Okay, we all get it. The economy sucks. For many, this translates to a perpetual aversion for the stock market and slashing luxuries once taken for granted (i.e. at home manicures and discounted tee times). For those facing divorce, however, it can be an entirely different ball game. In most instances, the minute divorce appears in a person’s stream of consciousness, a compelling desire to blame the other party is not far behind. Suddenly, terms like “financial mismanagement" are fanning the flames of blood-thirsty spouses determined to hold his or her beloved accountable for their now exhausted nest egg.
If this scenario sounds vaguely familiar, please allow me to intervene and offer these words: HOLD UP, WAIT A MINUTE… no, I’m not channeling Family Force 5 (or Dr. Dre depending on your musical taste). My mantra is always knowledge equals power. When dealing with divorce, it can save countless resources and leave the parties looking at the situation like a business transaction rather than trying to play a highly emotional game of cat and mouse. In this instance it is important to note that misconduct is not proven through mismanagement or simple squandering of marital assets in a manner of which the other spouse disapproves. Rather, there must be a specific finding of intentional misconduct based on evidence showing that the martial funds were used for one party’s own benefit and for a purpose unrelated to the marriage at a atime when the marriage is undergoing an irreconcilable breakdown.
For example, expenditures and investment decisions not rising to level of misconduct will not normally support unequal distribution of assets in a divorce. That means even if your significant other blew your kid’s college fund on a hedge fund tip from the guy that cuts his hair or lost your equity line of credit in a high stakes poker game, while he may be an idiot, he’s not going to be held responsible for the waste or dissipation of marital funds. It is also important to note that if misconduct can indeed be proven, it must have occurred within the past two (2) years before filing when the marriage was undergoing an irreconcilable breakdown. The timing issue is self-explanatory but take caution if you were blindsided with divorce papers, because if you and your spouse were in wedded bliss when the misconduct occurred, you may be out of luck.