Divorce can sometimes be a fractious, conflict-laden ordeal that causes people to do crazy things. In an effort to seek revenge on the other party, people are often willing to make poor choices that can have difficult consequences. The dissipation of assets occurs when one spouse spends a significant amount of marital money for a purpose that does not support the marriage when it is clear that the marriage is coming to an end.
However, when a couple is married, their salaries and other forms of income can be considered marital property. The intention behind dissipation of marital assets is usually to diminish the amount of funds available during the property division process in the divorce.
Some examples of dissipation of assets might include:
- One spouse decides to take an expensive vacation and invites all of his or her friends, and then pays the way for those guests – including things like meals, drinks, special excursions and souvenirs; or,
- One spouse decides now is the time to take that trip around the world by him or herself, even though that trip costs $50,000.
- One spouse starts making big-ticket purchases – cars, vacations furniture – for a “friend.”
- One spouse “gives” a considerable sum of the couple’s money to his or her sister or brother.
- Money is suddenly missing from accounts, with no explanation as to what happened.
How the courts might react
The court requires both parties to submit financial disclosures as part of the divorce filings. If the court finds that one of the parties has dissipated marital assets, is hiding assets, or had intended to defraud his or her spouse in the taking of the marital funds, that person may end up receiving a smaller share of the assets in the divorce when the amount that was dissipated gets factored in. In a case when a wife accuses her husband of dissipating marital assets, the wife must be able to show how the husband spent the funds for personal gain.
In Maryland, the court uses the equitable distribution model to divide marital assets in divorce. While the court makes every effort to divide the assets fairly between the spouses, it is not always divided equally in half. In cases such as the dissipation of marital assets, the court counts whatever amount was dissipated as if it still existed when they divide the estate. The party who was found to have dissipated funds will lose out in the end.
A knowledgeable Maryland divorce attorney from the family law firm of Cynthia H. Clark & Associates, LLC puts their more than 30 years of combined experience to work on your behalf to make sure that you get the most favorable divorce settlement possible. Contact us to reserve a consultation to discuss your case in our Annapolis office today.