Not exactly, but that is how a lot of people feel when it comes to property distribution (equitable distribution) in divorces. We often hear “But that’s MY pension, I earned it! Why do I have to share it with my spouse?” Fill in any word after “my” and you get the idea (house, car, bank accounts, investments, businesses, etc). However, it is important to note that what is yours may be subject to distribution, but it is highly unlikely you will either get it “all” or conversely, give it “all” up. Instead of “what’s mine is mine and what’s yours is mine, too”, the reality look like this: “what’s mine is ours and what’s yours is ours, too”.
In New Jersey, any and all property, both assets and debts, acquired during the marriage, regardless of whose name the property is held in, with few exceptions, is subject to equitable distribution. The marital estate is generally determined as that which was obtained between the date of marriage and the date of the complaint. Of course, there can be exceptions to this, but this is the general rule.
It is significant to note that New Jersey is NOT an EQUAL distribution state, but an EQUITABLE distribution state, meaning whatever is “fair”. In deciding how to fairly distribute the marital estate, the parties have a lot of latitude. For example, the parties can divide assets and debts by type meaning all of the bank accounts will be treated the same way, all of the credit card debts will be treated the same way, the vehicles will be treated the same, etc. Or the parties can decide to take a global view and allocate the estate in a way that they find fair even if they do not divide each line item the same way. A common example is that one party wishes to retain the home and gives up other things that they may have been entitled to in order to do so in order for the distribution to be overall fair and equitable.
If the parties cannot reach an agreement and the Court has to rule on equitable distribution, the Court will apply the statute, N.J.S.A. 2A:34-23.1, in making an equitable distribution of property and the Court is required consider, but not be limited to, the following factors:
(1) The duration of the marriage;
(2) The age and physical and emotional health of the parties;
(3) The income or property brought to the marriage by each party;
(4) The standard of living established during the marriage;
(5) Any written agreement made by the parties before or during the marriage concerning an arrangement of property distribution;
(6) The economic circumstances of each party at the time the division of property becomes effective;
(7) The income and earning capacity of each party, including educational background, training, employment skills, work experience, length of absence from the job market, custodial responsibilities for children, and the time and expense necessary to acquire sufficient education or training to enable the party to become self‑supporting at a standard of living reasonably comparable to that enjoyed during the marriage;
(8) The contribution by each party to the education, training or earning power of the other;
(9) The contribution of each party to the acquisition, dissipation, preservation, depreciation or appreciation in the amount or value of the marital property, as well as the contribution of a party as a homemaker;
(10) The tax consequences of the proposed distribution to each party;
(11) The present value of the property;
(12) The need of a parent who has physical custody of a child to own or occupy the marital residence and to use or own the household effects;
(13) The debts and liabilities of the parties;
(14) The need for creation, now or in the future, of a trust fund to secure reasonably foreseeable medical or educational costs for a spouse or children; and
(15) Any other factors which the court may deem relevant.
Before anyone can engage in equitable distribution, however, it is extremely important to know what falls within the marital estate. Only property actually subject to equitable distribution counts so it is critical to know when each asset or debt was acquired, how it was acquired, how it was maintained, its value and the like so that analysis can be conducted. Unfortunately, it is common for parties to be so focused on the prize and keeping the asset that they want that they inadvertently overpay for the right to keep it. Do not engage in equitable distribution talks, even informally, without first consulting counsel.