Divorce requires the resolution of many issues. One of the hotly contested issues is how marital property will be divided between spouses. New Jersey, like 40 other states, adheres to the principle of equitable distribution.
In equitable distribution, marital property is divided fairly but not necessarily equal. Circumstances can result in “fair” favoring one side. A spouse can ask for a greater share of the marital assets in a divorce judgment if they believe the other spouse intentionally squandered their money.
Dissipation of Assets in a Marriage
Dissipation of assets is another way of saying one spouse is attempting to cheat another spouse out of their fair share of the marital estate. They frivolously spend money or diminish the marital estate so there is less to divide in a divorce. The court frowns on such misconduct.
General examples of dissipation include the following:
- Making extravagant purchases
- Concealing assets
- Spending marital funds on an extramarital affair
- Giving marital property to friends or family
- Withdrawing large sums of cash
- Gambling excessively
A recent high-profile claim of dissipation is found in the petition for divorce filed by Jennifer Flavin in Florida on Aug. 19, 2022. She is seeking a divorce from her husband of 25 years, actor Sylvester Stallone. According to reports, the petition accuses Stallone of “intentional dissipation, depletion and/or waste of marital assets which has had an adverse economic impact on the marital estate.”
There are no specifics about how he allegedly dissipated funds.
Dissipation Depends on Timing & Characteristics
Spending too much money years before a divorce will not typically be considered dissipation. Allegations are only valid if the wasteful or deceitful conduct occurred after the marriage was beginning to crumble. The expenditure should also be unusual and benefit only one spouse.
Consequences of Dissipation of Assets in New Jersey
In her Florida divorce petition, Ms. Flavin asks to be “compensated and made whole by receiving an unequal distribution of the marital assets in her favor."
A similar uneven division of property is possible in New Jersey divorces.
New Jersey law outlines what judges must consider when determining how to distribute the assets between divorcing spouses.
There are 16 criteria identified in the law. Dissipation is specifically mentioned:
“The contribution of each party to the acquisition, dissipation, preservation, depreciation or appreciation in the amount or value of the marital property, or the property acquired during the civil union as well as the contribution of a party as a homemaker”
While the legislation does not define dissipation, the Superior Court of New Jersey Appellate Division describes dissipation as when “a spouse uses marital property for his or her own benefit and for a purpose unrelated to the marriage at a time when the marriage relationship was in serious jeopardy.”
Giving a bigger share of the marital estate to the wronged spouse is not the only possible penalty:
- The court can order the offending spouse to pay higher spousal support payments.
- The guilty spouse can be ordered to be responsible for a greater share of the marital debt.
Legal Counsel Fighting for Fair Property Division
Our attorneys at Lane & Lane, LLC know that life after divorce is best supported by a fair divorce judgment. We work tirelessly for our client’s best interests. With more than 60 years of collective experience, we apply our profound legal knowledge to help the families of New Jersey through challenging times in their lives.
If divorce is on the horizon, schedule a free case consultation with us. Contact us through our online form or call (908) 259-6673.
