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Long separation before Florida divorce could be financially problematic, part 2

On Behalf of | Apr 6, 2021 | divorce, Property Division |

In part 1, we explained that under Florida law the marital estate usually consists of the marital assets and debts as of the date of the divorce petition filing – called the cut-off date. The marital estate is the totality of property and liability equitably distributed between the divorcing parties.

Roughly and with some exception, property and debt either spouse acquires as an individual before the marriage or after the cut-off date is nonmarital, separate property that they each keep and is not part of the marital estate. Property an individual gets as a gift or inheritance from a third party is also nonmarital.

Freezing the estate

The marital estate morphs in size and value during the marriage as assets and debts rise and fall, but it must be frozen as of a certain date so it can be divided in divorce. As we discussed in part 1, this cut-off date is usually the divorce petition filing date.

A recent case illustrates this concept. In Jackson v. Blazer, the Second District Court of Appeal of Florida said that the trial court had incorrectly classified three vehicles and a car loan as all part of the marital estate.

Instead, the appeals court said that all were nonmarital, separate assets (and debt). The husband had purchased one car before marriage and each spouse had purchased a vehicle after the date of divorce petition filing. The cut-off date was the date of filing since there was no separation agreement, so all three vehicles were nonmarital, belonging to their owners individually and not subject to division in divorce. Similarly, the wife took out the auto loan after the cut-off date so that liability is nonmarital and hers alone.

Takeaways

It likely would have come out differently if they had been living separately but still married and had not filed for divorce at the time each bought a new vehicle. The cut-off date would probably have been after the purchases and loan, so all except the vehicle bought before marriage by one spouse would have been part of the marital estate subject to division.

The choice of cut-off date – usually the petition filing date – can make the difference in whether a spouse can be subject to receiving significant assets or debts in the divorce. For example, if a spouse received a large bonus before the cut-off date, it would be marital and subject to division, but if the spouse received it after, that money would be separate property and that spouse’s alone.

 

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The Law Office of Forrest & Forrest, PLLC represents individuals in Fort Lauderdale in high-asset divorce matters. Daniel Forrest is board-certified family lawyer and mediator serving the South Florida area.