Remember, you don’t have to navigate this alone. The experienced team at Plog & Stein P.C. is here to help, offering client-focused service and a history of positive results. Call or contact us online to get support today.

KEY TAKEAWAYS:

• No Proof of Wrongdoing — In a Colorado no-fault divorce, neither spouse must prove infidelity, cruelty, or abandonment. You only need to state that the marriage is “irretrievably broken,” simplifying the process and reducing conflict.
• Simpler and Less Stressful — Because fault isn’t argued, couples avoid blame battles and lengthy trials. This makes it easier to maintain civility, especially when children are involved.
• Financial Responsibility — Each spouse typically pays their own attorney fees, though courts can require one to assist if there’s a large financial imbalance. This ensures fairness in access to legal support.

Table of Contents

1. KEY TAKEAWAYS:
2. What Is No-Fault Divorce?
3. At-Fault Divorce: What’s the Difference?
4. What Does No-Fault Divorce Mean for You?
5. Who Pays for a No-Fault Divorce?
   1. Start Your Case Evaluation Here
6. How Long Does a No-Fault Divorce Take?
7. Steps for Starting a No-Fault Divorce
8. Move Forward Confidently with Plog & Stein P.C.

What Is No-Fault Divorce?

A no-fault divorce allows you to file for divorce without proving that your spouse did something wrong. This type of divorce is often more straightforward and less stressful because it avoids arguments over who caused the marriage to end. Instead, you simply need to say that the marriage has broken down beyond repair—this is often called “irreconcilable differences.” Most states, including Colorado, allow no-fault divorces, making it an option for many couples.

In a no-fault divorce, neither spouse has to prove infidelity, abuse, or any other fault. Instead, both people can agree that the marriage just isn’t working, and they’re ready to move on.

At-Fault Divorce: What’s the Difference?

Some divorces are still based on fault, meaning that one spouse claims the other is responsible for ending the marriage. In an at-fault divorce, you might have to provide evidence of wrongdoing like abuse, adultery, or abandonment. Fault-based divorces are usually more complicated and time-consuming since they may involve proving serious accusations in court.

While Colorado is a no-fault divorce state, other states have at-fault divorces, which can impact decisions like alimony and property division. However, if you live in Colorado, proving fault is not a requirement for divorce.

We understand the emotional toll of divorce—our goal is to help you navigate it with dignity and respect. Contact one of our attorneys today. Plog & Stein are ready to stand by your side and help you through this difficult time. Contact Us

What Does No-Fault Divorce Mean for You?

A no-fault divorce can offer a less stressful and quicker process. Without the need to prove fault, there’s usually less fighting and fewer court appearances. This approach helps couples avoid some of the more painful aspects of divorce, especially if they have children and want to keep things as peaceful as possible. It also saves money since no-fault divorces often resolve faster than at-fault ones.

For many, no-fault divorce allows them to move forward with fewer conflicts. This is especially helpful if both spouses are ready to start fresh and leave the marriage behind without arguing over blame.

Who Pays for a No-Fault Divorce?

Many people have a big question: Who pays for a no-fault divorce? Typically, each spouse is responsible for their own legal fees. However, in some cases, one spouse may ask the court to have the other spouse cover their costs. This request might happen if there’s a large income gap between spouses or one spouse can’t afford the fees independently. The judge will decide if this request is reasonable based on the financial situation of both spouses.

Since Colorado follows no-fault divorce laws, judges usually avoid assigning blame, even when deciding who pays for legal fees. However, consulting knowledgeable lawyers like the Plog & Stein team can help you understand your options and ensure a fair outcome.

Start Your Case Evaluation Here

How Long Does a No-Fault Divorce Take?

The length of a no-fault divorce can vary depending on the complexity of the situation. In Colorado, a no-fault divorce has a minimum waiting period of 90 days from the time the divorce is filed until it can be finalized. This waiting period allows both parties to consider their decisions and potentially reach agreements on child custody, support, and property division.

If you and your spouse can agree on the major aspects of your divorce, the process might be quicker. However, if there are disagreements that require more time to settle, it could take several months longer. Working with an experienced attorney like our team at Plog & Stein P.C. can make a big difference, as we can help guide you through each step and work to keep things moving smoothly.

Steps for Starting a No-Fault Divorce

If you think a no-fault divorce might be right for you, here’s a quick three-step guide to get started:

• Consult an attorney. Talking to a family law attorney should be your first step. They can explain the specific rules that apply not only in Colorado but also to your specific situation and answer any questions you may have.
• File for divorce. After your consultation, your attorney can help you file the necessary paperwork with the court. In Colorado, the paperwork typically includes a petition for dissolution of marriage.
• Agree on terms. Work with your spouse to agree on major issues like custody, property division, and support. An experienced lawyer can assist with negotiations to help both sides reach a fair agreement.

By following these steps, you can confidently start your no-fault divorce and avoid some of the common stresses.

Move Forward Confidently with Plog & Stein P.C.

If you’re facing a no-fault divorce in Colorado, let the skilled attorneys at Plog & Stein P.C. guide you through this emotionally draining and challenging time. With over 50 years of combined experience, we provide personalized strategies to help you make informed decisions. Our team offers competitive rates and unbundled services tailored to your needs. Contact us today online or by phone to set up a consultation, and let us help you navigate your divorce with confidence and care.

What is considered marital property in Colorado? Today, we will attempt to answer that question and address how these laws may impact you.

Table of Contents

1. What Is Considered Marital Property in Colorado?
   1. Exceptions to Marital Property
2. Marital Property vs. Separate Property: What Is the Difference?
3. What Is the Impact of Property Commingling on Division?
4. How Is Property Divided in a Divorce in Colorado?
5. How Do Prenuptial and Postnuptial Agreements Affect Marital Property?
   1. Does the Court Consider Debts to Be Marital Property Under Colorado Marital Property Law?
   2. What Role Do Retirement Accounts Play in the Property Division?
6. How Can You Protect Your Separate Property?
7. Experience the Plog & Stein, P.C. Difference

What Is Considered Marital Property in Colorado?

In Colorado, marital property includes any assets or debts acquired by either spouse during the marriage, with a few exceptions. Colorado Revised Statutes § 14-10-113 (Colorado marital property law) covers everything from homes and vehicles to retirement accounts, stocks, and household items. The law assumes that most property obtained during the marriage belongs to both parties equally, regardless of who purchased it or whose name is on the title.

Exceptions to Marital Property

Not everything acquired during marriage is subject to division. Some exceptions include:

• Gifts or inheritances given explicitly to one spouse,
• Property owned before marriage that was never commingled with marital assets, and
• Settlements from personal injury lawsuits, unless compensation is for loss of income.

How you manage your assets during the marriage can impact their classification under the state’s marital property laws. For example, depositing an inheritance from your uncle into a joint bank account could be considered a commingling of assets. Such commingling usually turns otherwise separate property into marital property under certain circumstances. Your lawyer can analyze your situation and advise you on how the court will likely view exceptions.

Marital Property vs. Separate Property: What Is the Difference?

One of the most important aspects of property division is distinguishing between marital property vs. separate property. Separate property includes assets that are not subject to division, such as:

• Property acquired before the marriage that is not commingled, i.e., it is kept separate;
• Gifts or inheritances explicitly designated for one spouse; and
• Items protected by a prenuptial or postnuptial agreement.

So, what exactly falls under marital property? It includes all the assets and debts you’ve accumulated throughout your marriage, regardless of which spouse earned or purchased them. The tricky part comes when separate and marital property become intertwined. Imagine owning a house before the marriage but using marital funds to pay the mortgage or renovate it. The increased value may be considered marital property.

What Is the Impact of Property Commingling on Division?

Commingling occurs when separate property is mixed with marital property, making it difficult to distinguish between the two. Commingling often complicates divorce proceedings because the court must determine what commingled property remains separate. Tracing the original source of the funds or assets can help clarify which portion of the property should be classified as separate.

How Is Property Divided in a Divorce in Colorado?

Colorado follows an equitable distribution model when dividing marital property, meaning property is divided fairly, though not necessarily equally. How is property divided in a divorce in Colorado? Judges look at several factors when dividing assets, including:

• The financial circumstances of each spouse at the time of the divorce;
• Contributions to the marriage, including non-financial ones like child-rearing or homemaking;
• The economic value of property brought into the marriage by either spouse; and
• Any increase or decrease in the value of separate property during the marriage.

Rather than splitting everything 50/50, the court looks at what is fair based on each couple’s circumstances. A judge aims to ensure neither party is disadvantaged after the divorce.

How Do Prenuptial and Postnuptial Agreements Affect Marital Property?

Prenups and postnups give you and your spouse a chance to agree on how your property will be divided if you ever go through a divorce. Such agreements can significantly impact how the court classifies property and divides it during a Colorado divorce. For example, a prenuptial agreement can specify that certain assets, like a family business or inheritance, will remain separate property, even if commingled during the marriage.

Colorado law honors prenuptial and postnuptial agreements (also called separation agreements) as long as the spouses enter into them voluntarily, with full disclosure of assets, and without coercion. If your agreement meets these criteria, it can override standard marital property laws, giving you more control over your assets during a divorce.

Does the Court Consider Debts to Be Marital Property Under Colorado Marital Property Law?

Just as the court can classify assets as marital property, it can also categorize debts in the same way under marital property laws. Any debts incurred during the marriage, such as credit card balances, car loans, or mortgages, are typically considered marital debts, even if only one spouse’s name is on the account. The court divides debts along with the assets, following the same equitable distribution principles.

However, debts incurred before the marriage or after legal separation are usually classified as separate debts for which the individual spouse is solely responsible.

What Role Do Retirement Accounts Play in the Property Division?

Retirement accounts, including 401(k)s, IRAs, and pensions, are often some of a couple’s most significant assets. Any contributions made to these accounts during the marriage are generally considered marital property, regardless of which spouse’s name is on the account.

Colorado law permits the division of retirement accounts through a qualified domestic relations order (QDRO). This order allows one spouse to receive a portion of the other spouse’s retirement benefits without incurring penalties or tax consequences. However, any portion of the retirement account earned before the marriage is typically considered separate property and remains with the original owner.

How Can You Protect Your Separate Property?

To protect your separate property, consider taking the following steps:

• Keep assets separate—avoid commingling your separate property with marital assets;
• Document everything—maintain detailed records of your separate property, including bank statements, deeds, and other important documents; and
• Consider a prenuptial agreement—if you’re entering into a marriage with significant assets, a prenuptial agreement can help protect them during a divorce.

If you’re already married, a postnuptial agreement can still outline how your assets should be divided if your marriage ends.

Experience the Plog & Stein, P.C. Difference

Facing a divorce in Colorado? You deserve experienced legal guidance to protect your rights and assets. At Plog & Stein, P.C., our dedicated family law attorneys have years of experience handling high-stakes divorce cases throughout Colorado. We are recognized for our results, commitment to client satisfaction, and deep understanding of Colorado’s marital property laws.

Whether you need help distinguishing between marital and separate property, negotiating a fair division, or ensuring your financial future, our team is here to support you every step of the way. Contact us today to schedule a consultation and learn how we can help you during this challenging time.

Resources:

• Colo. Rev. Stat. § 14-10-112, link
• Colo. Rev. Stat. § 14-2-309, link
• Is Colorado A Community Property State? Forbes (2023), link
• Commingling. Cornell Law School Legal Information Institute (2021), link

Property division is one of the most complex and emotionally charged issues in a Colorado divorce. Many clients ask what happens when separate property increases in value during marriage. Does that increase remain separate, or does your spouse have a claim to it? In Colorado, the answer depends on multiple factors, including whether the increase was due to market forces or marital effort. Understanding how courts handle these situations is essential if you want to protect your financial interests. If you’re going through a divorce and have questions about property division, contact Plog & Stein, P.C. to schedule a consultation with an experienced Colorado family law attorney: (303) 781-0322

Each spouse in a divorce keeps their separate property, and the court divides the marital property equitably. As simple as this process sounds, it can quickly become a complex issue that leads to contention between divorcing parties, especially if there is an increase in the value of separate property.

When a marriage ends, questions about what grew or changed during the relationship can get complicated—especially around property. It’s more than just numbers; it’s personal. You deserve answers that bring clarity, fairness, and peace of mind. GET HELP HERE

At Plog & Stein P.C., our skilled attorneys focus exclusively on family law. Over the decades, we have represented clients in a myriad of divorce matters, so we can prepare you for what to expect, and we can help you protect your family and your assets.

Table of Contents

1. Dividing Assets in Divorce Court
2. What Is Considered Separate Property in a Marriage?
3. Talk To Compassionate Divorce Lawyers in Denver Now—Your Future Matters
4. What Happens If My Separate Property Increases in Value?
5. How Does the Court Divide Marital Property?
6. How Can I Safeguard My Separate Property in a Divorce?
   1. Enter into a Separation Agreement
   2. Hire an Attorney
7. Speak to Plog & Stein’s Experienced Denver Divorce Attorneys

Dividing Assets in Divorce Court

When they are ready to dissolve a marriage, many couples assume that the court will divide all property and finances in half and send each divorced party on their way. An automatic 50/50 split is not the law in Colorado. In Colorado, the court must determine what property is marital property and then divide the marital property equitably (i.e., fairly) while allowing each spouse to keep all of their separate property.

What Is Considered Separate Property in a Marriage?

So, what is separate property? Colorado’s divorce law defines separate property as the following:

• Property a spouse acquires before getting married;
• Property a spouse obtains by gift, will, or inheritance;
• Property a spouse receives in exchange for other separate property;
• Property a spouse obtains after there is a decree of legal separation; and
• Property excluded by a valid agreement between the divorcing spouses.

As you can see, there are many circumstances in which a divorce court should not be dividing your assets. But separate property under many of these categories can become marital property, depending on how it increased in value over time and how you and your spouse handle the property.

Talk To Compassionate Divorce Lawyers in Denver Now—Your Future Matters

What Happens If My Separate Property Increases in Value?

Assets you obtain before and after your wedding rarely maintain the same value over the life of a marriage. And the change in an asset’s value can transform your separate property into marital property. If you owned property before marriage, received a gift or inheritance, or made an exchange of one separate property for another that increased value during the marriage, that appreciation in value generally becomes marital property subject to equitable division upon divorce.

Because the value of assets can fluctuate up and down multiple times each year, calculating the difference in the value of a property can be difficult. Our attorneys understand the appropriate methods to use to determine whether your separate property truly increased in value during your marriage, and we can help safeguard your finances during divorce proceedings.

How Does the Court Divide Marital Property?

Colorado divorce courts divide marital property according to what is equitable. Equitable division in a divorce means that the courts seek to divide marital assets fairly instead of equally. When determining what is fair, the courts consider the following:

• The contributions each spouse made to acquire the marital property (including homemaking);
• The value of each spouse’s separate property;
• The ways in which the value of each spouse’s separate property has changed; and
• The economic circumstances of each spouse (including housing needs for the parent who will take care of the children a majority of the time).

The courts do not divide assets according to fault. The court allocates assets only according to each spouse’s needs and circumstances.

How Can I Safeguard My Separate Property in a Divorce?

The end of a marriage can be a painful, tumultuous, and precarious time. If you can take steps to make the divorce process more predictable and easier to manage, you should. Taking the following actions when you are contemplating divorce can help you immensely.

Enter into a Separation Agreement

If you and your spouse do not want to leave the fate of your finances up to chance with the divorce court, you can enter a separation agreement. Your separation agreement can address the division of property, maintenance, support, and parental responsibilities.

The court can make its own decisions about your parental rights, but if financial provisions in your separation agreement are conscionable (meaning fair), the court will generally adopt those terms in its divorce decree. You want to make sure that your separation agreement is detailed and addresses all financial matters. The more detailed and exhaustive your agreement is, the less room a family law judge has to make unfavorable, independent decisions about allocating your assets.

Hire an Attorney

The best step you can take to safeguard your family unit, your peace of mind, and your assets during a marriage dissolution is to hire a skilled attorney. Plog & Stein’s experienced family law attorneys can navigate the intricacies of Colorado divorce laws for you and help ensure that you are treated fairly in dissolution proceedings. We can also negotiate separation agreements and divorce settlements that are comprehensive and just.

Speak to Plog & Stein’s Experienced Denver Divorce Attorneys

Plog & Stein has been providing the Denver metro area with exceptional family law advice and advocacy since 1999. Divorce is a very personal process, and our experienced family law attorneys tailor their legal strategies to each client’s unique family law needs. We treat each case with the sensitivity and respect it deserves, and our attorneys keep the lines of communication open with our clients to ensure collaboration and effectiveness.

Whatever type of family law dispute you have in Colorado, we can handle it. And our rates and retainers are reasonable. If you are facing a family law issue, come to us with your concerns and questions. You can call us at (303) 781-0322 or send us a message online to schedule a consultation. We are ready to help.

In my experience, nothing seems to annoy a judge more than being required to allocate who gets the personal property acquired during a marriage – TVs, beds, tables, paintings, etc. Accordingly, most attorneys tell their clients to try figure it out among themselves. When valuing personal property in a divorce, unlike insurance valuations, courts generally use “garage sale” values to determine what tangible personal property is worth, and almost invariably, it’s not worth much. Keep in mind that courts are vested with discretion to divide marital property in a divorce as they deem to be fair.

Thus, when you are paying your attorney $250 – $350 per hour, arguing over who gets the 2 year old flat-screen or the used king-sized bedroom set, the divorcing couple needs to make a cost-benefit determination of whether a fight over a possession is financially worth it, or whether to just take a deep breath and buy a replacement item.

All that said, there are some practical strategies for divorcing parties to use to make the division of household stuff less brain-damaging. For one, consider the kids. Whichever parent has the majority of time, the parties need to consider making the parent who has the majority of time with the kids the one who has most of the kid stuff. If parenting time is equally split, parties should be fair as to what goes where. It’s not rocket science, but, unfortunately in a emotional divorce, sometimes this common sense approach as to splitting the kids stuff gets lost. Even with clothing, parents oftentimes get sideways over kids wearing new clothes to one parent’s house and coming back in dirty sweats. Know that even stupid fights like over who gets what of kid stuff can sway a judge as to bigger issues (like who is a more mature parent and suitable primary caregiver), so don’t fight over the bunk beds, or video game console. Return the clothes the kids come to the house with, make sure the kids have similar items at each house, and show the court that conflicts over stuff, especially when kid stuff is involved, are low on the totem pole.

For items not related to kids, consider the cost-benefit analysis discussed above. Be fair about items you might recognize has nostalgia value to the other party. Know that family heirlooms brought into the marriage by a party most likely belong to that party who brought those heirlooms into the house. Tools or equipment that help the other party earn income should go to the party that uses those tools or equipment. Lawn and yard equipment should go to the party that can use them. Pictures and videos of children should be copied or divided. If there remain items that continue to be problematic, employ a procedure where disputed items are listed and employ a procedure similar to choosing teams for school sports… one party picks an item off the list, the other party gets the next pick, and so on until the list is gone. Sometimes, it is helpful to hire a mediator to help parties get over this final issue.

It can also be helpful if the opposing party over-values our client’s possessions to just “call the bluff” of the other party and offer to sell those items for cash at the other parties’ valuation. This tactic can oftentimes make the other party come off their inflated valuation. Again, stuff is really only worth a small fraction of what was paid for it to purchase it new (the informal estimation is that an item is only worth 10 cents on the dollar for a garage sale value of an item).

Understand that an impatient judge, in a divorce, can and might order stuff sold if the parties can’t figure it out, and that after paying the costs of a yard/estate sale, the return on personal property will be very unsatisfying. Fighting over personal stuff is often just not worth it and, ultimately, the cost of having to replace everything after the court orders a yard sale is going to be much more than perhaps just compromising on the tangible items in your home.

My hope is writing this article is to provide people with some practical things to think about. That being said, if you cannot agree on household items your attorney will certainly be there to fight for you. Just don’t let the cost of that fight outweigh the personal property you are fighting for. Finally, it should be noted that some items such as real artwork or collectibles may have a value worth fighting for. Each case is different and you should discuss your options related to personal property with your divorce attorney.

By: Jessica A. Saldin

In most divorce cases, the parties are either still living together when the case begins or have recently separated. However, it is also not uncommon for parties to have separated several months, or even years, before the divorce case is filed. In my experience that can be for a variety of reasons. In some cases the parties wanted to take time to attempt reconciliation. In others, the parties simply never got around to filing. Furthermore, in some cases one party left and the other party did not want to file because they did not want the divorce to happen. In sum, there may be a variety of other reasons why spouses wait lengthy times to file for divorce. Regardless of the reasons, if the parties do get to the point of filing a divorce case, a common and reasonable question many parties ask is: what, if any, effect could this long period of separation have on the division of marital property and debts? When reading this article, keep in mind that the court has the power to divide all marital property accrued up to the date of the decree.

The only time that marital property and/or debt acquired during a period of separation will be automatically set aside as one party’s separate property or debt is if it was a period of legal separation. Legal separation is a formal legal process, similar to a divorce, and whether it may be the best fit for your situation will be discussed in a future blog post. If you have received a decree of legal separation, property obtained after that point will be considered your separate property. If you are not legally separated, though, and have only physically separated, the answer to the effect such separation has on the property and debt division is not as clear cut.

It is important to be aware of the fact that property acquired during the marriage, even during long periods of physical separation, is considered marital property. Same with debt accrued during that time. Therefore, if you are considering a divorce, it is best to start the process sooner rather than later to get resolution and to avoid property you acquire being considered marital property (to which your spouse could be entitled) and debt your spouse acquires being considered marital (part of which you could get stuck paying).

Simply because an item is marital, though, does not mean it is automatically divided in half. Colorado is an equitable division state. What that means is that, when deciding how to divide marital property, the court needs to divide it in the manner most equitable to the parties, considering a variety of factors set out in C.R.S. 14-10-113. Prior blog posts have discussed equitable division and the factors the court may consider when deciding how to divide marital property and what is equitable. The focus of this post is how those factors, and the equitability consideration, is affected by a period of long-term physical separation.

One of the factors the court can consider in deciding how to divide marital property is the contribution of each spouse to the acquisition of marital property. If two people have been physically separated for a lengthy period of time, each acquiring their own property, paying their own bills, debts, etc., the argument can be made that this factor supports setting aside each party’s property and debts to them as of the date of separation and dividing the values from the date of marriage until the date of separation only. However, there are several other factors that go into the consideration of what is an equitable division of property and debt. These include: the value of the property received by each party and the economic circumstances of each party. Therefore, while the argument can be made that, due to the contribution, each party should receive his/her property and debt as of the date of the separation, there is no guarantee the court will see that as equitable. Furthermore, if the spouses continued to share joint property after the separation, assist each other with bills (such as continuing to contribute to the mortgage, insurance, etc.) that could be enough of an argument for the court to determine the physical separation should not have an effect on how property and debt is allocated. In other words, it will be a case by case analysis by the court and will really be determined on the specific facts of the case.

One other issue to consider is the effect of the physical separation on maintenance (alimony/spousal support requests). Before awarding maintenance to a spouse, the court must first find that the requesting spouse lacks sufficient property to provide for his or her reasonable needs and is unable to support him/herself through appropriate employment. If the spouses have been separated for a lengthy period of time and the spouse now requesting spousal support has been paying all of their own bills and supporting themselves without any assistance from the other spouse, that can be an argument as to why maintenance is not needed. Much like the property and debt division, there is no bright line rule on this issue, or guarantee that the court will agree with the argument, but it is a reasonable argument to make in that situation.

In conclusion, if divorce is coming, why wait? The longer you let things linger, the greater financial risks you may have.

In prior blog posts, we have discussed the duty of financial disclosures in a divorce. Under Colorado Rule of Civil Procedure 16.2 (e), Colorado law not only requires an absolute duty to disclose one’s financial situation, but also how a failure to accurately disclose, whether by non-disclosure or misstated disclosure, allows a court to re-allocate the assets of a marital estate within the 5 years subsequent to the final Decree of Dissolution, once a material omission of disclosure is shown.

The Colorado Court of Appeals has since, recently, taken that a step further. Whereas a spouse, presumably before, had to come to court with proof or knowledge that the other spouse materially misrepresented or omitted disclosure of a material asset, now the Court of Appeals lowers significantly the threshold upon which a spouse can re-open litigation over the division of a marital estate.

In Marriage of Durie, 2017 CA 1295, the court permitted a spouse to reopen a case under C.R.C.P 16.2 (e) based upon “information and belief” that a material omission or misstatement of disclosure occurred, and that by meeting a showing beyond just vague “suspicions and speculations,” that party could additionally seek “discovery” (a procedure authorized by court rule to allow one party to obtain information and documentation from the other party) to attempt to demonstrate that the other party failed in its obligation to provide accurate information.

Specifically, in Durie, a husband and wife hired a joint expert to value husband’s business. As part of that process, husband provided information to the expert for the expert to make that valuation. Ultimately, the expert valued the business at approximately $855,000. A subsequent expert hired by wife valued the business at $920,000. The parties ultimately entered into a Separation Agreement dividing the marital estate with a stipulated value of the business at $878,579

However, less than a year later, husband was able to sell just a portion of the business for $6,900,000, over 850% of what the joint expert valued the business. Furthermore, wife had information that husband may have been negotiating this sale while the divorce and the expert valuation was in process.

The crux of the Durie case was the level of information wife came to court with, arguing to the court that husband had failed in his duty to disclose. Wife’s motion to the court contained allegations based “upon information and belief” that husband had failed in his duty to accurately disclose material information that would impact on the valuation of the business and pointing to the ultimate sale of part of the business for much more than the joint valuation. Husband countered that the existence of an independent joint expert valuation absolved him from any motion alleging he breached his duty of disclosure.

The Court of Appeals disagreed with Husband. The court noted that Rule 16.2 places a duty on both spouses to disclose “all information that is material to the resolution of the case without awaiting inquiry from the other party.” The court further highlighted that a non-disclosing spouse does not even have to intend to deceive the other spouse, and that all that matters is that a non-disclosure or misstatement of assets occurred, without regard to the offending spouse’s intent.

Accordingly, then, “a moving party may make allegations [to re-open a division of a marital estate] based on information and belief… because he or she may not have complete information about the circumstances of an alleged misstatement or omission.” Additionally, upon meeting a showing of credible “information and belief” the party asserting that a non-disclosure occurred will be allowed to engage in the process of “discovery” as to that alleged non-disclosure so as to develop that information for the ultimate determination by a court as to whether a redistribution of the marital property is appropriate.

What the Durie case, and the cases preceding it interpreting C.R.C.P. Rule 16.2 obligating each spouse to make full and complete financial disclosure, is make clear is that a court will not allow a spouse to make an unfair windfall to the detriment of the other spouse. A court will uphold a fair division of a marital estate, while the standard to unsettle a property division agreement or order is now lowered.

By: Sarah T. McCain

When dividing property and debts during your Colorado divorce proceeding, there are a number of factors to consider prior to simply dividing the property equally down the middle. There are a number of articles on this blog addressing what is marital property and what is not. Please review those postings for further information on that issue. In summary, the court is only looking to equitably divide marital property. Property owned prior to marriage can be separated as pre-marital property so long as you meet the burden of showing, through appropriate documentation, that this property was not only pre-marital but that it was not commingled in any fashion with marital property, during your marriage. Remember that the burden of providing that documentation is on the person making the pre-marital or separate property claim. Furthermore, if you are making a claim that the other party’s pre-marital property has increased during your marriage, once again, the burden is on you to ensure that you have the documentation to prove that the other party’s gained value during the marriage.

In determining what is separate property, statutes and case law require you to provide a balance or value at the date of the marriage, or a statement as close to the date of marriage as possible. When you are dividing up property that increases and decreases in value, this can be a frustrating experience. For example, consider the following scenario. You purchase a home prior to marriage; it decreased in value at the time of your marriage, and then increases again in value by the time of your divorce. The court will use the value at the time of the marriage and the value at the time of divorce. The court will not consider the fact that the other party is receiving a significant windfall in equity by marrying at a time when the home has actually decreased in value from the time it was purchased beforehand. This may not seem equitable. However, the case law on this subject does not allow the judge to consider this phenomenon of your home increasing less in equity from the date of purchase than from the date of marriage. This does not mean that the purchase price issue should not be raised. While the court may not take the figures and determine equity from the date of purchase, the concept might lead the court to feel a modicum of empathy towards your situation and rule in your favor in other areas. If a contribution argument is being made and the court is dividing property in a manner differently than fifty-fifty, creating an element of sympathy can be beneficial, with the right judge.

The court is not required to divide property equally between the parties, as Colorado statute requires that the property be divided “equitably.” Thus, there are arguments that can be made to persuade the court to divide the property in a fashion that is not fifty-fifty. One of those arguments is asking the court to consider what each party contributed to the increase in the equity in the marital property. This does not mean that because one party worked while one party stayed home as the homemaker, that the party who worked receives more. The court will not appreciate that argument. When you are making a contribution argument, focus on items such as the amount of separate property contributed to the marital estate or the circumstances surrounding the care and upkeep of a piece of property. While judges don’t like to listen to parties essentially bad mouthing each other on the stand, you can testify about the roles each party played in the upkeep of a home without it becoming too negative. If you focusing on the separate property contributions to the increase in equity, ensure that you have documentation showing your receipt of the separate property, such as probate paperwork, and documentation showing the transfer of those funds to the marital estate. Contribution arguments may also work in situations in which both parties worked, yet only once contributed to the growth of assets and the marital estate.

Contribution is only one factor that the court considers, as there are several other factors which the court is required to review, including, but not limited to, the age, health, and economic circumstances of the parties. If you have a significant marital estate, meeting with a qualified attorney is likely your best option in assessing the division of these assets and keeping some of those them in your pocket.