You Asked: “A wife and husband sell property and the funds are wired into their joint account. Two days after the wire wife transfers the entire amount into her own personal account, to which husband does not have access. Wife spends all of the money and now, she and husband are getting divorced and wife wants the house and alimony! Will the judge take into consideration, wife’s misappropriation of $300,000 and offset or deny her request for alimony? Husband and wife have only been married 8 years and she has never worked.”
In order to answer this question it would first be necessary to determine whether or not wife’s actions are considered “misappropriation” under applicable state laws. In terms of a domestic action, misappropriation means taking for ones own use without the knowledge of your spouse. Most states have strict laws with regard to handling assets once a divorce action has been filed; In fact, standard restraining orders are automatically in place in many jurisdictions to prevent either spouse from spending both community and separate property funds, transferring assets, changing title, etc. If, however, a divorce or legal separation action has not been filed, the question of misappropriation becomes less clear. For example, there are no laws, of which we are aware, that say a happily married wife who spends $25,000, $10,000, or $2,000 to buy a new car, luxury vacation, or plasma television during marriage with joint funds and without husband’s knowledge, has misappropriated money. That said, if for purposes of this question we assume a legal action has been filed and wife’s use of joint funds was misappropriation, a court may offset any property and/or alimony awards payable to wife, by the sum of money misappropriated or perhaps, more. In an equal distribution state or one that requires a showing of fault, the misappropriation could be viewed as such an egregious act to yield a result that would be considered by some, to be wildly in favor of husband, i.e. a credit to husband for the entire $300,000.00 wife misappropriated.
In terms of alimony, the state of residency is really integral to the answer to your question. In some states, alimony could be awarded for ½ the duration of the marriage. But no matter what the state, any alimony might be offset by the misappropriated funds. Since the sum is rather large, it would seem unlikely that wife would receive any alimony when looked at as a whole – but, if husband earned $300,000 monthly and it was common for wife to spend large sums of money during marriage, alimony may still be awarded despite wife’s $300,000 misappropriation. So ultimately, the answer to your question is “it depends”.
This article is not legal or financial advice. You should contact a lawyer, accountant and/or financial professional in your state to discuss the specifics or your case and applicable laws.
