Judicial practice on division of property

Judicial practice on division of property

In the absence of an agreement between the spouses abroad on the division of property, the distribution of shares is carried out in court at the request of one of the spouses (Family Code of Ukraine).

The issue of dividing property acquired during marriage may arise for spouses not only as a result of divorce. Often, a claim for division of property is filed with the court in the following cases:

• during the marriage for various reasons, for example, one of the spouses wants to donate part of their property to close relatives or pay off their debts;
• the reason for the division of property may also be the termination of family relations between spouses who are married;
• after the dissolution of the marriage;
• in the event of a creditor’s demand for the division of the common property of the spouses in order to foreclose on the share of one of the spouses in the common property of the spouses.

The division of property both during marriage and after divorce can be done by spouses with the consent of the parties. In case of a dispute, the division is carried out in the order at the request of one of the spouses (Family Code of Ukraine).

It is important not to miss the statute of limitations for filing a lawsuit to divide common property. This period is calculated in years and begins from the time when the man discovered that his rights were violated.

The value of common property during division during divorce through the court

The assessment of the value of the property, the division of which is initiated by the spouses or one of them, must be objective and determined at the time of the trial. Often, the participants in the process try to understate or overstate the value of the disputed property.

Example

Zakharov M.M. filed a cassation appeal with the tribunal. In his opinion, the property transferred to him and his wife Zakharova G.K. after the divorce by the decision of the court of first instance was assessed subjectively, as a result of which, after its division, the parts turned out to be unequal. This violated the principle of the Family Code of Ukraine on the equality of shares of spouses in the common property.

The court, having re-examined the case on the cassation appeal of Zakharov N.N., found that the division of property was carried out by the court based on the assessment of Zakharova G.K. As a result, the value of the property transferred to the former spouse Zakharova N.N. was significantly underestimated. Part of the property of Zakharov N.N. was determined based on the market value of similar things. The case was sent for a new consideration and, after conducting a commodity examination, was reviewed.

Thus, when dividing property, the court is guided exclusively by its market value, for the determination of which it is necessary to conduct an appraisal examination, subject to distribution of property, with the exception of property for which:

• common shared ownership is established;
• divided in kind.

Division of property through the court during the divorce of spouses

When applying from the court on the issue of dividing the common property of the spouse, the judge, as a rule, adheres to the principle of equality of shares. Except for cases when a different procedure is established by the spouses themselves by a marriage contract (Family Code of Ukraine). For example, if the wife was engaged in housekeeping, raised children and did not have the opportunity to work, then she also has equal rights with her husband in the distribution of their common property.

There are a number of cases when, in the course of identifying various circumstances in court, the particles are not divided equally:

• the court’s decision to increase the spouse’s share may be influenced by the fact that minor children will live with this spouse;
• the share of a man who was wasteful in the family, did not work without objective reasons, did not run a household may be reduced by court order;
• the share of one of the spouses may be increased by court order if the man did not work and did not bring money to the family for valid reasons. For example, due to illness.

In any case, there must be significant reasons for which the court increases or decreases the spouses’ share in the common property.

Law on the division of property of spouses through the court during divorce

In case of concluding a marriage contract, the ratio of shares can be any (Family Code of Ukraine). But it should be taken into account that the terms of the marriage contract can be recognized as null and void if they turn out to be extremely unfavorable for the spouses (Family Code of Ukraine).

Example

Zaitseva O.V. filed a claim with the court, in which she asked to terminate the marriage contract concluded between her and her former spouse Zaitsev P.V., since the contract distributed shares in their common property, which consisted of a residential building and a land plot, in an extremely unfavorable way for her.

During the consideration, the court discovered that the marriage contract assigned 4/5 of the share of their common property to Zaitsev P.V., and 1/5 to the plaintiff. The court considered this distribution of shares to be extremely unfavorable for Zaitseva A.V. and decided to satisfy the plaintiff’s demands.

Division of debts during division of property of spouses through the court

As is known, rights give rise to obligations, therefore, having property rights, spouses also have different obligations.

As a rule, the common debts of spouses and rights of claim are distributed by the court between the spouses in proportion to the shares awarded to them (Family Code of Ukraine).

Obligations may arise between spouses both before and during marriage. They may be common, but may relate only to one of the spouses:

• premarital obligations;
• obligations that arose during marriage, but which the husband entered into while managing his own property, not joint property;
• obligations that are inextricably linked to the individual, for example, compensation for harm caused to life and health (tort), alimony obligations.

For all the above obligations, the man is liable exclusively with his personal property. If personal property is not enough to fully pay off the debts, creditors have the right to demand that the debtor’s share in the common property be allocated for foreclosure (Civil Code of Ukraine).

What debts are divided during the division of property during a divorce in court?

Joint obligations of spouses are recognized as debts incurred during the marriage. These include:

• common obligations or debts, in which the debtor is only one person, but they arose in the interests of the family (improving housing conditions, supporting children, purchasing household appliances, repairs, etc.);
• tortious obligations, when spouses committed actions that caused harm to third parties;
• obligations arising from unjust enrichment;
• obligations for which spouses are jointly liable, for example, payment of utility bills.

For common debts or obligations, spouses are liable with their common property, proportionally to the shares awarded to them. However, there are often cases when the common property is not enough to pay off the debts, then each spouse is jointly liable with his or her property.

There are often situations when spouses have debt obligations that stretch over a long period of time. These can be loans for the purchase of any items, car loans, mortgages. If the debt or loan was taken before marriage, then the spouse who took it is obliged to repay it. The second man is not responsible for these debts.

Judicial practice of dividing debts during divorce of spouses

Loans incurred after marriage will be obligated to be repaid by both parties, regardless of who entered into the loan agreement, if it is proven in court that the loan money was used in the interests of the family.

Expenses in the interests of the family may include repairs in a shared apartment or the purchase of household appliances. It should be noted that debts acquired during marriage are distributed between the spouses in proportion to their shares.

In the case where a loan was taken to meet exclusively the personal needs of a spouse, for example, the purchase of personal items, improvement of personal or inherited property, responsibility for its repayment arises only for the man in whose name the loan is issued.

Currently, car loans have become quite widespread. It should be noted that if a loan is taken to purchase a car or other indivisible property, then the debt is recognized for the man in whose name this property is registered. And the second man has the right to demand compensation for his share in the property purchased on credit in court. As for the remainder of the debt, it is distributed in accordance with the shares.

Весьма актуальным в настоящее время вопрос о распределении долгов и имущественных прав на недвижимость, возникших по ипотечным обязательствам. Да, квартира или жилой дом, купленные в ипотеку, делится между супругами поровну. В данном случае не имеет значения, с кем из супругов заключен кредитный договор. Ипотечный кредит, супруги должны будут погашать пропорционально присужденным им долям. Иногда кредитные организации выражают несогласие получить обеспеченную залогом квартиру в долевой собственности. Но в судебной практике данный факт не оказывает существенного влияния на решения по делу. Важно определить, что суду не важно, выступал ли другой супруг поручителем при оформлении ипотеки или нет.

Payment of compensation for the division of property between spouses through the court

Quite often there are cases when, during the division of joint property, one of the parties expresses a desire to retain the right to the property in full, and to award the other party compensation equal to its share. Most often, such situations arise during the division of real estate or indivisible things.

Property in common shared ownership may be divided between co-owners by agreement between them (Civil Code of Ukraine). Thus, determining the share in common ownership does not always mean the actual division of property in kind; payment of monetary compensation by one of the parties is permissible.

This principle may be violated if we are talking about the division between the owners of a thing that cannot be divided in kind. If the court finds that one of the spouses has a significant interest in the ownership and use of an indivisible thing, then such a thing may be transferred to his personal ownership by a court decision, regardless of the size of the share of the spouses with whom it is transferred. The other spouse must be paid compensation – the value of his share.

Division of real estate during division of property of spouses through the court

When paying compensation, the court is always guided by the market value of the property at the time of the case, for the determination of which an appraisal examination is carried out. Thus, when determining the value of a private house, the prices are taken into account for:

• building materials;
• amounts spent on paying builders and workers;
• costs of delivering building materials;
• loading and unloading work corresponding to the rates of the given locality during the period of consideration of the dispute.

Deposits made in the name of children by spouses do not relate to their common property, which is not subject to division and is considered to be children’s. Children’s things are also not subject to division and are transferred without compensation to the parents with whom the child lives (Family Code of Ukraine).

Bearing legal costs when dividing property in court

Court costs are the state fee and court costs. The procedure for paying the state fee and its amount are established by Federal Laws on Taxes and Fees.

When applying to the court, spouses must pay a state fee, the amount of which directly depends on the price of the claim they have filed. The price of the claim in the division of property is the property claims of one spouse to the other, which the former declares in court. The price of the claim will correspond to the amount that the man intends to receive when he applies to the court with a claim for the division of property.

For example, if the common, jointly acquired property of the spouses consists of an apartment worth and a plot of land worth, then the price of the claim will be equal to rubles.

Usually the price of the claim is set by the man who has filed a claim to the court for division of property, taking into account the cost of such things, independently. However, the judge can change the cost if it is proven that it is too high or too low. If the price of the claim changes, then the fee is subject to change accordingly.

Claim for division of property of spouses during divorce: judicial practice

If the plaintiff (spouse) applies to the court with a claim for division of property and divorce, he/she will be required to pay a state fee for divorce and separately for distribution of property. The amount of the state fee may be reduced in court for low-income citizens.

The state fee is paid before filing the claim. A receipt for payment of the fee is attached to the claim. If the plaintiff has a difficult financial situation, confirmed by relevant certificates and documents, he/she may petition the court to reduce the amount of the state fee.

• If a positive decision is made on the claim, the state fee is returned to the plaintiff and is subject to recovery from the defendant in an amount proportional to the size of the claims satisfied by the court.
• If the plaintiff’s claims were denied, the state fee will go to the relevant budget.

The state fee may be returned if the plaintiff changes his mind about filing a claim or the court leaves the case without consideration. In this case, it is necessary to contact the tax office with an application for a fee refund (the application period is years), to which you must add a certificate from the court stating that the plaintiff did not apply to the court, the original receipt for payment of the state fee.

Answers from a lawyer about the division of property of spouses through the court

Judicial practice of division of property during divorce of spouses

If there is no consent between the spouses when dividing property, the issue is resolved in court, and the following should be taken into account:

1. When distributing property, the court is guided solely by its market value during the consideration of the case, for the determination of which an appraisal examination is carried out.
2. In addition to the rights to common property, spouses are responsible for common debts, which are distributed by the court between the spouses in proportion to the shares awarded to them (Family Code of Ukraine).
3. Determining the share in common property does not always mean the actual division of property in kind; payment of monetary compensation by one of the parties is permissible.
4. The amount of state duty for the division of property is not fixed and depends on the price of the claim, determined by the plaintiff independently.