Tag Archive for: marital assets

While fault plays a role in determining an equitable division of marital assets, it’s generally not overemphasized.

It’s understandable and natural to want to point fingers and assign blame in divorce. However, the goal of the court is not to award blame and innocence, but rather to find an equitable division of marital assets.

In Michigan case law, the general trend is to limit the role of fault arguments in divorce settlements.

Dissipation of assets — a legal concept that is related to fault — means that one spouse has used money from the marriage for purposes not related to the marriage, like money spent on a lover.

Courts will generally attempt to “even out” any dissipation of assets to make it fair for the non-dissipating spouse.

Examples of how courts view “fault” when determining a divorce settlement:

Several cases have stated that in considering fault, only behavior causing the breakdown of the marriage is pertinent in making divorce rulings.

The Role of Fault in Dividing the Marital Estate by Lakeshore Law & MediationFor example, in the Knowles1 case, the court found “fault” after the date of filing for divorce was not pertinent because it did not lead to the breakdown of the marriage.

In the Zecchin2 case, the trial court ruled that the wife was at fault for the breakdown of the marriage because she had ordered the husband to leave.

The Court of Appeals did not agree with the trial court about the ruling stating “fault” is based on the conduct of the husband or wife leading to the separation rather than on who left whom.

The Court of Appeals reviewed the trial court’s ruling and said that the husband and wife were equally at fault for causing the marriage to breakdown. The trial court was instructed by the Court of Appeals to “do over” and directed the trial court not to consider fault when re-calculating spousal support.

Even when fault leads to the breakdown of the marriage, courts are not to overemphasize this factor. Fault is only one of a number of pertinent factors in the court’s goal for an equitable division. Fault is not to be used to punish but only to make things “equitable.”

If you’re facing divorce and need assistance, the attorneys Lakeshore Law & Mediation are here to help. Contact us today and let us help guide you forward.

References:
1. https://www.courtlistener.com/opinion/2212417/knowles-v-knowles/
2. http://www.leagle.com/decision/1986872149MichApp723_1790/ZECCHIN%20v.%20ZECCHIN

What is the Value of My Marital Estate?

Generally speaking, a marital estate is divided equitably. In order to divide a marital estate, your divorce attorney must know the values of all assets and debts. The value of those assets may require the opinion of an expert on valuation. The court looks at many factors to determine how to divide assets and debts.

If a husband or wife wants to include an asset or debt in the marital estate, that person bears the burden of proving a value. The court may rely on expert testimony to determine the value of assets, such as real property, art, antiques,  guns, coins, and business interests.

Determining the Value of Your Marital Estate with Lakeshore Law & Mediation

Your attorney, together with a valuation expert, can help determine the value of your marital estate to ensure assets and debts are properly assessed.

In the case of a closely held business, if the court does not have enough reliable evidence to determine value, then the court could appoint its own business valuation expert.

If you’re facing divorce, it’s important to have your assets and debts carefully reviewed and assessed.

The attorneys at Lakeshore Law & Mediation can help. We hire the most experienced valuation experts and are committed to helping you navigate through all legal aspects of your divorce.

Do you have questions regarding your marital estate? We’d love to hear from you. Contact us today!

Be Smart About Finances in Divorce!

Tips for Finances in Divorce from Lakeshore Law and Mediation of Spring Lake MISome marriages are just unhappy. Days of bickering and cold shoulders pile one on top of the next. For some, marriage counseling can offer a new perspective. For others, divorce may be the fresh start they have been seeking.

If you have decided to file for divorce, or you have been shocked by being “served” with divorce papers, you will need to make wise choices as you navigate finances in divorce.

 

7 Points of Financial Wisdom During Divorce

1. Prepare a Budget.  If you have never lived by a budget before, NOW, is the time to sit down and consciously become aware of your monthly bills. There are many online tools to help you prepare a budget, or your attorney can provide you with a schedule of expenses (including recurring and non-recurring expenses).

Since you will incur attorney fees, it is important for you to project the cost to include in your budget as well. Ask direct questions of your attorney as to “how much your divorce will or may cost?”

2. Prepare an Asset and Debt Spreadsheet.  Do you know your financial standing? It is amazing how many people are unaware of their exact financial outlook. Many couples have one person who handles all of the finances while the other person just contributes a paycheck and remains “in the dark” about bottom line.

When faced with divorce, financial knowledge is a MUST. There have been cases where a spouse is totally blind-sided by credit card debt, lack of IRS tax payments, or other financial debacles that significantly affect them for the rest of their lives.

3. Be Aware of your Emotions. In a stressful situation, like divorce, it is difficult to make wise, thoughtfully considered decisions. People who “just give up” or “fight to the death” often regret their decisions later on. “Buyers remorse” is common once the divorce settlement’s ink has dried.

An attorney can help you gain perspective on your financial decisions. It is important to separate emotional reactions from financial results. Your decisions now will  affect you in the long term.

4. Your Children. Children will adjust to the new living situation so long as they are not used as pawns by either one of you to gain either and emotional or financial advantage. Children are the innocent third parties in any divorce. Do not share “adult” topics with them. Assure them that both you and your spouse will always love them. Leave your children out of the controversy. If you need help with this aspect of divorce, seek counseling for yourself.

5. A New “Friend”. While it may be exciting to move on from the old “ball and chain,” having a new love interest may drain your pocket book when you can least afford the luxury.

Also, spending marital money on a new love may alter the final financial outcome of the divorce,  if you are using “marital money” for the benefit of a third party. Watch your step in this arena.

6. Begin Separation of your Accounts. You must be aware of any court orders regarding “dissipation of marital assets.” However, once temporary orders have been established, it is important for you to set up separate accounts, both checking, savings, and credit cards where appropriate.

7. Credit Reports. If you are a person who never checks your own credit report, now is the time to start. My annual credit report allows for you to receive all three major credit reports once per year at no charge. You don’t have to pay extra for your “credit score.” Just get your reports and become familiar with the content of each report. If you need help understanding what they mean, ask your attorney.

 

If you need personal financial advice for your divorce, Lakeshore Law and Mediation is here to help! Simply give us a call at 616.844.4091

How to Handle a Spouses’ Business during Divorce

Marital Business in Divorce - LakeshoreLawandMediation.com

“If my Wife/Husband owns a business, but it is only in his/her name, does that mean they “get” the business if we decide to divorce?”

 

A business that is developed or actively managed during a marriage is USUALLY considered a marital asset.

However, a lawyer must evaluate and assess the answer to the following questions and more:

  • Was there a valid pre-marital agreement that addresses the business interest?
  • Was there a valid post-nuptial agreement that addresses the business interest?
  • Does the business actually have value?

If the business is determined to be an asset of the marriage, then, certain financial information must be studied to determine the “value” of the asset.

Here is a brief list of information that a lawyer will need to determine the value of a business:

  1. Five years of Financial statements
  2. Recent Monthly or Quarterly statements as compared to the same period of the last year
  3. Board of director minutes for the past five years
  4. Profit and Loss statements for five years
  5. Income tax returns
  6. Personal Income tax returns
  7. Accounts receivable with aging schedules
  8. Depreciation schedules
  9. Shareholder agreements
  10. Expense reports
  11. Budgets
  12. Lease agreements
  13. Any appraisals

It may be necessary to hire a “valuation expert” to  determine the value of the marital portion of the business interest.