MRCP 41(b) in Operation

September 16, 2014 § Leave a comment

The COA’s September 9, 2014, decision in In the Matter of Will of Bowling: Hicks v. Bowling, addresses a dismissal by the trial court of a will contestant’s complaint after she had rested in a bench trial.

The dismissal was per MRCP 41(b), which states, in pertinent part:

… After the plaintiff, in an action tried by the court without a jury, has completed the presentation of his evidence, the defendant, without waiving his right to offer evidence in the event the motion is not granted, may move for a dismissal on the ground that upon the facts and law the plaintiff has shown no right to relief. The court may then render judgment against the plaintiff or may decline to render any judgment until the close of all the evidence …

The defendant, Mark Bowling, moved to dismiss at the conclusion of Paula Hicks’s case in chief, and the chancellor granted the motion. Paula appealed.

Judge Maxwell set out the applicable law:

¶18. In contrast to a motion for a directed verdict under Mississippi Rule of Civil Procedure 50(a), which applies to jury trials and requires the trial judge to view the evidence in the light most favorable to the plaintiff, a Rule 41(b) motion to dismiss differs somewhat. It applies to cases tried by a judge sitting without a jury and requires the judge to view the evidence fairly. Gulfport-Biloxi Reg’l Airport Auth. v. Montclair Travel Agency, Inc., 937 So. 2d 1000, 1004 (¶13) (Miss. Ct. App. 2006) (contrasting Rule 41(b) with Rule 50(a)). When considering a Rule 41(b) motion to dismiss, the judge must deny the motion to dismiss “only if the judge would be obliged to find for the plaintiff if the plaintiff’s evidence were all the evidence offered in the case.” Id. at 1004-05 (¶13) (quoting Stewart v. Merchs. Nat’l Bank, 700 So. 2d 255, 259 (Miss. 1997)).

The standard, then, is for the court to consider the plaintiff’s evidence fairly, and to overrule the motion only if the judge would be compelled to rule in the plaintiff’s favor if her case in chief were all the evidence in the record. The court is not obliged to view the evidence in a light most favorable to the plaintiff, as in jury trials, but only fairly.

The COA went on to find that the chancellor had considered Paula’s evidence fairly, and agreed with the chancellor’s analysis of why she had not met her burden of proof in the case.

The distinction between viewing the evidence in a light most favorable to the plaintiff and viewing it fairly can be major. In the former, the judge must tilt the perspective, so to speak, in the plaintiff’s favor. In the latter, the view is more even-handed. Knowing the distinction and being able to apply it to the facts in your case could mean the difference between winning and losing your case on a R41(b) motion. Keep in mind, though, that nothing can save your case if you have not met your burden of proof. That means using those checklists and proving every applicable factor.

 

The Bite of Draftsmanship

September 15, 2014 § Leave a comment

How you draft your legal instruments can have a huge impact on your clients’ future.

Take, for instance, the parties’ property settlement agreement (PSA) in the case of Aaron v. Aaron, a COA case handed down September 9, 2014. George and Annie Aaron were divorced in 2002 on the ground of irreconcilable differences. At the time, George was employed with the Amory Police Department, and was a participant in PERS. We don’t know from the court’s opinion the exact language of the parties’ agreement, but we know this much from ¶ 1:

As part of the divorce, George agreed to pay Annie one-half of his retirement funds acquired during the marriage. The judgment stated the funds would be transferred through a Qualified Domestic Relations Order (QDRO). At the time the judgment was entered, George was not receiving any retirement benefits. The judgment did not state which party was responsible for entering the QDRO.

We also can divine from the opinion that: the language of the PSA did not specify whether Annie was to receive 1/2 of the retirement accumulated during the marriage, or 1/2 of all George’s retirement, a significant portion of which would be earned after the divorce; it did not spell out what consideration would be given to future pay increases on George’s ultimate obligation to Annie; it also did not settle the question whether the payments were intended to be paid out in a lump sum as property settlement or whether they were intended to be paid monthly as benefits were paid out to George, in the nature of alimony.

The legal considerations that remained unaddressed in the parties’ agreement were, at least, the following:

  • PERS takes the position that federal ERISA and Mississippi law do not allow division of PERS benefits by QDRO. The agreement should have provided that it would be divided by payment, unless George left PERS employment and withdrew his account, at which time it would be divided by specified percentages between them.  No mention should have been made of a QDRO vis a vis the PERS benefits. Also, whose responsibility it was to trigger the payment of benefits should have been specified in the agreement.
  • Final calculation of the PERS benefit is based on the highest four years of earnings. Since George was not a retirement age at the time of the divorce (he did not retire until 2011), the parties should have negotiated and included in their agreement how Annie’s 1/2 benefit would be calculated, taking into account the probability of George’s future pay increases.
  • PERS benefits can not be paid out in a lump sum unless the employee leaves PERS employment. As mentioned above, this obvious point should have been addressed in the parties’ agreement. In essence, these parties had no choice but to have Annie’s share paid out over time. That is what the chancellor in Pruitt v. Pruitt tried to do, but was reversed by the COA. The problem, based on Pruitt, seems easy to address in a rational way, but is in reality deceptively difficult to resolve.

Every one of the foregoing deficiencies came back to bite these parties in the proverbial nether regions. Annie brought a contempt action against George because he did not initiate a QDRO, and for her unpaid benefits. George countered that he owed nothing, since PERS could not be divided by QDRO. The chancellor calculated what she concluded was Annie’s portion, and ordered that Annie receive that from George’s retirement payments as paid, and she awarded Annie a judgment with modest interest for the benefits that he had received and not shared with Annie. She died not find George in contempt.

George appealed, raising all of the points above. The COA affirmed.

It would have saved everyone involved a lot of legal fees, costs, aggravation, anxiety, and time if only some more attention and effort had been put into the drafting of the PSA in the first place. Yes, it would have required more time for negotiation and drafting, but it would have settled the issue as early as 2011 without the need for further litigation. It’s called draftsmanship.

 

For Lawyers Reading this Blog

September 12, 2014 § 9 Comments

A few chancellors have told me that lawyers have been citing my blog posts as authority in their arguments. One judge told me (laughingly, thank goodness) that she had stated her understanding of the law, and the lawyer responded, “No, judge, that’s not right; Judge Primeaux says …”

Well, as flattering as that is, let me set things straight.

I am not the authority here. I am merely pointing you to the authority. And what I am posting is my opinion of the authority. You should read the case or statute or rule for yourself, understand how it fits your particular case, and cast your net out for any other authority you can find to help your case. Your opinion may vary from mine.

I am not a legal scholar like Professor Bell, nor is my blog a hornbook. It’s a starting place. A place where you can go to be reminded of something you might have forgotten, or to have something called to your attention that you didn’t know about. From that basic point it’s up to you to turn that into something of benefit to your practice.

My ruminations here are no substitute for the exercise of your own legal skills. Take what I have written and let it lead you in a productive direction, keeping in mind that it will take you only so far until your own legal ability and talent must kick in to formulate the best approach and presentation for your client.

Don’t cite me or my blog as the authority. Cite the authority.

For Laypeople Reading this Blog

September 11, 2014 § 4 Comments

I get comments and even emails from non-lawyers asking legal advice and even questioning the actions of lawyers and judges in cases. Lately there have been plenty. There are several reasons why I don’t respond.

First, and most importantly, MCA 9-1-25 specifically prohibits judges from practicing law. Giving legal advice is the practice of law. Ergo, I can’t do it.

Second, even if I could give legal advice, I would not do it via this vehicle. No lawyer who is competent would give legal advice based on a person’s recitation of facts without asking questions to fill in the gaps, to rule out alternative scenarios, and to test the accuracy of the scenario.

Third, the law is a nuanced thing, with many subtleties. Often there are multiple approaches to take, each with its own risks and advantages. Those variations should be teased out in a thoughtful conversation between attorney and client where the exchange of information and feedback results in a concensus on how to proceed. You can’t do that on a blog.

This blog is designed for lawyers and judges in the hope that it will improve the practice of law in Mississippi’s chancery courts. Lawyers and judges who read this blog know that the information is a mere starting point for research in a given case. It points a direction and suggests an approach.

There is no legitimate substitute for competent legal advice when one is confronted with a legal problem. And, quite often, what appears to be a simple matter can be fraught with unapparent implications that only a lawyer can spell out.

Laypersons are always welcome to read this blog, for what it is worth, but it is not a substitute for the services of a lawyer.

 

Trying to Tie the Chancellor’s Hands

September 10, 2014 § 6 Comments

Lawyers frequently try to add language to PSA’s and agreed judgments to the effect that some event shall constitute a material change in circumstances warranting modification. In essence, it is an attempt to take that issue away from the judge — to tie her hands.

In the case of Frazier v. Frazier, 136 So.3d 1068 (Miss. App. 2013), the parties had agreed to language in a PSA that, if Paul Frazier lost his job, that would constitute a material change in circumstances justifying modification of his obligation. Judge Fair addressed the issue for the court:

¶ 14. The parties did concur in their pleadings and in the transcripts of hearings, which were made part of the record, that the property settlement provided that Paul’s loss of his job would be a “material change in circumstances” justifying, apparently in their minds, a possible modification in his contempt-enforceable obligations for monthly child support. Generally, for a modification of either ordered or contractual child support to be appropriate, there must have been an “unanticipated” change in circumstances of the paying parent that results in inability to honor his obligations toward his children, particularly those obligations he has voluntarily contracted to pay. See Evans v. Evans, 994 So.2d 765, 770 (¶¶ 16–17) (Miss.2008). However, contracts that anticipatorily mandate the effect of material changes in circumstances have been held unconscionable and void by the courts. See Houck v. Ousterhout, 861 So.2d 1000, 1001–02 (¶ 8) (Miss.2003).

In Frazier, the chancellor did not rely on the agreement, but rather made his own independent finding that Paul’s unemployment was a material change in circumstances. That saved the trial court’s ruling from reversal.

You can include language such as that in Frazier in your agreements if you like, but you have to understand, and should so advise your client, that the language is void; not voidable, but void. meaning that it is unenforceable. The proscription has been held to apply not only to child support, but also to alimony and child custody. You simply can’t pre-decide those issue — it’s for the judge to decide.

Child Support Deviation for Daycare

September 9, 2014 § 1 Comment

MCA 43-19-103 is an intriguing statute. For those of you who every now and then look at the Mississippi Code, you will find much there that will assist you in advising your clients in child support cases, whether original or modification.

Section 103 sets out the so-called “deviation criteria” upon which a chancellor may rely in finding that application of the statutory child support guidelines in MCA 43-19-101 would be unjust or inappropriate.

In particular, I want to call to your attention that the Mississippi Legislature in 2012 amended the statute to add subsection (i), which reads as follows:

Payment by the obligee of child care expenses in order that the obligee may seek or retain employment, or because of the disability of the obligee.

This subsection allows the judge to find that the child care expenses for employment or occasioned by disability skew the payee’s expenses to the extent that a deviation upward from the guidelines is justified.

I don’t know about you, but when I practiced I saw many cases where the chancellor awarded strictly guideline child support, which was barely enough to pay the custodial parent’s daycare expenses so that she could work in a low-paying job. There was nothing left over to pay other expenses of the child, which fell on the mother to bear.

The most recent case in which a chancellor’s deviation based on daycare expenses was upheld is Marin v. Stewart, a COA case decided September 24, 2013, about which I previously posted here. My earlier post focused on the point that the chancellor is not required to address each and every deviation factor if she concludes that deviation is appropriate, but only those that apply in the case.

Before you launch off into your next child support case — whether you represent the payor or payee —  study Section 103 and see whether there is anything there that will help your case. As I have said many times here before: when you save your clients money, they love you; and when you cost your clients money, they hate you.

You Can Use Escalation Clauses Once Again

September 8, 2014 § Leave a comment

The landmark case of Tedford v. Dempsey, 437 So.2d 410 (Miss. 1983), is notable primarily as the case that firmly established the age of 21 as the ultimate age of emancipation in Mississippi.

Tedford is also the case that encouraged lawyers and judges to incorporate child support escalation clauses into their PSA’s and judgments. This is the specific language from the opinion:

In the child support provisions of their separation agreements, the parties generally ought to be required to include escalation clauses tied to the parents’ earnings or to the annual inflation rate or to some factored combination of the two. Though under the structure of the irreconcilable differences statute freedom of contract is exalted, there are limits. The statute requires that the chancellor find that “the parties have made adequate and sufficient provision by written agreement for the custody and maintenance of any children….” Tedford, at 419 (citing Miss.Code Ann. § 93–5–2 (Supp.1982). (emphasis added)).
That seems to me to be pretty clear. An escalation clause can be tied either (1) to the parents’ earnings, or (2) to the annual inflation rate, or (3) to some factored combination of the two.
As happens from time to time in Mississippi jurisprudence, however, subsequent cases dealing with escalation clauses morphed the “or” language in Tedford into a mandate that all of the factors must be addressed, with the result that most lawyers and judges gave up entirely trying to incorporate escalation clauses because it was practically impossible to draft one that could successfully pass appellate scrutiny. The key case requiring all of the factors to be taken into account was Bruce v. Bruce, 687 So.2d 1199, 1202 (Miss.1996).
The case of Short v. Short, decided by the MSSC on February 6, 2014, overruled Bruce and the line of cases that required all of the factors to be considered, and returned the law of escalation clauses to its status under Tedford. Justice Pierce’s opinion stated:
¶ 15. For clarity, we overrule Bruce’s interpretation that escalation clauses must be tied to all four factors. Id. We focus on the original language in Tedford providing that escalation clauses should be “… tied to the parents’ earnings or to the annual inflation rate or to some factored combination of the two.” Tedford, 437 So.2d at 419 (emphasis added). We affirm Wing in that the creation of escalation clauses should begin with a consideration of the inflation rate, the noncustodial parent’s increase or decrease in income, the child’s expenses, and the custodial parent’s separate income. Wing, 549 So.2d at 947. However, we are not mandating that escalation clauses be specifically tied to all four factors. Foremost, escalation clauses must adequately and sufficiently provide for the custody and maintenance of the child pursuant to Mississippi Code Section 93–5–2. Tedford, 437 So.2d at 419.
The MSSC reversed the COA’s earlier ruling in the case.
An interesting point in Short was that Mr. Short was seeking, in essence, to use his escalation clause as a de-escalation clause due to a loss in income. You can read the opinion yourself for its reversal of the chancellor’s refusal to grant a downward modification based on the paarticular language in these parties’ agreement. Escalation clauses are, based on Short, modifiable, with the caveat that courts take a dim view of modifying agreements that have previously been approved by a chancellor.
Before you include an escalation provision in your client’s case, carefully weigh its possible impact on the future obligations of your clieent, if you are representing the paying party. If you will study the agreement in Short, you can see, with the benefit of 20-20 hindsight, that perhaps not enough attention was given to the possibility that he might suffer a catastrophic drop in available funds to meet his contractual obligation.

“Quote Unquote”

September 5, 2014 § Leave a comment

“Knowledge is proud that he has learn’d so much; Wisdom is humble that he knows no more.”  —  William Cowper

“Wisdom does not show itself so much in precept as in life — in a firmness of mind and mastery of appetite. It teaches us to do, as well as to talk; and to make our actions and words all of a color.”  —  Seneca

“The question is, whether, like the Divine Child in the Temple, we are turning knowledge into wisdom, and whether, understanding more of the mysteries of life, we are feeling more of its sacred law; and whether, having left behind the priests and the scribes and the doctors and the fathers, we are about our Father’s business, and becoming wise to God.”  —  Frederick William Robertson

033

 

 

In Terrorem Now has an Exception

September 4, 2014 § 5 Comments

In terrorem clauses, as you will recall dimly from law school, are provisions in wills and trusts that prohibit any beneficiary who contests the instrument from taking anything through it, in effect creating a forfeiture. They are designed to be a potent deterrent to litigation among the beneficiaries.

Mississippi has long adhered to the rule that, unless a particular provision is contrary to law, a testator or settlor is allowed to make any provisions for disposition of his property that he sees fit to make, including in terrorem clauses.

Here is a specimen in terrorem clause from a will:

If any beneficiary hereunder (including, but not limited to, any beneficiary of a trust created herein) shall contest the probate or validity of this Will or any provision thereof, or shall institute or join in (except as a party defendant) any proceeding to contest the validity of this Will or to prevent any provision thereof from being carried out in accordance with its terms (regardless of whether or not such proceedings are instituted in good faith and with probable cause), then all benefits provided for such beneficiary are revoked and such benefits shall pass to the residuary beneficiaries of this Will. . . .

That language was the subject of litigation in the MSSC case of Parker v. Benoist, decided by the MSSC on August 28, 2014.

William Benoist had admitted the 2010 will of his father, B.D. Benoist, to probate. It included the in terrorem language set out above. William’s sister, Bronwyn, who was a co-fiduciary with William over some of their father’s assets, filed a will contest charging undue influence, and asking the court for an accounting, to void any benefits William received as a result of his undue influence, and for equitable relief.

Following a trial, the jury returned a verdict that, although there was evidence of a confidential relationship, there was no evidence of undue influence. The chancellor then ruled that the in terrorem clause was valid and enforceable, and that, as a result, Bronwyn took nothing under the will. Bronwyn appealed.

In a case of first impression, the MSSC reversed the chancellor’s enforcement of the in terrorem clause. This language is from ¶ 1:

In this appeal, we must determine whether Mississippi law should recognize a good faith and probable cause exception to a forfeiture in terrorem clause in a will. We hold that it should, and that Bronwyn has sufficiently shown that her suit was brought in good faith and was founded upon probable cause.

At ¶ 8, the court, in an opinion written by Justice Kitchens, said that “We hold that such a provision is unconstitutional under Mississippi’s Constitution, void as against public policy, and fundamentally inequitable, and we join the large number of jurisdictions who permit a good faith and probable cause exception to forfeiture clauses in wills.”

The opinion goes on to say that such clauses frustrate the fundamental purpose of courts, which is to detemine the truth and to decide whether or not a will is valid, contrary to the Mississippi Constitution’s guarantee of the right of access to the courts. Although forfeiture provisions may serve the useful purpose of discouraging and punishing persons from seeking unjustified enrichment and corecive settlements, they go too far when they deprive the court of its duty to determine the validity of a donative transfer. The solution is to allow a good faith and probable cause exception. This is what the court said at ¶ 14:

… The will of the testator should control, but courts exist to determine whether the testator’s will is a valid reflection of the testator’s wishes. Black’s Law Dictionary defines “probate” as a “[c]ourt procedure by which a will is proved to be valid or invalid. . . .” Black’s Law Dictionary 1081 (5th ed. 1979). By definition, probating a will is proving that it is valid. This must occur through litigation. A strict interpretation of no-contest provisions in wills would hamper courts’ goal of determining what is, once and for all, the will of the testator. A bona fide inquiry into the validity of the will should not be defeated by language contained in the will itself.  We hold that, in Mississippi, forfeiture provisions in wills are enforceable unless a contest is brought in good faith and based on probable cause. “Probable cause exists when, at the time of instituting the proceeding, there was evidence that would lead a reasonable person, properly informed and advised, to conclude that there was a substantial likelihood that the challenge would be successful.” Restatement (Third) of Property: Wills and Other Donative Transfers at § 8.5 cmt. c. The determination of good faith and probable cause should be inferred from the totality of the circumstances. [Emphasis added] 

The bottom line in this case is that, although in terrorem clauses can still be used in wills and trusts, they may now be overcome and adjudged unenforceable if subjected to challenges found to be made in good faith and based on probable cause. And the right to have a court scrutinize the validity of the will can not be thwarted by the language of the will. These are important points of law on which to advise your clients when drafting donative instruments.

In this case, the court found that Bronwyn did have probable cause because: she understood her parents’ previous intentions from prior wills and discussions she had had with them; the 2010 will was unknown to her and contradicted her prior understanding; her father had been in failing health complicated by alcoholism and use of pain killers around the wtime he executed the 2010 will; he was taking medication for cognition problems; large withdrawals were made from his accounts that went directly to William; and he conveyed large tracts of real estate to William around the time of making the 2010 will. The 2010 circumstances occurred while B.D. was in William’s care. There was no evidence of bad faith on Bronwyn’s part in bringing her suit.

By the way, I got a thrill out of ¶ 12 of the court’s opinion, where Justice Kitchens invokes maxims of equity and actually quotes from Griffith’s Mississippi Chancery Practice.

There are some other interesting aspects to this case, including: the award of attorney’s fees from the estate to defend the will; the denial of an award of attorney’s fees against Bronwyn; and whether William should have been disqualified and removed as executor. Each of those deserves its own, separate post. Until then, you can read the court’s opinion for yourself.

The Value of Your Professional Reputation

September 3, 2014 § 3 Comments

Not too long ago, I posted here about the value of your reputation with the court. It’s a subject that can not be overemphasized.

Yesterday, Philip Thomas added an eloquent post on topic: Mississippi Judges Stress the Importance of Professional Reputation.

It’s not only important reading for young (or “Baby” in Mr. Thomas’s parlance) lawyers, but also for more experienced, jaded lawyers who might have begun letting the concept slip from their grasp. 

 

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