Finocchio v. Finocchio

Lawton, J. (dissenting).

I respectfully dissent. The concept of merger is that a professional license obtained during a marriage at some point no longer has a value of its own and loses its identity as a separate marital asset because it is subsumed into the professional practice (see, Marcus v Marcus, 137 AD2d 131, 139-140). Where a professional license and practice merge, the trial court values only the practice as a single asset and makes a distributive award (see, Marcus v Marcus, supra). A professional practice’s value is, as with any other *1047business, its present fair market value, to wit, what a willing purchaser would pay for it.

In the present case, the trial court found that defendant, since his admittance to the Bar over 14 years ago, has devoted his entire work effort to develop his law practice. This is not a new practice but, rather, one that is fully developed. Given these circumstances, defendant’s license, which was earned during the marriage, no longer has a separate value or identity but, rather, has merged into the professional practice. Indeed, the majority agrees that the license and practice have merged since a new trial is granted for proper valuation of the practice only, rather than the license and practice separately.

In valuing the practice in this case, the majority has added a new and, in my opinion, inappropriate component. In this regard, the majority holds (at 1044) that the value of the practice is its present fair market value plus the postdivorce value of "defendant’s enhanced earning capacity for the full economic life [working life] of his license to practice law.” Enhanced earning capacity resulting from obtaining a degree or license is a method of valuation used in determining the value of a license (see, O’Brien v O’Brien, 66 NY2d 576, 588). This methodology is only used, however, when a license must be valued separately because a practice has yet to develop or has not fully matured (see, Marcus v Marcus, supra). Here, we are not valuing the license because, as we all agree, the license has merged with and been subsumed into the practice. The value of the practice, as testified to by both experts in this case, is its present fair market value.

In my opinion, since the defendant’s license has fully merged into his practice, the majority incorrectly engrafts the license-valuing methodology of enhanced earning capacity onto the methodology used in valuing a practice. Where there has been a subsequent merger of a degree, skill or license into a career, profession or business, then there no longer should be a separate valuation of the degree, skill or license (see, DiCaprio v DiCaprio, 162 AD2d 944, 946 [Lawton, J., dissenting] [decided herewith]). Since Supreme Court, in accordance with the evidence submitted by the parties, has properly determined and distributed the value of defendant’s practice, I would affirm. (Appeal from judgment of Supreme Court, Onondaga County, Stone, J.—divorce.) Present—Dillon, P. J., Doerr, Green, Lawton and Lowery, JJ.