Mopping Up After the Divorce

January 11, 2016 § Leave a comment

What do you do when the divorce trial is concluded, the final judgment has been entered, and the post-trial motions have been disposed of? If there’s not going to be an appeal, you just make sure your bill is paid, shake your client’s hand, usher him to the door, wish him luck, say farewell, and shut the door behind him, right?

Well, not exactly.

Do you know whether your client still has his ex-wife named in his will? What about as beneficiary of his life insurance, or survivor on his IRA or 401(k)? Does he still have his ex as POD or survivor on any checking or securities accounts?

I read an article written by a financial advisor recently in which she related an encounter with a newly-married couple, both of whom had been divorced several years before. Both husband and wife had wills that still named ex-spouses as beneficiaries, and the same with life insurance and retirement accounts. When she asked them why they had not been changed, both replied that no one had advised them that they should.

A case in my court recently brought up a similar problem. The wife in the divorce case insisted that she owned the marital residence because the PSA in her 2007 divorce (more than 8 years ago) provided that her ex would execute a special warranty deed conveying his interest to her. Only problem: he never did. So, since May of 2007 she has remained a joint tenant with right of survivorship with that man. If she had died before he tended to that little bit of finish-work, her estate would have to pay another lawyer to do what her divorce lawyer should have done in the first place, and it probably would have involved courtroom billable hours.

Years ago, a man hired me to obtain a QDRO to divide his 401(k) account. He had represented himself in the divorce that took place nearly ten years before. When the divorce was final, he had asked the lawyer who represented his wife how to go about getting the retirement account divided. The lawyer pointed out that he did not represent him, and virtually slammed the door in his face. When the client at last decided to get remarried, he thought that it was time to get the matter tended to, so he hired me. Here is how the PSA read:

The parties agree that wife shall receive the sum of $60,000 from Husband’s 401(k) account.

That was all it said. [For a post on what that 401(k) language should have included, click here]

So we filed a petition for the court to enter a QDRO for her to receive exactly that — $60,000. After being served with process, she went back to her divorce lawyer, who called me and pounded the table, insisting that she was entitled to ten years’ worth of interest. I pointed out that the agreement he had drafted did not have a time frame for payment, that neither party was obligated by the agreement to prepare a QDRO, that there was no interest provision, and that the only definite thing about it was the amount. He called me back a few days later and said his client was willing to settle for the $60,000, and they signed the QDRO, which was entered and the matter finalized. For ten years my client earned money using his ex’s money. Had her lawyer acted in her best interest, he would have gotten that QDRO entered immediately after the divorce judgment.

You might well ask, as I did when my client first hired me, why was his ex not screaming for her money? Well, in the ten years after the divorce she asked him about once a year if he still had her money. She was satisfied with his answers, but apparently no one ever advised her what she was losing by not getting that QDRO entered.

You might also inquire whether my client was unjustly enriched. I would agree that he was, indeed, enriched, but not unjustly so. He did not sleep on his rights. He did not draft the agreement. It was not his obligation to calculate her separate interest. She was wise to want to settle for the principal sim, because if she had wanted to obtain a court ruling that he had been unjustly enriched, and directing him to disgorge any interest received on her money, she would have had to pay the attorney to pursue it, and likely would have  had to pay a CPA to calculate the interest and testify as an expert. After paying those folks, she would be lucky if she got to walk away with the $60,000.

Another nightmare scenario involves credit cards. I represented a man in a routine irreconcilable differences divorce. The PSA provided that each would pay the debts in his or her own name, as well as debts incurred in the name of or against the credit of the other. Thank goodness for that specific language, because he came in a year or so later with a letter from a credit card company reporting that an account in joint ownership was in default and making demand on him to pay more than $10,000. Turns out that shortly before the separation his wife had opened one of those accounts the company had solicited by mail, signing her husband’s name, and kept the account concealed from him. Then, after the divorce, she used it to supplement her income. We notified her that she had so many days to pay the account in full or we would sue. She borrowed money from her family, paid it off, and the account was closed. My client’s credit rating took a hit, but that and a modest legal fee were his total damages.

Lesson learned: it might not be a bad idea in the course of a divorce case to have your client run a credit check.

All of this boils down to a simple professional consideration that I have mentioned many times here: When the case is concluded, your client wants to be finally done with it, and she does not want to have to pay another attorney to clean up after you.

Actually, many of these things can be tended to before the divorce is concluded. That deed can be prepared, joint accounts closed, wills changed, bills of sale signed, agreed QDRO signed by the parties, and so on, with the originals held in the lawyer’s file until the judgment is entered.

When you are through with the divorce, help your client through the aftermath. Make sure she revokes all wills naming the ex as a beneficiary. Make sure there are no financial assets not covered by the divorce judgment that are joint, or have survivorship provisions. Make sure that there are no outstanding joint debts not addressed in the divorce. If a QDRO or deed is required for your client’s benefit, get it done ASAP. People are dying every day. You don’t want one of them to be the person you need to finish up your work.

Say What You Mean and Mean What You Say

January 4, 2016 § 1 Comment

Lee and Leslie Voulters were divorced from each other in 2004 on the sole ground of irreconcilable differences. The divorce judgment incorporated their PSA, which provided that Lee would pay Leslie lump-sum alimony in the sum of $1.08 million at the rate of $10,000 a month until paid in full. He also agreed to maintain a policy of life insurance on his life with a benefit of $1.08 million, with Leslie as beneficiary.

When Leslie filed a contempt action in 2013 charging Lee with missing some lump-sum payments and with failing to provide proof of life insurance, Lee counterclaimed, asking the court to interpret the PSA that the purpose of the life insurance was to protect Lee’s payment of lump-sum alimony, and that the obligation would terminate when the lump-sum alimony was paid in full.

Spoiler alert: There is no provision in the PSA that links the life insurance requirement to the lump-sum-alimony requirement.

Here are the pertinent parts of the agreement:

LUMP SUM ALIMONY/SPOUSAL SUPPORT

Lee shall pay spousal support to Leslie, in the form of lump sum alimony, the total sum of $1,080,000.00, payable in monthly installments of $10,000.00 each for a period of nine years. Such payments for support shall be due and payable by automatic bank transfer from Lee’s checking or other account directly into Leslie’s checking account, commencing on the fifth day of April, 2004, and shall so continue for one hundred and seven consecutive months thereafter. Lee’s obligation to pay such support to Leslie shall be fully vested upon the entry of a Final Judgment of Divorce in this cause, and shall not be modifiable. Lee’s obligation to pay such support shall not terminate upon Leslie’s death or remarriage, nor shall it terminate upon Lee’s death. However, despite the conventional definition of lump sum alimony[,] . . . these payments by Lee to Leslie under this Agreement shall be taxable to Leslie, and deductible by Lee, for state and federal income tax purposes.

LIFE INSURANCE

Lee agrees to maintain life insurance on his own life in an amount not less than one million, eighty thousand dollars ($1,080,000.00), naming Leslie as primary beneficiary thereon. Proof of such insurance coverage shall be furnished to Leslie within fifteen (15) days following the date of execution of this Agreement. Furthermore, Lee shall direct his insurance carrier to provide coverage information to Leslie at least twice a year if requested by Leslie.

. . . .

EFFECT OF AGREEMENT

. . . .

The respective rights and obligations of the parties hereunder are deemed independent and may be enforced independently irrespective of any of the other rights and obligations set forth herein. This Agreement contains the entire understanding of the parties, who hereby acknowledge that there have been and are no representations, warranties, covenants, or understandings other than those expressly set forth herein.

RELEASE AND WAIVER

Subject to the provisions of this Agreement, each party has released and forever discharged . . . his or her heirs, legal representatives, Executors, Administrators, and assigns . . . from all causes of action, claims, right or demands . . . in law or in equity . . . except . . . causes of action for divorce or separation action now pending . . . . Each party releases, waives, and relinquishes any and all rights . . . to share in the estate of the other party upon the latter’s death . . . . (Emphasis added.)

Both parties offered testimony about their intent in negotiating the language into the agreement. Lee argued that the agreement was ambiguous because it had no termination date. Leslie argued that she negotiated it for support, which she needed because her estate was meager in comparison to Lee’s.

One question before I tell you how the chancellor ruled: do you see anywhere in that language quoted above any link between the life insurance obligation and the lump-sum alimony?

The chancellor ruled that the agreement was unambiguous, and that it did require Lee to maintain the life insurance regardless of the status of the lump-sum payments. Lee appealed.

On December 8, 2015, the COA affirmed in Voulters v. Voulters. The opinion by Judge Barnes includes a nice recitation of the law of contract interpretation, life insurance and insurable interests, and even attorneys fees in contempt actions and on appeal.  I definitely commend it to your reading.

What I want to focus on here is this: If you want your agreement to mean a particular thing, then make sure there is language in it that says that particular thing. Remember that when the judge is called on to interpret a contract, she is bound by the language within the four corners of the document, and she may not accept parol evidence to vary or “explain what the parties meant” by those terms unless she first finds the agreement to be ambiguous. Just because Lee did not include a termination date for his life insurance obligation, that did not render the agreement ambiguous. It rendered instead the meaning that it had no termination date. In other words, it meant exactly what it did and did not say.

Be careful in your draftsmanship. Take time to make sure it says exactly what your client needs it to say. I think I was saved a hundred times or more by the simple practice of drafting the agreement and setting it aside for at least a day. I would then pick it up and read it afresh, often catching something that could be read two ways, or was simply not clear enough to do the job. Sometimes I would imagine myself to be another person altogether, looking at it as an outside observer. Anything to get an objective perspective.

Remember that some day someone entirely unconnected with the negotiations and the emotion of the divorce case is going to be reading your work with absolutely none of the knowledge that you had when you drafted it. It may be a judge, or it may be another lawyer having to represent your client, or — heaven forbid — a lawyer looking for a cause of action against you. That’s why it’s critical when you draft an agreement to give some thought and care to the words, phrases, and language construction that you use. That’s what your client is paying you for: to have absolutely no more trouble out of this matter after the final judgment is entered.

What You Need To Prove for Homemaker Services

December 14, 2015 § Leave a comment

In equitable distribution, one of the factors the court is required to consider is “Substantial contribution to the accumulation of the property … ” by … “Direct or indirect economic contribution …” Ferguson vs. Ferguson, 639 So.2d 921, 928-9 (Miss. 1994).

Over the years since Ferguson the courts have recognized that a homemaker’s contribution is to be recognized as an indirect contribution. In doing that, I think most of us have accepted a modicum of evidence on the point to support a finding. But is that enough?

In the divorce trial between Rodney and Courtney Williams the chancellor made this finding that:

“the wife was the homemaker of the parties[ and] that the husband earned the majority of the financial income. This is reflected by the domestic services rendered by [the wife] shown during the periods of time in which the grandchildren lived in the home, and she, as well as the husband, took care of them. I find that both have contributed equally toward the acquisition of property[—]he directly financial[] and she through domestic and in-kind services. Accordingly, I find that both are entitled to an equal distribution of those properties.”

To be honest, I think most chancellors make similar findings and conclusions. On appeal, Rodney took issue with the chancellor’s statements, arguing that Courtney had made only meager contributions.

In the case of Williams v. Williams, handed down November 17, 2015, the COA found that the chancellor’s findings were not supported by substantial evidence on homemaker services, and remanded for further proceedings. Judge Irving wrote for the majority:

¶35. In Lowrey v. Lowrey, 25 So. 3d 274, 287 (¶31) (Miss. 2009) (citation omitted), the Mississippi Supreme Court explained:

[T]he concept of homemaker services rests on a showing that the homemaker has contributed to the economic well-being of the family unit through the performance of the myriad of household and child-rearing tasks. In valuing this service[,] consideration should be given to the quality of the services. For example, a homemaker who, over the course of the marriage, has been frugal in the handling of homemaker expenditures and has thereby enhanced the family assets is entitled to a more equitable return than one who has been extravagant.

¶36. In this case, the record does not establish the extent of Courtney’s contribution toward the acquisition of the marital property. It appears that the chancellor mistakenly thought Courtney was a stay-home spouse and grandmother. As noted, Courtney worked during the course of the marriage, working eleven of the twelve years of marriage at one place, where her net income was approximately $1,600 per month. The record does not inform us where Courtney worked during the first year of the marriage or how much she earned during that year. The parties had no children together, and there is no testimony in the record regarding the division of the household duties. Although Courtney took care of the grandchildren in the home for some period of time, we note that the grandchildren were her grandchildren, but not Rodney’s grandchildren. It appears that the chancellor placed some weight on this fact in determining that Courtney was a homemaker and that her grandchild-caring duties contributed to the acquisition of the marital estate. The record reflects that Rodney paid the majority of the household expenses and the entire mortgage note on the marital home. It further reflects that Courtney deposited only $250 biweekly in a joint bank account to help with the household expenses but routinely withdrew money from that account for other purposes unrelated to household expenses. And the record is silent as to any other financial contributions that Courtney may have made during the marriage. Therefore, there is not substantial evidence in the record supporting the chancellor’s finding that the parties “both have contributed equally toward the acquisition of property[—]he directly financial[] and she through domestic and in-kind services.”

 A few takeaways:

  • The chancellor here believed that Courtney’s contribution to the household should have been recognized, but there was simply not enough evidence to support his conclusion. Unless you really want your case to be reversed and remanded, it’s up to you to develop the evidence on the record that will support the judge’s findings. Here, the chancellor could just as easily have found against Courtney on the factor, which could have adversely impacted her equitable distribution. Read Lowrey and take it to heart. Use it as a template in your next equitable distribution case.
  • If you represent the homemaker and your case is weak on this factor, make sure you bulk up your proof on the other factors, and try to convince the judge that this is not the key factor to consider in making a division. Remember that all of the factors do not have equal weight; the weight to be accorded to each varies from case to case, depending on the facts.
  • The converse is true if you represent the direct contributor. Emphasize the direct contribution in terms of its role in the acquisition and appreciation in value of the marital estate.
  • Never assume that the judge’s findings will make up for gaps in your case. If the judge stretches to make an assumption, you could find the case ricocheting back to you because those findings are not supported by substantial evidence. Client’s don’t like having to pay for a do-over.

 

No More Heightened Scrutiny, But …

November 23, 2015 § Leave a comment

Back in April of last year I pondered the COA’s decision in Burnham v. Burnham, which affirmed the chancellor’s rulings on child support and equitable distribution in a divorce, but subjected his findings to “heightened scrutiny” and “less deference” because he adopted one side’s proposed findings of fact and conclusions of law verbatim. That post is here.

Dissatisfied with the COA’s affirmance, Matthew Burnham filed a petition for cert, which the MSSC granted. One issue he raised was the chancellor’s verbatim adoption of the other side’s proposed findings of fact and conclusions of law.

In ¶7 of the MSSC’s opinion in Burnham v. Burnham, handed down November 12, 2015, Justice Dickinson stated:

In Bluewater Logistics, LLC v. Williford, we abandoned the rule that a chancellor’s decision to adopt a party’s proposed findings of fact was subject to “heightened scrutiny.” A chancellor’s factual findings , even those adopted from a party, are reviewed for an abuse of discretion. [footnotes omitted]

So that would seem to be the last word on that subject.

This case does, however, highlight a pitfall of proposed findings. The MSSC reversed because several of the chancellor’s findings of fact, particularly those upon which he based a finding of dissipation of assets, were unsupported by evidence in the record. Those findings of fact were submitted to the chancellor by the attorneys for Mrs. Burnham. Although the chancellor had the duty to satisfy himself that the proposed findings he adopted were accurate and supported in the record, the first duty was on her attorneys to ensure that their proposed findings were accurate. As the outcome of this case illustrates, if you play loose with the facts, it can cost your client down the road.

Chancellors have different approaches to proposed findings. Some ask for them in many cases, particularly complicated ones. Others have told me that they do not like them because lawyers tilt them in favor of their clients. Still others, as I do, call for them selectively.

If you’re going to offer proposed findings, make sure you draft them like the judge is supposed to — relying only on facts in evidence and drawing fair inferences, and applying the law as it is applies. If you use proposed findings as a partisan opportunity, you just might snatch defeat from the jaws of victory.

The Disappearing Child Support Arrearage

November 12, 2015 § 3 Comments

Occasionally some lawyer will approach me and ask that I sign an Agreed Judgment, signed off by all concerned, that settles a contempt issue. The petition charged that the respondent had something like a $3,500 arrearage, but now the judgment says he is current. “What happened to the arrearage?” I ask. The answer is something like, “Oh, we agreed to let that go if he would agree to supervised visitation from now on,” or “He really owes $3,500, but we agreed to forgive that if he would just pay on time in the future.”

Well, you just can’t do that, not even by agreement.

In the recent COA decision in Caldwell v. Atwood, handed down November 3, 2015, the court noted at ¶20 that, “While the law allows for credit to be made for child-support payments through additional physical support by the noncustodial parent, it does not permit those payments to simply be ‘purged,’ whether by an agreement or order.”

This is a subject about which I have posted here before. You simply can’t contract away an arrearage, and, for that matter, you can’t contract away your minor children’s right to future support.

In Caldwell, the chancellor had found Thomas Atwood in arrears in child support, but did not adjudicate an amount, or order him to pay it. Instead, the chancellor ordered him to “purge” himself of contempt by paying future support equal to 14% of his adjusted gross income. The COA reversed, holding that it was error for the judge in essence to forgive the arrearage. As the court went on to say in its decision:

¶19. It is well settled that “court-ordered child-support payments vest in the child as they accrue and may not thereafter be modified or forgiven, only paid.” [Harrington v. Harrington, 648 So.2d 543, 545 (Miss.1994) … at (¶14) (quoting Varner v. Varner, 588 So. 2d 428, 434 (Miss. 1991)). “Such benefits belong to the child, and the custodial parent has a fiduciary duty to hold them for the use of the child.” Id. at (¶13) (quoting Smith v. Smith, 20 So. 3d 670, 674 (¶13) (Miss. 2009)).

The COA remanded the case for the trial court to determine the amount of arrearage owed to Caldwell, and to formulate a payment plan.

On a related point, there seems to be a vogue whereby the divorcing parents agree to joint legal and physical custody, and they use that arrangement to justify no child support, I guess due to the “shared custodial arrangement.” I do not believe in most cases that this is in the best interest of the children. To me, the custody arrangement is being driven not by what the parents truly believe is best for the children, but rather by the desire to create a mechanism that the judge will approve that will eliminate child support. I look at these with great skepticism. The parents have to convince me that the arrangement is genuinely in the best interest of the children. And, if there is a discrepancy in income, I require the parent with greater income to pay child support based on the difference. When parties learn that there is a way to get out of paying, they will exploit that loophole to gain an advantage in divorce negotiations that can have a negative effect on the children.

 

The Next Obergefell Shoe Falls

November 9, 2015 § 6 Comments

Before the US Supreme Court ruled in Obergefell v. Hodges on the constitutionality of same-sex-marriage bans and recognition of same-sex-marriages contracted in other states, Mississippi had its own same-sex-marriage case, Czekala-Chatham v. State of Mississippi, about which I posted previously. At the trial level, the chancellor had refused to recognize the parties’ marriage in another state, as required by the language of our state Constitution, and the appellant appealed, claiming that the Mississippi provision was contrary to the US Constitution. The State of Mississippi countered, taking the position that the ban was constitutional. As you may recall, the MSSC put that case on hold after the SCOTUS granted cert in Obergefell.

Then Obergefell came down in June, 2015, ruling unconstitutional state bans on issuance of marriage licenses to same-sex couples and requiring states to recognize the lawful marriages of same-sex couples in other states. Mississippi then confessed the appellant’s position in Czekala-Chatham, and the appellant then moved to dismiss the complaint and render judgment in favor of the appellant. The case has sat on the MSSC docket since then. In the four months since SCOTUS ruled, our court had been silent on its same-gender case.

On November 5, 2015, in Czekala-Chatham v. State of Mississippi, the MSSC did finally rule on the case, but only via an order that says, in essence, that, since the state had agreed that the case should bee reversed and remanded for further proceedings, “We find that no contested issues remain for resolution, and that the [appellant’s] motion should be granted. End of case for now.

The order, signed by Justice Randolph, was joined by Lamar, Chandler, and Pierce. Pierce agreed, with a separate opinion joined by Chandler. Justices Dickinson, King, and Coleman objected to the order.

All writing separate opinions would have preferred to render an opinion in the case to discuss its merits. Justice Coleman offered his objecting opinion as what he would have written to find Mississippi’s laws on the subject unconstitutional.

From the majority’s viewpoint, I suppose, the order narrowly rests on the vehicle that was presented to the court: i.e., the appellant’s motion to dismiss, and the majority did not want to venture out into areas not encompassed in the motion.

To the objectors, however, the court missed an opportunity to settle this area of law in our state so that litigants, lawyers, and judges would have a clear beacon by which to navigate.

All of the ramifications of Obergefell will become clear over time, but it will take more appeals than Czekala-Chatham to get there, it appears.

Relief in a Vacuum

October 19, 2015 § Leave a comment

If the separate maintenance is denied, may the chancellor nonetheless order financial relief?

In Spotswood v. Spotswood, decided by the COA on September 1, 2015, the chancellor at trial ruled that Lori and Robert Spotswood were equally at fault in  the separation, and, therefore, that Lori was not entitled to separate maintenance. The chancellor ordered Robert to reimburse Lori for the monthly health insurance premium that she pays through her employment for his health insurance coverage, and to pay one-half of the mortgage on the marital residence.

On the face of it, the judge’s order makes some sense. Robert, after all, is benefitting from Lori maintaining his coverage under her health insurance at her expense. She may not be able to cancel that coverage while they are still married. Likewise, Robert is no longer living in the home, and Lori is stuck with 100% of a joint debt. It only seems fair that Robert should pay his fair share.

Robert appealed, though, complaining that the judge had no authority after he denied separate maintenance to order in this action that he make those payments. Judge Irving, writing for the court, agreed, reversing and rendering:

¶7. In Pool v. Pool, 989 So. 2d 920, 927 (¶¶20-21) (Miss. Ct. App. 2008) (internal citations and quotation marks omitted), this Court stated:

Separate maintenance is [a] court[-]created equitable relief based upon the marital relationship. The purpose of a decree for separate maintenance is to compel the husband to resume cohabitation with his wife or to provide for her separate maintenance. . . . The [chancery court] may award separate maintenance when (1) the parties have separated without [substantial] fault by the [requesting party;] and (2) the [nonrequesting party] has willfully abandoned the [requesting party] and [has] refused to [provide] support [therefor].

(Emphasis added).

¶8. For a chancery court to award separate maintenance, it must first find that the aforementioned requirements have been met. Once those requirements are met, then the court may, in its discretion, award support. However, if the court finds that separate maintenance is unwarranted, it cannot, in the name of equity, do an end-run around what the law forbids by ordering one spouse to undertake certain financial obligations for the benefit of the other spouse. In this case, because the chancery court found that Lori was not entitled to separate maintenance, the chancery court lacked the authority to order Robert to make the payments.

So, does this mean that Lori is stuck making Roberts’ health insurance premium payments and the entire mortgage payment? Not necessarily. The opinion continues:

¶9. To be clear, we do not address the issue of whether the chancery court erred in denying Lori separate maintenance, as that issue is not before this Court. Nor should anything in this opinion be interpreted as holding that Lori is required to continue to pay Robert’s insurance premiums or the entire mortgage payment without reimbursement from Robert. As to the latter, the mortgage contract dictates the obligations of the parties. We only hold that the chancery court erred as a matter of law in ordering Robert to make the payments after denying Lori’s request for separate maintenance. Accordingly, we reverse the chancery court’s judgment as to the payments and render judgment in favor of Robert.

In other words, Lori may maintain an action to recover from Robert, but not in this case, since all she sought was separate maintenance, which was denied. I think she might have achieved a different result had she pled in the alternative for either separate maintenance or for contribution from Robert for his share of the premiums and/or mortgage payments. You can join as many actions as you have against a party in the same complaint.

Essential Jurisdictional Facts for Divorce

September 9, 2015 § 7 Comments

There are four fundamental facts you need to know about divorce in Mississippi:

  1. Venue is jurisdictional.
  2. Residence is jurisdictional.
  3. There must have been a marriage for there to be a divorce.
  4. Pleadings are not evidence.

Knowing those four things, then, you need to make sure that you put proof in the record, most usually in the form of testimony, that establishes venue and residence — ergo jurisdiction  — and that there was a marriage.

Here are the jurisdictional facts that need to be in the record for the court to exercise jurisdiction over a divorce:

  • That there was a valid marriage. When and where were the parties married?
  • When was the separation? Separation is not essential for the granting of a divorce, per MCA 93-5-4, but it helps the judge understand the context of the divorce. Many chancellors will want you to establish that, despite the non-separation, they have not had consensual sexual intercourse.
  • Where is venue? For a fault-based divorce, the case must be filed in: (1) the county where the defendant resides; or (2) the county where the plaintiff resides if the parties lived in that county up to the time of the separation and the plaintiff has continued to live there; or (3) the county where the plaintiff resides if the defendant is a non-resident or not to be found in the state. If the ground for divorce is solely irreconcilable differences, the complaint may be filed in the county of either party. MCA 93-5-11. If the action is not filed in the proper county, the court has no jurisdiction, and the case must be transferred to the proper county, per MCA 93-5-11 and MRCP 82(d).
  • Is there the requisite residential period? One of the parties must have been a bona fide resident of the State of Mississippi “within this state” for six months “next preceding” the commencement of the case. That means that there must be six uninterrupted months of actual residence inside the state. It is not enough to move here four months before filing and claim that you actually changed your residence to Mississippi two months before moving here, or to stitch together several periods of residency to make six months. The six-month period does not apply to U.S. military actually stationed in Mississippi, provided that the member resided with the spouse in Mississippi, and the separation occurred in Mississippi. Residency must not have been acquired to secure a divorce. MCA 93-5-5.

Don’t forget the UCCJEA allegations if custody is an issue.

Just because you plead all of the jurisdictional requirements, that does not prove anything because pleadings are not evidence, and the only way to prove something is to get evidence into the record — meaning the trial transcript.

I find that even experienced lawyers fail to get this vital proof into the record in some cases. It happens primarily in cases where the plaintiff’s attorney calls the other party adversely as the first witness. Those jurisdictional fact questions somehow never get asked. Maybe the attorney is afraid that the adverse party will deny residency or something similar. Maybe the attorney is more preoccupied with confronting the cheater with videos, or making him admit he squandered the family fortune gambling. Maybe it’s simple oversight. Whatever, it should not be left up to the judge to inquire about these jurisdictional nuances.

Equity Delayed is Equity Denied

August 26, 2015 § 2 Comments

If your trial judge in a bench trial takes a case under advisement and fails to render a decision within a reasonable time, MRAP 15 provides the remedy:

(a) When a trial judge in a civil case takes under advisement a motion or request for relief which would be dispositive of any substantive issues and has held such motion or request under advisement for sixty (60) days, the plaintiffs and the defendants shall each within fourteen (14) days thereafter submit a proposed order or judgment to the trial judge and shall forward to the Administrative Office of Courts, the trial court clerk and the opposing parties true copies thereof with a statement setting forth the style and number of the case, the names and addresses of the judge and of all parties and the date on which such motion or request was taken under advisement. On receipt of such proposed orders and notices, the Administrative Office of Courts shall calendar them and notify the trial judge and the trial court clerk of the filing. At any time thereafter that an order or judgment is entered on the motion or request for relief, the plaintiffs and the defendants shall, in writing, promptly notify the Administrative Office of Courts and the opposing parties of the date of entry of the decision; copies of such notification shall be sent to the judge and the trial court clerk. If no written notice of a decision is received by the Administrative Office of Courts within six(6) months from the date the case was taken under advisement, the Administrative Office of Courts shall confirm with the trial court clerk that no order or judgment has been entered and notify the Supreme Court. The Administrative Office of Courts will forward copies of its notification to the trial judge and parties and shall advise the judge and counsel that they are to respond to the notice within a specified period. The Supreme Court shall treat such notification as the filing of an application for a writ of mandamus by all the parties to the action and shall proceed accordingly. The notice of the Administrative Office of Courts of the time within which to respond shall satisfy the requirements of M.R.A.P. 21(d).

(b) The trial judge, not later than thirty (30) days prior to the expiration of the six (6) months from the date the case was taken under advisement, for just cause shown, may apply in writing to the Supreme Court for additional time beyond said six (6) months in which to enter a decision. Concurrently, the judge shall provide a copy of such application to each of the parties.

No one wants to tick off a chancellor who holds the fate of the client in his or her hands, but sometimes you just gotta do what you gotta do.

I mention this with the COA’s decision in Chipley v. Chipley, decided August 11, 2015, in mind. In that case, the Special Chancellor granted a divorce between Wanda and Kenneth Chipley on January 25, 2011, and directed the attorneys to provide, in effect, proposed findings of fact and conclusions of law on Ferguson factors within ten days. Thereafter, the case sat dead in the water for two years, until the MSSC ordered the chancellor to adjudicate the property division, which he did on February 15, 2013. After some post-trial-motion maneuvering that ate up the remainder of the year, Wanda filed an appeal on December 17, 2013, which the COA determined to be timely.

In its August 11, 2015, opinion (that’s four years and nearly eight months after the divorce), the case was reversed and remanded because the Special Chancellor failed to include a Ferguson analysis in his final ruling. It’s axiomatic that the judge’s decision must be supported by findings of fact and conclusions of law on Ferguson. Dickerson v. Dickerson, 34 So.3d 637, 644 (¶24) (Miss. App. 2010). It’s not enough merely to mention the factors. Lee v. Lee, 78 So.3d 326, 329 (¶10) (Miss. 2012). No analysis = reversal and remand. Reed v. Reed, 141 So.3d 450, 455 (¶18) (Miss. App. 2014).

Still to be dealt with are a motion for rehearing and possible cert petition before a mandate is issued, chewing up some more time in the Chipleys’ lives. After all that, they will return to where they started, still without a determination of their property interests. It will take some time to appoint a replacement Special Chancellor, since the original one has died, and the remand hearing will need to be scheduled to accommodate the lawyers, judge, and the parties, which likely will mean more delay and a trial either in the first quarter of 2016, if no further appellate proceedings are had, or much later if the case tarries in the higher courts. I wonder whether those assets that they are fighting over will still even exist after all that time.

Demarcation Date on Remand

August 24, 2015 § Leave a comment

The date on which the marital assets are assigned a value can make a drastic difference in the ultimate outcome of the equitable distribution. It’s a concept that we’ve touched on here before. In Lowery v. Lowery, 25 So.3d 274, 285-286 (Miss. 2009), the court said:

¶ 27. For purposes of determination of equitable division … the date for determination would be either the date of separation (at the earliest) or the date of divorce (at the latest). “Cases appear to hold that, as a matter of law, property acquired during separation is marital unless a support order has been entered…. However, a few cases suggest that the issue is a question of fact for the chancellor to decide….” Bell on Mississippi Family Law at § 6.02[3][b] n. 58 (citing Stone v. Stone, 824 So.2d 645, 647–48 (Miss.Ct.App.2002); Aron v. Aron, 832 So.2d 1257, 1258–59 (Miss.Ct.App.2002)).

Other cases have suggested that the valuation date can vary according to the assets. In other words, one asset could have one valuation date, and another a different valuation date.

So, is the rule any different when the case is remanded to the trial court for a do-over? Things can change in the lengthy time it takes to complete the appeal process, after all.

That’s what happened in Lewis v. Pagel, handed down by the MSSC on August 13, 2015. Following a trip through the COA, and from there to the MSSC, Drake Lewis and Tonia Pagel (formerly Lewis), found themselves back before the chancellor for a do-over on equitable distribution. The case was remanded for the chancellor to treat certain real properties as non-marital, to re-value a business, and to re-analyze equitable distribution. The chancellor followed the appellate courts’ instructions, using the asset values as of the date of the divorce.

Drake appealed, complaining that the chancellor’s approach skewed the ultimate outcome because values had changed in the time it took to complete the appeal cycle. Justice Chandler addressed his argument this way:

¶27. It is well-established that “an equitable division of property does not necessarily mean an equal division of property.” Chamblee v. Chamblee, 637 So. 2d 850, 863-64 (Miss. 1994). “[F]airness is the prevailing guideline in marital division.” Lowery v. Lowery, 25 So. 3d 274, 285 (Miss. 2009) (quoting Ferguson, 639 So. 2d at 929). Here, the chancellor’s division of the property was approximately equal. Drake’s argument that he received substantially less than Tonia relies on circumstances that occurred after the divorce judgment. However, the date for determination of equitable distribution is, at the earliest, the date of separation, or, at the latest, the date of divorce. Lowery, 25 So. 3d at 285. Additionally, an order of equitable division is a nonmodifiable judgment. East v. East, 493 So. 2d 927, 931 (Miss. 1986). Therefore, when the Court of Appeals remanded for the chancellor to revisit the equitable distribution, the chancellor properly redetermined the equitable distribution as of the divorce.

When you read the entire Lewis opinion (as I am sure you will), note that the chancellor did consider a post-appeal change in value that favored Drake. Legacy Holdings, LLC, a family business, was valued at the time of the divorce at $1,148,270, but the chancellor found that it had no value at the time of the remand hearing.

Here is a post about a case in which the chancellor’s use of the divorce trial date on remand was affirmed.

It would be a nifty skill for a lawyer to be able to tell the future. None of us in real life, however, has a crystal ball. Still, it’s a good idea to impress on your client that a side effect of an appeal could be that you can win the battle and lose the war. By the time the case descends from the lofty, rarified atmosphere of the appellate courts to ground level, things may have changed drastically in the meantime, resulting in a bounce that does not favor your client. In Lewis, the appeal on the equitable distribution saved Drake some rehabilitative alimony, but cost him $100,000 in lump-sum alimony. That’s going to leave a mark.

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