What Are Dissipated Assets in a North Carolina Divorce?
Divorces can cause people to do strange things. Faced with the possibility of handing over a significant portion of their wealth to an ex, some spouses react exceptionally badly. A small percentage of these spouses come to the conclusion that they would rather throw their money away instead of handing it over to their former partner. Obviously, this is highly illogical. But humans are highly illogical beings, and make no mistake - this does happen on a fairly regular basis in North Carolina. So, why do spouses do this in the first place? What are the legal consequences of these actions, and how do you protect yourself against this insane strategy?
Your first step should always be to get in touch with a qualified, experienced divorce attorney in North Carolina. These legal professionals can help you efficiently address this situation. Your spouse can experience significant legal consequences for these kinds of actions, but an effective attorney is required if you want to hold them accountable. Your attorney can also help you with every other aspect of your divorce as you strive for a favorable legal outcome.What are Dissipated Assets?
Dissipated assets are marital assets that have been intentionally wasted or squandered. There are many potential examples of dissipated assets. A classic example is a trip to the casino with the family savings, after which one spouse walks away, having lost virtually everything. Spouses who dissipate assets also do this in the form of gifts. For example, they might give a new girlfriend hundreds of thousands of dollars, or they might give their 15-year-old son an equally substantial chunk of cash. In some situations, spouses even completely destroy assets. For example, a husband might throw their wife’s priceless jewelry into the ocean (yet this has happened before).What is the Point of Doing This?
So, why do spouses dissipate assets? What is the point of throwing away valuable property? Wouldn’t it be more logical to simply allow the equitable distribution process to take place? After all, both spouses receive their fair share after assets have been distributed, whereas both spouses receive nothing after assets have been dissipated. The first and most obvious answer is that people do not always act in a logical manner, especially in the midst of an emotionally turbulent experience like a divorce.
The second answer is more understandable. Some spouses have very high incomes, and they may be content to lose assets completely while knowing they will earn more than enough money within the next year or so. Their goal is to leave their spouse with nothing, even if it means accepting losses of their own in the short term. These spouses know that they have a higher earning capacity than their exes, and they are willing to use this to their advantage.How Courts Define Dissipated Assets
If courts believe that assets may have been dissipated, they will examine the situation closely. In order for a court to determine that assets have been dissipated, several factors need to exist:
- The assets must be marital. If a spouse squanders separate property, the other spouse wouldn’t have had access to those assets anyway.
- The assets must have been lost “upon or after” the breakdown of the marriage.
- The guilty spouse actually controlled the assets when they were lost.
- The loss was not connected with a valid marital expenditure.
Note that intent is not necessarily important when dealing with the dissipation of assets. In other words, a spouse does not need to act vindictively when they lose marital assets during a divorce. If a gambling addict loses the family fortune at a casino during a divorce, arguing that they did not mean to lose the money will not achieve anything. In addition, money seized from illegal operations can also be considered a dissipated asset.How to Stop This From Happening
If you believe that your spouse may dissipate assets during your divorce, you can file an automatic temporary restraining order (ATRO). If the assets have already been scattered, the burden of proof is on them. They need to prove to the court that the loss of assets was a valid marital expenditure. If they cannot do this, they will face serious legal consequences.Enlist the Help of a Qualified Attorney Today
If you have been searching North Carolina for an experienced divorce attorney, look no further than Arnold & Smith, PLLC. Over the years, we have helped numerous spouses in North Carolina finalize their divorces. Although many potential issues can complicate your divorce, we can help you overcome these hurdles. The possibility of dissipated assets may be worrying for many spouses, but there are a number of strategies that can help. Book your consultation today, and we can explore some of these strategies together.