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Indiana Court of Appeals: Trial Court Errs In Dividing Marital Property
Posted in Litigation

Addressing a couple's marital dissolution case for the second time, the Indiana Court of Appeals again reversed the trial court in Montgomery v. Faust

In 2008, the Indiana Court of Appeals held that the trial court erred when it indicated in a footnote in its final dissolution decree that “due to the short duration of the marriage” it “set off to each” party the “property which they possessed and brought into the marriage and dividing equally only what was acquired during the marriage.”  The Court of Appeals remanded with instructions that all marital property should be put in the marital pot before dividing the assets or value. 

On remand, however, the trial court issued an order saying that it included all assets in the marital pot but that, “due to the short duration of the marriage,” it was “returning” to each party the property he or she brought into the marriage and “thereafter equitably dividing the remaining Assets and Debts on a substantially equal basis.”  The Indiana Court of Appeals found that the trial court abused its discretion on remand.

“Purporting to put all marital assets into the marital pot but then removing certain assets before dividing the rest is equivalent to excluding those assets from the pot in the first place.”  The Court found that requiring the trial court to put all marital assets into the marital pot insures that the trial court first determines the approximate gross value of the marital estate before dividing the property.  “[K]nowing the numerical split of the entire estate might alter the trial court’s view of the appropriateness of its property division.”

The Court further found that the trial court abused its discretion by failing to adequately consider all of the factors listed in Indiana Code § 31-15-7-5 because the trial court’s order suggested that it considered only two of the five factors.  However, the Court upheld the trial court’s denial of the wife’s request for attorneys’ fees, concluding that denial of fees was within the trial court’s discretion.

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