Opinion ID: 1781943
Heading Depth: 2
Heading Rank: 2

Heading: Inherited Property and Inter Vivos Gifts

Text: Whether acquired prior to the marriage or during the marriage, statutes in most jurisdictions provide that trusts, inherited property and inter vivos gifts are separate property and not subject to equitable distribution. Because the majority adopts a definition of marital assets which encompasses any and all property acquired or accumulated during the course of the marriage, we are left with a system which subjects inherited assets to distribution when equitable considerations so dictate. Under the majority opinion, a widow, upon remarriage to a less fortunate gentleman, could jeopardize her share in her first husband's estate. A parent who purchases a house for his college-age child as joint tenants might find himself in co-tenancy with the child's spouse, and, later, ex-spouse. An individual devising a will or establishing a trust fund must carefully structure his granting language so that his intent is not thwarted should the beneficiary later marry and then divorce. As one court aptly pointed out: Finally, we are mindful that the inclusion of inherited property in the marital estate subjects it to being removed from the natural line of succession, thus thwarting the desire of the persons who acquired it and passed it on to the spouse in possession. At the same time, the spouse who made no contribution toward acquisition of the property benefits from the windfall award. Hussey v. Hussey, 280 S.C. 418, 423, 312 S.E.2d 267, 279 (Ct.App. 1984). In those instances where gifts, trusts and estates may be considered by the courts in the process of dividing marital property, legislatures and courts in other jurisdictions have looked not at the perceived relative needs of the parties, but at factors such as the origin of the property; whether it has been used for the common benefit of the parties; whether it has been commingled with other assets; the characterization of income from and appreciation of the asset in question, and the beneficiary's right to invade corpus. See Michael Diehl, Note, The Trust in Marital Law: Divisibility of a Beneficiary Spouse's Interest on Divorce, 64 Tex.L.Rev. 1301, 1338-1354 (1986).