Many people undergoing divorce are often overwhelmed, and this is not surprising. Emotional issues as well as the financial uncertainty surrounding divorce can cause a great deal of stress for all involved–and especially children.
Dividing property can be quite emotional as well, and create a great deal of stress. Knowing how the court will look at the property division, however, may relieve some of this stress in simply knowing what will likely happen. Understanding the legal concept known as the “one pot theory” will help in guiding your decisions with regard to divorce and the property settlement.
The “one pot theory” is the presumption by the court that all property and monies received before and during the marriage are marital property. It is the law in Indiana, and is the presumption in most states. The reason for this presumption is for expediency and efficiency. If the court were to examine each and every piece of property to determine whether it should be considered marital property, it would be rather costly and time consuming for the parties involved. While this is the default way that a court will look at your marital estate, courts have broad discretion in including and dividing assets of the marital estate.
Obviously, courts will not include property covered by an antenuptial (“pre-nuptual”) agreement. These agreements are in consideration of marriage, and specifically exclude certain delineated property known at the time marriage is entered into. These agreements, however, cannot exclude property not yet known or foreseeable at the time of the marriage.
Absent an antenuptial agreement, the property will be presumed to be included in the marital estate, and the court will exercise a presumption of an even division of all property included in the marital estate. This is true where the parties cannot agree on a division of property, and where the court is forced to make the determination. Obviously, the court will honor agreements by the parties in nearly all cases, and it is usually beneficial for the parties to do so to avoid time-consuming and costly litigation.
There are exceptions to the “one pot theory”, but it is a longstanding legal doctrine the court will most often employ absent compelling circumstances to the contrary. If property division is an issue in your upcoming or potential divorce, you should hire legal counsel to protect it. The family law attorneys at SFT Lawyers can help.