January 31, 2011

Dissipation of Assets & Attorney Fees - Indiana Divorce Law

The last posting was about dissipation versus disposition of assets.  This posting discusses attorney fees, generally, and whether a dissipating party can be held responsible for attorney fees under Indiana divorce law.   As always, this blog is not legal advice. If you have a specific interest in this issue because it affects your case be sure to consult with an Indiana divorce attorney that can analyze your specific case.  

As to attorney fees in a divorce action, Indiana statutes provide as follows:
(a) The court periodically may order a party to pay a reasonable amount for the cost to the other party of maintaining or defending any proceeding under this article and for attorney’s fees and mediation services, including amounts for legal services provided and costs incurred before the commencement of the proceedings or after entry of judgment.
 Ind. Code § 31-15-10-1. 
There are a variety of factors the court will consider when determining whether to award attorney’s fees and the amount to be awarded. O'Connor v. O'Connor, 253 N.E.2d 250 (1969). “When making an award of attorney fees in a marriage dissolution case, the trial court must consider the resources of the parties, their economic condition, the ability of the parties to engage in gainful employment and to earn adequate income, and such other factors that bear on the reasonableness of the award.” In re Lewis, 638 N.E.2d 859, 861 (Ind.Ct.App.1994).  In considering the resources of one or both parties, “[t]he fact that one party has assets from which payment could be made, [ however,] does not, of itself, make an award for that party’s benefit improper.”  Taylor v. Taylor, 436 N.E.2d 56, 60 (Ind. 1982). 

Additionally, “[m]isconduct that directly results in additional litigation expenses may properly be taken into account in the trial court's decision to award attorney fees in the context of a dissolution proceeding.” Lewis v. Lewis, 638 N.E.2d 859, 861 (Ind.Ct.App.1994).  “[T]he trial court may look at the responsibility of the parties in incurring the fees and whether they were generated in bad faith.”  Hanson v. Spolnik, 685 N.E.2d 71, 80 (Ind. Ct. App. 1997).  

Therefore, if a court finds that dissipation occurred, and finds that the party's dissipation was in bad faith, the court certainly can award fees associated with the misconduct.
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