Month: July 2018

Divorce Surprises

Posted by Ron Kauffman on

According to a recent survey, 46% of divorced women reported their divorce brought unexpected financial problems. What are some of the divorce surprises you can run into if you find yourself in family court?

Divorce Surpises

In the study, 1,785 adult women were surveyed across three stages: those with divorce “on the horizon,” those in the midst of divorce, and those who described themselves as “divorced and determined.”

Divorce Tricks

Slightly related, I recently wrote about dirty divorce tricks which were in the news. These tricks should serve as a warning, not as a “how-to course”, because they can seriously backfire. A couple of common tricks to watch out for include:

  • Refusing to pay household bills until a court forces you to in an attempt to “Starve Out the Other Spouse”.
  • Waiting until the latest possible day to pay support money, even if you’ve got the money to send. Never mind the children.
  • Asking the court for sole custody of the children when you only want to share custody.

These tricks are not the kind of divorce surprises reported in the survey though. The above tricks are the result of planning to harm the other side.

Divorce Surprises

The surprises from the survey are very different. The divorce surprises have nothing to do with fraud, or the other side failing to disclose assets. So what are they?

  • Not knowing the size of your debt, including the first mortgage, home equity line of credit, the credit card debt, 501(k) loans, and student loans.
  • Not anticipating you may have to return to the workforce
  • Assuming your child support and/or alimony would be higher or last longer
  • Assuming you could keep the marital home
  • The staggering cost of health care insurance
  • Underestimating the emotional and financial cost of getting a divorce

In general, the study found that many women find themselves in a financially vulnerable position post-divorce due to a lack of financial knowledge and planning. The study claims a solution is twofold:

  • Reinvent careers to become self-sufficient and
  • Invest to avoid outliving your money.

The Forbes article is here.

 

Adultery and a Stormy Divorce

Posted by Ron Kauffman on

Divorces can be stormy affairs. Add in a cheating spouse, and the skies can open up. The husband of adult film star, and recent political media sensation, Stormy Daniels, just filed for divorce in Texas. The reason may shock you: adultery!

Adultery Divorce

Storming Out

Stormy Daniels, whose real name is Stephanie Clifford, has become a media sensation of late, after she claimed she had sex with Donald Trump before he became president, something Trump has denied.

Glendon Crain filed the petition for divorce on July 18 in state district court in Kaufman County, located just southeast of Dallas.

In his 13-page divorce petition, Crain alleged adultery as grounds for the divorce and seeks sole custody of the couple’s daughter, child support from Clifford, a financial award, and disproportionate share of the couple’s property.

Cheating and Divorce

I’ve written about divorce and cheating before. Adultery can be the cause of a divorce, but can it impact the outcome? Since Florida became a no-fault state, the fact that, Stormy had a fling with Trump would not be a thunderbolt in court.

While anyone can file for divorce without proving grounds, there is still a statutory basis for infidelity to be an issue in your divorce proceedings, but not in the way most people think. Here’s a quick review of why adultery can potentially creep into your divorce:

Equitable Distribution

Adultery may impact the division of property. Florida is an equitable distribution state, and it is presumed that property should be evenly divided.

This presumption may be overcome by proof that one spouse intentionally wasted marital assets.

This waste is sometimes known as dissipation. Paying for expensive jewelry, foreign trips, rent, car payments, and dinners for girlfriends and boyfriends is considered wasting marital assets. The court has the power to reduce an adulterer’s equitable distribution to credit the marital estate for waste.

Alimony

Florida law specifically provides that a court may consider the adultery of either spouse in determining the amount of alimony, if any, to be awarded. However, courts have struggled to reconcile the “fault” of adultery with the concept of “no fault” divorce. The result is a mix of weak opinions.

Parenting Plans/Custody

Chapter 61 discusses the “the moral fitness of the parents” as one of the factors the court considers in determining the best interests of a child.

So, if one parent can prove that the other parent’s adultery had, or is reasonably likely to have, an adverse impact on the child, the judge can consider adultery in evaluating what’s in the best interest of the child. However, it would be extreme if a custody issue was decided on those grounds.

Weathering the Storm

Daniels’ lawyer Michael Avenatti said the “accuracy” of the divorce petition is “vehemently disputed.” Crain and Daniels married in 2015 and were living together until about two weeks ago, according to the petition.

After Daniels alleged she had sex with Trump in 2006, prosecutors have been examining a $130,000 payment that was made to Daniels as part of a confidentiality agreement days before the 2016 presidential election.

The NBC news article is here.

 

World Emoji Day ????

Posted by Ron Kauffman on

Incredibly, I overlooked World Emoji Day. Although late, in honor of yesterday’s World Emoji Day, it’s worth pointing out that my new article on emojis and legal ambiguity in agreements, which was recently published in the Florida Bar Family Law Section Commentator, will make anyone ????.

Ambiguous Divorce Agreements

Emojis

I’ve written about emojis before. Originating in Japan in 1998, emojis are small digital images used to express an idea or an emotion in electronic communications.

Today, roughly 70 percent of the public uses some type of social media.  Social media has changed many of the ways in which we communicate. For one thing, social media has increased our use of emojis.

One report found more than 92 percent of people use emojis on social media. Emojis have spread to the business world, where nearly half of workers add emojis to professional communications, and companies use them to increase sales and brand awareness.

Emojis in Court ????‍⚖️

Emojis are increasingly turning up in court, especially in agreements, and ignoring them would be like calling a witness to the stand and ignoring their facial expressions.

Emojis fail the ‘duck test’: if it looks like a duck, and quacks like a duck, then it is probably a duck. That’s because emoji meanings can be so puzzling, a “duck” emoji, may mean anything but a duck.

For example, a U.S. federal court recently held that a “Smiley” emoticon =) converted an email into a joke, the email meant the opposite of what it said, and a criminal defendant’s lawyer did not violate the Sixth Amendment by sending the prosecutor an email joking: “stipulate that my client is guilty. :)”

An Israeli court awarded damages based on emojis after a prospective tenant sent a landlord a text about a lease agreement saying: “Good morning ???? we want the house???????? ????‍ ✌ ☄ ???? ???? just need to go over the details. . .” The landlord removed his ad, then the tenant disappeared. The court awarded the landlord 8,000 shekels.

Ambiguity: What does ???? Mean?

There are unique issues with emojis, rendering them hard to interpret. For one thing, there’s no definitive source as to what emojis mean.

That unknown can make agreements in an email, a text or an actual marital contract, ambiguous. Marital agreements are interpreted like any other contract. Basic interpretation begins with the plain language of the contract, because the contract language is the best evidence of intent.

Courts are not supposed to rewrite terms of an agreement if they are clear and unambiguous. Anyone seeking to show a court any evidence outside a fully integrated contract, must first establish that a contract is ambiguous.

A contract is ambiguous when its language is reasonably susceptible to more than one interpretation. That’s where emojis come in, they can be very ambiguous. Emojis are also small, making them hard to read. Interpreting an emoji can depend on what kind of device they appear in. For example, a 24-inch computer monitor displays thing differently than a 4-inch phone screen.

Emojis don’t always mean the same thing universally, so there can be many different meanings depending on which country you are in. For example:

????

The “Folded Hands” emoji symbolize “please” and “thank you” in Asia. However, in the U.S. it means: “I’m praying,” and frequently, “high-five”!

????

The “Pile of Poo” emoji is a pun on the Japanese word for excrement (unko), which starts with the same “oon” sound as the word for “luck” and is complimentary in Japan. But, in the U.S. the emoji is used to express contempt. Strangely, Canadians use the emoji the most.

Information on World Emoji Day is available here.

 

International Divorce and Custody

Posted by Ron Kauffman on

According to the U.S. Census Bureau, international marriages are on the rise. And that means an increase in relationships crossing borders. This has also created a glut of international divorce and custody disputes.

international divorce and custody

If you think that a parent or your partner could take your child out of the state or country, there are a few treaties, laws and statues you should be aware of to help you resolve an international divorce and custody battle in your favor.

International Cases

The Hague Convention on the Civil Aspects of International Child Abduction, also known as the Hague Convention, is an international treaty to help promptly return children wrongfully abducted.

The Hague Convention only applies between countries that have signed the Convention, and its reach is limited to children ages 16 and under.

The Convention’s central operating feature is the return remedy. When a child under the age of 16 has been wrongfully retained, the country to which the child has been brought must order the return of the child unless certain exceptions apply.

The Hague Convention also deters abductions. It does that by eliminating the primary motivation for abducting. Since the goal of the taking parent is to get rights of custody from another country, when a child is wrongfully removed, the other country must order the return of the child forthwith.

Foreign Courts

I’ve written on international divorce and custody before, especially as they relate to child custody issues and The Hague Convention on abduction.

In addition to the Hague Convention, you’ll need to know if there are cultural or religious beliefs that could impact your case. For example, some countries have a preference for granting sole physical custody mothers, and others to fathers.

Interstate Cases

International custody disputes are difficult to navigate, but so are interstate divorce and custody cases: meaning cases between parents living in two different U.S. states.

Generally, when two parents reside in Florida, Florida custody laws will apply. However, when one of the parents and the child move across state lines, you have an interstate custody problem.

To help with conflicts between different laws in different American states, the Uniform Law Commission is tasked with drafting laws on various subjects that attempt to bring uniformity across American state lines.

With respect to family law, different American states had adopted different approaches to issues related to interstate custody, visitation, and time-sharing. The results were that different states had conflicting resolutions to the same problems.

To seek harmony in this area, the Uniform Law Commission promulgated the Uniform Child Custody Jurisdiction and Enforcement Act (the UCCJEA), which Florida and almost all U.S. states passed into law.

The most fundamental aspect of the UCCJEA is the approach to the jurisdiction needed to start a case. In part, the UCCJEA requires a court have some jurisdiction vis-a-vis the child. That jurisdiction is based on where the child is, and the significant connections the child has with the forum state, let’s say Florida for this example. The ultimate determining factor in a Florida case then, is what is the “home state” of the child.

The Census fact sheet on international marriage is here.

 

Divorce to Save Money?

Posted by Ron Kauffman on

The Hill reports that a Texas couple may divorce to save money in order to pay for their daughter’s rising health-care costs. There are times when people have divorced “on paper” to save money, but is this a good reason and does it work?

Divorce save money

Health Care Scare

Can you divorce to save money? Jake and Maria Grey may try. They told NBC’s “Today” that Brighton, the older of their two daughters, has Wolf-Hirschhorn syndrome, a developmental disability that requires 24/7 care.

“We shouldn’t have to make that sacrifice to get our child Medicaid!”

They said they spend thousands of dollars annually out of pocket, even though Jake Grey has private health insurance. The couple added that they are considering divorcing to save money so that Maria Grey can qualify for Medicaid as a single, unemployed mother.

Divorce to Avoid Penalties

I’ve actually written about a similar issue, namely: divorcing to save money on taxes by avoiding the marriage penalty tax. Back when the 2012 American Taxpayer Relief Act was passed, it raised taxes on couples making more than $450,000, and individuals making more than $400,000. As it turns out, some couples found out they could save over $25,000 a year if they divorced.

Think about that for a second. If you could save over $25,000 a year in taxes, you could take a couple’s trip to Italy, ski Deer Valley, put a little cash away for college, and still have some mad money to spend just by divorcing and turning your marriage into a long-term relationship.

Divorcing on Paper

There are a lot of risks though, known and unknown to divorcing on paper but staying together. I would encourage anyone considering a “divorce on paper” to think about a few things:

  • The impact on your relationship. I don’t know of a good way to ask for a divorce: “Honey, I want a divorce. No, no wait, come back, it’s to save big bucks . . . really!”
  • There is no fake divorce. Once the court signs the final judgment of divorce, you are divorced. Once you’re divorced, your Ex may find someone who thinks marriage is more valuable than 5% adjusted gross income.
  • IRS rules regarding your filing status have something to say. IRS publication 504 warns that if you obtain a divorce just to file as unmarried with the intent to remarry the next tax year, you have to file as married individuals.
  • State law. All no-fault states have minimum requirements for getting a divorce. Florida, for instance, requires at a minimum that your marriage be irretrievably broken before you can get a divorce.
  • In addition, there are estate planning issues, retirement and social security complications, and many other issues besides the mere tax savings.

Most people who marry do so forever, and with the sincere intention of honoring their vows. Is the money worth it?

Jake Grey’s $40,000 salary is too much for the family to receive Medicaid, and Maria Grey said they are No. 60,000 on the list to receive state assistance.

It’s drowning us to try to keep up with her medical expenses. We’ve done everything we can do to try to keep her afloat, and we’re going to reach a point where we can’t do it and we won’t have another option. We don’t know what to do.

The Hill article is here.

 

The Alimony Race

Posted by Ron Kauffman on

Yet another news outlet is reporting on the 2018 Alimony Race. NPR weighs in on why people are rushing to finalize divorces this year: so they can deduct alimony payments before the new tax law kicks in.

alimony race

On Your Mark

As NPR reports, divorce lawyers and accountants have been advising many of their wealthier clients to hurry up and get divorced, like, now or at least before the end of the year because under the new tax law starting in 2019, a generous tax break for alimony payments will be gone.

The New York Times’, Jim Tankersley, who covers tax and economics stories, had a few things to say:

TANKERSLEY: So right now, if you get divorced – let’s say you’re a husband who is paying alimony to your ex-wife. You can deduct that, if you so agree with your spouse in the divorce settlement, from your taxes. But what’s going to happen is you won’t be able to anymore.

…

CHANG: OK, so spouses who will be on the hook for alimony payments will be eager to get their divorce settlements finalized this year but also, I can imagine, spouses who will be receiving the alimony payments because I would think that my soon-to-be ex would have more of a reason to give me more alimony if he or she gets a bigger deduction out of it this year.

TANKERSLEY: Yes, but it affects different couples differently. For couples who make essentially the same amount of money, if they’re in the same tax bracket, this is just an accounting shift. The same total amount of money changes hands.

…

TANKERSLEY: But for couples who make different amounts of money and are in different tax brackets, what they basically got before was a subsidy from the government for their divorce…

CHANG: What do you mean?

TANKERSLEY: …Because the higher-earning spouse was able to pass on income that would have been taxed at a really high rate but then instead was getting taxed at a low rate.

…

TANKERSLEY: So that difference between the tax rates was just free money from the government. Now that goes away. So, if you’re the husband, for example, who earned more and is paying that alimony to a wife, now you have to pay the taxes at the higher rate. That free money disappears, and so you are probably going to say to your ex-wife, sorry, there’s no more money; I’m not going to give you even more than I was originally thinking I was going to have to pay. And so, you the ex-wife end up with less money overall. And in between, the government gets more money.

CHANG: And I can imagine most couples that have severely disparate incomes – it’s usually the woman who earns less. So, this tax law change will probably have women bearing most of the cost.

TANKERSLEY: That’s what divorce lawyers and tax professionals and financial planners have been telling me – is that, yeah, it’s largely women who receive alimony. And particularly with wealthy couples, it’s largely women who leave the labor force to take care of kids or for whatever reason. And women earn less in the economy for the same work than men do. This is a potentially big loss for women…

Why it Matters

Spouses negotiating alimony payments may try to pay less when the change takes effect because there will be no tax savings.

The deduction is a big deal to couples negotiating their divorce because if someone who earns, say, $250,000 agrees to pay $4,000 per month in alimony, it really costs the person about $3,000 after taking the deduction into account.

Without the break, many people will agree to pay only what would have been their after-tax amount. It is feared that more couples will end up fighting in court because they won’t be able to agree on alimony.

2019 Deadline

The alimony deduction repeal doesn’t take effect immediately and won’t kick in until 2019. That is why lawyers are advising clients to file for divorce now.

However, meeting the 2019 deadline won’t be easy.

Some states have mandatory “cooling-off” periods, others states have residency requirements. So, you can’t just file for a divorce today, and expect that you’re going to be divorced tomorrow.

The NPR interview is here.

 

My Big Fat Gray Divorce

Posted by Ron Kauffman on

Nia Vardalos has filed for divorce from husband Ian Gomez. Her 1993 nuptials inspired the hit movie “My Big Fat Greek Wedding,” and the marriage lasted for nearly 25 years. Nia’s is another example of the recent phenomenon of “gray divorce.”

Not Zorba the Greek

As PEOPLE magazine reports, after the couple’s 1993 wedding, Vardolos wrote the one-woman play “My Big Fat Greek Wedding,” partially based on her own experiences. She starred in the 2002 hit movie playing Toula Portokalos, who falls in love with non-Greek Ian Miller. Gomez played Corbett’s best man, Mike.

The actress, 55, filed on Tuesday in Los Angeles County, citing irreconcilable differences as the reason for their split, according to court documents obtained by The Blast.

Vardalos said she separated from her husband over a year ago on June 29, 2017, almost 24 years after they said, “I Do.”

Florida Gray Divorce

I’ve written about gray divorces before. The legal nuances of gray divorce can be different than what other couples might encounter. In a gray divorce, the financial considerations take on more importance than the children’s issues – because the children are emancipated or nearly so.

When couples choose to divorce in their 30s or 40s, they still have time to recover financially, because adults at that age have several years, if not decades, left in their careers.

But when divorce occurs when a couple is in their 50s or later, the so-called “gray divorce”, careers may either be coming to a close or are completed, and spouses are often living on fixed incomes provided through Social Security or retirement benefits.

Here are some things to consider:

  • By the time a couple enters the golden years, there may be gold to divide, including businesses, retirement funds, and vacation homes. Valuing these assets can be difficult. A financial advisor may be an important component in the divorce.
  • Health insurance is often tied to the employment of a spouse. Courts may need to intervene if one party has dwindling capacity to handle their own affairs.
  • Wills and trusts need to be reviewed to make sure they reflect post-divorce wishes. The same is true for long-term care, such as medical directives, living wills and trusts.
  • Retirement plans can be substantial and complex. Retirement plans vary, and they all have different restrictions, tax consequences, distribution and vesting rules.

There are special concerns involved in a gray divorce. As always, information is power, so make a point to seek out experts for guidance.

Most gray divorces involve marriages that have lasted for several decades, which makes it difficult to disentangle the spouses from each other. However, couples who divorce after many years together should receive a close-to-even split of assets, legally putting each spouse on an equal playing field for the future.

A Woman’s Way

In a joint statement obtained by PEOPLE, the couple said:

“We’ve been respectfully separated for a lengthy period of time. Our relationship became a friendship so the decision to end the marriage is completely mutual and amicable. It is our hope that decency will prevail on the reporting of this story which will soon be yesterday’s news. Thank you for respecting our privacy.”

Unlike many gray divorces, the couple share an 11-year-old daughter whom they adopted in 2008. She is asking for joint legal and physical custody of their daughter. The actress also asked that spousal support to be “determined in mediation.”

She and Gomez received the news that they had been matched with their then 3-year-old daughter in 2008 after more than nine years of struggling to become parents.

The PEOPLE article is here.

 

Who’s Your Daddy? Florida’s New Paternity Law

Posted by Ron Kauffman on

If it is a wise child that knows its own father, the Florida Supreme Court just created a new paternity law last week to help children know their true fathers. The court settled whether a biological father is prohibited from establishing his parental rights to his child if the child was born to a married woman.

Not Your Father’s Paternity Law

Perkins is the biological father of his daughter. Perkins and the child’s mother, Simmonds, engaged in a three-year relationship. Unknown to Perkins, his girlfriend was already married to another man.

When Perkins – the biological father – wanted to assert his child custody rights over his daughter, Simmonds and her husband, Ferguson, objected. Ferguson – the legal father – asserted his status as the child’s legal father– by virtue of his marriage to Simmonds – to block Perkins’ rights over his daughter.

Some interesting facts about the case:

  • Perkins was at the hospital for the child’s birth. Ferguson was not.
  • Simmonds declined to have Ferguson’s name listed as on the birth certificate. Simmonds gave the child Perkins’s last name and raised the child with Perkins.
  • Perkins and Simmonds lived together with the child.
  • Perkins has taken the child to doctor’s visits and enrolled the child in day care. Perkins regularly and voluntarily paid child support to Simmonds for the child.
  • The child knows Perkins as “daddy.”

So what’s the problem?

The problem in this case is that after Perkins filed a petition to establish paternity Simmonds moved to dismiss it, saying Perkins can’t establish paternity because of the common law presumption of legitimacy. That presumption is one of the strongest in Florida law.

Florida Paternity Law

I’ve written about paternity issues before. Sadly, for Perkins, after an evidentiary hearing, the trial judge ruled that it was bound by precedent to dismiss his petition.

In Florida, a putative father had no right to seek to establish paternity of a child who was born into an intact marriage, when the married woman and her husband object.

Although the trial judge held an evidentiary hearing and found that the facts strongly indicate that allowing Perkins to have “some involvement in the child’s life” would be in the child’s best interests, the trial court ultimately concluded that it was constrained by Fourth District precedent to dismiss the petition as a matter of law.

The Father of All Custody Conflicts

There’s been a conflict among Florida courts over this issue. Florida law presumes that the husband of the biological mother of a child is the child’s legal father.

This presumption is one of the strongest rebuttable presumptions known to law and is based on the child’s interest in legitimacy and the public policy of protecting the welfare of the child.

In Florida, many courts have held that a biological father has no right to seek to establish paternity of a child who was born into an intact marriage when the married woman and her husband object.

Some courts in Florida have gone so far as to suggest that the presumption of legitimacy may never be rebutted. While others have held that the presumption of legitimacy may be rebutted in certain, rare circumstances.

Twinkle in One’s Father’s Eye: New Paternity Law

The Supreme Court resolved the conflict and determined that the presumption of legitimacy does not create an absolute bar to a biological father’s right to seek to establish his paternity when the biological father has “manifested a substantial and continuing concern” for the welfare of the child.

The presumption of legitimacy is overcome when there is a “clear and compelling reason based primarily on the child’s best interests.”

So, for Mr. Perkins, the presumption of legitimacy has been found to be rebuttable by a biological father. Evidence that the mother’s husband has abused, abandoned, or neglected the child – although relevant – is not required to establish that it would be in the child’s best interests to recognize the biological father as the legal father.

The Supreme Court opinion is available here.