Smith v. Smith
In this divorce case appeal, the appeals court remanded to the Chancery Court the issue of separate versus marital property. The appellate court determined that one of the husband’s businesses was marital property and not separate property as the Chancery Court decided. It remanded that portion of the Chancery decision with instructions to change the ruling and determine a value for the now marital property business—but without any goodwill.
Appellate Court (Mississippi) Affirms That Goodwill Is Not a Marital Asset
In this divorce case appeal, the appeals court remanded to the Chancery Court the issue of separate versus marital property. The appellate court determined that one of the husband’s businesses was marital property and not separate property as the Chancery Court decided. It remanded that portion of the Chancery decision with instructions to change the ruling and determine a value for the now marital property business—but without any goodwill.
BV News and Trends May 2023
A monthly roundup of key developments of interest to business valuation experts.
Lieberman-Massoni v. Massoni
The trial court in this New York divorce awarded the value of the husband’s class B units in lieu of awarding a portion of the actual units to the wife and also barred the wife from any distributions on those units occurring after the valuation date.
New York Appellate Court Affirms Award of Value of Husband’s Class B Units in Lieu of Actual Distribution of Share of Units
The trial court in this New York divorce awarded the value of the husband’s class B units in lieu of awarding a portion of the actual units to the wife and also barred the wife from any distributions on those units occurring after the valuation date.
Have you tried Abbott’s passive appreciation calculator?
In last week’s BVWire, we mentioned that Dr. Ashok Abbott (West Virginia University) has developed an online application that produces a passive appreciation factor on a national level for businesses in the retail sector.
Court do-over to figure passive appreciation for divorce
In an Ohio divorce case, the trial court made an award to the wife based on the full fair market value of the husband’s business.
Wife who foregoes expert can’t complain about the outcome
A marital dissolution case in Illinois is another instance of a party not offering a competing valuation and then appealing the outcome—to no avail.
Ohio Appellate Court Remands Value of Businesses for Determination of Active Appreciation
This matter involved cross-appeals from a divorce decree in Trumbull County, Ohio. The focus of this digest relates to cross-appeals relating to the values of the husband’s businesses and the matter of active appreciation on those businesses.
Fordeley v. Fordeley
This matter involved cross-appeals from a divorce decree in Trumbull County, Ohio. The focus of this digest relates to cross-appeals relating to the values of the husband’s businesses and the matter of active appreciation on those businesses.
Chase v. Chase
On appeal, the husband asked the court to review whether the wife needed alimony given the assets she otherwise received in the equitable distribution and her earning capacity as a pharmacist, whether an award of rehabilitative alimony and alimony in futuro by the trial court was appropriate, and whether the trial court’s valuation of the husband’s medical practice was in error. The appellate court affirmed the trial court in all aspects reviewed and did not award legal fees to either party.
Tennessee Appeals Court Affirms Trial Court Decision on Spousal Support and on the Value of Husband’s Medical Practice
On appeal, the husband asked the court to review whether the wife needed alimony given the assets she otherwise received in the equitable distribution and her earning capacity as a pharmacist, whether an award of rehabilitative alimony and alimony in futuro by the trial court was appropriate, and whether the trial court’s valuation of the husband’s medical practice was in error. The appellate court affirmed the trial court in all aspects reviewed and did not award legal fees to either party.
In re Trapp
The primary issue in this Illinois appeal of a divorce decree dealt with the value of a company owning two buildings. The primary tenant in both buildings was the husband’s electrician business. The trial court accepted the value of the real estate company the husband’s business valuation expert, who was not a real estate appraiser, submitted. The business appraiser valued the two buildings using what the court determined to be “competent evidence.”
Illinois Appeals Court Affirms Trial Court’s Acceptance of Real Estate Value in Absence of Wife’s Submission of a Competing Value
The primary issue in this Illinois appeal of a divorce decree dealt with the value of a company owning two buildings. The primary tenant in both buildings was the husband’s electrician business. The trial court accepted the value of the real estate company the husband’s business valuation expert, who was not a real estate appraiser, submitted. The business appraiser valued the two buildings using what the court determined to be “competent evidence.”
Brown v. Brown
In this Mississippi divorce case, the appellate court en banc reversed in part and remanded in part, asking the trial court to determine whether certain items were marital property and determine the values for certain marital properties so a proper distribution of marital property can be made. Included was a used-car business that was remanded for a value to be determined. Several judges dissented primarily because the marital estate in total was not very material and they believed the appellate court could have made adjustments without remanding.
Mississippi Appeals Court En Banc Remands for Valuation of a Small Used-Car Business With Dissents From Several Judges
In this Mississippi divorce case, the appellate court en banc reversed in part and remanded in part, asking the trial court to determine whether certain items were marital property and determine the values for certain marital properties so a proper distribution of marital property can be made. Included was a used-car business that was remanded for a value to be determined. Several judges dissented primarily because the marital estate in total was not very material and they believed the appellate court could have made adjustments without remanding.
Court uses old transaction to value a dental practice
In a North Carolina divorce case, the wife’s stake in a dental practice was valued based on what she paid for it two years before she and her husband separated in 2015 (the valuation date).
Mikalacki v. Rubezic
In this Arizona marital dissolution case, the Court of Appeals affirmed the trial court’s acceptance of a calculation of value to determine the value of a couple’s law practice, awarded to the husband as part of the equitable distribution. Other matters not related to valuation issues were part of the appellate decision.
Arizona Appeals Court Affirms Trial Court’s Acceptance of a Calculation of Value
In this Arizona marital dissolution case, the Court of Appeals affirmed the trial court’s acceptance of a calculation of value to determine the value of a couple’s law practice, awarded to the husband as part of the equitable distribution. Other matters not related to valuation issues were part of the appellate decision.
Logue v. Logue
In this marital dissolution case in North Carolina, the appellate court affirmed the trial court’s determination of value of the wife’s dental practice. The trial court determined the value based on the value of the entire practice determined several years before the separation date. That value was determined by appraisals by professional appraisers to determine the buyout of the husband’s father’s 50% interest in the practice. No evidence of value as of the separation date was provided by the parties who decided not to hire appraisers to assess the value at the separation date.
North Carolina Appellate Court Values a Dental Practice Based on a Two-Year-Old Purchase of an Interest in the Practice
In this marital dissolution case in North Carolina, the appellate court affirmed the trial court’s determination of value of the wife’s dental practice. The trial court determined the value based on the value of the entire practice determined several years before the separation date. That value was determined by appraisals by professional appraisers to determine the buyout of the husband’s father’s 50% interest in the practice. No evidence of value as of the separation date was provided by the parties who decided not to hire appraisers to assess the value at the separation date.
Simons v. Simons
The Nebraska Supreme Court allowed a fair value determination by the wife’s expert as the appropriate value for a divorce case and did not include any discounts that might apply in a fair market value determination. Much of the opinion dealt with the issue of a constructive trust, which the trial court determined results in a 50% ownership by the wife in the family business.
Nebraska Supreme Court Allows Fair Value Determination for Family-Owned Business and Does Not Allow Discounts
The Nebraska Supreme Court allowed a fair value determination by the wife’s expert as the appropriate value for a divorce case and did not include any discounts that might apply in a fair market value determination. Much of the opinion dealt with the issue of a constructive trust, which the trial court determined results in a 50% ownership by the wife in the family business.
Nothing personal about goodwill in dental practice
In a South Carolina divorce case, the appellate court reversed the family court on the issue of personal versus enterprise goodwill.
Bostick v. Bostick
The South Carolina Court of Appeals, in this divorce case, reversed the family court and included all goodwill of a dentistry practice as enterprise goodwill includable in the marital estate. The family court had included all of the goodwill as personal goodwill not part of the marital estate. The Court of Appeals also reduced the temporary monthly alimony.