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When tragedy strikes, the last thing we want to think about is where the dust settles in terms of money. 

But if you suffered an injury and are expecting a personal injury settlement, you may consider how that will affect your marriage financially. 

In Louisiana, all “property” must be defined as either community property or separate property. With our experienced attorneys at Kiefer & Kiefer, you can rest easy knowing what will happen next with your settlement and what we can do to protect it.

This blog will share an overview of what parts of your settlement are just yours and what parts are considered community property.

Separate property vs. community property in Louisiana

Louisiana law says that each spouse has ½ interest in assets gained while married. 

To put it simply, ownership is split in half, with some exceptions. This is called community property and the exceptions are called separate property

Community property can include:

  • Property acquired during a marriage, including wages
  • Gifts and inheritance that were gifted to the spouses together
  • If there is a loss of community property and compensation is due, that compensation is also community property
  • Fruits of any community property

Here are some scenarios as examples:

  • A gift from a family member or friend meant for one spouse = separate property
  • Inheritance, like money or property, for one spouse = separate property
  • Inheritance for one spouse received in cash and put into a joint bank account with the other spouse = community property

Community property laws in Louisiana are the default unless a couple has signed a prenuptial agreement with different terms. The prenup can outline that something that would usually be considered community property will now be considered separate property. Property can be defined however a couple agrees to in a prenuptial agreement. 

But wherever the agreement is unclear or doesn’t address some other type of property, Louisiana law will apply.

What part of a personal injury settlement can be community property?

When you receive compensation to cover financial costs, that compensation is generally considered community property. 

For example, your medical bill debts to the hospital are your spouse’s debts, too. Under Louisiana law, debts in a marriage are considered community property. 

Another example of economic compensation is lost wages. As mentioned before, the regular wages each spouse brings in are considered community property. So, compensation for lost wages falls under that same logic.

What part of the settlement is separate property in Louisiana?

Economic damages are community property, while non-economic damages are not. According to Louisiana, these kinds of damages cannot be divided between spouses.

Non-economic damages can include:

  • Pain and suffering
  • Loss of quality of life
  • Emotional distress
  • Mental anguish

The one exception is if the non-economic damages affect the marriage. When a spouse is injured, the other has a right to file for loss of consortium. The spouse that was not injured can claim compensation from you and the party at fault or the insurance company. 

Let’s say you file a claim against the party at fault and the insurance company outlines what they owe you by the end of the case. You and your spouse may be asked to sign off as a married couple so that this is the last the insurance company will hear about this case.

Later on, your marriage could suffer as a result of the injury, even taking into account the compensation you receive. Your non-injured spouse can then file for loss of consortium. In other words, your spouse may claim to have suffered non-economic damages and can either:

  • Settle the amount with you in court
  • Sue the party at-fault or the insurance company for non-economic damages (if they didn’t sign that agreement from the insurance company)

Contact our dedicated attorneys at Kiefer & Kiefer

When you suffer an injury, there are many steps along the way that may be missed without the right attorneys. Kiefer & Kiefer is a decades-old firm dedicated to helping New Orleans families recover from serious personal injuries. We care about our clients and support them through difficult situations. Contact us today.

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