The commonwealth’s property-division statute is extensive and legally complicated.
Because it will impact the standard of living of each spouse possibly for the rest of his or her life, one of the biggest matters of concern in divorce is the division of money, personal property, real estate, investments, retirement benefits and other types of assets, as well as of debts. In Virginia, the statute that controls the division of property stands out for a couple of reasons: its complexity and its consideration of spousal fault and bad behavior as a relevant factor in property-division decisions.
Property division by agreement
As a practical matter, regardless of what the law says, a married couple may negotiate the details of property division in a binding agreement. It is important to speak to an attorney about the classification of each asset and to determine a fair value before agreeing to division and future ownership. This property settlement normally becomes part of the final order of divorce in court.
If the parties entered into a valid premarital agreement, its provisions may impact the final property division as well.
Nature of Virginia property-division rules
If the parties have not agreed to the terms of property (and debt) division, the judge in the divorce will make the decision. The Virginia statute that governs property division is easily among the most complex of comparable laws in other states. In this article, we will discuss the main provisions, but an attorney should be consulted to explain the law in all of its detail as it would apply in any given divorce, especially when a couple has substantial worth, or when the particular assets are unique or difficult to characterize.
Separate and marital property
The court must determine:
- Title, ownership and value of all property
- Classification of all property as separate, marital, or part separate and part marital
- Nature of all debt, joint and separate
- Classification of all debts as separate or marital
Broadly, separate property is that which:
- Was owned by either party before the couple married
- Was given to either party by gift or inheritance during the marriage by a third party
- Was income generated by separate property to the extent it was not from the significant, personal effort of either spouse
- Was an increase in value of separate property to the extent it was not “substantial appreciation” from the significant, personal effort of either spouse or not from the impact of marital property
The last two categories may result in property being classified as part marital and part separate.
Marital property is generally that which:
- Is jointly titled in both spouses’ names, with some exception
- Was income generated by separate property to the extent it was from the significant, personal effort of either spouse
- Was an increase in value of separate property to the extent it was from the significant, personal effort of either spouse that caused substantial appreciation or from the impact of other marital property
- Was anything else acquired by either spouse during marriage not defined as separate
Special, complex rules apply to the classification of certain kinds of property, which often become mixed in nature: pensions, retirement benefits, profit-sharing, deferred compensation plans, workers’ compensation, personal injury recovery, property that consists of commingled separate and marital property, and certain instances when an asset’s title is changed from single to joint.
Similar rules apply to characterize debt as separate or marital.
Factors for property division
Broadly, the standard for division of both property and debt is equitable distribution, based on principles of fairness. This is not necessarily a split into two equal halves, but a fair division considering a list of factors and anything else relevant to fairness. Some of the listed factors:
- Contributions to the family’s “well-being,” and to getting and maintaining property
- Length of marriage
- Spousal age and health
- Reasons for the marriage ending, specifically including certain grounds for divorce like adultery or other kinds of sexual behavior, certain felony convictions, cruelty, desertion, abandonment or behavior causing fear of harm
- Tax ramifications
- Expenditure of money by one spouse “in anticipation of divorce”
- And others
The judge also has the option to order the transfer of a sum of money from one spouse to the other to make the overall property division equitable.
Attorney Tom Breeden of Thomas R. Breeden, P.C., in Manassas, Virginia, represents spouses in divorce and legal separation, including matters of property division and other related issues like alimony, child support, child custody, visitation and more in the Manassas area and throughout Prince William County, Virginia.