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Legal Matters: Both spouses not always liable for community property bought during a marriage

Everyone knows you can sue your husband or wife for divorce, but what about other lawsuits? If the marriage ends in divorce, will property acquired by one spouse over the other’s strong objections be part of the marital property to be divided?

Barney Husband wants a fishing cruiser with all the extras. Jenny Wife wants no part of it. Barney finds a boat, falls in love with it and contracts to buy it. Jenny does not sign any papers related to the sale.

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Barney is unable to keep up the payments on his cruiser. Jenny still has her income, but has contributed none of it toward payments on the boat. Can the cruiser sales company go after Jenny for payment because she is Barney’s spouse?

She would be likely to be liable for the debt if the couple lived in a community property state, where property acquired by either spouse during the marriage is considered to belong to both marital partners.

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Maryland is not a community property state. Our state has an equitable distribution law, which means that in the event of a divorce, the court is not required to divide the property equally, but must divide it in a way that the judge finds to be fair.

The fact that Jenny did not sign any papers that gave her an ownership interest in the boat or an obligation to pay the cost means that Jenny owes nothing. If Barney’s creditor attempted to bring Jenny in as a debtor, the court could rely on the general rule that, as a 2004 American Jurisprudence commentary on the rights of husband and wife pointed out, “Under modern law, neither spouse is liable for the individual debts of the other spouse.”

If Barney manages to come up with the money to pay off the cruiser, and the couple later divorces, could the boat be considered marital property and be part of the assets they divide as they divorce?

Maybe. Part of the family law article of the Maryland Code defines “family use personal property” as tangible personal property acquired during the marriage, owned by one or both parties and used primarily for family purposes.

As they divorce, Jenny might argue that she is entitled to a share of ownership of the boat, as it was acquired during the marriage. But if she never went on board, while Barney used it for his own purposes or to take out his fishing buddies, a court might conclude that the boat was not family use personal property and does not qualify as part of the marital property assets the couple will divide.

If Barney wanted to be extra careful — as the boat is a sore point in the marriage — he could ask Jenny to sign an agreement excluding it from marital property. Even if acquired during the marriage, an item can be excluded from the definition of family use personal property “by valid agreement.” If she refuses to sign, Barney still has a good argument that the boat was his alone.

Donna Engle is a retired Westminster attorney. Her Legal Matters column, which provides legal information but not legal advice, appears on the second and fourth Sunday each month in Life & Times. Email her at denglelaw@gmail.com.

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