Are school loans marital debt?
Family court judges are charged with the responsibility of categorizing assets and debts, determining their value, and distributing them in a fair, equitable manner.
That’s how Equitable Distribution works in North Carolina.
And while that may seem rather straightforward or even obvious, such matters can be deceptively complex.
Married couples going through a divorce regularly dispute the value of houses, retirement accounts, and other assets as of the date of separation.
The other side of the coin involves the apportionment of debt, which may include things bank loans, mortgages, and even student loans.
And like real estate and other things of value that may be subject to repayment of a debt, assuming such debt was encumbered during the period of marriage, the Court must consider the “joint benefit” of the degree to the parties.
What is an education worth?
There are some general rules regarding Marital Debt in North Carolina and who bears the Burden of Proof to prove what is marital debt vs. separate (individual) debt.
The NC Divorce Laws, both under the Equitable Distribution statute and appellate court case law require:
- The party alleging debt is “marital” bears the Burden of Proof
- That includes proving the amount of the debt and debt value as of the date of legal separation
- AND that any such debt was undertaken for the joint benefit of the respective parties
There is also a balancing process of sorts.
If the Family Court Judge is to classify debts associated with student loans, there must be evidence the marriage lasted long enough for the parties to the marriage to “substantially enjoy” the benefit of obtaining the degree, which normally would be associated with improved earning capacity.
That may seem a bit nebulous if not downright confusing. Calculations regarding the value of an asset or debt may be relatively straightforward, based on hard numbers on bank statements and student loan records.
Figuring out how that could serve as a future benefit to either or both parties, while subject to the rules of production of evidence, is a bit more discretionary. That’s not unusual. In family court and legal issues involving Equitable Distribution, there are many, many issues left to the sound discretion of the court.
Are gifts Marital Property?
As long as the Court (the District Court Judges) does not abuse her or his discretion in making legal rulings, they will not be overruled. The Appellate Courts will not overturn ED rulings unless the Judge abuses their discretion or otherwise rules inconsistent with their Findings of Fact.
The Judge’s ruling on ED (Equitable Distribution) is followed, unless there is an obvious, clear abuse of discretion – Bill Powers, Charlotte Divorce Lawyer
Reversing the Court’s ruling is an incredibly difficult thing to do. The appellate court would have to find the entry of judgment (the legal ruling) is not supported by reason. It would also have to be shown that the Judge’s decision was not the natural consequence of or the result of a “competent inquiry.”
Otherwise, it would have to be shown that the Judge did not comply with the NC Family Law statutes, thus resulting in an abuse of discretion.
What is considered as part of Equitable Distribution?
There is a three-step process mandated under the Family Law statutes. The Judge is required to:
- Classify
- Value
- Distribute
That applies to both assets and debts of the parties. Classification involves determining who owns what. That means answering the question, “What is a marital asset (or debt) and what is separate property (property owned by the individual people involved)?”
There actually is another type of property to consider, which is referred to as divisible property.
Debt associated with the marriage, which is also known as “marital debt” involves debts that are incurred during the period of the marriage and prior to the date of separation. Such taking on of debt must have been for the “joint benefit” of the spouses.
The moving party (the party trying to prove the debt is “marital”) has the legal duty to prove first the value of the debt at the date of separation and that the debt was incurred for the benefit of both parties, jointly.
Are school loans “Marital Debt?”
Additional education and degrees are not technically property that can be divided. At the same time, loans incurred for education during the period of marriage may be considered marital debt. The court must also consider whether both parties to the marriage are expected to share in the rewards of a degree or education.
Student loans may be deemed marital, even if the funds are not specifically used for education alone. As such, traditional education expenses regarding tuition, books, lab fees, etc., may be deemed marital debt.
Furthermore, student loans used to pay bills, buy groceries, and even pay for the costs of childcare may also be deemed a marital debt. That’s true also for expenses associated with travel and maintenance of the household to the benefit of the marriage overall.
The moving party (the spouse seeking to have debts classified as “marital”) must present evidence regarding the marriage and whether it lasted long enough both parties to “enjoy the benefits of the degree or higher earnings.”
Does it matter whether money is kept is separate accounts?
Maintaining separate bank or savings accounts while married is not necessarily determinative of the debt/asset classification. It is relevant for the court to consider.
Whether the debt or asset is kept in the name of both or even just one of the spouses is not the sole, determinative factor. The Court, in its Findings of Fact and Conclusions of Law, is required to consider in the totality of circumstances the evidence presented.
It frankly can be a complicated process. Figuring out how long means “long enough” to “enjoy the benefits” of education is not necessarily formulaic or an exact science.
If you have questions about this or how the Equitable Distribution laws in North Carolina work, please call NOW: 704-342-4357
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Does NC need new Red Flag Laws?
According to the National Coalition Against Domestic Violence, there are approximately 20,000 daily calls to Domestic Violence (DV) hotlines.
The National Institutes of Health (NIH) reports “gun availability” results in a substantially higher incidence of domestic homicides.
In intimate partner relationships, the abusive partner’s access to a gun increases the chances of murder on women (femicide), making it anywhere to 5x – 8x more likely. When guns are involved, statistics indicate abusers inflict the most damaging and severe forms of domestic abuse.
“Abusers with guns” were substantially more likely of using a gun in the worst-case-scenario abuse incidents, resulting in femicide. At the same time, a victim’s access to a firearm may also tend to reduce the incidence of death, if only slightly. See “Risk Factors for Femicide” by the NIH.
Similarly, the relationship between mental health issues and criminality (history of criminal charges) is remarkable. There is a vast body of scientific literature documenting the very real and very substantial correlation between criminal behavior and mental illness.
- 283,000 prisoners in US jails and prisons were “mentally ill” (per a 1998 study)
- Surveys among prisoners indicate self-reporting of a diagnosed mental health issue or time in a psychiatric facility in 16% of state prisoners, 16% of jail inmates, and 7% of federal prisoners
- The incidence of mental illness is nearly 3x more likely than the general inmate population
At the same time, disorders involving the use of controlled substances are far more likely to result in criminal charges. Patients with drug or alcohol issues have a higher number of arrests over their lifetime than those diagnosed with personality disorders, affective disorders, and schizophrenia.
Indeed, in instances where substance abuse disorders and personality disorders are the primary diagnoses, those patients are 240% more likely to commit violent crimes than patients diagnosed with mental health issues without attendant substance abuse problems.
What is a Red Flag Law?
“Raising a Red Flag” has traditionally been a visible, literal warning-sign. Red flags may indicate danger, immediate peril, or live fire exercises in the military.
As it relates to family law and domestic violence, some states allow petitioners to for file for a Court Order or TRO (which stands for Temporary Restraining Order). They may also be referred to as an Extreme Risk Protection Order (ERPO).
North Carolina authorizes both No Contact Orders (Chapter 50C) and Domestic Violence Protection Orders under Chapter 50B. Domestic lawyers in Charlotte commonly refer to DVPO’s by their shorthand statutory reference: “50B Orders.”
Strictly speaking, NC has not formally adopted Red Flag Laws. Yet, there are protections afforded under the law to remove weapons in certain circumstances.
In the event an Order is issued, the Red Flag Laws generally prohibit the possession and purchase of guns and possibly ammunition.
Recently, Red Flag Laws, which are a type of gun control regulation, have been enacted nationwide with increasing frequency.
Seizures of weapons and gun laws tend to be highly controversial. Progressive-minded advocates for gun control are fans. Proponents of the 2nd Amendment despise them.
Clearly, there is not an absence of opinions on the topic.
The stated purpose of red flag legislation is to allow family members, friends, (even roommates in some instances), and law enforcement, to institute legal proceedings, in the form of lawsuits, complaints, and restraining orders, to remove weapons, by force if necessary.
While the laws vary from state-to-state, proof and testimony are often required, indicating a serious risk of harm.
As to standards of proof, the legal standard in North Carolina for a 50B Order is “by the greater weight of the evidence.” One would assume, as is the case with many civil lawsuits, that same standard would apply.
The serious risk imposed may involve potential “self-harm” (suicide) as well as physical harm and serious bodily injury to others.
North Carolina Gun Laws
NC gun laws, under the Pre-emption Sections of the general statutes, prohibit a firearms registry of any form by a government entity. There are also prohibitions against local ordinances and statutes involving the legal carrying of handguns pursuant to N.C.G.S. § 14-415.23.
Put simply the North Carolina General Assembly has in large measure preempted legislation by local agencies, reserving for itself that discretion and power.
While certain municipalities are granted certain exceptions, especially as it pertains to carrying weapons on government property and/or limitations to the concealed carry permit laws, State law supersedes, if not outright precludes, enhanced gun control laws on the local level.
There are other firearm restrictions under Article 54A of the Felony Firearms Act, which preclude gun possession involving:
- Convicted Felons
- Persons Acquitted of Crimes by Reason of Insanity
- Persons Acquitted of Crimes by Determination in Incapacity to Proceed
- Concealed Carry of Firearms without Lawful Permit
Federal Firearm Laws
- 18 U.S.C.S. 922 (g)(4)
- Prevents Possession of Firearms or Ammunition
- Adjudication as “mentally defective” or
- Committed to a mental institution
- 27 CFR 178.11
- Adjudicated a mental defective
- Danger to Others
- Danger to Self
- Lacks Mental Capacity of Manage Own Affairs
- Finding of Insanity in a Criminal Case / Criminal Charges
- Incompetent to Stand Trial
- Commitment to a mental institution
- Adjudicated a mental defective
NC Domestic Violence Protective Orders
A North Carolina DVPO allows the Court Order removal of weapons both during the temporary 10-day Order pursuant to an Ex Parte Complaint and Motion as well as an Order extending the period of restraint following a hearing on the issue.
That means a validly issued 50B Order may authorize local law enforcement to seize weapons from the Defendant.
Criminal charges are not required, although in instances of physical domestic violence a Criminal Summons or Warrant for Arrest may be simultaneously brought by the victim.
Domestic Violence Lawyers – Powers Law Firm PA
If you are a victim of domestic violence, seek medical attention if you’ve been injured or harmed in any way. There are legal options available to protect both you and your children.
You may also call us for legal advice.
If you’ve been wrongfully accused of DV or have criminal charges associated with assault, battery, communicating threats, or injury to personal property, exercise your right to remain silent and retain experienced legal counsel.
Follow any Conditions of Release or Bond. Do not violate any Court Order. Obey and follow the terms and conditions of the 50B, as directed.
Issues of domestic violence are regularly encountered in Charlotte Family Court.
Complaints and Motions for a DVPO (under Chapter 50B) may be subject to a Chapter 50 action for separation, divorce, and child custody.
We believe it’s imperative to seek legal counsel early on. Understanding your rights under the NC family laws makes for sound, smart decisions – Bill Powers, Charlotte Divorce Lawyer
CALL NOW for legal consultation: 704-342-4357
You may also email Bill Powers confidentially at: Bill@CarolinaAttorneys.com
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