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Equitable Distribution case discussion
August 25, 2021

Equitable Distribution

Property division in a New York divorce can be one of the most contentious issues in any divorce action but may be of particular concern for couples going through a divorce after a long-term marriage. While custody or childrearing issues may no longer be on the table, the equitable distribution aspect of the dissolution of marriage later in life can be especially complicated. When it comes to a long-term partnership, there is a much higher likelihood that the divorcing parties have amassed a significant amount of marital property that will need to be distributed by the Court.  Further, the length of a marriage can have serious implications on how the Court deals with making the awards, regardless of which spouse had a greater hand in earning or accumulating the marital property. The Law Office of Lisa Beth Older is knowledgeable about and sensitive to these specific issues and can help you navigate them with care and skill.

If you find yourself facing a later-in-life divorce, first, it is helpful to know that in New York, most property acquired by either spouse during a marriage is considered marital property and is thus subject to equitable distribution by the Court. This includes income earned during the marriage, real or personal property purchased during the marriage, such as a home or a car, retirement benefits earned by either party during the marriage, and any appreciation in value of marital property that occurred while the couple was married. Furthermore, in the case of a later-in-life divorce, issues of splitting up retirement accounts or Social Security benefits can be of immediate and paramount importance.

An important concept to keep in mind when considering equitable distribution of marital property during a divorce is the fact that “equitable” distribution does not necessarily mean “equal” distribution. Equitable simply means fair in the eyes of the Court. However, an equal distribution is often still on the table when a long-term marriage ends, even in situations where there was a large discrepancy in earnings during the marriage.

There are many factors that the Court will use to determine what constitutes a fair division of the marital assets, and in the event of the dissolution of a long-term marriage, the duration of the marriage is key among these  – New York Courts have held that in the circumstances of a long-term marriage, “While equitable distribution does not necessarily mean equal distribution, when both spouses have made significant contributions to a marriage of long duration, the division of marital property should be as equal as possible” [emphasis added] (Kamm v. Kamm, 182 A.D.3d 590, 591). 

Thus, even in situations where one spouse has consistently earned considerably more, the Court may order an equal split of the marital assets based on the length of the marriage among other factors.  In a recent, July 2021 decision, the Supreme Court Appellate Division, Second Department affirmed a 2017 Nassau County Supreme Court judgment of divorce in which the parties’ marital property was divided evenly after a 47-year-long marriage, even where the Husband testified that the parties’ financial partnership had ended years prior – In 1989, the Husband unilaterally divided the parties’ bank accounts and in 2001, the Wife began electing a maximum retirement benefit from the New York State teacher’s retirement system without the Husband’s knowledge. (See: Parkoff v. Parkoff, 195 A.D.3d 936 (2021)

In that case, the parties had amassed in excess of $6 million in marital assets up to the date of filing, primarily earned by the Husband in his capacity as an attorney. The Wife, a schoolteacher, consistently worked throughout the marriage, but earned a much less substantial income. Regardless of the earnings disparity, the Court considered numerous factors in coming to this determination, including the fact that the Wife was the primary caretaker for the parties’ child, holding, that “considering the relevant factors, as well as the circumstances of this case, contrary to the plaintiff's contention, there is no basis for an unequal distribution of marital assets.”

There, the Court noted that the Wife had made alternative contributions to the marriage such as primarily caring for the parties’ child, cooking, and doing housework, and residing with and traveling with the Husband until the dissolution. These factors weighed against the Husband claiming that the economic partnership had been severed long ago. However, even living separately and maintaining separate residences, properties, or bank accounts certainly does not preclude the Court from dividing a marital estate equally in the event of a long-term marriage.

In a 2020 decision, the Supreme Court, Appellate Division, Second Department held that the Suffolk County trial court had improvidently exercised its discretion in directing a 51/49 division of the marital assets after a 33-year-long marriage, even where the parties each maintained their own assets and income separately and lived apart – in fact, in two separate countries – for a substantial portion of the marriage. (See: Achuthan v. Achuthan, 179 A.D.3d 751, 757 (2020).

There, although the Plaintiff/ Husband’s accumulated assets were valued at approximately $2.5 million to the Defendant/ Wife’s approximately $1.2 million, the Appellate Division still determined that in light of the relevant factors – including the length of the marriage – the Defendant/ Wife was still entitled to an equal split. This is because generally, in the event of a long-term marriage, the Court will only deviate from an equal split of the assets for cause – including when one party has engaged in economic fault. If no cause can be shown, the Court may order an equal split where both spouses can be said to have contributed to the marriage.

This general rule provides a safeguard for lower-earning spouses who may fear that a divorce could leave them financially unable to care for themselves in their later years. Equitable distribution of assets can protect a spouse who didn’t work outside the home or earned substantially less than the other spouse while doing so. Similarly, it has the potential to negatively affect the higher earning spouse in situations where the other spouse did NOT contribute to the marriage, financially or otherwise. These types of inquiries are complex and highly fact-specific. 

With over 29 years of legal experience, including later-in-life divorces and complicated splits of financial assets, The Law Office of Lisa Beth Older can help you to better evaluate your likely outcome in the event of the dissolution of your long term marriage.

 

By: Your Manhattan Divorce Lawyer

Lisa Beth Older