Rohling v. Rohling, 2018 Ala. Civ. App. LEXIS 94 (June 1, 2018)
There is a split in the valuation community as to the merit of calculation engagements. As we recently reported, some valuators are adamantly opposed to doing calculation engagements, fearing, among other things, that nonvaluators, including judges, may not recognize the critical differences between a valuation engagement and a calculation of value. Other appraisers believe that calculation engagements have a rightful place in their tool kit.
A recent Alabama divorce case disproves the argument that a calculation of value has no place in litigation. The trial and appeals court opinions make clear that judges may well recognize the differences between the two types of value determinations but may still find a calculation report helpful to the court.
The parties in this divorce proceeding contested the valuation of the husband’s dental lab. The husband served as his own valuation expert. The wife retained a CPA and certified valuation and financial forensics analyst. The expert worked pursuant to a calculation engagement. Throughout trial, the husband and his attorney tried to discredit the opposing expert’s work product, but the court was not receptive to their objections.
The trial court noted that just because a “more arduous or accurate method (valuation engagement) exists does not preclude the Court’s consideration of [the expert’s] findings.” It adopted the expert’s calculated amount. The appeals court affirmed.
To find out more about the appeals court analysis, click here.