Property Division and Addiction During Divorce

After a very lengthy effort to salvage their marriage, Stacey and Frank* have decided to take the heartbreaking step toward divorce.

Frank has battled alcohol abuse for many years, and while he is currently in active recovery with a 12-step program, a great deal of financial damage has resulted from his addiction.

As the couple works to determine a reasonable division of their assets, they both wonder how Frank’s alcoholism should and will impact what they walk away with after divorce. Stacey wants to be fair, but at the end of the day, she also knows how much Frank’s disease has cost them both emotionally and financially.

Atlanta divorce attorney Pete Chambers understands this from a very personal perspective. Chambers recommends, “While it is always important for couples undergoing divorce to try to be empathetic when addiction plays a role, my job is to protect my client’s best interests. If addiction has negatively impacted the couple’s financial picture, it may be considered in the division of their marital assets.”

However, that is NOT to be interpreted as using a party’s addiction as a weapon against them, especially if they are in active recovery. Rather, financial loss cause by one party’s addictive behavior may be considered in the overall division of remaining assets.

How is Property Divided in Georgia?

Like many states, Georgia law provides for an equitable division of assets. The courts seek to achieve an equitable, or fair, division of marital property in divorce cases. This may not necessarily always mean a 50/50 or equal split of assets.

Equitable division of assets may include all property acquired by one or both spouses during the marriage, no matter how the title is held.

When deciding equitable division, the judge presiding over your case may consider the following factors:

• Financial status of each spouse
• Needs of the family, particularly the custodial parent
• Separate property
• Evidence of any efforts to hide assets by either spouse
• Future needs of each spouse
• Certain conduct which falls under a “fault” ground for divorce
• Evidence of misconduct resulting in a reduction in value of assets by the accused spouse

To determine property division, Georgia requires divorcing couples to classify their assets as marital property versus separate property. In general, marital property are assets acquired, purchased, or saved during the marriage. Property owned by one spouse prior to the marriage, or property that has been inherited by one party or gifted to one party, (excluding gifts between spouses) may be considered as separate property.

Property Division and Addiction During Divorce

When Addiction Leads to Financial Trouble

Financial misconduct is often the primary reason couples impacted by addiction seek divorce.

An addicted spouse may spend excessive funds to purchase their substance of choice run up credit card debt, access home equity or retirement funds, or sell possessions to fund their addiction.

Alcohol and substance abuse may also affect the addict’s ability to work or even cause job loss, jeopardizing the family’s financial security. In some cases, the addiction results in repeated costly in-house treatment and recovery programs that may not be covered by insurance and drain the family’s savings.

How Addiction Divides Assets Differently

How Addiction Divides Assets Differently

When addiction has had an impact on the family’s finances, the court may take that into consideration when dividing marital assets.

The judge presiding over the case may consider any misuse of marital property and award a greater share of the remaining marital estate to the nonaddicted spouse resulting in a reduced share in the property division settlement for the offending spouse.

Debts resulting from the addiction, including credit card debt or a second mortgage, may become the sole responsibility of the addict.

Hidden Assets, Addiction and Divorce

It can happen during any divorce, but when addiction is involved, the spouse battling their disease or in active addiction may try to hide evidence of their financial abuse. This spouse may be all too aware their alcohol or substance abuse has negatively impacted the couple’s financial picture and also try to hide assets and their increased liabilites.

Hidden Assets, Addiction and Divorce

Divorcing spouses in Georgia can protect themselves from asset and debt concealment during divorce by paying close attention to their finances and be on the lookout for warning signs of asset or debt concealment, including:

• Secretive or defensive behavior when asked about financial matters
• Refusing to share passwords or other account information
• Unusual or seemingly unnecessary loans or credit card debt
• Opening multiple bank accounts
• Complaining about unusual financial difficulties
• Expenditures that seem out of proportion with income

What Should You Do Now?

Divorcing spouses dealing with addiction need a full understanding of the impact the disease has had on their financial situation to ensure a satisfactory property settlement.

Our attorneys at Chambers Family Law are highly experienced at handling separation of assets, including high net worth divorces, and frequently bring in financial experts or forensic accountants to compile a complete view and disclosure of the entire marital estate (ensuring the inclusion of all assets).

We work to determine the value of complex financial assets, find any hidden assets, consider all tax consequences, trace and allocate separate property interests, prepare any coverture calculations on assets that partially vest during the marriage and partially vest prior to or post marriage, and ultimately work to achieve a fair final division of our client’s estate.

Our attorneys have personal experience in the challenges addiction presents during divorce and in how alcohol and substance abuse can impact property division.

We are equipped to successfully provide non-judgmental, compassionate assistance.

Speak to a Chambers Family Law attorney right now at 404-795-5090.

*Client’s names changed for privacy