Absent any valuation, court uses book value
In an Ohio divorce case, neither the husband nor the wife engaged a valuation expert to appraise the family business, a small company that manufactures parts for racing cars, firearms, and paintball guns.
West v. West
The wife appealed the valuation of the husband’s business, asserting that the trial court should have instructed the parties to submit evidence supporting the value instead of determining the value itself based on the evidence actually before the court. The trial court was affirmed.
Ohio Court of Appeals Affirms the Value of Husband’s Business Based on ‘the Evidence That Was Actually Before the Trial Court’
The wife appealed the valuation of the husband’s business, asserting that the trial court should have instructed the parties to submit evidence supporting the value instead of determining the value itself based on the evidence actually before the court. The trial court was affirmed.
BVLaw Review: The Top Valuation Cases of 2023
The BVLaw platform added approximately 70 cases during 2023, bringing the total to about 4,300 cases in the database. The cases are all related in some way to valuation, economic damages and lost profits, and other litigation. This article is a rundown of some of the more important cases for 2023.
Valuation of business hit by COVID-19 in recent divorce case
If you haven’t done so already, sooner or later you will value a business affected by COVID-19.
Dawson v. Dawson
The court of appeals, in an Arizona divorce case, affirmed the decision of the Superior Court to accept the wife’s expert’s value of the husband’s business. The wife’s expert used a three-year look back average of cash flows, while the husband’s expert utilized the most current year’s cash flow.
Court Chooses Three-Year Average Cash Flow Over Single to Determine Value of Husband’s Business—Appellate Court Affirms
The court of appeals, in an Arizona divorce case, affirmed the decision of the Superior Court to accept the wife’s expert’s value of the husband’s business. The wife’s expert used a three-year look back average of cash flows, while the husband’s expert utilized the most current year’s cash flow.
Fowler v. Fowler
In this divorce appeal, the court affirmed the value of the parties’ pharmacy corporation. The husband, appellant, parsed out components of a CVA’s valuation and did not offer an expert or his own opinion as to the value.
Arkansas Appellate Court Affirms Value of Pharmacy—Only One Valuation Opinion Offered
In this divorce appeal, the court affirmed the value of the parties’ pharmacy corporation. The husband, appellant, parsed out components of a CVA’s valuation and did not offer an expert or his own opinion as to the value.
Calculation report used in court but had no rival
Most valuation analysts will not use a calculation report in court. But what if the other side has nothing?
In re Marriage of Remitz
In this divorce case, the Montana Supreme Court reversed the trial court’s use of the date of dissolution, May 2017, as the valuation date, reversed the trial court’s revaluation of the husband’s business, and reverted to the value determined to the trial date in 2014. The wife had no involvement in the business subsequent to the 2014 trial date.
In re Hussain
Both parties appealed this Illinois divorce case. While several issues were appealed, we focus on the value of the business and the determination of debts against the business. Since the trial court was not given any substantial evidence as to the value of the business, it determined the value on its own with limited information. The appellate court affirmed that value. Additionally, the appellate court affirmed the trial court’s disallowance of debts against the business.
Montana Supreme Court Holds Proper Date of Business Value Is the Date of Trial (2014), Not the Date of Dissolution (2017)
In this divorce case, the Montana Supreme Court reversed the trial court’s use of the date of dissolution, May 2017, as the valuation date, reversed the trial court’s revaluation of the husband’s business, and reverted to the value determined to the trial date in 2014. The wife had no involvement in the business subsequent to the 2014 trial date.
Illinois Appellate Court Affirms Value of Business Where the Parties Provided No Evidence
Both parties appealed this Illinois divorce case. While several issues were appealed, we focus on the value of the business and the determination of debts against the business. Since the trial court was not given any substantial evidence as to the value of the value of the business, it determined the value on its own with limited information. The appellate court affirmed that value. Additionally, the appellate court affirmed the trial court’s disallowance of debts against the business.
Active depreciation charged to business owner in divorce
In a South Carolina divorce case, the business owner (husband) appealed the family court’s decision on the valuation of the family business.
Untangling Assets and Uncovering the Truth: A Deep Dive into Divorce Financial Forensics
This webinar transcript provides a discussion of methodologies, tools, and techniques needed to untangle complex financials in the context of divorce proceedings ...
No do-over for valuation of business hit by COVID-19
In a Wisconsin marital dissolution case, COVID-19 negatively impacted the husband’s hair salon business, which had to shut down for a while.
Barnes v. Barnes
The trial for this divorce case was extended almost eight months because the parties had assured the court it would be a three-day trial and it took four days. The fourth day was almost eight months after the end of the third day of trial. As a result, the husband argued that the value of his business should have been updated and consideration given to the effect of splitting the business’s real estate from the operations of the business. The appellate court noted that this issue had not been raised at trial and was, therefore, not appealable. Other issues not related to the business were issues for the appellate court.
Tennessee Appeals Court Affirms Trial Court Valuation and Trial Court’s Skepticism of Husband’s ‘Projections’
The trial for this divorce case was extended almost eight months because the parties had assured the court it would be a three-day trial and it took four days. The fourth day was almost eight months after the end of the third day of trial. As a result, the husband argued that the value of his business should have been updated and consideration given to the effect of splitting the business’s real estate from the operations of the business. The appellate court noted that this issue had not been raised at trial and was, therefore, not appealable. Other issues not related to the business were issues for the appellate court.
In re Marriage of Gill
The husband appealed the circuit court’s decision regarding his divorce decree and an order denying his motion to reconsider issues regarding the parties’ property division. He argued the circuit court erred in allocating less than half of the parties’ tax liability to the wife. He also argued the circuit court erred in denying his motion to reopen evidence regarding the impact of COVID-19 on his salon business. The appellate court rejected his arguments and affirmed the circuit court.
Appellate Court (Wisconsin) Affirms Trial Court Allocation of Tax Liability and Business Value in Divorce
The husband appealed the circuit court’s decision regarding his divorce decree and an order denying his motion to reconsider issues regarding the parties’ property division. He argued the circuit court erred in allocating less than half of the parties’ tax liability to the wife. He also argued the circuit court erred in denying his motion to reopen evidence regarding the impact of COVID-19 on his salon business. The appellate court rejected his arguments and affirmed the circuit court.
Divorce valuation is too little, too late
This is another in a rash of cases where one side either did not engage a valuation expert or did not use the expert to the best advantage.
Fair Value, Statutory Appraisals, Crypto, ESG, PE Deals, and More at the NYSSCPA BV Conference
As usual, the annual New York State Society of CPAs’ Business Valuation and Litigation Services Conference presented some very interesting and useful information. This article provides a recap of what was discussed.
BV News and Trends July 2023
A monthly roundup of key developments of interest to business valuation experts.
Pereira method used for marital interest in construction firm
In a Nevada divorce case, the court considered whether the valuation of the marital portion of a separate property business should be calculated under the Pereira or Van Camp approach.