Callahan v. Callahan
Apparent 1st Impression On Date To Value Corporate Assets
- Superior Court
- Stamford/Norwalk J.D., at Regional Family Trial Docket in Middletown
- Mar 20 2013 (Date Decided)
- Munro, J.
If a party allegedly engages in wrongful conduct after the final hearing date, the court can open the judgment and set the valuation date for corporate assets as of the date of the hearing to be held. The husband worked at Salomon Brothers until his mentor left and then decided to establish his own investment, trading and brokerage businesses, the Pentalpha entities, with the wife. In 1995, the husband owed 49 percent and served as the dealmaker. The wife owned 51 percent and served as the office manager. Previously, in May 2012, the court granted a dissolution of marriage and awarded the husband the Pentalpha entities, which the husband valued at $600,000 and the court valued at $11.7 million. The court ordered the husband to pay the wife $6 million or, if the husband sold the businesses within six months, to pay the wife 55 percent of the proceeds. The husband discovered that the wife, after the final hearing date, allegedly withdrew $632,722 in funds from the Pentalpha entities. The husband moved to open the judgment of dissolution and asked the court to use the date of the original hearing as the valuation date. Generally, the date of entry of the judgment of dissolution is the date for the valuation of assets. Ruling on an issue of apparent first impression in Connecticut, the court set the valuation date as of the date of the hearing to be held on whether the wife's conduct affected the Pentalpha entities' good will. "If the conduct has affected the good will of the company," wrote the court, "that can only be measured once the conduct is known or subject to being known or disclosable to customers, suitors for purchase and regulatory authorities." In a separate motion, the husband asked the court to consider the effect of the wife's conduct on her LinkedIn account, which she allegedly used to contact customers. The court indicated it would consider each party's conduct to the extent that the party's conduct affected the value of the Pentalpha entities.