Couple Still Fighting Over House Ten Years After Divorce

This small building stands next to the church ...

People getting a divorce generally do not make good business partners.  One Oklahoma couple learned this the hard way.  After trying to maximize the return on their marital residence, they ended up back in court ten years later.

The Original Plan
When the couple divorced in 1995, they entered into a settlement agreement which placed the marital residence  in a Trust “established for the purpose of holding title to and selling same.”  Their stated goal was to get the highest and best price for the house.  The trust provided that wife would continue to live in the house.  Neither the trust nor the settlement agreement were incorporated into the decree dissolving the marriage.

The Plot Thickens

Ten years pass without an offer on the house.  The wife still lives there, and is renting rooms to tenants.  Husband files suit asking the court to remove wife as trustee, and appoint a receiver for the house.  After a contested hearing, the trial court first took control of the trust and ordered the parties to cooperate in selling the house.  After 10 months passed without a sale, or even a listing agreement, the trial court appointed a receiver to take control of the property.  Wife appealed, and the Oklahoma Court of Civil Appeals affirmed the appointment of a receiver.

The Lesson Learned
Despite the best laid plans of the couple, they failed to maximize their investment in the marital residence.  The take-away from this couple’s misfortune – do your best to sever all financial ties to your former spouse in the divorce documents.  Lingering financial connections leave opportunity for continuing discord, and abuse of fiduciary relations.

by David Tracy

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What Will Your Divorce Ceremony or Ritual Look Like?

The legal process of divorce does nothing to heal the emotional pain caused by ending a marriage relationship. Filing final papers in court makes you legally single, but healing the damage to your psyche follows an unrelated timetable.  Divorce can be even more traumatic than the death of a loved one. Instead of a loss fixed in time, the end of a marriage can seem like a death of a thousand cuts.

Like a marriage ceremony brings two people together, a divorce ceremony or ritual places you and your spouse on separate paths and promotes emotional healing.  It can be a private ritual involving just yourself, your immediate family, or one or two close friends.  You can involve a larger group of people, and help them feel more comfortable about the breakup as well.  It can be as elaborate or as simple as you choose.  There is even a newly published book with suggested divorce rituals.  The important point is to give it meaning that promotes dignity, respect and healing.

Robert Fulghum, signing his book What On Earth...

Robert Fulghum (Photo credit: Wikipedia)

Author Robert Fulghum writes about ritual as follows: “Meaningful rituals have a lot to do with gaining that inner harmony and making letting go as much a part of life as holding on.  Rituals anchor us to a center while freeing us to move on and confront the everlasting unpredictability of life.  The paradox of ritual patterns and sacred habits is that they simultaneously serve as solid footing and springboard, providing a stable dynamic in our lives.”  From Beginning To End, the Rituals of Our Lives.  Random House, 1995 (p. 265).

A divorce ceremony or ritual serves an important dual purpose.  It helps you let go of the past – to place a period on a chapter of your life.  You are then free to spring into the next chapter of your life – minus the burdens you intentionally leave to the past.

Too much analysis of your divorce ceremony can lead to paralysis.  Give some thought to what works for you, but don’t be afraid to trust your instincts.  Your divorce ceremony can be as elaborate as a wedding reception (complete with divorce vows), or as simple as a meditation (or smashing something into small pieces).  You and your ex might plan something together.  Your circumstances might call for you to plan an event on your own.  Any ritual or ceremony that speaks to you will work, but it does require some action on your part.  The internet has resources to plan your divorce ritual or ceremony.  Do some research.  Talk to your counselor, your spiritual advisor, or a close friend. Don’t just read about it or think about it.  Plan it and do it.  You’ll be glad you did.

by David Tracy

Obamacare And Divorce – It’s Still Complicated

Senate Passes Insurance Industry Aid Bill

(Photo credit: Mike Licht, NotionsCapital.com)

The U S Supreme Court largely upheld the Patient Protection and Affordable Care Act of 2010 (ACA) last week.  The ACA provides more options in coming years for divorcing families who face health care choices.  However, many of the means to the end of making health care more  available and affordable remain to be set. The major goals of the ACA, and its promise for the divorced population, still hang in the balance.

Over the course of ten years, nearly half of the non-elderly population will go without health insurance for some time (U.S. Dept. of Treasury 2009).  Many of these people lose coverage due to a divorce. A lack of cost-effective alternatives often leads to gaps in health insurance.

The traditional method of continuing coverage for the last generation is COBRA (named for the Consolidated Omnibus Budget Reconciliation Act which created it).  COBRA allows someone no longer eligible for group coverage to continue on the policy as an individual for up to 36 months after a divorce.  The employer contributes nothing to the coverage cost, making it cost-prohibitive for many.

If COBRA coverage is not practical, one historically had to explore other alternatives.

  • Find a job with a group health benefit.
  • Buy coverage in the individual health insurance market.
  • Qualify for a public program such as Medicaid or the Children’s Health Insurance Program (SoonerCare in Oklahoma).
  • Go without insurance, cross your fingers and hope for good health.

Those with pre-existing conditions faced added challenges, as they are thrown into high-risk pools with high costs and coverage exclusions.   Many private insurers will decline coverage, make it unaffordable, or make it ineffective with exclusions.  This will change quite a bit under the ACA.

Some changes under the ACA are already in effect.

  • Health plans cannot drop your coverage when you develop an illness or medical condition.
  • You may cover your children on your group health policy up to age 26.
  • Your children will not be denied coverage based on a pre-existing condition.
  • Your plan cannot impose annual or lifetime dollar limits for essential health benefits.
  • The Oklahoma Temporary High Risk Pool provides a bridge program to temporarily cover people who cannot get coverage elsewhere due to pre-existing conditions.  You have to go uninsured for 6 months to qualify for temporary high-risk coverage.

Some changes easing the challenge of post-divorce insurance planning do not take effect until January of 2014.

  • If not covered by an employer plan, people must either get health insurance on their own, pay a penalty on their income tax, or qualify for an exemption.
  • States, or the federal government by default, will set up health insurance exchanges.  These exchanges will outline the competing health insurance plans available to you, and the premium for coverage.
  • The exchange will also offer calculators to figure cost-sharing reductions and premium tax credits available depending on your income and coverage.
  • The amount of the subsidy you’re eligible for will depend on your income. Those with incomes of up to 400 percent of the federal poverty level ($43,560 for an individual and $89,400 for a family of four in 2011, according to the Kaiser Family Foundation) are eligible for premium assistance credits.

The exchanges hold promise for an added cost-effective alternative for divorcing spouses and families.  the U. S. Secretary of Health and Human Services must develop rules for making premium tax credit eligibility determinations based on changes in circumstance, such as a divorce.  We should all stay alert to the when and how of the exchanges, and the premium subsidies.  They will become part of divorce planning very soon.

by David Tracy

Sources:
Link to Text of the Affordable Care Act

How the Affordable Care Act Affects You, CBS News Money Watch, June 29, 2012

The Promise of the Affordable Care Act, the Practical Realities of Implementation: Maintaining Health Coverage During Life Transitions, O’Leary, Capell, Jacobs, and Lucia, Center for Labor Research and Education, University of California, Berkeley; Chief Justice Earl Warren Institute on Law and Social Policy, UC Berkeley School of Law (2011)

Health Reform Subsidy Calculator, Kaiser Family Foundation

Supreme Court Ruling Making Medicaid Expansion Optional Gives Fallin A Big Decision, Tulsa World, July 3, 2012

Terminating Parental Rights Is Not A Quick Fix For A Poor Parenting Relationship

Can one parent waive receiving child support, the other parent waive visitation, and the parents agree to terminate the rights of the non-paying, non-visiting parent?  Family law attorneys answer this question regularly.   The short answer in Oklahoma is no.

The Oklahoma Legislature repealed the statute authorizing private termination of parental rights in 1997.  A parent can still lose his or her parental rights in Oklahoma in the following ways:

  • The state can move to terminate parental rights in a juvenile case for deprived children.
  • A judge in an adoption case can declare a child eligible for adoption without the consent of a parent in some circumstances.

Unless there is an adoption or a juvenile case in the works, living parents keep all the rights and obligations of a parent. A person’s status as a parent is a fundamental constitutional right, subject to due process and equal protection under the law. Your options are limited to enforcing or modifying those rights and obligations.

Sometimes a parent  will try to come back into a child’s life after an extended voluntary separation.  Both parents in that situation must put the interests of the child above their own.  The formerly absent parent may want to rush a relationship to make up for lost time. An active parent who has taken up slack for an absent parent will often resist efforts at reunification out of resentment or anger at the other parent.  Remember, though, this is about the child, and the child’s needs.

Do your best to identify and meet your child’s needs, setting aside your own.  Both parents must strike a balance between a child’s need to have a relationship with both parents, and the child’s need to adjust to changes in family circumstance.  If you cannot strike that balance by  agreement, you may need the help of the family court to oversee custody and parenting time decisions.

by David Tracy

A Note on Fatherhood – Are You On Your Child’s Birth Certificate?

A recent Centers For Disease Control & Prevention report documents the rising number of out-of-wedlock births.  From 2006-2010, 45% of women age 15-44 who had children were unmarried, either not living with, or living with but not married to the father.  The number of women living with but not married to the father of their first-born child tripled in the last 10 years.  One can rebut the presumption of paternity for men married to a child’s mother.  These facts complicate the process of listing fathers on birth certificates.

The Oklahoma Uniform Parentage Act lists the methods you can use to assure your listing as father of record on your child’s birth certificate.  Unless you qualify for listing as the child’s father under one of the definitions below, you are just an “alleged father.”  You or the mother may claim you are the father, but your parentage has not been determined.  Make sure you meet one of the following definitions, and that the paperwork is complete to include your name on your child’s birth certificate.

Presumed Father – A presumed father of a child is married to the child’s mother.  The child may also be born within 300 days after your marriage to the child’s mother ends.  You are also a presumed father if you declare as a matter of record the child as yours, and marry the mother after the child is born.  Even if you do not marry the mother, you are a presumed father if you live in the same household as the child, and hold the child out as your own for the first two (2) years of the child’s life.

Acknowledged Father – If the mother is willing to cooperate, you can send a completed Acknowledgment of Paternity form to the Oklahoma Department of Health Vital Records Service (VRS). After the VRS accepts the form, it will amend the birth certificate to list you as the father. You can get the form online here, from the VRS, your county health department, the Office of Child Support Services, or from any hospital with a maternity ward.

Adjudicated Father – If the mother does not wish to cooperate, you can file a Petition with the district court to determine parentage. If the mother admits your paternity or a DNA test determines paternity, you can get a court order declaring you the father. You can then use the court order to amend the birth certificate.

by David Tracy

Dividing Stock Options In A Divorce – Part III

In Part I of this topic, I discussed how stock options are characterized as marital or separate property.  Part II of this topic addressed the valuation and distribution of stock options in divorce actions.  This last in the series, Part III, discusses the information needed to divide stock options in divorce.

Each case involving stock options is fact specific.  The employee spouse who holds the options must share information with the non-employee spouse.  The parties should exchange the following general information to properly characterize, value and divide stock options.

•    The employer stock option plan
•    Any Summary Plan Description
•    All documents actually granting an option to the employee
•    All documents describing why the employer grants the options
•    Any benefit statements describing outstanding options
•    Any reference in the Employee Manual to any stock option program
•    Any documents amending an option plan or an option grant

This is a good starting point for locating the information you need.  Request more information if you are not sure of the following:

•    The number of shares granted to the employee for each option
•    The purpose of the grant
•    The grant date
•    The vesting date
•    Any preconditions before vesting occurs
•    The date of exercise of any grants
•    The expiration date
•    The strike price (the price at which the employee may buy the shares)
•    The tax treatment of any award (ordinary income or capital gains), and how the tax will be paid
•    Any amendments to the option plan, or any options granted
•    Whether the options are transferable (not likely, but you might get lucky)

by David A. Tracy

Time to Check Your Will After Supreme Court Denies Survivor Benefit for Twins Conceived After Father’s Death

A U. S. Supreme Court decision this week serves as a wake-up call for careful drafting or amending of your Last Will and Testament.  It is also a call to action for state legislatures.  The Court denied a Florida mother survivor benefits for twins conceived by in-vitro fertilization (IVF) after her husband died.  The court held unanimously that Karen Capato could not collect survivor benefits for the twins from the Social Security Administration (SSA).  She had the twins 18 months after her husband died, using his frozen sperm.

SSA turned the application down because Capato’s twins, who were conceived posthumously, did not qualify to inherit from their late father under Florida law.  The court states that SSA properly looked to state law to determine the children’s eligibility for the federal entitlement.

The effect of this U. S. Supreme Court decision in Oklahoma is unclear.  There is no state statute or case law discussing the inheritance rights of children conceived by mothers using the frozen sperm of a deceased father.  According to this article from National Public Radio, thirteen states have laws that specifically allow posthumously conceived children to inherit in cases where there is no will. Four states, including Florida, specifically do not allow it.  In the rest of the country, as in Oklahoma, the law is unclear.

It is a growing phenomenon for persons with life-threatening illnesses or hazardous job duties (like soldiers headed into combat) to store sperm for later use.  If you have stored sperm, there is a lesson for you in this weeks’ Supreme Court case.  Please contact an attorney promptly to draft or amend your Last Will and Testament. You need to include a clause that children conceived by IVF after your death should (or should not) be treated as your other surviving children.

For those who don’t have a Last Will and Testament, this issue needs to be addressed by the Oklahoma Legislature.  I think children conceived through IVF, even after the father has passed away, should be treated the same as children born while both parents were alive.  Oklahoma lawmakers can, and should, make this happen.

Please share your thoughts on the case of Astrue v. Capato in the Comments section below.

by David Tracy