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Equitable Distribution and Temporary Restraining Orders

In North Carolina, as soon as a married couple begin to live separate and apart, a claim for equitable distribution may be filed and adjudicated. Adjudicated is a word that refers to the process a court undertakes in considering and ruling on a claim.

Equitable distribution in North Carolina is governed by statute—or written law—found in Chapter 50 of the statutes, in N.C. Gen. Stat. § 50-21. Equitable Distribution is known by many who work in the Family Law field simply as “E.D.” E.D. is the process in which separated couples engage to “split up” their net marital estate, including both property and debt acquired or accrued during the marriage.

An E.D. claim does not have to be brought with or as a part of a divorce. Instead, an E.D. claim can be filed “as a separate civil action.” While an E.D. claim does not have to be brought with or as part of a divorce claim, it may be brought “together with any other action brought pursuant to” a divorce proceeding. An E.D. claim can also be raised by a motion made by either party if litigation—or a lawsuit—has already been initiated.

The first step in the E.D. process is identifying and classifying property. The only property that is subject to E.D. is “marital property,” or property that belongs to both the husband and the wife. Usually this property was obtained after the marriage. Property obtained before a marriage is generally considered “separate” property of a spouse and is not subject to E.D. Distinguishing between “marital” and “separate” property can become difficult when, for instance, one spouse buys a car shortly before marriage and both spouses use their money to make payments on and eventually pay off the loan for the car during their marriage. An experienced Family Law attorney can help parties determine whether property is marital or separate, can help negotiate differences of opinion between spouses regarding property, and can assist parties who have the need to litigate their claims in a court of law.

Before or during a contested E.D. claim, one spouse may become concerned that a husband or wife is planning to discard, deplete, sell, or take other unilateral action that may affect the value of property prior to distribution. Distribution of property occurs after a court has determined which property is subject to E.D. and which portions of property or amounts shall go—or be distributed—to each spouse. A concerned spouse may make a motion to the court asking that the other spouse be restrained from discarding, depleting, selling, or taking action which may affect the value of property until an agreement is made between the spouses or until the court makes a final ruling on distribution. In some instances, a restraining order may be entered without the court hearing from the other spouse. Certain conditions must be met, and the concerned spouse must demonstrate that immediate injury or loss of property is imminent and that notice to the spouse of the hearing to consider the restraining order was not practicable under the circumstances.

In many cases in which restraining orders are granted, a court will require the party seeking the restraining order to pay a bond that protects the adverse party against potential losses to be incurred as a result of the restraining order. Those seeking a restraining order to prevent the destruction of marital property are generally not required to pay a bond. However, if a court is convinced to enter a restraining order and later finds out that the person who sought the order “wrongfully enjoined or restrained” the other party, the court may award damages to the spouse against whom the restraining order was issued.

E.D. cases and the actions and negotiations they involve can become extremely complicated, and those who lack experience in such matters may find the laws and rules governing such claims to be difficult to understand. Anyone considering an E.D. case or who thinks he or she may need a restraining order to enjoin a spouse from destroying or selling off marital property should consult with an experienced Family Law attorney.

The attorneys at Arnold & Smith, PLLC are experienced in all kinds of Family Law matters and are eager to assist you with your claims. Please give one of our Family Law attorneys a call today at 704-370-2828 or Contact Us here to set up an appointment.