Numerous decisions must be made when parties divorce. Often, one of the more contentious determinations is property division between the spouses. Each may feel that they are entitled to certain assets, but a court must decide what is fair under the circumstances.
NBA player Dwyane Wade recently reached a settlement agreement in the divorce case with his ex-wife, which has been ongoing for six years. Pursuant to the agreement, Wade will pay his ex-wife a lump sum of $5 million dollars, in addition to her being granted their former home, a mansion, and four vehicles. His ex-wife has refuted that she agreed to the settlement, but the court felt that she has. She also alleged that Wade has refused to pay her $25,000 per month in spousal support, pursuant to an order of the court. Wade has been granted sole custody of the couple's two sons, and both parties are now subject to an agreement to no longer disparage each other in public.
There are two distinct methods of distributing property amongst spouses in the case of a divorce. A few states use the community property method, in which all property is defined as separate property or community property. Separate property is retained by the spouse that owns the property, while community property is divided evenly between the parties. The remaining majority of states apply the equitable distribution method. Property is still distinguished as separate property and community property under this method, with the separate property still being kept by the spouse who owns it. The community property is then distributed between the parties based on what is equitable, but not necessarily equal, based on the circumstances. So, if one spouse earns significantly more than the other spouse or is awarded property with income potential, the other spouse may be awarded a larger share of the property to make the distribution more equitable.
In the case above, the husband earns millions of dollars playing professional basketball, while the wife has little to no earnings. While she has been awarded $25,000 per month is spousal support, it appeared equitable to the court that she should receive significant awards in the distribution of marital property as well. The wife was thus granted $5 million, plus a home and four vehicles to compensate her for the husband's significantly greater income and assets.
Source: Slam Online, "Dwyane Wade to Pay Ex-Wife $5 Million in Divorce Settlement," July 23, 2013
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