Dissipation of marital assets or dissipation of the marital estate is more common than you may think. Perhaps you’re contemplating divorce or ending your marriage and find that your soon-to-be ex-spouse deliberately damaged marital assets or spent marital funds in ways that are clearly not for the benefit of your marriage. If that sounds familiar it could qualify as dissipation.
Dissipation is briefly explained in Section 750 ILCS 5/503 of the Illinois Marriage and Dissolution of Marriage Act (“IMDMA”). Generally, expenditures held to constitute dissipation are extraordinary expenses that clearly do not further common marital interests.
- Gambling Losses: In re Marriage of Morrical, 216 Ill. App. 3d 643, 576 N.E.2d 465 (3d Dist. 1991); In re Marriage of Sobo, 205 Ill. App. 3d 357, 562 N.E.2d 1083 (1st Dist. 1990).
- Paying legal fees with marital assets: Head v. Head, 158 Ill. App. 3d 597, 523 N.E.2d 17 (1st Dist. 1988); See 750 ILCS 5/508 Author’s Note 12.1). However, payments made by the parties to their respective attorneys are considered advances from the marital estate. In re Marriage of Manker, 375 Ill. App. 3d 465, 874 N.E. 2d 880, 891 (4th Dist. 2007).
- Investments: Bona fide investment of money, which proves to be a loss, is generally not classified as dissipation. (In re Marriage of Drummond, 156 Ill. App. 3d 572, 409 N.E. 2d 707 (4gh Dist. 1987)
- Rent and Home Maintenance: Living expenses of one party after the marriage’s irreconcilable breakdown were held in one case to constitute dissipation in the First District. In re Marriage of Partyka, 158 Ill. App. 3d 545, 511 N.E.2d 676 (1st Dist. 1987) (funds spent by husband, including those to rent and maintain the residence in which he lived after leaving the marital home, were not for marital purposes and therefore constituted dissipation).
- Continued: Legitimate living expenses do not constitute dissipation. In re Marriage of Harding, 189 Ill. App. 3d 663, 676, 545 N.E.2d 459, 467 (1st Dist. 1989) (while sanctioning funds spent on “legitimate family expenses, and necessary and appropriate purposes,” found that a bare assertion that funds withdrawn from living trust account were used to pay for necessary expenses was insufficient to avoid a finding of dissipation) In re Marriage of Manker, 375 Ill. App. 3d 465, 476, 874 N.E.2d 880, 889-90 (4gh Dist. 2007) (rent is a legitimate living expense). Living expense were held not to constitute dissipation in In re Marriage of Hagshenas, 234 Ill. App. 3d 178, 197, 600 N.E.2d 437, 451 (2d Dist. 1992).
- Destruction of Assets: Destruction of family photographs constituted dissipation; if the marital property could not be restored, the trial court should have determined damages and considered an issue in the distribution of marital property. (In re Marriage of Ferkel, 260 Ill. App. 3d 33, 632 N.E.2d 1133 (5th Dist. 1994)
- Failing to maintain property is dissipation: failing to pay mortgage payments and prevent foreclosure in a family home, which results in a loss of equity, can constitute dissipation. In re Marriage of Jones, 187 Ill. App. 3d 206, 233, 543 N.E.2d 119, 137 (1st Dist. 1989). Exceptions apply.
- Failing to pay income tax liability, resulting in interest and penalties, constitutes dissipation. In re Marriage of Charles, 284 Ill. App. 3d 339, 672 N.E.2d 57 (4th Dist. 1996).
If you suspect dissipation has happened or could happen, it is recommended that you speak with an experienced attorney as soon as possible. Our divorce attorneys can provide you with the guidance you need about all family law and divorce issues including dissipation of marital assets.