If you are considering filing for divorce, there are several automatic orders that you need to be aware of. Not only do you need to be aware of them for your own compliance, but to ensure you are protected from any potential violations by the other party.
When a divorce action is filed with the Court, both parties should receive notice of Domestic Relations Law Section 236, (DRL §236(B)(2)(b). The notice sets forth five binding provisions for the parties for the entirety of the divorce action. These automatic orders can only be modified by a supplemental order of the Court which the parties may agree to do.
During a divorce proceeding, neither party is allowed to sell, transfer, or otherwise attempt to hide or dispose of any property. This includes real estate, personal property, cars, boats, and money held in bank accounts. This also includes stocks, mutual funds, crypto currency, NFTs, and other financial property. By way of example, you could be found to have violated the automatic order if you liquidated or transferred crypto currency during a divorce without the consent of the other party. You also cannot transfer real property to another person in an attempt to remove it from the marital estate or distribution by the Court.
There is also a prohibition on transferring or withdrawing any retirement assets or applying for retirement benefits. If you are considering taking your pension and retiring, or if you are already retired and make withdrawals from a 401k or IRA, you could be faced with the challenge of continuing to do so. If you cannot obtain consent from the other party, you may have to seek relief from the Court through litigation. If you have a pension and are already in pay status, you can continue to receive your payments without interference from the automatic orders.
Another prohibition is incurring unreasonable debts or borrowing against a home equity line of credit linked to the marital residence. Parties are also prohibited from unreasonably using credit cards, including taking cash advances. However, continuing to use credit cards for reasonable and customary expenses or for attorney’s fees for the divorce is permissible. Parties are essentially held to keep the status quo of their economic partnership to avoid disruption to the payment of household bills and expenses. There is also built-in flexibility for hiring an attorney to represent you in the divorce action itself.
Additionally, health and dental insurance must also remain in place. Neither party can remove the other, or any children of the marriage, from a health or dental insurance policy. During the divorce process, arrangements can be made regarding each party’s contribution to the premium costs, if any. However, the law makes it very clear that health and dental insurance must remain in place until the divorce is complete. Upon the issuance of a final judgment of divorce, health or dental insurance coverage for a spouse may be terminated. It is important to wait until the judgment has been issued by the Court before changing or terminating any health or dental insurance coverage.
Finally, there is a similar prohibition on changing a beneficiary to an existing life insurance policy as well as a mandate to maintain existing life insurance, automobile, homeowners, and renters insurance policies in full force and effect. The common theme with the Orders is maintaining the status quo. Parties may run into an issue with their auto insurance if they have already physically separated. In reality, the auto insurer may require separate policies if the parties no longer have the same address and their daily-driven vehicles are primarily located at separate addresses. It is important to remain realistic and flexible when it comes to an issue such as this one. It would be more prudent for parties to separate their policies on consent than to seek a remedy from the Court regarding car insurance. When it comes to life insurance, changing a beneficiary from a soon-to-be ex-spouse to one’s children is still not allowed. The sentiment for the same is understandable, but it is not the proper course of action to take, and it could have costly ramifications.
It is important to review these Orders upon commencement of a divorce action so that you can not only protect yourself but also avoid a violation. Unfortunately, a party cannot claim that they were unaware of the Orders as a defense. There is a significant risk associated with this careless mistake, and being informed and consulting with an attorney is the best course of action to take.
