Court Explains Classification of Property in Florida Divorces

In Florida divorce actions, what constitutes marital property, and how such assets should be divided is often one of the most contested issues. Generally, separate property remains separate unless the spouse that owns the property comingles assets or otherwise takes action to commute it into marital property. As discussed in a recent Florida divorce action, absent such conduct, separate property will usually remain separate. If you need assistance protecting your rights in a divorce action, it is wise to meet with a Miami divorce attorney promptly.

History of the Case

It is reported that the husband and wife divorced via a final judgment of dissolution entered by the trial court. The husband then appealed the final judgment. At the heart of the dispute are the classification and equitable distribution of assets, specifically related to the husband’s dental practice and the company that owns the building from which the dental practice operated. The trial court initially classified both entities as nonmarital assets, meaning their overall value wouldn’t be divided upon marriage dissolution. The wife contested this classification, however, particularly regarding the enhanced value of asserting that its appreciation during the marriage should be considered a marital asset. The court agreed with the wife, finding that the appreciation of the value of the company was marital property.

Classification of Property in Divorces

On appeal, the court affirmed the final judgment in all aspects but one. The court focused on the equitable distribution concerning the classification of the enhanced value of the company as a marital asset.

The court noted that the trial court had found that while the wife failed to prove an increase in the value of the dental practice, she did establish that the value of the company had increased due to the paydown of the mortgage on the building. The trial court considered this increase as a result of marital funds, making it a marital asset.

The court disagreed, however, pointing out that the funds used to pay down the mortgage did not pass through the husband’s hands personally. Instead, they moved directly from the dental practice to the company, both of which were considered nonmarital assets. The court emphasized that the rent payments from the dental practice to the company were an essential expense of the nonmarital business, and there was no evidence of the husband storing or commingling marital assets in his companies. Consequently, the court reversed the equitable distribution portion of the judgment related to the company’s enhanced value, remanding the case for a redetermination consistent with its opinion. The court, however, affirmed all other aspects of the judgment.

 Confer with a Skilled Miami Attorney

Property division can be a contentious issue in divorce proceedings, and parties will often have to produce substantial evidence to demonstrate the nature of the property in question. If you want to learn more about how you can protect your interests in dissolution proceedings, it is smart to confer with an attorney. The skilled Miami family law lawyers of the Law Offices of Sandy T. Fox, P.A. can inform you of your options and help you to seek a just outcome. You can reach us through our online form or at 800-596-0579 to arrange a meeting.