Family Law Update for December 2017
In this Issue …
A Word from Gregg Herman
Elimination of deductibility of maintenance is possible.
Wisconsin Courts Updates
No new cases.
Decisions Across The Nation
Effect of criminal conviction, Standing of non-parent, Valuation of land owned by LLC, Effect of custodial rights contract and more.
Legislative Watch
Proposal to repeal maintenance deduction (for future cases) and Thoughts on Family Law video.
Adoption
Foster parent right to contest removal of a foster child.
A Word from Gregg Herman …
Tax deductibility of maintenance is in jeopardy. The house version of the Tax Cuts and Jobs Bill of 2017 would end the income tax deduction for individuals who pay alimony/maintenance.
This is very serious – and could very well happen. Listen to my video message this month and call your congressman/woman or Senator Johnson and Baldwin.
The AAML is, apparently, the only organized family law group to actively oppose this legislation. For their position, please visit the AAML web site.
For more information, and my video on the topic, please see Legislative Watch below.
Wisconsin Courts Update
No new cases.
Decisions Across the Nation
The following cases are provided courtesy of Contributing Editor Laura Morgan, Family Law Consulting. Laura is available for consultation, brief writing and research on family law issues throughout the country. She can be reached through her Web site or via e-mail.
Please Note: Most decisions are posted in Adobe Acrobat (PDF) format.
Patnode v. Urette
2017 VT 107
Vermont Supreme Court
November 17, 2017
Mother being sole parent with rights and responsibilities to child did not permit court to hold that mother had sole authority to sign any releases or waivers of liability associated with child’s activities, in parentage action brought by mother. By granting mother the unilateral authority to veto activities for the child during father’s time by withholding her signature, father’s time with child would become little more than a babysitting function.
Linda G. v. James G.
2017 N.Y. Slip Op. 07968
New York Supreme Court, Appellate Division, First Department
November 14, 2017
Husband’s insider trading, and ensuing criminal trial, conviction and incarceration warranted a 60%/40% equitable division of the value of the marital estate; husband caused the family to undergo financial losses and a substantial decrease in the standard of living, and those events significantly disrupted the family’s stability and well-being. Further, a credit to the wife of 50% of marital funds expended in connection with Securities and Exchange Commission investigation and criminal proceedings against husband was appropriate, since the wife was not a party to the SEC action and she believed the husband’s assertions of innocence.
Northington v. Northington
No. 2160352
Alabama Court of Civil Appeals
November 9, 2017
Postnuptial agreement, pursuant to which wife relinquished claim to real estate and business in which husband had an interest, was not rendered unfair and inequitable by fact that husband provided wife only with cost, and not market value, of real estate and business. Wife agreed to sign agreement rather than end marriage after husband discovered her affair, negotiations regarding agreement lasted roughly 27 months, wife consulted with three attorneys and was represented by attorney at time she executed agreement, wife had been married to husband for almost 20 years at time agreement was signed and was familiar with real estate at issue and income derived from business in question, and husband provided wife with methods she could use to learn values of properties.
Schmitt v. Troche
2017 N.Y. Slip Op. 07732
New York Supreme Court, Appellate Division, Second Department
November 8, 2017
Nonparent lacked standing as against father to seek custody of father’s child; while record established that nonparent had been involved in child’s life since child was a baby, and that child had primarily resided with nonparent, rather than father, for a number of recent years, that period coincided with period when father was working full time and attending law school at night, during which father was contributing to child’s financial support, and father and nonparent had completed forms designating nonparent as child’s caregiver, though forms were of limited duration and indicated father was not giving up custodial rights.
Duran v. Mercado
2017 N.Y. Slip Op. 07725
New York Supreme Court, Appellate Division, Second Department
November 8, 2017
New York Family Court lacked subject matter jurisdiction over mother’s petition for child custody, filed just two days after Pennsylvania court issued an order awarding sole legal and physical custody of child to father, who was a Pennsylvania resident; Pennsylvania had exclusive continuing jurisdiction over custody dispute, since father continued to reside there, and Pennsylvania court had not determined that New York would have been a more appropriate forum.
Richarz v. Richarz
2017 S.D. 70
South Dakota Supreme Court
November 8, 2017
(1) The appropriate valuation of land owned by a limited liability company (LLC) in which husband was a minority owner, for purposes of valuing husband’s interest in the LLC as marital property upon divorce, was a comparable sales approach used by wife’s expert, a licensed real estate broker and certified appraiser who sold a parcel three and a half miles from the land, rather than the conflicting lower valuations from two other experts; wife’s expert’s higher valuation was more persuasive not only because of expert’s personal experience but also because his report was more specific and his comparables were closer in time and close in distance. (2) A minority discount did not apply in valuing marital property consisting of husband’s interest in a limited liability company (LLC) in which he was minority owner, where the LLC was a family LLC that husband had always managed, court could not envision scenario in which husband would not be manager, and husband had transferred enough interest to his father to reduce his ownership interest to less than 50% with no legal obligation to do so. (3) A lack-of marketability discount did not apply in valuing marital property consisting of husband’s interest in a limited liability company (LLC) in which he was a minority owner, where primary value of LLC was in real estate, wife’s expert testified that discounting husband’s interest was not appropriate because it was unlikely a sale would ever occur, discounting value would mean that wife would receive a discounted interest while husband would retain the full benefit of an undiscounted interest, and had the parties remained married, both would have shared the benefit of the LLC’s income as the LLC was close to paying off all its debt and would then be generating a profit.
S.A.M. v. M.H.W.
No. 2160686
Alabama Court of Civil Appeals
November 3, 2017
Comments by juvenile court judge presiding over child custody proceeding regarding the common knowledge of the use of marijuana by outdoor enthusiasts, those employed by the forestry service, and those living in, or pursuing recreation in, state in which mother worked seasonally for forestry service contained extrajudicial facts that judge had gleaned from his own personal knowledge or beliefs and, thus, violated evidentiary rules precluding judges from acting at witnesses and governing the impermissible taking of judicial notice of adjudicative facts; judge was not commenting on the evidence presented and parties were unable to cross-examine judge about his testimony.
In re G.R.-Z.
2017-Ohio-8393
Ohio Court of Appeals, Ninth District, Summit County
November 1, 2017
The only contractual mechanism recognized under law which allows a parent and non-parent to share in the rights and responsibilities relevant to the care and upbringing of children is a shared custody agreement. To determine whether to order shared custody between a parent and a non-parent, first, the court must determine whether a contract, written or implied by conduct, exists that confers custodial rights on the non-parent; if so, then the court must consider the second prong of the test, i.e., whether it is in the best interest of the children to order shared custody; if, however, there is no contract evidencing the intent for the parent and non-parent to share custody, the trial court need not consider whether shared custody would be in the best interest of the children. Mother and her same-sex domestic partner did not enter valid shared custody agreement with regard to children born while they were romantically involved, and therefore mother did not permanently relinquish some of her custodial rights regarding the children, where plain language of written agreement between mother and partner, which consistently characterized partner’s interest in raising the children as “non-custodial,” indicated no intent to enter shared custody agreement.
Law Review Articles of Note
Timothy Sandefur, Escaping the Icwa Penalty Box: In Defense of Equal Protection for Indian Children, 37 Child. Legal Rts. J. 1 (2017)
Darya Hakimpour, Distributing Children as Property: The Best Interest of the Children or the Best Interest of the Parents?, 37 Child. Legal Rts. J. 128 (2017)
Legislative Watch
The following is provided by Jim P. Caven CPA/ABV, CDFA, CGMA, Director at Pisenti & Brinker LLP in Napa, CA. He can be reached via e-mail.
GOP Tax Bill Threatens Maintenance Deduction
Current law, alimony payments generally are an above-the line deduction for the payor and included in the income of the payee. However, alimony payments are not deductible by the payor or includible in the income of the payee if designated as such by the divorce decree or separation agreement.
Provision
Under the provision, alimony payments would not be deductible by the payor or includible in the income of the payee. The provision would be effective for any divorce decree
or separation agreement executed after 2017 and to any modification after 2017 of any such
instrument executed before such date if expressly provided for by such modification.
Considerations
- The provision would eliminate what is effectively a “divorce subsidy” under current law, in that a divorced couple can often achieve a better tax result for payments between them than a married couple can.
- The provision recognizes that the provision of spousal support as a consequence of a divorce or separation should have the same tax treatment as the provision of spousal support within the context of a married couple, as well as the provision of child support.
JCT Estimate
According to JCT, the provision would increase revenues by $8.3 billion over 2018-2027.
Adoption
Following is provided courtesy of Contributing Editors Stephen Hayes and Elizabeth Neary of Grady, Hayes & Neary, LLC in Waukesha, WI. They can be reached at (262) 347-2001 or via e-mail.
Foster Parent Right to Contest Removal of a Foster Child
Once a family has had a foster child for more than six months and the Department provides notice of intent to remove the child, foster parents should know they have a legal right to challenge the removal. Under Wis. Stats. §48.64, the foster parents have a right to ask for a contested hearing either in court or before an administrative hearing examiner.
Foster parents have a right to a hearing to determine whether it is in the best interests of the child to remove the child from their care. It is important to file the objection to the change in placement notice within ten (10) days of receipt of notice or the right to challenge may be lost.
Social Services may remove the child for emergency reasons before the hearing; however, once the objection to the removal is filed, there should be no removal until the hearing result is announced.
Contributing Editors
Our contributing editors include:
- CPA Scott Franklin. Kohler & Franklin, Milwaukee (Tax Tips)
- Atty. Stephen Hayes (Adoption)
- Gregory J. Ksicinski, CPA/ABV, MSTSVA Certified Public Accountants, S.C.
- Atty. Laura Morgan, Family Law Consulting, Charlottesville, VA (Family Law Cases)
- Atty. Elizabeth Neary (adoption)
We Thank Them for Their Contributions!
