Sometimes, litigating a divorce action can be expensive. In addition to your legal team’s hours spent litigating your case on your behalf, you may also need other experts, like forensic accountants, working on your case. Even if you have substantial wealth, obtaining the liquid assets needed to pay these bills can be complicated. In some cases, resolving this problem may mean selling a major asset. However, once the asset sells, how should the sale proceeds be divided? A recent case originating from Palm Beach County addressed this issue.
The case involved the divorce of a Boca Raton dentist and his wife. The wife filed for temporary alimony, attorney’s fees, and costs. The trial judge instructed the couple to sell a very valuable yellow diamond that they owned in order to cover the fees incurred by the wife’s lawyers and accountants. Specifically, the court ordered the wife to sell the diamond and then take $30,000 from the proceeds to pay her attorneys and another $30,000 to pay her accountants.
The diamond sold, returning a sale price of $142,000. After the first $60,000 went to the wife’s lawyers and accountants, that left $82,000 split equally between the spouses. The judge ultimately decided that, in terms of calculating the couple’s equitable distribution, the sale of the diamond should be credited as $101,000 to the wife and $41,000 to the husband.
The wife disputed this determination on appeal. She argued that the $60,000 from the diamond sale proceeds that she spent on attorneys and accountants should have been categorized as a type of temporary support and not counted against her in the determination of equitable distribution. The wife, in her appellate argument, also argued that her spending $60,000 from the diamond sale proceeds constituted the depletion or diminution of an asset and that the law is clear that, absent misconduct, such diminution or depletion should not count against her in terms of equitable distribution.
In essence, the wife argued that these expenses were the same type as a husband’s expenses in another recent case from the First District Court of Appeal. In that case, the appeals court reversed a trial court ruling that counted against the husband more than $6,000 he spent from two bank accounts paying expenses on the marital home (where the wife lived) as well as his own living expenses.
This case, the appeals court stated, was different from those cases. Nevertheless, the court reversed the ruling and sent the case back to the trial court. The problem was a lack of clarity in the lower court’s order. By counting the full $60,000 against the wife in calculating equitable distribution, the trial judge essentially determined that the wife was not entitled to an award of temporary attorney’s fees and costs. If the wife was not entitled to an award of temporary support, the trial court needed to make explicit findings that she was not entitled to temporary support. If she was entitled to temporary support, the trial court would need to modify what it had decided with regard to equitable distribution.
When your divorce involves substantial assets, your case needs the attention of attorneys experienced in such matters and well-versed in working aggressively toward a fair resolution. The diligent South Florida high-asset divorce attorneys at Stok Folk + Kon have been helping clients for many years in dealing with the unique needs of divorce cases with high-value assets.
Contact us online or by calling (305) 935-4440 to schedule your consultation and find out how this firm can help you protect your interests.
More blog posts:
High-Income Parents and Child Support in Florida, Florida Business Lawyers Blog, Dec. 2, 2016
New Florida Supreme Court Decision Offers Beneficial Information for High-Asset Individuals Contemplating Prenuptial Agreements, Florida Business Lawyers Blog, Jan. 14, 2016