By Eric Solotoff and Sandra Fava
The current economic climate has made divorcing parties more vigilant than ever about the value and disposition of their marital assets. Here are a few methods and concepts that may help divorcing parties streamline the process of dividing their marital personal property—or personalty—during a divorce.
Make Lists and Take Pictures of Your Personal Assets
Having an inventory allows you and your spouse to review the assets available for distribution. Inventories also serve as a way for parties to understand what items you can agree on. Pictures can be used to illustrate whether items have been moved, have gone missing or were inadvertently omitted from a list.
Account for Depreciation
The majority of your possessions have depreciated significantly. Remember to account for that in your internal calculation of who is getting what value. While you may feel you are not receiving as much as you would like from some of your items, provided your “accounting method” is consistent, you do not stand to lose as much as you might fear by accepting that the purchase price is not necessarily the current value.
Agree on What Should Be Appraised
Items of significant value that cannot be agreed upon should be appraised. The main issues to address are what items you and your spouse think need to be appraised, who bears the cost of the appraisal and how an appraiser is chosen. Your attorney can provide insight into how appraisal costs should be divided and provide you with the names of appropriate appraisers.
Create a Valuation Methodology
It is imperative to bear in mind the potential difference in the replacement value of your assets and their actual resale value. When getting something appraised, find out both how much you could sell it for on the day it is appraised and how much replacing it would cost. There are also two common methods to be used when there is disagreement. The first is alternate selection. In this method, the parties literally go asset by asset, taking turns choosing, until all the assets are divided. In the second, one party makes two lists accounting for all of the property, ostensibly of equal value. The other party, however, gets to choose which list they want.
When You Cannot Agree, Use a Neutral Mediator or Arbitrator
Using a neutral third party will save you money, time, and hassle. Rather than both you and your spouse paying your attorneys to listen to you bicker about personalty, choose one party to make decisions regarding the division of assets. Make the arbitrator’s or mediator’s decision binding. This process is generally more expedient and less expensive.
Know Your Motivation
In most cases, there are two primary motivating factors affecting parties’ behavior as they attempt to divide their personality: emotion and economy. Both will play a role, but they cannot be allowed to overwhelm decision-making. Being cognizant of your motivations, even if you cannot control them, will allow you to step back and consider whether fighting about a particular item will help or hurt you in the long run.
For more information on these and other questions regarding divorce in New Jersey, contact Fox Rothschild Family Law attorneys resident in the Morristown office, Eric Solotoff at esolotoff@foxrothschild.com or (973) 994-7501; or Sandra Fava at sfava@foxrothschild.com or (973) 994-7564.
