In Kentucky, the valuation date for a marital dissolution case is generally the date of divorce. In a new case, a court did not use the date of divorce but had good reasons. On appeal, the valuation date was affirmed.

Time is money: The couple divorced on June 30, 2020, which was the date the husband argued on appeal should be the valuation date. That way, the effects of COVID-19 could be factored into the valuation. Also, the company got hit with a large financial penalty from the FDA, which would also have impacted the valuation. But the family court chose Dec. 31, 2019, as the valuation date, at which time neither of those events were known or knowable.

The court chose the year-end 2019 date because the financials were set and agreed upon by both parties. If the divorce date of June 30, 2020, were used, there would be disagreement about any adjustments needed to round out the year, and this couple “could not agree on anything.” Also, the husband did not provide any evidence of actual business damages related to COVID-19. Plus, the husband never specifically asked the trial court to use the date of divorce. The appellate court affirmed the valuation date, noting the trial court gave a “well-reasoned explanation” as to why that date was chosen.

The case is Delk v. Delk, 2024 Ky. App. Unpub. LEXIS 407, and a case analysis and full court opinion are on the BVLaw platform.