Marital Waste Audits

Marital waste is a complex claim in Nevada. The claim is based on the parties’ fiduciary duty to each other. Spouses are expected during marriage to look out for the assets of the community in the same way a trustee of a trust would look after the assets of the trust. 1

For investments, the standard is that of a “reasonably prudent investor.” Malicious or reckless expenditures of community property can addressed labeling them waste and then imputing the amount of money wasted entirely to the wasteful spouse.

The Nevada Supreme Court has upheld a family court unequally dividing assets because of the financial misconduct of one of the parties—such as waste or secretion of community assets in violation of court order. 2

The Nevada Supreme Court also determined that a party’s financial misconduct, which included lying to the Court about financial matters and not accounting for his money, provided the Court with a compelling reason to make an unequal division of the known community property.3 The Court noted in that case that other possible compelling reasons for an unequal division of community property could include negligent loss or destruction of community property, unauthorized gifts of community property, and possibly losses occasioned by marriage and its breakup.4

What most often comes in regarding marital waste is gambling. If one party gambles a significant portion of the community assets away, this could be a basis for the court to unequally divide the remaining community assets. This of course requires the party claiming marital waste to prove to the court when and how much money was gambled away.

Waste analysis – hourly

If you are concerned that the other party might be hiding money, spending it on a significant other, or in some other way wasting or secreting funds, Family Law Solutions can perform a diligent inspection of financial records to determine the extent of the potential waste. We can provide charts that will explain to the Court the misspent or unaccounted money that is missing.

Waste is a difficult claim to prove, but a thorough financial analysis from Family Law Solutions can certainly help. Family Law Solutions is also available to assist with the crafting of legal arguments regarding these issues, including proper case law and the economic calculations. Even if a waste claim might not be successful at trial, it can be leverage in negotiating a settlement.

1 Fox v. Fox, 401 P.2d 53 (1965).
2 Lofgren v. Lofgren, 926 P.2d 296 (1996).
3 Putterman v. Putterman, 939 P.2d 1047 (1997).
4 Id. at 1049.