Opinion ID: 2229930
Heading Depth: 1
Heading Rank: 4

Heading: Application of the Law to the Plans in Issue

Text: In deciding upon and applying a rule for the equitable distribution of these stock plans, we must be guided by the statutory presumption that all property, unless clearly separate, is deemed marital property and must further recognize the titled spouse's burden to rebut that presumption. The Trial Judge thus must first determine, based on competent evidence, whether and to what extent the stock plans were granted as compensation for the employee's past services or as incentive for the employee's future services. We recognize, as have other courts, that any list of pertinent considerations could only be illustrative and not exhaustive ( see, e.g. , In re Marriage of Miller , 915 P2d 1314, 1319, n 9, supra ). However, relevant factors would include whether the stock plans are offered as a bonus or as an alternative to fixed salary, whether the value or quantity of the employee's shares is tied to future performance and whether the plan is being used to attract key personnel from other companies. To portions of the stock plans found to be compensation for past services, a time rule should be applied to factor out any value which may be traceable to the period before the marriage, where the numerator is the time from the later of the beginning of the titled spouse's employment with the issuing company, or the beginning of the marriage, until the date of the grant, and the denominator is the time from the beginning of the titled spouse's employment until the date of the grant. To portions found to be granted as incentive, a second time rule should be applied to determine the marital share, that is, accretions from the time of the grant until the matrimonial action was commenced, and any further accumulations attributable to the contributions of the nontitled spouse. Here, the numerator is the period of time from the date of the grant until the end of the marriage, which is the earlier of the date of the separation agreement or the commencement of the matrimonial action and the denominator is the period of time from the date of the grant until the stock plan matures. Finally, what is determined to be marital property may then be equitably distributed, generally according to the Judge's discretion, here 50/50 as agreed by the parties. On remittal, application of the rules we have enunciated should resolve the issue of what portions of the plans constitute marital property, reflecting the wife's right to share in whatever value of the stock plans accrued during the marriage, during which time she contributed to her husband's successful career in banking through her services as wife and homemaker. The remainder would be separate property, not subject to equitable distribution, which the husband has the right to enjoy, as separate property traceable to the years outside of the marriage, the fruit of his sole labors. Accordingly, the order of the Appellate Division should be reversed, with costs, and the case remitted to Supreme Court for further proceedings in accordance with this opinion. Order reversed, etc.