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The Equal Division of Jointly Titled Marital Property
© 2004 National Legal Research Group, Inc.
MARYLAND: Brewer v. Brewer, 156 Md. App. 77, 846 A.2d 1 (2004).
Minor inaccuracies in the valuation of certain accounts, whose balances fluctuated regularly, were not reversible error. The court may make a monetary award to divide equitably the parties' interests in jointly titled marital property even after ordering that the property be sold and the proceeds divided equally. Inherited furniture does not transmute into marital property when used in the marital home.
Following the entry of a decree granting the parties a divorce, the trial court granted a monetary award of $175,000 to the wife in addition to making other distributions of marital assets. As a result, the wife received $500,000 of the marital property and the husband received approximately $170,000 of the marital estate, although, after considering the parties' separate assets, the husband still had a net worth of $870,000, while the wife held $518,000 in total assets. Both parties appealed.
As to the grant of the monetary award, the court noted that a three-step process had to be followed before making such an award: First, determine what is marital property; second, value it; and third, after considering the statutory factors, Md. Code Ann., Fam. Law 8-205(b), determine whether to grant the award. It was held that the court had met these requirements. It clearly identified what was marital estate property and explained why it had reached that conclusion as to each item.
As to valuation, the husband's complaint that the trial court had failed to assign a precise value to certain items, such as the parties' accounts, was dismissed. These accounts fluctuated in value with interest-bearing accounts accumulating interest on a daily basis and checking accounts having balances that changed daily. A court is only required to make reasonable efforts to ensure that valuations of marital property approximate the date of divorce. Here, the trial court had notified the parties that the values might be slightly off and no error was present since the accounts were evenly divided.
Finally, as to granting the monetary award, the appellate court first reviewed the husband's complaint that the trial court had erred in considering the proceeds of the marital home. The appeals court framed the issue before it as whether, after the trial court ordered the parties to evenly divide the proceeds from the sale of the marital home, that court could then award a monetary award that was based, in part, on the value of that asset. The appeals court held that it could. Recognizing that a court cannot make an award whose amount exceeds the total amount of the marital property and that, if the spouse to whom the court intends to grant an award already owns any marital property, the award cannot exceed the value of the marital property owned by the other spouse, the appeals court found that no error had been committed. A monetary award is in addition to and not a substitution for a legal division of the property accumulated during the marriage according to title. Further, dividing jointly titled marital property does not preclude the court from considering the value of those proceeds in making a monetary award. To hold that the proceeds from the sale of the home, which was nothing more than a division of that marital property according to title, could not then be considered in making a monetary award would be inconsistent with the purpose of the monetary award to counterbalance any unfairness that may result from the actual distribution of property acquired during the marriage, strictly in accordance with its title.
The husband also contended that the trial court had erred in considering the husband's non-marital property because, as he asserted, a disparity in net worth is not a basis for making a monetary award, which is used only in balancing inequities in marital property. The appellate court disagreed. The governing statutes expressly require a court to consider the value of all property interests of each party in the payment of the monetary award, as well as the economic circumstances of each party at the time the award is made. Md. Code Ann., Fam. Law 8-205(b)(2), (3).
On the wife's cross-appeal, she contended that the trial court had erred in finding that there was no gift of the furniture that the husband had inherited and which was used in the marital home. The appeals court found no error. In Maryland, furniture used for marital purposes is presumed to be jointly owned regardless of whether one spouse used separate funds to purchase the property. The court declined to apply this rule to furniture and household goods that had been inherited by one spouse. Simply using such furniture and household items as they are intended to be used is not enough to create a presumption that the spouse intended to make a gift to the marital unit. A distinction can legitimately be drawn between a spouse purchasing furnishings for household use and inheriting those same goods. Unlike purchased goods, inherited items frequently have a sentimental value that exceeds market worth, but only to the recipient. The wife's argument in this regard would require a spouse who inherits furnishings to keep them in storage or forbid other family members from making any use of them to avoid a judicial determination that they are jointly owned.
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