Court Confirms Importance of Valuation Date in High Asset Property Division
Highly successful couples who go through a divorce often struggle with the financial aspects of high asset property division, often leading to prolonged litigation dealing with the propriety of the family court’s distribution award.
Key Steps in High Asset Property Division
The initial steps in the distribution process are important. These involve:
- Setting the date for classifying assets and liabilities
- Classifying assets and liabilities as marital or non-marital
- Setting dates relevant for valuation of assets and liabilities
- Assigning values to the marital assets and liabilities
As a rule, only marital property and liabilities can be divided between divorcing couples. Non-marital properties are not subject to distribution, which is why the classification of assets, particularly of business owners and successful professionals, is an important step.
If you’re a business owner or shareholder in entities with vast holdings and interests in Florida, it’s to your best interest to speak to an experienced and finance-educated divorce attorney about your situation. An attorney with a good grasp of business and financial concepts can determine the economic value of your tangible and intangible assets.
Appeals Court Reverses Trial Court on Asset Distribution
In a recent case, a Florida appeals court reversed the decision of a trial court on two aspects:
- The valuation date of business interests
- Distribution of post-valuation profits
Valuation of business interests: The appellate court’s ruling stemmed from a divorce case filed by the wife whose husband had ownership interests in 3 companies that operated several restaurants in Florida. The couple had 2 children during the marriage. In distributing the marital assets, the trial court earlier said that the date of valuation for the couple’s property was the date of filing of the petition for dissolution. But in its decision, the trial court used a later date for the valuation of the parties’ business interests, leading the higher court to reverse this ruling.
Post-valuation profits: The trial court as well specifically found that income earned after the valuation was passive, yet it distributed post-valuation profits to the wife. The appeals court reversed this decision stating that because it was generated after the date the divorce petition was filed, the wife should not be entitled to any of the post-valuation profits.
In Clearwater, Florida, the Law Firm For Family Law has managed more than 1,800 cases, including high asset property division. Its founder Gary E. Williams is a board certified expert in marital law who also has an MBA, providing him with an advanced understanding of financial issues that frequently arise in divorce cases.
We invite you to call us today at (727) 531-8737 to learn more about how we can help you.