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Chapter 2: legal aspects of divorce.

This chapter will provide an overview of some of the general issues affecting divorce. It is important to keep in mind that the laws about divorce are very different from state to state. You must familiarize yourself with the divorce laws and procedures in your own state. There are three ways to accomplish this.

First, divorce law is written in the form of statutes, sometimes called "dissolution of marriage" statutes. (And contrary to public opinion, these laws are written in English.) Most books containing statutes (Codes) will give you the law on a topic and then provide short paragraph bullet entries about the cases that have come down from courts interpreting that law. Reading the divorce statutes is a very good way to get the flavor of how the law is applied in your state.

For instance, the divorce statute may list factors that a judge may consider when dividing property in a divorce. The statute typically does not state that those same factors must be considered and weighted the same as when the spouses divide the property themselves. Rather, what the judge must consider is the fallback position if the spouses cannot agree. For example, a statute defines marital and separate property. The spouses may agree to define these terms the way the statute does, but they are free to define them in their own way (subject to the judge approving the settlement).

Second, we recommend you contact your state or local bar association. Lawyers take classes on the different aspects of family law. Most states have continuing legal education programs on divorce law concerning everything from the basics for beginning lawyers to advanced topics for long-time lawyers. If you pay the fee, you will probably be able to take the seminar or buy the tapes and materials.

Third, you may even want to go to the courtroom and watch a case, which can also increase your knowledge base.

ALTERNATIVES TO TRADITIONAL DIVORCE LITIGATION

Dissolution involves an agreement between two married persons to end the marriage. Before the spouses file any papers, they agree to such matters as property division, responsibility for debt payments, allocation of parental rights and responsibilities, and alimony and child support. In dissolution, spouses do not have to make allegations or prove any grounds for divorce. To obtain court approval of a dissolution the spouses must enter into a separation agreement, sign the agreement, and attach the agreement to the request to the court for dissolution. Next, the court determines whether the agreement is not only fair to both parties but also makes provisions for any children. The court then approves (or rejects) the separation agreement and dissolution request and issues an order dissolving the marriage. (1)

An annulment of a marriage is essentially a declaration by a court that a marriage was not valid from the beginning. Specific grounds for obtaining an annulment vary from state to state, but reasons typically include: at least one party being underage; the biological relationship of the parties is too close; bigamy; mental incompetence or incapacity of one party; fraud, and failure to consummate the marriage. (2) Similar to a divorce proceeding, in an annulment action a court can award temporary spousal support and make orders regarding child custody and support. (3)

Mediation is a structured step-by-step process that is confidential and speedy. There are separate meetings, then a joint session if appropriate, in which issues are clarified, options are created, and win/win solutions are sought. Mediation not only facilitates agreements, but also provides such benefits as: (1) information that can improve future relationships; (2) better communication if future problems should occur; (3) clarification about misunderstandings; and (4) less stress, more confidence. Mediation is discussed in more detail in Chapter 3.

A legal separation granted by a court means that a couple remains legally married, but most aspects of the marital relationship are terminated. The court settles all of the property rights between the couple, addresses custody issues, and may also resolve issues such as spousal and child support. In addition, the court may enforce a support payment as though it had been granted in a divorce proceeding. With certain minor exceptions, grounds for legal separation are essentially the same as for divorce. (4)

MATRIMONIAL LAW

Matrimonial law is a specialty with its own courts and judges. It is, however, a judicial procedure and thus follows the rules of evidence.

The names of the parties are different in a divorce lawsuit as opposed to a regular civil lawsuit. In most states, the defendant in a divorce lawsuit is known as the respondent and the plaintiff is known as the petitioner. Most of the other procedures and nomenclature are basically the same.

Once the petitioner files a complaint, the action is commenced. The complaint lists the grounds for asking for the divorce as well as the claims being made against the respondent.

WHAT IS MEANT BY "DOMICILE"?

An individual can have only one domicile even if that person has more than one home. Your client's domicile is a permanent legal home that he/she intends to use for an indefinite or unlimited period, and to which, when absent, intends to return.

The question of where a person's domicile is located is mainly a matter of intention as indicated by his/her actions. A person must be able to show with facts that he/she intended a given place or state to be his/her permanent home. Some factors used in determining domicile are:

* Where state income tax is paid.

* Where the person votes.

* Where property owned is located.

* Citizenship.

* Length of residence.

* Business and social ties to the community.

* Amount of time spent in each location.

However, the amount of time spent in one place does not always explain the difference between home and domicile. A temporary home or residence may continue for months or years while a domicile may be established the first moment the property is occupied. An individual's intent is the determining factor in proving where he/she wants to be domiciled.

TIME RESTRAINTS

In all states, one spouse needs to have been a resident for a certain period of time for the court to have jurisdiction to divorce the couple. The typical length of time is 90 days.

The other time period that states have is the "cooling off period," intended to prevent people from rushing through the divorce. In many states the period of time from the beginning to the end of the case is typically 90 days. Even though that period is relatively short, the average divorce case takes about a year. About 95% of divorce cases reach a settlement. If no settlement is reached, the parties go to court and the judge makes the final decision.

GROUNDS FOR DIVORCE

In almost all states in this country, divorce is "no fault." That means that either spouse can get a divorce for whatever reason--and even if the other spouse doesn't want the divorce. It does not need to be proven that the other spouse was a bad person in order to get a no-fault divorce. The language is typically that the marriage is "irretrievably broken" with no chance for reconciliation.

In some states, "fault" could play a role in the division of property, award of custody, award of alimony, or child support. It's an intimidating factor in settling a case if one spouse has to testify regarding his or her bad acts.

PRE-TRIAL

Prior to a trial, the attorneys begin with depositions, which are the testimony of the parties. Depositions are not taken in the courtroom; instead they are usually taken in the offices of the attorneys. These proceedings are attended by the parties and the attorneys for both sides. Also attending is a court reporter who takes down all the questions and testimony given by the party or parties deposed.

Instead of going the more expensive and formal route of a deposition, interrogatories can be used instead. These are written questions submitted to the parties that seek to obtain information pertaining to the case at bar.

Either party may make motions to the court. They may be either written or oral and they seek to ask the court to order something or to deny some issue relating to the case. In these areas the judge will hear the motion and make a decision as to whether the motion will be accepted or denied.

Once a trial begins it will be the same as any other trial. The petitioner will make an opening statement to be followed by the respondent. Then direct examination takes place followed by cross-examination by both sides.

What is Discovery?

Discovery is the process of gathering information about the nature, scope, and credibility of the opposing party's claim. Discovery procedures include depositions, written interrogatories, and notices to produce various documents relating to issues that are decided in the case. Many cases are won or lost at the discovery stage.

The theory behind discovery is that justice is best served if both sides have access to the same facts and evidence. But with a spouse who is knowledgeable about financial affairs and willing and able to manipulate records, discovery can turn into a struggle for the other spouse.

If your client's spouse works for someone else, be thankful because tracking down accounts and investments will be easy compared to the situation if that spouse is either a self-employed professional or someone who runs his or her own business. Manipulation of financial data is relatively easy for self-employed people (e.g., doctors, dentists, lawyers, accountants, financial consultants, stockbrokers, real estate agents, store or factory owners, independent contractors, or someone who runs a cash business).

The law gives your client's lawyer wide discretion not only to review tax returns, business and personal records, contracts, canceled checks, credit card receipts, and other documents, but also to question your client's spouse, his or her friends, relatives, and business associates about that spouse's financial dealings.

Formal Discovery

There are two types of discovery: informal and formal. Formal discovery includes legal procedures such as depositions, interrogatories, and requests for production of documents.

Depositions. A deposition is the sworn testimony of a witness taken outside the court in the presence of lawyers for each side. There is also a court reporter present to record the proceedings and testimony has to be given under oath. Because it is a sworn statement, it becomes part of the record of the case. If a client say one thing in the discovery deposition and something else at the trial, your client will have to explain why his/ her answer changed. The parts of the discovery deposition that are in conflict can be read to the witness at trial, and if the change is substantial and unexplained, the overall testimony of the witness will be less believable.

Depositions are used for many purposes, such as: gathering information the witness may have that would be difficult to obtain in a written exchange of questions (interrogatories); compelling a reluctant witness to share information; testing the competence and reliability of an expert witness; and generally tying down information given under oath.

Interrogatories are a series of written questions submitted to the other party. Because interrogatories are in writing and do not require the "live" presence of the attorneys and the court reporter, they are used more frequently than depositions. The answers to interrogatories must be under oath and filed within a prescribed period of time.

Interrogatories are commonly used to obtain more information or details about a particular item such as an employment contract or pension plan information.

Requests for production of documents require the spouses and third parties to produce documents necessary to understand the issues in the case.

Informal Discovery

Informal discovery can be as simple as one lawyer calling the other lawyer and saying, "Send over to me everything you've got about the Smith case including financial affidavits, tax returns, check stubs, investment statements, list of assets, and anything else we might need to see." And the other lawyer responds, "Okay, you'll have it by Friday."

Well, it might not be quite that simple but if the other spouse's lawyer is cooperating, he/she adds to the informal discovery process by voluntarily providing requested information and documentation. The best lawyers do this without hesitation and give complete relevant financial facts. The lawyer knows he will be required to provide this information anyhow, and he can save time for the client and himself, as well as the expense of formal discovery.

Although a lawyer is within his rights not to disclose information that is not requested, he/she cannot go along with intentional deception.

Temporary Orders

Whether the case takes 90 days or five years, the period between the beginning and the end of the case is a time when the financial and emotional life of the family goes on. There are children to feed, mortgages to pay, and insurance premiums and claims to handle. This is the "temporary period." It's during this temporary period that people usually reach a settlement about how to manage their lives while they are waiting for the case to be over. If they can't settle, they go to a judge to have a temporary orders trial.

A common temporary order is one that orders one spouse to pay support to the other until the divorce trial takes place ("pendent lite"). Before the judge can grant the motion, it must be shown that support is needed and that the spouse is capable of paying the amount requested.

To show need and the ability to pay, most states require that a sworn statement (the Financial Affidavit) be prepared, detailing both spouse's living expenses and incomes.

Financial Affidavit

A financial affidavit is a legal document. It is a filing with a court of the parties' income and expenses, assets and liabilities. Each state has its own form of financial affidavit. Sometimes, different counties within a state have their own variations as well.

The financial affidavit provides a snapshot of the client's financial position as of a specific date. The assumptions used to prepare the affidavit (such as inflation rate for education expenses or replacement costs for health insurance) should appear as footnotes to the affidavit.

For a copy of a financial affidavit, see Figure 4.1 in Chapter 4 (Data Gathering and Analysis).

Permanent Orders

Permanent orders are the final divorce orders, which dissolve the marriage and enter permanent financial and child-based orders. Couples reach the permanent order stage by resolving their situation in one of two ways: they either settle or they go to trial. Some states allow divorce by mail.

The tax filing status for each spouse is determined by the legal status (divorced or married) on December 31. If the couple doesn't get divorced until December 31, they are divorced for the entire year. If they don't get divorced until January 1 of the following year, they are married for the entire prior year. Income taxes can be figured for the couple based on married, filing separately, or head of household versus a joint return to see which would give the greatest tax benefit.

TRIAL

If the parties don't settle, then they go to trial and have a judge decide their future. Only about 5% of divorce cases actually go to trial. Whether they settle "on the courthouse steps" or earlier is impossible to ascertain. But the fact that about 95% of them settle is good because if they have come to an agreement on their own, they are more likely to honor that agreement than one handed down to them by the person in the black robe. In one sense, they have taken charge of their own futures and it gives them a feeling that they are in control. Going to court takes all control away from them.

Divorce cases are generally decided by a judge and not a jury (although a couple of states have limited jury trials). If one of the divorcing spouses strongly opposes the judge's decision, he/she can appeal for either of the following reasons:

Error of law. A judge's decision can be appealed if one of the parties feels there was an error in the interpretation of the law or if the judge handed down the decision incorrectly.

Abuse of discretion. A judge's decision can be appealed if one of the parties feels there was an abuse of discretion.

At the end of the trial the judge will then make a decision as to what party has prevailed and what the parties will receive in the way of the demands made by each.

There always is the possibility the case may be appealed, which means that the case can be taken to the next higher court.

PRO SE DIVORCE

Most people who go through divorce have lawyers. But there is a trend in this country where people do not retain lawyers, but instead choose to do it themselves. People who go through divorce without a lawyer are called "pro se." The statistics are that at least 50% of the people who go through divorce or sue each other after the divorce have no lawyer.

Disadvantages of "pro se" divorces include:

1. Income taxes. Many people do not understand the tax consequences of transferring certain property, such as a house or stock with a low cost basis. One spouse may be stuck with an unexpected, huge tax bill.

2. Missed assets. If the parties don't completely understand the difference between marital and separate property, some property may be transferred without fully understanding the legal ramifications.

3. Pensions. Sometimes retirement accounts are the most valuable marital asset. If the parties do not fully understand the retirement plan they could grossly undervalue what is to be divided (see Chapter 8). Some also fail to comprehend the consequences of the death of the employee or the non-employee. In these cases, benefits could revert to the company rather than to the beneficiaries the parties intended.

NEGOTIATING STRATEGIES

Generally, there are four strategies that divorcing spouses use when negotiating a settlement:

1. The parties direct the negotiation themselves. Most people who are getting divorced can't talk to each other so this approach doesn't always work. The "pro se" population is generally more able to talk to each other because they are working without lawyers, and because they are trying to settle.

2. Lawyers direct the negotiation. One lawyer represents the husband and one represents the wife.

3. Settlement letters. The lawyers send letters back and forth.

4. Four-way meetings. These are meetings with both lawyers and both spouses to trying to reach a settlement.

CHAPTER ENDNOTES

(1.) See Ohio State Bar Association, The Law & You: A Handbook of General and Everyday Law Affecting Ohio Citizens, p. 143 (13th-edition), at: http://downloads.ohiobar.org/conres/lawandyou/ The_Law_and_You_Book_Final_6_19_07.pdf.

(2.) Ibid.

(3.) Ibid.

(4.) Ibid at p.144.
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Title Annotation:Part 1: LEGAL ISSUES
Publication:Tools & Techniques of Divorce Planning
Date:Jan 1, 2008
Words:3158
Previous Article:Chapter 1: overview and history of divorce.
Next Article:Chapter 3: alternative dispute resolution.
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