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Entries in division of assets (9)

Friday
Jan152016

To Bifurcate, or Not to Bifurcate: That is the Divorce Question

Divorce Attorney

 

 

by Veronica R. Woods

818.907.3250

 

Divorce Bifurcation

 

Some divorcing couples may want their divorce resolved as quickly as possible. In California, the legal minimum time requirement that a dissolution can be entered is six months from the date of service of the Petition to the entered judgment. However oftentimes, complex financial matters or other contentious questions make the process much longer.

Fortunately, California’s Family Code provides an alternative option: Courts may allow parties to request a bifurcation, which essentially gives the Court the leeway to grant a divorce before other outstanding issues are resolved. Bifurcation is the separation of one or more issues in a case.

The California Rules of Court: Rule 5.390 provides for the separate trial of 13 issues, if a quicker resolution of a family law matter may help move proceedings along: 

  • Postnuptial or prenuptial agreement validity
  • Date of separation
  • Date of asset valuation
  • Separate vs. community property questions
  • Distribution of increased value of a business
  • Value of business or professional goodwill
  • Termination of marriage or domestic partnership
  • Custody and visitation rights
  • Support for child, partner or spouse
  • Attorneys’ fees
  • Equitable property and debt distribution
  • Claims for reimbursement
  • Other specific issues

Submitting a motion to bifurcate also means meeting certain demands. If the reason for bifurcating involves determining an alternate date of valuation of assets for example, the party making the motion will have to give the reasons for alternating the date and whether or not the proposed date applies to all or only some of the assets.

Other indemnities must be made to protect both spouses and children, in regards to health insurance, retirement, social security and other estate benefits.

Practical reasons for “Status Only” Bifurcation

There are some practical reasons to submit a motion to bifurcate. In a status-only bifurcation, which effectively restores the parties to “single” again, a common motive is that one or both of the parties wish to remarry immediately. Another less common reason, is to protect the best interests of the children, as in the case of Dwayne Wade’s dissolution in Illinois.

Financially, there are a few reasons: 

  • Tax Incentives: Under IRS rules, a party may file as a single tax payer or “Head of Household” if s/he had a divorce finalized anytime that year, even on December 31st. Remember, spousal support payments are deductible to the payor. Conversely, the party who receives spousal support must claim the money as income.

  • Bankruptcy: If one spouse files for bankruptcy, couples may seek bifurcation so the divorce proceedings can proceed while bankruptcy issues are still being resolved.

  • Time is Money: One party refusing to agree to certain issues to prolong the proceedings just leads to more legal fees. Reasons vary: a party may want to put off the ex’s remarriage or one party is highly emotional and unwilling to compromise, dragging on proceedings for as long as s/he can. 

Legislative Intent: Slight Evidence Required

The legislature intends “that the dissolution of marriage should not be postponed merely because issues relating to property, support, attorney fees or child custody [are] unready for decision.’ [Citation.]” (Gionis v. Superior Court (1988) 202 Cal.App.3d 786, 788.) The court is more concerned that parties forced to remain legally bound to one another when this status can do nothing but engender additional bitterness and unhappiness.” (Hull v. Superior Court (1960) 54 Cal.2d 139, 147-148.) A decision dissolving the marital status is reviewed under the substantial evidence standard. No valid purpose is served by requiring the parties to stay married.

Motion to Bifurcate Divorce

Opposing a Bifurcation

The burden of evidence to defeat a status only bifurcation must be compelling.

In the recent case of In re Marriage of Kimberly M. and Fletcher Jones, Jr., the Fourth Appellate District Court of California upheld the trial court’s decision to allow bifurcation and end the marriage in status.

In 2012, Fletcher made a motion to bifurcate based on, among other reasons, detrimental effects on future investments. Kimberly alleged her spouse did not comply with preliminary disclosure requirements – these must be filed before a bifurcation judgment is granted under Family Code §2337(b). She asked for 31 conditions to be met if bifurcation is granted.

Though Fletcher provided the required list of assets and debts, and though Kimberly did not disagree that the marriage should be dissolved, she did contend that Fletcher should be required to provide current values of the listed assets and debts, and that she be allowed an opportunity to seek further conditions of the bifurcation.

The lower court found that the disclosure and augmentations Fletcher provided were sufficient to allow the bifurcation.

Additionally,

…Kimberly made no showing the rejected conditions were necessary to protect her interests. She argues they are necessary because the early termination of the marital status “may impact upon property division issues” . . . The same can be said in every situation wherein the court bifurcates the trial, resulting in termination of the marital status prior to resolution of other issues.

Here, the court reaffirmed the legislative intent that severance of a personal relationship which the law has found to be unworkable and, as a result, injurious to the public welfare, is not dependent upon final settlement of property disputes. Society will be little concerned if the parties engage in property litigation of however long duration.

 

Veronica R. Woods is an attorney in our Family Law Practice Group. 

 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Wednesday
May272015

Family Law: Special Considerations When Representing Professional Athletes

Celebrity Divorce - Athletes

 by Anthony D. Storm

 

While we await news of Tom Brady's Deflate-Gate appeal, the National Basketball Association playoffs coming up fast, and the latest hints that Lamar Odom and Khloe Kardashian may not follow through with their divorce after all, it is apropos to address issues that are germane to the family law representation of a professional athlete. 

Like most professions, a professional athlete is compensated pursuant to his or her employment contract.  However, while that employment contract may be based on skills obtained before or during the marriage, may be negotiated during marriage, and provide a predictable sum of earnings, those earnings are often based on performance after separation. 

So, the question arises, do the payments belong to the community or are they separate property?

Furthermore, athletes may receive additional income from sponsorships and endorsements above what is set forth in their employment contract.  Even though there is no celebrity goodwill in California, this additional income may be income available for support. 

Additionally, depending on the athlete’s income and where the parties live, he or she may be a high-earner.  What may be considered a high-earner in Bakersfield may not be a high-earner in Beverly Hills. 

Finally, custody can be more complicated---how do you work visitation when the athlete is travelling for games? Who pays for the travel?  Does the child travel alone, with a tutor, and where does he or she stay while away? 

There are no simple answers, but awareness of these issues is critical and provides an opportunity for good lawyering. 

Anthony D. Storm is a Divorce Lawyer in our Family Law Practice Group. Contact him via email: astorm@lewitthackman.com, or by phone: 818.907.3248.

 

 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Friday
Aug292014

Breaking Up is Hard to Do: Cohabitation Agreements Make it Easier

Cohabitation Agreements

by Lovette T. Mioni

 

According to a U.S. Department of Health and Human Services report, more and more couples are choosing to live together – either in a premarital cohabitation arrangement, or in lieu of marriage altogether.  

The report showed that 48 percent of women aged 15-44 interviewed between 2006 and 2010 lived with a partner without marrying. Only 34 percent of women in the same age group did so in 1995.

Many couples getting ready to officially tie the knot will consider a prenup – a smart choice for anyone with assets to protect, whether they be business interests, family heirlooms, or growing financial expectations. The growing number of couples who choose not to marry, or to delay marriage, should protect themselves too.

Cohabitation Agreements:
Why Do You Need One?

Unmarried couples living together for several years (or any amount of years) do not have a common law marriage in California and community property laws do not apply to unmarried couples.

However, one party could allege there was an agreement between the parties that Party “A” would provide for Party “B”, creating an interest in Party “A” assets that otherwise wouldn’t arise absent an agreement. Courts have held that express or implied contracts between unmarried cohabitors are enforceable. 

For example, in the case Marvin v. Marvin, the Court commented, “[A]dults who voluntarily live together and engage in sexual relations are nonetheless as competent as any other persons to contract respecting their earnings and property rights.”   

Individuals may unintentionally acquire/relinquish certain rights because of their relationships with their partners. A Cohabitation Agreement is a written contract between two people that are not married. It sets forth the mutual rights and obligations regarding  property, financial support, and estate planning.  We recommend implementing a Cohabitation Agreement to provide each party with financial expectations and general obligations for the relationship.

Consider drawing up a Cohabitation or Living Together Agreement to determine:

  1. Financial responsibilities.  

  2. Ownership for joint purchases, i.e. vehicles, furniture, home, etc.

  3. Residential financial obligations, i.e. rent or mortgage, utilities, insurance, etc.

It's not just the breakup that can be hard on cohabitants. The death of a partner can also create unforeseen hardships for the survivor. A cohabitation agreement may be used to determine if a surviving partner has the right or obligation to retain any property acquired after the couple started living together.

All in all, it's best to be prepared for any eventuality, whether a couple cohabitates until death do they part, or not. Each party in a cohabitation relationship should have his or her own legal counsel ensure their individual interests are determined in a Cohabitation Agreement.

Contact our Family Law Practice Group for more information. 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Wednesday
Feb122014

California Family Law: Broken Promises, Broken Proposals

 

Who keeps the engagement ring?by Lovette T. Mioni

 

February 14th is considered the most romantic day of the year for many. Sometimes, romanticism spurs a compulsion to make a grand gesture, like a very public proposal. Whether public or private, about six million people expect or will offer a marriage proposal on Valentine's Day, according to CNN.

Sometimes the best laid plans go awry though, and that is often the case with proposals. In that situation, who gets to keep the ring?

General rules of etiquette imply that a fiancée return the engagement ring to the former intended when a wedding is called off, regardless of which party cancelled the wedding plans.

In California there is a law that addresses this issue. California Civil Code §1590 says:

Where either party to a contemplated marriage in this State makes a gift of money or property to the other on the basis or assumption that the marriage will take place, in the event that the donee refuses to enter into the marriage as contemplated or that it is given up by mutual consent, the donor may recover such gift or such part of its value as may, under all of the circumstances of the case, be found by a court or jury to be just.

This means that civil courts in California look at who broke the engagement. If an engagement ring donor breaks off an engagement, it is likely a court would rule that the recipient, anticipating marriage, may legally keep the ring. If the donee broke off an engagement, the donor has the right to legally reclaim the ring. 

If you are considering giving a very expensive engagement ring, or a family heirloom engagement ring, we recommend obtaining a prenuptial agreement that sets forth who will keep the engagement ring in the event of a break up. 

Contact one of our Divorce Attorneys for more information.

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Friday
Jan032014

Why Get a Prenup? Marriage Is a Financial Partnership Too

Marriage and Money: Prenups

by Lovette T. Mioni

 

Most people wouldn't go into business without insurance. So why do so many couples get married without a prenup? 

Marriage, like it or not, is a financial partnership – whether or not the couple decides to keep their finances separate or comingle them. If they're smart, they'll talk about their expectations and responsibilities before they tie the knot, whether they have a few grand tucked away in a savings account, or millions of dollars invested in complicated portfolios.

The financial conversation is necessary to every couple. The prenup conversation though, will particularly benefit anyone who:

  • Owns a home, real property, or valuable collections/heirlooms

  • Owns a business

  • Has a stock or retirement fund

  • Expects, or already has an inheritance

  • Has a child or children from a previous marriage

  • Has loved ones that need special care/elder care

  • Is pursuing a degree or license in a potentially lucrative profession

  • Expects dramatically increased earnings in the future

A legally enforceable prenup is fair to both parties, and is not signed under duress.

It should define and protect community and separate property, support an estate plan, save time and money by reducing conflicts in the event of a divorce, and lay down some ground rules for deciding future problems.

Since California is a no fault state, the parties can't write in financial penalties for bad behavior or making lifestyle decisions, such as cheating, refusing to have children, or taking up gambling.  

They can however, protect themselves from debts one of the parties incurs should s/he make some of these choices. That's why prenups are like insurance.

When Should You Ask for a Prenup?

Some people find it easier to mention their preferences for a prenup very early in a relationship, as part of a general conversation regarding marriage, for example. This way the boyfriend or girlfriend will know what to expect further down the road, should the relationship progress more seriously.

Others ensure they talk about prenuptial agreements before the engagement; while some others wait until the 11th hour, fearing hurt feelings and the potential end of what was once a good relationship.

Generally speaking, the earlier you bring up the idea, the better.

Whenever you decide to pop the question – the prenup question, that is – know that California law requires there be seven days between presentation and execution of the prenuptial agreement, Family Code §1615(c)(2). This gives time for the person receiving the prenup to seek legal counsel to protect his/her own assets.

Contact one of our Prenuptial Agreement Attorneys for more information.

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

LEWITT HACKMAN | 16633 Ventura Boulevard, Eleventh Floor, Encino, California 91436-1865 | 818.990.2120