ATTORNEY’S FEES AND ABILITY TO PAY POST-DIVORCE
May 16, 2013 § 1 Comment
It’s a well-settled principle of Mississippi law that a prerequisite to an award of attorney’s fees in almost all non-contempt cases is proof that the claiming party does not have the ability to pay his or her own attorney’s fees. It’s something we’ve posted about here before.
What about where the spouse claiming an award of attorney’s fees has a present or pre-existing inability to pay, but the equitable distribution award makes adequate provision, leaving no discrepancy?
The COA addressed that very question in Jones v. Jones, rendered April 30, 2013. In reversing the chancellor’s award of attorney’s fees and expert-witness expenses, the COA, per Judge Maxwell, stated:
¶37. We also reverse the award of $18,250 for attorney’s fees and expert-witness expenses. “The question of attorney’s fees in a divorce action is a matter largely entrusted to the sound discretion of the trial court.” Watson v. Watson, 724 So. 2d 350, 356-57 (¶29) (Miss. 1998) (quoting Ferguson, 639 So. 2d at 937). But when “a party is financially able to pay her attorney, an award of attorney’s fees is not appropriate.” Id.
¶38. In Watson, though “reluctant to disturb a chancellor’s discretionary determination whether or not to award attorney[’s] fees,” the supreme court reversed and rendered an award of attorney’s fees because, “with respect to the financial position of the parties after the divorce decree, it [was] evident that [the wife was] financially able to pay for her own attorney’s fees.” Id. at 357 (¶30) (emphasis added); see also Pacheco v. Pacheco, 770 So. 2d 1007, 1012-13 (¶¶26-28) (Miss. Ct. App. 2000) (affirming denial of attorney’s fees because wife’s property award enabled her to pay her attorney’s fees). Here, in finding Jane unable to pay, the chancellor did not consider Jane’s financial position in light of the divorce decree and property division. Jane was awarded almost two hundred thousand dollars in cash, secured by a lien on John’s real property and businesses, a home in Oxford free and clear of any liens, and dividend-paying bank stock, as well as multiple retirement accounts. As in Watson, under the circumstances, we find the award of attorney’s fees and expert-witness expenses to be an abuse of discretion. We reverse and render this portion of the judgment.
As I have said here before, one would think that attorneys would be super-zealous in making an airtight record on attorneys fees, but in my experience the proof is quite often slap-dash and incomplete.
If you want to make your award of attorneys fees bullet-proof, make sure that there is proof in the record to support a finding by the chancellor that, even with the equitable distribution, your client has an inability to pay. Is the equitable division readily liquidable, or is the bulk of it tied up in equity? Will liquidation to pay attorney fees have adverse tax consequences, as with an IRA? Will payment of attorney fees use up most, or all, of your client’s cash? Will it take months or even years to collect all of the equitable distribution? All of these are factors that the judge will consider if you make sure to put supporting proof in the record. With that kind of proof in this case, Jane might have had at least a partial, viable claim for attorney fees that would have survived on appeal.