Saturday, August 4, 2012

Boise Divorce Attorneys - Family Law Lawyers (208) 472-2383

Divorce and Separate Debt
As a Boise Divorce Attorney one of the issues I find to be the most frustrating and difficult for my clients to understand is the concept of reimbursement of separate debt by a member of the community.  While this may sound like typical family law lawyer speak, it is a real issue that takes some analysis to understand.


Separate Funds vs. Community Funds
I have written on many occasions about the differences between separate and community property.  Separate and community funds are a similar concept.  Any funds, monies, that you have from before a marriage is your separate money.  Likewise, income generated from separate property sources are generally separate funds, as is inheritance.  Monies made during a marriage as a result of employment or business and through the sale of community property belongs to the community.

Funds Upon Divorce - Where Does Reimbursement Come From?
If one spouse had separate property at the beginning of marriage and did nothing to co-mingle the property or funds and they use the value of the property or separate funds to benefit the community, they are entitled to reimbursement.  All family law judges and divorce attorneys can tell you that the community is required to reimburse the spouse who used their separate funds.  Many divorce clients, however, often see this as an academic exercise.  But, the reason it is important is because Idaho is a community property state and there is a real legal distinction between monies that belong to the community and monies that belong to each other by virtue of being separate property.  The dollar amount owing to the party who used their separate funds is treated just like a debt to the community.  Under Idaho law that person had the right to use their money for their own benefit and they are not required to use it for the community, but if they do, they have a right to reimbursement.


Community Right to Reimbursement for Separate Debt
The scenario works in the converse as well.  When the community pays a separate debt for one of the parties, upon divorce, the community has a right to be reimbursed for its payment of that debt.  This concept also can get convoluted for clients and it can seem to them that their divorce lawyers are speaking gibberish when talking about it.  The important thing here to remember is that it may be difficult to trace payment for separate debt particularly if the marriage is of a long duration and the debt was paid years before.  Most people don't contemplate divorce as a possibility until it becomes apparent that it will happen so there is the idea that it doesn't matter that the community paid for a separate debt.  It is much like saving your receipt.  You never think you are going to have to return something so you don't bother to keep track of it.

Proof of Payment
This leads me to my final thought on the issue of separate and community funds.  As noted above, keeping track of funds can be critical to proving the right to reimbursement.  Whenever you have co-mingling of funds or cross over payments, you run the risk of not being able to prove you are owed monies from the community.  This is an important issue for divorce attorneys and clients alike.  No Idaho Family Law judge will allow you to nickle and dime the other party because the presumption is that all funds and property in a marriage belong to the community.  However, if you can clearly show that you paid a debt of the community from your separate funds or that the community paid for a debt belonging to the other party, you have a right to reimbursement. 

A word of caveat.  You have a right of reimbursement, but you still have to prove that you somehow did not co-mingle the funds or transmute the nature of the property.  Sound like lawyer speak?  Well, sounds like community property law to me.

If you are seeking a divorce and need an experienced divorce attorney, give us a call, (208) 472-2383 and see what we can do for you.

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