Attorneys Dedicated to Family Law

EP #5: Who Gets What? Understanding Marital Assets in Virginia Law with Jenna Hayba, Esq.

• Curran Moher Weis • Episode 5

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Navigating property division during a Virginia divorce can feel like walking through a legal minefield. Who gets the house? How are retirement accounts split? Will you be responsible for your spouse's debts? These questions weigh heavily on anyone facing the end of a marriage.

In this eye-opening conversation with attorney Jenna M. Haba, we demystify the often confusing world of marital property division in Virginia. Jenna draws on her extensive experience in high-asset divorce cases and her background as a judicial law clerk to provide clarity on how courts actually approach these critical financial decisions.

Ready to understand your rights and protect what you've worked for? Visit curranmoher.com to connect with our team of dedicated family law attorneys who can provide the strategic guidance you need during this pivotal life transition.

Jenna Hayba:

Things like inheritances or gifts to one party during the marriage. Those are separate property, even if they're earned or accrued during the marriage. Separate property is generally anything accrued outside of that before the marriage or after the party's last separation. Hybrid property is a mix of the two. It's some feature of an asset that has both a marital component and a separate component.

Intro/Close:

Welcome to attorneys dedicated to family law, the podcast where our experienced attorneys Curran Moher Weis guide you through the complexities of family law, whether you're facing a divorce, custody dispute or financial matters. Our dedicated team is here to provide strategic insight and practical advice. Each episode, one of our attorneys will dive into key legal topics and help you navigate your unique situation with confidence. Let's get started.

Charlie McDermott:

Well, welcome to Attorneys Dedicated to Family Law the podcast where the experienced attorneys Curran Moher Weis guide you through the complexity of family law. Today we're diving into one of the most critical and often most confusing parts of divorce property division. Who gets it or who gets what? What counts as marital property and how can you protect what's yours? Joining me today is Jenna M Hayba Esquire, a respected family law attorney here Curran Moher Weis. Jenna brings a wealth of experience in high-asset divorce cases and is known for her sharp legal mind and thoughtful approach to complex family matters. Before joining the firm, she served as a judicial law clerk, giving her unique insight into how judges approach these issues from the bench. Jenna, thanks for joining us. How?

Jenna Hayba:

are you doing? Thanks for having me. I'm good. How are you?

Charlie McDermott:

Yeah, real good, real good, yeah. And you're taking time out on a Thursday and really appreciate you doing that. And this is information, as I mentioned in the opening, I know can be very confusing. You find that a lot when you're first meeting with clients that you know.

Jenna Hayba:

I guess the beauty of what you bring to the table in the firm is, in most cases, when you're going through a divorce for the first time, it's overwhelming, I would imagine for most yeah, I would say, so, I mean even in the initial consultation, you can really only give the potential client a snippet of the information and as their case goes on, they have more and more questions and there are more and more nuances, especially, you know, with regard to this topic of property division.

Charlie McDermott:

Yeah, yeah. Well, let's get into that. And before we dive into property division, can you briefly or briefly explain why this is often one of the most contentious parts of a divorce case?

Jenna Hayba:

Yeah, I mean, I think it's really contentious because you know, like most people you know spend hours at work. You know they work really hard for their money, they work really hard to save for retirement, they work really hard to provide for their children, and so the idea then that everything they've worked for is, you know, potentially going to their other spouse worked for is, you know, potentially going to their other spouse that's often a hard pill to swallow, it's hard to come to terms with, and what those numbers will look like moving forward for their budget, for their savings plans, their retirement plans, it sort of changes their whole life outlook.

Charlie McDermott:

Yeah, yeah, yeah, I can imagine so in your experience. What are some common misconceptions people have about how assets are divided in Virginia?

Jenna Hayba:

Yeah, so I think there's a couple, I mean, I think a common one is is that because something is titled in their name alone, that it is theirs to keep? And that is not necessarily the case, and this is the best example of this is like a retirement account. Someone thinks, well, my retirement account is only mine, it's only in my name, and it's not necessarily true that they get to keep it solely as their property or that their spouse doesn't have any interest or entitlement to a portion of it. You know, another misconception is that what is going to happen in their divorce is what happened in their neighbor's divorce. That hey, I talked to a friend and they said X, y and Z happened. And a lot of times they think that the law is applied uniformly in every case, but so many cases are very fact specific that that's not the case in most cases.

Charlie McDermott:

Yeah, yeah, and I guess, especially if you're talking to a friend who lives in another state, right, because the law varies from state to state.

Jenna Hayba:

Sure sure, of course. Yeah, I mean from state to state, from situation to situation even from. I talked to my friend who practices criminal law and they said this you know. So there's a lot of that and there's a lot of misconceptions that are built based on you know, misinformation or you know other people's experiences.

Charlie McDermott:

Yeah, yeah. Well, how about the difference between marital property, separate property and hybrid property under Virginia law?

Jenna Hayba:

Yeah, so I mean generally, marital property is the assets that are accrued from the date of marriage through the date of separation. There are some exceptions to that, as with any rule, things like inheritances or gifts to one party during the marriage those are separate property, even if they're earned or accrued during the marriage. Separate property is generally anything accrued outside of that before the marriage or after the party's last separation. Hybrid property is a mix of the two. It's some feature of an asset that has both a marital component and a separate component, an example being a house that was purchased prior to marriage that one party put a down payment towards and then during the marriage maybe it was retitled into joint names and they paid the mortgage with their income earned during the marriage. That house may have both a separate component and a marital component.

Charlie McDermott:

Okay, okay. So then, how do the courts typically approach the process of classifying assets into these categories?

Jenna Hayba:

I would say that courts and family law practitioners, through settlement negotiations, are looking at the timing of receipt of an asset and then also the source of the receipt of the asset. So, for instance, when was this asset acquired? Was it acquired after the parties were married? Was it acquired after their date of separation? And where did it come from? So, something like an inheritance that came from a death of a family member, for example, even if it was acquired during the marriage, because of the source of the funds it might be considered separate property.

Charlie McDermott:

Okay, okay, so Virginia is an equitable distribution state. So what does that mean in practice?

Jenna Hayba:

Right, I mean in practice it. You know it doesn't mean everything's equal, but sometimes it lands that way, but it just doesn't have to. And so in practice that could mean that assets are split 50-50 down the middle for each asset. Or it could mean, you know, one party is going to keep one asset and another is going to keep a different asset because their values are somewhat similar.

Charlie McDermott:

Okay, okay, wow. That cannot be an easy feat. A lot of times, I would imagine that's a challenge.

Jenna Hayba:

No, it's not. And it's a huge risk when people go to trial because you know what is equitable. I mean, a lot of people have different definitions of what that means and the judge is going to have a different definition for what that means. And so you know, while I've litigated cases or settled cases where the parties you know agree on, or the court orders, a 50-50 split of assets for each asset owned, I've also litigated or resolved cases where you know a judge might say you know, spouse A is going to keep the house and spouse B is going to keep, you know, this investment account or all the investment accounts in exchange, because those assets are valued somewhat similarly.

Charlie McDermott:

Okay, okay, yeah. So what kinds of factors, then, can influence the court's decision on how to divide property?

Jenna Hayba:

Yeah, so I mean, the law if we're getting technical has a big list of factors that the court can consider. A lot of those are things like the length of the marriage, the contributions to the marriage from both parties, both non-monetary and monetary, the decisions made during the marriage. Those are just a few of the things that a court could consider.

Charlie McDermott:

Okay. So then, how does the length of the marriage or the conduct of the parties affect the outcome?

Jenna Hayba:

Yeah, so the length of the marriage obviously is going to impact the classification of assets. They simply have more marital assets that are more likely to accrue the longer the marriage is and less separate property claims. It can also sometimes tie into the factor of the contributions during the marriage, because they have a lot more contributions, uh, because they have been in their marriage for a longer period of time, whether those contributions are uh monetary or non-monetary. You know, those are just a couple of the factors that a court can consider and you know, I would say in my experience, uh, so the consideration of those factors, among the others listed in the statute, can skew how a court may divide the assets or to which party they award the assets, if that's an issue in the case.

Charlie McDermott:

Okay, okay. So you talked a little bit about retirement accounts, but how are retirement accounts and pensions typically divided?

Jenna Hayba:

Yeah, so. So retirement accounts we're talking about. You know different kinds of accounts, right? Some are Roth accounts, pre-tax and post-tax accounts. Generally a court and what the law provides in Virginia is that a party can be awarded up to 50% of the marital share of the other party's retirement account, marital share being amount of money accrued in the account from date of marriage through date of separation. So a lot of times we see a court awarding that 50% sometimes less, but up to 50% to the other party. A lot of times that's accomplished by an equalization of the two accounts. You know, if both spouses have retirement accounts, they might offset the values so that there's one transfer between the two of them.

Jenna Hayba:

But pensions are treated a little bit differently because pensions are unique. You know, not a lot of people get pensions anymore. Unique, you know, not a lot of people get pensions anymore, but they are. The court does have the authority to divide them and so we divide them, you know, either in litigation or through settlement negotiations. But they are divided if, as and when received by the other spouse and they're divided using what's called a coverture fraction. It's a little complicated but essentially what it is is it's a calculation of the marital interest up to 50% based on the asset accruing during the marriage and it continuing to accrue after the date of separation.

Jenna Hayba:

Because a lot of people that are entitled to pensions they're not done working. I mean some people are, and then that makes the calculation a little bit simpler and they're already receiving their pension. Or they're not done working. I mean some people are, and then that makes the calculation a little bit simpler and they're already receiving their pension or they're close to retirement. But you know, for a lot of folks, particularly, you know, federal employees, they still have many years to go and so it's a question of will they even get their pension? Will it vest? Is it already vested? And then you know if they do receive that pension vested and then you know if they do receive that pension it has to be divided at some point in the future.

Jenna Hayba:

A lot of people you know come in and they want to do some sort of present value calculation of their pension and while that's possible, the court won't do it because it's never, it can't be accurate, it will never be accurate for an actual determination of how much that pension is going to be worth, because we can't figure out how long that spouse is going to continue working or when they're going to pass away and no longer receive the pension. So there's a lot of facets that go into the division of pensions because they're a little bit complex and they have many components, uh, like survivor benefits and and whether, uh you know, a former spouse would be entitled to those survivor benefits. So it's kind of all case specific, pension specific, you know, job specific, um, and it gets a little complicated, but, um, yeah, it's something we certainly work through in in a lot of cases, especially living in this area with a lot of federal workers.

Charlie McDermott:

Yeah, all right. So that was certainly very complicated. I'll try a little simpler one.

Jenna Hayba:

Thank you, throw me a snowball yeah.

Charlie McDermott:

What happens if one spouse owned a home before the marriage, but the couple lived in it and paid the mortgage together?

Jenna Hayba:

Yeah. So that sort of goes back to the example I gave earlier of an asset that might be hybrid property and might have a separate property component and a marital component, have a separate property component and a marital component. So you know, spouse A purchases this asset before the marriage, we might they might have put their separate funds into the property to put the down payment or paid the mortgage down for a period of time, and so that presumably they're using their separate properties to do those things and that gives them a separate property interest in the house. Now, when they get married, um, you know, maybe they don't.

Jenna Hayba:

There's a lot of different things that could happen. Some people retitle their houses when they refinance, Um, but even if not, um, the house may have some marital interest in it as soon as the party start paying the mortgage during the marriage using marital funds and your income earned during marriage is marital funds. So you know, if you use your income to pay your mortgage, you're contributing marital funds to that property. And that's where we do some all different calculations to try to figure out how much of that property is separate and how much of it is marital.

Charlie McDermott:

Okay, okay, all right. So then, from a debt standpoint, how's that handled, both marital and individual?

Jenna Hayba:

Yeah, so debts sort of follow assets, sort of the same rules. You know, debts accrued during the marriage are marital Debts accrued outside of the marriage, prior to marriage, after the date of separation, considered separate, and that's regardless of titling. So a debt, or, say, a credit card, for example, or a personal loan, is in one party's name, that can be considered marital debt. That, you know, both parties are responsible for in some way. You know, sometimes it depends on the type of debt and what the debt was accrued for. You know, certainly there are arguments that spouses can make about waste. For example, you know someone ran up a bunch of credit card debt gambling or something, some non-marital purpose that might be treated differently, even if it was accrued during the marriage, than, say, a credit card that was used to pay normal living expenses. Um, but, but generally debts follow assets in the same same way that they're divided. Obviously, though, you know, dealing with the, the physical division of an asset may be easier when there's actually money to divide rather than debt that has to be paid.

Charlie McDermott:

All right, so let's get, let's flip over to the protecting financial interest side of the equation here. So for someone entering a divorce, what are some first steps they should take to begin protecting their financial interests?

Jenna Hayba:

yeah, I mean, the first thing I usually tell my clients to do is to establish a brand new bank account, um brand new checking account, um brand new savings account that, once they've established their date of separation, they can divert their paycheck into that new account.

Jenna Hayba:

And because that establishes their new separate property I mean your income you earn during your marriage marital property Once you're separated, it becomes separate, but you have to keep it separate. And so when you start, when you establish a date of separation, and then you start putting your paycheck into a marital account, that's okay, but you might be relinquishing the claim to say that's my separate property. And so usually I tell people establish a new bank account, but that doesn't mean we're not going to pay the bills. We're going to pay the bills, just divert the money back into whatever account the bills need to be paid out of. You know, even let your spouse know that you're doing this, so no one is shocked by, hey, his paycheck or her paycheck didn't hit the account, um, but that's usually, you know, the first step, um, and the biggest, I I think, action that people can take when they first start that path towards divorce.

Charlie McDermott:

Okay, okay, super. So then, jenna, what would you say are some common mistakes people make that end up hurting their financial position during divorce during divorce.

Jenna Hayba:

I would say you know moving their money around a lot and unnecessarily. You know, to the extent that they want to make separate property claims. It gets really difficult to figure out what those are If your money is all over the place. It's moving between accounts randomly and your accounting is not precise. Quite frankly, if you, if you can't look back at your statements or have some record or memory of, ok, I'd move this money here for this purpose and this money came from this other account, that's going to make things really messy to be able to make those arguments about separate property in your divorce case.

Charlie McDermott:

OK, ok, yeah, Very, very helpful. So a few final thoughts here. Janet, are there strategic advantages to settling property division through negotiation rather than litigation?

Jenna Hayba:

Yeah, I mean, I think, like in any other case, the advantage you have is that you have a lot more control over the outcome. I think a good example of this now is something like the division of a house. I mean, right now we're seeing rising mortgage interest rates, difficult to refinance without significantly increasing your monthly expenses, and so your benefit to a settlement is that you may be able to negotiate, and we have a lot of clients now who are negotiating situations where they have more time to refinance a house or they're not forced into a sale and they have more time to do a buyout because of those market conditions. And if you go to court, there's just no guarantee you can secure something advantageous like that or that there would be a trade-off. You know you may be.

Jenna Hayba:

You know there are trade-offs for that because there are risks to the other party, but you don't necessarily get those options. In a litigation context and just generally, you're at the mercy of the judge, who gets a snippet of your life and a snippet of your story and your financial landscape, and so they don't know everything and they make a decision based on a couple of days of hearing, evidence and testimony that are all subject to evidentiary rules, so they're not really probably hearing everything you want them to hear. And then they make a decision for you that will significantly impact your financial future, and so in a settlement context you eliminate that risk a little bit. You may not get everything you want, but oftentimes you're able to reach a resolution that you can live with.

Charlie McDermott:

Good stuff, good stuff, jenna. One last question. If there's one piece of advice you'd give someone beginning the divorce process in Virginia when it comes to protecting their assets, what would it be?

Jenna Hayba:

It would be to hire an attorney. I mean, people come in and there are so many nuances to finances and how they should deal with their finances moving forward. And I get that question a lot like how do we pay the bills? And when it comes to the division of assets, I mean how you pay your bills may affect that. For instance, who's going to pay your mortgage? Because that's paying the bill for your asset and there's a lot of considerations that go into that. You know, how are you going to maintain the assets? I mean, obviously, when you're paying the mortgage you've got to pay other things, you've got to pay maintenance for houses and things and things like that.

Jenna Hayba:

So a lot of people don't know how to navigate that. And that's not surprising because, you know, most people haven't been through divorces. They've never had to adjust to this new reality. But an attorney can help them navigate through that and what to do. And I think that could be their biggest asset because sometimes when they establish their separation period, the damage is done as to how to protect their finances if they come to their attorney six months later and say we've been separated for this long and X, y and Z has happened in the past six months. Sometimes we cannot do that. We can address the circumstances as they are, but if we could have preplanned, maybe that would have affected their financial future and security.

Charlie McDermott:

Yeah, it almost sounds like taking care of your health. I mean, the sooner you take care of it, the less complicated it is Well good stuff.

Charlie McDermott:

Well, jenna, thanks so much for sharing your insights today. Yeah, well good stuff. Well, jenna, thanks so much for sharing your insights today. Property division can feel overwhelming, but understanding the law and your options makes all the difference. Your practical advice has given us certainly a lot to think about. I'm not thinking about a divorce, but you've given me a lot to think about. I mean, my goodness, yeah. And your tip on hiring an attorney, holy cow. Yes, you cannot listen to this episode and even consider trying to navigate those waters on your own, or it's not?

Intro/Close:

it's not going to be pretty.

Charlie McDermott:

Yeah, yeah, for the most part that. That goes for just about anyone considering or considering, you know, just about to enter the divorce process.

Jenna Hayba:

I mean there's there are no two cases alike, I would guess Right, right, yeah, exactly, I mean in in divorce law. So much is fact specific and your divorce attorney can help guide you um through finances, but also things like how do I co-parent with my spouse now that we're in two separate homes? You know your attorney has experience seeing what's happened in other cases to see what to do, what not to do. So maybe that will be the subject of one of our upcoming podcasts.

Charlie McDermott:

Yeah, yeah, yeah, good, good point, yep, but it's not all about money. In fact, oftentimes money is. Is you know down the list, right?

Jenna Hayba:

Yeah, of course.

Charlie McDermott:

Awesome. Well listeners, if you're-R-R-A-N, Mohr, M-O-H-E-Rcom, and be sure to subscribe to Attorneys Dedicated to Family Law wherever you listen to podcasts, and if you found today's episode helpful, please consider leaving a review. Thanks for tuning in and we'll see you next time.

Intro/Close:

Thanks so much. That wraps up this episode of Attorneys Dedicated to Family Law. Thanks for tuning in and we'll see you next time to subscribe so you don't miss our next episode, where another of our experienced attorneys will tackle an important family law issue. Thanks for listening Until next time. We're here to help you protect what matters most.