Husband vs. valuation expert, court splits the difference
In an Iowa divorce case, the wife engaged a CPA and valuation analyst to value the husband’s construction company, and he concluded a value of $1,020,597.
In re Marriage of Marasco
This case was an appeal of an Iowa marital dissolution decree. The husband on appeal argued the value the wife’s expert determined was too high and should not have been relied on. The appellate court noted that part of the reason the trial court used the wife’s expert’s appraisal was that the business was able to obtain a $10 million loan during the time of the valuation. Additionally, the appellate court affirmed that the entire value of the business was community property.
Iowa Court of Appeals Affirms Value of Husband’s Business Determined by Wife’s Expert and Includes Total Value as Marital Property
This case was an appeal of an Iowa marital dissolution decree. The husband on appeal argued the value the wife’s expert determined was too high and should not have been relied on. The appellate court noted that part of the reason the trial court used the wife’s expert’s appraisal was that the business was able to obtain a $10 million loan during the time of the valuation. Additionally, the appellate court affirmed that the entire value of the business was community property.
BV News and Trends May 2023
A monthly roundup of key developments of interest to business valuation experts.
Notable takeaways from the NYSSCPA BV conference
BVWire attended last week’s annual New York State Society of CPAs’ Business Valuation and Litigation Services Conference, and—as usual—some very interesting and useful information was presented.
Mamone v. Mamone
The Nevada appellate court affirmed the trial court’s use of the Pereira method of determining the value of separate property included in the total value of the husband’s business. It was clear that the value increase in the business during the marriage was due in large part to the efforts of the husband. The “excess value” of the business over the separate property value was included in the community property. The appellate court also affirmed the ruling of the trial court that no community expenses incurred during the marriage were paid from the separate property of the husband and the husband was, therefore, not entitled to any reimbursement of those community expenses.
Nevada Appellate Court Affirms Value of Husband’s Business and His Separate Property Value in the Business
The Nevada appellate court affirmed the trial court’s use of the Pereira method of determining the value of separate property included in the total value of the husband’s business. It was clear that the value increase in the business during the marriage was due in large part to the efforts of the husband. The “excess value” of the business over the separate property value was included in the community property. The appellate court also affirmed the ruling of the trial court that no community expenses incurred during the marriage were paid from the separate property of the husband and the husband was, therefore, not entitled to any reimbursement of those community expenses.
Financial expert guide added to BVResearch Pro
The Financial Expert Guide for Family Law Judges and Attorneys, National Edition, is now on your digital bookshelf if you are a subscriber to the BVResearch Pro platform.
Financial Expert Guide for Family Law Judges and Attorneys, National Edition
April 2023 PDF, Softcover (413 pages)
John Tatlock, Kevin Yeanoplos, Ron Seigneur
Business Valuation Resources, LLC
Appellate court KOs ‘laughable’ purchase offer
An offer to purchase a business can sometimes be evidence of value, but a recent divorce case in Indiana illustrates when it is not.
In re Marriage of Bainbridge
In this Iowa appellate case regarding a marital dissolution, the appellate court affirmed the decision of the trial court judge as to the value of the husband’s construction company. The wife’s expert used a valuation date of Dec. 31, 2020, versus trial date of December 2021 because of availability of information on the business.
Value of Husband’s Business Affirmed Based on Trial Judge’s Reasonable Discretion
In this Iowa appellate case regarding a marital dissolution, the appellate court affirmed the decision of the trial court judge as to the value of the husband’s construction company. The wife’s expert used a valuation date of Dec. 31, 2020, versus trial date of December 2021 because of availability of information on the business.
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.
Nix v. Nix
This case concerned an appeal of a trial court opinion in a divorce case in Indiana. The trial court based the value of a warehousing and logistics business on an offer to purchase the business the daughter of the divorcing parties presented at trial. The mother, the owner operator of the business, rejected the offer, made prior to the filing for dissolution of marriage. The appellate court remanded the decision of the trial court for revaluation of the business with instructions to determine a value within the valuation conclusions experts submitted for each party at trial.
Indiana Appellate Court Remands Value of Business—Trial Court Value Based on a Defective Offer to Purchase
This case concerned an appeal of a trial court opinion in a divorce case in Indiana. The trial court based the value of a warehousing and logistics business on an offer to purchase the business the daughter of the divorcing parties presented at trial. The mother, the owner operator of the business, rejected the offer, made prior to the filing for dissolution of marriage. The appellate court remanded the decision of the trial court for revaluation of the business with instructions to determine a value within the valuation conclusions experts submitted for each party at trial.
California Appellate Court Affirms That the Marital Settlement Agreement Should Not Be Set Aside for Alleged Inadequate Disclosures
The husband and wife entered into a settlement agreement as to their divorce that was included in the trial court’s judgment of dissolution. The wife thereafter asked the trial court to set the agreement aside due to, among other things, the husband’s failure to disclose his ownership interests in various businesses. The appellate court found the evidence for her motion(s) to be lacking and affirmed the trial court.
In re Hettinga
The husband and wife entered into a settlement agreement as to their divorce that was included in the trial court’s judgment of dissolution. The wife thereafter asked the trial court to set the agreement aside due to, among other things, the husband’s failure to disclose his ownership interests in various businesses. The appellate court found the evidence for her motion(s) to be lacking and affirmed the trial court.
BVLaw Review: The Top Valuation Cases of 2022
Here is our pick for the most noteworthy valuation cases that emerged over the past year. They include state and federal court decisions covering many areas of law that enhanced our understanding of valuation issues as they arose in a litigation setting.
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.
Recap of the AAML/BVR National Divorce Conference
It was a happy marriage of divorce attorneys and financial experts who gathered together for the AAML/BVR National Divorce Conference in Las Vegas. The AAML is the American Academy of Matrimonial Lawyers.
The Two Most Prevalent Methods for Solving the Goodwill Conundrum
Remarks from a session at the AAML/BVR National Divorce Conference conducted by veteran valuers Jay Fishman (Financial Research Associates) and Ken Pia (Marcum) who were joined by attorney Thomas J. Sasser (Sasser, Cestero & Roy).