New York Divorce Law...

New York Law - How Do We Divide Part-Marital / Part-Separate Property?

When separate property is traced into marital property, the party can be entitled to a reimbursement.

In some cases, the courts have awarded reimbursement without interest or appreciation.

In other cases, where the appreciation was totally passive in nature, the courts have awarded reimbursement with appreciation.

In still other cases, where the spouse worked on the property to get it to increase in value, then part of the increase in value is marital property.

Cases:

Garvey (1996) 636 NYS2d 893 (The wife contributed $7,200 of separate property to the start up of the husband's car dealership. The wife was a homemaker, raised the three children, and never had a "career-oriented" job after the marriage. The marriage lasted 27 years. At the divorce, the court awarded the wife half the business, which came to $225,000 plus 47% of the net proceeds of the sale of the home. The wife asked the court to also award her $7,200. The court held that she had contributed the $7,200 to a marital activity. This is different than a mere acquisition of property or improvement of property. The court held that it would not be right for the $7,200 to be returned to wife before the business was valued.)

Hartog (1995) 623 NYS2d 537 (Passive appreciation was separate property, but where the husband was a director in a business, the court could conclude that 25% of the appreciation in the husband's share of that business was marital property. Also, the husband's bonus, paid after the divorce was filed, but earned before, is marital property subject to division).

Feldman (1993) 605 NYS2d 777 (passive appreciation held separate property).

Glazer (1993) 593 NYS2d 905 (The husband was entitled to $5,000 reimbursement for $5,000 of "separate property" he invested in the downpayment on the home. The $5,000 was provided from an inheritance from his parents. Although the court does not say whether the home was appreciated, we can guess that it was, because the marriage had lasted 23 years).

Heine (1992) 580 NYS2d 231 (Husband's separate property was used for the downpayment on Manhattan townhouse. The downpayment was approximately 23% of the purchase price. The wife then oversaw extensive renovations. Also, the mortgage was paid out of marital funds over the years. The couple purchased the townhouse about six months after the marriage. The marriage lasted about 17 years. The court awarded the wife 50% of: the value of the townhouse minus the downpayment. Since the townhouse had become worth $2.5 million, the wife essentially got half the property. If the husband paid the capital gains tax, he was entitled to deduct 50% of that from the amount he paid the wife. But the husband was allowed to keep increases in value in marital stock in a company in which the husband was a director. The increases in value occurred after the separation, and the increases were "active" not merely passive increases. The husband was one of 20 members of the board of directors of the company, and the husband made the decision to re-invest in the company after the key shareholders bought the company.)

Monette (1991) 576 NYS2d 416 (contribution to home was entitled to reimbursement into separate property. But the separate property portion did not "appreciate" in value over time).

Butler (1991) 574 NYS2d 387 (A contribution to the home from separate property was entitled to reimbursement into separate property).

Mahlab (1988) 531 NYS2d 580 (The wife was awarded sole possession of house where the source of funds for the house was the wife's father, and where the husband contributed little or nothing to the marriage financially.)

Price (1986) 511 NYS2d 219 (Husband owned some of a wholesale kitchen parts distributor. During the marriage, the wife was a homemaker and parent. The ownership of the company was a gift from the husband's father, and thus was separate property. The court concluded that, where wife contributed to the family unit as homemaker and parent, which allowed the husband to devote time to the business, then the appreciation of the company became marital property. Thus, the wife was entitled to share in the appreciation of the husband's separate property.)

Email this page on to a friend.

Disclaimer: We are not giving legal advice. No warranties. We disclaim all legal liability. More...

Click here to go to top New York divorce law page.

Click here for the New York divorce legal table of contents.