Also known as: property settlements · property division
Written by attorneys · grounded in primary & secondary sources — see below
A division of marital assets and debts between divorcing spouses effected either by court judgment or by agreement incorporated into the divorce decree.
Preston Pratt represents Phoebe Park in her divorce from Patrick Phan. The couple's primary asset is a jointly owned business whose value will be divided in the property settlement. Preston proposes taking twenty-five percent of whatever Phoebe receives in the settlement as his fee. Because the fee is contingent on the amount of the property settlement, the arrangement violates the prohibition on such fees in domestic relations matters.
Philip Powell and Pierce Patterson hold their marital home as tenants by the entirety. While divorce proceedings and a property settlement are pending, Philip executes a will leaving his interest in the home to a third party. Philip dies before the divorce is final. Title to the home passes by operation of law to Pierce under the right of survivorship rather than under the will or any property settlement terms.
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Once a court enters a final property distribution in a divorce, it ordinarily may not revoke or modify that division absent exceptional grounds such as fraud or similar defects that would justify reopening a final judgment. Mere subsequent changes in a party's financial circumstances are not enough to reopen the property award.
No. Model Rule 1.5(d)(1) prohibits a lawyer from entering into an arrangement for, charging, or collecting any fee in a domestic relations matter when the payment or amount is contingent upon the amount of alimony, support, or property settlement in lieu thereof.
Unless the agreement provides otherwise, a complete property settlement entered into after or in anticipation of separation or divorce constitutes a waiver of all rights of elective share, homestead allowance, exempt property, and family allowance, as well as a renunciation of benefits that would otherwise pass by intestate succession or under a prior will.
A pending divorce proceeding and property settlement do not destroy the tenancy by the entirety. If the testator dies while still married and the tenancy remains intact, title passes by operation of law to the surviving spouse rather than under the will or the terms of the property settlement.