Squandering the Nest Egg: Dissipation of Marital Assets

What can you do if your spouse is gambling, spending, going into debt, drinking away, or hiding away marital assets during your divorce? Dissipation of marital assets, or intentional waste/depletion of marital property in Florida is a serious concern. It can include excessive spending (outside of what was typical during the marriage), spending related to an extramarital affair, mismanagement of finances (accumulating credit card debt etc.), intentional waste of marital funds or assets, such as through gambling, and asset devaluation (for example destruction of property, withdrawing money from a 401K or withdrawing large sums in cash), diverting funds to friends or family members to shield it from the divorce process.

Florida Courts typically equitably divide all assets and debts acquired during the marriage. However, if it can be proven that one spouse dissipated assets, the court may adjust the division of assets to create a more fair result. The party proving dissipation of marital assets must establish that the assets in question were part of the marital estate; that the actions taken to deplete the assets occurred without the other spouse’s knowledge or consent; that the spending did not benefit the household/marriage; and that the wasteful behavior occurred during the marriage (particularly close to the time of separation). Florida courts can consider dissipation of assets that occurred after filing and within two years prior to filing for divorce, however in limited circumstances the court can look back further.

Potential Remedies

If dissipation is established, there are several potential remedies the court may consider:

• Unequal property division

• An award of 50% of the dissipated amount

• Allocating assets/debts as separate property

• Penalties

• Issuance of an Injunction

  If the dissipation is ongoing, it may be necessary to request that the court freeze certain marital assets during the pendency of the divorce.

  In proving dissipation, having the proper evidence is pivotal. Having the proper legal representation is important. You should monitor all accounts closely and document any questionable transactions. Your attorney may need to conduct further discovery to get a full financial picture and it may be necessary to utilize a forensic accountant to trace hidden assets. Contact Cody Law, PLLC to discuss your specific situation and whether an unequal division of marital property may be appropriate, as well as other remedies, due to dissipation of marital assets.

Double Edged Sword: When a Parent Withholds Time-Sharing

Emotions almost always run high during a divorce or other family law action, especially when child custody is involved. Florida has two elements that make up custody: Parental Responsibility and Time-Sharing. Time-sharing means how many overnights each parent has with the minor children. Recent law changes in Florida mean that the court now starts with the presumption that equal time-sharing is in the best interests of the child. In order to overcome the presumption of “fifty-fifty” a parent must show by a preponderance of the evidence that an equal time-sharing plan would not be in the child’s best interest. But what if there is no court ordered time-sharing in place yet? Can one parent unilaterally withhold a child from the other? Can doing so backfire?

When no time-sharing order exists, typically both parents have equal rights to the child and may both spend time with the child, even if the child is living primarily in the marital home with one parent. While this sounds simple in theory, it often leads to complex and messy situations if both parents are not willing to co-parent pending a formal order. Until a formal order is entered, there is no clear benchmark for who makes decisions, when and where children should be on each day, or what to do if parents disagree. This often leads to one parent withholding the child from the other, sometimes out of retaliation, confusion, or fear. In reality, often one parent has been the primary caretaker and day-to-day decision maker and may, by default, end up making unilateral decisions for the children while the case is pending. Courts often view withholding a child from the other parent as problematic and potentially harmful.

In some circumstances, for instance where there are immediate concerns for a child’s safety, temporary withholding might be defensible. However the actions should be followed by prompt formal legal action. If the witholding is simply based on personal conflict or retaliation by a parent it will likely not be excused by the court. Under Florida’s best interest factors, maintaining ongoing contact with both parents is a priority, absent any serious safety concerns, any interference with that could backfire, leading to various consequences, including:

• Court ordered make-up time

• Loss of credibility in future proceedings

• Court-ordered parenting education

• Court ordered therapy

• Denial of shared parental responsibility

• Potential loss of timesharing on a permanent basis by the withholding parent

Withholding time-sharing is a double edged sword and it is recommended you seek the guidance of an attorney before making a decision to unilaterally withhold time. Obtaining a temporary time-sharing order while your case is pending can protect both parents and offer consistency and stability for the child. Once a formal time-sharing order is entered, both parents have the ability to enforce the order should conflict arise.

What Can I do if the Other Parent is Withholding Our Child?

If the other parent is preventing you from time-sharing, there are several protections available under Florida Law, including:

• Enforcement of an existing parenting plan

• Contempt

• Request for make-up time-sharing

• Petition to establish a permanent or temporary time-sharing plan

• Petition to modify

In the meantime it is important to document all missed time-sharing exchanges, text messages, voicemails or e-mails denying time-sharing, all notes on your attempts to exercise time-sharing, and any other relevant potential evidence.

Having the guidance of counsel is important when it comes to child custody. Your attorney can help you get your message across to the judge, present crucial evidence, negotiate on your behalf and prevent mistakes in judgment while awaiting an order. If you are dealing with the other parent withholding time-sharing from you or if you believe withholding may be necessary, it is important to speak with an attorney right away. Contact Cody Law to discuss your individual situation and see if a legal remedy is available to you.

Five Things To Do After Your Divorce is Final

Once your Final Judgment of Dissolution is entered there are several things you should do right away. At Cody Law we strive to help you navigate through the next steps a create the best possible start for your new life ahead. Here are five steps to take post-divorce.

1. Change your name: If you requested restoration of your maiden name and your final order grants the name restoration, you must take the necessary steps post-final judgment. Obtain a certified copy of your final dissolution right away and take it with you to the Social Security Administration office to report your name change. You will also need to update your license with the Florida Department of Highway Safety Motor Vehicles within ten (10) days after the name change is confirmed with the Social Security Administration.

2. Change your estate planning documents and beneficiary designations: Once the divorce is final, any document which lists your former spouse as your beneficiary will become automatically void under Florida law. If you do intend to leave your former spouse as the beneficiary, you will need to take steps reaffirm your intentions (for beneficiary designations you will need to contact those institutions individually). You should create a new estate plan, including your Will, Trust and advanced directives like your durable power of attorney, health care surrogate, living will and declaration of preneed guardian.

3. Implement a joint calendar: if the final order includes timesharing of minor children with your former spouse, the easiest way to organize timesharing is to create a joint calendar. You can coordinate school schedules, extra-curriculars, planned vacations etc. and know ahead of time if any changes to the regular schedule need to be discussed. Popular calendar options include Google Calendar, Custody X Change, or parenting apps with calendaring features, such as Our Family Wizard.

4. Execute any necessary documents to complete transfer of assets: Depending on what the final judgment states regarding transfer of marital assets, you may need to execute documents such as transfer of title for vehicles or quit claim deeds. If you are recieving funds from a pension or 401K, you may need to have a QDRO (Qualified Domestic Relations Order) completed to receive your portion. Your attorney should guide you regarding what documents need to be executed post-divorce to ensure that all assets are properly transferred.

5. Speak to your accountant: Finally, you should contact your accountant who can advise you regarding any potential tax implications of the divorce. Transfer of property, alimony and dependency exemptions for the minor children may affect your tax filings post-divorce.

Contact our office for more information and to set up a consultation for divorce or any Florida family law matter.

All About Extracurriculars

Parents of minor children who are facing a divorce or paternity matter often ask how to handle extracurricular activities. When seeking a paternity order or a dissolution of marriage with minor children, the end result is that a parenting plan is entered into. The parenting plan can be as detailed as the parties desire and should include as much detail as possible, particularly when there is a potential for conflict down the road. One detail a parenting plan will typically include is a section addressing how extracurriculars are to be handled.

Extracurricular activities are not factored into the calculation of child support. Payment for extracurriculars is addressed separately under the extracurricular provision in the plan. Most parents choose to include the provision that the cost of agreed upon extracurriculars will be split 50/50 between each parent. If there is a disparity in income or the case is contested then the costs of extracurriculars may be split according to the parties’ pro rata share of responsibility for child support.

The provision will typically state that the parents should attempt to agree regarding any extracurricular activities and when the parents cannot mutually agree, then one parent may unilaterally enroll the child during their timesharing and bear the full cost, including associated costs such as uniforms and costumes. A good parenting plan should also detail who will be responsible for transportation to and from each activity. If parents know that a certain activity is going to be a cause of conflict in the future, they can address it in the parenting plan in advance. For example, parents may want to specifically provide for, or limit or restrict travel sports, or sports they consider dangerous. They may also choose to agree on a set limit of how many extracurricular activities a child should participate in each year.

In general, the nature of a lot of extracurricular activities means that practices, lessons or events will occur during both parent’s time. However, parents should avoid unreasonably infringing on the other parent’s time with the child to avoid ending up back in court. When issues arise involving extracurricular activities the court will always consider the best interests of the child in resolving disputes. The best case scenario for parents is setting aside personal differences with the other parent and considering what the child enjoys and wants to participate in, rather than unreasonably refusing to agree on an extracurricular activity.

If you are facing challenges with this issue, or any other family law matter please reach out to Cody Law for a consultation.

Holla “We Want Prenup, We Want Prenup”: Florida Prenuptial and Postnuptial Agreements

A Premarital agreement, known as a prenuptial agreement or “Prenup” is a contract couples sign prior to marriage, to become effective upon marriage to each other. The Prenup can determine what will happen if the couple divorces, including provisions for distribution of assets, debts, alimony, and other issues. A well executed prenup will set forth the terms of the divorce, rather than leaving those terms in the hands of the judge to decide.

A postnuptial agreement “Postnup” is essentially a different means to the same end. The difference is that a postnuptial agreement is executed sometime after the parties have married and there must be separate consideration to make the agreement binding.

Some of the benefits of prenups and postnups are avoiding costly litigation and stress if the marriage ends in divorce. Issues that cannot be decided in a prenup are child custody (in Florida this is known as parental responsibility and timesharing) and child support. These are considered rights of the children in Florida and cannot be waived.

Florida has adopted the Uniform Premarital Agreement Act, which expressly provides that parties may reach a binding contract on issues including:

• the parties’ rights and obligations concerning any assets and debts;

• the right to buy, sell, use, transfer, or dispose of property;

• Distribution of property in the event of separation, divorce or death;

• the right to alimony;

• the making of wills or trusts;

• disposition of proceeds from life insurance;

• Choice of law governing the premarital agreement.

To be valid, the prenuptial or postnuptial agreement must be entered voluntarily, without coercion or duress and must not be unconscionable. There there must have been a fair and adequate financial disclosure beforehand. When entering a prenup or postnup, each party must be separately represented.

If you are contemplating marriage, or already married, and believe you could benefit from a prenuptial or postnuptial agreement, contact our office to discuss the process.