Equitable Distribution Opinion from CAV

The Court of Appeals Tuesday issued a ruling that provides that a trial court has the authority to order a party to refinance a mortgage as a part of equitable distribution proceedings.  The case is Bomar v. Bomar .

The trial court had ordered that possession of the marital residence would be given to the wife pendente lite, with the husband being responsible for the mortgage payments.  In the final divorce decree, the court allocated the residence permanently to the wife, and ordered that she thereafter pay the mortgage.  The husband asked the court to require her to refinance that mortgage, so he would not face potential liability in the event the wife defaulted on the payments.  The chancellor sympathized with the husband’s position, but opined that he did not have the authority to require the wife to refinance the loan.

The Court of Appeals disagreed, holding that the provisions in subsection C of the equitable distribution statute authorized such a requirement.  The court noted that the statute authorized the court to require the receiving party to “assume any indebtedness secured by the property,” and held that this language included the power to require a refinance.  This ruling, the court noted, also helps to bring an end to the litigation by avoiding the possibility of future disputes between the parties over the mortgage payments.