CATES v. SWAIN CONCLUDED
May 13, 2013 § Leave a comment
I posted here and here about the saga of Cates v. Swain, the COA decision that essentially denied cohabitants any equitable relief to recover assets invested in the relationship. You can read the fact outline in that first prior post.
At trial the chancellor had rejected Mona Cates’ agrument that she was entitled to imposition of either a resulting or constructive trust, but granted her relief on the theory of unjust enrichment.
On appeal, the COA reversed, applying the rationales in Davis v. Davis, 643 So.2d 931 (Miss. 1994) and Estate of Alexander v. Alexander, 445 So.2d 836 (Miss. 1984), to reach the conclusion that equitable remedies are not available to unmarried parties who acquire assets titled in only one party’s name through the contributions of both. The court agreed with the chancellor that neither equitable trust should have been imposed, but disagreed that unjust enrichment could be applied.
On May 2, 2013, the MSSC reversed the COA decision and affirmed the chancellor on the theory of unjust enrichment. The court distinguished the cases that had been relied upon by the COA. The court did modify the amount awarded by the chancellor. Justice Dickinson, concurring in part and dissenting in part, would have remanded the case to the chancellor for further evidence on what would have been an equitable determination of what each party should receive, based on appreciation of the investments over time.
In my opinion, this decision clarifies the state of the law in an important area. Unmarried relationships are a fact in Mississippi, and there has to be a mechanism for people to recover money or property that in good conscience and justice should not be retained by another.
There is, of course, the danger that the doctrine will be overapplied and stretched to the breaking point. As the court’s opinion stated at ¶ 19, quoting an Iowa case, ” … [T]he doctrine of unjust enrichment is not ‘a roving mandate [for a court] to sort through terminated relationships in an attempt to nicely judge and balance the respective contributions of the parties.'” Applied carefully and judiciously, however, as the chancellor did at trial in this case, it’s a useful tool in an appropriate case, and it’s no longer precluded in our jurisprudence.
“QUOTE UNQUOTE”
May 10, 2013 § Leave a comment
“To handle yourself, use your head; to handle others, use your heart.” — Eleanor Roosevelt
“My parents had only one argument in forty-five years. It lasted forty-three years.” — Cathy Ladman
“And they lived happily (aside from a few normal disagreements, misunderstandings, pouts, silent treatments, and unexpected calamities) ever after.” — Jean Ferris
PROCESS IN MEXICO
May 9, 2013 § 3 Comments
Attorney Joy Harkness of Legal Services in Meridian posted a comment to a post yesterday that raised an intriguing question — one that you might just bump into in your own practice, particularly with the numbers of migrant workers in our state.
Here’s the query:
“I am looking for assistance in serving process on a resident of Mexico. It is my understanding that process by publication is not valid under the Hague Service Convention if the address if the defendant is known. It is also my understanding that the summons has to be translated into Spanish. I am looking both for advice on the procedure and someone to provide the translation.”
Has anyone else run into this, or has anyone researched this?
I thought this should be in a post, where more folks might see it, rather than in a comment.
We have a notable number of divorces (almost all I.D. divorces) involving Latin-Americans, mostly Mexicans, in this district. They are as routine as any other I.D. divorces, but there are some with problems. I denied one father’s request for visitation because he could not provide a legitimate address, and claimed to have lost his passport. When I asked to see his DL, he produced a fake with a fake address. Since two witnesses had testified that he had said he wanted to take the children back to Mexico with him, I thought that he should be better documented before we did that.
CHANGE TO THE CHILD SUPPORT GUIDELINES
May 8, 2013 § 2 Comments
MCA 43-19-101(e) has been amended, effective July 1, 2013, to provide that:
“In cases in which the adjusted gross income as defined in this section is more than One Hundred Thousand Dollars ($100,000) or less than Ten Thousand Dollars ($10,000), the court shall make a written finding in the record as to whether or not the application of the guidelines established in this section is reasonable.”
Right now the figures are $50,000 and $5,000.
This change is a recognition of changing economic realties. The original figures were established by the legislature in 1989 — 24 years ago.
EQUITABLE DISTRIBUTION AS THE GATEWAY TO ALIMONY
May 7, 2013 § Leave a comment
The COA case of Jones v. Jones, decided April 30, 2012, is a reminder that, if the equitable division of the marital estate has made adequate provision for the spouses, there should be no award of alimony — not even nominal alimony.
In Jones, the chancellor carefully considered and analyzed all of the Ferguson factors as they applied to the case, and specifically found that the equitable division made sufficient provision for Jane Jones (she received 62.5% of the marital estate). He nonetheless awarded her nominal alimony of $10 a month in case she needed alimony in the future.
The COA affirmed the chancellor’s decision on equitable distribution, but reversed and rendered as to the nominal alimony. Judge Maxwell wrote for a unanimous court:
¶35. However, we do find manifest error with the award of “nominal” permanent—or periodic—alimony in the amount of $10 per month. See Armstrong v. Armstrong, 618 So.2d 1278, 1280 (Miss. 1993) (reviewing alimony awards for manifest error). We note the chancellor correctly identified and applied the Armstrong factors. See id. But he did so after acknowledging he had made sufficient provision for Jane through the equitable division of the property so that permanent alimony was not needed. Alimony should only be considered if the property division leaves one spouse in a deficit. Johnson, 650 So. 2d at 1287. “If there are sufficient assets to provide for both parties, then there is no more to be done.” Carter v. Carter, 98 So. 3d 1109, 1112 (¶8) (Miss. Ct. App. 2012) (citing Johnson, 650 So. 2d at 1287).
¶36. By referring to the award as “nominal” alimony, it does not appear that the chancellor was trying to address an actual deficit in the property award. Rather, he admits he was simply leaving the door open in case future events prove Jane has a need and John has an ability to pay. Such a contingency plan, while well-meaning, simply is not supported by our law. Alimony is to be considered as a remedy to an actual insufficiency in the marital assets, not as a contingency for a possible insufficiency in the future. Because the chancellor found the division of marital property left no need for alimony, we find it was error for the chancellor to nonetheless award “nominal” alimony. We reverse and render the award of $10 per month in permanent alimony award.
A good way to think about this is that equitable division is the gateway to alimony. Only after the chancellor has evaluated the Ferguson factors and adjudicated equitable division, and then having found that the equitable division leaves a discrepancy, may the chancellor even consider awarding periodic or rehabilitative alimony.
A caveat: Lump sum alimony, contrary to periodic or rehabilitative alimony, is a tool to achieve an equitable division of the marital estate.
Another consideration to bear in mind: I have tried contested cases where the lawyers have stipulated that the only issue is alimony, and they offered no proof whatsoever on the Ferguson factors. That, in my opinion, plants error in the record. You can not get to alimony without first going through Ferguson.
HARD GARNISHMENT LESSON FOR A JOINT ACCOUNT OWNER
May 6, 2013 § Leave a comment
Dorothy Lang and Derrick Higgins were estranged husband and wife. Despite that they were living separate and apart, they maintained two joint bank accounts at the same bank, with Dorothy continuing to use the joint savings account, and Derrick continuing to use the joint checking account.
Derrick got behind in his child support payments to another woman — to the tune of $17,000 — and DHS in April, 2010, froze both joint accounts per MCA 43-19-48, imposing a lien on the deposits. When Dorothy discovered what had happened, her attorney sent a letter to DHS in May, 2010, advising them that the funds were Dorothy’s, not Derrick’s. DHS thoughtfully responded the next day with a letter pointing out that Dorothy was required by statute to file a petition with the court if she wished to challenge the lien.
Dorothy took no action immediately, and on June 17, 2010, DHS received $3,116.69 from the two accounts, no doubt causing Dorothy some economic distress. The date of the disbursement was more than 45 days after the freeze.
Finally, in September, 2010, Dorothy got around to filing a contest to the lien, and, at an evidentiary hearing, produced proof that most of the money seized was, indeed, hers, and not Derrick’s. The chancellor ordered DHS to refund Dorothy $2,000 of the money, and DHS appealed.
In DHS v. Lang, handed down by the COA on April 23, 2013, the COA reversed and rendered. Judge Fair’s opinion for a unanimous court, explained:
¶8. … [A]lthough the statute contemplates an account holder of interest challenging the encumbrance, it does not provide a method to do so. As written, the statute does not require DHS to send notice to joint account holders, and only the obligor is subject to any specific time for filing. Other states, such as Alabama and Texas, have specifically provided for the right of a joint account holder to challenge such an encumbrance and prove ownership of the funds. See Ala. Admin. Code r. 600-3-12-.06 (2011); Tex. Fam. Code Ann. § 157.326 (2001). We conclude that our Legislature intended to acknowledge an account holder of interest’s right to challenge a DHS encumbrance, but it did not create a new mechanism for such a challenge. Instead, the Legislature left that to independent actions, just as ordinary garnishment law does.
¶9. The Mississippi Supreme Court has considered the garnishment of joint accounts. In Delta Fertilizer, Inc. v. Weaver, 547 So. 2d 800 (Miss. 1989), Delta secured a judgment against Weaver, and the circuit clerk issued a writ of garnishment on a joint savings account in the names of Weaver, his sister, and his mother. Before the garnishment was awarded, the mother filed a motion with the court, claiming to be the sole owner of the account. Id. at 801. The mother testified that all the funds belonged to her and that her children’s names were on the account for convenience because she could not handle her own money anymore. Id. Citing Cupit v. Brooks, 237 Miss. 61, 112 So. 2d 813 (1959), the court noted that a joint checking or savings account was subject to garnishment but held that it “should be garnishable only in proportion to the debtor’s ownership of the funds.” Delta, 547 So. 2d at 802-03. The burden rests on each depositor to show what portion of the funds he actually owns, and parol evidence is admissible to show his contributions. Id. at 803.
¶10. Relying on the Mississippi Supreme Court’s decision in Delta, we agree that an account holder of interest may challenge a DHS encumbrance in an independent action and present evidence to prove her contribution to the funds. The depositors are in a much better position than DHS to know the pertinent facts regarding their joint account. And while the DHS Child Support Unit has a legislatively mandated charge to enforce child-support obligations, administratively and through litigation, we do not believe the Legislature intended to dismiss the interest of joint account holders. That being said, a joint account holder must file some formal pleading within a reasonable time. Otherwise, such funds obtained by DHS would always be subject to remittance, preventing the funds from being timely disbursed to impoverished children.
The court then turned to the question whether Dorothy’s letter to DHS or her petition filed nearly three months after the order disbursing funds was effective to regain her funds. The COA answered “no”:
¶12. This Court dealt with an analogous situation in Triplett v. Brunt-Ward Chevrolet, Oldsmobile, Pontiac, Buick, Cadillac, GMC Trucks, Inc., 812 So. 2d 1061 (Miss. Ct. App. 2001). There, a mother, Triplett, held an account with Union Planters and named her daughter as a joint account holder. Id. at 1063 (¶2). A garnishment was issued naming the daughter as the debtor. Id. Although Triplett admitted that she became aware of the attachment within two days of service of the writ of garnishment, but never intervened as a proper party. Id. at 1067 (¶13). After the funds were disbursed to the creditor, Triplett filed a complaint alleging Union Planters was negligent in its failure to notify Triplett that the funds were exempt. Id. at 1064 (¶4). On appeal, this Court explained that the garnishment statute “has been construed to mean that, in order to suspend the execution of the writ of garnishment, a sworn declaration must be filed in the court before the garnishee has answered and paid into court the funds caught by the garnishment.” Id. at 1067 (¶11) (citing Miss. Action for Cmty. Ed. v. Montgomery, 404 So. 2d 320, 322 (Miss. 1981)).
¶13. Here, DHS correctly presumed that all funds in the joint account belonged to Higgins and filed a notice of encumbrance [footnote omitted]. On May 27, DHS advised Lang to file a petition with the court pursuant to section 43-19-48 in order to object the encumbrance. While we disagree that Lang was required to file pursuant to section 43-19-48, she failed to file any petition to the court before the funds were disbursed. Further, Lang presents no reason for her delay. “A letter is not the equivalent to a sworn declaration filed according to the relevant statute. It is too little, too late.” Triplett, 812 So. 2d at 1067 (¶12) (internal citation omitted).
Parting thoughts …
- I wonder whether Dorothy now thinks it was worth the few extra bucks she saved to keep that joint account open with her n’er-do-well estranged husband. [Incidentally, the COA opinion points out that Derrick owed Dorothy back child support also. Ouch.].
- Don’t sit on a case like this. File something right away, even if it’s wrong. You can always amend later, and you can continue to negotiate and talk with pleadings filed. Here, the five-month delay was fatal to Dorothy’s claim.
- This may seem like a rare case, but I actually have had a couple of cases where the question was raised about the rights of joint-account owners. They were resolved, but you never know when yours will not be.
NOTICE FOR A DAY CERTAIN
May 2, 2013 § Leave a comment
Although the COA decision in In the Matter of Transfer of Structured Settlement Payment Rights by Benny Ray Saucier, handed down March 26, 2013, nominally dealt with the notice provisions of the Mississippi Structured Settlement Protection Act (MSSPA), MCA 11-57-1 through 15, it punctuates an important point about notice and process that applies in other cases as well.
The statutes in this case specify certain notices that must be given to “all interested parties”:
- Section 11-57-11(2) states that, “Not less than twenty (20) days prior to the scheduled hearing on any application for approval of a transfer of structured settlement payment rights under Section 11-57-7, the transferee shall file with the court . . . and serve on all interested parties a notice of the proposed transfer and the application for its authorization … “
- And subsection (f) states that, “Notification of the time and place of the hearing and notification of the manner in which and the time by which written responses to the application must be filed which shall be not less than fifteen (15) days after service of the transferee’s notice in order to be considered by the court or responsible administrative authority.”
The statute, however, does not spell out what form of process or notice should accomplish what the statute mandates.
Here’s what the COA said in the majority opinion by Judge Griffis:
¶68. The MSSPA does not specify the appropriate notice that is required section 11-57-11(2). Because the MSSPA requires court approval, “[a] civil action is commenced by filing a complaint with the court.” M.R.C.P. 3(a). To obtain personal jurisdiction over an interested party, service of process is required consistent with either Rule 4 or Rule 81 of the Mississippi Rules of Civil Procedure. Although the MSSPA is not included among the actions subject to Rule 81(a), reading section 11-5-11(2), we interpret notice to require a return for a date certain similar to the procedure authorized in Rule 81(d)(5). At a minimum, once the original notice is provided to an interested party, notice of subsequent proceedings must comply with Mississippi Rule of Civil Procedure 5.
So, in these cases where a statute provides notice for a given period, and the matter is not among those enumerated in MRCP 81(d)(1) and (2), your safest course is to issue process to a day certain under MRCP 81(d)(5). In my experience this is exactly what practitioners and judges have been doing since the earliest days of the MRCP, but it is nice to see the appellate court’s stamp of approval on the practice, since it makes complete sense.
KEY CHANCERY CASES JANUARY 2012 – MARCH 2013
May 1, 2013 § Leave a comment
Many of these have been addressed in prior posts. This puts them all together in one place.
Lee v. Lee, 78 So.3d 326 (Miss. 2012)
Even in uncontested cases, it is essential that your judgment address all of the applicable factors, such as Albright, Ferguson, Martin v. Coop, etc.
Lone Star Industries, et al. v. McGraw, MSSC February 2, 2012 and McKnight v. Jenkins, MSSC February 14, 2013
If you file an amended pleading outside the time allowed and do not get leave of the court to file an amended pleading, the amended pleading is a nullity and should be stricken by the court.
Bolivar v. Waltman, COA April 3, 2012
All parties who would be necessary parties in a child custody case are required to be joined in a suit for grandparent visitation. This requirement of MCA 93-16-5 is jurisdictional, and may be raised by the trial court on its own, or by the appellate court on its own.
Cates v. Swain, COA April 17, 2012
Equitable remedies are not available to unmarried parties who acquire assets titled in only one party’s name through the contributions of both. The MSSC has granted cert in this case.
McMullin v. McMullin, COA May 29, 2012
If the chancellor’s opinion resolves fewer than all of the issues in the case, you must have the judge certify under MRCP 54(b) that there is no just reason to delay an appeal, and stating the reasons why. Otherwise, if you appeal, your appeal will be dismissed.
Easley v. Easley, COA June 5, 2012
When the parties enter into a consent for divorce and one of the contested issues who will be granted custody, the court may award the parties joint custody if the court deems it in the child’s best interest, regardless whether joint custody was listed as an option.
LePori v. Welch, COA June 26, 2012
There is no cause of action for termination of parental rights unless it is in contemplation of an adoption.
Rogers v. Rogers, COA July 24, 2012 and Dogan v. Dogan, COA October 9, 2012
If you are going to claim that the other party has perpetrated a fraud on the court as in Trim v. Trim, you have to plead fraud specially and prove all of its elements by clear and convincing evidence.
Marter v. Marter, COA August 7, 2012
Three acts that do not convert separate property to marital property for equitable distribution purposes: labor for plantation and maintenance; joint titling; and payment of property taxes.
Collins v. Collins, COA August 21, 2012
8.05 financial statements are the “gold standard” of proof as to assets and their values in a divorce, and the chancellor may rely on them solely in the absence of other evidence.
Strickland v. Strickland, COA August 28, 2012
Once the record has been transmitted to the MSSC in an appeal, the trial court has no jurisdiction whatsoever to reconsider, set aside, enforce or modify the order appealed from.
Brown v. Tate, 95 So.3d 745 (Miss. App. 2012)
The importance of entering an order of continuance on the return day in Rule 81 cases.
Ballard Realty, et al. v. Ohazurike, et al., MSSC September 6, 2012
A circuit court case in which the MSSC said that it was error for the trial judge to allow an expert to testify when the party offering him had not responded to the expert witness interrogatory seeking the substance of his testimony.
O’Briant v. O’Briant, COA October 16, 2012
Yet another case in which the appellate court points out that the Albright factors are not a scorecard in which winner takes all, but are a matrix for the court to use to assess the best interest of the child.
Jones v. Jones, COA November 13, 2012
When the chancellor has denied a divorce, she is under no duty to adjudicate custody pled as one of the prayers for relief in the divorce.
Estate of Holmes, COA November 29, 2012
The two subscribing witnesses to a will must be prepared to testify: (1) that they knew they were witnessing a will; (2) that the testator requested that they witness a will; and (3) that they did satisfy themselves that the testator was of sound and disposing mind when she executed the will.
Ford Motor Co. v. Ferrell, et al., MSSC December 6, 2012
Where the settlement that the chancellor is to approve is between private parties, the court should honor a party’s request to seal the record.
Sullivan and Stubbs v. Maddox, COA January 22, 2013
Attorney and his client jointly assessed with $43,000 in attorney’s fees and costs as a sanction where the proof showed that the lawyer had not investigated the merits of the claim before suit was filed, did not dismiss the case when discovery showed it was meritless, and then knowingly made false accusations against the judge on the record.
Gillespie v. Gillespie, COA January 29, 2013
Proof of grounds for divorce requires corroborating evidence, which is not necessarily strong enough in itself to prove the ground, but does tend to support the proof of the ground and a finding that it is true more likely than not.
Hollis v. Baker, COA February 12, 2013
If you fashion a hybrid alimony arrangement in a property settlement agreement or agreed judgment, and the court later finds it ambiguous, the ambiguity shall be resolved in favor of it being construed as periodic alimony, with all of the attendant attributes of periodic alimony.
Fore v. Fore, COA February 19, 2013
Both parties charged each other with post-separation adultery, and the chancellor denied both of them a divorce. Affirmed.
Caplinger v. Julian, COA February 12, 2013
Every judgment for child support must bear interest, set at a stated rate to be determined by the court pursuant to MCA 75-17-7.
Hall v. Lewis, COA February 12, 2013
Unmarried couple who lived together entered into mutual contract to provide for each other in their respective wills. Contract held not to be abrogated by the discontinuance of the relationship. Contracts for will are enforceable in Mississippi.
Forbes v. St. Martin, COA March 5, 2013
A must-read opinion on ethical aspects of contingent-fee contracts and the duties of out-of-state lawyers who participate in Mississippi litigation without applying to the court to appear pro hac vice.
A JUDGE NEEDS YOUR PRAYERS
April 30, 2013 § 5 Comments
Chancellor Ed Roberts of Oxford suffered stroke symptoms while on the bench last week. He at first insisted on finishing his docket, but finally relented and agreed to be taken to the ER at Baptist Hospital.
It was at the hospital that he learned that he has inoperable lung cancer and brain cancer. He is headed to MD Anderson Hospital in Houston.
I know he and his wife Sheila would appreciate your prayers. Judge Roberts’ brother, Larry, is a judge on the Court of Appeals. Both are natives of Meridian.
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