It’s a dangerous clause in your divorce decree: “Each party takes the personal property in that party’s possession, free and clear of any claim of the other.” This clause is most often an after-thought, tucked away in the boilerplate, something to tidy-up the divorce after the big items – the pension, the home – are divided. With it, every last piece of personal property (that is, everything but land and what’s connected to it) is accounted for, from the sleeper sofa in the living room to the sleeping bags in the shed. On the eve of trial or the brink of settlement, it is easy to toss in the towel and add this clause just, in the words of one of my clients, “to move on.” After all, it makes little sense to spend $2,500 in attorney fees fighting for $500 in personal property, and no one wants to look like the wacko bickering over Christmas decorations and the pots and pans.
But, if handled correctly, your personal property does not have to be– and should not be -- an after-thought.
First, most items that you acquire during your marriage, what we call your marital property, are dividable when you divorce. (There are exceptions for inheritances, gifts and, in some states, items you and your spouse agree to treat as one’s property, but most items are marital property). It does not matter whether one spouse purchased the item, whether one repaired it, whether it is titled to one’s name, etc. For example, your power tools are marital property, and your spouse could stake a claim to them, even though you purchased them, you used them, and your spouse cannot distinguish the drill from the nail gun. Marital property does not lose its character as marital property simply because one spouse uses the item during the divorce, either. For example, the home furnishings, television, computers, etc., at home are still partly yours even if you move from your home and your spouse uses them.
Why does this matter? Money. Every item of personal property has a value. Granted, individually they may be small ($5 for the plates, $10 for the books). But, combined, they add up! A fully furnished, three bedroom, two bathroom home with a family computer, a washer and dryer set and a tool shed would have, even at garage sale prices, between $3,000 and $5,000 worth of personal property. An equitable share, around one-half, is yours. Now, let’s say when you divorce your spouse will retain your home, and all of the furnishings, but the divorce court orders you to pay $1,500 toward attorney fees or credit cards so that your now ex can make the first mortgage payment. Well, your ex has already retained your share of the personal property – in an amount that could exceed the $1,500 you owe! If you pay, you pay twice: once in cash, once in property. And in today’s economy, who could afford to do that?
Second, personal property creates ambience, marks your lifestyle, makes you you. It is OK to be attached to a set of wine glasses or to insist on keeping a particular painting, to ask for a book your mother gave you or the quilt your grandmother made. Garage sale prices will not do because these items mean more to you than an everyday buyer. Therefore, the law gives them sentimental value. Sentimental value is the intrinsic worth of an item, which the divorce court cannot easily value because the value depends on you, not the market. As a consequence, usually the item is not part of the marital property to divide. Instead, the court will award the item to the spouse requesting it if the award is reasonable. So, if you have your eye on a family heirloom, a particular framed picture, a hand-me-down tool set, or anything else the value of which is “priceless,” be sure to identify it as having sentimental value, and be prepared to explain to your spouse and the court why awarding it to you is reasonable.
Finally, with the right resources, personal property is not difficult or tedious to value.
1. Litigate. Rather than hire an appraiser, send an interrogatory (a question) to your spouse that asks to value your home contents. If you have a value in mind, and you suspect your spouse’s would be lower, send a request to admit (another question) that asks for agreement with your value or, if your spouse cannot agree, state with specificity the believed value and why. These are legal tools that allow you and your spouse to narrow the issues and commit to certain facts (like value) in your case.
2. Negotiate. Take pictures of each room in your home (some things have a funny way of “disappearing” during a divorce), and spend time creating a spreadsheet that itemizes the property and your guesstimated value. You can find comparables online at www.craigslist.com and www.ebay.com. Use your spreadsheet to negotiate which spouse takes what, and be sure to include a sum at the bottom that indicates the value of each spouse’s share (ideally one-half each) to justify your proposed division.
3. Valuate. Do not shy away from an appraiser. If you and your spouse cannot select one, ask the divorce court to appoint one as an expert. Be prepared with names, and do your research, because you may have to pay the costs as the spouse requesting the appraisal. A good appraiser will spend a day or two during non-intrusive hours going through your home, item of property by item of property, and produce an itemized report of each item and its value. These reports are excellent starting points for negotiating who gets what (like the spreadsheet) and are eye-opening (you will be amazed by how much “stuff” you own and how much it is worth).
The alternative is to leave your property with your spouse. Maybe the pots and pans mean little, but the pots and pans and televisions and bedroom sets and books, etc., etc., mean an awful lot – and you could walk away from thousands.