Dividing Property in Divorce Mediation
In New York (and most jurisdictions), property is classified as either marital or separate property. I will define each in more detail in future posts. This post shall assume that the property in question is marital property. If the parties cannot agree how to divide their property, the law has a judge make the determination as to how property will be divided. Note the beginning of the last sentence. Mediation gives parties the best opportunity of deciding their own case and not some judge they have never met who will bring to his/her decision making process all the prejudices we all have. This is not an anti-judge statement. I have heard many judges encourage settlement between parties making the same exact argument.
The judge’s role is to divide property “equitably between the parties” taking into account all the circumstances of the case and of the respective parties. This is taken from the actual statutory language. Note the latitude given to a judge. Is it not common sense that you exercise that latitude and not a third party judge?
Equitable division of property does not mean equal division. New York is not a “50-50” state and, therefore, a judge may divide property on any basis that seems fair to him. The New York Domestic Relations Law lays out fourteen factors which a judge must consider in making this determination. Assets and debts are all divided equitably. It is important to keep in mind that when a judge divides assets in a divorce it does not mean every asset is divided equally. “In kind” distribution happens and indeed may be preferable, but many time it is simply not practical. Thus, in practice, assets and liabilities are traded off against each other. For example, a husband might retain his full pension while the wife keeps the house. Obviously, there are many variations of this. In mediation, the parties, with the aid of the mediator, should attempt to perform the exact same task as a judge. There are many wrinkles to how specific assets are often divided, e.g., businesses, deferred compensation, etc. and I will address these in subsequent posts.