As a recent post by Stephanie Stecklair Tarantino notes, many family law attorneys are gearing up for what is commonly known as busy season. This is an increase in divorce matters that typically occurs after the holidays.  Many of these cases also involve the division of marital assets. Since the divorce process can move slowly through the court, it is important to understand what you can and cannot do with marital assets while the case is pending. For example, should the issue arise, it is important to know whether you can sell an asset or not.

In Delaware, that question is answered by statute.

Delaware law states that neither party can “transfer, encumber, conceal or in any way dispose of property except in the usual course of business or for the necessities of life and requiring the parties to notify the other of any proposed extraordinary expenditures and account to the Court for all extraordinary expenditures….”  13 Del. C. §1509(a)(1).

This law is designed principally to prevent either party from disposing of marital assets that could be distributed in the divorce or any assets that may be looked to as a source of support for any children of the marriage or to satisfy any order the court may issue. 

While the purpose of the statute is clear, the meaning can be less so.

It is not always clear what is considered “the ordinary course of business” or what constitutes a sale “for the necessities of life.” The answer to the question of whether or not an asset can be sold depends on the facts of the case, the nature of the asset, and the reason for the sale.  As a result, the question of whether to sell or not to sell can be a complicated one. 

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