During a divorce in Alabama, all marital property is divided “fairly and equitably” between the two spouses.
Marital property refers to property that was brought in by either spouse during the marriage. The property can include savings accounts, retirement accounts or real property like a house. What matters is that the funds or property was acquired during the marriage.
The general rule is that all property that was owned by either spouse prior to the marriage is considered separate property and is not subject to division during divorce.
While that might seem like a pretty straightforward way of defining marital and separate property, it can actually get a lot murkier when complex assets and property are involved. Just take the case of billionaire oilman Harold Hamm.
Hamm is the founder and chairman of one of the world’s most successful oil companies, Continental Resources and is worth $17 billion, according to Forbes. Like Alabama, Hamm’s home state of Oklahoma follows equitable distribution laws, meaning that all marital property is divided “fairly and equitably” but not necessarily equally upon divorce.
But in Hamm’s case, the true sticking point is defining which property is marital. Hamm started Continental before marrying his wife, Sue Ann, which would seem to suggest that the company’s worth belongs entirely to Hamm and not his wife. However, this isn’t necessarily the case thanks to a concept called “appreciation.”
Check back later this week for our discussion on Active and Passive Appreciation as well as more on the Hamm vs. Hamm divorce case, which could go down as one of the most expensive divorces of all time.
Source: Forbes, “A Multi-Billion Dollar Divorce: What All Divorcing Women Can Learn From Sue Ann Hamm,” Jeff Landers, Sept. 22, 2014