The Nuts and Bolts of an Equitable Distribution Proceeding

In Separation & Divorce by Sarah Hink

When couples separate with the intention of a divorce, one of the big issues that couples must resolve is property. Property division is handled through an equitable distribution in North Carolina, meaning all marital property is split between spouses in an equitable manner. If you are on the verge of a separation, it will be useful to understand the nuts and bolts of an equitable distribution proceeding.

Is An Agreement Possible?

The first scenario in which a couple may divide their property is by agreement. If they executed a prenuptial agreement prior to their marriage, then the terms of that agreement are likely to be legally binding on each spouse. If there are any unresolved issues or unaddressed property, then the couple will need to address this following their separation.

If there is not prenuptial agreement, couples are free to enter into a separation agreement, which is a legally binding contract that may address how property and debt will be classified and distributed between the spouses. These agreements are very common and can dramatically reduce the overall costs of a divorce as the spouses avoid trials on these issues.

However, spouses cannot always reach agreements, at which point it becomes necessary for either spouse to file a lawsuit for equitable distribution.

An Equitable Distribution Proceeding

Either spouse is free to file a lawsuit seeking equitable distribution at any time after their separation, but before their absolute divorce is granted. This can be filed as its own proceeding, or it can be combined with other issues under Chapter 50 of the General Statutes, such as alimony, child custody, and child support. Failure by the parties to assert an equitable distribution claim before absolute divorce is granted waives this relief, meaning you can’t file for equitable distribution after your divorce is granted in most situations.

                  Inventory Affidavits

The first step in an equitable distribution proceeding is preparing dueling inventories for the court. In Wake County, the party who first files the lawsuit has 90 days from the day of service to produce an inventory affidavit that lists “all property claimed by the party to be marital property and all property claimed by the party to be separate property, and the estimated date-of-separation fair market value of each item of marital and separate property.” The party receiving this inventory then has 30 days to produce their own inventory affidavit. The court may extend these deadlines if a spouse provides good cause for seeking an extension, and significantly, the inventories are subject to amendment by the parties. In addition, the court can entertain any motions for temporary orders to prevent spouses from wasting or destroying marital property.

                  Scheduling and Discovery Conference

Within 120 days, the party that filed the suit must scheduled a hearing (or conference) with the court in which the following issues may be addressed: (1) a discovery schedule; (2) the appointment of expert witnesses; (3) a finding on the date of separation; and (4) a deadline by which a pretrial conference must be held.

                  Pretrial Scheduling Conferences

At the initial pretrial conference, the court will check the status of the case, including discovery, whether any issues have been resolved, and whether it is appropriate to order the parties to mediation. The court will also schedule a final pretrial conference.

If the parties are unable to reach an agreement at mediation, then at the final pretrial conference, the court will take the necessary steps to ensure that the case is ready to proceed to trial.

New Direction Family Law

Contact New Direction Family Law if you are separated with the intention of divorcing. It is essential to your financial future and to your custody of your children that you are represented. Our attorneys have years of experience and have successfully helped many clients through their time of need. We take our jobs seriously and want to help you. We provide representation in Wake, Johnston, Durham, and surrounding counties. Contact New Direction Family Law today at (919) 719-3470 to schedule a consultation or reach us online.

Sarah J. Hink
New Direction Family Law

New Direction Family Law
(919) 719-3470