles, real property, etc. In a particular case, like one with a long separation before divorce where one spouse earned a lot more and acquired a lot more property than the other, this difference in the law can make a huge difference in outcome.
I had such a case a couple of years ago. It was a second marriage, no children of the marriage, the parties had been married a relatively long time but had not spent much time together. The higher earner and our client, the wife, spent lots of time on the road for her employment. The separation was sort of a gradual thing. They had not seen each other at all for about three years. They had only spent holidays together for about the four years before that, and had not had marital relations in all that time. The clearest event establishing the separation was Wife’s purchase of a home in Virginia in her own name with her own funds three years past. Husband lived in Maryland.
We decided to try to make this a Virginia divorce case even though the Virginia Courts did not have personal jurisdiction over the Husband who had never lived in Virginia. I thought it was worth the effort because it seemed unfair that Wife would have to divide everything she had acquired over the seven year period that the spouses had lived apart and had completely separate finances.
I sent a settlement proposal – no response. I filed a Complaint for Divorce and served it on Defendant by mail with a form called waiver/acceptance of service. If he signed and returned it we could go forward. On the last day for a timely Answer I got a call from a Virginia law firm requesting a short extension of time to respond. I agreed and waited for the motion to dismiss that I expected would be filed and then granted, leaving us with a Maryland case in which our client’s accumulated property for seven years of separation and counting would be on the table. I updated our client and told her what I expected to happen.
But it didn’t. Husband’s Virginia counsel filed an Answer submitting Husband to the Court’s jurisdiction and never raised the lack of personal jurisdiction. In the negotiations Husband’s counsel worked tirelessly, brilliantly and somewhat successfully to discover and assert facts to move the date of final separation forward so that husband could share in the substantial property Wife has accumulated during the early years of the separation. Nice work but it would have been totally unnecessary if the case had been filed in Maryland as it should have been. Everything Wife had accumulated for the seven years of separation to date and thereafter continuing to the date of divorce or date of Agreement would have been marital property.
If you have a long separation and a big difference in post-separation property you probably want your divorce case to be heard in Virginia if you are the spouse with more post-separation property and you want it heard in D.C. or Maryland if you are the spouse with less post-separation property. As you can see, a little planning and a little audacity can get you into the Court you want to be in.