DIVORCE AND MARITAL RESIDENCE

Here the parties were married in 2000; the rest of the facts are set forth below.

Santamaria v Santamaria, 2019 NY Slip Op 08239, Decided on November 13, 2019, Appellate Division, Second Department:

"The defendant contends that the Supreme Court should not have awarded the plaintiff a separate property credit in the sum of $332,000 related to the marital residence. The plaintiff contends that the court should have awarded him sole title to the marital residence, and should not have awarded the defendant 50% of any equity in the marital residence that accrued from 2002 until the date of sale.

"Equitable distribution presents issues of fact to be resolved by the trial court and should not be disturbed on appeal unless shown to be an improvident exercise of discretion" (Loria v Loria, 46 AD3d 768, 769-770). "Equitable distribution does not necessarily mean equal distribution," and requires the court's consideration of all relevant statutory factors (Faello v Faello, 43 AD3d 1102, 1103; see Domestic Relations Law § 236[B][5][d]).

Here, on the record presented, the Supreme Court providently exercised its discretion in awarding the plaintiff a separate property credit of $332,000 related to the marital residence, and awarding the defendant a 50% share of any equity in the residence that accrued from 2002 until the date of its sale. The evidence at trial demonstrated that in 2002, the plaintiff's mother transferred ownership of the subject property, where she resided, to the plaintiff and retained a life estate in the property. In 2010, after the death of plaintiff's mother, the plaintiff transferred ownership of the property to himself and the defendant. At the time, the property was appraised at a value of $332,000. In 2011, after renovations were conducted, the parties and their children moved to the property, and it became the marital residence.

The plaintiff's conveyance of the home in 2010 to himself and the defendant presumptively changed the character of the home from separate property to marital property (see Nidositko v Nidositko, 92 AD3d 653; D'Elia v D'Elia, 14 AD3d 477, 478; Diaco v Diaco, 278 AD2d 358, 359). We agree with the court's determination to award the plaintiff a separate property credit in the amount at which the residence was valued at the time the property was transferred to both parties (see Nidositko v Nidositko, 92 AD3d at 654; Monks v Monks, 134 AD2d 334, 335; Coffey v Coffey, 119 AD2d 620, 622). Furthermore, in light of the evidence that significant marital funds were used over the years to help preserve the plaintiff's separate property asset, the court providently exercised its discretion in awarding the defendant 50% of any equity in the marital residence that accrued from 2002 until the date of its sale."

DIVORCE - DEGREE OF PROOF NEEDED TO PROVE SEPARATE PROPERTY CREDIT

Culen v Culen, 2018 NY Slip Op 00541, Decided on January 31, 2018, Appellate Division, Second Department:

"Furthermore, the defendant's contention that he was entitled to a separate property credit for his contributions to the down payment on the marital residence is without merit. The defendant's self-serving trial testimony that his aunt gave him a check in the sum of $50,000, that his uncle gave him the sum of $10,000, and that he used these funds toward the down payment, was unsupported by documentary evidence, and insufficient to establish his entitlement to a separate property credit (see Rosenberg v Rosenberg, 145 AD3d 1052, 1055; Horn v Horn, 145 AD3d 666, 667; Wasserman v Wasserman, 66 AD3d 880, 883). Additionally, the Supreme Court properly found that the defendant failed to present sufficient evidence tracing the source of any funds used to purchase the martial residence to the sale of certain stock, which was purportedly the defendant's separate property (see Maddaloni v Maddaloni, 142 AD3d 646, 652)."

DIVORCE - THE SEPARATE PROPERTY CREDIT

As a general rule, all property acquired during the marriage is presumed to be marital property but the court can give credits on specific items of marital property which were obtained with separate property funds. So despite the alleged "transmutation", the spouse who contributed separate property to the creation of a marital property should be credited for that contribution...however, the spouse claiming a separate property credit must have proof in order to trace the separate asset and establish the value of the separate asset at the time of the creation of the marital property.

Ahearn v Ahearn 2016 NY Slip Op 01448 Decided on March 2, 2016 Appellate Division, Second Department:

"In June 1996, the plaintiff purchased a house on Salem Street in Patchogue (hereinafter the Salem Street house). Approximately nine months later, the plaintiff and the defendant were married, and they lived together in the Salem Street house. In December 2004, the plaintiff sold the Salem Street house and used the net proceeds of approximately $143,000 from that sale toward the purchase, in March 2005, of a house in Holbrook (hereinafter the Holbrook house). Only the plaintiff's name was on the deed, but, at the time of trial, both parties were listed on the mortgage.

The plaintiff commenced this action for a divorce and ancillary relief in 2011, and the Supreme Court conducted a nonjury trial as to certain issues concerning equitable distribution. As relevant here, in a decision dated October 17, 2013, the court determined that the Salem Street house had remained the plaintiff's separate property until it was sold, and that the Holbrook house was marital property. On the issue of equitable distribution, the court determined that the plaintiff was entitled to a credit insofar as proceeds from the sale of her separate property were used to purchase the Holbrook house only three months later. Accordingly, the court gave the plaintiff a separate property credit of $143,000 in the Holbrook house. A judgment was entered upon the decision, and the defendant appeals, contending primarily that the court erred insofar as it awarded the plaintiff that separate property credit.

Marital property must be equitably distributed (see Domestic Relations Law § 236[B][5][c]), but equitable distribution is not necessarily equal distribution. As this Court has explained, "not all marital property must be distributed in the same manner or in the same percentage, as different equities or different credits may pertain to different assets" (Midy v Midy, [*2]45 AD3d 543, 545; see Arvantides v Arvantides, 64 NY2d 1033, 1034). Here, the Supreme Court correctly determined on the evidence before it that the Salem Street house was the plaintiff's separate property (see Robinson v Robinson, 133 AD3d 1185, 1187; Ceravolo v DeSantis, 125 AD3d 113, 115-116). Moreover, the court did not improvidently exercise its discretion in concluding that the plaintiff was entitled to a separate property credit for any separate property funds she used in the purchase of the Holbrook house. The evidence supports the court's determination that the plaintiff used $143,000 in separate property funds, which derived from the sale of the Salem Street house, in the purchase of the Holbrook house (see Midy v Midy, 45 AD3d at 544-545; Wade v Steinfeld, 15 AD3d 390, 391)."

Just as a side note, this divorce was commenced in 2011 and litigation continued for about 5 years until this decision was issued.