Dissipation of Marital Assets in D.C. and Maryland

Dissipation of Marital Assets occurs when, during divorce proceedings or separation, one spouse intentionally spends marital funds or assets for purposes unrelated to the marriage so that the other spouse receives less in the property award of the final divorce.

Dissipation of Marital Assets in D.C.

 The D.C. Court of Appeals defines dissipation of marital assets under D.C. Code § 16-910(b) as “the disposition of marital property by a spouse in a manner intended to ‘circumvent the equitable distribution of the marital estate.’” Herron v. Johnson, 714 A.2d 783, 785 (D.C. 1998). The Court sets forth a test wherein the accusing party can show dissipation through evidence “that the spouse used marital property for his or her own benefit and for a purpose unrelated to the marriage at a time when the marriage was undergoing an irreconcilable breakdown.” Once this test is satisfied, the court must distribute the property in question, regardless of whether it still even exists. The burden shifts to the accused party, who must then demonstrate why the evidence presented does not constitute dissipation. This test does not require the moving party to demonstrate their spouse dissipated marital assets on purpose. Lastly, expending marital funds on living expenses and attorney’s fees is not considered dissipation.

 Dissipation of Marital Assets in Maryland

             The Maryland Court of Appeals determined that dissipation occurs when one party “[spends] or otherwise deplete[s] marital funds or property with the principal purpose of reducing the amount of funds that would be available for equitable distribution at the time of the divorce.” Omayaka v. Omayaka, 417 Md. 643, 653 (2011). The Maryland test requires the showing of intent which D.C. does not require. But, just like in D.C., when property is found to be dissipated, the Court should value it “with the other existing marital property.” Sharp v. Sharp, 58 Md. App. 386, 399 (1984). And, just like in D.C., spending marital funds on living expenses or attorney’s fees does not constitute dissipation of marital assets. Allison v. Allison, 160 Md. App. 331, 339-40 (2004).

 If you believe your spouse is dissipating marital property, please click here to contact the Markham Law Firm team for help or call us at 240-396-4373.