Opinion ID: 2085235
Heading Depth: 1
Heading Rank: 6

Heading: Home Equity Loan

Text: The trial justice declared that the equity line of credit secured by a mortgage on the parties' Cumberland home was a marital debt. In his lengthy recitation of the testimony, the trial justice noted that Giselda admitted that she had withdrawn $27,000 from this equity line of credit on May 13, 2002. However, the trial justice overlooked the fact that, pursuant to § 15-5-14.1, an automatic stay had been entered on April 24, 2002, that prohibited the parties from unreasonably incurring additional marital debt. The evidence establishes that Giselda was served with notice of the stay on May 10, 2002, three days before she withdrew the money. Section 15-5-14.1(c) provides that [n]either party shall incur any unreasonable debts including, but not limited to, further borrowing against any credit line secured by the family residence, further encumbrance of any assets, or unreasonably using credit cards or cash advances against credit or bank cards. John argues that it was error for the trial justice to declare the entire amount of debt incurred against the equity line of credit to be marital debt and to refuse to hold Giselda responsible for borrowing $27,000 in violation of the automatic stay as provided in § 15-5-14.1. We agree. The defendant claims that the money was necessary for household expenses because the temporary order provided inadequate support. However, the appropriate course of action under those circumstances was to seek a modification of the temporary support order or to ask the Family Court for permission to access the line of credit. Section 15-5-14.1 is designed to prevent the parties from incurring additional debt during divorce proceedings. Once served, a party is not free to violate an order of the Family Court with impunity, nor should a trial justice overlook such misconduct. The evidence disclosed that Giselda blatantly violated the automatic stay provision and, we conclude, the trial justice erroneously overlooked this evidence. In designating the entire equity line as marital debt without assigning to Giselda the amount she had withdrawn unilaterally, the trial justice erred. Accordingly, Giselda shall repay to the marital estate the $27,000 she withdrew from the equity line of credit in violation of the automatic stay.