When thinking of marital assets to be distributed during a divorce, litigants prepare for battle over homes, pensions and investment accounts. Unschooled or poorly advised litigants may overlook valuable assets.
For instance, what happens if one of the parties attends school or attains an educational degree during the marriage.
The Appellate Division re-affirmed the well settled rule of law that
an academic degree may constitute a marital asset subject to equitable distribution, even though the degree may not necessarily confer the legal right to engage in a particular profession. While the MBA degree might not actually be a prerequisite to the defendant’s employment, the record demonstrates that the degree substantially increased her future earnings, and therefore the plaintiff is entitled to an equitable share of its value, with the proper valuation date being the commencement of this action.
In the recently decided case of Judge v. Judge, the wife “stopped working outside the home in order to take care of the parties’ first child. She primarily stayed home and took care of the parties’ children until the fall of 1993, when she enrolled in a program for a Masters of Business Administration degree (hereinafter an MBA degree) at a college where the plaintiff was employed as a professor. In the spring of 1994, the defendant was hired by the Federal Reserve Bank (hereinafter the FRB), through the college placement office, and she received her MBA degree in February 1997. The defendant’s first job with the FRB was as a Management Information Analyst, and at the time of trial she was an officer at the FRB and vice-president of the FRB’s Cash and Custody Division.”
The fact that the degree is an asset to be equitably distributed should not be in dispute. Generally, only the value of the degree is open for debate and is determined through the use of expert testimony. It is quite common for the court to appoint a single neutral evaluator to determine the value of a degree, license or enhanced earning capacity.
In the Judge case, based upon expert testimony at trial, the Court found that the value of MBA was $565,000 and find that the plaintiff was entitled to 25% thereof, for an award in the sum of $141,250.