North Carolina Divorce Lawyers Blog

Articles Tagged with Equitable Distribution

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Equitable Distribution in North Carolina is a legal process by which the court divides the marital property between the parties. It involves three steps: 1) classifying the property as marital or separate (or some mix); 2) assigning value to the property; and 3) distributing the property in an equitable manner between the parties. We have written a lot with emphasis on the first step of the analysis, classification. This makes sense in that the court will only distribute marital assets and not touch the separate. So today we will talk about the second step, valuation.

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Foxx v. Foxx, 2022-NCCOA-223 (5 April 2022) (unpublished).

Some statutes and case laws in North Carolina have a time component. In modifications of child support and custody, the trial court is sometimes required to make comparisons between the old facts and circumstances with the current ones in order to find whether there has been a substantial change in circumstances. Sometimes the old facts and circumstances just don’t exist because the prior order was a consent order. In these cases, trial courts ought to make findings about the facts in play at the time of the prior order, so as to make acceptable comparisons. In equitable distribution, one such statute asks the court to compare the income and estates of the parties at the time of the division of property. Again, it asks for a comparison at a specific point in time. Below is a case where the trial court did not make such comparison. Continue reading →

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Maddukuri v. Chintanippu, 2022-NCCOA-128 (1 March 2022)

Stipulations are often used to expedite portions of a case/trial so that there is no time wasted on them, allowing the court to focus on the issues that are actually in contention. The use of stipulations of fact is pretty common. It removes the inconvenience of having to show evidence of facts that no one contests. Stipulations can also be used for settlement. These allow for the concession between parties of some rights in return for others. Below is a case where the Court dealt with the potential withdrawal of a stipulation. Continue reading →

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Sam Willis and Sarah Willis were married in August 1981.  Sam filed his Complaint on March 28, 1985, seeking a divorce from bed and board, alimony, and equitable distribution.  Before the parties married, Sam sold Sarah a house and lot on Claremont Road.  Throughout the marriage, the couple lived at the Claremont Road property.  Sam made all of the mortgage payments during the marriage.  These payments amounted to $9,900.  Sarah appeals from the equitable distribution judgment entered pursuant to N.C. Gen. Stat. § 50-20. Continue reading →

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Harris v. Harris, 352 S.E.2d 869, 84 N.C.App. 353 (N.C. App. 1987)

In the case above, the plaintiff was ordered to pay to defendant an Equitable Distribution (ED) distributive award in the amount of $23,706.82, but payment of the award was postponed until the parties’ youngest child reached age 18 or graduated from high school. The Court of Appeals reversed because, at the time, such a postponement would have extended the distributive award to seven years after the termination of the marriage. This was significant, as the court is not to order a distributive award that would be paid “over such an extended time period that the payment thereof will be treated by the Internal Revenue Service as ordinary income.” Here, the courts look to IRS regulations to prevent taxes on the transfer of property incident to divorce, and IRS rules say gains or losses that result from transfers are not treated as ordinary income if they relate to the cessation of the marriage. However, if a transfer occurs more than six years after the termination of the marriage, one presumes it is not related to the cessation of the marriage. 26 CFR § 1.1041-1T.  That would be rebuttable but involves more work. Continue reading →

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ZIMMERMAN V. ZIMMERMAN 2021-NCCOA-485

Previously, we have written about the use of stipulations in a case to maximize efficiency and what is required in an oral stipulation in the context of Equitable Distribution. (Our courts have held, for an oral stipulation on Equitable Distribution to be valid, that the parties must be read the terms of the stipulation and questioned as to whether they understand the legal effect of the agreement and then agree. McIntosh v. McIntosh, 328 S.E.2d 600, 74 N.C. App. 554 (N.C. App. 1985)). Continue reading →

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Wall v. Wall, 536 S.E.2d 647, 140 N.C. App. 303 (N.C. App. 2000)

There are various legal mechanisms by which former spouses separate their personal and real property. One mechanism is Equitable Distribution (ED). Practically speaking, however, no division of property should be accomplished without first obtaining an Order/Judgment from the court. This is especially true for more valuable and unique assets like real property. So what happens if you have your hearing, but don’t get an Order in a timely manner? Continue reading →

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Divorces among the stars continue to spark gossip throughout Hollywood, but recent developments in Kelly Clarkson’s divorce from Brandon Blackstock are turning heads.  The couple divorce papers were filed in June of 2020, after seven years of marriage.  Blackstock served as Clarkson’s talent manager during the marriage.  Recent reports note that he is opting for a post-divorce life out of the limelight by becoming a full-time rancher on the former couple’s ranch in Montana. Continue reading →

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In North Carolina, a stipulation, in the legal context, is an agreement between the parties in a lawsuit. It is most commonly used by parties to extend deadlines for responding to discovery or to agree on a factual finding that is uncontested. It can be done to minimize costs in litigation, because there is no need to spend time proving something that is agreed upon. Good practice dictates that stipulations are written and signed by the parties and/or attorneys and then presented to the court. Continue reading →

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Desai v. Desai, No.COA20-435 (July 2021) (unpublished)

An interim distribution is an order of the court that can be entered anytime after the filing of the equitable distribution (ED) claim and before the final judgment on equitable distribution. In these interim orders, the court can classify, value, and distribute certain assets or debts. This partial distribution can also provide for a distributive award that one party pays the other in exchange for the distribution of an asset or debt. So how does this affect the final judgment? Below is a case that explains simply what should happen. Continue reading →