The parties to a divorce owned a daycare center. The trial court needed to know the fair market value of the business. The trial court needed to place a specific value on the asset. The court did not learn much from the testimony of the parties. Also, the documents submitted into evidence provided little information. The trial court used an alternate means of assessing the value of the business.
The court noted the parties agreed wife would take an annual draw of $85,000. This was from the income generated by the daycare center. That number was then multiplied by three. The trial court felt the business could be viable for a minimum of three years. The number of years (3) used was based on the economy and the financial history of the business.
The court then subtracted $20,000 in past-due rent and damages from flooding. The result was for a total value of $235,000. Husband appealed. He said the trial court’s analysis of the value of the business was wrong. He wanted the Appellate Court to have the case reheard by the Trial Court.
A party may decide not to offer evidence of an asset’s value. That party cannot later complain about the court’s decisions about that asset. Parties should not be allowed to benefit on review from their failure to introduce evidence at trial. Otherwise, sending the case back to the trial court would only make the case go on and on. The courts would be clogged with issues which should have been disposed of at the initial hearing.
Husband agrees that neither he nor wife presented evidence at trial regarding the value of the business. Husband contends, however, that stipulations by the parties showing the business had deposits of $336,709.97 in 2008 and $440,600.45 show that the business was worth more than $235,000. This should have been a factor the trial court used in determining the value of the business.
But, this alone is not sufficient to determine the value of the business. Evidence of other factors would be needed to make a proper valuation. Factors such as good will, fixed assets, and business-related expenses. Neither party presented meaningful evidence of the business’s value. The Appellate Court could not say that the trial court’s method of valuation was an abuse of its discretion.
In re Marriage of Abu-Hashim, 2014 IL App (1st) 122997.
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