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What happens when there is a disagreement over property division?

The property division portion of a divorce can be contentious. Spouses who are looking to split marital assets like real estate, investment portfolios, and retirement accounts may disagree on who gets the asset as well as the appropriate valuation. Courts are generally required to divide marital assets in a “just and reasonable” manner. When doing so, family law requires the court take all marital property into consideration to come to its decision. Legal experts refer to this as the “one pot” theory. This is because the court essentially puts all the assets into one pot before it begins the distribution process.

As noted above, it is not uncommon for couples to have disagreements over the distribution of property. Spouses can take proactive steps to reduce the risk of these disagreements. The following will discuss some common points of contention and legal tools that can help address the issue.

Disagreement #1: Inheritance

A spouse who receives an inheritance may attempt to have the asset set aside to them in a divorce. A spouse can help to better ensure the inheritance remains separate by using a premarital agreement.

Disagreement #2: Business interests

Another point of contention involves spouses who own business interests. Again, a spouse can use a premarital agreement to outline exactly how to split the business interests in the event of the divorce.

If put together in accordance with local laws, courts should honor these agreements. They can be set up to address most types of property, including inheritance and business interests as already discussed as well as real estate, family heirlooms, and vehicles and collectables. Some examples of things the court will look for when determining whether or not the agreement is valid include presence of separate legal representation for both parties and adequate time to review the proposed document as well as a full disclosure of all assets and debts at the time of execution.