high asset divorce

Is a Settlement From a Lawsuit Considered Marital Property?

Equal distribution of marital assets may not apply to settlement awards. 

The State of Florida is an equitable state, meaning that when parties divorce, their marital assets are typically divided between the two parties equally. However, where one party-spouse receives a settlement or personal injury award, the division of assets is not always clear, and many clients facing divorce are left wondering whether they may have any entitlement to the other spouse’s settlement proceeds.

To be very general, settlements or personal injury awards are not considered marital property, and as such, are generally not divided between the parties by the judge at the time of divorce. Nevertheless, there are instances where the non-injured spouse is allowed to share in the other spouse’s settlement or personal injury award.

If the award is “itemized” or specific as to what the award of settlement is meant to cover such as a spouse’s medical bills, lost wages, pain and suffering, or even a loss of companionship of your partner known as “consortium”, then the non-injured party may be able to recover a portion of the award or settlement.  To put it another way, if as a result of your spouse’s injury, he or she could no longer work, was out of work for a period of time, was forced to receive a lower paying salary during the marriage, or where the parties’ used marital funds to pay for the injured spouse’s medical bills, the non-injured spouse may be entitled to receive the portion of the award for those decreased wages or loss of wages the parties experienced during their marriage.

Additionally, where the settlement award was co-mingled, both parties may attempt to claim a stake in the settlement award when divvying up assets in a divorce.

If you have any questions regarding alimony rewards or require legal assistance in other areas of Family Law you may always contact Damien McKinney of The McKinney Law Group to discuss your case further. He can be reached by phone at 813-428-3400 or by e-mail at [email protected].