In general terms, dissipation of marital assets is when one spouse uses marital assets for things that are not for the married couple or the family. This can be thought of as wasting marital assets. Some spouses waste marital assets as a method of “punishing” the other spouse and trying to ensure that the other spouse has fewer assets after the divorce. Indeed, that is the legal definition of dissipation of marital assets: expended marital money for the principal purpose of reducing the funds available for equitable distribution. Generally, if a Maryland divorce court finds that marital assets have been dissipated, the court will award the amount of dissipated assets to the non-dissipating spouse in addition to equitably dividing the remaining marital assets. Interestingly enough, BOTH spouses can be accused of dissipating marital assets, and the Maryland divorce courts will account for those assets in the final divorce decrees.

A good example of this can be seen in the recent case of Goicochea v. Goicochea (Court of Special Appeals of Maryland 2022). In that case, both spouses accused the other of dissipating marital assets.

The husband’s accusation against the wife was straightforward. Bank records showed that the wife withdrew $200,000 from a joint financial account shortly after the divorce was filed. That fact alone established what Maryland divorce courts call “prima facie” evidence of asset dissipation. When prima facie evidence is presented, it then becomes the obligation of the spouse in question to prove that the money was actually spent for proper purposes (like the needs of the family). In Goicochea, the wife was able to show — with receipts and her testimony — that $150,000 was, in fact, used for the needs of the family, like paying bills. The wife was ultimately unable to prove how she spent the remaining $50,000, and the Maryland divorce court held that she had dissipated those funds. The husband was “credited” with that $50,000. This was approved and affirmed by the Maryland appellate court.

The wife’s accusations against the husband were more complex. The wife accused the husband of cheating on her starting at least 10 years before the divorce. The wife provided evidence that, during those years, the husband spend more than $350,000 on his paramour and her family, including about $200,000 for a home for his paramour, about $79,000 in cash payments to the paramour and members of her family and almost $62,000 for gifts, expenses, travel, and dining. As required by Maryland’s divorce laws, the wife presented sufficient evidence to create prima facie evidence that the husband spent the sums listed above. At that point, the husband had the burden to show that those monies were spent on family and marital needs. The husband made various efforts — like arguing that some of the monies were used to pay taxes. However, the Maryland divorce court found the husband’s arguments and testimony not credible. The court held that the husband had dissipated marital assets and gave the wife “credit” for those amounts. This was approved and affirmed by the Maryland appellate court.

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This article has been provided by the Law Office of Robert Castro. For more information or questions, contact our office to speak to an experienced Maryland family law and divorce lawyer at (301) 870-1200. We are Waldorf, MD, Divorce lawyers. Our address is 2670 Crain Highway, Waldorf, MD, 20601.