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The answer to every hypothetical legal question is always the same: the answer depends on knowing all legally relevant facts involved. Only after all legally relevant facts have been properly taken into account can an analysis be conducted and a legal result produced. Family law cases have a virtually endless number of factual possibilities. In the context of property division, spouses end up squabbling over all sorts of different items and assets, and so the facts of cases vary widely. In the case of Nolan v. Nolan (2023), a Maryland judge determined that equity demanded special division of “trustee’s fees” incurred in the court ordered sale of a marital house.
Of all the possible items to quarrel about, many people might suspect that fees of this kind would rarely be at issue; and yet many similar cases are generated by Maryland courts on a consistent basis. Let’s go over this case in detail so we can see the discretionary power of Maryland courts when it comes to property distribution.
Facts of the Case
The spouses in this case were not able to privately settle the division of a marital house, valued at roughly $550,000. Because the parties were unable to privately agree, the court resolved the issue by ordering the sale of the house and division of the proceeds. Because the house was classified as marital property wholly, the court ruled that sale proceeds would be divided in a 50% / 50% fashion, except that trustee fees be absorbed 100% by the wife. Courts are well within their accepted discretionary power to compel the sale of a marital asset such as a house; the wife questioned whether such power extended to the allocation of trustee fees in this specific way.
In September, 2021, the marital house sold for $550,000, but the net proceeds after all taxes, costs and expenses was close to $35,000. The net proceeds were divided equally, but then nearly $5,000 was withheld from the wife to settle the trustee fees. The wife appealed this judgment, arguing that the court had abused its discretion in allocating the trustee fees in such a manner.
Outcome & Discussion
In its opinion, the appellate division set forth its standard of review and preestablished mechanisms for resolving the dispute raised by the wife. The deferential “de novo” standard applies given the particular legal issues involved. The real issue under scrutiny was the true scope of the court’s “equitable powers”: does the court’s authority to ensure equity extend to allocating fees to one party in a court ordered sale of a marital home? In its decision, the appellate division emphasized the fact that the trial court has broad authority when it comes to ensuring equity in property division cases, and that this authority has extended to various types of court actions.
The court considers a wide range of factors when it divides a marital estate; when examining all relevant factors, courts may decide that equity requires a larger share be distributed to one spouse. There might any number of specific reasons as to why an uneven distribution is justified. The appellate division reviewed multiple pieces of case law in its analysis. Ultimately, the appellate division concluded that the trial court could’ve reasonably determined that equity demanded an uneven division, and allocating trustee fees in such a fashion was within the court’s equitable powers.
Contact the Murphy Law Firm for Additional Information
If you would like to learn more about division of property in Maryland law, the principle of equitable distribution, property characterization principles, or another related topic, contact one of the family law attorneys at the Murphy Law Firm today by calling 240-219-5243.
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