Marital Property verse Non Marital Property

Maryland Rule § 8-201(e) defines "marital property" as property, however, titled, acquired by one or both parties during the marriage. Property acquired by gift, inheritance, prior to the marriage or subject to a valid agreement between the parties in not marital property.  Once the Court determines what is and what is not marital property, the Court then determines the value of the property before making a marital award.

In Zanford v. Wiens, 314 Md. 102, 549 A.2d 13 (1988), the Court held that “the critical question is not whether marital property is encumbered by a secured debt; it is whether the debt is traceable to the acquisition of marital property, or whether (put otherwise) the debt’s “economic effect” is to reduce the present value of the marital property” (emphasis added).  See Zanford, 314 Md. at 108 (citing Niroo v. Niroo, 313 Md. 226, 240-41, 545 A.2d 35, 42-43 (1988)).

 It is well established that marital debt reduces the value of the marital property.  Schweizer v. Schweizer, 301 Md. 626, 636-37, 484 A.2d 267, 272-73 (1984); Zanford, 314 Md. at 107-08; Niroo, 313 Md. at 240-41. A “marital debt” is a debt which is directly traceable to the acquisition of marital property, and a “nonmarital debt” is a debt which is not directly traceable to the acquisition of marital property.  Schweizer, 301 Md. at 636-37.  The present value of marital property in the parties’ possession at the time of trial must first be established in order to reduce a marital debt from it.  See Zanford, 314 Md. at 108; Niroo, 313 Md. at 240-41.

Furthermore, Maryland courts have held that marital property cannot have a negative value.  Kline v. Kline, 85 Md.App. 28, 45, 581 A.2d 1300 (1990).  If the marital debt exceeds the value of the marital property acquired as a result of incurring the debt, the result is a zero value for the marital property so acquired…” Id. (citing Green pv. Green, 64 Md.App. 122, 146-47, 494 A.2d 721 (1985)).  Marital debt only reduces the present value of the marital property as it exists and does not create a situation in which a monetary award is made for property with no value.

Qualified Domestic Relations Orders (QDROs)

What is a Qualified Domestic Relations Order or QDRO?

Some marital assets may be transferred to one spouse by another spouse in Maryland via a court order known as a Qualified Domestic Relations Order (QDRO). A QDRO can divide a pension, an ESOP or other retirement account.  A QDRO is a court order which recognizes the rights of the non-participating spouse, an alternative payee, who can receive a portion of, or even all of, a pension or retirement plan belonging to another individual.  

How Does a QDRO Work?

Dividing pension and retirement plans between spouses can get complicated. A qualified domestic relations order facilitates dividing the payout of those plans.  Timing can be extremely important when it comes to preparing and entering the qualified domestic relations order with the court in relation to both a retirement or a divorce.

What is the Purpose of a Qualified Domestic Relations Order?

A QDRO can be utilized for assigning current or future retirement or pension benefits as part of the dissolution of the marriage and division of assets. Any alternate payee may receive just a portion or all of the benefits in their entirety.

It is important to speak with a legal professional should the need for a QDRO arise.  The above statement is not legal advice, no legal relationship is created herein, and the above statement is not meant to take the place of consultation with a licensed attorney.  You should always speak with a licensed attorney before taking any legal action.

CHILD CUSTODY IN MARYLAND

Child Custody

A child custody decree may be issued in both an absolute divorce and a limited divorce. In Maryland, custody and access are determined by looking at the child’s best interests. Some of the factors the court will consider include: 

*Safety and well-being of the child;
*Age, health and gender of the child;
*Desire of natural parents and any agreements established between the parents;
*Fitness, character and reputation of each parent;
*Potential for maintaining natural family relations;
*Length of separation of the parents;
*Material opportunities affecting the well-being of the child;
*Preference of the child, if of suitable age and maturity;
*Geographic proximity of parents to allow for reasonable access;
*Prior voluntary abandonment or surrender;
*Other relevant facts.

If the parents can agree on a custody arrangement, the court will typically honor such an agreement if it is in the child’s best interest and not against public policy.

If the parents are unable to agree on custody, the court will make the decision. It is important to understand that custody and visitation orders can always be modified based upon a material change in circumstances.   

There are two parts to any custody arrangement:

1. Legal custody involves the right to make decisions for the child in regard to education, non-emergency medical care, activities, religion, and other issues impacting the child’s development.

2. Physical custody pertains to spending time with the child.

There are a number of ways the court may rule in a custody cases, including: 

Sole custody

Joint custody: This is broken down into three categories:

            Joint legal custody: Both parents share control of how the child is raised, regardless of who the child lives with. One parent may be awarded tie breaking authority in the event of a disagreement or each parent may have specific areas of decision making authority.

            Shared physical custody: The child spends a minimum of 35% of their time with each parent.

            Combination: In this situation, the parents have a combination of joint legal and shared physical custody.

The above statement is not legal advice and is not meant to take the place of consultation with a licensed attorney.  You should always speak with a licensed attorney before taking any legal action.