MODIFICATION AND CONTEMPT: WHICH VENUE?

February 10, 2011 § Leave a comment

Steve and Nancy are divorced in Clarke County, Mississippi.  The divorce judgment awarded custody of the three minor children to Nancy and ordered Steve to pay her child support.  Shortly after the divorce, Steve relocates to the coast. After a  year or two, Nancy remarries and moves to Tupelo with her new husband. 

It has been six years since the divorce, and now Nancy wants Steve to begin paying more child support.  Steve wants to file a contempt/modification action against Nancy for her interference with his visitation, and to gain custody of their oldest son, who now wants to live with dad.  Nancy has not lived in Clarke County in the past four years, and Steve has not lived there in the past five years.      

Which chancery court will have jurisdiction?  Lee County where Nancy and the children live?  Harrison County where Steve lives?  Or is it the county where the defendant (respondent) resides, based on who files first?

The answer is:  None of the above.

Clarke County will continue to have jurisdiction to modify and enforce its own judgments, even though neither party any longer resides there.

In the case of Reynolds v. Riddell, 253 So.2d 834, 836-837 (Miss. 1971), the supreme court held that the court that had original jurisdiction and rendered the judgment is the court that retains jurisdiction to modify and enforce that  judgment, regardless of the residence of the parties since the time.

The appellant in Reynolds had argued that the version of MCA § 93-11-65 at the time conferred jurisdiction to determine and modify child custody on any Mississippi court where the child resides or where the party having actual custody resides, or where the defendant resides.  The phrase “party having actual custody” must pertain to a party who obtained custody in in original proceeding and hence applies to modifications, the appellant argued.  Not so, replied the supreme court opinion.  It stated that the legislative intent of MCA § 93-11-65 was:

” … to provide a means of judicially determining the legal custody of a child in those instances where its custody was in question and no previous adjudication had been made thereasto, or either there existed conflicting custodial adjudications.  We are of the opinion that the legislature did not intend to divest a court of jurisdiction … which continues in that court for the purpose of modification upon the changed circumstances between the same parties.  We hold, therefore, that the Chancery Court of Washinton County did not have jurisdiction too modify the decree of custody entered by the Chancery Court of Sunflower County since the latter had continuing jurisdiction over these minor children.”

The court cited older cases that reached a similar result.

Three exceptions have been carved out of the rule announced in Reynolds:

  1. Reynolds itself created a procedure to remove the case to another county.  At page 837, the court stated:  “To alleviate the unfortunate condition made apparent by this case, the court vested with exclusive and continuing  jurisdiction may entertain a motion to transfer the cause to the county which is the residence of the parents and the children, and upon hearing this motion, if it appears to the court in the exercise of its sound discretion that time and expense would be saved and the best interest of the children served or promoted, then the motion might be properly sustained.” [Emphasis added]  Note the highlighted language.  It provides that the action may be transferred to the county where both parents and children reside, not to a county where one parent or one parent and the children reside.  In other words, you may proceed in the county where the custody order was originally entered, or in another county if both parents and children reside in that county, but in no other.      
  2. In Bubac v. Boston, 600 So.2d 951, 955 (Miss. 1992), the court held that a habeas corpus proceeding may temporarily modify an original custody adjudication in certain limited circumstances, and that the jurisdiction of the habeas court is statutorily in the county where the children are being illegally detained.  The habeas modification is temporary only until a permanent modification proceeding can be held in the court having original jurisdiction.  The temporary nature of habeas jurisdiction wa recently reaffirmed in Pruitt v. Payne, 14 So.3d 806 (Miss. App. 2009).      
  3. In Brashers v. Green, 377 So.2d 597, 599-600 (Miss. 1979), the court again upheld the separate jurisdiction of the habeas court and applied what was then the law regarding child custody modifications in cases involving parties in different states, which has since been supplanted by the Uniform Child Custody Jurisdiction and Enforcement Act.  And in a post UCCJA case, the same holding, Roach v. Lang, 396 So.2d 11, 13 (Miss. 1981).

Reynolds was a pre-MRCP case.  We’ve talked here before about transfers and venue, and how the two concepts interact.  I am not aware of any cases that tackle similar issues from the standpoint of rules-based transfer, but the Reynolds rationale is sound under the rules and application of venue concepts, in my opinion.   

In the case of Harry v. Harry, 856 So.2d 748, 751 (Miss. App. 2003), the court held that an action for contempt may only be brought in the same court that rendered the original judgment, and the contempt action is ancillary to the original proceeding.  Venue is exclusive in the original court even though the petitioner has moved to a different county in the same state.  “Only the court contemned has jurisdiction to punish the contemnor.”  Harry at 751; citing Tollison v. Tollison, 841 So.2d 1062, 1064 (Miss. 2003). 

Neither the Uniform Child Custody Jurisdiction and Enforcement Act nor the Uniform Interstate Family Support Act offer any help.  Those laws govern actions between a non-resident and a Mississippi resident, or between residents of other states, and do not apply to actions between exclusively Mississippi residents. 

I’ve heard lawyers say for years that there are other ways to transfer, but the only authority I have ever found one way or the other is above.  If you have something else that points in a different direction, let me know . 

In sum, bring that modification or contempt action before the court that issued the original judgment that you are seeking to modify or enforce.  If all of the parties and all of the children have relocated to another county, and they are all residing in that single county, you can petition the court to transfer the case to the new county.

MINIMUM CONTACTS FOR ALIENATION OF AFFECTION

February 9, 2011 § 4 Comments

Kristina and her husband Eric lived in Long Beach, Mississippi.  Kristina commuted to work in Louisiana, where she began having a sexual relationship with William, a co-worker.  All physical contact between Kristina and William occurred exclusively in Louisiana.

When they were apart, Kristina and William pursued their mutual infatuation via e-mail, cell phone and text messages.  Many of the electronic communications were sent and received by Kristina while she was physically located in Mississippi.

Eric discovered the relationship and asked William to leave his wife alone.  William persisted.  Eventually Eric and Kristina were divorced and Kristina moved to Louisiana and married William.

Eric sued William in the County Court of Harrison County, Mississippi, for alienation of affection, alleging that his damages occurred in Mississippi, and that Kristina had sent and received communications while she was in the state.

William moved unsuccessfully to dismiss for lack of personal jurisdiction and took an interlocutory appeal to the supreme court.

In the case of Knight v. Woodfield, decided January 6, 2011, the Mississippi Supreme Court found that the phone calls, text messages and e-mails were sufficient “minimum contacts” with Mississippi to confer personal jurisdiction.  The court cited International Shoe Company v. Washington, 326 US 310, 316 (1945), which states that “A defendant has ‘minimum contacts’ with a state if the defendant has purposefully directed his activities at residents of the forum and the litigation results from alleged injuries that arise out of or relate to those activties.”

The court also found that allowing the suit to go forward in Mississippi would not offend traditional notions of fair play and substantial justice because Mississippi has an interest in providing a forum for its residents who are injured by nonresidents and for other reasons.  

The opinion, written by Justice Carlson, includes this language about the tort of alienation of affection:

Mississippi’s interest is enhanced because Louisiana does not recognize the tort of alienations, making Mississippi the only viable forum for Woodfield’s claims … the purpose of the tort of alienation of affections is the ‘protection of the love, society, companionship, and comfort that form the foundation of marriage …’ [citations omitted] Permitting claims for alienation of affections protects the marriage relationship and provides a remedy to those who have suffered loss of consortium as a result of the conduct of others …”

Justice Waller, joined by Chandler, dissented, disagreeing with the majority that the electronic communications constituted minimum contacts with Mississippi.

We’ve talked here before about the viability of alienation of affection as a cause of action.  From the language in this case, it appears that alienation is as viable as ever.

ANOTHER NAIL IN THE GOODWILL COFFIN

February 8, 2011 § 2 Comments

“Goodwill” is the term used in accounting to describe the “prudent value” of a business over and above that attributable to the value of its assets, such as its reputation with customers and the value of its brand.  An example would be the value that Coca Cola’s planet-wide brand recognition adds to the company’s value over and above the value of its assets. 

Ever since the landmark decision in Singley v. Singley, 846 So.2d 1004 (Miss. 2002), in which the supreme court reversed the court of appeals and held that goodwill is not to be considered in business valuations for divorce, the courts have wrestled with the breadth of that decision.  Singley, which involved a dental practice (in Meridian), accurately reflects the way professional practices are valued by valuation experts, who consider that the value of a professional practice depends heavily on the participation in it of its principal, so that it has no goodwill.  The question lingered, however, as to how the court would apply the no-goodwill concept in other business valuations.

It is beyond the scope of this post to analyze Singley’s progeny, the most notable of which are Watson v. Watson, 882 So.2d 95 (Miss. 2004), and Yelverton v. Yelverton, 961 So.2d 19 (Miss. 2007).  If you’re going to handle any divorce cases involving a busines, you will have to acquaint yourself with those decisions.

This post address the latest pronouncement on goodwill, which comes in the case of Lewis v. Lewis, handed down by the supreme court on February 3, 2011.    

Lewis, which was before the court on certiorari from the court of appeals, involved valuation of a business enterprise jointly owned by the divorcing husband and wife to develop residential real estate.  The court of appeals had reversed and remanded for the chancellor to correct errors in the valuation of the business.  On cert, the supreme court, by Justice Randolph, upheld the court of appeals’ reversal and remand in part, but reversed the court of appeals to add that the trial court was precluded from considering goodwill in its analysis of the valuation.  

In a cogent dissent, Justice Kitchens pointed out that Singley and the cases following it had correctly appled the exclusion of goodwill to the professional practices involved in those cases.  The business in Lewis, however, was not a professional practice.  Kitchens urged the court to recognize that Singley should be limited to solo professional practices or businesses that are closely analogous. 

Justice Randolph referred sympathetically to Justice Kitchens’ dissent, pointing out that he had raised similar concerns in his own dissent in Watson to no avail.  He pointed out that, if Singley lacked clarity on the point, the court’s decisions in Watson and Yelverton laid aside any doubt, and that goodwill is not to be considered.  He went on to say that “Stare decisis demands this result.”  Waller, Carlson and Graves joined Randolph in the opinion.  Lamar and Chandler concurred.  Only Kitchens dissented.  Pierce did not participate.    

Our appellate courts have not been presented with a business valuation involving nationally or even regionally recognized business entities based in Mississippi on a par with companies such as Viking, or Mississippi Chemical, or Structural Steel or Yates Construction.  In such a case, it would be difficult to understand how the court could overlook “enterprise goodwill” as opposed to the “personal goodwill” in the precedent to this point.  Yet our case law now is that any form of goodwill is to be ignored in valuing businesses in divorces.

A MATTER OF INTEREST FOR CHILD SUPPORT CASES

February 7, 2011 § Leave a comment

MCA § 75-17-7 provides:

All judgments or decrees founded on any sale or contract shall bear interest at the same rate as the contract evidencing the debt on which the judgment or decree was rendered.  All other judgments or decrees shall bear interest at a per annum rate set by the judge hearing the complaint from a date determined by the judge to be fair but in no event prior to the filing of the complaint.

It is error for the trial court to fail to award interest on the amount adjudicated to be owed for arrearage in child support.  Ladner v. Logan, 857 So.2d 764 (Miss. 2003). 

Although the statute expressly states that pre-judgment interest may not extend back prior to the filing of the complaint, the rule does not apply to due and unpaid child support.  That is because each payment in arrears is vested when due and becomes an automatic judgment against the obligor.  Pope v. Pope, 803 So.2d 499, 501 (Miss. App. 2002).  Each unpaid monthly installment begins to accrue interest at the legal rate, not from the time it may subsequently be reduced to judgment by a court, and it is error for a chancellor to reduce or eliminate the interest.  Dorr v. Dorr, 797 So.2d 1008, 1015 (Miss. App. 2001).  Amounts paid by an obligor in arrears are applied first to the interest obligations, and then to extinguish the principal amount of the oldest outstanding child support payment, and then the next oldest, and so on.  Brand v. Brand, 482 So.2d 236, 238 (Miss. 1986). 

The appellate courts have allowed the trial judges deference in setting the rate of interest.  Rates from three pecrent (Brawdy v. Howell, 841 So.2d 1175, 1180 (Miss. App. 2003)) to eight percent (e.g., Houck v. Ousterhout, 861 So.2d 1000, 1003 (Miss. 2003)) have been upheld.

There is no prohibition that I know of for a property settlement agreement to provide a contract rate for interest on unpaid child support or other obligations such as alimony, but I have never seen a property settlement agreement with such a provision.  The rarity is due, I am sure, to the difficulty of getting an agreement.  An advantage would be that the court would be bound to the contract rate.  See, e.g., Tower Loans, Inc. of Mississippi v. Jones, 749 So.2d 189, 190 (Miss. App. 1999), where the court of appeals reversed a circuit judge’s imposition of eight percent interest where the contract called for a 34.71% rate, and the contract rate was not usurious.  Another advantage would apply to alimony and other non-child-support obligations in that it would allow pre-judgment interest back to the filing of the complaint for enforecement; a nice perk if you can get it.  Finally, setting an interest rate at least for non-child-support obligations might be prudent in view of the authority that, if the court does not impose interest on a judgment it renders for non-child-support obligations, it is presumed that the judgment does not earn interest.  Aldridge, August 28, 1998, A.G. Opinion #98-0507.

I WISH WE COULD ESCAPE TO PARIS

February 4, 2011 § Leave a comment

But since we can’t, you can go there yourself with this slideshow from my last trip in 2005.  You may have to enable popups to view it on YouTube. 

There are many postcard sights you won’t see in this collection, but you will find some favorites as well as some out-of the way places.  See if you recognize Notre Dame, Place St. Michel, Tuilleries, St. Germain, the Marais, Orsay, the Louvre, Père LaChaise, Montmartre and Sacré Coeur, Hotel de Ville, Moulin de la Galette, Place des Abbesses, Les Invalides and the tomb of Napoleon, the Conciergerie, St. Germain l’Auxerrois, Musée Cluny, Rue Rivoli, Jardin du Luxembourg, Place République, Brasserie Jenny, Pompidou, La Coupole, Sainte Chapelle, Versailles, the quais of the Seine, Galléries Lafayette, many shop windows, and street scenes, among others.  it’s a stroll through the city and Versailles from early morning until early evening on a day that turned snowy and chilly, not too different from the weather today. 

Better yet, take your own trip and make your own slide show.  You owe it to yourself.

The music is Herbie Hancock’s version of Gershwin’s Lullaby.

I hope you enjoy.

WHAT’S BREWING IN THE CAPITOL THAT MAY AFFECT YOUR PRACTICE

February 3, 2011 § 2 Comments

Here’s a link to legislation pending in Jackson that may have some effect on your practice.

It’s early, and some things fall by the wayside while others get amended, but here are a few to take note of based on my own cursory, limited review:

  • HB 55 appears to take adult guardianships in the same direction that UCCJEA took child custody some years ago.  As our population ages, and younger people are taking responsibility for older adults, the tug-of-war between siblings for parents across state lines can create some head-scratching jurisdictional battles that this measure seeks to address.
  • HB 170 addresses an anomaly in the law created by the emancipation of a child.  The case law has held that the cause of action for past due child support becomes the enforceable obligation of the child after emancipation, even though the child support payments were due to the custodial parent.  This bill would allow the parent who was owed the support to collect it despite emancipation.
  • HB 689 is of high interest in chancery court since the supreme court handed down McDonald v. McDonald, 39 So.3d 868 (Miss. 2010), which held that hearsay in a guardian ad litem’s report is inadmissible.  This bill would correct that.  It spells out how hearsay in the report would be handled, and the procedure spelled out is similar to that proposed by Justice Pierce in his dissent to the majority opinion.

There are other bills proposing to:  revise requirements for durable powers of attorney; change acknowledgment requirements for recordation of certain instruments; revise procedures for filling judicial vacancies; clarify procedures for renewal of a judgment; specify where and when enforcement of liens takes place; spell out how disability payments are credited against child support; allow distribution of wrongful death damages without opening an estate; and filing-fee-funded increase in judicial salaries.  There’s plenty more there that might interest you.

LIMITED SCOPE REPRESENTATION NOW A FACT IN MISSISSIPPI

February 2, 2011 § 1 Comment

I’ve talked here before about “unbundling” of legal services, also called “limited scope representation,” as a way of opening legal services to people who otherwise can not afford a lawyer for matters that they consider routine or uncomplicated.   

On January 27, 2011, the Mississippi Supreme Court adopted amendments to the professional rules that allow limited scope representation.  You can read the press release, which includes a link to the amended rules, here.

On the whole, I think this is a positive development in that it will help open up access to lawyers and courts.  I do have a couple of practical concerns: 

  1. What does the lawyer do when the client insists that you limit the scope of your representation, but you know it is definitely not in the client’s best interest, and may even be to the client’s detriment, not to address other matters? 
  2. How do you draft a limited scope representation agreement that protects the lawyer from action by the client claiming inadequate representation?  

Other states have trod this path before us, so there are possibly bar opinions and case law that can provide some guidance to practitioners. 

From the court’s perspective, I can tell you that there is a serious need for low-level involvement of attorneys in those so-called simple and uncomplicated matters.  I could go on and on about experiences with pro se litigants going forth boldly where no lawyer has set foot before, using pleadings and guidance material from the internet or from so-called legal software, or from kits purchased at office supply stores.  These cases are a judge’s nightmare because the judge should never be put in the position of assisting any party with correcting and putting pleadings and other papers right, and the judge certainly can not do so when there is an opposing party.  It can be painful and demoralizing to watch a pro se party inflict serious legal damage on herself, usually without a clue as to the extent of the injury.  Even minimal involvement of an attorney in those cases would be a major benefit.

Another aspect of pro se proceedings often overlooked is that the pro se litigant has no professional or ethical duty to the court or to the opposing party.  The possibility for fraud and misrepresentation is significant.  There is no attorney, with his or her license and professional responsibility on the line to reassure the court.  Likewise, these companies that sell the kits, software and advice owe their customers no duty at all.  The insurance that a client obtains by hiring a lawyer is non-existent. 

Finally, lawyers need to be aware that the DIY legal industry stands to keep chipping away at the edges of the practice of law until there will be real competition for clients.  Your license and substantial investment in legal education, as well as your dedication to legal ethics and duty to the courts are all going to be in competition with nameless and faceless paper mills and internet sites that have no professional standing, no investment in education, and no ethical responsibilities.     

I hope limited scope representation helps reduce the trend toward more DIY litigation.  I encourage lawyers to look into limited scope representation and discover how it can enhance their practice as well as aid laypersons who feel that they can not afford legal services.

CONTINGENT FEES IN DOMESTIC CASES

February 1, 2011 § Leave a comment

Rule 1.5 (d) (1) of the Mississippi Rules of Professional Conduct provides that “A lawyer shall not enter into an arrangement for, charge or collect any fee in a dmoestic relations matter, the payment or amount of which is contingent upon the securing of a divorce or upon the amount of alimony or support, or property settlement in lieu thereof.”

In their treatise, PROFESSIONAL RESPONSIBILITY FOR MISSISSIPPI LAWYERS, MLI Press, 2010, at § 22:10, professors Jeffrey Jackson and Donald Campbell state:

Under Rule 1.5 (d) (1), a contingent fee is unethical in a “domestic relations matter” where payment is contingent upon securing a “divorce or upon the amount of alimony or support or property settlement.”  The policy behind this traditional prohibition is to prevent lawyers from taking a fee position that might give the lawyer an incentive to oppose reconciliation of the parties.  The language of the prohibition refers to “domestic relations matters” rather than only to divorce.  As such, that language would prevent a contingent fee in cases involving separation of persons who cohabited but were unmarried.  Too, the reference to “domestic matters” and to “property settlements” would prohibit a contingent fee in negotiating pre-nuptial and post-nuptial agreements between parties about to join as a couple, or considering the possibility of separation.  The state bar’s opinion is that Rule 1.5 (d) (1) does not, however, prevent a lawyer from charging a contingent fee for the collection of past due support or alimony.  [Citing Miss. Bar Ethics Opinion 88]        

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