Property Distribution - § 5-4 - § 5-6 (A)
2018---Hvozdovic v. McGuire, Va. Ct. of Appeals, Unpublished, No. 1146-17-4
The trial court did not abuse its discretion in finding that Husband’s payment of the parties’ adult child’s college tuition constituted a waste of marital assets. The evidence established that, although the parties entered into a separation agreement requiring equal input from both parents with regard to their children’s education, the agreement did not obligate either party to pay for the children’s college or graduate school. Nevertheless, Husband unilaterally decided to use a marital asset to make the tuition payments. Additionally, the evidence showed that the parties had been separated for over ten years when Husband made the tuition payments from marital funds, and that Husband was largely absent from the child’s life during the marriage and after the separation. Under these facts, the trial court reasonably concluded that Husband’s payment of the child’s tuition was an attempt to improve his relationship with the child and, thus, the tuition payments were for Husband’s own benefit and for a purpose unrelated to the marriage.
2018---Moret v. Moret, Va. Ct. of Appeals, Unpublished, No. 1286-17-3
The trial court did not err in awarding an equitable distribution credit to Wife based on a finding that Husband had wasted marital assets. During the course of the proceedings, the trial court entered an order that, among other things, prohibited both parties from disposing of or otherwise encumbering any marital assets without the express consent of the other party. Despite the trial court’s order, the evidence demonstrated that, during the proceedings, Husband sold a motorcycle, several tractors, a camper, and cattle for significantly less than what Husband had valued such items on a bank loan application. Although Father attempted to justify his actions by pointing to the parties’ staggering marital debt, he failed to present any evidence to rebut the trial court’s finding that he had wasted marital assets.
2017---Allen v. Allen, Va. Ct. of Appeals, Unpublished, No. 0562-16-4
The trial court did not err in refusing to use an alternate valuation date to determine the value of the proceeds of the sale of Husband’s business where Husband presented evidence that he used the proceeds to pay marital debt and where the trial court found that Husband’s explanation for the use of the proceeds was credible.
2014---Plaisted v. Plaisted, Va. Ct. of Appeals, 0051-14-2
The trial court did not err in finding that Husband wasted marital funds. A party’s use of marital funds for living expenses, court-ordered support payments, and attorney’s fees for the divorce proceeding are valid marital purposes and do not constitute waste. Here, the trial court found that Husband withdrew $193,908.57 from marital accounts after the parties separated in 2011 and that he properly used $54,763.00 of that money toward court-ordered support payments. However, Husband failed to prove that he spent the $139,145.57 balance of those funds for living expenses, legal fees, or to otherwise account for the money.
The trial court did not err in finding that Husband had not wasted funds from a marital IRA during the separation where Husband admitted he withdrew the funds, but testified that he did not receive the full withdrawn amount because it was taxed at a federal rate of thirty-nine percent and penalized by ten percent, and that he used the net balance to pay living expenses and attorney’s fees.
2014---Wroblewski v. Russell, 63 Va. App. 468
The trial court did not err in ordering Wife to reimburse husband $30,000 for his payment of the parties’ tax liability where Wife’s decision to file her taxes separately increased the parties’ tax liability by approximately $92,400. The fact that a spouse has the right under federal law to file separate income taxes does not in any way prevent a state court, in the context of adjudicating a divorce, from considering the deleterious effect of that decision on the marriage.
2013-- Wright v.Wright, Va. Ct. of Appeals, No. 0957-12-2
The trial court did not err when it refused to consider the extent of husband’s post-separation income or other separate assets in determining whether husband unfairly diminished marital assets following the parties’ separation. Where husband could meet the burden of proving that he used marital property for proper purposes, he was under no obligation to spend separate funds rather than marital funds, even though his post-separation resources allowed it.
2012---Neuhs v. Neuhs, Va. Ct. of Appeals, Unpublished, No. 2381-11-3
Where the trial court found that wife had dissipated marital assets subsequent to the parties’ separation, it erred in failing to specifically identify exactly what expenditures it determined to be waste, erred in failing to specifically value those expenditures, and erred in failing to specifically classify those expenditures as marital or separate. Although the trial court noted in its letter opinion that wife’s waste was a factor it considered in awarding husband a larger share of marital property, detailed findings with regard to the waste were necessary. Case remanded for clarification on the waste issues.
2011---Campbell v. Campbell, Va. Ct. of Appeals, Unpublished, No. 1481-10-2
The trial court properly held that husband’s gifts of over $800,000 in real estate to the parties’ children did not constitute waste of marital assets, where evidence revealed husband had planned to give the gifts to the children once they reached adulthood, that wife knew of that plan, that wife didn’t object to the gifts, and that wife actually contributed funds towards those gifts.
2010---Wynn v. Wynn, Va. Ct. of Appeals, Unpublished, No. 2400-09-1
Trial court did not err in awarding husband approximately half of the value of wife’s pension, which wife cashed out during the separation, despite wife’s argument that she had spent the money on living expenses. Once husband established that wife had spent marital money since the separation, wife had the burden to prove that the money was spent for a proper purpose. Wife provided no evidence as to the particular expenses she claimed.
2010---Schuman v. Schuman, Va. Ct. of Appeals, Unpublished, No. 0631-09-4 (April 20, 2010)
Trial court erred in failing to include as marital property subject to distribution the $15,100 in funds that wife removed from a joint account at the time of separation. Although wife testified that she “wrote a couple of checks for marital bills,” she further testified that when she noticed that husband had transferred funds from a Virginia bank account to a Florida bank account at the same time, she became “concerned about what was happening, in terms of money and having enough, because this was just at the point of separation.” She offered no further evidence of the use of the funds. Wife’s expression of concern about finances was not sufficient to meet her burden of proving that she used the withdrawn funds for a proper purpose. Thus, the $15,100 should have been included as marital property and considered in fashioning the equitable distribution award.
2010---Davis v. Davis, Va. Ct. of Appeals, Unpublished, No. 1241-09-2
Trial court did not err in concluding that husband committed waste by cashing three marital CD's and using them to purchase separate property approximately one month prior to the separation of the parties. Despite husband's assertion that he did not cash the CD's and spend the money "in anticipation of divorce or separation," the record established that at the time he cashed the CD's, he had been telling his wife for months that he did not want to be with her, had begun eating his meals and sleeping separately from wife, and was involved in an ongoing sexual and romantic relationship with his paramour. The wasted funds were returned to the marital estate for purposes of equitable distribution.
2009---Cusack v. Cusack, 53 Va. App. 315
Trial court erred in awarding Wife 50% of marital share of Husband's military retirement benefits as of the date of his retirement, which occurred after the parties separated but almost one year prior to Wife filing the divorce complaint and almost two years prior to the equitable distribution hearing. Wife offered no evidence of inappropriate dissipation of the pension receipts, nor any evidence contradicting Husband's testimony that such payments were used by Husband to pay support to Wife under an existing pendente lite order and to maintain life insurance for the parties. Having failed to allege inappropriate dissipation, Wife was not entitled to a retroactive award of the marital share of the payments received by Husband prior to the equitable distribution hearing.
2009---Ovissi v. Salemi , Va. Ct. of Appeals, Unpublished, No. 2112-08-4 (August 25, 2009)
Trial court erred in holding that husband's use of a line of credit taken out on the marital residence to pay for his attorney's fees and "other unknown expenditures" constituted use of marital funds for a non-marital purpose. Use of marital funds for attorney's fees incurred in divorce is not waste (citing Thomas v. Thomas, 40 Va. App. 639). Furthermore, trial court failed to assign values to the amount of attorney's fees, and failed to make a factual determination regarding the nature and amount of the "other unknown expenditures" to determine if those expenditures were "for a marital purpose."
2009---Attiliis v. Attiliis, Va. Ct. of Appeals, Unpublished, No. 1087-08-4 (6/9/2009)
Dissipation occurs where one spouse uses marital property for his own benefit and for a purpose unrelated to the marriage at a time when the marriage is undergoing an irreconcilable breakdown , (citing Clements v. Clements, 10 Va. App. 580 (1990)(emphasis added)). "Dissipation" and "waste" are the same thing, and interchangeable terms. The concept of dissipation does not apply to expenditures which were not specifically for the purpose of depleting the marital estate and where there was no evidence that there was an irreconcilable breakdown of the marriage, (citing Smith v. Smith, 18 Va. App. 427 (1994)).
2005---Jacobson-Kaplan v. Kaplan, Va. Ct. of Appeals, Unpublished, No. 0509-05-1.
The trial court erred in classifying as marital income tax debt incurred by Husband, post-separation. Because the debt was acquired after the separation, the marital funds Husband used to pay it constituted a dissipation of marital property for a nonmarital purpose pursuant to Va. Code §20-107.3(E)(10).
2004---Estate of Hackler v. Hackler, 44 Va. App. 51
Trial court had the authority under Va. Code §20-103(A)(vii) to appoint a conservator to take over husband's accounts and assets for purposes of preventing his further dissipation of the marital estate during the pendency of the divorce case.
2004---Budnick v. Budnick, 42 Va. App. 823
Trial court did not err in finding that husband's use of marital funds withdrawn from a marital retirement account to pay fines and restitution to the victims of his criminal activities was a "substantial waste of marital assets in anticipation of divorce or separation for a purpose unrelated to the marriage, and in derogation of the marital relationship at a time when the marriage was in jeopardy."
2003---Thomas v. Thomas, 40 Va. App. 639
It was not waste for Husband to use marital funds to pay court-ordered pendente lite spousal support. The expenditure of marital funds for items such as voluntary support, living expenses, attorney's fees, and other necessities of life constitutes a valid marital purpose and is not waste.
2002---Mir v. Mir, 39 Va. App. 119
A court need not find waste in order to consider negative contributions in fashioning an equitable distribution award of marital estate.
2002---Northcutt v. Northcutt, 39 Va. App. 192
In order to alter the evaluation for an equitable distribution award under Va. Code §20-107.3(E)(5), there must be a showing of use of the marital property for the benefit of one spouse and for purposes unrelated to the marriage in anticipation of divorce or separation and at a time when the marriage is in jeopardy. p. 197.
Husband did not commit waste by using marital funds to pay spousal support, the daughter's college tuition, etc. p. 199.
1994---Smith v. Smith, 18 Va. App. 427
To challenge a party's use of marital funds as dissipation or waste, the challenging party has the burden of showing that the use of the funds was "in anticipation of divorce or separation...and at a time when the marriage was in jeopardy." In this case, the Court of Appeals refused to extend this definition to include expenditures made for a fifteen-year extra-marital affair that occurred prior to the separation of the parties, without a showing that expenditures were made for the specific purpose of depleting the marital estate or a showing that an irreconcilable breakdown of the marriage existed at the time of the expenditures. Furthermore, the trial court did not err in holding that wife produced insufficient evidence to prove that husband's post-separation adultery involved the waste of marital funds. Although husband admitted that his paramour accompanied him on some post-separation business trips, he testified that some of the trips were reimbursed business trips. Wife's evidence failed to show which post-separation trips involved husband's paramour and of those that did, whether they were reimbursed as business expenses or paid with marital funds.
1993---Stratton v. Stratton, 16 Va. App. 878
Husband was not guilty of dissipation or waste of marital assets in anticipation of separation where he purchased with separate funds land originally held by his marital business, thereby converting the land itself to separate property. Husband gave adequate consideration for the purchase, and there was no evidence that the transaction was fraudulent. The business was a corporation, and the real estate was but merely one asset that the corporation was entitled to convey. Husband’s cash payment of separate funds to the marital corporation in exchange for the land did not cause any diminution in the corporation’s value, and thus, no dissipation or waste occurred.
1990---Clements v. Clements, 10 Va. App. 580
If marital funds are spent after separation, there is a presumption of dissipation. Burden is on party spending funds to establish they were used for living expenses or some other proper purpose.
1988---Booth v. Booth, 7 Va. App. 22
The use of marital funds by wife to pay legal fees for the pending divorce action and to support herself and the parties’ child did not constitute “waste” of the marital estate.
2014---Anthony v. Skolnick-Lozano, 63 Va. App. 76
In a divorce case, a circuit court does not have the authority to declare a resulting trust.
2011---Prizzia v. Prizzia, Va. Ct. of Appeals, Rec. No. 1343-10-2
While issues of subject matter jurisdiction may be raised at any time by the parties or by the court sua sponte, the statutory elements that turn subject matter jurisdiction into active jurisdiction may be waived if objections thereto are not properly made and preserved. Va. Code §20-96 grants a circuit court jurisdiction over suits for divorce. In a divorce case, Va. Code §20-107.3 further provides the trial court with the authority to make an equitable distribution of the parties’ marital estate, provided that certain prerequisites set forth in Va. Code §20-107.3(A) are met. If a party does not object to the trial court’s authority to make an equitable distribution award based on an alleged failure to satisfy the prerequisites of Va. Code §20-107.3(A) in a particular divorce case, that party has waived the right to raise that objection on appeal.
2007---Brown v. Brown, Va. Ct. of Appeals, Unpublished, No. 1676-06-2
Trial court had jurisdiction under Va. Code §20-107.3(K) to reinstate case on the docket in order to effectuate and enforce its rulings from 2002 equitable distribution and to correct any discrepancies in a 2003 decree.
2007---Miller v. Miller, 2007 Va. App. Unpublished, 212
Trial court did not err in refusing to re-open an equitable distribution decree. Neither party requested that the trial court retain jurisdiction over the equitable distribution and Husband failed to timely request an equitable distribution hearing during the twenty-one day period following entry of the decree during which the trial court retained jurisdiction over the case.
2005---Cabaniss v. Cabaniss , 46 Va. App. 595
While a court with in rem jurisdiction may enter a divorce decree, personal rights, which include property and support rights in divorce cases, may not be adjudicated by a court lacking in personam jurisdiction.
2004---Boedeker v. Larson, 44 Va. App. 508
The Uniformed Services Former Spouses’ Protection Act (USFSPA), 10 U.S.C. §1408, permits state courts to divide disposable retired or retainer pay of members of the armed forces in accordance with state law. The act does not grant state courts the power to divide military retirement pay that has been waived for purposes of receiving veterans’ disability benefits.
A court's jurisdiction to award equitable distribution is dependent upon a timely request by a party. Va. Code §20-107.3 specifies neither the form nor the substance of a request. It is sufficient that a party make known to the court his or her desire that the court award equitable distribution.
2000---Patel v. Patel, 33 Va. App. 776
A trial court's order stating that it would retain jurisdiction to make an equitable distribution award for a time certain was not made for the purpose of removing the case from the docket, but with the intent of limiting its jurisdiction.
1998---Toomey v. Toomey, 251 Va. 168
Husband obtained divorce in Virginia. Trial court had no jurisdiction over equitable distribution where out of state Wife was personally served and did not move for equitable distribution until after divorce granted.
1997---Wilson v. Wilson, 25 Va. App. 752 (1997)
After twenty-one days, when no appeal is taken, a trial court lacks the authority to substantively modify an order equitably distributing pension benefits, irrespective of any subsequent agreement by the parties to the contrary. The jurisdiction of the court cannot be established by consent.
2016---Shuler v. Shuler, Va. Ct. of Appeals, Unpublished, No. 0082-16-3
The trial court did not err in valuing Husband’s business based on Wife’s evidence. Although Wife had very limited involvement with the company, she testified regarding the value of the company and provided documentary evidence to support her opinion. In contrast, although Husband testified extensively regarding the business’ history, daily operations, and future, he failed to present any evidence of business’ value. Thus, the only evidence of the businesses’ value was provided by Wife.
2014---Hugh v. Hugh, Va. Court of Appeals, Unpublished No. 1417-13-4
The trial court erred in failing to classify and value the parties’ interest in Husband’s business because of “insufficient evidence upon which to place a value on [the business].” Although the parties have the burden of bringing forth sufficient evidence for the trial court to base its award, where there is sufficient and credible evidence as to the value of a business, the trial court must assign a value to the business when making its equitable distribution award. The trial court in this case had a relative wealth of information regarding the business, including expert testimony, Husband’s testimony, tax returns, financial statements, bank statements, invoice and purchase orders, and deposition transcripts. Although the trial court had doubts as to Husband’s credibility and the limited basis for the expert’s opinion, it nonetheless had sufficient information to assign a value to the business.
2014---Plaisted v. Plaisted, Va. Ct. of Appeals, 0051-14-2
The trial court did not err in valuing Husband’s interest in real property based on a listing agreement introduced into evidence by Wife. The party moving for equitable distribution bears the burden of proof on the valuation of property. When a party with the burden of proof on an issue fails for lack of proof, he cannot prevail on that issue. Although Code of Virginia § 20-107.3(A) requires the trial court to classify and value all of the parties’ real and personal property, the court may, without violating the statute, make a monetary award without classifying or valuing every item of property where the parties have beengiven a reasonable opportunity to provide the evidence necessary to prove classification or valuation, but through their lack of diligence, have failed to do so. Here, because Husband failed to provide the court with any evidence of the property’s value, the trial court was entitled to infer from the listing agreement that the parties’ asking price for the property was credible evidence of the property’s value.
2014---Cavallo v. Cavallo, Va. Ct. of Appeals, Unpublished, No. 0981-13-4.
Wife claimed that she was entitled to 50% of the net increase in value of Husband’s separate property during the marriage pursuant to the parties’ premarital agreement. In order to show the net increase in the value of Husband’s separate businesses during the marriage, Wife’s counsel presented evidence through Husband’s accountant of the “total assets” of the businesses for the relevant years. Husband’s accountant did not provide an expert valuation of the businesses nor give an opinion that the “total assets” of the businesses represented the net value of the businesses. Wife’s valuation approach was flawed because it failed to consider the liabilities of the businesses.
2013-- Patel v. Patel, Va. Ct. of Appeals, No. 0875-12-2
The circuit court did not err in declining to find a negative value for several marital assets for which the marital debts exceeded the marital value. Where the marital debts of an asset exceed the marital value of an asset, the marital value of the asset for purposes of equitable distribution is zero.
2013-- Patel v. Patel, Va. Ct. of Appeals, No. 0875-12-2
The circuit court did not err in declining to apply a fractional discount to reflect Husband’s percentage of ownership in several companies. The relevant value of an asset under Code of Virginia §20-107.3(A) is the intrinsic value of the property, not the value of an owner’s percentage of ownership.
2013-- Wright v.Wright, Va. Ct. of Appeals, No. 0957-12-2
The trial court did not err when it used the “bottom-up” approach in determining the marital value of husband’s association with his law firm. This methodology compared husband’s average income for three years to that of a peer group. The difference between the husband’s income and the average equaled the excess earnings attributable to husband’s association with his particular firm.
2013---Collins v. Collins, Va. Ct. of Appeals, Unpublished, No. 0862-12-4
The trial court erred in failing to value the husband’s business, a marital asset, where he presented evidence of the business’ gross income. In valuing a business during the equitable distribution phase of the case, the trial court must determine from the evidence the value which represents the business’ intrinsic worth to the parties. The factors in Internal Revenue Ruling 59-60 guide the court in making such determination, including the history of the firm, the nature of the company, the outlook for the industry, the book value of the stock, the size of the block to be valued, the earning and dividend-paying capacities of the company, and the existence of goodwill or other intangible assets.
2012---Jones v. Jones, Va. Ct. of Appeals, Unpublished, No. 2086-11-3
The trial court did not err in determining the lost rental value of a small house based on the monthly rent received by a prior tenant, despite the fact that the current tenant occupied the property rent-free.
2011---Pascarella v. McCoy, Va. Ct. of Appeals, Unpublished, No. 0485-10-1
The requirement that the Court value property before dividing it between the parties, pursuant to Va. Code §20-107.3, did not apply where the parties stipulated that the distribution of an LLC formed during the marriage would be controlled by the operating agreement of the LLC rather than the equitable distribution statute.
2010---Dunfee v. Dunfee, Va. Ct. of Appeals, Unpublished, No. 0870-10-4
Trial court did not err in accepting husband’s valuation of the marital residence, which he based in part on market research into comparable neighborhood sales in the six months prior to the hearing and in part on a prior admission by wife that the property was worth husband’s asserted value. Despite wife’s contention that, as sole owner of the property, her opinion as to the value was entitled to greater weight, her evidence regarding value consisted only of the most recent tax assessment and market research that she performed more than ten months prior to the hearing.
2010---Wynn v. Wynn, Va. Ct. of Appeals, Unpublished, No. 2400-09-1
Trial court did not err in refusing to value or equitably distribute husband's business where the parties presented insufficient evidence as to the value or classification of the business. Although the court heard testimony regarding the date the business started, the fact that the business had only just begun to profit, and evidence regarding the purchase price of inventory, the value of equipment, and the gross sales, the court did not err in concluding that "based on the economy, it's too speculative to give wife anything as to the company."
2010---Tucker v. Wilmoth-Tucker, Va. Ct. of Appeals, Unpublished, No. 2008-09-2
Trial court erred in failing to classify as either marital, separate, or hybrid property a $30,000 home equity credit line that wife took out on the marital residence during the separation of the parties, and erred in failing to consider that debt when valuing the marital residence, instead relying solely on the assessed value.
2010---Leake v. Taylor, Va. Ct. of Appeals, Unpublished, No. 0737-09-4
Trial court did not err in valuing equity in marital residence as the value of the residence less the debt owed at the time of trial, despite fact that wife had refinanced the mortgage prior to the separation and received $82,000 in cash as a result. Although husband produced evidence of payments of mortgage principal with marital funds after the refinance, he failed to produce evidence of the value of the home or the balance of the mortgage at the time of the marriage, and failed to produce evidence of payments towards mortgage principal between the date of marriage and the date the mortgage was refinanced.
2009---Howard v. Howard, 2009 Va. App. Unpublished, 116
Trial court did not err in valuing the equity in the marital residence at $55,000, despite the fact that Husband had recently sold the residence and received only $24,436 in net proceeds. Although Husband sold the property for $155,000, the trial court was not required to accept the proceeds from that sale as the value of the equity in the home, given the fact that a cash offer of $175,000 had previously been rejected.
2009---Biernot v. Biernot, 2009 Va. App. Unpublished, 88
Trial court did not err in using an expert appraiser's assessment of the total value of property together with a city assessment's proportional division of the value of the land alone in relation to the total value of the property in determining Husband's separate interest in the property. Court classified the land as Husband's separate property and the improvements on the land as marital property. Because the expert appraiser did not assign a value to the improvements when computing total value, the Court was entitled to rely on evidence of the city assessment's determination of the separate value of improvements in order to determine the appropriate percentage of Husband's separate interest.
2007---Hosier v. Hosier, Va. Ct. of Appeals, Unpublished, No. 0767-06-1
Trial court did not err in refusing to apply the Brandenburg formula for calculating Wife’s separate interest in the marital home, and instead relying upon a “net percentage gain” formula for valuing that interest. The formula determined the percentage gain by comparing the purchase price to the net proceeds of the sale, and then increasing wife’s separate contributions at the time of purchase by that percentage gain in value. In doing so, the trial court properly recognized the role of wife’s separate property used to purchase the asset as well as the role of marital property used to hold the asset during marriage, including debt maintenance, insurance premiums, and real estate taxes. In this way, the court balanced the financial expectancies related to capital acquisition costs (supported by wife’s separate interest) and asset retention costs (supported by marital assets).
2007---Becker v. Becker, 2007 Va. App. Unpublished, 135
Trial court did not err in refusing to award Wife a share of Husband's deferred compensation based on his ownership interest in his company because the court adopted a valuation of Husband's ownership interest which already took into account the value of Husband's deferred compensation as defined by the company's employment agreement with Husband.
2007---Motley v. Motley, 2007 Va. App. Unpublished, 133
Trial court did not abuse discretion by accepting the appraiser's value of the marital home rather than the tax assessment value.
2006---Robbins v. Robbins, 48 Va. App. 466
Case remanded to value marital home using "the most current and most accurate information available which avoids inequitable results."
2004---Hoebelheinrich v. Hoebelheinrich, 43 Va. App. 543
In Virginia, courts look to the intrinsic value of property to measure value for equitable distribution purposes. The intrinsic value of a business may include goodwill, which is defined as the “increased value of the business, over and above the value of its assets, that results from the expectation of continued public patronage.” As a matter of law, goodwill attributable to personal characteristics is considered separate property and goodwill attributable to a business entity (assuming the entity itself is marital) is marital property. However, the existence of goodwill is not fixed as a matter of law, nor is the method of its valuation. Thus, a trial court’s valuation of goodwill will not be disturbed if it appears that the court made a reasonable approximation of the goodwill value based on competent evidence and the use of a sound method supported by that evidence.
Trial court did not err in refusing to accept husband’s testimony as to the “replacement value” of certain household goods, despite the fact that his testimony was the only evidence presented regarding the value of the goods, and was unchallenged by wife. Although the cost to replace an asset under present conditions is some evidence of an asset’s present fair market value, replacement cost is not the legally controlling definition of value.
2004---Hoebelheinrich v. Hoebelheinrich, 43 Va. App. 543
A trial court has broad discretion to determine the value of assets. The burden is on the parties to provide the trial court sufficient evidence from which it can value their property. Further, the trial court determines the weight and credibility to afford the evidence presented to it.
2003---Owens v. Owens, 41 Va. App. 844
Trial court did not err in refusing to apply a “minority interest discount” to husband’s 50% ownership interest in a family corporation for purposes of valuing his shares for equitable distribution. The “intrinsic value” approach, when applied to stock in a family owned company, requires consideration of particular facts and circumstances beyond otherwise objective criteria commonly used in open market transactions. In this case, husband and his brother were equal owners in the business, and no evidence suggested that the brother had ever used his position as office manager to exert authoritarian control of the company or in any way affect husband’s share of the profits, nor did the evidence suggest that the brothers had ever disagreed as to the strategic direction of the company or the management of its finances. Furthermore, the court noted that, should the brother ever attempt to exert such control or affect husband’s share of the profits, several partnership-law remedies would be available. Given the absence of any suggestion of actual oppression relating to husband’s alleged minority status, coupled with the availability of judicial remedies for potential oppression, husband was not entitled as a matter of law to a minority discount for purposes of valuing his shares in the business.
Trial court did not err in refusing to apply a marketability discount to husband’s shares in a family owned business. A marketability discount presupposes a probable sale of stock. Where a sale is improbable, the discount need not be applied. Here, husband and his brother were equal owners in the business, and husband testified that he would only sell his share of the business to a third party in the event that he had no other way to satisfy a potential equitable distribution award. Furthermore, husband offered no evidence that alternatives to sale, such as acquiring a loan, were unavailable to him.
Trial court did not err in refusing to consider, for purposes of valuing husband’s family owned business, the potential capital gains tax liability that would result if husband were to sell his share in the business to satisfy an equitable distribution award. Although Va. Code §20-107.3(E) requires the court to consider the potential tax liabilities to each party when distributing marital property, a party asserting that potential capital gains taxes should be considered for purposes of valuing the property pursuant to Va. Code §20-107.3(A) must prove the probability of an actual, not merely hypothetical, sale of the asset. This principal is no more than the application of the maxim that “valuation cannot be based on mere guesswork.”
2003---King v. King, 40 Va. App. 200
It is generally recognized that opinion testimony of the owner of property, because of his relationship as owner, is competent and admissible on the question of the value of such property, regardless of his knowledge of property values. It is not necessary to show that he was acquainted with the market value of such property or that he is an expert on values. He is deemed qualified by reason of his relationship as owner to give estimates of the value of what he owns.
2001---Holden v. Holden, 35 Va. App. 315
On remand from the Court of Appeals, a trial court is still required to value property using the most current and accurate information available. Where an asset subject to equitable distribution is retained by one of the parties for a period of time after valuation but before the actual distribution, and the asset significantly increases or decreases in value during that time through neither the efforts nor the fault of either party, neither party should disproportionately suffer the loss or benefit from the windfall.
Trial court erred when, on remand from the Court of Appeals, it altered its original distribution of marital property such that husband was disproportionately assigned a loss in the value of certain stock that had occurred while the equitable distribution award was on appeal. The trial court originally ordered that the stock be divided in kind. Pending appeal, the stock lost value due to market factors. On remand, the trial court refused to revalue the stock to account for the loss in value, and instead relied upon the value as of the time of the original trial when reapportioning the equitable distribution award. As a result, husband was forced to bear the entire loss of value.
2000---Howell v. Howell, 31 Va. App. 332
Trial court's valuation of Husband's partnership interest in law firm goodwill upheld on appeal. The value of property is a question of fact, not law.
1998---Arbuckle v. Arbuckle, 27 Va. App. 615
Tax consequences associated with sale of dental practice do not affect value of practice, but may be considered by court in making award.
1998---Martin v. Martin, 27 Va. App. 745
Trial court reversed for not using the Brandenburg formula for determining allocation of increase of value of hybrid property.
1996---Frazer v. Frazer, 23 Va. App. 358
Trial court's reliance on Husband's valuation expert, the company's Certified Public Accountant, is upheld on appeal.
1995---Lee Gardens v. Arlington County Board, 250 Va. 534
An individual unqualified to obtain a real-estate appraiser’s license is not qualified to testify as an expert witness as to the value of real estate. Va. Code §54.1-2011 prohibits, subject to specifically enumerated exceptions, anyone, including a licensed real estate broker who does not have a real estate appraiser’s license, from testify for compensation about the value of real estate in any court proceeding.
1995---Snyder v. Snyder, Va. Ct. of Appeals, Unpublished, No. 2147-94-4
Trial court did not err in accepting husband’s valuation of property and rejecting the expert opinion of a real estate appraiser who testified on wife’s behalf, where cross-examination of the expert established the expert’s unfamiliarity with the subject property and errors in the expert’s report. Although expert testimony may be the preferable method for valuing marital property, the finder of fact is not required to accept as conclusive the opinion of an expert. (Citing Lassen v. Lassen, 8 Va. App. 502 (1989))
1993---Thomas v. Thomas, Va. Ct. of Appeals, Rec. No. 1843-92-2 (UO)
Where one party alleges the dissipation of marital assets, equity can only be accomplished if the party who last had the funds is held accountable for them. Once the aggrieved spouse shows that marital funds were either withdrawn or used after the breakdown of the marriage, the burden rests with the party charged with dissipation to prove that the money was spent for a proper purpose, (citing Clements v. Clements, 10 Va. App. 580 (1990)).
Because the husband was unable to offer sufficient proof that the proceeds were used for a proper purpose, the trial judge correctly valued the settlement proceeds at a date other than the date of the evidentiary hearing so as to achieve an equitable result.
1993---Stratton v. Stratton, 16 Va. App. 878
Trial court did not err in refusing to accept husband’s expert’s valuation of a business. While expert testimony is preferable for valuing marital property, it’s not necessarily dispositive. Though husband’s expert testified that the business had no value, wife presented contrary lay evidence regarding the value of the business, demonstrated the financial history of the business, and demonstrated that the business had generated the primary source of income for the parties during the marriage.
1992---Gaynor v. Hird, 15 Va. App. 379
A tenant in common is entitled to the fair rental value of property occupied by other party. Va. Code §8.01-31.