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Wasteful Dissipation of Assets in Divorce

Money is cited as a leading source of conflict that causes marriages to weaken and decay. Unfortunately, couples’ battles over money, and what constitutes a proper or improper use of it, don’t end when they file for divorce. The principle of “wasteful dissipation” comes up frequently in the course of New York divorces, and, where proven, it can have a serious impact on the equitable distribution of marital assets or the amount of support owed. Read on to learn more about what constitutes wasteful dissipation, and speak to an experienced New York divorce lawyer if you believe your spouse has dissipated marital assets.

Dissipation occurs when a spouse spends or transfers marital assets in an irresponsible or unjustified manner after the breakdown of a marriage, in order to prevent the other spouse from obtaining their share of those assets or to justify an unfair division of marital assets. Spouses may commit dissipation by making irresponsible or frivolous purchases, racking up debt, giving away property, or transferring assets to friends or family so that those assets aren’t identifiable as part of the marital estate by the divorce court.

Courts can intervene to require that assets be legally transferred back to the marital estate, when possible. If the dissipated asset was a piece of property that was lost or sold and cannot be recovered, courts will instead count the value of that asset against the share of the marital estate of the spouse who wrongly dissipated the asset. In other words, if a spouse sold a piece of marital property worth $200,000 and transferred the proceeds outside of the reach of the family court, then that spouse’s share of the remaining marital assets will be reduced by $200,000. That spouse may be required to make payments to the other spouse to make up the value of the asset sold.

Those who believe they have been the victim of wasteful dissipation and are entitled to penalties or a greater share in an equitable distribution of assets will need to prove to the court that:

  • an asset is actually lost, rather than simply transferrable back to the marital estate,
  • the asset was lost or transferred after the marriage had broken down,
  • the accused spouse had control over the asset at the time that it was lost or transferred, and
  • the loss or transfer had no legitimate reason in the context of the marriage or divorce, such as the sale of an asset to provide for the costs of the divorce, or other familial expenses.

If you believe your spouse may have unlawfully dissipated marital assets during your New York divorce, speak with an attorney as soon as possible to determine your rights, and contact the Hudson Valley family lawyers at Rusk, Wadlin, Heppner & Martuscello, LLP for a consultation on your case, in Marlboro at 845-236-4411, and in Kingston at 845-331-4100.

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Kingston Office

255 Fair Street, P.O. Box 3356
Kingston, New York 12402

Phone: 845-331-4100
Fax: 845-331-6930

Marlboro Office

1390 Route 9W, P.O. Box 727
Marlboro, NY 12542

Phone: 845-236-4411
Fax: 845-236-3190

Rusk, Wadlin, Heppner & Martuscello, LLP, is located in Kingston, NY and Marlboro, NY and serves clients in and around Ulster County as well as parts of Orange, Dutchess, Columbia and Greene Counties as well as many surrounding areas.

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