Marital Waste

What is Waste?

In the property settlement process, each spouse must disclose his or her individual assets and debts. These disclosures are then used to determine the equitable distribution of property. If one spouse has dissipated marital property for a purpose not in the furtherance of the marriage, then in the property settlement, that spouse’s share of the property may be reduced by the value of the wasted property.

Expenses

Marital waste includes only intentional dissipations of assets that further a purpose unrelated to the marriage, especially if the expenses occur after the marriage has begun to break down. This may include expenditures to fuel a gambling habit, the costs of a drug addiction, or money spent on extramarital affairs. It can also include money sent to extended family members or legal fees resulting from one spouse’s criminal activity.

Neglect

Sometimes, the costs of marital waste result from the neglect of assets. If one spouse fails to make mortgage payments on the couple’s house or other property, this neglect may result in foreclosure and the loss of the home.

Business losses are another significant area in which one spouse’s neglect may cause considerable marital waste. A family-owned business must keep functioning throughout the divorce process. This means that the owners must continue to generate income, pay employees and debts, and continue operations, notwithstanding the difficulties of working with a divorcing spouse. If one spouse allows the divorce to affect the viability and value of a family-owned business, this may constitute marital waste.

What Is Not Waste?

Waste does not, however, include depletions of wealth resulting from bad investments, selling assets to pay the couple’s bills, or other wasting of funds made in furtherance of the marriage. There may still be dissipation of assets, but it is not marital waste if assets are depleted for marital purposes. Even expenses incurred during the pendency of the divorce are not marital waste as long as they are for living expenses, support, the litigation costs of divorce, or similar purposes.

Timeline

In determining which expenses constitute marital waste, courts must consider waste that occurred up to two years before filing the petition for divorce. However, there is nothing preventing the court from considering waste that happened even earlier. In determining the property settlement, courts must consider any factors necessary to do equity and justice between the divorcing spouses, and earlier waste may fall into that category. But the court has discretion whether or not to consider waste that occurred prior to the two-year mark.

Achieving a fair property settlement is a key part of a successful divorce, and an experienced attorney can help you to understand how issues such as marital waste can affect the division of property. If you are considering a divorce, please contact the dedicated West Palm Beach family law attorney William Wallshein for a free initial consultation.