Appellant Kenna Newman appeals from a final decree of divorce.1 Appellant and appellee Sean Patton were married September 1, 2002, and became officially separated on August 1, 2007. The parties’ primary dispute concerns the division of stock options awarded to appellant from one of her employers. Appellant had a total of 140,750 stock options issued to her from her employer Crown Castle for whom she worked from May 1999 to April 2006. Although the stock options were all awarded to her prior to the marriage, a portion vested before the marriage and a portion vested during the marriage. When she left her employment with Crown Castle in April 2006, appellant risked losing all of her accumulated options unless she exercised them within two years of leaving the company. Accordingly, she exercised her Crown Castle options in 2006 and 2007, using them to create a Charles Schwab investment portfolio. The trial court held a final hearing on September 9, 2008, and issued the final divorce decree on February 16, 2009. Determining there was no Georgia case law on point and relying on cases from Virginia,2 the trial court held the 56,993 options which vested before the marriage were not marital property and the 83,757 options which vested during the marriage were akin to deferred compensation and thus constituted marital property to which appellee was entitled to his equitable share of 40.5. The final decree of divorce also determined appellee was entitled to 40 of an IRA account which appellant opened prior to the marriage and to which she made only a contribution of $500 during the marriage. In addition, the trial court held that appellee was entitled to $200 of a deferred compensation plan account appellant opened prior to the marriage and to which she made no contribution during the marriage.
1. Appellant contends the trial court erred when it determined that the Crown Castle stock options which vested during the marriage were marital property subject to equitable division. While we express no opinion as to the ultimate outcome in this case, we agree the trial court erred when it relied on Virginia cases interpreting a Virginia statute Va. Code Ann. § 20-107.3 to determine that the stock options were marital property because the options were akin to deferred compensation and because they vested during the marriage. Georgia law does not have a similar statutory scheme or support such a bright-line rule as announced by the trial court. In this state, property is subject to equitable division if it is ” ‘acquired as a direct result of the labor and investments of the parties during the marriage. . . .’ ” Payson v. Payson , 274 Ga. 231 1 552 Ga. 839 2001. See also Dasher v. Dasher , 283 Ga. 436 1 658 SE2d 571 2008. In Payson , this Court used this overarching principle to hold that the property interest in stocks brought to the marriage by the wife and stocks the wife received by using pre-marital assets to purchase stock options which had vested prior to the marriage were not marital property subject to equitable division because they were neither generated by the marriage nor accumulated during the marriage. Payson , supra, 274 Ga. at 232 1 a.3 As to the stock options that were awarded prior to the marriage and vested during the marriage, the trial court’s analysis was inaccurate and incomplete. Based on the overarching principal announced in Payson , the trial court was required to look at the evidence and determine whether the vesting of the previously awarded stock options was the direct result of the parties’ labors and investments during the marriage. If the previously awarded stock options vested because of efforts made by either party during the course of the marriage, then they are marital assets; otherwise, they are appellant’s separate property. Key to the trial court’s underlying factual inquiry and any decision it may make as to equitable distribution, if any, is consideration of a multitude of factors including, but not limited to: whether the marital or premarital funds were used to exercise the options; the employer’s purpose for granting the option i.e., for past, present or future service;4 the best formula for apportioning the marital share of the options based on the purpose and timing of the options in relation to the time of the marriage;5 a method of distribution to appellee; and the parties’ tax obligations resulting from distribution. See Payson , supra, 274 Ga. at 231 wife used premarital funds to exercise stock options; Tracy Thomas, The New Marital Property of Employee Stock Options , 35 Family Law Quarterly 497, 510-525 2001. The fact that the previously awarded stock options vested during the marriage is not determinative in and of itself of whether the options constitute a marital asset. Dasher , supra, 283 Ga. at 436 “ Property does not become a marital asset simply because one of the spouses obtains it during the course of the marriage.”
