Gill v. GillAnnotate this Case
The Supreme Court affirmed the decision of the court of appeals reversing the judgment of the district court concluding that future, contingent earn-out payments are nonmarital property because they are property acquired by a spouse after the valuation date, holding that because the parties’ interest in Husband’s company was marital property that was acquired before the valuation date, the consideration for the sale of the company was also marital property.
While married to Wife, Husband purchased an ownership interest in a company. During dissolution proceedings and after the district court’s valuation date for for marital property but before the dissolution, the company and Husband’s ownership interests in the company were sold. The purchase agreement gave the company and its owners an amount paid at the time of the sale and the right to receive future amounts. The district court concluded that the earn-out payments were nonmarital property. The court of appeals reversed. The Supreme Court affirmed, holding that the consideration for the sale of the company was marital property.