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A case of complex asset division in high asset divorce

On Behalf of | Jan 6, 2014 | High-Asset Divorce |

A recent appellate court decision may impart valuable advice to Washington residents wanting to prevent protracted dispute over complex asset division during divorce. The litigants were a couple who executed a prenuptial agreement to exempt all gifts, inheritances and personal business profits from equitable property division in the event of marital dissolution. During their marriage, the woman quit her career to stay home with the couple’s four children, and the man built a telecom business that became successful within a year of their high asset divorce. When he later defaulted on court-ordered spousal and child support payments of more than $4,500, the ex-wife went back to court. Her ex-husband pleaded lack of income caused by no longer having an ownership interest in the company and subsistence solely on gifts from his former business partner and in-laws.

Nevertheless, the court rejected those claims because of his opulent lifestyle that included expensive vacations and luxury automobiles financed by his company several years after his purported termination. A trial court awarded the woman the family home and ordered the man to pay his wife the more than $145,000 he owed in unpaid obligations.

The ex-husband argued in another hearing that the prenuptial contract excluded business assets acquired by his independent efforts from marital property division. Appellate judges upheld the trial court’s finding that applying prenuptial agreement terms was not fair because the ex-wife had relinquished outside employment to raise their four minor children.

This case illustrates that despite a pre-existing prenuptial contract, domestic relations courts have broad discretion to include 401(k) retirement plans, pensions, offshore account funds, real estate and business profits in equitable property division. That is why a divorce lawyer may be critical to facilitate fair asset valuation and distribution during marital dissolution.

Source: Forbes, “The High-Flying Debtor Gets His Wings Clipped In Newcomer“, Jay Adkisson, December 28, 2013