What Happens to Property When You Leave Your Spouse Without Legally Separating or Divorcing?

By Rob Jennings J.D.

Leaving a marriage is often difficult regardless of your circumstances, but it can become even harder if you and your spouse accumulated property during your marriage. Even if you don't plan to divorce or pursue a legal separation immediately after leaving, understanding how courts distribute marital property, as well as the law regarding the transference of marital property, is critical in determining what to do next.

Marital Vs. Separate Property

Although property division law varies from state to state, as a general rule, courts are only concerned with distributing marital property. "Marital property" typically refers to property that accumulates during your marriage, or you acquire using the proceeds of marital property. Everything else is separate property, which the court generally does not divide. Exactly how your state defines marital and separate property could mean a difference of tens of thousands of dollars. Some states declare the marriage over for purposes of marital property accumulation on the date the parties separate, while other states use the date of the filing of a divorce complaint or date the divorce decree is issued.

During Separation

All states have no-fault divorce procedures, meaning either party can file for divorce usually after complying with a statutory period of physical separation. North Carolina, for example, requires a one-year separation. During that separation period, state law can vary on when, if at all, the court can distribute marital property. A court can hold spouses accountable for disposal of marital property during the period between separation and the time the court distributes the marital estate. Absent the agreement of both parties, either party generally cannot transfer jointly held assets. If a party unilaterally withdraws marital funds or sells marital assets, the court could later force that party to return the value of the transferred property to the marital estate.

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Valuation and Distribution

While the date on which marital property is valued for distribution can vary based on state law, the terms of asset distribution are also dependent on state statute. Community property states generally require an equal division of marital property, while equitable distribution states require a division that is equitable, or fair. Since "fair" and "equal" aren't always the same things, courts in equitable distribution states can usually award unequal divisions in the presence of certain statutory factors.

The Missing Spouse

Spouses sometimes disappear without a trace for a variety of reasons. This can create a question as to whether that person is still alive. State laws vary concerning the procedures for divorcing someone in absentia, as well as when you can declare someone legally dead. The common law rule is that a person has to remain missing for at least seven years. While the time period of presumed death is written into some state laws, in other states, such as Illinois, seven years is simply the point at which the basic presumption of death arises. However, if a person can present evidence of a party’s likely death, such as an accident in which no bodies are found, state courts can declare the person dead at an earlier date. If your spouse left property or life insurance when he disappeared, you may choose to file for a declaration of legal death at the appropriate time -- and can then collect both his life insurance proceeds and your spousal entitlement to the proceeds of his estate.

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References

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