Paying for Relatives’ Emergency Expenses and the Risk of a Dissipation-of-Assets Claim in Your Maryland Divorce Case

An old saying posits that “When it rains, it pours.” Sometimes in life, that can mean having to deal with multiple traumatic events — like your divorce and a relative’s grave illness — at the same time. Whatever the secondary emergency may be, you should take care when it comes to spending money during the pendency of your divorce case, even if it is for something as important as paying for care for a close loved one. What you can and cannot do will depend on multiple factors, like what court orders you’re under and whether the funds you seek to spend are marital or non-marital. One way to enhance your odds of avoiding troubles down the road regarding those expenses is to consult an experienced Maryland divorce lawyer before you act.

A recent divorce dispute from Anne Arundel County is a stark reminder of this notion. The husband filed for divorce in late 2019. In early January 2020, the trial judge issued an “Injunction to Prevent Dissipation of Assets.” That injunction barred the husband from “disposing of… any of the property alleged to be marital property or property acquired during the separation.”

In late 2021, the husband emptied the entire $72,800 balance of his Thrift Savings Plan and put the net proceeds (after penalties and taxes) of $56,800 into his credit union account. The husband eventually spent all of those proceeds to support his father in Nigeria, who had stage IV cancer. The couple also had a Lexus vehicle that the husband sold during the divorce for $18,600, of which the wife received $0.

The trial court concluded that these transactions constituted dissipation of assets and awarded the wife 60% of the $91,400 total, or a monetary award of roughly $55,000.

3 Key Things to Know About Dissipation Cases

There are a few crucial things you need to know about cases like this. One is the importance of being fully equipped when you appear before the trial court. The law says that an appeals court “will not set aside a trial court’s determination regarding dissipation of marital assets unless the determination made is clearly erroneous.” That phrase — clearly erroneous — means that there is no competent evidence in the case that could possibly support the outcome the trial court awarded.

That makes appeals in these cases particularly challenging to win, so giving the trial court everything possible to support your position at your hearing is critical.

Another is the way that the trial court will go about deciding an allegation of dissipation. The law places the initial burden of proof on the spouse who alleges dissipation. If that spouse meets his/her initial burden of making out a “prima facie” case of dissipation, then the burden shifts to the other spouse, who must prove that he/she spent the funds on “marital or family purposes.”

Finally, understand what the law does and does not consider “family purposes.” This phrase limits your expenditures to things “for the benefit of the immediate family unit.” Even something as selfless as paying for a parent’s urgent medical care needed as a result of catastrophic illness is still an expenditure that is not related to the marriage or the family unit (spouse and minor children,) and is therefore vulnerable to a dissipation claim.

Divorce is often a very painful process. It can also be a very costly event if you are not properly prepared. To avoid making your divorce more costly than it needs to be, you need the right legal advice and advocacy. Rely on the knowledgeable Maryland family law attorneys at Anthony A. Fatemi, LLC to be that effective voice and trusted advisor for you. Contact us today at 301-519-2801 or via our online form to set up your consultation.

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