Divorce is a very stressful time; we get that. Most couples are struggling with anger, resentment, sadness, depression and frustration. It can be natural to want to cut your soon-to-be-ex out of their portion of your finances, especially if those assets were yours before you got married. Nothing is more frustrating that having to split something with a person you don’t love anymore, simply because the law says they are allowed to take half of it.
It can feel so unfair. That’s why so many people feel tempted to stash a little something away before the divorce is final. Especially if you are angry with your spouse and want to get back at them by reducing their portion, or if you feel that you worked to earn what you have and should be entitled to keep it. While our family law attorneys completely understand the frustration that can lead to this sentiment, we have to caution you that this is a very bad idea. Very bad, and very illegal.
Michigan is an “equitable distribution” state, which means that a court in Michigan would aim to divide a divorcing couple’s assets as fairly as possible. Each spouse is legally entitled to a portion of their combined assets, but not necessarily half. So how are assets divided? Well, the court usually tries to look at a variety of factors when dividing assets, including how long the marriage lasted and what each spouse contributed. There is in fact a list of at least 9 factors that the judges review before making a decision about how assets will be divided in an Oakland County divorce case.
However, at the beginning of a divorce, attorneys go through what is called “the discovery process.” This is when a couple gathers information about their combined and their separate assets. This includes all relevant financial information like bank statements, account balances, 401K information, retirement plans, trusts, and mutual funds. This, along with information about other assets like properties and vehicles you own, will all be used to provide a complete picture of your financial worth as a couple and individually.
Each party’s attorney then works together with each spouse to create an equitable divide. If the divorce case goes to trial, a family court judge will make the determination. But if you lie about your assets, or try to cover up assets during the discovery process (regardless of how justified you may feel in doing so) you may find yourself losing more than you would have if you’d just been honest to begin with.
Under Michigan law, one party cannot hide assets to the detriment of another during divorce proceedings. This means, it’s against the law to hide assets during a divorce. The court cannot make an equitable property division without a complete picture of each couple’s finances. This means that hiding assets during your divorce process is very likely to get you sanctioned by the judge. Sanctions can include awarding the hidden asset entirely to your spouse. In addition, even after your divorce case is done, in the case of fraud, the case can sometimes be re-opened.
Additionally, a person who refuses to truthfully and timely respond to legal inquiries during the discovery process may be held in contempt of court, and could be subject to penalties and attorney fees. Discovery responses are given under oath. That means that all the information that you provide to your spouse or your spouse’s attorney must be truthful and complete. If you lie, you could be subject to perjury prosecution.
Regardless of how hard you feel that you had to work to earn what you have, or how angry or hurt you may feel, honesty is always the best policy. Take the high road. If you have questions about how your assets would be divided in the event of a divorce, or would like to protect your assets with a prenuptial agreement, contact us today at (248) 479-6200. One of our experienced family law attorneys is standing by to talk to you today.