If you are getting divorced in Oregon, do you know what property you get to keep and what you have to split with your spouse? And who will be responsible for your marital debts?
When faced with the task of dividing property at the end of your marriage, one of the first things you should know is that Oregon is an equitable distribution state. Equitable division means that a court will split the property between spouses in an equitable, or fair, way. The division does not have to be equal to be fair.
The court’s involvement assumes, however, that you and your spouse can’t or won’t work together to settle your property disputes. You have the option to do the division yourselves and give the court your decision in a written document called a marital settlement agreement. Generally, the court will accept your preferences regardless of the fairness or equality of the split. If there are certain assets you can’t agree on, then the court will divide them for you based on a set of factors designed to give an equitable result.
Before the court can divide your property, it needs to know which property belongs to the marriage, which belongs to you or your spouse separately, and how much there is of each. Generally, marital property is all property acquired or earned during the marriage. Separate property is property you owned before marriage. It could also include property that you received during marriage like a gift or an inheritance, among other things. All of the marital property must be divided. The court may include separate property too, if that’s the just and proper thing to do.
In Oregon, the court will presume that the spouses contributed equally to the acquisition of most property during marriage, regardless of what title says. Property acquired equally will be split equally. The only assets left out of this presumption are gifts to one spouse that are always kept separate. The law includes any devise, bequest, operation of law, beneficiary designation or inheritance under the definition of “gifts.”
Just because the court must presume the spouses contributed equally to the marital property, does not mean that was necessarily true during your marriage. You can convince the court to drop the presumption and divide the property more equitably by showing, more probably than not, that your spouse did not contribute equally when the marriage gained a particular asset. Non-monetary contributions like being a homemaker, however, count the same as monetary efforts.
For example, in one case a husband owned a farming business before marriage. During marriage, his wife worked in the business on-and-off, but most of the time she worked as a homemaker. The value of the business increased during marriage; the amount of this increase was marital property and in dispute at divorce. The husband attempted to show that the wife did not contribute equally to that asset, but the court disagreed. Even though the wife put little time into the business itself, her contribution as a homemaker freed the husband to grow the business, so the presumption of equal contribution remained.
The court considers several factors to split the marital property and potentially your separate property too, equitably. These factors include the amount of property and reasonable costs involved if certain assets must be sold to divide them. It also considers taxes and any other costs reasonably anticipated by the spouses like medical bills or needs of children, to name a few. Additionally, the court will also evaluate retirement plans, pensions, and a spouse’s contribution as a homemaker. One factor the court will ignore is a spouse’s fault in causing the marriage to fail. Fault does not matter in the division of property.
The most common types of property divided at divorce are real property like the family home, personal property like jewelry, and intangible property like income, dividends, benefits, and even debts. At divorce, debts are treated the same as any other property. If acquired during marriage, then it is presumed marital and will be split accordingly. If not, then the court will apply the same factors above to assign responsibility for it.
Spousal support (alimony) is a payment from one spouse to the other to help sustain the recipient spouse after marriage. Usually, the court will divide the property first. Then, if both spouses have enough to keep a lifestyle close to the one they had during marriage, spousal support may not be necessary. Where one spouse has an additional need, however, then spousal support can fill the gap.
If you request spousal support, the court could order your spouse to make payments t to help you transition back to work (transitional spousal support), to reimburse you if you contributed to your spouse’s career advancement during marriage (compensatory spousal support), or to help you maintain a certain standard of living (spousal maintenance). Depending on the type of support, the court will base its determination based on the length of marriage, health and ages of the spouses, support of children, the marital standard of living, and the earning capacity of each spouse, among other things.
The court has discretion in what to award and for how long. Under some circumstances, it can award spousal support to even-out an imbalanced property distribution in addition to the types of support above. Where spousal support is used in this way, the obligated spouse must maintain a life insurance policy to cover the amount and keep your spouse as the beneficiary of that policy for those ten years.
You can read the law on division of property and spousal support in the Oregon Revised Statutes subsections 107.105(f) and 107.105(d), respectively. The case dealing with the presumption of equal contribution during marriage is Matter of Marriage of Massee, 970 P. 2d 1203 (Or S.Ct 1999).