Dillon and Kathy: A Divorce Lawyer’s Example of Improving Separate Property in Louisiana

Sometimes married couples make improvements to each other’s property.  When the property is shared between them (called “community property”) then those improvements are also shared equally.  However, the situation can be far different if the property which has been improved only belonged to one of the spouses.  Let’s consider an easy example that a divorce lawyer might encounter.

Let’s say Dillon and Kathy are married for five years.  Before they got married, Dillon had purchased an old antique sports car.  At the time he purchased it, the car was barely worth anything because most of the parts were missing and the body was in horrible shape.  In fact, Dillon was so embarrassed about the state of the vehicle that he did not even tell Kathy that he owned it until they had been married for four years.  Kathy could not believe that Dillon would keep something like that from him, and she demanded to see it immediately.  Dillon promptly drove her to a garage on the outskirts of New Orleans where he had been keeping it stored.

When Kathy saw the car she thought it was awesome.  Somewhat ironically, she had never revealed to Dillon during the course of her marriage her enormous affinity for antique sports cars.  In fact, some of her fondest memories as a child involved working on these exact type of cars with her father.  She told Dillon that she wanted to fix the car up herself.  At first Dillon was skeptical, but Kathy kept pestering him about it.  Finally, he agreed.  The arrangement was that Dillon would buy the parts and Kathy would install them.

About six months later, much to Dillon’s amazement, Kathy had made good on her promise.  Her work was flawless; and the changes which she made had returned the car to its former glory.  A few weeks after she was finished, Dillon had the car appraised.  Despite the fact that he had bought the car for only one thousand dollars, as a result of Kathy’s improvements the car was now worth over twenty thousand dollars.  Dillon was not sure what he would do with his new automobile, so he kept it in storage.  One year later, he retained a divorce lawyer to end his marriage.  Kathy was particularly flummoxed about the work that she did on the car; and she believed that she should be reimbursed in some way.

A divorce lawyer may advise Kathy that she may be entitled to some form of remedy under Louisiana Civil Code article 2368.  This Code article states that if a spouse performs “uncompensated common labor” on a piece of separate property of the other spouse, then that spouse  “…is entitled to be reimbursed from the spouse whose property has increased in value one-half of the increase attributed to the common labor.”

In this hypothetical, the car is most probably Dillon’s separate property because it was purchased by him before he was married to Kathy.  Clearly though, Kathy performed significant uncompensated labor on the car which increased its value tremendously.  Because the value was increased by nineteen thousand dollars, Kathy could argue to a Louisiana court that she is entitled to eight thousand dollars from Dillon.  Dillon’s divorce lawyer might counter with the price that he paid in parts to supplement her labor.

This article is written to be general information only; it should not be taken as formal legal advice.  Will Beaumont.  New Orleans.