Divorce is a matter of state law in the U.S. in almost every circumstance. Each state has jurisdiction over family law disputes within its territory, but more and more people’s lives are not contained within a single state. People living in New York City might own real property in another state, and assets can cross state lines in other ways. This can create complications in a divorce case, since state courts can only exercise jurisdiction over property located in that state. New York law allows courts to distribute property located in this state after issuance of a divorce decree in another state or another country. A recent order by a Manhattan court addressed a dispute over property located in New York City, between spouses whose divorce case was pending in Monaco. THA v. MAA, No. 161488/2015, dec. order (N.Y. Sup. Ct., N.Y. Cty., Jan. 18, 2017). The order offers an idea of how and when a party to a divorce should seek a New York court’s involvement in distribution of property.
The dispute in THA involves two main legal issues: the alleged concealment of marital property and the court’s jurisdiction over property located in New York City. In a divorce matter, the spouses must make a full disclosure of all marital property in their possession or subject to their control. Intentional concealment of marital property from the other spouse or the court can result in sanctions, and can also affect how the court orders the distribution of property.
In order to bring an action in a particular court, the plaintiff or petitioner must be able to show that the court has jurisdiction over the defendant, known as in personam jurisdiction, or over a particular item of property, known as in rem jurisdiction. A New York City court might have in personam jurisdiction over the parties to a divorce if they live here, but it would lack in rem jurisdiction over property located outside of the State of New York. If a divorce decree issued by a court outside of New York affects property located in New York, § 236(B)(5) of the Domestic Relations Law (DRL) allows the courts of this state to order the distribution of such property, mostly in accordance with New York law.