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Business Acquired With Inherited Funds
© 2004 National Legal Research Group, Inc.
GEORGIA: Wright v. Wright, 277 Ga. 133, 587 S.E.2d 600 (2003).
A home which the husband brought into the marriage and a business which he started with inherited funds during the marriage were not entirely marital property. The marital interest was limited to any increased value acquired with marital funds or efforts. On the facts, the court did not err by awarding the wife less than one-half of the marital interest.
The parties were married in 1985. Each party brought separate assets to the marriage, including the husband's house, which was subject to a mortgage. In 1991, the husband's mother died and left her estate to him. He used his inheritance to start a family business. After granting a divorce in 2000, the lower court valued and divided the marital estate. The wife appealed, alleging that the trial court erred in not distributing to her a larger share of the assets.
The Georgia Supreme Court affirmed. It held that, in making a distribution of the marital assets, only property acquired as a direct result of the labor and investments of the parties during the marriage was subject to equitable division. Because the husband brought the house to the marriage, only the subsequent increase in the net equity attributable to marital contributions was a marital asset. While the husband started the family business during the marriage, he used his own separate funds (which were derived from the inheritance from his mother) to do so. Therefore, only the appreciation in the value of the business attributable either to the husband's or the wife's individual efforts or their joint efforts was subject to equitable distribution.
As to the wife's argument that the trial court erroneously failed to award her an appropriate share of the marital assets, she having apparently received less than one-half, the court rejected her claim of error, relying on the general principle that equitable distribution does not require an equal distribution. The court looked to all of the relevant factors normally applied in divorce cases, including each party's contribution to the acquisition and maintenance of the property, as well as the purpose and intent of the parties regarding the ownership of the property, factors which were particularly relevant given the circumstances of the case.
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