What is Dissipation and How Does it Work?

Dissipation is the use of marital monies for a non-marital purpose.  If spending by one spouse is found to constitute dissipation, that spouse will have to pay the dissipated funds back into the marital estate for re-distribution.  For example, if Spouse A is found to have dissipated $10,000, Spouse A won’t necessarily have to pay $10,000 to Spouse B.  This is because part of the $10,000 belongs to Spouse A as well.  So, Spouse A will re-pay the marital estate $10,000.  Once the Judge decides how much of the marital estate Spouse A will receive and how much Spouse B will receive, the $10,000 will be allocated accordingly.  For example, if the Judge finds that Spouse A should receive 60% of the marital estate, then Spouse A would retain $6,000 of the dissipated monies and pay to Spouse B the remaining $4,000 from the dissipated monies.  The funds simply must be re-distributed in accordance with out the marital estate is divided, and not necessary paid all as a lump sum directly to the non-dissipating spouse.

 

Many parties wonder what constitutes dissipation, and it is somewhat discretionary and up to the Judge.  Generally, things outside of the marital purpose are considered dissipation, particularly when they are of large value.  For example, if a spouse takes friends or a new significant other on a vacation and pays their expenses, that is dissipation.  If a spouse takes a friend or new significant other out for coffee at Starbucks, that is not likely to be considered dissipation.  Additionally, monies a party spends on themselves could be considered dissipation.  For example, if during the marriage the parties drove 15 year old Toyotas and a spouse decides to purchase a $100,000 Mercedes Benz, that might be considered dissipation.  Additionally, if the parties traveled during the marriage but always stayed at a Marriott and drove or flew coach, and one party now decides to fly first class and stay at the Ritz-Carlton, that might be considered dissipation.  It is up to the non-dissipating spouse to allege the dissipation occurred, with specificity, and then up to the alleged dissipating spouse to prove that the expenses were not dissipation.

 

Leave a Reply