26 Oct Divorce & Personal Injury – Who Gets To Keep Lawsuit Proceeds?

What happens when your spouse leaves you right after you settle a personal injury suit? Who gets the money?

 Is it yours? Or do have split it with your ex-wife (or ex-husband)?  

 Or to make things worse, does the new lover get to have a share?

 The answer, like many things in the law, is “It depends.”

In this instance, the answer in divorce court will be dependent on the reason that you were compensated. If the damages were to replace lost wages which were earned during the marriage, the Family Court will likely characterize these as marital property and divide the income between you and your spouse. 

 On the other hand, if they were for future lost wages, then the family court judge would find that they are not marital property and the injured party would be able to keep one hundred percent of them. If you are in a current accident, it is important to discuss this with both your Personal Injury lawyer as well as your family court attorney. This is just one instance where it benefits clients to have us work one or both of the cases.

 Additionally, damages for pain and suffering are typically considered non-marital. This is usually true regardless of the pain and suffering.

 Finally, it is helpful to keep settlement proceeds separate from other assets. In each instance where funds are mixed or commingled, it becomes more difficult to ‘trace’ the source of the funds.

 Bottom line:   settle smartly and discuss this with your lawyer. If not, your ex’s new lover will be in your bed – with your money.