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Divorce: The Great Asset Chase

In divorce proceedings, it is not uncommon for a spouse to deny the ownership of certain assets or funds as a means of avoiding paying fees associated with them. At least, that's what happened in a recent divorce case that made its way to Florida's 4th District Court of Appeal.

After 17 years of marriage, a man left his wife to live with another woman and filed for divorce. It wasn't long before financial complications began to arise. As reported in the Florida Record, the wife was displeased with the trial court's decision that the approximate $1,000,000.00 worth of stocks in the husband's name was non-marital. The wife was also displeased with the trial court's decision that both she and husband were responsible for paying unsecured debt to a third party from the sale proceeds associated with an apartment that belonged to her and her husband. 

 

When families (stealthily) move assets among members

The problems stemmed from the involvement of additional family members in the couple's finances. Namely, the husband's father had done some financial maneuvering to protect his own estate. He had, it seems, put his own stocks in the husband's name during the marriage, so that he could avoid paying taxes on it. During divorce proceedings, the husband tried to explain that the stocks were the father's--to no avail. 

"It's actually pretty common," said the wife's appellate lawyer. "I've observed this many times where family members in many ways pull and control assets...assets are alleged to belong to one family member when convenient for one piece of litigation, and then they say it belongs to someone else for different purposes."

In this case, the father's stocks were on a sort of legal carousel. The father passed ownership to his son during the marriage. The husband, when divorcing, tried to pass it back to his father (or, more accurately, claim it was never his). Unfortunately, the horse stopped with them. 

Why this is pertinent

Such entanglements are not uncommon. Parents and other family members often gift assets to their married children, or list assets under their children's names for tax purposes. In some instances, the married child or couples may not even be aware what's alleged to be theirs.

Lawyers, of course, can help sort out such issues. In the present case, the wife's appeal was successful: the appellate court reversed earlier decision--the stocks were marital assets to be divided between husband and wife.  The appellate court also reversed the decision on the unsecured debt and found that the couple was not  obliged to pay an unsecured debt to husband's father with the sales proceeds from  the apartment titled in both husband's and wife's names. (The court also assented to the wife's request that permanent alimony be considered.) Yet often enough, entering divorce proceedings with a full awareness of assets can help couples avoid such scenarios in the first place. 

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