Legal Question in Bankruptcy in New York

Re: Effect of bankruptcy in di vorce action

Jointly held property, held by a husband and wife, is generally deemed held as tenants by the entireties. It passes on death from one to the other, automatically, by operation of law. Upon a divorce, it becomes tenants in common, which means it no longer passes to the (former) spouse. I advise clients, in a contested divorce, which may go on for years, to destroy the tenancy by the entireties by transferring a deed from himself as tenant by the entirety to himself as tenant in common. Most clients in divorce would not want their share of the joint property to go to the now-hated and loathed spouse if they die during the proceedings.

Maybe your question is really, can the divorce court sell the asset out from under you. The answer is, generally, yes. However, you may have some arguments if the property was aquired prior to 1979, since that's when the new Bankruptcy Code came into effect, and our Constitution generally says the government can't take away property rights retrospectively.