If you will likely be facing the property division process and you or your partner recently received a personal injury payout, it is important to have someone who can help with clarifying community property when it comes to court-awarded damages. This information can play a vital role in negotiating a divorce settlement or protecting your personal injury proceeds during a legal separation.
A personal injury lawyer may be able to explain which parts of your financial recovery qualify as community property. This is not always as clear as one would think.
Your Spouse and Your Personal Injury Settlement
It is finally time to settle your case, and your attorney calls to tell you that both you and your spouse must come in to sign paperwork. This may raise questions for some accident victims, especially if they are already estranged from their partners. Why would the insurance company put both of you on the check when you were the only one injured?
Most people believe that the insurance companies list both spouses because Louisiana is a community property state and, therefore, each spouse is entitled to their share of a settlement. As an accident law firm in New Orleans, we can tell you that this is not the case. In fact, both spouses are not entitled to a fair settlement after one experiences a negligence accident and injuries.
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Louisiana Personal Injury Settlements and Community Property
Although Louisiana is a community property state, any funds received by one spouse as pain and suffering damages are not considered community property. However, if that spouse also received compensation for a portion of their outstanding medical bills or reimbursement of lost wages in addition to pain and suffering, then their spouse is entitled to half of that portion of the compensation. This is because all debts are community property under Louisiana law.
What this means for separating or divorcing spouses is that the economic damages recovered are generally community property. The injured party must split the proceeds with their spouse as a part of the property division process. However, non-economic damages do not directly relate to debts which are community property. For that reason, compensation for certain losses is not divisible. This could include:
- Pain and suffering
- Loss of quality of life
- Emotional distress
- Mental anguish
- Other intangible losses
Loss of Consortium and Personal Injury Settlements
However, there is one type of non-economic damage that your spouse could claim during a divorce. This is also why the insurer wants your spouse’s signature on the settlement agreement. The real reason insurance companies include both spouses on the release and checks is because whenever your spouse is injured, you have a right to a loss of consortium claim.
Loss of consortium claims provides compensation for any adverse effects the personal injury has on your marital relationship. Typically, these awards are small and can only be pursued via litigation.
It’s important to note, though, that only the injured spouse can settle. The uninjured spouse can still maintain a cause of action against the at-fault party and their insurance company. For that reason, both are required to consent to the settlement as “full and final,” so the insurance company can ensure there will be no further action on the claim.
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What If My Spouse Wants to Claim Loss of Consortium?
If your spouse does want to pursue a loss of consortium claim, it could delay your payout. However, they are entitled to this compensation if the accident and your injuries negatively affected your marriage. A personal injury lawyer can negotiate these damages as a part of the payout in your case.
You should not sign the paperwork if they indicate that they want to seek damages. It is a good idea to speak with an attorney about these damages and the pros and cons of pursuing them. They will be able to review the situation, determine a potential value for these damages, and take steps to help your spouse recover them.
This may be possible even if you and your spouse are struggling to get along or considering divorce. However, it may be necessary to show that the injuries caused or worsened your relationship and that your separation was not pre-existing. Your lawyer can help you understand the best way to prove a loss of consortium and gather evidence on your behalf to support the claim.
Discuss Your Case with a Morris Bart, LLC Attorney for Free Today
If you have questions or concerns about court-awarded damages or the proceeds from your accident settlement and how they will affect the division of community property, you can speak with a lawyer from the Morris Bart law firm today for free. We serve clients in Louisiana, Alabama, Arkansas, and Mississippi. We provide complimentary consultations for potential clients.
Call 1-800-537-8185 to get help with your personal injury case today.
Questions?Call 800-537-8185
to find a Morris Bart office near you.
