Division of Business Assets in Divorce in North Dakota
In North Dakota, the division of business assets during a divorce is governed by the principles of equitable distribution. This means that the court seeks to divide the marital property, including business assets, in a manner that is fair and just, but not necessarily equal. The court’s decisions are guided by the North Dakota Century Code and the rules of court.
Equitable Distribution of Property
According to North Dakota Century Code 14-05-24, when a divorce is granted, the court is required to make an equitable distribution of the property and debts of the parties. This includes business assets that were acquired or developed during the marriage. The valuation date for marital property and debt is either the date mutually agreed upon between the parties or, if no agreement is reached, sixty days before the initially scheduled trial date.
If there is a substantial change in the value of an asset or debt between the date of valuation and the date of trial, the court may adjust the valuation of that asset or debt as necessary to effect an equitable distribution. The court is required to make specific findings that another date of valuation is fair and equitable.
Business Assets and the Civil Service Retirement System
In cases where one party to the divorce is covered by the civil service retirement system or other government pension system in lieu of social security and is not entitled to receive full social security benefits, the court is required to compute what the present value of the social security benefits would have been to the party with the government pension during the covered period and subtract that amount from the value of the government pension in order to determine the government pension’s marital portion (North Dakota Century Code 14-05-24).
Case Management and the Division of Business Assets
Under Rule 8.3 of the North Dakota Rules of Court, within 30 days after service of the complaint, the parties and their attorneys must meet in person or by electronic means to prepare a joint informational statement and a preliminary property and debt listing. This includes information and documentary evidence relating to the existence and valuation of business assets.
Restraining Provisions and Business Assets
According to Rule 8.4 of the North Dakota Rules of Court, a summons in a divorce or separation action must include restraining provisions that prevent either spouse from disposing of, selling, encumbering, or otherwise dissipating any of the parties’ assets, including business assets, except for necessities of life or for the necessary generation of income or preservation of assets, or for retaining counsel to carry on or to contest the proceeding. If a spouse disposes of, sells, encumbers, or otherwise dissipates assets during the interim period, that spouse is required to provide to the other spouse an accounting within 30 days.
In conclusion, the division of business assets in a divorce in North Dakota is a complex process that involves the application of the principles of equitable distribution, the valuation of assets, and the enforcement of restraining provisions. It is always advisable to seek legal counsel when dealing with such matters.