Equitable distribution involves identifying assets and liabilities, classifying them as marital or nonmarital, addressing valuation questions where they matter, and allocating the results in a way the parties can carry out. Disputes can arise anywhere along that path. In mediation, the focus is often on reliable information and on practical structures that participants may choose to adopt and implement.
How Mediation Helps In This Context
Participants often use financial information, including equitable distribution worksheets and financial affidavits, to evaluate positions and identify areas of agreement or dispute. They can test assumptions regarding classification, valuation, and allocation, and consider how different structures affect overall distribution, implementation, and support considerations.
Where valuation questions involve assets such as business interests, real property, retirement accounts, or equity compensation, participants may evaluate a range of potential outcomes and determine whether additional information would assist the discussion. They can also consider how proposed distributions will be carried out, including timing, transfers, and related financial or tax considerations, and whether involvement of financial or valuation professionals is necessary, if not already engaged. In practice, participants frequently consider the uncertainty of how the matter could be decided if it continues through litigation, the cost and time involved in continuing, and whether further proceedings are likely to produce a materially different result. They may consider how positions and communication between them may be affecting movement in the case. In practice, valuation ranges, liquidity constraints, and tax considerations often shape how distribution structures are developed, and addressing those factors together can materially affect what options are workable.
Common Issues
- Business interests and professional practices
- Real property and mortgages
- Retirement assets and deferred compensation
- Equity compensation and vesting schedules
- Nonmarital claims and tracing questions
- Equalizing payments and timing
Some Considerations For Counsel Preparing For Mediation
- Consider preparing a complete equitable distribution worksheet, with all assets and liabilities, including any disputed classifications or values
- Identify the key documents that inform valuation ranges
- Consider tax timing and transfer mechanics that may affect structuring
- Identify any valuation methodologies or assumptions that may need to be evaluated