HOW DOES THE TITLING OF A PROPERTY COME INTO PLAY DURING A DIVORCE?
A key part of divorce is separating property between the two spouses. This area, like most aspects of divorce, can create extremely bitter and difficult arguments that make resolution impossible without going to court. When the property at issue involves titles—such as automobiles and real estate—keep in mind that the way it is titled is not dispositive of who will receive that property at the conclusion of your divorce. Additionally, the property division may result in the need to modify documents to reflect appropriate divisions of the property. Below is a discussion of common issues dealing with property titles and divorce.
Effect Of Property Titles During Property Division: Kansas is an equitable distribution state. Generally, property that an individual brings into a marriage is treated as that spouse’s sole property. However, equitable distribution means that upon filing for divorce, all other property is considered martial property belonging to both. The court will make an equitable distribution, meaning the goal is a fair division between both parties. Thus, regardless of how property is titled, it can be distributed to either spouse. And this division won’t necessarily be 50/50 split for each party, but instead will be determined by looking at a number of factors. These factors, listed in K.S.A. 23-2802, includes the age of spouses, length of marriage, earning capacities, family obligations, and how property was acquired.
Titling property in one spouse’s name is certainly not worthless, however. In fact, the titling of property folds into the K.S.A 23-2802 factors. The court will likely find titling to be strong evidence of the source and manner of acquisition for property. Fairness will also be a factor in the division, and titling suggests a specific interest in property that the court should consider. The court In re Marriage of Takusagawa noted that titling is a strong indication of party’s intentions to keep certain property separate, particularly when no other explanation is offered for why only one name appears on the title. And because the ultimate goal of property distribution is a fair result, titling can prove to be helpful objective evidence of what the parties considered “separate” property.
Titles Of Property Following Divorce: When property is divided during a divorce, the parties may be required change how the property is titled. This commonly occurs in the context of real estate. Couples often purchase homes together, titling the real estate in both their names. A common division used by courts requires one party to retain the home and repay the other spouse for his or her share of the equity. The non-possessing party’s name may need to be removed from the title as part of this process. Failure to do this can result in difficulties selling the house for the retaining spouse and responsibilities arising from the property for the non-retaining spouse. Everyone’s interests are served by “cleaning up” the titles to property, even absent a court order to do so.
Titling may also need to be altered based upon debts of the couple. Again, the court will divide debts between spouses. Debts attached to specific property, such as a mortgage on a house or loan on a car, will likely need to refinanced.
Titling property serves several purposes. In the context of a marriage and divorce, titling can be very useful information for the court to consider. It is important to remember that title to property does not settle the question as to who will receive the property. In practice, courts will not often be influenced simply by how an asset is titled. The ultimate goal of the court will always be to achieve a fair distribution of property. Further, failing to adjust titles can result in difficulties long after the divorce with creditors or buyers of property. It is important to talk with competent and experienced legal counsel about these issues to ensure that property is titled in a way that lends to a fair, agreeable division.