Georgia appeals court reopens property division in divorce over $40,000 basement renovation

A Georgia appeals court has ordered a fresh property division in the divorce case of <b>Meredith Pelayo</b> and <b>Allen Pelayo</b> following a dispute over a house renovation. The court ruled that the lower tribunal incorrectly calculated the marital value of the residence owned by Allen before marriage. The couple had spent approximately <b>$40,000</b> during their marriage to finish the basement and create a separate living area for Meredith's parents. The Georgia Court of Appeals found that the trial court erred by ignoring this marital investment and miscalculating equity gains from market appreciation. The appeals court has vacated the equitable division portion of the February 20, 2025 decree. The case now returns to the lower court with explicit instructions to recalculate the asset distribution using the correct source of funds rule.