Divorcing couple can't be forced to sell land to settle debts

CONCORD, N.H. --A judge cannot order a divorcing couple to sell property to settle their marital debts, the state Supreme Court said.

In a unanimous ruling Tuesday, the court said it was the first time it had considered the question.

The ruling came in the divorce of Kathlyn and Keith Beal, who were about $90,000 in debt when a judge in Hillsborough County Superior Court in Nashua ordered them to sell property in Canada worth more than $50,000.

The Beals already had sold marital property worth about $22,000, which was held in an escrow account administered by a lawyer.

Judge Bernard Hampsey ruled it would be unfair to award the Canadian property to either one of the Beals. He ordered the lawyer to sell it, put the proceeds in the escrow account, negotiate settlements with the Beals' creditors and pay their debts.

Kathlyn Beal appealed, saying nothing in state law allowed the judge to award the couple's property to their creditors. The high court agreed, noting that state law specifically authorizes judges to divide property "between the parties."

The ruling cited similar decisions in other states, including one in Arizona that said it was a bad idea to turn divorces into collection proceedings, because it would essentially require creditors to intervene in divorces if they wanted to be repaid.

The court voided Hampsey's order and sent the case back to the Superior Court for further action.

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On the Net:

Decision in Beal v. Beal: http://www.courts.state.nh.us/supreme/opinions/2006/beal028.pdf