KY & OH: “EQUITABLE” IS ALWAYS FAIR, BUT NOT ALWAYS EQUAL

Pitman v. Pitman, NO. 2013-CA-000249-MR (Ky. App. 2014)
The Trial Court Has Discretion to Award the Entirety of a Marital Retirement Account to One Party

Rendered:  October 24, 2014
Not To Be Published
Opinion Affirming

Another case where it doesn’t matter whether you are a practitioner in Kentucky or Ohio. The law is essentially the same on this point: Kentucky and Ohio law provide for an equitable division of marital property upon dissolution of a marriage. The word "equitable" means "fair," which does not always equate with an equal division of property. (Say that ten times fast.)

 Division is not always 50/50

Division is not always 50/50

While Ohio Revised Code (ORC) § 3105.171 does state that a division shall be equal, it allows the court to order an unequal division if "an equal division of marital property would be inequitable." The statute contains various factors for the court to consider in deciding whether to award an unequal division of marital property.

Kentucky Revised Statute (KRS) § 403.190 has similar effect. Although the statute does not expressly reference an ‘equal division’ of marital assets, as does the ORC, it does require the court to divide marital property in “just proportions” with consideration of “all relevant factors” (including a list of four specific factors). It is well settled that, pursuant to KRS § 403.190, an unequal award of marital retirement benefits is proper if needed to make the overall division of marital property in “just proportions”. See Pitman at page 4, citing Snodgrass v. Snodgrass, 297 S.W.3d 878, 888 (Ky. App. 2009); Smith v. Smith, 235 S.W.3d 1, 17 (Ky. App. 2006); Overstreet v. Overstreet, 144 S.W.3d 834, 839 (Ky. App. 2003). 

In Pitman, the facts are more interesting than the outcome, in that the above-holding is not breaking news. Husband and Wife lived apart much of their marriage, with Wife ultimately raising their son in Kentucky. Wife had a successful business designing “Fabulous Hats” and selling them at various events, including the Kentucky Derby (she was eventually successful enough to have a brick and mortar establishment). During big hat events (pun intended), Husband would come to Kentucky and care for their son while Wife tended to her business. Wife did not disclose her business assets, but during a single event she earned as much as $100K in gross income. 

During the pendency of the divorce, Husband offered that Wife keep her business and in exchange Husband would keep his retirement account, estimated at $25K (both were marital property). Wife did not agree, arguing she contributed to Husband’s ability to earn a living by caring for their son.

After considering the relevant factors set forth in KRS 403.190(1), particularly (1)(a), the trial court awarded Wife’s business to her and Husband’s retirement account to him.  Wife appealed, wanting half of Husband’s account. The Court of Appeals affirmed, finding the trial court did not abuse its discretion.

As I said, nothing newsworthy here, just a reminder that you have license to be creative (pun intended) when negotiating the division of marital assets.  It isn’t necessary that marital assets just get divided down the middle. However, when on the defensive, it may not hurt to remind your client that the trial court can divide the marital piggy any way it deems equitable in light of the parties’ circumstances.