The distribution of marital property is an incredibly complex matter in equitable distribution states like New Jersey, especially if one spouse unexpectedly receives an asset after the divorce. You may be wondering why this matters, since anything one accrues after a divorce should have nothing to do with one's former spouse. There are, however, properties that were technically accrued, or began to accrue during the course of one's marriage. When the spouse who is waiting for, or working towards that property finally receives it, does the former spouse deserve a share of that asset even after the final judgment of divorce?
This legal loophole was recently examined in the case of Thieme v. Aucoin-Thieme, a post-judgment property dispute that was decided by the New Jersey Supreme Court. In Thieme, the plaintiff (wife) and defendant (husband) lived together for 8 years before marrying. The marriage was brief, but during the period of cohabitation and marriage, the defendant worked long hours and traveled extensively for a company that promised him a substantial bonus if the company sold. Based on this expected deferred compensation, it was agreed by both parties that the plaintiff would quit her job to raise their 8 year old child while the defendant devoted himself to advancing the company.
During the divorce negotiations, the husband advised that the deferred compensation may never happen, and if it did, he did not expect a large payment. He agreed to revisit the issue in the future if need be; three months later, the company was sold. The husband received a hefty sum of $2.5 million as a bonus, and the wife accordingly filed for her share. There was no disputing that she was entitled to a share based on the portion of the bonus that was earned during the marriage. What was not clear was if she was entitled to the portion that were accrued during the cohabitation period.
While New Jersey laws draw a clear line between marriage and cohabitation, and require palimony agreements be put in writing, Thieme was a situation in which both parties admitted the prospect of a big bonus was a significant factor in the personal and financial sacrifices made by the plaintiff during the period of cohabitation. For a number of years, the plaintiff had given up her job and opportunities for furthering her education based on a written agreement for compensation by the defendant's employer, in addition to his continued promise that they would share in the proceeds of the sale. Even the defendant had to admit that the plaintiff did deserve to be rewarded for devoting herself to their child and the running of their household for most of their relationship. While this is a significant ruling for both cohabitating and married couples, post divorce judgments will undoubtedly continue to present legal challenges based on each couple's unique circumstances. For more information about filing for a post-divorce judgment, please speak with the family law attorneys of Villani & DeLuca, P.C.