How does a Virginia Circuit Court judge make an equitable distribution award for a couple, who do not present sufficient evidence at trial, and who are suffering economic hardships such as job losses, repossession, and a bankruptcy?

How does a Virginia Circuit Court judge make an equitable distribution award for a couple, who do not present sufficient evidence at trial, and who are suffering economic hardships such as job losses, repossession, and a bankruptcy?

In the case of Whiteside v. Whiteside, CL09-1545, the Virginia Circuit Court judge simply declined to grant equitable distribution of the marital assets and allocation of the debts given the lack of evidence, but reserved wife’s right to receive spousal support at some point in the future, as permitted by Virginia Code Section 20-107.1(D).

Applying the dictates of Virginia Code §20-107.3, the Court considered all of the equities and made its determination regarding the assets of the parties.

First, the Virginia Circuit Court judge examined the real estate holdings the parties possessed during their marriage.  The evidence revealed that the parties had borrowed $243, 500.00 to purchase a house, which they refinanced for $283, 000.00 in 2007. However, they ceased making payments on the lien in October 200, and after missing 18 payments, the bank made a foreclosure sale in February 2010. The court noted that the deficiency could be considered a marital debt, but did not have evidence to determine whether a deficiency existed.  The wife had discharged her personal liability when she filed for chapter 7 bankruptcy.  The husband indicated that he intended to file bankruptcy and was upset that wife did not file a joint bankruptcy case with him. Moreover, while the parties owned a time-share condominium in Winter Garden, Florida, the parties did not present any evidence regarding its value. Neither party wanted the property or introduced sufficient evidence to determine its value or the debt against it.  Consequently, given the lack of evidence and the judge’s questionable conclusion that wife had “bankrupted” the debt [as contradicted by 11 U.S.C. 523(a)(16), which excepts from discharge post-petition homeowner association dues and condominium assessments for as long as the debtor or trustee has a legal, equitable, or possessory interest in the property, the court declined equitable distribution of the property and debt, and instead left the parties to their civil law remedies.

Second, the Court found that all of the credit accounts of the parties were separate. The husband testified about the balance on two credit cards, but introduced no documentary evidence in support of his testimony showing a breakdown of the debt or the balances on the date of separation.  The wife denied that the balances reflected marital debt.  The Court found that husband failed to meet his burden of persuasion, declined to determine whether the husband’s debt was marital debt and refused to allocate the debts, in accordance with the Virginia Supreme Court opinion of Gilliam v. McGrady, 279 Va. 703 (2010) .

Third, in regards to household furniture, goods, and furnishings, the wife testified that the husband had already removed personal property from the former marital residence.  Neither party introduced into evidence an inventory of the personal property with values.   The husband argued that the articles he took should not be considered an equitable distribution. The court, however, again to exercise its equitable distribution powers due to the lack of evidence.

Fourth, the couple presented evidence regarding the vehicles they owned. One of husband’s luxury vehicles had been repossessed due to a failure to make the monthly payments. Another luxury vehicle worth $3,775 was sold by husband for only $600, without any explanation from husband at trial.  The wife sold husband’s inoperable pickup truck for $150 when she was notified that the vehicle had to be moved or towed by VDOT.  Wife owned a 1997 Toyota 4Runner valued at $4,420.00. Considering the equities of the parties, the Court held that the wife would keep her vehicle and the husband was allowed to keep the proceeds from the sale of his luxury vehicle.

Finally, the court examined the bank accounts, request for attorney fees, and determination of spousal support.  The court found no evidence that the parties held any joint accounts. The wife had cashed in her profit sharing account for use for the children’s college costs, and the husband cashed in his retirement from both VDOT and Wal-Mart. And although the husband testified that the parties owed Roanoke County $328.00 in taxes and $506.00 to the IRS, the court could not find any documentation to support these figures and declined to make an equitable distribution.  In considering attorney fees, the court declined both parties’ requests for awarding costs to the other. Furthermore, while the court determined that both parties had need of spousal support, neither could support the other. The wife, after being unemployed for three months, had found a job. Yet even with her job, she had a deficiency in her budget in providing for herself and her children. The husband was not voluntarily unemployed because he made a showing that he was continually looking for a job while living on unemployment. However, because of husband’s unemployment, the court reserved wife’s right to receive support in the future.

You should consult with your Virginia divorce lawyer concerning how your economic difficulties will impact equitable distribution in your divorce case.

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