No DLOC on a 50% interest, says appellate court
In a divorce matter in Indiana, the husband and wife each owned a 50% interest in a crop-dusting business.
Hyde Park Venture Partners Fund III L.P. v. FairXchange, LLC
This was a case that, once again, adopted the deal price in a shareholders’ dissent appraisal proceeding. The judge was not satisfied with the experts’ methodologies. He noted the difficulty in valuing a startup in a business model that had not been tried before. Absent compelling evidence of value from either side, the court fell back on the deal price.
Chancery Court (Delaware) Adopts Deal Price—Deplores Valuation Methodologies
This was a case that, once again, adopted the deal price in a shareholders’ dissent appraisal proceeding. The judge was not satisfied with the experts’ methodologies. He noted the difficulty in valuing a startup in a business model that had not been tried before. Absent compelling evidence of value from either side, the court fell back on the deal price.
Townsend v. Townsend
This was yet another case that emphasized the importance of the valuation expert’s responsibility to identify the amount of personal versus enterprise goodwill in a specific case.
Indiana Appellate Court Affirms the Value of Husband’s Business That Excludes Personal Goodwill but Adds Back DLOC as Parties’ Interests Must be Combined
This was yet another case that emphasized the importance of the valuation expert’s responsibility to identify the amount of personal versus enterprise goodwill in a specific case.
In re Maynard
In Texas, a community property state, there was no commercial goodwill transferred in an agreement between broker and a financial services company. Only personal goodwill was involved.
Texas Appellate Court Affirms That Higher Percentage of Commission on Legacy Clients Is Not Commercial Goodwill But Personal Goodwill
In Texas, a community property state, there was no commercial goodwill transferred in an agreement between broker and a financial services company. Only personal goodwill was involved.
Conde-Berrocal v. Conde
This was a companion case to the Rosenberg v. Rosenberg case, which was decided at the appellate court at the same time as this case by the same panel. Both cases dealt with personal goodwill in Florida in a multimember practice. The physician party in each case was part of the same practice and participated in the same sale of the company to a healthcare company. Personal goodwill was handled differently in each case in large part because the evidence submitted to the trial court was different.
Florida Appellate Court Affirms Trial Court’s Acceptance of Physician Spouse’s Expert in Calculating the Amount of Personal Goodwill
This was a companion case to the Rosenberg v. Rosenberg case, which was decided at the appellate court at the same time as this case by the same panel. Both cases dealt with personal goodwill in Florida in a multimember practice. The physician party in each case was part of the same practice and participated in the same sale of the company to a healthcare company. Personal goodwill was handled differently in each case in large part because the evidence submitted to the trial court was different.
Rosenberg v. Rosenberg
This case allowed the exclusion of the party’s personal goodwill as well as the personal goodwill of all of the other shareholders’ (practitioners’) personal goodwill in determining the marital asset value to be included in the marital estate. The importance was so great statewide that the appellate court certified this question for the Florida Supreme Court to consider.
Florida Appellate Court Excludes Personal Goodwill of All Physicians in a Group in Determining the Marital Asset
This case allowed the exclusion of the party’s personal goodwill as well as the personal goodwill of all of the other shareholders’ (practitioners’) personal goodwill in determining the marital asset value to be included in the marital estate. The importance was so great statewide that the appellate court certified this question for the Florida Supreme Court to consider.
In re Gerber
The court-appointed valuation expert in this divorce case determined a control value by deducting a discounted minority interest value from the 100% fair market value. Both the trial court and appellate court accepted this methodology.
Illinois Court Adopts Valuation of Its Own Expert—Determines Control Value by Deducting Discounted Minority Value
The court-appointed valuation expert in this divorce case determined a control value by deducting a discounted minority interest value from the 100% fair market value. Both the trial court and appellate court accepted this methodology.
Stay-at-home spouse gets 20% of value increase in husband’s separate business
In New York, the appreciation in value of a business started before marriage may be treated as marital property, but not all the appreciation is included. The courts use an active/passive test that carves out the passive appreciation (e.g., from market forces), so only the active appreciation of the business owner spouse would be subject to distribution to the nonowner spouse. But, in a recent divorce case, it appears that this analysis was not done, and the nonowner spouse got a share of the total appreciation of the business.
Athea v. Athea
In this divorce case, the Florida appellate court upheld the trial court’s acceptance of the husband’s valuation expert including the exclusion of personal goodwill. The court found the valuation and exclusion well supported by evidence and thereby will not be reversed. The court remanded the determination of monthly income of the wife.
Appellate Court Upholds Exclusion of Personal Goodwill—Well Supported
In this divorce case, the Florida appellate court upheld the trial court’s acceptance of the husband’s valuation expert including the exclusion of personal goodwill. The court found the valuation and exclusion well supported by evidence and thereby will not be reversed. The court remanded the determination of monthly income of the wife.
Rigas v. Rigas
In this appeal of a New York divorce case, the appellate court affirmed the award of 20% of the during-marriage appreciation of the husband’s business to the wife. The court accepted the valuation of the court-appointed appraiser and rejected the valuation by the defendant’s appraiser.
New York Appellate Court Affirms Award of 20% of Appreciation of Business During Marriage to Wife and Awards Maintenance to Wife
In this appeal of a New York divorce case, the appellate court affirmed the award of 20% of the during-marriage appreciation of the husband’s business to the wife. The court accepted the valuation of the court-appointed appraiser and rejected the valuation by the defendant’s appraiser.
Court opts not to split the difference in disparate valuations
Often, courts take the middle ground when faced with two disparate valuations, but, in an Ohio divorce case, the court did not do that.
Sneed v. Sneed
In this North Carolina appellate divorce case, the court affirmed the trial court decisions, including the determination of value of the husband’s law firm interest. The witness for the wife, who was originally a court-appointed expert, testified as to the value of the law practice and included his analysis of personal-versus-entity goodwill. Both courts included all goodwill in the marital estate as per North Carolina case law. The expert witness apparently submitted a calculation of value for his testimony.
North Carolina Court of Appeals Affirms Trial Court as to Inclusion of Personal Goodwill
In this North Carolina appellate divorce case, the court affirmed the trial court decisions, including the determination of value of the husband’s law firm interest. The witness for the wife, who was originally a court-appointed expert, testified as to the value of the law practice and included his analysis of personal-versus-entity goodwill. Both courts included all goodwill in the marital estate as per North Carolina case law. The expert witness apparently submitted a calculation of value for his testimony.
Court’s valuation is out of bounds
In an Indiana divorce case, the subject company was a gift shop and boutique the wife owned.
Cammenga v. Cammenga
In this Michigan divorce action, the court of appeals remanded for a second time for the trial court to measure the husband’s tax loss carryforward in an appropriate manner, including an option to value the loss carryforward annually.
Appellate Court (Michigan) Orders a Second Remand to Value a Tax Loss Carryforward Correctly
In this Michigan divorce action, the court of appeals remanded for a second time for the trial court to measure the husband’s tax loss carryforward in an appropriate manner, including an option to value the loss carryforward annually.
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.
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