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 Family Dissolution of Marriage/Divorce Do You Want a Divorce? One of the first questions to figure out is whether you want a divorce. It is important to realize that the legal system is not a form of counseling, and lawyers are not well equipped to help people determine whether they will need a divorce. The legal system should be considered the final act, after all reflection, analysis and counseling results have been considered. It is unwise and unrealistic to expect your lawyer to help you determine whether you should obtain a divorce. Your lawyer's role is to analyze what will happen if you obtain a divorce, and then proceed, if you are a willing client, to take all steps to obtain one. Often, there are a number of resources available to help one determine if a divorce is the proper action to take. Many Employee Assistance Programs [EAPs] are well equipped to counsel either couples or one spouse in whether they ought to obtain a divorce. Many counselors can provide excellent resources to help spouses sort through marital difficulties in an effort to "save" their marriage. Likewise, many churches or other community groups can provide effective services to help in this determination. The person inquiring about divorce should know that other than to make a calculated analysis of what will happen legally if a divorce is granted, a lawyer is best able to help after a determination to seek a divorce has been made. Similarly, the legal system ought not to be counted on to assist in reconciliation issues or prospects. On should be aware that the legal process surrounding divorce can be a bit "cold and lifeless" in that it can seem to aggressively push a divorce to its conclusion, yet rarely affords many opportunities to reconcile. Indeed, if there is some doubt about the need for divorce, a couple might even attempt a separation period to help in the process. There is a concept in the law known as a Legal Separation, which we will discuss shortly, but this is not the type of separation that is being advocated here, since as we will see, there is little difference in most states from a divorce and a Legal Separation. Contested vs. Uncontested Divorce Once you have made an informed decision that you will seek a divorce, the next question to decide is whether it will be contested or uncontested. One of the main reasons to make this determination is so that you can decide how to proceed legally, and so that you can obtain some idea of how much this process will cost. As an example, a true uncontested divorce of a couple, married for 2 years with no children, renting an apartment furnished with the belongings each brought to the marriage, and little or no savings, will cost very little in legal fees. Many would argue that an uncontested divorce could be handled without an attorney in an effective manner. We do not believe that handling a divorce without an attorney is ever a sound idea, because of the multitude of legal issues that can often arise after the divorce, but quite frankly, there are some cases in which you may not need an attorney. In making this determination, it is important to note that most spouses, if asked early on, would claim that their divorce would be uncontested. Then all of a sudden, the issue of children, visitation rights, child support and similar issues, seem to arise without warning and create a number of "contests" between the spouses. The result is that many divorces that seem, on their fact to be uncontested, may be contested, and one ought to analyze the following issues to help decide what type of divorce yours will be. Community Property States Understanding the Community Property Concept Community property is property that is acquired after the date of the marriage by the joint work, sacrifice and stress of both you and your spouse. Each spouse owns one half of these assets, whether they are divided, divisible or not. This ownership interest defines what each spouse owns during the marriage. Not all property acquired after marriage is community property. If one spouse receives a gift, or regular gifts, from their family members, for example, that property is the separate property of that spouse. The designation of this property as separate [whether it is "separate" or "community" is called the character of the property] can change in certain circumstances. If the gift is used to pay for food, shelter or other marital purposes benefiting the other spouse, this previously separate property may now become community property since it may be deemed to have been "donated" to the marital community. Please note that this is a generalization and there are many factors that make up the character of the property. Courts use complicated principles and formulas in an attempt to determine the character of certain marital property. Also, property acquired before the marriage may be either community or separate property depending upon the use of the property after the marriage. As an example, if one spouse had $40,000 in Certificates of Deposit before a marriage and the Certificates were simply renewed and the proceeds reinvested, the Certificates might likely remain separate property. However, if the Certificates were used as collateral for a marital loan that was taken out to purchase furniture for the spouses' house, this can, in some instances, arguably, change the character of the property. Such a situation might be one that must be resolved by the court system. Agreements Defining the Character of Property Premarital agreements, often called prenuptial agreements in some states, can help to specify before a marriage what the character of each piece of property owned by each spouse will be. While these agreements sometimes make for nice neat resolutions of property disputes upon divorce, the idea of planning for divorce sometimes prevents couples from entering into these agreements. Also, what is often not discussed about a prenuptial agreement is that once made, it can be modified by the conduct of the spouses or spouse during the marriage. An example may illustrate this point. Assume that a spouse has $100,000 in stocks before being married. The couple enters into a valid prenuptial agreement in which it is specified that the stocks are the separate property of the one spouse and any dividends or interest from these stocks will be reinvested and remain the separate property of the spouse also. After five (5) years of marriage, the spouse decides to stop the reinvestment of the dividends and interest and designates these to be deposited each month in the couple's checking account to be used to purchase food and shelter. This practice continues for five more years. What is the character of the stock now? What is the character of the dividends and interest now? First, the stock would likely remain the separate property of the spouse pursuant to the agreement. However, it is entirely possible that the other spouse could argue that the dividends and interest income became a community asset. The final determination would depend on other factors during the marriage, but it is possible that the prenuptial agreement could be considered to be modified by the subsequent conduct of the parties during the marriage. These principles may serve as an introduction to the community property laws. Your state may not have these, but if it does these principles might help you better understand the need to seek the services of an attorney both before and during a marriage should questions arise concerning the nature of property. Non-Community Property States Ownership A large majority of states do not have a community property characterization scheme of marital asset ownership. In these states, there are many laws which determine who owns which assets in a marriage. The following is a very general and brief statement about ownership of assets in a marriage. Should this become a problem or an issue in your case, it is recommended that each spouse seek the counsel of an attorney, in advance of taking any action with respect to incurring any debts, purchasing any property or disposing of any assets. In general, all property in the marriage is considered to be of joint ownership. But, upon dissolution, the general rule is that any property you brought to the marriage remains yours. Again, this is a generalization and certain factors can affect the ownership of this property. Marital Debts Marital debts can sometimes be considered to be the separate debt of one spouse, depending upon a number of factors in a marriage. As a general rule, items purchased for the necessity of the marriage are considered to be jointly owned. Thus, both spouses are responsible for these debts. In many states, a spouse does not have the right to run up a large amount of bills for non-marriage related expenses, and to claim the other spouse is responsible for these debts, or at least one-half of them. Of course, your course of conduct may alter this rule. That is, if you have previously given your spouse the right to incur debts in your name, he/she may be deemed by a court to be acting with similar authority with respect to any new debts. Interestingly, a spouse is not responsible for the contractual obligations of the other spouse, unless they are for the benefit of items necessary for the family or the home. Needless to say, interpretations of this concept can lead to wildly different understandings of the word "necessary." Each state may have court cases in which disputes similar to those spouses may have already been litigated. Lawyers can research these in an effort to provide assistance or guidance should you and your spouse have a different opinion of whether a certain contract might be necessary for the marriage. There are, however, no easy results and the outcome may vary depending upon your state and its courts. Dividing Property in a Divorce Analysis of a Hypothetical Situation Many of the principles applicable in this area are best understood by illustrating them with a hypothetical set of facts. Throughout each of the following sections, we will examine the concepts we are discussing in light of the following hypothetical medical issue: What if the father of two children who is the only breadwinner in the family is crippled, and paralyzed in a car accident at the age of 36? Character of Property in a Community Property State Legal Question - What happens in a community property state if the husband is paralyzed in a car accident? In truth, nothing happens as to ownership of property in a marriage, so long as the parties remain married. There may be some steps the couple can take with respect to debts, including bankruptcy if necessary, but the character of property would not change. Character of Property in a Non-Community Property State Legal Question - What happens in a non-community property state if the husband is paralyzed in a car accident? Again, there would be no significant changes in the ownership of property as long as the couple remained married. Dividing Property in a Divorce - Community Property State What happens if after the accident the father is paralyzed and the wife files for divorce, since supporting her crippled husband for 30 or 40 more years was not in her "plan."? This sounds cruel, but courthouses are full of these types of cases, some much worse than this. The paralysis of the husband will affect the divorce decree in a very large way; that is, the care of the husband will almost certainly be on the mind of the judge in this case. The fact that the wife did not work would also play a large role in this case. If the couple had very little to divide, the property settlement agreement might contain a variation of a simple division and the marriage is dissolved. But what if the husband had a job that paid some $75,000 a year and a pension fund that had already accumulated $150,000? In a community property state, the presumption would be that both parties owned the pension fund in one-half shares. As we indicated, thousands of fact situations might arise that would create a different result. However, in a court proceeding, the arguments on both sides as to the pension fund would be as follows: The husband would argue for a larger share because of the necessity to care for his medical needs for the rest of his life. The wife would argue that her efforts allowed the husband to accumulate the retirement fund, and she ought to have a larger portion of this fund. Needless to say, this would be a difficult decision for any judge. In deciding this issue, judges would likely examine factors such as the income of the parties from other sources, if any, the expenses incurred by each of the parties, especially those unrelated to the family or medical necessities, the age of the parties, the earning ability of the parties after the divorce and the age and number of children. Especially important in our hypothetical situation might be the future earning capacity of the parties. While the father would not be able to work, the mother would be deemed by the court to have some earning capacity. As we have indicated, predicting results in these cases without the benefit of all the facts, witness, testimony and evidence is almost impossible. This discussion is simply meant to highlight the major issues in each case, not to provide definitive answers. Dividing Property in a Divorce - Non-Community Property State In our same hypothetical situation, the husband's pension fund would be examined in light of his ownership of the fund. Courts would examine the length of the marriage, the amount in the fund when married, the use of any loan proceeds from the fund, the amount of money deferred, if any, from the normal paycheck available to the couple each pay period, and related factors. Courts would be attempting to make the best equitable distribution that would be fair to each spouse, even if the amount awarded to each spouse was markedly different. For example, in our example, if the husband had already accumulated $ 125,000 of the $ 150,000 pension fund by the time the couple was married, in a non-community property state, the courts would generally not apportion an equal share to the wife. Again, however, the totality of the circumstances is what would govern a judge's determination of which property was awarded to which spouse, and thus, it is extremely difficult, without enlisting the help and guidance of an experienced lawyer who has practiced before the family law courts in your area. Property Settlement Agreements Division of Property Principles One of the most significant and fought over parts of the dissolution process is the agreement which is typically under a court order and which specifies the terms by which the spouses will divide their assets and deal with each other in the future. Such matters as spousal support, child support, child custody and visitation rights are all generally decided and set forth in a property settlement agreement. Naturally, because of the nature of these elements, contests, disputes and ill feelings may result from having to decide one or more of these factors. It is important that one understand how these contentious issues may escalate the litigation process and the accompanying legal fees. Perhaps, an understanding of what happens may enable some spouses to take steps to limit the amount of disputes and the resulting legal fees from these fights. Division Example/Results Typically, if the parties agree on a division of property and there is no "overreaching" by one party, courts will tend to accept such divisions. In the absence of an agreement as to some or all of the assets, courts will utilize an analysis of the character of each asset and debt in a marriage in trying to divide the couple's property. The original ownership of an asset will weigh heavily in the analysis, along with the length of time of the marriage, the manner in which the parties treated debts and assets during their marriage and other factors related to the fairness of awarding ownership. What is important to realize is that in non-community property states, an equal division of assets is not usually the goal of the court. Instead, the fairness to each of the parties is what courts strive for in making such divisions. Division issues can be extremely difficult to resolve, and many states will vary in how they will divide certain assets. Alimony Most states have laws which provide that one spouse may receive money for the support of the spouse. Incidentally, some states like Texas do not provide for alimony payments to either spouse, generally regardless of the circumstances which may warrant such payments. Remember that this is a separate support payment for a spouse and does not affect support for children that are discussed shortly. Usually, states will have provisions that attempt to compensate the spouse which may have had no job or occupation at the time of the dissolution, and because of the nature of that marriage, may have been caring for children instead of developing occupational skills and/or promotions. No longer, however, is it a given that the one spouse will receive some alimony payments as part of the property settlement agreement. By state, the calculations of these payments vary so widely that one cannot make any generalizations. Many courts will consider the number of years of marriage, the number and ages of children who will live with one of the spouses, the standard of living the couple enjoyed before divorce, the occupations and income level of each spouse, the number of years of earning capacity of each spouse, and the health of each spouse. Because of the individual analysis of each of these factors, it is conceivable that a professional or wealthy wife would have to support her husband. Naturally, the reverse could be true also. In some cases, no alimony will be ordered. Aside from these generalizations, there is really no predictability about such an award that could be determined in advance. Thus, this is an area where pre-planning may be limited. Also, many spouses go into a divorce in a friendly manner, seeking to get divorced and have no real contest. The problem is that many fail to study these issues of alimony, support and custody, and then find out, in the midst of the proceedings, that the divorce will be contested. Attorneys' Fees/Costs State laws vary in whether a spouse can collect all or some of the fees paid to their attorney in seeking a divorce. You should know that there is a possibility of such a recovery in many states, and that you ought to request an opinion of the likelihood of recovering some or all of your legal expenses from your spouse with your Plan Attorney. However, any guarantee that you will be able to recover your legal fees from a divorce should be seriously examined for its truthfulness, as many factors may determine whether attorneys' fees will be awarded in each case.
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