In re Marriage of Farmer
Annotate this CaseThe issue central to this case involved a trial court's method of valuing stock options in a dissolution proceeding. After separating, Daniel and Teresa Farmer entered into a stipulated agreement dividing their community assets, including several thousand stock options Daniel had received from his employer during the marriage. Under the terms of the agreement, Teresa could decide when to exercise her share of the stock options. Before entry of the decree of dissolution, however, Daniel fraudulently exercised all of the options. The trial court was unaware of this when it awarded Teresa half of the community stock options in the final decree. When the facts came to light, Teresa moved for relief from the dissolution decree by asking the court to invoke its equitable authority to award her damages for her loss. The court assessed damages based on the present value of the stock options as calculated by Teresa's expert witness. The Court of Appeals affirmed, deferring to the trial court's equitable discretion to make Teresa whole. Upon review, the Supreme Court affirmed the Court of Appeals finding that the trial court did not abuse its discretion in calculating damages to Teresa.
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