Drafting divorce settlement agreement provisions to dispose of the marital home is not easy. Anticipating how things will play out can be very difficult.
In some cases, one spouse may be remaining in the home with the children for a stated period of time, or until a stated event (such as the children’s graduation). How are bills to be paid in the interim? Will either spouse be entitled to credits?
What will be the procedures when the time/event happens? At the end of that period of “exclusive occupancy” (or perhaps immediately), the parties will be selling the home. Alternatively, one party may want to buy out the other. If the home is to be sold to a stranger, how is the broker to be selected, if there is to be one? How is the initial listing price determined? Must a certain bid be accepted? What happens if there are no bids?
If one spouse wants to buy out the other, how is the other’s interest to be valued? Should the amount of a broker’s commission be factored in? May one spouse have a “right of first refusal,” the right to match a bid from a third party? How will that work?
Take the April 28, 2022 decision of the Appellate Division, Third Department, in Martin v. Martin. There, the parties’ 2012 divorce settlement agreement granted the husband the right to buy out the wife’s interest. The agreement provided that if the husband elected that option, the parties would obtain three appraisals, The husband would pay the wife half the “mean” (average) of those three appraised values minus a commission.