In a divorce proceeding, a personal injury settlement can be a major asset that will have to be divided between the parties. Missouri uses the "analytical" approach to determine whether the settlement proceeds are marital, non-marital, or both.

In a marriage dissolution proceeding, the trial court uses a two-step process for dividing property. The trial court must first set aside non-marital property before it divides marital property “in such proportions as [it] deems just.” Property acquired during the marriage is presumed to be marital, but the presumption may be overcome. A settlement for a personal injury claim occurring during the marriage may be both marital and non-marital.

To determine whether funds from a personal injury settlement are marital or non-marital, Missouri uses the “analytical” approach. Under this approach, also known as “replacement analysis,” the settlement award is classified by what it is meant to replace. To determine the intent of a settlement, a court may look to what the parties would have received if the claims had been adjudicated.  If the award is to compensate for separate, non-marital losses, it is non-marital property; to the extent it compensates for marital losses, it is marital property.

Under the analytical approach, compensation for loss of future, post-dissolution wages is non-marital property, while compensation for wages lost during the marriage is marital. Similarly, compensation for post-dissolution medical expenses is generally considered non-marital, while compensation for medical expenses during the marriage is generally marital.. Compensation for non-economic damages, such as “pain, suffering, disfigurement, disability, and loss of ability to lead a normal life” is generally considered the separate property of the injured spouse.

The Court of Appeals recently held that the trial court did not err in determining that post-dissolution payments due under the settlement agreement were properly characterized as non-marital property. To see the opinion, click here.