Under New York law, the parties’ property is subject to equitable distribution in a divorce. Equitable distribution does not mean that all property is split equally. Rather, marital property is divided “equitably.” Equitable distribution can be a complex and prolonged process.
First, property must be identified as either marital or separate property. In New York, there is a strong presumption that all property is marital property regardless of how the asset is titled. The party claiming property as his or her own separate property carries the heavy burden to prove that the asset fits into statutorily defined categories, including property acquired before the marriage; property acquired through gift, inheritance, or bequest; personal injury damages; and property acquired in exchange for separate property.
Second, marital property must be valued by an expert in advance of trial. Marital businesses should be evaluated by a business appraiser. Marital real estate should be appraised by a real estate appraiser. It may even be necessary to retain a financial expert to assign values to pensions and deferred compensation.
Third, if the parties are unable to reach an amicably resolution, the court must distribute marital property “equitably” in accordance with factors set forth in the Domestic Relations statute. Courts consider, among other things, the income and property of each party; the duration of the marriage and the age and health of both parties; the wasteful dissipation of assets; transfers made in contemplation of divorce; and acts of domestic violence against the other party.
Equitable distribution of marital property is generally granted only after a comprehensive trial on all financial issues.