Colorado Springs divorce lawyers often struggle with explaining the concept of “marital property” to their clients. That’s because so many divorces happen as a result of “marital misconduct”. Colorado is a no-fault state, so even the worst misconduct will rarely affect the distribution of assets, but there is one exception. When one spouse blames the other for the depletion of marital assets at the time of the divorce filing, and Colorado courts rules in their favor, it can become a factor in the division of marital property settlement. This type of misconduct is something known as “economic fault”.
If you find yourself in a situation where your soon-to-be ex-spouse has purposefully depleted marital assets at the time of the dissolution of your marriage, Colorado courts can value the marital assets as of the date of separation, before the property was depleted, but be careful how you define the depletion of assets.
Pursuant to a temporary injunction that goes into effect when you file for divorce, both spouses are still allowed to use marital assets for reasonable and necessary living expenses. Lines can blur easily when the court is asked to determine whether your spouse’s use of these assets was above and beyond what is necessary. Economic fault can only be established when the pattern of spending these assets far exceeds the behavior that was customary before the commencement of a divorce.
The stress of divorce can cause individuals, who are normally level-headed, to make rash decisions about finances without consulting the other spouse, but the consequences of these actions can cause serious issues when it’s time to negotiate a property settlement. Actions taken during this period may be closely scrutinized, especially if they are construed as an intentional depletion of assets, and may result in a reduction in the amount of property the accused spouse receives in a settlement.
If you have concerns about “economic fault” and how it may affect your property settlement in a Colorado divorce, contact a Colorado Springs divorce lawyer for advice.