How Wasteful Dissipation Can Impact a Divorce

Unfortunately, divorce is rarely simple to resolve. Among many factors that can complicate a divorce is wasteful dissipation, which impacts the marital property subject to equitable distribution and how the court ultimately divides that property.

In this blog, we’ll explain what wasteful dissipation is in greater detail. We’ll also get into why this is such an important issue to address during divorce and what you can do if you suspect your spouse is engaging in wasteful dissipation.

What Is Wasteful Dissipation?

Wasteful dissipation refers to the squandering or reckless spending of assets during a divorce or legal separation process. It occurs when one spouse purposefully dissipates marital assets to prevent the other spouse from receiving a fair share during the division of property.

Examples of wasteful dissipation can take various forms, including:

• Excessive spending on non-essential items such as luxury goods, vacations, or extravagant gifts.
• Intentional destruction or damage to marital property out of spite or retaliation.
• Concealment of assets or fraudulent transfers to third parties to avoid division.
• Engaging in risky financial behavior, such as gambling or speculative investments, that results in significant losses.

This behavior can significantly impact the outcome of property division proceedings and may lead to legal consequences for the dissipating spouse.

Legal Implications of Wasteful Dissipation

Wasteful dissipation is considered a form of financial misconduct and can have significant legal implications during divorce proceedings. Courts typically view marital assets as belonging to both spouses and expect them to be managed responsibly for the benefit of the family unit. When one spouse engages in wasteful dissipation, it can be perceived as a breach of fiduciary duty and may result in adverse consequences for the dissipating party.

Impact on Property Division

One of the most immediate impacts of wasteful dissipation is its effect on property division. During divorce proceedings, marital assets are typically divided equitably between the spouses. However, if one spouse has dissipated assets recklessly, the court may adjust the distribution to compensate the other spouse for their losses.

For example, if a spouse spent a significant portion of marital savings on gambling, the court may award a larger share of remaining assets to the non-dissipating spouse to offset the losses.

Alimony and Support Obligations

Wasteful dissipation can also influence decisions regarding alimony or spousal support. If a spouse's reckless spending significantly diminishes their ability to contribute to their own support or that of their children, the court may adjust alimony or support obligations accordingly.

Conversely, if the dissipating spouse squanders assets in an attempt to reduce their financial obligations post-divorce, courts may impute income or refuse to grant a reduction in support payments.

How to Prove Wasteful Dissipation

Proving wasteful dissipation can be challenging because it requires demonstrating not only that the spending occurred, but also that it was done intentionally and without the other spouse's consent.

Documentation such as bank statements, credit card records, and receipts can be crucial in establishing a pattern of wasteful spending. Additionally, testimony from financial experts or witnesses may be required to substantiate the claim of dissipation.

Contact a Lawyer for Personalized Guidance

Wasteful dissipation can have far-reaching consequences on divorce proceedings, affecting property division, support obligations, and overall financial stability post-divorce. It underscores the importance of responsible financial management and mutual respect in marital relationships.

Whether you believe your spouse has engaged in wasteful dissipation or you are unfairly accused of this conduct, it's essential that you seek professional and personalized legal guidance. Dale L. Bernstein, Chartered Law Office can provide the legal support you need, which includes understanding your options and how you can move forward.

For more information, contact us online.