Property Settlement Agreements: Negotiating Divorce Property Settlements in Arizona Divorce

Property Settlement Agreements

Negotiating Property Settlements in Arizona Divorce

Are you prepared to negotiate a divorce property settlement agreement in Arizona? Do you know how to begin the process of resolving disputes by agreement? Take a moment to request our free ebook – Getting Started: 7 Must-Do Items for Divorce Planning. We can help.

divorce property division in arizona stewart law groupWhether property division is complex or easy, or somewhere in between, will depend largely upon the spouses’ willingness to negotiate in good faith. This means leaving the emotional baggage of a broken marriage at the door to work out the details of a  distribution plan. Some parties attempt agreements on their own, others negotiate exclusively through their divorce attorneys. As a rule of thumb, the longer the marriage lasted, the more things were acquired, and the more complicated the property division analysis is likely to be. A divorce separation agreement with voluntary property settlement terms avoids expensive, emotionally taxing divorce litigation on the settled issues. And lessens the incidence of appeal.

Is Everything Allocated by Agreement?

Settlement negotiations do not guarantee complete agreement on the disposition of every asset and debt, but even partial agreement represents a positive step toward a final resolution. With any disputed issue remaining after negotiations come to a close, each spouse makes the case for why the judge should rule one way or the other. Every asset and debt must be allocated between the parties before the property division process is complete.  

Make Room in Divorce Proceedings for Mutual Agreement

In divorce, negotiating terms will take effort and cooperation with a big dose of patience and the willingness to resolve disagreements. Have goals and stay focused. Be mindful that every mutual agreement represents one less determination the judge must make at trial. In addition to a proposed property division plan, divorce attorneys with Stewart Law Group also assist their clients in negotiating parenting plan agreements and spousal maintenance terms.

The spouses’ written separation agreement sets forth every agreed term. ARS § 25-317. Absent objection, the court incorporates their separation agreement into its decree of dissolution, legally binding both parties. The divorce decree dissolves the community and distributes all assets and debts, item by item. If property division is contested, then the family law judge must make determinations based upon evidence and arguments at trial. Gathering evidence during discovery is essential.

Property Valuation Experts

Antiques collectibles property division in divorce ArizonaNegotiating a property settlement with joint debt distribution plan, or litigating the matter at trial if necessary, requires the diligent, thorough examination of the facts surrounding each asset’s acquisition, character, value, and use. This can be a challenging process, depending upon the property at issue. Someone with expert knowledge may be needed to perform accurate valuations of specified assets, such as professional practices, investment portfolios, or real estate holdings.

Who Are These Expert Valuators?

Our divorce attorneys routinely utilize the services of certified public accountants, forensic accountants, business valuation analysts, property appraisers, and other qualified professionals trained in accepted valuation methodologies. In any given case, the expert opinion of more than one valuator or appraiser may be needed.

In their property settlement, spouses may assign settled values to some things and require expert analysis of others. The equitable distribution of community and jointly held property required in Arizona law necessarily depends upon valuation, actual or agreed. ‘Guesstimating’ values is rarely adequate and invites problems. Experienced valuators are utilized to analyze and provide detailed reports on the value of identified property interests. Opposing experts may provide a range of reasonable value. Knowing what something is worth helps keep negotiations objectively reasonable, enhancing the likelihood of a fair property settlement that both spouses can live with.

Should an item’s value or classification remain disputed, one or more valuators may provide expert testimony at trial to assist the court in making key findings of fact. A battle of the experts would not be far-fetched. Valuation could be challenged on various grounds, including lack of documentation, inaccurate calculations, hidden assets or concealed liabilities, valuator qualifications and credentials, or use of methodologies not widely accepted.

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Avoid Divorce Litigation with Alternative Dispute Resolution

Spouses are strongly encouraged to settle whatever they can by participating in alternative dispute resolution. ADR proceedings facilitate cooperation and agreements. When parties agree on who gets the family pet, for instance, the animal’s future is secured without litigation. Even in high conflict divorces, settlement is always possible. In this endeavor, the divorce attorney’s negotiating skills and trial experience are invaluable. The settlement keeps the lines of communication open through the attorneys.

When planning to divide property, be prepared to participate in alternative proceedings to divorce litigation – namely, private mediation, ADR settlement conferences, collaborative divorce (Lear more about what is collaborative divorce) and continued negotiation – until a written separation agreement is obtained or disputed issues are crystallized. Expect all of these ADR proceedings in high asset, complex property division cases. The ends justify the means!

Not surprisingly, spouses who utilize ADR to maintain control over their divorce (and their lives) are most likely to be satisfied with the outcome. After all, they had a direct hand in crafting solutions. People can agree to disagree. But without a property settlement, the judge must find facts, make determinations, and enter orders enforceable by and against both parties. Assuming there is no history of domestic violence, the control factor alone should motivate spouses to join in a mutual effort to settle all property concerns.    

What Aspect of Property Division Is Negotiable?

Understand that spouses can control the outcome of their property division by negotiating or mediating a settlement. The property settlement agreement allows them to be creative and detailed with their proposed terms of distribution. Here is a list of points parties may freely agree to:

  • Classification of an asset or debt as community or separate property;
  • Specific valuations or use of particular valuation methods;
  • Pension division by particular method or that retirement accounts remain intact; and
  • Equalization payment made by one spouse to the other in exchange for some specified property interest or to balance out the end result.

In settling their property division, clearly, spouses have remarkable flexibility. With their lawyers’ guidance, they may classify an asset as separate property or, alternatively, as belonging to the community. Community property must be divided, while separate property is assigned only to the owner. Might that be useful in your divorce?

Cost Savings With Settlement Agreements

Resolving the distribution of marital property by agreement can save much-needed family resources, too. For this reason, judges expect nothing less from spouses than good faith efforts to settle. There is no guarantee full agreement will follow negotiation and ADR, but the fact is that a majority of Arizona divorces settle without trial. Partial settlements also help reduce costs by removing issues from the trial agenda. Avoiding litigation whenever possible could save on attorney fees, too. Trials demand intense preparation with attorney billable hours increasing accordingly.

Always give divorce litigation careful consideration, it is not something to jump into without attempting ADR first, second, and third. Listen to your attorney and choose your battles wisely.

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