Virginia Family Law
A Blog by Jason A Weis, Esq.
Virginia & Maryland Family Law Attorney

Relationship Advice From Divorce Lawyers


February 10, 2015

Relationship Advice From Divorce Lawyers

Recently, Emma Johnson of Forbes Magazine had the rather novel idea of asking divorce lawyers across the country for relationship advice.  I was one of them.  Seems akin to asking for health advice from a doctor who performs autopsies, which, when you think about it, makes sense.  Here is a link to that story:  Relationship Advice From Divorce Lawyers.



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Valuing a Business and Finding Hidden Money During a Virginia Divorce


February 2, 2015

Valuing a Business and Finding Hidden Money During a Virginia Divorce

Charlie Rains Charles Rains is the Founder of C. W. Rains & Associates, Incorporated located in Annapolis, Maryland.  He is one of the “go to” business valuation and financial forensics experts Northern Virginia attorneys can rely on in highly contested divorce cases.  He has the necessary credentials:  he’s a CPA (certified public accountant), an ABV (accreditation in business valuation), CFF (certified in financial forensics) and ASA (accreditation as a senior appraiser).  Perhaps more importantly though, he has a talent for breaking down complex financial structures and communicating about them in language a judge (or family law lawyer) can understand.  He’s worked with some very talented family law lawyers in the D.C. Metro area and I thought his perspective would be useful to both attorneys and spouses involved in contested divorces. Describe the type of work you typically perform in a divorce case?

  • Typically my work includes performing a business valuation/appraisal of a parties’ privately held company, forensic tracing of marital versus separate property, and/or searches for hidden assets.

Generally, how do you go about valuing a business for divorce purposes?

  • When valuing a company for divorce purposes, in its most basic sense, I analyze the present value of the future expected income stream; the aggregate value of the underlying assets net of liabilities; and arms-length transactions of similar entities or securities compared to the subject. In other words, how is an investor going to get cash back out of the company and when? As they say “cash is king.”

Assuming you are working with a business owner who sees divorce on the horizon, what types of conversations would the two of you be having?

  • Typically I am not brought in until after the business valuation is needed, but under your assumption the discussions would most likely involve determining if any portion of the business is considered separate property, whether by gift, inheritance, formation prior to the marriage or from sources that can be traced back to separate property, amongst other assertions.

Can you give readers some examples of interesting methods you’ve seen people use to manipulate the value of a business for divorce purposes?

  • It amazes me some of the methods some individuals use to “manipulate value”, but I don’t want to draw any attention to any bad ideas that I would rather see go away as it would be adding fuel to the fire. But attorneys should keep in mind that a small change in the discount rate under the income approach or changes in the pricing multiples under the market approach can have a substantial effect on the value.

What are some of the biggest mistakes you see attorneys make when it comes to business valuation?

  • Probably the most common mistake I see is, not getting the valuation expert involved early enough in the case. However, one of the biggest mistakes that I have seen was an attorney who requested a valuation as of the date of trial, however, during the process the opposing attorney had filed a motion that a different valuation date, date of separation, be used. The date of separation was a few years prior to trial. The attorney failed to inform the valuation expert of the motion. The valuation expert did not prepare a second valuation as of the date of separation. At trial, the judge did not allow the valuation expert to testify as to the value at the date of separation. Needless to say, the attorney’s client did not receive a favorable outcome.

What are some of the common areas a financial forensics expert might be needed in a contested divorce case?

  • Typical forensic accounting services in divorce matters include assistance with discovery, identification of assets, liabilities and income to the marital estate; tracing of marital/non-marital property; searching for hidden assets, undervalued assets, or dissipation of assets; income analysis; and assistance with depositions.

In your view, what are some of the most common ways people attempt to conceal or cloud their financials during a contested divorce? Have you encountered any particularly elaborate lengths people have gone to in that regard?

  • It is common for individuals to deflate income, increase both business and personal expenses, accelerate payment of personal expenses, attempt to hide assets or in some extreme cases I have seen individuals attempt to move funds offshore and sell commercial property at a loss only to repurchase the property after the divorce.

What are some of the mistakes you see attorneys make when it comes to tracking or tracing money?

  • One mistake that is made is, chasing after minimal amounts of cash or assets. Depending on the span of time that tracing is required and the number of accounts or assets that need tracing, the cost and time it takes to perform a forensic tracing exercise can quickly exceed the benefit.

Logo  What’s the best $100.00 you spent in 2014?

  • The best $100 spent in 2014 would be $100 towards the cost of our family vacations. I cherish each and every one of them.

What’s the book you’ve given most often as a gift?

  • This may sound funny, but the book I have given most often as a gift seems to have been to high school graduates and it is Oh, the Places You’ll Go! By Dr. Seuss.

What films do a particularly good job of exemplifying what you? I can’t think of too many films that exemplify the type of work that I do, but the best example that I can think of would be The Untouchables.  The character, Elliott Ness, was a Forensic Accountant for the Justice Department’s Prohibition Bureau.  He was best known for bringing down Al Capone for tax evasion.



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Virginia Family Law: Who Gets Divorced?


January 9, 2015

Can Money Save My Marriage?

We know it can’t buy you love.  The Beatles taught us that.  (It can, though, certainly buy you companionship.  See Dan Belzerian.)  And, of course, you need a bit of money for the basics (e.g. safe shelter, food, medicine, etc.), but after that does having more money make divorce more or less likely?  The highly publicized divorce of Harold Hamm, who is reportedly worth 8 BILLION DOLLARS, seems to suggest money makes little difference.  In 2014, my firm handled divorces for individuals making 5-figure incomes and individuals making 8-figure incomes in Fairfax and Loudoun County and, perhaps surprisingly, the inevitable lists of marital woes in both income camps were strikingly similar.

“If Only I Was More Romantic.”

Grand romantic gestures might buy you some time (and you may feel you owe it to yourself to try), but the separation and impending divorce of best-selling author, Nicholas Sparks, sometimes referred to as the “King of Romantic Story Telling,” seems to suggest that romance isn’t the silver bullet to saving a marriage either.  In Virginia, it only takes the intent of one party to get a divorce.  Last year I heard about some amazingly romantic and generous things people did in an effort to save their marriages.  Many times, however, I heard about them from my clients who were in for a divorce consultation.

“If I Was Smarter, I Wouldn’t Be Getting Divorced.”

That might be true in a general sense, but, again, I represented some highly educated people (e.g. doctors, lawyers, professors, entrepreneur’s) who were all getting divorced.  Even “smart” people occasionally do dumb things.  Below is a graph charting divorce rates against various levels of education.

Divorce and Education

Perhaps It’s Just That Time of Year.

Without question I see a predictable ebb and flow of new divorce clients during the year.  The beginning of the new year and beginning of the summer are probably the busiest times in our office for new client divorce filings.  Surely divorce is more complicated than New Year’s Resolutions and members of the opposite sex in bathing suits?

Divorce Chart

Just some thoughts.

 



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About

My experience and background reflect the hallmarks of success one must demand of a lawyer in Northern Virginia's legal landscape.  As a native of this area, I have here focused my practice on providing sound and balanced representation to clients navigating the difficult legal waters of family law, including contested divorce, custody, visitation, spousal and child support, and equitable distribution.  More >>>

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Jason A. Weis, Esquire
Curran Moher Weis
10300 Eaton Place, Suite 520
Fairfax, Virginia 22030

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Phone: (571) 328-5020

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Thank you for taking the time to read this blog. I hope you find the information here as enjoyable to read as I find to write. Please note that reading this blog does not create a legal relationship between you and Jason A. Weis, Esquire or any other attorney associated with familylawva.com. Moreover, all postings on this blog are merely attorneys' commentary on the state of family law in the Commonwealth of Virginia. THE POSTINGS ARE NOT LEGAL ADVICE – if you have a legal issue or question, I strongly encourage you to contact a lawyer. I would be pleased to refer you to someone if I am able.