Dissipation and Hidden Assets in a New York Divorce

When a couple makes the decision to divorce, one of the many issues that needs to be determined is how the assets they have acquired throughout their marriage will be distributed between the two of them. The goal is to achieve an equitable distribution. While this may seem as if it would be simple enough, the reality in many divorces is that their process is anything but simple. There are a number of things a spouse may do, such as hide assets, sell assets without the other spouse’s knowledge or approval, or even engage in dissipation (wasting) of assets, all in an attempt to deprive the other spouse of their fair share of the marital estate.

Hiding Assets

In most states, including New York, a temporary restraining order may be placed on both parties at the beginning of a divorce proceeding, especially in a divorce that appears to be contentious or if there is suspicion that the other spouse may engage in unethical and possibly illegal acts. The order prevents either spouse from disposing of any marital assets in any way. Keep in mind, however, a temporary restraining order usually only applies to marital assets and property and not personal property.

It is against the law for a spouse to hide assets from the other and if the spouse is caught, they will have to make restitution to the other spouse. In some cases, the court may even hold the spouse in contempt of court and could even send the spouse to jail, although that is usually only done in extreme cases.

Dissipating Assets

Another way one spouse may try to deprive the other spouse of their share of marital assets is through dissipation. Dissipation of marital assets is when one spouse spends or wastes marital assets in an unjustified manner and to specifically decrease the value of the marital estate.

A common example of wasting marital assets is when one spouse is having an affair and uses marital assets to purchase gifts for their paramour. A spouse may also commit dissipation by irresponsibly selling or transferring marital property without the other spouse’s knowledge.

If the injured spouse can prove dissipation, the court can order the guilty spouse to transfer the assets back to the marital estate. If the assets or property cannot be recovered, the court can count the value of the asset against the guilty spouse’s share of the estate and reduce that share by the asset’s value.

Contact a Hudson Valley Family Lawyer for Help

If you are considering a divorce, having a skilled Rockland County divorce attorney working on your behalf will help ensure you receive your fair share of your marital estate. Call Law Offices of Robert S. Lewis, P.C. at 845-358-7100 to schedule a free and confidential consultation.

Source:

https://www.nysenate.gov/legislation/laws/DOM/236