Dividing Property in Colorado Divorces, Legal Separations and Dissolutions of Civil Unions: Cutting Property Division Down the Middle (literally?) or Applying Principles of Fairness – northern colorado title

Colorado is not a community property state; instead, Colorado divorces, dissolution of civil unions and legal separations are governed by equitable principles or principles of fairness.  C.R.S. § 14-10-113.  Of course, what’s fair depends entirely on the circumstances of a particular divorce or legal separation.

Where a “community property” state (for example, Louisiana, Arizona, California, Texas, Washington, Idaho, Nevada, New Mexico, and Wisconsin) takes all assets acquired by both parties during the marriage and considers the assets to be the equal property of both parties (i.e. 50/50), Equitable Division states (including Colorado) divides property after consideration of several factors as set forth below.

So, before a party physically cuts any possessions in half (it happened!) and divvies up the equal parts, it’s crucial to understand how the laws of a particular state allocate property between spouses and partners.

The confusion between community property states (also known as equal division states) and equitable division states is understandable.  After all, doesn’t equitable simply mean equal?  It doesn’t.  Equitable means what is just, based not on legal technicalities but on fairness.  So, how does a court look at what is fair under the circumstances of a particular divorce case in Colorado?

Colorado courts are tasked with examining the following factors when dividing property between a couple that is divorcing or separating legally:

(a) The contribution of each spouse to the acquisition of the marital property, including the contribution of a spouse as homemaker;

(b) The value of the property set apart to each spouse;

(c) The economic circumstances of each spouse at the time the division of property is to become effective, including the desirability of awarding the family home or the right to live therein for reasonable periods to the spouse with whom any children reside the majority of the time; and

(d) Any increases or decreases in the value of the separate property of the spouse during the marriage or the depletion of the separate property for marital purposes

In many Colorado divorce and legal separation cases, the parties will exchange marital property spreadsheets or exhibits that attempt to account for the marital (and sometimes non marital) property allocated to each party.  When a worksheet or exhibit shows that one spouse will receive more of the marital assets, the other party, spouse or partner will often reflect an “equalization payment” which aims to equalize the parties by ensuring that each party leaves the relationship with exactly half of the total value of the marital property.  Equalization payments can be cash payments from a liquid asset or perhaps an unequal distribution of a retirement asset such as a 401(k) account or Individual Retirement Account (IRA).  In military divorces, it is popular to divide a Thrift Savings Plan (TSP) or perhaps negotiate a differential in the division of a future military retirement.  An equalization payment, if applied by a Colorado court, begs the (valid) question: If the court applies an equalization payment, isn’t it the same think as dividing property equally in a community property state?

The Colorado Legislature has refused to adopt the community property recognition and allocation of marital property.  After all, circumstances exist where it simply may not be fair or equitable to divide property equally.  Perhaps it makes more sense for a higher earning spouse or partner to be responsible for more of the consumer debt incurred during a marriage or civil union?  Perhaps it makes more sense for the person who keeps the large screen television to keep the credit card balance associated with purchasing the television – despite the fact that the television is no longer anywhere close to the value of the maxed out credit card?  Perhaps it makes more sense to have the younger spouse take on more of the marital debt because the younger spouse probably has an extended earning capacity and can better budget debt payments?  What if a spouse is a business owner and his or her skills were the sole reason for the success of the business during the term of the marriage or civil union?  What if the “stay-at-home” spouse was only taking care of the home and not the children, who were all in daycare or school?  What if the parties made the joint decision for one spouse to contribute more towards a retirement plan with the other party agreeing to work less and take more free time during the marriage or civil union?  Should income of the parties be considered at all in the allocation of assets?

Colorado law clearly provides that a court mush allocate joint property “without regard to marital misconduct.”  However, does that mean that financial infidelity should be ignored or is somehow irrelevant to the division of marital or joint assets?

It’s important to recognize that Colorado is not a community property or equal division state and that the factors for the allocation of separate and marital property in a Colorado divorce, dissolution of a civil union or legal separation is more complex and requires not only factual but also legal arguments based on the various factors and circumstances presented in a particular case.  An experienced and dedicated family law attorney is essential to analyzing your rights and risks with the division of marital property or joint property under Colorado law.

Contact the attorneys and partners at The Drexler Law Group, LLC for more information and to seek the advice you need.  Call (719) 471-8000, visit www.drexlerlawgroup.com or email us at admin@drexlerlawgroup.com to schedule a private and confidential consultation with one of our partners and attorneys.

How Long Do I Have to Wait to Get a Divorce in Colorado? – northern colorado title

In Colorado, at least one spouse or partner in a civil union must be domiciled in Colorado for a minimum of 91 days prior to filing for a divorce.  In addition, the soonest a divorce decree (the actual order of dissolution of marriage) is 91 additional days.  The time requirements are often referred to as a “residency” requirement and a “cooling off” period.

The difference between “domicile” and “residence” is not just semantic.  Think of domicile as your home, the place you call home or intend to reside on a more permanent basis.  A residence, on the other hand, is simply a place where one may reside, live at or occupy even in the short term.  Many factors are analyzed in determining whether a party has been domiciled in Colorado for the requisite period of whether the individual is merely residing in Colorado on a more temporary basis.  It’s easy to imagine the difficulty of analyzing the distinction between domicile and residency in military divorces.  Most military divorces involve PCS or permanent change in station moves across country or even internationally.  A military station assignment in itself does not establish residency or domicile in a particular state.  An attorney experienced in handing military divorces is a key component in an effective legal strategy and the attorney will be able to navigate litigation in the appropriate state.

Rest assured that the overall timeline for obtaining a divorce in Colorado is quite favorable when compared to other states.  Imagine being saddled with the time periods under Arkansas law … 540 days of minimum processing time for a divorce.  If that weren’t enough of an obstacle from dissolving a dysfunctional marriage, that same state requires the parties to be physically separated for 18 months.  Parties in Arkansas ought to think twice before reuniting or cohabitating because any period of cohabitation will require the 18 month separation time requirement to begin again.

The State of Nevada has a rich history of divorce laws and residency requirements.  It turns out that Nevada saw the financial potential in reducing the residency requirement to six weeks (yep, weeks).  The “quickie divorce” was a reality and “divorce ranches” popped up to allow travelers to establish a six-week residence in order to file a petition for dissolution.  The economic benefit came in the form of court and legal fees not to mention the ranch fees, casino income and tourism in general.

Colorado appears to be just slightly better than average in terms of waiting periods and residency or domicile requirements for divorce.

Still, when a divorce involves children, the provisions of the UCCJEA or Uniform Child Custody Jurisdiction and Enforcement Act must be analyzed.  It is entirely possible for a divorcing couple to face litigation in the family courts of two separate states.  The UCCJEA governs the appropriate state in which to litigation child custody disputes.  In those cases in where one party can meet the domicile or residency requirements of one state (e.g. one party has been domiciled in Colorado for at least 91 days) but the requirements of the UCCJEA cannot be established (e.g. the minor children have not been present in Colorado for the last six months – 182 days by statute), the divorcing couple could find themselves at the jurisdictional mercy of two states.  In some cases, it’s good strategy to separate the child custody and divorce-related issues; however, in most cases, the jurisdictional battle could just mean additional legal fees, that could have been avoided by consulting an experience attorney earlier in the process.

If you are facing a time-sensitive divorce issue or find yourself facing a jurisdictional issue in your divorce or child custody case, contact an experienced Colorado Family Law Attorney for straightforward and honest legal advice.

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