When times are good, the in-laws may help you with your separate debt. When times are bad, they will probably want their money back.
A divorce lawyer can help prevent problems from spiraling out of control. After one gets married, it is not uncommon for one of the spouse’s parent to pay off the other spouse’s debt. If the debt existed before the community property regime, then the debt is his separate debt. As you can imagine, issues arise with regard to whether a debt was separate or community property.
If you feel you are owed because you paid off your ex-spouse’s separate debt, it is advised that you speak with an experienced attorney. Sometimes you may be able to recover was the ruling in this case. However, when a debt is incurred as part of the community property regime, you cannot recover everything for which you paid. You will be entitled to one-half.
Going through the facts of a case may help to explain how working with a divorce lawyer early on can help minimize conflict. A Louisiana court reviewed a case whereby the former-husband was ordered to repay his former wife’s parent’s for a loan that was given to him to pay off a credit card debt.
As a result, her parents paid $1,153.71 to a credit card company just to get their former son-in-law’s account current. Shortly thereafter, the parents took a $23,000 mortgage from which they paid off their former son-in-law’s account. The former son-in-law claimed it was a gift, while his former mother-in-law distinctly remembers extracting his promise to pay $400 a month. It may have worked out easier if a divorce lawyer had advised that this agreement be put into a written agreement.
The trial court ruled in favor of the former in-laws stating that the debt which was paid off incurred before the commencement of the community property regime. A problem with what the in-laws did is that their actions could be considered a donation rather than a loan to be repaid. Because neither side had a divorce lawyer to draft a contract reflecting the nature of the payments, it left the court to interpret the actions.
The in-laws proved the existence of an obligation. As a result, the burden shifts to the debtor, the divorce lawyer, or other counsel to prove any defense. The son-in-law proved no payment, credit, offset, or any other defense. As such, the trial court did not abuse its discretion in awarding the full amount of the loan to the former in-laws. As such, the ruling of the trial court was affirmed.
From the view of a divorce lawyer, what can be learned from this case? Do not expect your separate debt to be considered community debt. Even though you may have taken out a loan during the marriage, the debt to which the loan was applied was incurred before the marriage. However, if you and your spouse incurred debt during the marriage, then that debt will be considered community debt for which both parties are responsible.
Please note that this article on separate debt is simply meant to be informational. Consult an attorney for legal advice. Will Beaumont’s law office is in New Orleans, La.
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