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The Valuation of a Law Firm in a Divorce Proceeding Should Be Measured by Fair Market Value.
by Peter M. Walzer and Edward Poll*

A law practice has value even apart from its old couch, obsolete library, barely functioning IBM 386, accounts receivable, and whatever work is in progress. In addition to these assets, a practice may have goodwill, but the value of that goodwill may be the subject of much dispute. Nevertheless, in a divorce action, a court may find not only that a lawyer has goodwill but also that the lawyer's spouse must be compensated for that goodwill. Regrettably, the chance that a marriage will end in divorce is about 50 percent. Goodwill has various definitions, but the controlling definitions used in a divorce proceeding is found in the leading case on professional practice valuation - In re Marriage of Foster.1





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