Whether a spouse has dissipated marital assets can be a pivotal issue in disputes under the Maryland Marital Property Act.
This act requires the court to (1) determine all marital property (property no matter how titled acquired by one or both parties during the marriage and all property owned as tenants by the entireties, except property excluded by valid agreement) and (2) value all marital property owned by each of the parties. In step 3, the Court may grant a monetary award based upon the eleven factors set forth in section 8-205 of the family law article. The monetary award may be made only from marital property and only up to the value of marital property owned by the spouse that has to pay.
“ Once dissipation has taken place, the victim needs to assemble the evidence to prove both what has occurred and wrongful intent.
This process can become even more complex when property that once existed is no longer in existence, often under suspicious circumstances. If the court finds that property was intentionally dissipated in order to avoid inclusion of that property from consideration of a monetary award, it will be considered a fraud on marital rights. As such, the court will declare the missing property to be “extant”. Even if it cannot be located or has been dissipated, the court will treat it as existing and in the possession of the fraudulent party. This usually has the effect of increasing the monetary award to the defrauded party.
Heger vs. Heger is a 2009 decision that involved husband, a disabled Anne Arundel police officer, who had drawn down the equity of a home held in his name alone. The court held that dissipation had not been proven. Husband had used the money to pay credit cards, car loans, maintenance on the home and purchase furniture to replace what wife had taken. Other factors that the court considered were the prior practice of the parties in using equity credit lines. The court ruled that wife had not met her burden of proving that husband’s principle purpose was to reduce funds available for distribution.
As a Maryland divorce lawyer who has assisted clients in prevailing on this issue, it is important to remember the importance of preventing dissipation before it occurs. Once dissipation has taken place, the victim of the fraud needs to assemble the evidence to prove both what has occurred and wrongful intent.