The Court of Special Appeals Weighs in on the Frozen Embryo Issue

AvatarCasey Florance, Principal

In my last post (Who gets the Frozen Embryos in the Divorce?), I explored how the Court might handle the disputed disposition of frozen embryos upon the divorce of the parents-to-be.

I hypothesized that the Court might view embryos as marital property, and I recommended consulting a lawyer as part of the assisted reproductive process to ensure that a clear and enforceable contract is in place regarding the disposition of any frozen embryos upon divorce or either party’s death. 

The Court of Special Appeals of Maryland has since answered the question I posed, in a reported opinion issued on April 29, 2021.  In Jocelyn P. v. Joshua P. (WL 1684645), the Court held, as a matter of first impression, that frozen embryos should be given special consideration in light of their potential for human life, and in light of the fundamental and coextensive rights of the embryos’ creators to decide “whether to bear or beget a child,” and accordingly the embryos should not be treated simply as property.  The Court also clarified and set forth the process that the trial courts should follow when addressing the disputed disposition of frozen embryos, using a blended contractual/balancing-of-interests approach.

First, trial courts need to consider the parties’ preferences as set forth in any existing agreements. This may include oral agreements between the parties, and would certainly include an express agreement drafted by the parties’ attorneys.

The Court was careful to caution that trial courts should not consider, however, “boilerplate language in third-party form contracts [such as the form contracts that many fertility centers utilize] that lack expression or direction from the progenitors” because such form contracts “will not qualify as an express agreement for this purpose.” This lends further support for my prior recommendation to engage an attorney to draw up a separate agreement with your partner as part of the assisted reproduction process, so that your and your partner’s intentions and desires are clear and will therefore likely be upheld by a court in the event of a later dispute. 

If there is no express agreement regarding the disposition of the frozen embryos, then the trial courts are directed to seek to balance the competing interests of the parties using six different factors, including the intended use of the frozen pre-embryo if preserved, the parties’ original reasons for undergoing IVF, and the potential burden on the party seeking to avoid becoming a genetic parent. 

Further, the Court of Special Appeals has directed that the trial courts should specifically not consider financial or economic distinctions between the parties, the number of existing children, or whether “reasonable alternatives” such as adoption may be available to the party seeking to become a genetic parent.  

Jocelyn P. v. Joshua P. is a lengthy and interesting read for divorce lawyers, and makes clear that this area of dispute is ripe for invasive and costly litigation when parties do not agree.

So how do you avoid this quagmire if you are thinking of using assisted reproductive technology? See a lawyer and have a clear contract in place between you and your partner regarding the disposition of any fertilized embryos. It will cost time and money upfront, but could save you a boatload of both in the future. 

What Does Divorce Mean for Your Vacation Home?

If you own a vacation home, odds are that you consider it a place of serenity and fond memories. When couples separate and divorce is on the horizon, the question is inevitably asked: “What happens to our vacation house?”

First, you and your spouse can always agree on what to do with your vacation home. Examples of the types of agreements you and your spouse could reach are: agreement to sell it and divide the proceeds, one spouse could buy-out the other spouse’s interest and keep the home, or perhaps the home becomes part of a bigger picture estate plan or trust so that children and grandchildren may continue to enjoy it, despite any divorce. You can agree with your spouse about the fate of your vacation home at any time during the divorce process. You don’t have to wait until the divorce is final.

If you and your spouse cannot agree and you have a contested divorce case, your trial will likely be a year or more away. The court will decide what will happen to your vacation home only at the end of the entire process – and the court is limited to two options:

  1. Order the sale of a jointly titled vacation home and the equal division of any sales proceeds; or
  2. If the vacation home is titled only in one spouse’s name, the court cannot transfer title to the other spouse. However, if the home was acquired during the marriage with marital funds, the non-titled spouse has a martial property interest in the home. The court may order the spouse who owns the home to make a monetary award payment to the other spouse in consideration of their interest in the home and as part of the overall equitable distribution of marital property. “Equitable” does not always mean equal – who gets what depends on the courts consideration of a variety factors – some of which include the duration of the marriage, each party’s age, health, financial circumstances, and contributions to the marriage and property, and the circumstances that contributed to the divorce.

If you and your spouse do not agree on what to do with your vacation home, consider that prior to the actual divorce, the court cannot:

  • Force you or your spouse to sell your home;
  • Force you or your spouse to refinance any debt associated with the home;
  • Force your or your spouse to move out of a jointly titled vacation home. The one exception to this is if a party is ordered stay-away from a vacation home being used as one or both parties’ residence incident to a domestic violence protective order;
  • Force you or your spouse to pay the mortgage or carrying costs.

Also, if you and your spouse do not agree on what to do with vacation home, and it is titled in joint name or solely in your spouse’s name, the court cannot transfer it to you.

You and your spouse can enter into an agreement to do something other than what the court can do, which is legally binding and enforceable.

Before filing in court or entering into any divorce related agreement, you should consult with a family law attorney to determine what effect this has on the other issues in your case.

The Court has more options when it comes to what can happen to your primary home in a divorce. For more information about that, see our article, “What does divorce mean for your home?

For more information, contact Heather at hscollier@lerchearly.com and Erin at elkopelman@lerchearly.com.


How to Uncover Your Assets and Financial Situation

Get your Arms Around Your Family Finances

Erin KopelmanErin Kopelman, Principal

One of the most common concerns I hear from my clients is that they do not know their family’s or spouse’s finances. This is more common than you think.  According to some statistics from last year, in 42% of relationships one partner in the relationship handles the finances, and in 46% of marriages the couples have separate bank accounts. This means almost half of married people don’t know their complete financial picture. 

If you don’t know about your family’s finances, and you’re not comfortable asking your spouse or your spouse is non-cooperative, here are eight easy self-help steps you can take to start putting the pieces together. 

  1. Make an inventory of your incomes, assets and debts – just what you know. You can start building from there.
  2. Gather copies of the pay stubs, bank account statements and credit card statements that you can. You can search shared filing cabinets, go online to shared accounts and your individual accounts, or physically to your bank.
  3. Get copies of your income tax returns. Many people don’t know what their spouse earns or where their spouse banks, but they often file joint tax returns. Joint income tax returns will show your combined incomes, and your and your spouse’s interest and dividend income, including the institutions from where it came from, so you will know where you and your spouse bank.  If you don’t have a copy of your income tax returns, you can ask your accountant, or you can request a copy of your tax transcript for several years back online from the IRS at IRs.gov.
  4. Run a credit report on yourself. This will tell you what debts are in your name.
  5. Make an appointment for you, or you and your spouse, with your financial advisor to find out what you have.
  6. Make an appointment for you and your spouse to review or create an estate plan. The first thing most estate attorneys will do is make an inventory of your assets.
  7. See if you can do a Public Records Search on your spouse. A public records search scours the internet for public records that match certain criteria of the individual you are researching and gives you a report of what it finds. There is usually a fee for this. It often shows information about the individual’s court records, social media, addresses and telephone numbers, information from credit bureaus, asset ownership, and business associations.
  8. Open your mail and save everything you get for a full three months. You can just stick it in an envelope or snap a picture of it with your phone. This isn’t helpful if your spouse gets their mail sent to them at their office or electronically. Many of my clients tell me that their spouse always gets the mail. In that case, sign up on the United States Postal Service’s website for Informed Delivery. Informed Delivery is a service that scans and sends you images of the outside of your mail. That way, even if you never tangibly have your mail, you’ll who you and your spouse are receiving mail from.

Getting your arms around your family’s finances is the first step to taking control of your financial future. 

For more information, contact Erin at 301-347-1261 or elkopelman@lerchearly.com.

The Modern Day File Cabinet: When Can You Access Your Spouse’s Electronically Stored Information?

Chris RobertsChris Roberts, Principal

Your spouse is in the shower and his or her phone lights up on the nightstand… a text message from an unknown number. You unlock the phone using the same tried and true six-digit password that has served as security for countless phones, computers, and email accounts. A string of text messages between your spouse and a lover appears. So begins a deep dive into every electronic device and email account you can get your hands on.

What’s a little snooping between spouses, you ask? Depending on what data you accessed and how, you may have violated a Federal statute punishable by incarceration for up to five years and fines of up to $10,000, per violation. That means that if you read three of your spouse’s unopened emails without his or her consent, you’re looking at a potential 15 years in the slammer and $30,000 in fines.

Don’t Access Your Spouse’s E-mails and Text Messages Without Their Consent

Electronically Stored Information, often referred to as ESI, can take many forms. One bright line distinction is whether or not the ESI is “in transit” when it is obtained. Federal law and many state statutes prohibit the interception of electronic communications without the knowledge and consent of at least one party to the communication. This means that you cannot open an unread email sitting in your spouse’s inbox unless they are aware and consent to your doing so.

This same prohibition applies to the interception of text messages, messages on social media, phone calls, or any other type of electronic communication. As a simple rule of thumb, if you have to access the information on any type of electronic device, it is probably illegal to do so.

Not only is it a crime to intercept electronic communications, generally speaking, illegally obtained evidence is not permitted to be used as evidence in court. So that smoking gun you found by rifling through your spouse’s DMs likely will do you no good in a contested hearing.

The Family Computer Is a Different Story

The same prohibitions do not apply to static data no longer in transit, which is stored on the hard drive of a desktop, laptop, or other electronic device.

Whether or not you can make use of static ESI hinges on whether you have legitimate access to the device. If data is protected by a password that only your spouse knows, in most cases you are not permitted to guess your way into the machine or otherwise hack your way into the data.

Think of a computer as a filing cabinet in the marital home. If the filling cabinet is unlocked, you have a key, or everyone in the house knows the key is somewhere in the junk drawer in your kitchen, you clearly have a right to access the files in the cabinet. If only your spouse has the key to the cabinet and it is known to be off-limits, you may not have a right access it.

Similarly, if your spouse has given you the password to a computer or other electronic device, in most cases you can access the data on the device. The same may go for a device protected by a commonly used family password. Not only can you access these devices, you may also rely on the assistance of an expert to obtain or analyze the data. This can include clandestine imaging of the device, which allows you to obtain all of the data on the device, preserving it for later use and analysis. Hard drives or other electronic storage may include financial information, family budgets, account information, estate planning, and a wealth of other information.

Other Considerations Related to ESI

If you have any reason to anticipate a dispute or court litigation with your spouse, you should never destroy data. Litigants have a duty to preserve evidence, and the destruction of evidence, also knowns as spoliation, can result in severe sanctions in a court litigation. This could include a judge dismissing your court filing and requests for relief altogether. It also may paint you as a ‘bad actor’ in the Court’s eyes, which can negatively impact your case in a number of ways.

There are many software programs with allow you to capture data from a device as it is generated, including keystroke logging software and similar programs. Keep in mind that, even though you are not actively monitoring the device, you will be held responsible for whatever the program is doing. These programs may be violating Federal or state law, which means you may be breaking those same laws.

In addition to Federal law related to the collection and use of ESI, each state has its own laws, which may differ from the Federal rules and those in other states. Consideration of efforts to collect or use ESI is heavily reliant on the specific rules and language of the applicable statutes, as well as the specific facts in each case or circumstance involving ESI.

If you have any question about the legality of your efforts to pursue ESI, you should consult with an attorney familiar with the applicable laws in your jurisdiction. In many cases, they may also suggest consultation with a forensic computer expert. Getting this advice and guidance early on may not only keep you out of trouble, but could also enable you to safely and legally capture ESI that could be invaluable later.

Who gets the Frozen Embryos in the Divorce?

AvatarCasey Florance, Principal

Scrolling through the newsfeed on my Facebook page recently brought me to an article about the actress Sofía Vergara’s long legal battle with her former fiancé, Nick Loeb, over the disposition of their frozen embryos.

They had apparently planned to have children – and gone through the beginning stages of the process to do so – but then broke up before any of the embryos were brought to term. At issue in the multiple lawsuits across multiple states was the fiancé’s desire to keep the frozen embryos and bring them to term without Vergara’s consent. Vergara opposed these requests and sought court intervention to stop his unilateral actions.  

Like so many of the issues we deal with in divorce, what is supposed to be an exciting and happy time for a couple can quickly turn into an expensive and protracted dispute if the relationship sours. Compounding the issue here is that technology develops at a much faster pace than our laws do, despite many of our legislators’ best efforts. As a result, if you are considering expanding your family using assisted reproductive technology, you may want to consult with a lawyer as part of the process.  

Most fertility clinics have expansive paperwork that each hopeful parent must complete as part of any assisted reproductive technology process. Included in the many decisions the hopeful parents must make are what should happen to any fertilized embryos following the process. Will the extras be stored? Disposed of? And what should happen to them if one party wants to dispose of them but the other party does not? What about if one party were to pass away? Can the other party keep them and use them as he or she sees fit?

If the hopeful parents have elected to keep the fertilized embryos stored, and then their relationship ends, what happens to the embryos then? And can a court intervene?

What can the Courts do?

In Maryland, the court would not have jurisdiction to make a custody decision regarding frozen embryos. The court can only make custody decisions with regard to a “child” which is defined in multiple places in our Family Law statutes as an “individual under the age of 18” (with some exceptions). Frozen embryos are not children because they have not been born yet so, political/religious stances notwithstanding, a custody action is of no utility.

If the hopeful parents were married when the embryos were created, then the embryos would arguably be considered “marital property” at the time of the divorce – which is defined as property, however titled, acquired by one or both parties during the marriage. If the parties’ contract with the fertility clinic is not clear on the disposition of the embryos upon a divorce, then the court could have the power to determine ownership of the embryos under the marital property statute. Whether the court would actually do it, however, given the ethical and legal ramifications attendant to granting one parent the ability to create a life that the other parent has not consented to, remains to be seen. 

How do you avoid this possible quagmire? See a lawyer and have a clear contract in place between you and your partner regarding the disposition of any fertilized embryos. It will cost time and money upfront, but could save you a boatload of both in the future.

For more information, contact Casey at 301-657-0162 or cwflorance@lerchearly.com.

Just When You Thought It Was Over…

Some Outcomes in a Divorce Are Permanent, While Others Are Designed to Change

Chris RobertsChris Roberts, Principal

Everyone has something to protect in a divorce, and I have yet to meet a client who doesn’t feel relief when the process is over. Many of those clients, however, are surprised when an issue they thought they resolved for good resurfaces later.

In Maryland, the reality is that some issues can never be permanently resolved in an initial divorce proceeding, while others are always resolved in the first case. Stilll others are capable of being resolved in the first go-around by agreement, depending on the terms of the deal.

Property Issues are Resolved, Once and for all, at the Time of Divorce

The Court is expressly authorized to resolve disputes regarding marital property at the time of divorce, but has no authority to do so once the divorce case has concluded and the time for appeals has passed. That means that, if marital property issues are not resolved at the time of divorce, they cannot be resolved later.

It bears noting that there is a distinction between the general notion of property and the term “marital property” which is specifically defined by statute.

Orders Related to Children Are Never Permanent

Child custody and/or visitation issues are never permanently resolved.

In Maryland, the Court is guided by one overarching standard related to children, to which all other legal standards speak – the best interest of the child. At the end of the day, judges are tasked with making decisions that serve children’s best interests. That is not only true when a judge signs an order following a contested custody proceeding, but also when a judge memorializes a private agreement between the parties related to children, which is also generally incorporated into a consent order.

Though a child custody order will conclude the current dispute, the Court retains authority to modify such orders should circumstances require it to serve a child’s best interest. Things change in life, and if those changes impact a child negatively, public policy demands that courts be able to intervene for the sake of the child. The same is true for child support. If there is a material change in a parent’s income, or expenses for a child change significantly, the Court always has jurisdiction to modify an existing child support order.

For Alimony, it Depends

Alimony is typically modifiable, both in amount and duration, if circumstances and justice require a change.

If the Court determines alimony initially, the alimony will always be modifiable, as the law does not authorize the Court to make its alimony determination non-modifiable. In a private agreement, however, parties can agree that alimony be non-modifiable, both as to amount and duration. Parties can also be more creative than the Court in negotiating the terms alimony.

As examples, in a private agreement, alimony can be based on a formula that automatically accounts for a fluctuation in income, and can terminate when an alimony recipient cohabitates with another person and/or upon the arrival of a certain date. A Court is not able to craft such solutions. The language of a private agreement is important in securing the non-modifiability of alimony.

Indefinite Alimony Does NOT Mean Permanent Alimony

Case law tells us that alimony is not intended to be a lifetime pension, so there is no such thing as “permanent” alimony.

The statute provide for “indefinite” alimony, which essentially is an open-ended period of alimony. As mentioned previously, court-ordered alimony is modifiable; however, it may also be terminated if either party dies or marries, or “if the court finds that termination is necessary to avoid a harsh and inequitable result.”

What constitutes harsh and inequitable result? That is the proverbial (and in some cases literal) million dollar question, and it is a judge’s job to determine based on the facts of the case. If you are the would-be payor of alimony, this uncertainty places a premium on having an exit strategy for your alimony obligation. This can be achieved via a negotiated resolution and careful language detailing the specific circumstances when alimony will terminate.

My Spouse and I Have a Verbal Agreement. What is the Quickest Way to Obtain a Divorce in Maryland?

AvatarDonna E. Van Scoy, Principal

The short answer is: it depends.

Obtaining a divorce in a short marriage with no children and few, if any, assets is very different than a long marriage with children and assets. Then there are marriages in between the short marriage and the long marriage with combinations of no children or children and a variety of assets.

A logical first step is to contact a lawyer. While you and your spouse have reached a verbal agreement and are working together, a lawyer cannot represent both parties in Maryland. No matter your level of cooperation and intentions, you and your spouse can easily have conflicts of interests in a divorce. So one or both of you should to consult with a lawyer.

Moving the Process Forward

  1. Be open to the fact that you and your spouse may not have considered every issue that needs to be addressed in your divorce. It is possible that what you agreed to with your spouse will negatively affect your rights. A lawyer will explain the law, review your agreement, and identify any issues. TIP: Do not sign any agreement with your spouse before reviewing with a lawyer.
  2. Both you and your spouse should each meet with a lawyer. While you have the right to obtain your divorce without the assistance of counsel, in my experience that can result in delay and greater expenses than securing legal advice at the beginning of the process. If your spouse does not want a lawyer, you can be the party that moves the divorce along. However, your lawyer will need to recommend to your spouse (in writing) that they obtain counsel. Your lawyer could provide two or three names of other counsel for you to share with your spouse. Then hopefully your spouse will also seek counsel, or at the very least your spouse could review the final agreement with an attorney.
  3. To assist in the evaluation of your case, come prepared to your initial consult. Write down what you believe is your agreement with your spouse. Bring a list of all your assets including current values and any debt associated with the assets. Bring a copy of your current mortgage statement, your last three years of tax returns, your last three paystubs and, if possible, your spouse’s last three paystubs. If there are children consider how you and your spouse will parent your children and what the children’s schedule will be with each parent.
  4. Once you have all the information necessary to propose a settlement to your spouse, a Separation Agreement will need to be drafted. Your spouse (and counsel) will need to review and approve the agreement. If both of you continue to cooperate with each other in the spirit of divorcing as quickly as possible, the Separation Agreement could be completed and executed as soon as your lawyer can draft the agreement and your spouse can review and approve. While it can be longer or shorter, the average completion of an agreement is 30 to 60 days.
  5. The next step is to file a complaint for an uncontested divorce. Your spouse has to be served and has up to 30 days to file an answer. The fastest ground for the divorce is a Mutual Consent. You and your spouse can speed up the answer time up by working to file the complaint and answer at the same time or together.
  6. The court will then schedule an uncontested hearing. The moving party (the one who files) and their lawyer need to be present. The other party (and their lawyer) can also be present. During COVID19 the hearing is being held remotely. While these are uncertain times, the hearing is normally scheduled in four to eight weeks. The divorced is usually finalized in within 14 days.

The information above depends on a settlement being reached and the parties truly working together. Each case is different. Contested cases can take anywhere from a year or two, or more. Again, involving a lawyer once you start considering a divorce will help you have the information you need to manage your divorce as efficiently as possible.

Not All Dollars Are Equal: Which Assets Are Most Valuable in Divorce?

AvatarErik Arena, Principal

One thing is usually certain in the aftermath of a divorce: You’ll experience a reduction in net worth and in standard of living. This is unavoidable as one household becomes two.

But just because it will happen doesn’t mean you can’t take steps to lessen the blow. By choosing wisely and unemotionally when dividing the marital assets with your spouse, you can minimize the reduction in your net worth post-divorce.

Not all Dollars Should be Valued Equally in Divorce

Although all asset transfers between spouses (incident to divorce) are tax-free events, some of those assets may later be subject to sizeable income and/or capital gains taxes that must be paid entirely by the receiving spouse, significantly diminishing their net value. It is imperative that these consequences be known and understood by you and your attorney so that you don’t end up with less than your fair share of the net assets.

Which Assets and/or Dollars are Most Valuable?

Value means many different things to many different people. When dividing assets between spouses, it is important to keep in mind the classes of assets identified below, which vary in net present value. If you and your spouse are trading assets from different classes, adjustments may need to be made to ensure you are not losing fair value.

  1. Cash is king! It is both liquid and not subject to any further taxes. It doesn’t get any better than that!
  • Cash, funds in checking and savings accounts, and the money market portion of any investment accounts.
  • Home sale proceeds. If the family home is sold as part of the divorce, those proceeds are also liquid and not subject to further tax (as any capital gains due will be paid at the time of sale, after application of your combined spousal $500,000 capital gains exclusion).

2. Other assets not subject to any further tax. Generally speaking, the replacement cost for these items exceed their private re-sale value. Retaining those items as part of your divorce will mean less dollars spent by you post-divorce to get yourself situated.

  • Furniture and home furnishings.
  • Automobiles.

3. Assets subject to capital gain but not income taxes. These assets will fluctuate in value and will be subject to capital gain taxes if you need to sell them to generate cash. The order of priority in each case will vary depending upon the tax basis of each asset or holding:

  • Stock and/or mutual fund holdings in investment accounts. These may also throw off interest and/or dividends, which, in some cases, is taxable income to you.
  • The family home. Depending upon the home’s tax basis, you may face a hefty capital gains bill if you assume ownership and then sell it later. Further, at the time of that sale, you’ll only be able to use your own $250,000 capital gains exclusion, as opposed to the combined $500,000 exclusion for spouses.
  • Other real property not used as primary residence. Any capital gains problem is compounded with these properties because there is no applicable capital gains exclusion.
  • Stock options
  • Vested restricted stock
  • Some artwork

4. Assets subject to income tax at the time of exercise or withdrawal. These assets will also fluctuate in value. However, when it comes time to withdraw from them, you’ll be taxed on those withdrawals and/or distributions at your ordinary income tax rate in the year in which you take the distributions. Accordingly, the present value of retirement assets, when compared to cash assets, must be adjusted for both present value (as cash is available to you now, whereas retirement, if drawn early, is subject to an additional 10% penalty tax) and after-tax value.

  • Most employer sponsored retirement plans (note: IMF and World Bank pensions are not taxable)
  • IRAs
  • Certain pension plans
  • Retirement annuities

Each divorce is different and there can be legitimate reasons why assets are divided a certain way. The information above is intended to inform and educate you, so you can use that knowledge to move forward in a strategic fashion.

Are You a Millennial Thinking about Marriage? Here’s What You Should Know about Divorce

Liz EstephanLiz Estephan, Attorney

Millennials are causing a 24% rate in decline in the divorce rate, according to Business Insider.

There are a few reasons for this statistic like waiting longer to get married, establishing careers, and paying off student loan debt. But if you are a millennial and have decided to get married or are thinking about marriage, here’s what you should know about divorce.

Accounts and Assets

If you and your soon-to-be spouse decide not to have any joint accounts, this does not mean that you do not have an interest in his or her account.

Once you are married, at least in the District of Columbia and Maryland, typically any income to either you or your soon-to-be-spouse is considered marital property. You and your spouse should have frank conversations about your financials and disclose any and all accounts to each other.

Upon divorce, marital assets and accounts are equitably divided.  If you do not know your spouse’s accounts and assets and your spouse is not forthright when you are navigating a divorce, you may have to spend more money in discovery to determine all of your spouse’s accounts and assets.

Real Property

Are you and your soon-to-be spouse thinking about buying property in Maryland or the District of Columbia? Perhaps you had better wait until you are married.

When you are married and buy property in either of these two jurisdictions, there is a presumption that you and your soon-to-be spouse will be tenants by the entirety rather than joint tenants or tenants in common. Tenants by the entirety means that each spouse has an undivided interest in the real property and there is a right of survivorship (if one of you were to pass, the survivor would assume ownership of your home). Maryland has a presumption that real property owned by a married couple is held as tenants by entirety.

If you purchase property before you are married, you could either be tenants in common or joint tenants.

Tenants in common means that you and your soon-to-be spouse have an undivided interest in the property, you are joint owner, but you each own a specific share of the property, your shares do not necessarily have to be equal. Tenants in common do not have a right of survivorship. This could become an issue if your soon-to-be spouse has children from a previous relationship or marriage as the children could inherit your soon-to-be spouse’s interest in the property, not you.

Joint tenants means that you and your soon-to-be spouse have an undivided interest in the real property with rights of survivorship. You and your spouse must intend to create a joint tenancy and the deed should reflect a joint tenancy. Maryland has a presumption against joint tenancy.

Non-marital Property

Do you have a trust, inheritance or real property that you received prior to marriage? This type of property is typically considered non-marital property. For example, if you thinking about using an inheritance to put towards a down payment on a home with your soon-to-be spouse, do not lose track of any of the documentation showing where the money originated.

If you divorce, you want to prove to your spouse and potentially a court, that you have a greater interest in the property because of your non-marital contribution. If you have significant premarital assets, you should consider a prenuptial agreement.

Steps To Protect Your Inheritance And Gifts Received From Third Parties

Erin KopelmanErin Kopelman, Principal

Did you know that, if handled correctly, your inheritance and individual gifts from third parties are non-marital property?

Many people received inheritances and gifts from their families during their marriage. In Maryland, property received prior to marriage, by a gift from a third party or inheritance, or directly traceable to such sources is your non-marital property – meaning you keep it and it will not be divided with your spouse in divorce. 

Similarly, in DC, property received prior to marriage, by a gift or inheritance, or property in exchange therefor is your separate property – meaning you keep it and it will not be divided with your spouse in divorce.

The problem that many face is that they co-mingle, or mix, their non-marital or separate funds with marital funds. For example:

  • They deposit non-marital/separate funds into an account with marital money, or
  • In reverse they deposit marital funds into the account holding the gift or inheritance, their spouse deposits money into the account holding the gift or inheritance, they “loan” money to the marriage and pay themselves back with marital funds into the account holding the gift or inheritance, or even title the gift or inheritance in joint name.

If you have property prior to marriage, or receive property by gift or inheritance during the marriage, keep it separate!

If it’s investible assets, I suggest depositing and investing them at a new banking institution where you do not keep any other monies, and whatever you do, do not add to it.  Also, maintain all paperwork showing where the money came from along with monthly or annual statements from the date of your marriage onward in a safe place.

When in doubt, consult a divorce attorney.