Choosing a Valuation Date in Florida Divorce & Property Distribution
Valuation is key aspect of the distribution of marital assets when a marriage is dissolved. Obviously, the court must identify and place a value on those assets before they are distributed (equitably, in Florida). While this basic concept makes sense to most people, there are first some key decisions that need to be made when it comes to the valuation of marital assets; choices which may appear simple but are actually quite perplexing (so much so that there are entire law review articles written on the subject).
Specifically, choosing a valuation date within the equitable distribution legal system (i.e. Florida’s) can be so complex that it often ends up introducing serious delays in important divorce and asset distribution proceedings; even interfering with property values changing. Thus, it’s worth discussing with your divorce attorney in order to ensure that you understand just what exactly it involves.
The Law in Florida
Originally, the valuation date was based on the earliest date of a valid separation agreement or date of the divorce petition, unless the judge thought otherwise. However, the current state statute is a little more complicated, and effectively removed the presumption of dates for valuation of marital assets, only establishing a cut-off date for determining whether assets and liabilities are going to be classified as marital. Without the statute providing guidance, the courts have essentially had to determine what is equitable, leaving it largely up to previous case law and the judge’s discretion.
In Florida, this effectively leaves one case in particular in control of this question concerning valuation dates and how the correct one is selected. A district court held that the date of the dissolution trial (versus the date of actually filing for divorce) was the appropriate date for the valuation of marital assets, and cited factors such as the long period between the separation and trial date, the increase in value in that time, and the lack of evidence that the increase in value was attributable to one part over the other.
In other words, by choosing a date that is as close to the trial date as possible, the award to each party is much more likely to be fair because years can pass between when a couple files for divorce and when their actual trial date is set. However, there is still a significant amount of discretion afforded to the judge in each case, particularly when it comes to assets that have increased in value in large part due to the efforts of one party and not the other.
Contact Us about Property Distribution during Divorce
If you are contemplating or in the process of obtaining a divorce, it is crucial that you speak with a knowledgeable attorney as soon as possible so as to ensure that your property is protected. The office of Sandra Bonfiglio, P.A., serves clients in southeast Florida and ensures that their rights are protected. Contact us today to set up a consultation.