In Re Marriage of Duncan

Summary

Duncan-Hurst, an investment advisory firm run by William, was found to be community property, and the trial court valued it at the date of separation under Family Code section 2552(b) because its value came largely from William's skill and track record. It adopted the defense expert's comparable private-company sales approach ($25.5 million, community share $19.8 million) but refused his 66.7 percent discount for a hypothetical long-term employment contract. The Court of Appeal affirmed the valuation date, the method, and the denial of Carol's attorney fee request, finding no abuse of discretion.

What it means for the financial analysis

When a business's value rests on the operating spouse's personal skill, a date-of-separation valuation can be supported without showing that post-separation growth came solely from that spouse. A comparable-sales analysis that adjusts for post-separation efforts through a hypothetical employment contract will likely fail without evidence of an actual or contemplated contract and a foundation for the adjustment percentage.

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