The Fleischmanns got married in the middle of the husband’s law school education, which he paid for with scholarships, family gifts, savings, and summer earnings. After graduation, he embarked on a “steady rise to partner” at Shearman & Sterling (New York), billing upwards of 3,000 hours per year. His wife had a graduate degree in healthcare management, but left work to raise their three children. After 26 years, the couple filed for divorce in Fleischmann v. Fleischmann
, 1207-06 (S. Ct., Westchester Co.)(July 22, 2009). At stake: the value of the husband’s law license and his 0.5% partnership interest in the firm.
A court-appointed financial expert valued the marital component of the license at $1.4 million, based on the present value of the husband’s annual enhanced earnings for 17 years (2009 through 2025). The same expert valued the 0.5% partnership interest at $709,000 (based on the partnership agreement). The court accepted both values—but in light of the “quantity, quality, and directness” of each party’s contribution to the husband’s degree, and his “proven aptitude, ability, tenacity, hard work, and perseverance,” it awarded the wife only 10% of the law license’s value. Her homemaking efforts, though considerable, were directed more toward the “overall” marriage than the husband’s attainment of his license. The wife contributed “somewhat more” towards his partnership career, the court observed (including entertaining clients and attending firm functions), justifying a 25% award of the law firm partnership interest.
“This decision for the trial judge represents a continuation of the recent trend [of New York courts], which is to limit the equitable share for licenses and practices” of law partners and other professionals, according to the husband’s lawyer (as reported in the New York Law Journa
l). The trial court’s decision is not binding, of course, unless reviewed (and ratified) on appeal. Where you can find a summary of authority
: An advanced search of BVLaw™
turned up 16 of the leading New York opinions on the value and disposition of a professional degree in divorce. Got a research question, legal or valuation-specific? Try the search engine at BVResources
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