Division of property is one of the most complex and frequently contentious issues in many divorces. It may be THE most fraught aspect, particularly in cases where child custody is not at stake. Since 1980, Georgia courts have followed the doctrine of “equitable division” to classify and distribute the marital assets in a divorce. Equitable division (or equitable distribution) is distinct from the “community property” approach taken by certain other states. While community property states generally require that marital property be divided equally (50/50) between the parties, equitable distribution requires that the property be divided fairly—and the courts have explained that a fair distribution is not necessarily an equal one.
Understanding how this practice came to be and how it is applied can help prepare you for how your property could be divided should you pursue a divorce.
What came before equitable division?
With roots in British common law, property division as part of divorce remained virtually unchanged in Georgia from the late 18th century until 1980. In this era, alimony was the only way property titled to one party could be transferred to the other. A husband was not legally allowed to receive alimony from the wife, but the wife could be awarded a portion of the husband’s property—in the form of real property, cash, or otherwise—for her support and maintenance following the dissolution of the marriage. Further, property gifted to or inherited by the wife would remain her separate property during and after the marriage, but the same could not be said of the husband’s property.
How has the law changed?
Firstly, the Official Code of Georgia was amended in 1979 to provide that each spouse would retain their separate property following dissolution of the marriage. Based in part on the recent amendment, the Supreme Court of Georgia in the 1980 decision Stokes v. Stokes formally adopted the doctrine of equitable division to divide property between the spouses in a divorce. This opinion immediately and dramatically changed the landscape of divorce law. In Stokes, although the marital residence was titled in the wife’s name, the court awarded the husband a one-fourth interest in the home on the grounds that purchase and mortgage payments were “furnished by the joint efforts of the parties.” In this case, the basis of the award was neither alimony, partitioning, trust nor fraud, but rather “equitable division of property.” Subsequently, the Supreme Court adopted and developed what is known as a “dual-classification” system: first, the assets owned by the parties are categorized as either “marital” or “separate” property; then, each party is awarded their respective separate property and the marital property is divided between them as the court or jury determines to be fair.
What constitutes martial or separate property?
Assets are categorized as “marital” or “separate” depending on when and how they were acquired. Generally, property that was acquired or earned through the “labor and investments” of the parties during marriage (through employment, management, or otherwise) is considered marital property subject to equitable division. Premarital assets and property acquired by gift or inheritance are generally categorized as separate property that is not subject to equitable division, although it is possible for a party to turn a separate asset into a marital asset by, for example, depositing inherited money into a joint marital bank account or adding their spouse’s name to the title of a premarital home. Additionally, some assets may have components of both marital and separate property, such as where the parties contribute marital money to improve a premarital home. In such a circumstance, the marital estate may be entitled to recover some of the money contributed. Ultimately, these are just default rules and the classification of any particular item of property—and its distribution—is highly dependent on the facts of each case.
What does this mean for your case?
Equitable division in Georgia has largely been determined by common law, so it is left up to the courts to determine based on principles of law and the circumstances of each case what constitutes marital property and how it should be awarded. On the one hand, this offers helpful flexibility to agile litigators as there is little legislative guidance dictating exactly what should happen. On the other, with the law having been developed almost exclusively by judicial decree, nuances have arisen somewhat unpredictably and some areas remain uncharted moving forward. This makes it all the more important to have a skilled and knowledgeable attorney on your side to help you navigate the complexities of your case and get the results you deserve.