My Spouse Wiped Out The Account, What Will Happen To My Money?

joint bank account divorce spouseI recently had a client come into my office wanting to get a divorce. Here was my client’s concern. The spouse in question, who apparently knew that a divorce was imminent, wiped out their joint marital account to the tune of $500,000.00. After this discovery coupled with the fact that my client was not informed where the money went, I was asked what will happen?!

Clearly this is a significant issue with respect to equitable distribution. On its face it is hard for a court to equitably distribute an asset that no longer exists when the action is filed. Automatic orders are meaningless as the money is already gone. Rest assured, the Court cannot and will not simply ignore this missing money. The issue for the Court to decide is whether there was any fraudulent intent on behalf of the spouse that took the money. Normally, the Court will not put itself in the position of second guessing every spending decision of the spouse accused of wiping out an account. There are a multitude of reasons a spouse may have when it comes to spending money from a joint account. Granted, in our example, a spouse will be hard pressed to explain how spending $500,000.00 happens in the routine course of daily bills. Where a spouse cannot provide an adequate explanation for what happened to the marital funds which disappeared on the eve of filing a divorce action, the Court will bestow an award based on the missing asset. Or in other words, my client needs not worry. The Court will equitable distribute the $500,000.00. This may come as credit to other assets, or an outright money award.

Rarely are cases so cut and dry. Here is a more typical example. Wife is a partner in a law firm. On the eve of filing the divorce she is fired from the firm. Husband now seeks to have her partnership evaluated as part of the equitable distribution award. The Court will need to look into the facts and circumstances of the wife’s termination at the firm. If the husband cannot show that the cfamily onduct, the firing, was aimed at depriving him of what would normally be distributed in the due course of the divorce action, the practice will not be valued and distributed.

LEARING POINT: If you realize a divorce is imminent, dissipation of marital assets will not be in your best interest. If your spouse does squander assets you will need to show that it was in an effort to cheat you out of what you’re entitled. Hire an attorney and let them advise you as to how best navigate these issues.

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My Spouse Wants A Divorce, Shouldn’t They Pay For It?!

who pays for a divorceA concern that I have been asked about in the last month when giving my free consultation is who pays for the divorce.  Typically, a spouse has been a loving, caring partner who stayed home for years raising children and taking care of the household.  As a result, they lack the financial resources to fully litigate their divorce.

The question becomes, is all lost?! Not necessarily.  First, when a married couple begins the divorce process, generally they are divided into two categories, the monied spouse and the nonmonied spouse.  As you might guess, the monied spouse is the one with the higher income.  You will notice, gender does not play a role in this determination.

Domestic Relations Law §237 provides that there “shall be a rebuttable presumption that counsel fees shall be awarded to the less monied spouse.”  Courts generally attempt to ensure that each party shall be adequately represented and that where fees and expenses are to be awarded, they are to be made in a timely fashion.

How does a court know to give the less monied spouse this award?  A pendente lite motion must be filed.  Granting this motion prevents an imbalance in the parties’ resources from affecting the proceeding’s outcome.  It specifically protects one spouse from dragging litigation out in an attempt to drain resources and outspend their soon to be ex-spouse.

who pays for a divorceShould the monied spouse want to oppose the awarding of such fees, the onus is on them to show why such an award is unwarranted.  Granting attorney fees falls within the sound discretion of the court.  In determining whether or not to grant attorney fees, the court should review the financial circumstances of both parties together with all the other circumstances of the case which may include the relative merit of the parties’ positions.

The court will take into account (1) the parties’ ability to pay; (2) the nature and extent of the services rendered; (3) the complexity of the issues involved; and (4) the reasonableness of fees requested.  The attorneys will file their respective retainer agreements with the court, outlining their fee structure as well as anticipated expenses.

Due to the importance of obtaining fees in a timely matter so as to prevent the monied spouse from wearing down a nonmonied spouse on the basis of sheer financial strength, the courts will generally not defer ruling on this type of motion.  Additionally, depending on the complexity of the case, the court will allow the non-monied spouse to return and request more money should the award be exhausted in the normal course of the litigation.

LEARNING POINT: Seek a Long Island divorce attorney quickly once beginning the divorce process. The attorney will be able to quickly ascertain your potential recovery or liability for attorney’s fees. Filing and or opposing a pendente lite is crucial in the protection of your assets.

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