LEGAL GUIDE
Written by attorney Angela M Wilson-Goodman | Mar 11, 2011

Marital Waste: Tit for Tat? More Like Dollar for Dollar.

The Arizona statute for division of community property (ARS 25-318) requires that a determination be made "without regard to marital misconduct." But, part B to ARS 25-318 does allow the court to consider "excessive or abnormal expenditures, destruction, concealment or fraudulent disposition of community, joint tenancy and other property held in common," typically referred to as marital waste.

I have come across some conflicting interpretations of what it means to consider marital waste when dividing community property. While it may seem like an amorphous or discretionary test, the case law is surprisingly cogent. First, the "spouse alleging abnormal or excessive expenditures by the other spouse has the burden of making a prima facie showing of waste." Gutierrez v. Gutierrez, 193 Ariz. 343, 972 P.2d 676 (Ariz. Ct. App. 1998).

So then what happens when the alleging spouse succeeds and their claim of waste is not effectively rebutted by the other party? "When there is waste or dissipation of marital assets by one spouse, the [family] court may, when apportioning community property, award money or property sufficient to compensate the other spouse for that waste." Hrudka v. Hrudka, 186 Ariz. 84, 93, 919 P.2d 179, 188 (App.1995). In such a case, "[t]he value of the dissipated property should be added to the value of the other existing community ... property" and the "total value of existing and dissipated property should be equitably divided between the spouses." Martin v. Martin, 156 Ariz. 452, 458, 752 P.2d 1038, 1044 (1988).

This is a pretty simple quantification of marital waste that represents a dollar for dollar offset. Determine the exact amount of dissipated property, add that to the total value of property, and then divide the property. With this method, only half of the amount spent is actually given to the harmed party in compensation. This is because, as we should know, even half of what is wasted belongs to the wasting spouse. In other words, it is their share of the community property in the first place.

For example, say a divorcing couple owns $50,000.00 in community property and the Court makes a finding that Wife committed $10,000.00 in marital waste. The Court will then divide $60,000.00 worth of assets ($50,000 plus $10,000), awarding Husband and Wife $30,000.00 worth of property each. For Husband, this is his $25,000.00 of the parties' actual assets, plus property valued at the half of Wife's waste, for a grand total of $30,000.00. Wife, on the other hand, will receive her $25,000.00 in assets and will simply be considered to have already received her half of the waste because it has already been spent.

In conclusion, by using a dollar for dollar offset method, the Court is able to properly compensate the injured spouse while, at the same time, staying true to the reality that marital misconduct is not legally relevant in this no-fault state.

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