Practice Points with Mark Scruggs

When it comes to Equitable Distribution, Complaint, Counterclaim, or Motion – It's Your Choice

A few months ago, I received a call from an insured asking for help. She represented a party in a domestic case. She decided to file a motion in the cause for equitable distribution for several reasons instead of amending her client's answer to the complaint that he filed pro se earlier. Opposing counsel moved to dismiss the equitable distribution claim on the grounds that G.S. §50-11 permitted the filing of a motion in the cause for equitable distribution in the limited circumstances described in G.S. §50-11(e) and (f), neither of which was present in the case at bar. Our insured argued to the contrary, and out of an abundance of caution, moved to set aside the divorce judgment so that she could plead her client's equitable distribution claim by counterclaim. Thankfully, the trial court allowed the motion, and the client could pursue his equitable distribution claim. I suspect that many lawyers would have thought opposing counsel's motion to dismiss was well-grounded. But that was before Bradford v. Bradford, 2021-NCCOA – 448, filed by the Court of Appeals on September 7, 2021.

In Bradford v. Bradford, the husband filed a complaint for absolute divorce on October 11, 2019.  The wife was properly served with the divorce complaint. On January 27, 2020, the wife filed a motion in the cause asserting a claim for equitable distribution. The motion was filed at 8:21 A.M. Later that same day, after a testimonial hearing upon the divorce claim, the trial court entered a judgment for absolute divorce. The signed divorce judgment was filed at 10:07 A.M.

The husband filed a motion to dismiss the wife's E.D. claim. The husband argued that the wife did not file an answer asserting a counterclaim for equitable distribution, nor did she seek leave of court to answer or counterclaim for equitable distribution. The husband also argued that the wife's equitable distribution claim could not be asserted by a motion in the cause but that it must be brought by an independent complaint or counterclaim.  The trial court agreed and dismissed the wife's equitable distribution claim. The wife appealed.

On appeal, the husband argued that G.S. §50-21(a) limited the scenarios when an equitable distribution claim may be brought by motion in the cause to the two specific circumstances enumerated in G.S. §50-11(e) and (f). The Court of Appeals disagreed, saying that these subsections addressed only the timing of the equitable distribution claim – allowing it to be asserted after the entry of divorce – not the type of pleading in which the claim may be asserted. Further, none of the statutes addressing equitable distribution (G.S. §50-20 and G.S. §50-21) limit the particular type of pleading for asserting an equitable distribution claim. The Court held that the wife's motion in the cause was sufficient to state a claim for equitable distribution and reversed the portion of the trial court's order dismissing the wife's equitable distribution claim.

There may be circumstances where it is preferable to assert the claim for equitable distribution by motion in the cause rather than by separate action or counterclaim. In my insured's case, the client had made such a mess of things before he came to her, she thought it would be simpler, less time consuming, and less expensive for her and the client to assert the equitable distribution claim by motion in the cause. Bradford v. Bradford makes clear that's OK. Just remember to assert the claim for equitable distribution before the divorce is entered. Nothing's changed there!