Division of Assets in a Divorce and or a Dissolution Action
One of the biggest disputes in Washington when there is a divorce or dissolution action is “who gets what.” Parties that have assets and must divide them often have disagreements over items and their value.
The Washington state rule on division of assets is governed by “Community Property” principles (laws). The basic rule states that any property and/or assets acquired during marriage is PRESUMED to be community property and thus it must be divided at the time the final decree of dissolution is entered. One of the exceptions to this rule is assets that are acquired solely by one spouse as a gift, bequest, or inheritance is considered separate property. In addition, assets acquired prior to marriage are also presumed to be separate property (subject to some exceptions).
There are some other considerations and special rules of how property is distributed when people live together in a stable relationship but never married in Washington. The most common approach is for courts to divide the property in a just and equitable manner. Essentially, it is the same rule we have for Community Property. The leading cases are Lindsey vs. Lindsey, 54 Wash.App. 834, and Canel vs. Francisco, 127 Wash.2d 339.
The essence of the law is that in a stable marriage like relationship, where the parties cohabitate (what is sometimes called a quasi-marital community) Courts will evaluate the interest of the party and the property they acquired during the relationship and make a just and equitable distribution of that property.
However, they are going to focus only on property acquired during the relationship, not before or after (in a quasi-marital community), just during the relationship. They will also require a rebuttable presumption that the property is not owned by both parties together.
The fact that the title may be in one person’s name alone is not enough to rebut that presumption.
Property acquired before the relationship or even property acquired after the relationship as well as property clearly acquired by gift during the relationship is separate and not before the court for distribution.
All separate property is not before the court in a Quasi-Marital Community, this is significantly different than the rule we just reviewed regarding Community Property. Remember in the community property laws, when the party divorces or has a separation the court will look at all of the property they own.
There is one extra rule here we would like to discuss in this short article: If separate property is improved by funds or labor of either party during the relationship (often referred to as quasi-community funds or quasi-community labor), there is a right to reimbursement by the community off set by any benefit the community received.
Two people could start living together and if the relationship is stable enough to constitute a meretricious relationship the court could apply community property principles to the distribution. The court could attribute any labor by either party to improve the other’s business as quasi-community labor which is presumed to be for the benefit of both of them. Thus once two individuals start living together, labor by either one of you is presumed to be for the benefit of both; therefore, the court could determine that one of the parties has a right to the other party’s seemly separate business.
As you can see, the laws and rules Washington State follows can be confusing to situations where the parties had assets, a business, income, and/or retirement prior to the marriage. It can also be confusing when the parties never married, but by operation of law, they created a quasi-community relationship.
To discuss how a dissolution action will affect your rights over property, please contact our office at (509) 927-3546.
Overview of This Area of Law
What is a Marriage? (legally speaking)
Illegal Marriages in Washington (and Spokane)
Prenuptial Agreements in Washington
Divorce: Filing, Deadlines, and Other Issues
Divorce: Temporary Orders and Motions
Parenting Plans in Spokane County
Child support in Spokane County
Division of Assets in a Divorce
Third Party Actions in Spokane County