July 18, 2016 § 1 Comment
In the hilarious comedy, Duck Soup, Groucho Marx is caught by his lady-friend in flagrante delicto with another woman. When she accuses him of the obvious, he retorts, “Who you gonna believe, me or your lyin’ eyes?”
That popped into my head when I read the COA’s decision in Stuckey, Conservator of Waid v. Waid, decided June 28, 2016. Stuckey, who was special conservator of Lila Waid, an end-stage Altzheimer’s victim, became convinced that Lila’s husband Herman Waid was having an affair with an old flame. At the time of trial, Herman was 84 years old and was suffering from Parkinson’s Disease. The plaintiff presented proof that Herman and his lady-friend, JK, were seen lying together in Herman’s hospital bed, and they spent time together at each other’s homes, often in the bedroom. They were seen being affectionate toward one another. In defense, they denied any sexual relations. Herman contended that he was impotent, and suffered from erectile dysfunction. JK stated that she wished that the relationship were more than friendship.
The chancellor issued a 12-page opinion denying the divorce, and Lila appealed. The COA affirmed. What I want to call to your attention is how it is up to the judge to choose who to believe, and how much weight to give to the evidence presented. Here is how Judge Fair, for the court, stated it:
¶16. We find there was substantial evidence to support the chancellor’s finding. Herman and J.K. both testified that their relationship was not romantic. They admitted to staying together overnight, but there was no evidence of a sexual relationship. See Atkinson [v. Atkinson], 11 So. 3d at 176-77 (¶19) [(Miss. App. 2009)](finding that cohabitation does not prove adultery by clear and convincing evidence). None of the conduct described in the eyewitness testimony meets the definition of adultery. See Owen [v. Gerity], 422 So. 2d at 287 [(Miss. 1982)]. Further, the chancellor was presented with uncontradicted evidence of Herman’s impotence, which would make it impossible for him to satisfy any inclination.
¶17. As the judge of credibility, the chancellor is entitled to choose between reasonable interpretations of the evidence and the inferences that may be drawn therefrom. Bowen v. Bowen, 982 So. 2d 385, 395 (¶42) (Miss. 2008). The evidence of record is facially sufficient to support a finding of adultery, as stated in the dissent. But the evidence is, likewise, facially sufficient to support a finding that adultery did not take place. The trier of fact is not this court but the chancellor, who heard the testimony of the witnesses, determined their credibility, weighed that and other evidence, and made a decision within her discretion. After viewing the record, we are therefore satisfied that the chancellor did not abuse that discretion, was not manifestly wrong, was not clearly erroneous, and applied the proper legal standard in making her decision. We thus affirm.
Nothing really earth-shaking there, but it’s a good reminder that the chancellor has broad power to choose whom to believe and how much weight to assign to the evidence. As long as the chancellor’s decision is supported by substantial evidence and applies a proper legal standard, the result will be an affirmance on appeal. That is even true, as in this case, where there was substantial evidence to support an opposite result.
June 22, 2016 § Leave a comment
When Denise and Andrew Von Herrmann were divorced in 2012, their agreement incorporated into the divorce judgment included the following language:
“Wife shall pay husband periodic alimony as follows: On or before the 15th day of each month beginning August 15, 2012, $1,450 per month through March 16, 2016. Beginning April 15, 2016, and continuing through September 15, 2022, wife’s periodic alimony to husband shall be reduced to $500 per month, with the final periodic payment of $500 due on September 15, 2022. All alimony payments shall otherwise cease 1) upon the demise of the wife or husband or 2) upon husband’s remarriage or commencement of regular cohabitation with another woman.”
Denise filed a petition to modify in 2013, claiming a reduction in income from $180,000 to $85,000 a year. Denise had remarried or had her name restored to Runge at the time she filed.
Following a trial, the chancellor ruled that the payments were unmodifiable lump-sum alimony “due to the fixed amount and the definitive ending date. Denise appealed.
In the case of Runge v. Herrmann, decided May 31, 2016, the COA reversed. Judge Irving, for the court, analyzed the case law that goes in both directions on how to construe “hybrid alimony” provisions such as this. Instead of relying on those decisions, though, the court applied contract construction principles and concluded that it was the intent of the parties was that the payments were to supplement Andrew’s income and, therefore, they were in the nature of alimony, and not property division; thus, it was error for the chancellor to conclude that they were lump-sum alimony, which is a property-division tool. The case was remanded for further proceedings consistent with the opinion.
- Ever since the MSSC began permitting so-called “hybrid alimony” that mixed and matched various features of the three major genres of alimony (i.e., periodic, periodic rehabilitative, and lump-sum), the cases are quite fact-specific. It is hard to draw any hard and fast conclusions about what language to use to protect your client’s interests.
- As both sides argued here, the label you smack on the alimony arrangement you draft will not necessarily be controlling. Rather, the court must look to the substance of the parties’ agreement.
- In this case, it might have helped if it had been specifically stated in the agreement that the parties agreed that the arrangement was to supplement income, and was specifically not intended to be any form of property division or lump-sum alimony.
- Mention of the tax treatment in the agreement would probably have been dispositive. True alimony is taxable income to the recipient and deductible by the payer, unless some other agreed tax treatment is expressly stated. Lump-sum alimony, which is property division and not really alimony, is neither taxable nor deductible.
- As I have said here before, I really wish the MSSC would do away with the term “lump-sum alimony” as it applies to property division. Its original meaning, ‘way back in 1856 when it was concocted by the court, was to allow payment of the entire amount of alimony that would be payable under the decree to be paid in one, or several payments. (That was back before there was an IRS that frowned on front-loading). Over time, the court expanded the meaning to include payments to equalize the parties’ estates in divorce. That fiction was necessary at the time to get around the principle that title controlled, and the court could not divide separately-titled property, but it could award “alimony.” The necessity for that fiction, however, went away with Ferguson and its progeny. Post-Ferguson, we understand that an equalizing payment may be necessary to divide the equities in divorce, regardless of title. So why don’t we call it an “equalizing payment” or something similar, and limit use of the term “alimony” to payments intended to replace or supplement income?
June 13, 2016 § Leave a comment
When Lori and Gary Mosher appeared for the divorce trial to end their 26-year marriage, they agreed to a divorce on the ground of irreconcilable differences, and submitted several contested issues for adjudication by the court.
The parties agreed that Lori would receive “one-half of [Gary’s] military retirement,” but left it to the court, apparently, to decide the amount. The chancellor found that Gary’s “military retirement” consisted of two components: “his disposable retired pay”; and his VA disability retirement of around $400 a month. Half of the two components came to $1,795, after deduction for a survivor annuity. Since the VA benefit was not subject to division under federal law, the chancellor awarded Lori a greater share of the retirement.
Gary appealed, complaining that the chancellor had no authority to divide the VA benefits because their agreement was to divide the military retirement only.
The COA affirmed on the point in Mosher v. Mosher, handed down May 24, 2016. Judge Fair wrote for the majority:
¶8. This argument misses the mark. Although it is true that the parties here agreed to divide the “military retirement” equally, the property settlement agreement did not specify what that was. Property settlement agreements are contracts, and like all contracts, there are sometimes disputes regarding the meaning of their terms. Gaiennie v. McMillin, 138 So. 3d 131, 135 (¶8) (Miss. 2014). It is apparent that the chancery court interpreted the parties’ agreement rather than disregarding it as Gary contends. The chancellor dedicated nearly ten of the fifty-six pages of her written judgment to this question.
¶9. As to the interpretation of the agreement, while it is clear Gary does not agree with the chancellor’s decision, he has not briefed that issue. “[T]here is a presumption that the judgment of the trial court is correct and the burden is on the Appellant to demonstrate some reversible error to [the appellate court].” Birkhead v. State, 57 So. 3d 1223, 1231 (¶28) (Miss. 2011); see also M.R.A.P. 28(a)(6). Gary has failed to meet his burden of showing error on this issue.
There are other issues addressed in the opinion dealing with equitable distribution and alimony. Judge Carlton dissented in part, joined by Greenlee and Griffis.
The main takeaways here for practitioners:
- What you say and how you say it are pretty dadgum important when it comes to court. If the parties intended that only the military retirement, not including the VA disability retirement, was to be divided, then the agreement should have stated exactly that. Precision makes all the difference. It’s pretty hard to argue that something was intended when that intent does not appear in the specific language.
- If you do not cite authority for your position on appeal, you have effectively waived it.
May 24, 2016 § Leave a comment
When Karen and Rickey Chance got an ID divorce in 2003, the parties’ PSA provided that Karen would get ownership of a home in Ocean Springs. Rickey was to be responsible to obtain a 30-year mortgage on the property, and to pay the mortgage debt and one-half of the ad valorem taxes for 96 months. Karen was responsible to pay her one-half of the ad valorem taxes, the hazard insurance, and to pay all taxes, insurance, and mortgage debt payments after Rickey’s obligation expired. Rickey also was to pay Karen alimony.
In 2004, Rickey got the mortgage, and the closing attorney suggested in a letter that Rickey simply reduce his alimony payments by the amount of Karen’s monthly obligation, but neither party acted on the recommendation.
To make a long story somewhat shorter, Karen never paid either her half of the taxes or the hazard insurance between 2003 and 2013. In 2013, Karen did send Rickey nearly $4,500 to pay her share of the 2013 expenses.
In the 10-year interim between 2003 and 2013, the parties talked about the situation. Karen steadfastly maintained that she did not have the financial ability to carry out her end of the deal.
In 2013, Rickey filed a petition for contempt against Karen, who responded with several defenses, most notably that of inability to pay. After a hearing the chancellor awarded Rickey a judgment for $38,584.90, and attorney’s fees. Karen appealed.
In the case of Chance v. Chance, decided May 10, 2016, the COA affirmed. You can read the opinion for yourself to see how the court dealt with Karen’s claims of laches, inability to pay, and error in award of attorney’s fees.
I want to focus on the agreement itself:
- I have seen several PSA’s lately in which one party agrees to refinance the home within some stated period of time. In every case, when I asked the lawyer whether the obligated party had the ability to do it, the answer was a shrug with a whimsical smile and “that’s what they agreed to do.” Yes, but if it’s your client who is on the hook, have you discussed whether he or she has the ability to do it? And if it’s the other party who has the duty, what impact will it have on your client if he or she proves incapable of doing as promised? Have you explored these things?
- One critical reason why this is so important to your client’s interest is that the property-division portions of a PSA are unmodifiable. East v. East, 493 So.2d 927, 931 (Miss. 1986). Your client does not get a do-over on the “oops” principle.
- Another important factor is that attempting to prove inability to pay is rarely successful. The burden is heavy, as I have pointed out here before.
- To avoid these swivet-inducing situations, build some alternatives into the agreement. If, say, your client ever can not pay her share of the taxes or insurance, the home could be listed for sale, the other party may reduce alimony and pay the taxes and insurance himself until sold, and he will be reimbursed from the proceeds. That’s one example; I am sure your creative legal genius can conjure up many others.
- Remember that if all you do is take your client’s notes and convert them into a legal-looking sheaf of papers, you are nothing more than a clerk-typist; you are misleading the public and fooling yourself if that’s what you do and you call yourself a lawyer.
April 11, 2016 § Leave a comment
Dee Myrick filed a Complaint for Divorce against her husband, John, in 2013. The complaint was based on the fault ground HCIT. At a temporary hearing, the chancellor ordered John to pay temporary alimony.
Later, the parties withdrew fault allegations and entered into a consent for divorce on the ground of irreconcilable differences. The contested issues submitted for adjudication were: “property division including allocation of debt”; attorney’s fees; and “division of all real property.” Alimony was not mentioned.
Following a trial and rehearing motions, the chancellor divided the marital estate and awarded Dee $600 a month in periodic alimony. John appealed the award of alimony.
In Myrick v. Myrick, decided February 23, 2016, the COA reversed on the issue of alimony and remanded. Judge Barnes wrote for the court:
¶17. Mississippi statutory law specifically lays out the procedure for a divorce on the ground of irreconcilable differences. Parties may consent to the divorce and submit to the trial court any unresolved issues:
If the parties are unable to agree upon adequate and sufficient provisions for the custody and maintenance of any children of that marriage or any property rights between them, they may consent to a divorce on the ground of irreconcilable differences and permit the court to decide the issues upon which they cannot agree. Such consent must be in writing, signed by both parties personally, must state that the parties voluntarily consent to permit the court to decide such issues, which shall be specifically set forth in such consent, and that the parties understand that the decision of the court shall be a binding and lawful judgment.
Miss. Code Ann. § 93-5-2(3) (Rev. 2013) (emphasis added). “Divorce in Mississippi is a creature of statute,” and the parties must strictly adhere to the statutory mandates of irreconcilable-differences divorce. Engel v. Engel, 920 So. 2d 505, 510 (¶17) (Miss. Ct.App. 2006) (quoting Massingill v. Massingill, 594 So. 2d 1173, 1175 (Miss. 1992)). “The language of [s]ection 93-5-2(3) is clear. A chancellor may decide contested issues in a divorce based upon irreconcilable differences. However, he is limited to the resolution of those issues specifically identified and personally agreed to in writing by the parties.” Wideman v. Wideman, 909 So. 2d 140, 146 (¶22) (Miss. Ct. App. 2005).
¶18. Dee initially petitioned the court for a divorce on the basis of habitual cruel and inhuman treatment, uncondoned adultery, or, in the alternative, irreconcilable differences. She requested “temporary relief” of a “reasonable sum” for monthly alimony. In November 2013, the chancellor issued a temporary order, ordering Ken to “contribute” $800 a month to Dee in lieu of the house payment.
¶19. In February 2014, Dee and Ken signed a consent agreement to an irreconcilable differences divorce. It listed matters the chancellor should decide as “property division, including allocation of debt”; attorney’s fees; and “division of all real property.” No mention was made of alimony. The chancellor granted Dee and Ken’s motion to dismiss fault grounds. The chancellor had, however, ordered the temporary relief of alimony when the divorce sought was based on fault grounds, rather than irreconcilable differences.
¶20. In Engel, this Court reversed the chancery court’s judgment in an irreconcilable differences-divorce case because the consent failed to comply with required statutory language, and the parties failed to set forth with specificity the issues to be decided by the court, even though the appellant suffered no prejudice. Engel, 920 So. 2d at 509 (¶¶14, 16). Here, the parties did not specify alimony as an issue to be decided by the chancellor; so he cannot now award it.
¶21. Ken cites to Wideman, 909 So. 2d 140, and Gordon v. Gordon, 126 So. 3d 922 (Miss. Ct. App. 2013), for support. In Wideman, this Court affirmed a chancellor’s refusal to consider an award of attorney’s fees in a divorce action where the parties did not include this issue in their consent agreement. Wideman, 909 So. 2d at 145-46 (¶22). Likewise, in Gordon, this Court affirmed the chancellor’s refusal to hear issues of child custody, support, and equitable distribution because the parties stated in their consent agreement the only issue the chancellor had to resolve was related to misappropriation of funds. Gordon, 126 So. 3d at 926 (¶12).
¶22. Dee argues, and the separate opinion agrees, that alimony is an integral part of “property division” analysis, and is therefore proper here, citing the Ferguson factor regarding “the extent to which distribution can eliminate future periodic payments.” Ferguson, 639 So. 2d at 925. However, in an irreconcilable-differences divorce, the statute is clear that the resolution of all issues must be specifically set forth in the consent agreement. The court’s award of periodic alimony was without authority and must be reversed.
The court remanded rather than render for Ken because the chancellor had originally ordered Ken to pay Dee lump-sum alimony “based on need.” The COA instructed that, on remand, the chancellor was to clarify whether the lump-sum alimony was part of property division, which could be reinstated, or was alimony, which could not.
It makes perfect sense that, if something is left out of a negotiated agreement such as a consent, it should be assumed that its omission came about as a result of negotiation. The statute requires that all contested issues be clearly set forth. If you leave something out, unless the other side agrees to let it in, you won’t be able to get it in.
March 29, 2016 § Leave a comment
Ken and Lauren Moreland agreed in their irreconcilable divorce to the following provisions:
Kenneth Moreland shall pay one-half (1/2) of all expenses of the minor child for up to two (2) extracurricular activities and the reasonable age appropriate activities of the minor child which the parties agree are reasonable and necessary for the minor child.
The parties shall be responsible for one-half (1/2) of all preschool and/or private school tuition and expenses for the minor child attending preschool and/or private school, until graduation, including but not limited to registration fees, school uniforms, school supplies, lunches and any other expenses due to the school or as a result of the minor child attending school if the parties agree to enroll [the child] in a private preschool or school. [Emphasis added]
In Moreland v. Spears, handed down March 1, 2016, the COA held (at ¶11) that the italicized language required the agreement of both parties before Ken became obligated under the divorce contract to pay any part of those expenses. Since Ken never agreed, he was not bound to pay.
The very purpose of a contract is to create an agreement that is enforceable in a court of law. It’s a basic principle of contract law that a mere agreement to agree is no contract. See, e.g., Intrepid, Inc. v. Bennett, 176 So.3d 775 (Miss. 2015).
I have seen many PSA’s with similar provisions, and I always ask from the bench whether the party understands that there is no obligation if the other party does not agree. Most of the time the cheery, optimistic answer is that no problem is expected, and that, surely, the other party will “do the right thing.” To that, I always warn that if (s)he does not, no court can make him or her do the right thing under the terms of this agreement. Occasionally, the party will ask to go back to the drawing board. That’s the wiser course.
If you’re going to include Moreland-like language in a PSA, be sure to advise your client of the pitfalls. Better still: put it in writing and have your client acknowledge receipt by signing it.
January 11, 2016 § Leave a comment
What do you do when the divorce trial is concluded, the final judgment has been entered, and the post-trial motions have been disposed of? If there’s not going to be an appeal, you just make sure your bill is paid, shake your client’s hand, usher him to the door, wish him luck, say farewell, and shut the door behind him, right?
Well, not exactly.
Do you know whether your client still has his ex-wife named in his will? What about as beneficiary of his life insurance, or survivor on his IRA or 401(k)? Does he still have his ex as POD or survivor on any checking or securities accounts?
I read an article written by a financial advisor recently in which she related an encounter with a newly-married couple, both of whom had been divorced several years before. Both husband and wife had wills that still named ex-spouses as beneficiaries, and the same with life insurance and retirement accounts. When she asked them why they had not been changed, both replied that no one had advised them that they should.
A case in my court recently brought up a similar problem. The wife in the divorce case insisted that she owned the marital residence because the PSA in her 2007 divorce (more than 8 years ago) provided that her ex would execute a special warranty deed conveying his interest to her. Only problem: he never did. So, since May of 2007 she has remained a joint tenant with right of survivorship with that man. If she had died before he tended to that little bit of finish-work, her estate would have to pay another lawyer to do what her divorce lawyer should have done in the first place, and it probably would have involved courtroom billable hours.
Years ago, a man hired me to obtain a QDRO to divide his 401(k) account. He had represented himself in the divorce that took place nearly ten years before. When the divorce was final, he had asked the lawyer who represented his wife how to go about getting the retirement account divided. The lawyer pointed out that he did not represent him, and virtually slammed the door in his face. When the client at last decided to get remarried, he thought that it was time to get the matter tended to, so he hired me. Here is how the PSA read:
The parties agree that wife shall receive the sum of $60,000 from Husband’s 401(k) account.
That was all it said. [For a post on what that 401(k) language should have included, click here]
So we filed a petition for the court to enter a QDRO for her to receive exactly that — $60,000. After being served with process, she went back to her divorce lawyer, who called me and pounded the table, insisting that she was entitled to ten years’ worth of interest. I pointed out that the agreement he had drafted did not have a time frame for payment, that neither party was obligated by the agreement to prepare a QDRO, that there was no interest provision, and that the only definite thing about it was the amount. He called me back a few days later and said his client was willing to settle for the $60,000, and they signed the QDRO, which was entered and the matter finalized. For ten years my client earned money using his ex’s money. Had her lawyer acted in her best interest, he would have gotten that QDRO entered immediately after the divorce judgment.
You might well ask, as I did when my client first hired me, why was his ex not screaming for her money? Well, in the ten years after the divorce she asked him about once a year if he still had her money. She was satisfied with his answers, but apparently no one ever advised her what she was losing by not getting that QDRO entered.
You might also inquire whether my client was unjustly enriched. I would agree that he was, indeed, enriched, but not unjustly so. He did not sleep on his rights. He did not draft the agreement. It was not his obligation to calculate her separate interest. She was wise to want to settle for the principal sim, because if she had wanted to obtain a court ruling that he had been unjustly enriched, and directing him to disgorge any interest received on her money, she would have had to pay the attorney to pursue it, and likely would have had to pay a CPA to calculate the interest and testify as an expert. After paying those folks, she would be lucky if she got to walk away with the $60,000.
Another nightmare scenario involves credit cards. I represented a man in a routine irreconcilable differences divorce. The PSA provided that each would pay the debts in his or her own name, as well as debts incurred in the name of or against the credit of the other. Thank goodness for that specific language, because he came in a year or so later with a letter from a credit card company reporting that an account in joint ownership was in default and making demand on him to pay more than $10,000. Turns out that shortly before the separation his wife had opened one of those accounts the company had solicited by mail, signing her husband’s name, and kept the account concealed from him. Then, after the divorce, she used it to supplement her income. We notified her that she had so many days to pay the account in full or we would sue. She borrowed money from her family, paid it off, and the account was closed. My client’s credit rating took a hit, but that and a modest legal fee were his total damages.
Lesson learned: it might not be a bad idea in the course of a divorce case to have your client run a credit check.
All of this boils down to a simple professional consideration that I have mentioned many times here: When the case is concluded, your client wants to be finally done with it, and she does not want to have to pay another attorney to clean up after you.
Actually, many of these things can be tended to before the divorce is concluded. That deed can be prepared, joint accounts closed, wills changed, bills of sale signed, agreed QDRO signed by the parties, and so on, with the originals held in the lawyer’s file until the judgment is entered.
When you are through with the divorce, help your client through the aftermath. Make sure she revokes all wills naming the ex as a beneficiary. Make sure there are no financial assets not covered by the divorce judgment that are joint, or have survivorship provisions. Make sure that there are no outstanding joint debts not addressed in the divorce. If a QDRO or deed is required for your client’s benefit, get it done ASAP. People are dying every day. You don’t want one of them to be the person you need to finish up your work.
January 4, 2016 § 1 Comment
Lee and Leslie Voulters were divorced from each other in 2004 on the sole ground of irreconcilable differences. The divorce judgment incorporated their PSA, which provided that Lee would pay Leslie lump-sum alimony in the sum of $1.08 million at the rate of $10,000 a month until paid in full. He also agreed to maintain a policy of life insurance on his life with a benefit of $1.08 million, with Leslie as beneficiary.
When Leslie filed a contempt action in 2013 charging Lee with missing some lump-sum payments and with failing to provide proof of life insurance, Lee counterclaimed, asking the court to interpret the PSA that the purpose of the life insurance was to protect Lee’s payment of lump-sum alimony, and that the obligation would terminate when the lump-sum alimony was paid in full.
Spoiler alert: There is no provision in the PSA that links the life insurance requirement to the lump-sum-alimony requirement.
Here are the pertinent parts of the agreement:
LUMP SUM ALIMONY/SPOUSAL SUPPORT
Lee shall pay spousal support to Leslie, in the form of lump sum alimony, the total sum of $1,080,000.00, payable in monthly installments of $10,000.00 each for a period of nine years. Such payments for support shall be due and payable by automatic bank transfer from Lee’s checking or other account directly into Leslie’s checking account, commencing on the fifth day of April, 2004, and shall so continue for one hundred and seven consecutive months thereafter. Lee’s obligation to pay such support to Leslie shall be fully vested upon the entry of a Final Judgment of Divorce in this cause, and shall not be modifiable. Lee’s obligation to pay such support shall not terminate upon Leslie’s death or remarriage, nor shall it terminate upon Lee’s death. However, despite the conventional definition of lump sum alimony[,] . . . these payments by Lee to Leslie under this Agreement shall be taxable to Leslie, and deductible by Lee, for state and federal income tax purposes.
Lee agrees to maintain life insurance on his own life in an amount not less than one million, eighty thousand dollars ($1,080,000.00), naming Leslie as primary beneficiary thereon. Proof of such insurance coverage shall be furnished to Leslie within fifteen (15) days following the date of execution of this Agreement. Furthermore, Lee shall direct his insurance carrier to provide coverage information to Leslie at least twice a year if requested by Leslie.
. . . .
EFFECT OF AGREEMENT
. . . .
The respective rights and obligations of the parties hereunder are deemed independent and may be enforced independently irrespective of any of the other rights and obligations set forth herein. This Agreement contains the entire understanding of the parties, who hereby acknowledge that there have been and are no representations, warranties, covenants, or understandings other than those expressly set forth herein.
RELEASE AND WAIVER
Subject to the provisions of this Agreement, each party has released and forever discharged . . . his or her heirs, legal representatives, Executors, Administrators, and assigns . . . from all causes of action, claims, right or demands . . . in law or in equity . . . except . . . causes of action for divorce or separation action now pending . . . . Each party releases, waives, and relinquishes any and all rights . . . to share in the estate of the other party upon the latter’s death . . . . (Emphasis added.)
Both parties offered testimony about their intent in negotiating the language into the agreement. Lee argued that the agreement was ambiguous because it had no termination date. Leslie argued that she negotiated it for support, which she needed because her estate was meager in comparison to Lee’s.
One question before I tell you how the chancellor ruled: do you see anywhere in that language quoted above any link between the life insurance obligation and the lump-sum alimony?
The chancellor ruled that the agreement was unambiguous, and that it did require Lee to maintain the life insurance regardless of the status of the lump-sum payments. Lee appealed.
On December 8, 2015, the COA affirmed in Voulters v. Voulters. The opinion by Judge Barnes includes a nice recitation of the law of contract interpretation, life insurance and insurable interests, and even attorneys fees in contempt actions and on appeal. I definitely commend it to your reading.
What I want to focus on here is this: If you want your agreement to mean a particular thing, then make sure there is language in it that says that particular thing. Remember that when the judge is called on to interpret a contract, she is bound by the language within the four corners of the document, and she may not accept parol evidence to vary or “explain what the parties meant” by those terms unless she first finds the agreement to be ambiguous. Just because Lee did not include a termination date for his life insurance obligation, that did not render the agreement ambiguous. It rendered instead the meaning that it had no termination date. In other words, it meant exactly what it did and did not say.
Be careful in your draftsmanship. Take time to make sure it says exactly what your client needs it to say. I think I was saved a hundred times or more by the simple practice of drafting the agreement and setting it aside for at least a day. I would then pick it up and read it afresh, often catching something that could be read two ways, or was simply not clear enough to do the job. Sometimes I would imagine myself to be another person altogether, looking at it as an outside observer. Anything to get an objective perspective.
Remember that some day someone entirely unconnected with the negotiations and the emotion of the divorce case is going to be reading your work with absolutely none of the knowledge that you had when you drafted it. It may be a judge, or it may be another lawyer having to represent your client, or — heaven forbid — a lawyer looking for a cause of action against you. That’s why it’s critical when you draft an agreement to give some thought and care to the words, phrases, and language construction that you use. That’s what your client is paying you for: to have absolutely no more trouble out of this matter after the final judgment is entered.
December 14, 2015 § Leave a comment
In equitable distribution, one of the factors the court is required to consider is “Substantial contribution to the accumulation of the property … ” by … “Direct or indirect economic contribution …” Ferguson vs. Ferguson, 639 So.2d 921, 928-9 (Miss. 1994).
Over the years since Ferguson the courts have recognized that a homemaker’s contribution is to be recognized as an indirect contribution. In doing that, I think most of us have accepted a modicum of evidence on the point to support a finding. But is that enough?
In the divorce trial between Rodney and Courtney Williams the chancellor made this finding that:
“the wife was the homemaker of the parties[ and] that the husband earned the majority of the financial income. This is reflected by the domestic services rendered by [the wife] shown during the periods of time in which the grandchildren lived in the home, and she, as well as the husband, took care of them. I find that both have contributed equally toward the acquisition of property[—]he directly financial and she through domestic and in-kind services. Accordingly, I find that both are entitled to an equal distribution of those properties.”
To be honest, I think most chancellors make similar findings and conclusions. On appeal, Rodney took issue with the chancellor’s statements, arguing that Courtney had made only meager contributions.
In the case of Williams v. Williams, handed down November 17, 2015, the COA found that the chancellor’s findings were not supported by substantial evidence on homemaker services, and remanded for further proceedings. Judge Irving wrote for the majority:
¶35. In Lowrey v. Lowrey, 25 So. 3d 274, 287 (¶31) (Miss. 2009) (citation omitted), the Mississippi Supreme Court explained:
[T]he concept of homemaker services rests on a showing that the homemaker has contributed to the economic well-being of the family unit through the performance of the myriad of household and child-rearing tasks. In valuing this service[,] consideration should be given to the quality of the services. For example, a homemaker who, over the course of the marriage, has been frugal in the handling of homemaker expenditures and has thereby enhanced the family assets is entitled to a more equitable return than one who has been extravagant.
¶36. In this case, the record does not establish the extent of Courtney’s contribution toward the acquisition of the marital property. It appears that the chancellor mistakenly thought Courtney was a stay-home spouse and grandmother. As noted, Courtney worked during the course of the marriage, working eleven of the twelve years of marriage at one place, where her net income was approximately $1,600 per month. The record does not inform us where Courtney worked during the first year of the marriage or how much she earned during that year. The parties had no children together, and there is no testimony in the record regarding the division of the household duties. Although Courtney took care of the grandchildren in the home for some period of time, we note that the grandchildren were her grandchildren, but not Rodney’s grandchildren. It appears that the chancellor placed some weight on this fact in determining that Courtney was a homemaker and that her grandchild-caring duties contributed to the acquisition of the marital estate. The record reflects that Rodney paid the majority of the household expenses and the entire mortgage note on the marital home. It further reflects that Courtney deposited only $250 biweekly in a joint bank account to help with the household expenses but routinely withdrew money from that account for other purposes unrelated to household expenses. And the record is silent as to any other financial contributions that Courtney may have made during the marriage. Therefore, there is not substantial evidence in the record supporting the chancellor’s finding that the parties “both have contributed equally toward the acquisition of property[—]he directly financial and she through domestic and in-kind services.”
A few takeaways:
- The chancellor here believed that Courtney’s contribution to the household should have been recognized, but there was simply not enough evidence to support his conclusion. Unless you really want your case to be reversed and remanded, it’s up to you to develop the evidence on the record that will support the judge’s findings. Here, the chancellor could just as easily have found against Courtney on the factor, which could have adversely impacted her equitable distribution. Read Lowrey and take it to heart. Use it as a template in your next equitable distribution case.
- If you represent the homemaker and your case is weak on this factor, make sure you bulk up your proof on the other factors, and try to convince the judge that this is not the key factor to consider in making a division. Remember that all of the factors do not have equal weight; the weight to be accorded to each varies from case to case, depending on the facts.
- The converse is true if you represent the direct contributor. Emphasize the direct contribution in terms of its role in the acquisition and appreciation in value of the marital estate.
- Never assume that the judge’s findings will make up for gaps in your case. If the judge stretches to make an assumption, you could find the case ricocheting back to you because those findings are not supported by substantial evidence. Client’s don’t like having to pay for a do-over.
November 23, 2015 § Leave a comment
Back in April of last year I pondered the COA’s decision in Burnham v. Burnham, which affirmed the chancellor’s rulings on child support and equitable distribution in a divorce, but subjected his findings to “heightened scrutiny” and “less deference” because he adopted one side’s proposed findings of fact and conclusions of law verbatim. That post is here.
Dissatisfied with the COA’s affirmance, Matthew Burnham filed a petition for cert, which the MSSC granted. One issue he raised was the chancellor’s verbatim adoption of the other side’s proposed findings of fact and conclusions of law.
In ¶7 of the MSSC’s opinion in Burnham v. Burnham, handed down November 12, 2015, Justice Dickinson stated:
In Bluewater Logistics, LLC v. Williford, we abandoned the rule that a chancellor’s decision to adopt a party’s proposed findings of fact was subject to “heightened scrutiny.” A chancellor’s factual findings , even those adopted from a party, are reviewed for an abuse of discretion. [footnotes omitted]
So that would seem to be the last word on that subject.
This case does, however, highlight a pitfall of proposed findings. The MSSC reversed because several of the chancellor’s findings of fact, particularly those upon which he based a finding of dissipation of assets, were unsupported by evidence in the record. Those findings of fact were submitted to the chancellor by the attorneys for Mrs. Burnham. Although the chancellor had the duty to satisfy himself that the proposed findings he adopted were accurate and supported in the record, the first duty was on her attorneys to ensure that their proposed findings were accurate. As the outcome of this case illustrates, if you play loose with the facts, it can cost your client down the road.
Chancellors have different approaches to proposed findings. Some ask for them in many cases, particularly complicated ones. Others have told me that they do not like them because lawyers tilt them in favor of their clients. Still others, as I do, call for them selectively.
If you’re going to offer proposed findings, make sure you draft them like the judge is supposed to — relying only on facts in evidence and drawing fair inferences, and applying the law as it is applies. If you use proposed findings as a partisan opportunity, you just might snatch defeat from the jaws of victory.