UPDATES IN MICHIGAN FAMILY LAW

Judgment amended to correct error or omission

Michigan’s court of appeals decided in an unpublished opinion that the trial court committed error by not permitting Husband to amend a consent judgment of divorce to add language that the payments would terminate upon Wife’s death and would therefore qualify as deductible alimony.

In this case, as sometimes occurs, H was to make payments to W, taking advantage of Section 71(b) of the Internal Revenue Code. Often property settlements are paid out in installments, and it is advantageous to shift income from the party in a higher tax bracket to the party with a lower tax rate.

Depositions | Helpful tool in some divorces cases

James J. Harrington, III, an outstanding family lawyer from Novi, Michigan offers this valuable advice about discovery depositions in family law cases:

Depositions are certainly not required in every case or even most cases or even 70% of cases… however as to the remainder they are absolutely critical, mandated, and – arguably – the standard of practice requires them.

Before noticing a Deposition, I consider on a case by case basis the following:

Cohabitation - Finally, a test for trial courts to apply

On March 18, 2008, In Smith v Smith, decided (For Publication), the Michigan court of appeals adopted the test from an Ohio decision to determine what constitutes “cohabitation.” In Smith, the parties' consent judgment of divorce mandated termination of spousal support upon “cohabitation.” Mr. Smith filed a motion to terminate alimony, claiming that his ex-wife was cohabiting with another man. The trial court denied his motion, after carefully analyzing whether the ex-wife's conduct as described constituted "cohabitation." Mr. Smith appealed.

Alimony | Imputing income & impeachment

In Andrews v Andrews, decided by the Michigan court of appeals on March 11, 2008, Husband claimed that the trial court erred in not enforcing a prenuptial agreement that limited alimony to his net income as reflected by his federal tax returns. The trial court imputed income of $300,000/year to H after he transferred his interest in a partnership to his parents, allegedly to repay a $340,000 debt to them.

H wanted the trial court to believe that his transfer of the interest to his parents, which had been reduced to a sum certain in a default judgment, was not a voluntary or bad faith reduction in income that justified imputation. He also claimed that since Wife had not produced evidence directly impeaching his testimony, the trial court had to believe his testimony.

Treatment of "pre-inheritance transfer" of property in divorce

In Wells v Wells, Docket No 271465, decided on November 20, 2007, the COA upheld the Ottawa County Circuit Court where W challenged the T/C's distribution. 

W appealed the T/C's exclusion from the marital estate of H's partnership interest in a "Family Farm" that was owned and operated by H and his brothers. The COA characterized this property a pre-inheritance transfer from H's parents to their sons, which should be treated just as inheritances are by the T/C. The COA concluded that the T/C properly ruled that the partnership and his stock in the partnership formed with his brother was H's separate property and was properly excluded from the marital estate.

Income-averaging to calculate child support

Interesting reading today in the slip opinions from the Court of Appeals (COA). In addition to some interesting support issues, the property issue was also an interesting read.

In Griffin v Griffin, Docket No. 271194, an Oakland County case, Husband appealed the property division, disputing the trial court's ("T/C'") award of a stock account and 60/40 distribution of a bank and annuity investment, while giving H 100% of his various businesses.

The COA noted that the T/C found H's business appraiser not credible. In addition, the T/C offered to split everything (including the businesses) 50/50, and H declined. Hmmm. What does that say about H's idea of the value of his businesses?

H also found fault with the calculation of child support, which he said was inflated.

Permanent spousal support?

In many divorce cases, the issue of whether one of the parties is entitled to an award of spousal support / alimony arises. If it appears that the trial court might grant a request for alimony, the next question is: "How long might that alimony award last?" Part of the answer to those questions is: "The trial court's decision is dependent upon the specific facts of your case."

In Michigan, appellate court decisions establish that trial courts will apply 11 factors when deciding whether spousal support should be awarded and the amount of such an award. These factors are:

"Fault" after the fact doesn't negate an alimony award

This is a pretty strange case . . . reminds me a little of the "War of the Roses."  The Missouri Supreme Court ruled recently that even though a woman tried to have her ex-husband  rubbed out, he still must continue to pay alimony to her.

These are the facts:

• In the course of divorce proceedings, the spouses entered into a non-modifiable agreement. Husband agreed to pay monthly spousal support to Wife.
• The divorce was finalized.
• The the ex-wife attempted to hire a hitman to kill her ex-husband.
• The ex-husband discovered and thwarted the planned "hit."
• The ex-husband asked the court to terminate his alimony obligation.
• The Missouri Supreme Court ruled that the ex-husband had agreed that the spousal support would not be changed "regardless of the relative circumstances of the parties." As a result, the ex-husband remains liable for the spousal support despite the fact that if the ex-wife's plan to have him killed had succeeded, his death would have terminated his spousal support obligation.

See  Richardson v Richardson, 218 S.W.3d 426 (Mo. 2007).

Court of Appeals: Infidelity alone doesn't negate alimony award

Where the trial court, in denying alimony, focused only upon the defendant wife's infidelity, her failure to admit her infidelity, and her unjustified attempts to make her husband look like a bad man, the Michigan Court of Appeals held it was reversible error to focus on only 1 of the 12 factors used in determining spousal support.

The COA also reversed the trial court's denial of the wife's request for attorney fees.  See Berry v Berry, Docket No. 273427, decided July 24, 2007. Unpublished.

Technorati tags: alimony, spousal support, infidelity

What should you know about alimony?

There is often confusion about what alimony is, about when and in what amount it might be ordered, about how long alimony might be payable, and whether or not it’s modifiable. As you can imagine, given the number of possibilities, an answer to some of these questions can be pretty complicated.

Let’s start with the obvious, though. Whether or not alimony (spousal support) will be ordered by a court is entirely dependent on the specific facts of each case.

What does the judge look at when deciding whether to award alimony, how much and for how long?

In Michigan, there are several factors that the judge will consider when deciding if an alimony award. These factors are similar to those used by judges in states other than Michigan. Among the factors a court may consider are these:

How sanctions can defuse scorched-earth litigation tactics

Yesterday on the Michigan Family Law Section's Listserv, Judge Hammond stated in response to a query about the award of sanctions for bad faith pleading / litigation:

"An old - but still solid - rule is "follow the money".  The pocket-book nerve is the second most sensitive nerve in the human being.  (The kid nerve comes first, in normal people.) Making a client (and even more so, an attorney) pay money for his or her sins is a very effective way of getting someone's attention."

Just prior to his death, Greg Justis sent me an opinion from a case before Judge Johnson in Emmet County.

When is It Proper for a Court to Impute Income When Awarding Alimony

Clients are often dismayed when a trial court imputes income when making an award of child support or alimony / spousal support.  Explaining to the layperson that "imputing income" means that the court assumes that the person could make the same salary or wages that he or she was making in a previous employment if they wanted to doesn't make a client any happier.

What about husbands or wives who have lost their jobs and who are still looking for work? When is it fair and equitable to impute income to them, and what percentage of their actual wages can be ordered as alimony payments?

On February 16, 2006, the Michigan Court of Appeals said imputing income to a husband who had been laid off for that an award that gave the wife 60% of her former husband's gross earnings was unfair and "clearly inequitable".

The Impact of COBRA Payments on an Alimony Award

On January 19, 2006, the Michigan Court of Appeals decided in an unpublished opinion that a trial court has to consider the needs of the parties and their ability to pay when ordering a party to make the COBRA payments for an ex-spouse.

In Murphy v Murphy, the defendant husband appealed the trial court’s award of three years of COBRA benefits to plaintiff wife. The trial court had awarded alimony to her in the amount of $300 per week. Together with the child support, the husband would thus pay nearly 50% of his after-tax income to her before the cost of the COBRA benefits was even considered.