A recent case here in California will have wide spread application and could create a nightmare for those who have less than perfect record keeping habits. In Re: Marriage of Margulis, stated a new rule in answering the following question in the affirmative. “In a marital dissolution proceeding to divide the community property, where the non-managing spouse has prima facie evidence that community assets of a certain value have disappeared while in the control of the managing spouse post-separation, should the managing spouse have the burden of proof to account for the missing assets?”
In the case wife produced a financial statement prepared by husband that listed a number of assets and investment accounts that were no longer in existence or disclosed by husband at the time of the trial. Husband indicated that in the many years post separation he spent the funds on community bills, to support wife and the rest was lost due to declines in the value of the investments.
Husband called an accounting expert who calculated sums spent on community bills and support of wife based on a review of some records and explanations of husband. The trial court agreed but the Court of Appeal reversed stating husband had the burden to prove what had happened to the accounts as he was the managing spouse. The court also rejected the accountant’s testimony in that it he was unable to determine the payments made by husband were paid from his separate funds.
The moral of this tale, keep records, share records and disclose everything in your divorce. If you want to know more about what happened to husband and what likely will happen feel free to give me a call.
For more information about annulments and other family law matters, contact the Reape-Rickett Law Firm at 661-288-1000. They are located at 23929 West Valencia Boulevard, Suite 404 in Valencia.