What Happens to Injury Settlement in Divorce?
What Happens to a Personal Injury Settlement in a Divorce?
When an individual is injured in an accident, they have the right to seek compensation for their various injury-related losses. These can include economic damages, such as medical bills and lost wages, but also noneconomic damages for pain and suffering, disabilities, and other intangible effects of the injury. Personal injury settlements can often be substantial, so if a spouse files for divorce after an accident, it should be no surprise that the non-injured spouse may try to receive a share of the settlement in the divorce.
Is a spouse entitled to half of a personal settlement in a Tennessee divorce? The Tennessee courts took an in-depth look at this issue in the 2014 case of Metzinger v. Metzinger. While each case will involve a different analysis depending on the specifics of the settlement, the following are some basic principles the courts follow when determining what happens to personal injury settlements in a divorce.
What Part of a Settlement is Considered Marital Property?
When dividing property, courts will decide what is marital property (which will be divided equitably) and what is separate property (which each spouse gets to keep their own). In the above-mentioned case, a wife claimed she was entitled to half of her spouse’s $66,000 settlement stemming from a drunk driving accident. However, the appellate court disagreed that the entire settlement was automatically marital property. Instead, the following portions of the settlement can be marital property under Tennessee law:
- Compensation for medical bills incurred during the marriage and paid with marital funds
- Compensation for income lost during the marriage
- Compensation for damage to any marital property
Generally speaking, any compensation for pain and suffering or other noneconomic damages will be separate property, which the injured spouse will get to keep.
As with many legal issues, there are of course factors that can complicate the situation and exceptions may apply. For example, one spouse might have received a settlement, deposited the funds in a joint account, and used the money to make a purchase for the family, such as a vehicle or a down payment on a home. In this case, the court would likely find that the funds were comingled and the asset purchased would likely be considered to be marital property.
Another issue is whether the marital property portion of the settlement was used to pay for legitimate expenses of the marriage. For example, in the Metzinger case, the court decided that $10,000 of the settlement was marital property. However, the court also found there was more than $13,000 in marital expenses, which meant there was nothing left over to be divided.
Contact Our Sumner County Personal Injury Law Firm for Assistance Today
At the Law Offices of Bednarz & Bednarz, we make sure our clients understand every aspect of the personal injury process, including what may happen to a settlement. We help clients throughout Sumner County after many types of injuries, so please call our office in Hendersonville at 615-256-0100 or contact us online to schedule a free consultation.
