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Equitable Distribution When the Couple’s Main Source of Income Was One Spouse’s Medical Malpractice Settlement


Florida is an equitable distribution state, which means that the court divides the couple’s marital property in a way that is fair to both parties, even though it does not always entail an equal division; it depends on each party’s earning potential and expenses and the value of each party’s separate property, because only marital property is subject to division.  Couples sometimes disagree about whether a certain valuable asset is marital or separate; in fact, preventing these disputes is one of the main purposes of prenuptial agreements.  If the couple does not have a prenup, then all income earned by either party or property acquired in either party’s name during the marriage is marital property.  The exceptions are inherited wealth and settlements and judgments resulting from civil lawsuits such as medical malpractice lawsuits.  These are separate property unless the owner commingles them with marital property, such as by using them to buy a marital residence.  If the classification of marital and separate assets is a point of contention in your divorce case, contact a Palm Beach County divorce lawyer.

The Husband Who Spent His Medical Malpractice Settlement on a Miami Beach Condo

Jose and Maria had modest means when they got married in New York in 1997.  Jose had been disabled since 1995 because of a benign brain tumor, and disability income was his main source of financial support.  Maria’s previous marriage had ended in divorce, and she had previously worked as a seamstress, a housekeeper, and a nursing assistant.  She was in her 40s when she married Jose, and she suffered from knee problems and high blood pressure.  They lived in what the court decision described as a humble apartment until Jose’s medical malpractice lawsuit against the doctors and hospital responsible for the treatment of his brain tumor settled in 2002.

Jose’s settlement was for more than $3 million, and they moved out of New York because Maria wished to move to South Florida to be near her grandchild.  Using the settlement money, Jose bought a Miami Beach condominium valued at $715,000.  In Florida, Jose and Maria lived within their means, even though she did not work for most of that time.  When they divorced in 2006, they disagreed over whether the condo was marital or separate property and about alimony for Maria.  The appeals court decided that the condo was a marital asset since it had been the couple’s marital residence.  It denied Maria’s request for permanent alimony because the parties had been married for only nine years and because Maria was 54 years old and capable of working, albeit only at sedentary jobs.  It remanded the case to the trial court to determine the duration and amount of alimony Maria should receive.

Let Us Help You Today

An improvement in your financial situation does not always mean an improvement in your relationship with your spouse, and a Boca Raton divorce lawyer can help you deal with the fallout.  Contact Schwartz | White for a consultation.



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