What Not to Do With Your Property During a Divorce

 

When you or your spouse files for divorce in Arizona, nearly every action you subsequently take will come under the supervision of the court. This is to prevent one spouse from taking advantage of the other and from defrauding the court. Even the property you have in your possession is subject to the supervision and control of the court until the court makes its final division of property order. Until your divorce is finalized, you should refrain from:

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  • Spending any money except that which is necessary for your daily living expenses. The court understands that you must live and so purchasing food and paying for bills will not concern the court. What will draw the court’s attention to you is spending large amounts of money on frivolous or unnecessary expenses. Even if the purchase is for the benefit of your children (such as taking them on a vacation), spending this amount of money without first obtaining the court’s permission can be viewed as wasting community property and diminishing the value of the property the court is to divide. Any large expenses – a new home, a vacation, a new car – should be presented to the court for approval. You will need to justify large expenditures before you will be able to obtain court approval.
  • Hiding assets or property. Hiding assets – that is, failing to disclose that you have a particular asset, underreporting that asset’s value to the court, or claiming that the asset is missing or destroyed – is a bad idea. While the court may be initially unaware of your deception, chances are your spouse will become aware and will alert the court.
  • Allowing property or assets to depreciate in value or become damaged or destroyed. You have a general obligation to take reasonable care of the property you have in your possession while the divorce is pending. You are not an insurer of the property and the court will not expect you to go to unreasonable lengths in order to preserve the value or condition of the property under your control. For example, you generally would not be expected to ensure your retirement accounts or investment accounts maintain their value in the midst of a decline in the stock market (there is, of course, no way you could do this). However, you are not able to take property belonging to your spouse that is still in your possession and leave it out on the lawn during a rainstorm or burn it in your fireplace.

Maintain the Status Quo as Much as Possible

            In general, when it comes to property and assets during your divorce the court is expecting you and your spouse to maintain the status quo as much as is possible. If you or your spouse fail to do so and the court finds your actions unreasonable, the court can take this into account when dividing the community property. For example, suppose you and your spouse had $50,000 in community property in the form of a deposit account. Suppose that you take $20,000 of this money and use it to purchase a new car without first obtaining permission from the court. The court may consider this to be an unreasonable expenditure and may choose to award your spouse an additional $20,000 in community property to compensate him or her. Alternatively, the court could find you in contempt and order to pay a fine and/or serve a sanction in jail.

When in doubt about what you should or should not do when it comes to property during your divorce, speak with a competent and experienced divorce attorney first.  To find out what not to do with your property during a divorce contact an attorney at our firm for a free consultation.

 

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