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Marital asset issue

Started by mistoffolees, Jan 29, 2007, 08:22:35 AM

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mistoffolees

Married 14 years, my wife had 2 daughters from previous marriage. First husband was paying $300 per month per child ($600 / month total) in support. My wife had sole physical custody.

About 6 or 8 years ago, we opened investment accounts to save money for college for the girls. These accounts were opened in my wife's name.  They were NOT set up as custodial accounts and are not Section 529 accounts - simple investment accounts.

During much of the past 6 years, we deposited her child support check into our joint checking account and then later in the month put $600 into the investment accounts. The amount sometimes varied, but it was often $600.

During that time, the girls were in private school ($7 K per year each) at my expense, plus I provided food, shelter, vacations, clothing, transportation, etc at an upper middle class level. The child support obviously didn't cover much of that.

Wife (STBX) is arguing that since we deposited the same amount into the investment account that it's not a marital account - even though the checks were deposited into our joint checking account and a separate check was sent later to the investment account. I argue that the money was actually used to pay for food, clothing, shelter, etc (since that's what support is supposed to pay for) and that the investment money was from my funds.

In your opinion, are those investment accounts marital property or not?

Thanks.

socrateaser

>In your opinion, are those investment accounts marital
>property or not?

Very tough question without knowing the specifics of the state law where a divorce is filed and where the financial activities actually took place. Many of these sorts of issues are resolved in case law decisions, because they are too complex any obvious statutory resolution.

On the surface it seems to me that the issues will be:

1) Why is the investment account only in one spouse's name, and;

2) What was the spouse's agreed intent in placing the funds into this account.

I would say, that at the point that the money was deposited into a joint checking account, it would be presumed to be used for marital purposes, rather than for the benefit of only one spouse.

But, as the exact amount was quickly removed from the checking account and moved to a single spouse's investment account, that this suggests an agreement that the money wasn't really for joint purposes, but rather the deposit in the joint account was merely a temporary convenience.

This is where we get to questions #1-2 above. If the reason for the investment account being in one spouse's name was merely another convenience or oversight, then it would be irrelevant. But, if the purpose was to facilitate one spouse's separate finances, then the money is separate. Also, if the reason is to achieve some unlawful purpose (e.g., to avoid creditors), and you were a participant in the scheme, the court could refuse to give you any relief as to the account, although if you can show that your spouse was equally involved, than that would create what is known as "pari delecto," meaning you're both bad, so the court will ignore the problem entirely and treat the money under the law with no consideration of your bad behavior.

This doesn't get me to a resolution. It just shows you how quickly the situation can become too complex to resolve without specific knowlege of local law.

You're gonna need a local lawyer with family law experience.

mistoffolees

For what it's worth, we did it because my wife felt that if we ever split up or if anything ever happened to me that she'd like some money of her own (not realizing, of course, that it wasn't that simple). The intent was not to use the child support specifically for college. Instead, we wanted to save some extra money for future use (we considered buying retirement land with it at one point) and that amount was a convenient amount. And we certainly never tried to hide from creditors or other similar purpose.

I'll get with my lawyer.

Thanks.