Property division negotiations between divorcing spouses often become contentious, and this is especially true when they have significant assets and live in a state like California with strict community property laws. Art collections sometimes account for a significant part of the marital estate in high-asset divorces, but dividing them is rarely easy. Even placing a value on artwork can involve lengthy and intense negotiations.
Separate and marital property
Only assets that were acquired during a marriage are divided in a high-asset divorce. Artwork that either spouse owned before walking down the aisle are considered to be separate property, which means they are not subject to division. However, matters can become nebulous when community funds like money deposited in a joint bank account is used to maintain, improve or insure separate assets. This is called commingling, and it can turn separate assets into community property.
Placing a value on art collections
Determining how much paintings or sculptures are worth is a subjective process, but spouses must reach an agreement on the value of an art collection before it can be divided in a divorce. Each spouse may want their own appraiser to put a figure on the value of individual pieces or an entire collection, and a third or even fourth appraiser may have to be called in to settle matters.
Emotional manipulation and prenuptial agreements
People who spend years or decades acquiring art often develop a great fondness for their collections, and their spouses may try to take advantage of this emotional attachment during divorce negotiations. Couples who want to avoid bitter legal disputes may be able to avoid them by entering into prenuptial or postnuptial agreements. These contracts allow couples to determine in advance how their assets will be divided if they decide to divorce, but they should be negotiated in good faith and essentially fair.