Domestic Relations – Equitable Distribution – Classification – Workers’ Compensation – Real Property – Mortgages

The year after the parties’ marriage, the plaintiff-husband sustained work-related injuries for which he received a settlement payment of $585,000. Although the trial court found that a portion of the settlement amount was marital property, the court found that any such separate property was expended during the marriage to increase the parties’ standard of living while they were un- or under-employed. Since plaintiff maintained the balance of the settlement funds in a separate account, the trial court’s classification of a portion of the settlement as plaintiff’s separate property was based on competent evidence.

We affirm the trial court’s equitable distribution order.

Before the parties’ marriage, plaintiff owned the property that became the marital residence. During the marriage, the property increased in value due to both active and passive forces. The only active increase came from mortgage payments, and the trial court properly classified this increase as marital property. The trial court did not err by classifying the passive increase as plaintiff’s separate property.

Foster v. Foster (Lawyers Weekly No. 012-109-23, 13 pp.) (John Arrowood, J.) Appealed from Currituck County District Court (Robert Trivette, J.) Lloyd Smith for plaintiff; Edward O’Neal for defendant. North Carolina Court of Appeals (unpublished)