Goodwill And Career Assets

Career assets are human capital assets such as:Personal goodwill, earning power, academic degrees, professional licenses, etc. – all of which form the personal earning capacity of every person.

The Israeli supreme court has recently recognized career assets as divisible joint assets of the spouses, while the principal investment in the accumulation of the career assets was in the course of the joint life or the marriage and the fruits can be attributed to such investment and where there is a significant gap in the couple’s level of income.

The rationale leading to recognition of these assets as joint divisible assets, is found in the wish to maintain consequential material equality between the spouses as compared with distributive equality, treating the human capital assets as part of such “assets” as have been accumulated in the course of the marriage and accordingly will be balanced upon the termination of the marriage (see “Property Relations Between Spouses Law”). According to this approach, a justifiable division will narrow down the gap between the spouses’ income in cases where one of the couple in the family developed his/her human capital in the course of the marriage or the joint life while the other spouse has nurtured the family and in certain cases also contributed economically and supported the partner so as to allow the partner to accumulate the human capital assets.

There is a considerable difficulty in assessing the human capital and in dividing it in practice, but the courts presently hold that this difficulty cannot serve as justification for not recognizing the human capital as a divisible joint asset and finding various ways to measure the value thereof.

The possible solutions for a division that will lead to a consequential equality between the spouses are as follows:compensation, restitution, periodic payments, or unequal distribution of the joint assets.