What Does Equitable Distribution Mean?

By September 5, 2019divorce

Ohio is an equitable distribution state. When a couple divorces, they must divide their marital property, which is typically all property they acquired after marriage. Equitable distribution is a method of dividing marital property fairly. Of course, what qualifies as fair will depend on the circumstances.

If you have a question about equitable distribution, give us a call. One of our Ohio divorce lawyers will be happy to talk to you.

Community Property versus Equitable Distribution

In a community property state, marital property is divided 50/50 automatically. Community property rules are easy to understand and administer, so they take a lot of the guesswork out of deciding how much property you get after divorce. California is an example of a community property state.

But there are negatives to a community property system. For one, it can be hard to divide certain assets. Many couples have most of their equity in a home, which is hard to split in half. The couple might not be in a position to sell the home and divide the proceeds, so dividing property 50/50 is often tricky.

Fortunately, Ohio is an equitable distribution state, so we can avoid many of the pitfalls involved with community property rules.

What is a Fair Division of Marital Property in Ohio?

How do judges decide what is “fair”? Although it is true that marital property does not need to be divided equally, judges often start from that presumption. As the statute says, “the division of marital property shall be equal” unless there is a good reason for it not to be. Each side has an opportunity to convince a judge that an equal distribution of assets would be unfair.

 Ohio Revised Code 3105.171 instructs judges to look at many factors when determining how to divide marital property equitably, such as:

  • The length of the marriage
  • Each spouse’s assets and debts
  • How liquid the marital property is (can it be easily sold?)
  • Each spouse’s retirement benefits
  • Whether the family home should be awarded, permanently or temporarily, to the spouse who has custody of children
  • Tax consequences on each spouse
  • How much it costs to sell an asset

Judges can essentially look at any factor that seems relevant to deciding how to divide the marital property.

Distributive Awards

Under Ohio’s statute, judges are empowered to make a “distributive award” during the divorce proceeding. This is an award that a judge can make to better facilitate the division of marital property.

For example, the statute allows a judge to put a lien on one spouse’s marital or separate property if the court decides that dividing the asset is too burdensome. Let’s say a couple’s primary asset is their home, which the wife will stay in because she is raising the children. The husband can get a lien put on the home, so that when it is sold the husband gets a portion of the equity.

Judges can also make a distributive award when a spouse has committed “financial misconduct.” Misconduct can take many forms:

  • Concealing assets
  • Wasting assets, such as blowing a couple’s savings on a trip to Vegas
  • Fraudulently conveying an asset to a friend or relative for little money, with the intent to shield it from the divorce

Under Ohio’s law, spouses must make a “full and complete” disclosure of all their property. This includes all separate property, even if their spouse does not know about it. So the hidden trust fund in the Bahamas needs to be disclosed during the divorce. If not, and a judge finds out, then he could award more assets to your spouse.

Marital Misconduct and Equitable Division

Some people ask whether their spouse’s infidelity will impact the division of marital property. Although the statute allows a judge to make a distributive award for financial misconduct, it is silent about other types of marital misconduct.

Ohio courts have spoken to this issue, however. In Lemon v. Lemon, the Fourth Appellate District Court stated that the legislature did not intend for marital misconduct to play a significant role in the division of marital property. If your spouse was unfaithful, it is highly unlikely this fact will impact the division of marital property at all.

Speak with an Ohio Divorce Attorney Today

Equitable division has wrinkles that only an experienced attorney can explain to you. For advice tailored to your situation, please reach out to the Lawrence Law Office today. We offer a confidential consultation to those who call us or fill out our online contact form.

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