One of the most important aspects in a divorce case is the preparation and filing of an accurate sworn inventory and appraisement of community and separate assets. The inventory and appraisement, otherwise known as an “I&A,” is a document which lists any and all of the assets owned by the community as well as the separate assets of each spouse. and will show in detail the approximate value of both the petitioner’s and the respondent’s respective assets. The I&A acts as a blueprint to determine a fair and equitable split of the community assets to both parties. While an I&A does not prevent the concealment of marital assets, exchanging I&A forms between the parties can go a long way in preventing concealment and can enlighten each party to the assets held by the marital community. In many cases, one spouse is delegated the task of managing finances on a daily basis while another is tasked with managing retirement benefits and the acquisition of property. An I&A can enlighten each spouse to the state of the community estate in a non-confrontational and open manner, cutting down on the need for extensive, thorough, and costly litigation.
While exchanging sworn I&A’s provides no guarantee to the extent of discovery and litigation, the I&A can provide an idea as to whether the parties are even on the same page with each other as to what assets are to be considered community property and what assets are to be considered separate property. If the parties are willing to negotiate and produce similar I&A forms, litigation can potentially be much less extensive and much less costly with regard to the division of the community property for both parties involved.
Community property is defined as property, other than separate property, acquired by either spouse during marriage. Clients are often caught off guard when we begin to speak about the assets of both the community and the separate property assets of each party, especially when divorcing after many years of marriage. Clients make the mistake of thinking the only assets to divide upon divorce are bank accounts, cars, and the martial home. Clients can also make the mistake of believing that certain assets are community assets when in fact the assets are actually separate property.
Because clients can overlook both community and separate assets it is important to spend time on the inventory and appraisement and present as much detail about when and how property was acquired. An inventory and appraisement does not merely act as a guide to determining what the total value of the community estate is, but also provides direction which can help guide each party locate and present what separate and community assets he or she believes exist and the approximate value of the assets. How and when property was purchased can affect the categorization of property as separate or community and the preparation of an accurate inventory and appraisement can be critical to a fair and equal division of community property.