The Indiana Court of Appeals has affirmed a Hendricks County Superior Court decision in a highly contested divorce case, upholding the property division and child support orders. The case involved allegations of fraudulent asset transfers, uncooperative behavior from the husband and his parents, and a complex financial history. The court’s ruling largely sided with the wife, Navneet Aulakh, against her ex-husband, Tejinder Aulakh, and several joined parties, including his parents and two limited liability companies.
Background of the Case
The couple, Tejinder and Navneet Aulakh, married in December 2012 and have one child. Tejinder, a software engineer, earned a substantial salary and received restricted stock units (RSUs). Navneet is a dentist. The marriage was marked by early conflict, including a domestic violence incident shortly after their child’s birth. The couple initially lived in California but moved to Indiana in 2016.
The divorce proceedings were complicated by allegations that Tejinder transferred significant marital assets to his parents, Mohinder and Harbhajan Aulakh, in an attempt to shield them from the divorce settlement. The parents then allegedly transferred assets to two LLCs, Northlake Investment LLC and Greenhill Investment LLC.
Key Issues and Court’s Findings
The Court of Appeals addressed several key issues raised by the husband and the joined parties:
1. Inclusion of Assets in the Marital Estate: The court examined whether the trial court correctly included assets transferred to Northlake and Greenhill in the marital estate. The joined parties argued that the trial court erred in denying their motion for summary judgment, claiming the evidence didn’t directly link the funds to marital assets. The appellate court disagreed, finding that the wife presented sufficient evidence of fraudulent transfers, including multiple “badges of fraud,” to justify including the assets in the marital estate. These badges included the timing of the transfers, the lack of consideration, and the husband’s continued control over the assets. The court stated that the wife did not need to prove the exact funds were transferred but only that there was a pattern of fraud.
2. Valuation of Marital Assets: Tejinder challenged the valuation of certain investment accounts, arguing that the trial court should have used a more recent valuation date to reflect the fluctuating values of stocks. The court acknowledged that a trial court can abuse its discretion by picking a valuation date that doesn’t account for significant changes in asset value. However, the court found that, in this case, Tejinder’s control over the accounts and the delays caused by his conduct justified the trial court’s choice of valuation dates.
3. Division of the Marital Estate: Tejinder argued that the trial court abused its discretion by ordering an unequal division of the marital estate. The trial court awarded Navneet 58% of the marital estate, deviating from the usual presumption of a 50/50 split. The appellate court upheld this decision, citing Tejinder’s conduct, including the fraudulent transfers and lack of cooperation during the proceedings. The court found that this conduct warranted a deviation from the equal division, as it considered the dissipation of marital property.
4. Child Support: Tejinder challenged the trial court’s child support calculation, arguing that the court improperly included rental income and failed to account for an alleged overpayment. The court found that the trial court properly included estimated rental income in Tejinder’s income calculation, as allowed by Indiana law. The court also rejected Tejinder’s claim of overpayment, finding the initial child support order was supported by the evidence and that Tejinder failed to demonstrate clear error.
Fraudulent Transfers and Uncooperative Behavior
A central theme of the case was the husband’s alleged fraudulent transfers of assets. The trial court found that Tejinder transferred significant assets, including real estate and investment stocks, to his parents after the initial divorce petition was filed. The court also noted the parents’ lack of cooperation with discovery requests, including evasive testimony and a refusal to provide financial documents. The appellate court emphasized the trial court’s findings regarding the credibility of the husband and his parents, noting that the trial court was in the best position to assess the witnesses’ demeanor and testimony.
The court also highlighted the disruptive behavior of Tejinder’s father during a hearing, which resulted in a recess and a subsequent order to join the parents as necessary parties. This behavior further underscored the contentious nature of the proceedings.
Impact of the Ruling
The Court of Appeals’ decision affirms the trial court’s handling of a complex and acrimonious divorce case. The ruling reinforces the importance of transparency and cooperation in divorce proceedings. Moreover, it affirms the court’s ability to address fraudulent asset transfers and to consider a party’s conduct when dividing marital property. The decision also provides guidance on the valuation of assets and the calculation of child support in cases involving complex financial dealings.
The case serves as a warning to those who attempt to hide assets or obstruct the legal process during a divorce. The court’s willingness to include assets fraudulently transferred and to deviate from an equal division of property based on a party’s conduct sends a clear message about the consequences of such actions.