Litigation + Valuation Perspectives

Demystifying Valuation, Economic Damages + Forensic Accounting

A Contract to “86” wife isn’t part of the divorce settlement

divorceOver the years I have been asked to be an expert regarding many marital dissolution cases. Most of my cases deal with valuing business interests held by the divorcing parties and income determination in connection with spousal maintenance and child support issues. Many of my cases have gone amicably between the divorcing parties. Some were quite acrimonious.

I once valued a business owned by a divorcing couple where I had to determine the value of Wife’s 50% interest in the business – a heating, ventilation and air conditioning sales and repair operation. The divorce came about because Wife found out that Husband had a girlfriend. Wife was pretty ticked about it. Actually, she was more than pretty ticked.

I discovered that Husband had received substantial amounts of income that he was not reporting on a Schedule C of the couple’s 1040 tax return. Wife knew it when she signed the tax return. In my interview of Wife, I told her that if the couple’s tax returns had been fraudulently prepared, and the judge who would be presiding over their dissolution proceedings became aware of this fact, the judge could very well report the couple to the Internal Revenue Service. I added that both she and Husband could wind up in jail. Wife looked me square in the eye and said, “I don’t care if I go to jail. I just want to get the dirty rotten #!*!%#!!!.”

That was a pretty resentful comment from Wife. But, it doesn’t compare with how another divorcing husband wanted to make his soon to be ex-spouse suffer. He decided he would have her killed.

Arizona Attorney magazine publishes monthly abbreviated summaries of important trials that have settled around the state. In the February 2016 issue one of the case summaries under the caption, Conspiracy to Commit Murder,” had this to say in part: “Spouse allegedly hired contract killer during divorce; plaintiff awarded $22.8 million.” The case was tried in Maricopa County Superior Court.

To be more precise, that was a verdict of $22,807,000 in favor of Wife. I went online to the Maricopa County Arizona Superior Court website to find out more on the case. I did not find out much about the particulars of the conspiracy, but I did get some additional information of what made up the $22.8 million awarded to Wife. The jury verdicts were stated as follows:

We, the Jury, duly empaneled and sworn in the above-entitled action, upon our oaths, do find in favor of Plaintiff, ……… on her claim for compensatory damages, and award compensatory damages in the amount of $4,822,000.00.

The second verdict was stated: “We, the Jury, duly empaneled and sworn in the above-entitled action, upon our oaths, do find in favor of Plaintiff,…….. on her claim for punitive damages, and award punitive damages in the amount of $17,985,000.00.

I could find no information on what basis the damage amounts were made.

Hiring someone to erase one’s spouse? Now that’s what I call being really ticked off.

Don Bays CPA, ABV, CVA, CFF