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Divorce and Property Division in Michigan

I am a divorce lawyer or family law attorney in Oakland County, Michigan. My office is centrally located near Troy and Birmingham, in Auburn Hills, Michigan which is easily accessible to Rochester, Rochester Hills, Clarkston, Bloomfield, Oxford and Lake Orion.  An issue that one must deal with in virtually every divorce is division of property.

The Issue

How will the court divide property in a divorce in Michigan?

The Answer

The case of Kaiser v Kaiser, Mich App Docket No 311014, November 5, 2013 (unpublished) provides a good example of the analytical framework that the court must follow when considering this issue.  The husband appealed the divorce court's award of three pieces of real estate to the wife as her sole and separate property.

The analysis begins with deciding whether the property is marital or separate.  Generally, marital property is divided between the parties and a party's separate property is awarded to that party without invasion by the other party.  Marital property is that which is acquired or earned during the marriage while separate property is that which is obtained or earned before the marriage.

Of course, there are exceptions.  An inheritance received by one spouse during the marriage and kept separate from marital property is considered separate.  Conversely, separate property may lose its designation as such if it is commingled with marital assets and treated by the parties as marital property.   How the property is titled does not determine whether it is separate or marital.

Finally, there are two statutes which allow a court to invade one spouse's separate property and distribute some or all of that property to the other spouse.  Generally speaking, the separate property may be invaded where the other spouse requires it for suitable support and maintenance, or where one spouse has significantly assisted the other in the improvement, growth or acquisition of that separate property.

In this particular case, the court followed the analytical framework as follows.  the court found that that the parties lived together for 25 years and they purchased the properties shortly after the marriage. The wife held title to the three properties because the husband's parents obtained a judgment against him for $50,000 and the wife paid that out of her own future inheritance and with money she borrowed from her sister.  In turn, the husband signed quit claim deeds for the properties to the wife in 2003.

Although assets are not separate simply because they are owned by one spouse individually, the fact that he gave up his claim was significant when considered with his actions following the transfer.  After the transfer, there was no evidence that he took any financial responsibility for the properties after its conveyance and refinancing.  The wife paid all of the payments relating to the mortgages, insurance and taxes.  The husband claimed he performed some work on the properties; however, it appears that he actually caused damage to the properties when he attempted to repair the same.

The court found that this was sufficient to consider the property the separate property of the wife.  One question however, is how the wife could have been separately financially responsible for the payment of the mortgages, insurance and taxes as any income that she earned and used to make these payments from 2003 to the date of the divorce would have been marital income.  At any rate, the court determined that these properties were the separate property of the wife and the husband then claimed the court should have invaded the separate property and awarded him a portion of the same under the two aforementioned statutes.

The court refused to invade the separate property.  First, it found that he was awarded his own business; he has worked for 12 years at a plastics company and has a realtor's license.  The court found that this meant that he did not have insufficient income for his support.  Second, the court found that the did not make any contributions to the property that would allow invasion, in fact, his alleged repairs to the property caused damage to the property and it refused to invade the property on this basis.

Summation

This is an interesting case as it does appear that despite the court's findings the wife must have used marital funds to pay for the properties and thus commingled the property after the transfer in 2003.  At any rate this case provides a good example of the framework the court must follow when dividing property.

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