What Is Considered a Dissipation of Marital Assets in a Massachusetts Divorce?
When a marriage breaks down, there is sometimes a temptation by one spouse to either try and hide assets or to spend down assets on themselves in order to keep the other spouse from getting it in the looming divorce. The latter course of conduct is known as dissipation of marital assets and it can have a significant impact on divorce proceedings. Put simply, if the court determines there has been a dissipation, the judge can take that into account when making an equitable division of marital assets.
Adultery, Gambling, and Other Wasteful Spending
Broadly speaking, dissipation refers to a spouse’s spending for their own personal enjoyment at a point where the marriage is apparently coming to an end; from such spending, the court may infer the spouse’s goal was to deprive the other spouse of their fair share of the marital estate. So to be clear, if a spouse makes a bad investment decision or goes on a vacation while their divorce is pending, that alone would not be classified as a dissipation of marital assets. What we are talking about here is wasteful spending that circumvents the process of equitable distribution.
Perhaps the most commonly cited example of wasteful spending is one spouse using marital funds to support their extramarital affair. While proof of adultery is no longer necessary to obtain a divorce in Massachusetts, a court may consider evidence of dissipation of marital assets on adultery as a factor in making an equitable division of property. This would clearly be a case of a spouse spending money on their own interests at a point where their marriage is breaking down.
Another common dissipation scenario is where one spouse excessively gambles. Again, the mere fact one spouse incurs gambling losses is not, in and of itself, proof of dissipation. For example, one of the seminal Massachusetts Supreme Judicial Court cases on dissipation of marital assets, Kittredge v. Kittredge (2004), involved a husband who incurred over $400,000 in gambling losses. The Court determined this entire amount was not dissipation, however, since the gambling occurred “throughout the parties’ marriage — it was not something that started in response to the breakdown of the marriage or in anticipation of divorce.” That said, the Court let stand the trial judge’s determination that husband’s gambling losses incurred during the final year of the marriage, about $40,000, justified an adjustment of the final division of property in favor of the wife.
A final common type of dissipation involves a spouse simply giving away or selling marital assets below fair-market value. For instance, if a spouse transfers title to a car to a relative for a token amount, that could qualify as dissipation. In some cases, spouses have even gone so far as to destroy assets in an attempt to prevent their distribution to the other spouse.
Contact a Peabody High-Net-Worth Divorce Lawyer
The more property a couple has during a marriage, the more complex the process of distribution can become when the marriage breaks down. This is why it is crucial to work with an experienced Peabody high-net-worth divorce lawyer. Contact Reade Law Firm, PC, today at 978-767-8383 to schedule a consultation.
Source:
scholar.google.com/scholar_case?case=18166250714859064531