Sunday, January 27, 2013

WHAT HAPPENS WHEN YOUR DO NOT GET YOUR PENSION QDRO FILED?

QUESTION : HYPOTHETICAL QUESTION ISSUE DOES NOT INVOLVE A CURRENT OR PREVIOUS CLIENT- Divorced May 2012 in judgement of divorce a 401(k ) was to be divided. The company is requiring a QDRO in order to begin the division of funds.

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By Terry R. Bankert [trb] terry@attorneybankert.com
www.attorneybankert.com , https://www.facebook.com/attorneybankert, Flint Divorce & Bankruptcy 810-235-1970


The husband the original holder of the 401k submitted two QDRO’s but each has been returned as they were not within the acceptable guidelines.

The ex-spouse asks Is there a time limitation for the lawyer to submit this QDRO to the company? She would also like to know what is it for the state of Mich. and what are the consequences for not complying with this time limit.

RESPONSE:

THERE ARE A LEAST TWO PROBLEMS .AFTER SIX YEARS THE TRANSFER OF THE 401(K) WILL NOT BE PRESUMED TO BE NON TAXABLE. THE HUSBAND MAY HAVE DIED AND THE 401(K) DISPERSED OTHERWISE.

Retirement benefits are often the largest single asset in a divorce. Michigan law requires every judgment of divorce (or separate maintenance) to determine the rights, including contingent rights, of the parties to (1) any vested pension, annuity, or retirement benefits; (2) any accumulated contributions in any pension, annuity, or retirement system; and (3) any unvested pension, annuity, or retirement benefits. MCL 552.101(4). [2]

Your Pensions earned during a marriage are marital property subject to division. [1] This division of retirement or pension plans can be divided using qualified domestic relations order (QDRO) procedures. [1]

The QDRO rules In Michigan apply to private tax-qualified pension, profit-sharing, and stock bonus plans, including defined benefit pension plans, 401(k) plans, most 403(b) plans and 457 plans, money purchase pension plans, cash balance plans, and employee stock ownership plans (ESOPs). [2]

A Michigan state court domestic relations order (DRO) that is a QDRO within the meaning of IRC 414(p) and 29 USC 1056(d)(3) must be honored by retirement plans that are subject to ERISA. If a DRO is a QDRO, the qualified plan may pay benefits to a former spouse or another alternate payee in accordance with the terms of the order without violating the antialienation rule. It is this exception to the antialienation rule that allows state courts the ability to divide and reallocate retirement benefits in domestic relations actions.[2]

A Domestic Relations DRO may be a judgment, decree, or order made pursuant to a state domestic relations or community property law that relates to the provision of child support, alimony, or the property rights of a spouse, former spouse, child, or other dependent of a plan participant (referred to as an alternate payee). To be a QDRO, the DRO must, among other requirements, specify (1) the name and mailing address of the plan participant and each alternate payee, (2) the amount or percentage of the participant’s benefit to be paid to each alternate payee or how it is to be determined, (3) the number of payments or the period to which the order applies, and (4) the identity of each plan to which the order applies.[2]

The general rule of IRC 1041 is that transfers of property between spouses or former spouses incident to divorce are not taxable. This provision applies not only to transfers at divorce but after as well, provided the transfers are incident to the divorce.[3]
  • Six-year presumption. Transfers made pursuant to divorce documents within six years of divorce are presumed incident to divorce and not taxable
  • After six years. The reverse presumption—that transfers after six years are not incident to divorce and asre taxable —may be rebutted by presenting evidence to the contrary.
The nontaxable treatment applies to transfers of cash or property, the surrender of marital property rights, and the assumption of liabilities. It does not apply to assignments of income such as an accrued bonus or a right to income from rental property (unless ownership of the rental property itself is also transferred). This is the reason QDROs and EDROs are necessary to transfer pensions tax free.[]3]

Property settlement. Attorneys should also consider the tax consequences of transferring property between divorcing spouses. Generally, no gain or loss is recognized on transfers of property between spouses (or former spouses) incident to divorce—that is, transfers that occur within one year after the marriage is terminated or, if beyond a year, are nonetheless related to the cessation of the marriage.[4]

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[source]

[1]
Information for Clients in a Divorce Case,Contributed by Thomas L. Saxe,
ICLE ,11/11

[2]
Michigan Family Law ch 16 (Hon. Marilyn J. Kelly et al eds, ICLE 7th ed 2011), at
http://www.icle.org/modules/books/chapter.aspx?lib=family&book=2011553510&chapter=16
(last updated 01/18/2013).

[3]
Michigan Family Law Benchbook ch 9 (ICLE 2d ed 2006), at
http://www.icle.org/modules/books/chapter.aspx?lib=family&book=2006553550&chapter=09
(last updated 01/18/2013).

[4]
Michigan Family Law ch 18 (Hon. Marilyn J. Kelly et al eds, ICLE 7th ed 2011), at http://www.icle.org/modules/books/chapter.aspx?lib=family&book=2011553510&chapter=18
(last updated 01/18/2013).

Thursday, January 10, 2013

Your questions in Chapter 13 Bankruptcy by Flint Bankrutpcy Attorney Terry Bankert 235-1970


Your bankruptcy case number is very important! This is how the Bankruptcy Court and the Trustee’s office identify your specific case. You will need to put this number on all payments made directly to the P.O. Box in Memphis, TN. It will also be required if you contact the Trustee’s office with questions regarding your case, or if you would like to view your case information online.
If a neighbor, friend, family member, girlfriend, boyfriend, roommate, etc. calls the Trustee’s office and requests information regarding your case, we cannot give them information without your written authorization.
All the creditors listed in your Chapter 13 Plan have been sent a notice advising them of the filing of your bankruptcy case. They are subject to an Automatic Stay Order, which requires the halt of all collection activity on pre-bankruptcy debts. In the event that you are contacted, do not discuss your debt, but instead, give them your Chapter 13 case number and the name of your attorney. Get the name of the person contacting you and report it to your attorney.
Your first payment is due within 30 days after your bankruptcy is filed. Failure to make your first payment within 30 days of filing will result in the Trustee’s office filing a motion to dismiss your case. Please discuss all payment instructions with your attorney.
Payments to the Trustee are used to pay your attorney, Trustee fees, and your creditors. Creditors fall into three basic categories: secured, priority, and unsecured. Generally, the Trustee makes monthly payments to the secured and priority creditors first. After these creditors are paid in full, your payments are then divided among the unsecured creditors. Unsecured creditors may not receive payments for many months or even years.
If you experience a short paycheck/short pay period, you still need to make your full payment. Contact your attorney. They will advise you of your legal options – with your attorney’s help we may be in a position to assist you.
Payments are due even if you are on vacation, laid off or on sick leave. In the event that you can’t make the required payment, please contact the Trustee’s office immediately and make arrangements to pay “something” directly, until you return to work. Please keep records of any partial payments and upon return to work you will need to remit extra payments in addition to regular payments to cure the default. Also, contact your attorney. They will advise you of your legal options.
If payments are missed, it is possible that your expected completion date will change. Please keep records of any missed payments and remit extra payments in addition to regular payments to cure the default. NOTE: You cannot complete your Plan as originally proposed if you do not make all of your payments into the Plan!!
If you have a little extra money, DO NOT use it to pay creditors directly if they are to be paid by the Trustee. Contact your attorney to discuss your options – this office will continue to pay all of your creditors as court ordered unless otherwise informed in writing by either the creditor or attorney.
If you receive a bonus check, vacation check or a tax refund and a deduction or the whole check/amount has been remitted to the Trustee’s office to fund your Chapter 13 Plan- READ YOUR PLAN AND PAY ORDER – to find out if the deduction was correct. The Trustee has a duty to collect all funds and apply them to the plan unless there is an exception. All receipts are disbursed regularly. If a payment was received incorrectly, please notify the Trustee’s office immediately.
Only your attorney is to contact the Trustee’s office in writing to request payoff information. THE PAYOFF AMOUNT CHANGES WITH EVERY DISBURSEMENT. Please contact your attorney so that he/she can help you to determine if this is in your best interest.
It may not be in your best interest to pay off your case early. Contact your attorney to discuss your options.
The Plan will not work if payments are not received. If you have an interruption in employment, please contact the Trustee’s office. Keeping the Trustee informed can possibly avoid a motion to dismiss. However, creditors may still file motions if your payments are behind. Contact your attorney to discuss your options.
The Trustee will provide you with information on your Chapter 13 Plan and payments. You will receive an annual report in the mail and you can view your case information at any time online.
If you are entitled to a check from the Trustee’s office, you may NOT come pick it up in person. We mail all payments.
You must keep your attorney and the Chapter 13 Trustee’s office informed in writing of address changes. This information is not only useful for notices, but also to make sure that any checks payable to you are sent to the correct address.
Every debt you owe, contingent or disputed (business or individual), must be listed in your plan. All debts must be paid through the Trustee’s office unless there is justification stated in the Plan. If you have debts that you did not list, contact your attorney.
In order to be paid, creditors must file a proof of claim after receiving notice of your Chapter 13 filing. Unsecured creditors are allowed 90 days from the date of the first meeting of creditors (341 meeting) to file their claims. Governmental agencies have 180 days from the filing date of your petition to file a claim. If they fail to do so, they most likely will not receive payments into the plan.
Several months after the filing of your case, you will receive a document called the Report on Timely Filed Claims. This document lists all of the creditors in your plan and discloses whether or not a claim has been filed. Carefully check the listing for accuracy. CONTACT YOUR ATTORNEY IF ANY OF THE CREDITORS OR CLAIM AMOUNTS APPEAR INACCURATE.
If you have received a shut off notice, explore assistance from your church, charitable agencies, and contact your attorney. The Trustee cannot respond unless your attorney takes legal steps.
If you need repairs on your vehicle or home, contact your attorney and they will discuss your options.
All of your disposable income is considered part of your bankruptcy estate and must be committed to the Plan for the first 36 months. You cannot buy any major purchase without first obtaining the Trustee’s permission. This includes refinancing. Your attorney must submit the appropriate paperwork asking the Trustee to consider your request.
All of your property is considered part of your bankruptcy estate. You cannot sell any major part of the estate, including but not limited to: your home, car, land, fine art, or jewelry without the permission of the Court. Your attorney must submit the appropriate paperwork asking the Court to consider your request.
Any use of credit or credit cards, or entering into a loan agreement of any kind is prohibited by the Court. This applies to any family member that you support, even though they are not a party to your Chapter 13.
In emergency circumstances or if a unique need for credit use arises, contact your attorney to submit a Motion to Incur Debt which the Trustee will take into consideration. The Trustee will decide if the request has merit and is affordable. Pursuing credit without the Trustee’s permission may jeopardize your Chapter 13 case and could lead to dismissal.
If your Chapter 13 Plan includes a tax escrow to pay future property taxes while you are in bankruptcy, you will need to mail all tax bills to the Trustee’s office for payment at 400 N. Saginaw St., Suite 331, Flint, MI 48502. Be sure to include your name and case number on the bill. DO NOT mail them to your attorney’s office first.
The Trustee and his staff cannot give legal advice.
Your attorney is your best source of information. If you have questions, contact your attorney.
If you feel that your attorney is not providing adequate service and/or they are totally inaccessible, you always have the option of hiring a different attorney.
A case may be converted to a Chapter 7 voluntarily.A letter will be sent from our office to the employer and/or you (debtor) with directions to extinguish the payroll deduction, ACH or to direct you to stop personally paying. A close code has been entered in your case. This code directs our system to reject any further payments received after the conversion and to refund any payments received back to the debtor. Bear in mind it sometimes takes approximately 4 to 6 weeks for some employers to extinguish a deduction.
Any funds received prior to conversion are disbursed to your creditors pursuant to your confirmed plan.
A case may be dismissed either voluntarily, meaning that you decide to stop your participation in the plan, or involuntarily, meaning the Court has terminated your plan usually because of failure to maintain timely payments. If your case was dismissed, all creditor stays will be lifted and creditors may resume recovery procedures on accounts and may add any interest and penalties that were waived under your Chapter 13 Plan.
A letter will be sent from our office to the employer and/or you (debtor) with directions to extinguish the payroll deduction, ACH or to direct you to stop personally paying. A close code has been entered in your case. This code directs our system to reject any further payments received after the dismissal and to refund any payments received back to the debtor. Bear in mind it sometimes takes approximately 4 to 6 weeks for some employers to extinguish a deduction.
Any funds received prior to the dismissal are disbursed to your creditors pursuant to your confirmed plan.
Congratulations, you have successfully completed your Chapter 13 Plan. Your case has been audited and an Order is being entered with the U.S. Bankruptcy Court to extinguish the payroll deduction, ACH or direct you to stop personally paying. This Order is served to you (debtor), your attorney and your employer. A close code has been entered in your case. This code directs our system to reject any further payments received after the completion code has been entered and refund the payments back to you as the payments are received. It takes approximately 4 to 6 weeks for some employers to extinguish a deduction.
The final disbursement will take place on the 1st of the month following completion. After the final disbursement has taken place, a Notice of Completion is sent to you (debtor), your attorney and all your creditors. It instructs all parties that they have 30 days to respond. If they disagree to you receiving your Discharge, they are to file an objection with the U.S. Bankruptcy Court. After the 30 days expire, the U.S. Bankruptcy Court will issue your Discharge. Bear in mind that although you are financially completed you are still legally protected by the bankruptcy until you receive your Discharge. You may not buy or sell any items until you receive your Discharge. The time between completion and Discharge is approximately 2 to 3 months.
If this office was paying your mortgage payment, you will receive a letter from us directing you to start making your mortgage payment. We will indicate what month you are to start and the amount you are to start paying. You will need to mail your payments directly to the mortgage creditor according to the letter you receive. The mortgage creditor will not set up automatic payment until after you receive your Discharge.
Unique debts contained in your plan that cannot be discharged upon completion include student loans, child support obligations, and fines created as a result of your causing injury while under the influence of drugs or alcohol. You will be responsible for any balances due on debts of these types after the completion of your plan.
If your unsecured creditors did not receive the entire amount originally owed to them, all remaining balances will be “discharged” or legally forgiven upon the completion of your plan. Creditors cannot resume collection activity on these debts.
When a creditor has been paid in full through the plan, the creditor may upon your request, send the “paid in full” papers to you. Court records will officially show your plan was paid in full according to its terms and will overrule any claim the creditor might make for additional money from you. Should you receive a request for additional money after your plan completes, review the matter with your attorney.
Your Chapter 13 bankruptcy will be reflected on your credit report for ten years after the petition was filed with the Court.
A final report and account must be submitted to the Court for auditing before your case can be closed. Auditing usually takes four to six weeks. You will receive a copy itemizing all money transactions, receipts, claims filed, and amounts of disbursements. You will receive an Order of Discharge from the Bankruptcy Clerk and a copy of your Final Report. Your creditors will receive notice that the final report was filed. These are very important documents that you should keep in a safe place indefinitely.

Sunday, March 27, 2011

BANKRUPTCY WILL IT WORK FOR YOU

BANKRUPTCY LAW is Federal with some state exception variations. If you do not get it right when you file you could lose everything. Bankruptcy Lawyer Terry Bankert guides you awa from complications that can occur with sloppy pleadings. Contact Flint Bankruptcy Attorney Terry Bankert 810-235-1970 or through his web page at http://www.attorneybankert.com


Tuesday, March 22, 2011

IN DIVORCE THIS ADAM LOST TO EVE, WIFE GETS MORE PROPERTY.by FLINT DIVORCE ATTORNEY TERRY BANKERT

Flint Divorce Attorney Terry Bankert ,810-235-1970 discusses several Issues: 1.Divorce;


2.The defendant-husband's claim that the property division was inequitable; Pickering v. Pickering; Reed v. Reed;

3.The factors in Sparks v. Sparks; Berger v. Berger; Thames v. Thames;

4Infidelity; Davey v. Davey;

4Dissipation of martial assets; Woodington v. Shokoohi



SOURCE:Court: Michigan Court of Appeals (Unpublished 02/15/2011),

Case Name: S----- v. S-----, Livingston Circuit Court, LC No. 08-003892-DO

e-Journal Number: 48129,Judge(s): Per Curiam - Murphy, Murray, and Shapiro,

[Comments of Flint Divorce Lawyer Terry Bankert ALL CAPS or trb]



YOU HAVE A RIGHT TO APPEAL THE DECISION OF YOUR LOCAL DIVORCE COURT



A trial court’s factual findings will not be reversed unless they are found

to be clearly erroneous, meaning that, this Court is left with a definite and firm conviction that a mistake has been made. Reed v Reed, 265 Mich App 131, 150; 693 NW2d 825 (2005).



GOOD LUCK IF YOU TRY

A trial court’s dispositional ruling should be affirmed unless this Court is left with the firm conviction that the property division was inequitable. Pickering, 268 Mich App at 7.



HIGH COURT DECISION



The Michigan Court of Appeals held, inter alia, that an unequal division of marital property is not contrary to Michigan law as long as it is based on the appropriate criteria, the trial court properly determined the situation (after a 38-year marriage) did not warrant a 50-50 property division based on the property division factors, and the trial court did not err in awarding the plaintiff-wife $150,000 in alimony in gross.

The LIVINGSTON DIVORCE trial court used its equitable powers to mold relief according to the nature of the case and did what was necessary to accord complete equity and to resolve the controversy. The MICHGIAN COURT OF APPEALS concluded that reversal was not warranted as to the division of property.

HOW DOES A COURT MAKE A PROPERTY DIVISION?

In dividing the marital property, the trial court’s opinion here addressed the property division

factors set forth in Sparks v Sparks, 440 Mich 141, 159-160; 485 NW2d 893 (1992).

The Sparks Court stated:

We hold that the following factors are to be considered wherever they are

relevant to the circumstances of the particular case: (1) duration of the marriage,

(2) contributions of the parties to the marital estate, (3) age of the parties, (4)

health of the parties, (5) life status of the parties, (6) necessities and circumstances

of the parties, (7) earning abilities of the parties, (8) past relations and conduct of

the parties, and (9) general principles of equity. There may even be additional

factors that are relevant to a particular case. For example, the court may choose to

consider the interruption of the personal career or education of either party. The

determination of relevant factors will vary depending on the facts and

circumstances of the case. [Id. (citation omitted).]



HUSBANDS ARGUMENT-WIFE CAN WORK!

On appeal the defendant-husband argued the trial court made factual findings that were unsupported by the record - particularly that the wife might be unable to work in the future due to poor health,

HUSBAND ARGUES WIFE EQUALLY RESPONSIBLE FOR BAD INVESTMENTS

the defendant should bear the sole responsibility for bad marital investments and (indirectly) the balance on the equity line of credit,

HUSBANDS ARGUMENT- INFIDELITY NOT A BIG DEAL

and the LIVINGSTON DIVORCE trial court placed an inordinate amount of weight on his infidelity in dividing the martial assets.



…defendant complains that the trial court placed an inordinate amount of emphasis

on his affair and ordered an inequitable property distribution to punish him. A circumstance "to be considered in the determination of property division is the fault or misconduct of a party." Davey v Davey, 106 Mich App 579, 581-582; 308 NW2d 468 (1981). However, “the trial court must consider all the relevant factors and not assign disproportionate weight to any one circumstance.” Sparks, 440 Mich at 158.

HUSBAND CONTINUED AFFAIR WHILE IN COUNSELING WITH WIFE

The trial court found defendant’s affair to be significant in relationship to assessing defendant’s credibility. It is undisputed that defendant lied to plaintiff

about the existence of the affair, misled her about the termination of the affair, and participated in counseling with plaintiff while still engaging in the affair.

WIFE GETS $150,000

The court noted that the disparity in the property division was essentially created by the award to the wife of $150,000 in alimony in gross, given that the trial court otherwise evenly divided, for the most part, the marital estate.

DID YOU KNOW?

Woodington v Shokoohi, 288 Mich App 352; __ NW2d __ (2010) (when a party has dissipated marital assets absent the fault of the other spouse, the value of the dissipated assets can be included in the marital estate).



WHAT IS ALIMONY IN GROSS

If alimony, now referred to as spousal support, is either a lump sum or a definite sum to be paid in installments, it is alimony in gross, which is not truly alimony intended for a spouse’s maintenance, but rather is in the nature of a division of property. Staple v Staple, 241 Mich App 562, 580; 616 NW2d 219 (2000).

NO VALUE IN MARITAL HOME

There was no equity and was indeed negative equity in the marital home awarded to the wife, where its appraised value was surpassed by the mortgage and the balance on the home equity line of credit, which the trial court ordered the wife to pay.

ALIMONY TO PAY OFF LINE OF CREDIT

It appeared from the record that the trial court ordered the husband to pay alimony in gross so that plaintiff could use the funds to pay off the balance due on the line of credit, which nearly equaled the amount of alimony.

LIVINGSTON COUNTY DIVORCE COURT GOT IT RIGHT

On the record presented at trial, and given all of the circumstances in the case, there was no inequity in the trial court's decision. Affirmed.

DIVORCE PROPERTY DIVISION CAN BE UNEQUAL

An unequal division of marital property is not contrary to Michigan law as long as it is

based on appropriate criteria. Washington v Washington, 283 Mich App 667, 673; 770 NW2d 908 (2009). Here, the property division favored plaintiff; however, the trial court assessed the relevant factors, and the record supported such findings. Moreover, "there is no Michigan statute or caselaw that precludes outright a substantial deviation from numerical equality in a property distribution award." Id. In this case, the trial determined that the situation did not warrant a 50- 50 property division based upon the property division factors. The trial court did not err in awarding plaintiff $150,000 in alimony in gross. The trial court used its equitable powers to mold relief according to the nature of the case and it did what was necessary to accord complete equity and to conclude the controversy. Cohen v Cohen, 125 Mich App 206, 211; 335 NW2d 661 (1983).



If you have question about Divorce, custody , child support or bankruptcy call Flint Attorney Terry Bankert 1-810-235-1970

http://www.attorneybankert.com/


Saturday, March 12, 2011

FLINT BANKRUPTCY STEPS


Its  no joke being broke and bankruptcy is a way to a fresh economic start.  A Flint Bankruptcy  Lawyer can help you.After  you make the decision to file a  Bankruptcy Case —Here are the next steps
  • Once a bankruptcy case is filed, the Bankruptcy Court and the Bankruptcy Code impose a number of deadlines
    • Section 341 meeting of creditors—this meeting is held approximately 45 days after the bankruptcy case is filed. At this meeting, the debtor is placed under oath, and the Trustee (if the case is a Chapter 7 or a Chapter 13) or the United States Trustee (f the case is a Chapter 11) asks the debtor questions about its schedules, statement of financial affairs, and any documents requested by the Trustee ahead of time. Typically, debtors are required to provide the Trustee with bank statements, pay stubs, real estate documents and, if requested, credit card statements.
    • Creditors typically have 90 days after the date of the 341 meeting to file claims against the debtor (in Chapter 11 cases, especially if they are large, the debtor often requests a longer period of time)
    • Creditors have 30 days after the date of the 341 meeting to object to an individual debtor’s exemptions.
    • Creditors have 60 days after the date of the 341 meeting to object to the discharge of a particular debt or to object to the debtor’s discharge (in a Chapter 7)
    • In a Chapter 11 case, a debtor has 120 days after the case is filed to file its proposed disclosure statement and plan of reorganization. If the Chapter 11 debtor does not extend this deadline and fails to file a plan, then the debtor’s exclusive right to propose a plan terminates and any creditor may then file a proposed plan and disclosure statement
  • In a Chapter 7 case, after the 341 meeting, the Trustee typically investigates the debtor to determine if there are any undisclosed assets or any non-exempt assets to administer. If there are, the Chapter 7 Trustee typically begins any sales during this time. If there are not, the Chapter 7 Trustee files a “no asset report”.
  • In a Chapter 13 case, the Chapter 13 plan is filed with or shortly after the petition. The Chapter 13 Trustee and creditors use this next period to evaluate the plan and determine whether to object to it. If no objections are filed, or if all of them are resolved, the case is “fast tracked”, the confirmation order is entered without a hearing, and the debtor begins making payments into the plan. If there are unresolved confirmation objections, then a confirmation hearing is held and the Bankruptcy Judge determines whether the plan meets the requirements of the Bankruptcy Code and can be confirmed or whether it does not.
  • In a Chapter 11 case, depending on its size, the time after filing can be quite frenetic. The debtor often files a number of “first day” motions, which ask for various types of relief (for example, the ability to pay certain “critical” vendors, the ability to pay employees, the ability to stop utilities from shutting off service and the like). These motions are often heard approximately 20 days after the case is filed. In addition, the Chapter 11 debtor uses this time to evaluate whether it should assume or reject various leases and contracts, and to prepare financials and a business plan that will support the filing of a plan of reorganization. If the debtor intends to use the Chapter 11 to sell its assets and liquidate, the debtor often files a motion for approval of the sale of its assets during this time.

Sunday, November 14, 2010

WHAT IS SEPARATE PROPERTY IN A DIVORCE?

DID YOU KNOW the definition of Separate Property?


DIVORCE LAW IS FILLED WITH WORD OF CLOUDY MEANING.


Words like “marital property” lack statutory definition, so  does  “separate property”. A question your  divorce attorney will have to ask is when does  a  valuable asset become  characterized as separate property, as well as the starting point when identifying property per Reeves. An easy definition is that  separate property is the  flip side to marital property, and is generally not subject to division between the parties.


Terry Ray Bankert is a Michigan Attorney specializing in Family Law, and works as a Flint Divorce Attorney, Flint Divorce lawyer, Genesee Divorce Lawyer and Genesee Divorce Attorney.(SEO) For help with your questions call 810-235-1970. Or http://www.attorneybankert.com/  . Principle Source ICLE 09/16/10



So when do we havs Satutory Authority to Invade  or take Separate Property

The two statutory exceptions are a §401 “contribution” claim, and a §23 “insufficiency” claim (MCL 552.401 and MCL 552.23).

These two statutory exceptions are set forth below.

The first exception, a §401 “contribution” claim, is:

The circuit court of this state may include in any decree of divorce or of separate maintenance entered in the circuit court appropriate provisions awarding to a party all or a portion of the property, either real or personal, owned by his or her spouse, as appears to the court to be equitable under all the circumstances of the case, if it appears from the evidence in the case that the party contributed to the acquisition, improvement, or accumulation of the property. The decree, upon becoming final, shall have the same force and effect as a quitclaim deed of the real estate, if any, or a bill of sale of the personal property, if any, given by the party’s spouse to the party.


The second exception, a §23 “insufficiency” claim, is:

Upon entry of a judgment of divorce or separate maintenance, if the estate and effects awarded to either party are insufficient for the suitable support and maintenance of either party and any children of the marriage as are committed to the care and custody of either party, the court may further award to either party the part of the real and personal estate of either party and spousal support out of the real and personal estate, to be paid to either party in gross or otherwise as the court considers just and reasonable, after considering the ability of either party to pay and the character and situation of the parties, and all the other circumstances of the case.


Reeves implicitly overruled an earlier line of cases which held that separate property was simply another factor to consider when fairly dividing the entire estate. Because of Reeves and its progeny, general principles of equity do not constitute a sufficient reason for the invasion of separate property under either statutory exception. See, for example, Schneider v Schneider, unpublished opinion per curiam of the Court of Appeals, issued October 28, 2003 (Docket No. 245578) slip op pp 2–3.

C. Burden of Proof

There are no reported cases that expressly define which party bears the burden of proof in a separate property claim. However, it appears from the cases that the owner-spouse must prove a separate property claim in order to keep the property separate, and the nonowner-spouse must prove a statutory exception on order to justify invading the separate property.


These separate property claim frequently occurs in second marriages involves the ownership of a home by one of the spouses at the time of the marriage. In that case, establish both the fair market value of the home (and, therefore, the equity of the owner-spouse) at the time of the marriage, as well as the current fair market value of the home. All qualified real estate appraisers have access to historical records to adequately prepare an appraisal report for the value of a home even decades in the past.

Here are some examples of Separate Property

A. Premarital Property



Premarital property, that is, property a party owned before the marriage, is separate property. Reeves, Lee, and Korth v Korth, 256 Mich App 286; 662 NW2d 111 (2003).



B. Property Acquired During Cohabitation



Property acquired during cohabitation is separate property. Reeves. The footnote, which in one fell swoop created critical law in this area, is worth reproducing in these materials:



Rather than focusing on the four years the parties had been married, the court said it was equitably considering the parties to have been married for eight years. This was error. Michigan does not recognize common-law marriages. Carnes v Sheldon, 109 Mich App 204, 211, 216–217; 311 NW2d 747 (1981). Cohabitating with someone is not the same as marrying them. Further, Bone, supra, required the court to look at the period that began with the marriage. A court is not free to expand this period to include any cohabitation that may have occurred before the parties marry. Reeves at 493 n 1.[10][Emphasis supplied.]


What Reeves is to property, Korth is to spousal support. The Korth court’s rationale was stated as follows:


Although the past relations and conduct of the parties is one factor the trial court may consider in determining whether to award spousal support, Michigan has a strong public policy supporting the institution of marriage…. This policy was undermined by the trial court’s holding in the present case. The trial court was required to limit its consideration to “the length of the marriage,” not the length of the relationship, in awarding spousal support.

C.Inherited Property



Inherited property is, at least where it has been kept separate from marital property, is generally treated as separate property. Lee, Dart, and Wells v Wells, unpublished opinion per curiam of the Court of Appeals, issued November 20, 2007 (Docket No. 271465) (parent’s conveyance to son of family farm deemed “pre-inheritance transfer”, thus separate asset).



D. Gifted Property



Gifted property, at least that which is intended for the donee-spouse only, has traditionally been considered separate property. Brookhouse v Brookhouse, 286 Mich 151; 281 NW2d 573 (1938); Hackert v Hackert, unpublished opinion per curiam of the Court of Appeals, issued May 5, 1995 (Docket No. 153308) (jewelry and part of a doll collection given to W by H during the course of the marriage were items of personal use or adornment, and therefore separate property of the recipient spouse); and Francis v Francis, unpublished opinion per curiam of the Court of Appeals, issued June 13, 1995 (Docket No. 150780) (H’s gift to W of a diamond engagement ring was W’s separate property). But, see Hance v Hance, unpublished opinion per curiam of the Court of Appeals, issued August 21, 1998 (Docket No. 200684) (interspousal gifts of jewelry deemed marital property).



E. Damages for Pain and Suffering



Pain and suffering awards in the context of personal injury cases are separate property (as opposed to economic losses covering the time of the marriage). Bywater v Bywater, 128 Mich App 396, 398; 340 NW2d 102 (1983); Lee at 79; and Stoudemire v Stoudemire, 248 Mich App 325, 339; 639 NW2d 274 (2001). But, see Pickering v Pickering, 268 Mich App 1; 706 NW2d 835 (2005) (lawsuit proceeds deemed marital asset where both H and W were plaintiffs [H injured riding bicycle; W loss of consortium], joint check issued and deposited to joint account, and parties treated the settlement proceeds as a joint marital asset).



F. Pre/Postmarital Retirement Benefits



Although presumptively separate property, premarital pension benefits may be treated as part of the marital estate, per Booth v Booth, 194 Mich App 284, 291; 486 NW2d 116 (1992), and pension contributions made post-divorce are assets which may be considered part of the marital estate, per Boonstra v Boonstra, 209 Mich App 558, 563; 531 NW2d 777 (1995).



A thorny question arises when a portion of a defined contribution plan, such as a 401k, was accrued prior to the marriage, but investments in the plan continued during the marriage. It is easy to identify the account balance at the time of marriage and return that to the contributing spouse as his/her separate property upon divorce. But does that, without more, shortchange the contributing spouse by denying him/her the benefit of earnings during the marriage on those premarital contributions? With sufficient economic data or testimony, it should be possible to segregate earnings on premarital contributions (which in theory are separate property) from earnings of contributions made from income during the marriage (which is clearly marital property). Yet this approach was rejected recently by the Court of Appeals in the unpublished of Skinner v Skinner, Court of Appeals No. 289740, decided 5/18/10.[11]



Drafting Tip: The language used in Booth and Boonstra to describe the process of awarding a portion of separate property to the nonowner-spouse, “treated/considered”, is not technically correct. Frankly, sloppy use of language creates confusion. Purists, like James P. Ryan, Esq., of Plymouth, point out that the proper language is, instead, “invaded/divided”.



G. Why It Matters - Invasion of Separate Property



Notwithstanding a characterization of an asset as “separate”, the tenacious and creative practitioner will find case law on both sides of most of these issues. Other legal concepts like “commingling” may destroy the separate nature of an otherwise separate asset, and thereby permit the court to treat the asset as marital property.



The cases are obviously fact-intensive, and much depends on the development of the proofs. The key is to understand that a marital asset is subject to division using the equitable factors found in Sparks, while a separate asset may only be divided if either of the statutory exceptions is met.



A. Motion for Partial Summary Disposition pursuant to MCR 2.116 when dealing with separate property claims, particularly when a §23 “insufficiency” claim is not asserted. You educate the court on your claim (either that the asset is separate or marital), and a ruling either way should greatly assist in resolving the case.



Defining the marital estate is not easy. Neither is defining what “marital” and “separate” property are. Ultimately, it is a matter of advocacy, that is, persuading the fact-finder based on knowledge of the law and what makes common sense in a particular fact-pattern. The intent of these materials is to make you a better advocate




Terry Ray Bankert is a Michigan Attorney specializing in Family Law, and works as a Flint Divorce Attorney, Flint Divorce lawyer, Genesee Divorce Lawyer and Genesee Divorce Attorney.(SEO) For help with your questions call 810-235-1970. Or http://www.attorneybankert.com/ . Principle Source ICLE 09/16/10

Tuesday, July 13, 2010

Domestic Violence

Flint Divorce Lawyer talks about The Mel Gibson domestic violence case as a classic example of what happens in private from publicly looking responsible people who engage in domestic violence.


BITTER CUSTODY FIGHT, IS THIS AN EXCUSE?

Gibson, 54, and Grigorieva, 40, are now locked in a bitter custody dispute and the superstar facing domestic abuse allegations and the fallout from leaked audiotapes in which Gibson berates and threatens Grigorieva during profane rants. [1]

DEATH THREAT

On a new recording released today, 07/12/2010, Mel Gibson allegedly threatens to "bury" the mother of his child. Although just one listen and it's clear the actor's digging his own grave.[3]

TAPES RELEASED
A source close to the case claims the tapes were recorded in February on the heels of a heated exchange in January. [1]

WAS MOM SHAKING THE BABY?

Both sides agree they argued in January but differ on what exactly transpired. Grigorieva claims Gibson punched her in the face "more than once," breaking a tooth and knocking out a veneer. Another Gibson source says the actor only "tried to stop [Oskana] from shaking their baby like a ragdoll" during the altercation. [1]

ANOTHER HOLLYWOOD IDOL IN DOMESTIC VIOLENCE, MEL IS NOT ALONE.


Charlie Sheen's hearing for domestic violence, which was scheduled to begin today, has been delayed until August 2, 2010 -- just as filming for the new season of Two And A Half Men is due to begin.[4]


IT’S A PATTERN OF BEHAVIOR

Domestic violence ,said Flint Divorce Attorney Terry Bankert ,is a pattern of behavior in
which one intimate partner uses physical violence, coercion,
threats, intimidation, isolation or emotional, sexual
or economic abuse to control the other partner in the
relationship.

PERSONAL CHOICE, HABIT?



Domestic violence occurs when one household member chooses to use a pattern of physical assaults, threats of violence, and emotional abuse to maintain power and control over another. All 50 states have statutes authorizing courts to issue orders of protection to domestic violence victims. [5]



IS PPO AN OPTION?

In Michigan, a victim of domestic violence may obtain a personal protection order (PPO) to enjoin abusive behavior. PPOs may enjoin specific actions, such as assaulting, attacking, beating, molesting, stalking, or wounding the petitioner. In addition, they may prohibit entering specific premises, usually including the petitioner’s home and place of employment. They may also prohibit the removal of minor children from the legal custodian, purchasing or possessing a firearm, and any other act that interferes with the petitioner’s personal liberty or that causes a reasonable apprehension of violence. [5]





DOMESTIC VIOLENCE IS MORE THAN POOR COUPLES HITTING EACH OTHER



A divorce Attorney points out Domestic violence does not necessarily
involve physical violence and it equally affects all
aspects of our society, rich or poor, regardless of race,
ethnicity, religion or national origin.

DOMESTIC VIOLENCE IS WIDE SPREAD
Domestic violence is an epidemic. One out of nearly
every three women will be the victim of domestic violence
in her lifetime. Between three and ten million
children are exposed to domestic violence every year
and that exposure has a negative impact on their development.

HOLLYWOOD KEEPS DOMESTIC VIOLENCE QUIET

when it comes to Mel Gibson, who seems to have offended everyone possible with his racist, sexist, anti-Semitic, and outright terrorist rants in the tapes that have been “leaked” to the world over the past week, Hollywood seems to be keeping its usually highly-opinionated mouth closed.[2]





SPOUSES ARE AWARE OF HOW BAD THEIR ACTIONS ARE

The troubled state of his relationship with girlfriend Oksana Grigorieva was not lost on Mel Gibson. "He realized how unhealthy the relationship was and recognized that they were in a bad place and he was getting his buttons pushed," a friend tells [1]



WHAT ARE EXAMPLES OF DOMESTIC VIOLENCE

Domestic violence is defined as a pattern of behavior used to establish power and control over another person through fear and intimidation, often including the threat or use of violence. National Coalition Against Domestic Violence, at http://www.ncadv.org. In addition to physical violence, abusers may use many forms of control against their partners, including

isolation from friends and family;

verbal abuse (belittlement, taunting);

intimidation (destroying property, abusing pets, displaying firearms);

economic abuse (controlling access to money, preventing or interfering with employment);

coercion (threatening to commit suicide or to report incidents to protective services);

use of the children (harassment during parenting time, threatening to kidnap the children);

sexual abuse; and

stalking.[5]







DOMESTIC VIOLENCE CAN MOVE FROM SPOUSE TO CHILDREN


Moreover, studies indicate that forty to sixty
percent of men who abuse women also abuse children



Posted here by

Terry Bankert

http://attorneybankert.com




[1]

http://www.people.com/people/article/0,,20401383,00.html

[2]

http://www.foxnews.com/entertainment/2010/07/13/isnt-hollywood-outraged-mel-gibsons-racist-sexist-rants/

[3]

http://ca.eonline.com/uberblog/b189914_death_threats_admission_of_violence.html

[4]

http://www.examiner.com/x-36751-Canada-Celebrity-Headlines-Examiner~y2010m7d12-Charlie-Sheen-hearing-delayed-until-August--filming-jeopardized



[5]

Michigan Family Law ch 18 (Hon. Marilyn J. Kelly et al eds, ICLE 6th ed 2004), at http://www.icle.org/modules/books/chapter.aspx/?lib=family&book=2004553510&chapter=18

(last updated 07/02/2010).