After divorce update your estate plan and survivor provisions for assets

A divorce judgment will allocate assets between the spouses. This property division will address all assets owned by either party or both party without regard to the title prior to the divorce.  In many instances the final judgment will allow some or all assets to be allocated to the party who owned the asset prior to divorce.  Many of these assets will have contract terms that contain payable on death clauses.  Typically these payable on death clauses are paid to the surviving spouse. 

After a divorce, each spouse should examine all assets allocated to them and review the payable on death clauses.  In particular, life insurance policies, retirement accounts, pensions, investment accounts, and bank accounts should all be examined.  If the divorce decree requires death designations then there is a specific duty to conform to the requirements of the judgment.  If the decree is silent on death designations then each spouse is free to change the death designations to any person they want.  However, if a person still wants to make their ex-spouse the death beneficiary then extra steps must be taken.

Massachusetts law treats any death designation to an ex-spouse as revoked upon divorce.  This means that if a person wants their ex-spouse to receive death benefits they must take some action, after divorce judgment issues, to reinstate the death benefit.  I recommend that if a person wants their ex-spouse to continue to have death benefits that they state so in a will.  In addition, they should notify the trustee of the asset (life insurance company, brokerage firm, bank, etc.)  that they are ratifying the death benefit designation.  If a person does not write a will after a divorce then they should write their intention in a document that can be signed before a notary public.

If these steps are not taken, then the assets are not likely to be distributed as desired after death.  In addition, there is an excellent chance that litigation will be filed to determine who gets the asset after death.

It is strongly recommended that everybody who gets divorced should consult a lawyer and execute a will after the divorce. 

How to make property division in a divorce easier.

There is no greater waste of money in a divorce than fighting over divisionof small personal property owned by a couple. The attorney fees spent to argue over beds, sofas, kitchen table, tvs, and other household items usually exceed the value of the items. A dining room set purchased for $5,000.00 may be valued in a divorce at $300.00. As used furniture, the set may only be sold at a garage sale. Most household furniture is valued based upon what can be realized for the asset at a garage sale. It is simply cheaper to go out and buy an equivalent item than to pay attorneys to fight over it. Of course, higher value items such as house, retirement accounts, investment accounts, and collections are worth the cost of paying for appraisers and attorneys. I suggest that the parties approach division of household items with consideration of the following issues.

If there are children, the children should be given priority. The children's furniture should remain with the parent who has more parenting time than the other. The rest of the furniture in the house should also take into account the children. If there is only one tv it should remain in the house with the children. If there are two tvs then the parent with the children should get the better tv.

Most households currently have a car for each parent. Unless a car is a collector's item, each party needs a car to function in today's society. In almost all cases, judges award the cars to the party who primarily drove each car prior to separation. Cars are generally viewed as a necessary tool and not as an asset.

Both parents should try to be fair about division of household items. Any unfairness is usually met with a large increase in attorney fees. The problem is that the parent who doesn't get the household items needs to go out and purchase new items. The need to make such purchases as well as a rental security deposit and last month rent should be recognized and money should be set aside for these expenses. Treating each other fairly means that both parents end up with adequate furniture and living arrangements. This can be accomplished by possession of existing items or money to buy replacement items.

Parties need to identify items of sentimental value to the two parties and cooperate to allocate the sentimental items to the appropriate party. Family heirlooms should go to the party who broguht the item into the marriage. Again, the countervailing value is money set aside to purchase a replacement item.

Items that are only used by one party should be offered to that party. A riding lawn mower that had been used exclusively by the husband may never be used by the wife who intends to hire a service to mow the lawn. If the wife sells the mower without the husband's permission it will be a violation of the automatic restraining order and have the effect of a declaration of war that will cause the husband to fight over trivial matters. Giving the husband opportunity to take the mower or have both parties sell the mower and divide the proceeds will result in a better attitude from both parties. 

Pictures and videos are frequently the subject of litigation. It will save money if the parties pay to have the pictures duplicated so that each party can have a set. Sometimes the parties will agree to purchase a scanner so that one party can copy all pictures and give the originals to the other.

Division of personal property can be a huge drain of financial resources if the parties choose to fight over the assets. This large expense is seldom worth the money required to have the judge resolve the division. An experienced divorce attorney should be consulted to learn how the law applies to your case and to look for an inexpensive logical solution to property division.

Separation agreements can't contract away bankruptcy protections

I recently negotiated a separation agreement in a divorce in which the opposing attorney insisted on inserting a clause that on its face prevented the parties from receiving the benefit of bankruptcy laws if one of them filed a bankruptcy petition in federal court. The clause that she tried to insert was as follows:

"Each Party agrees that neither shall attempt in any way to discharge any obligations contained in this Agreement in bankruptcy proceedings, and that in the event that s/he does, any discharge in bankruptcy for any such obligations shall have no effect upon his/her responsibility as contained in the Agreement. The obligations of the Parties set forth in this Agreement shall survive and supersede any subsequent discharge in bankruptcy. The filing Party shall indemnify and hold harmless the non-filing Party from any and all losses suffered as a result of the bankruptcy proceeding, including costs and legal fees."

In my opinion, this clause is illegal in that it violates federal law and is unethical because it misleads the parties and can cause them to litigate frivolous issues in the event of a bankruptcy filing by a party.

Bankruptcy law is established by federal law. While it may incorporate state law and even look to state law for various elements of the overall bankruptcy scheme, on the issue of a party's ability to file bankruptcy and the effect of filing a bankruptcy petition, these are within the exclusive jurisdiction of federal law. State court judges in family court have no ability to take away a party's right to file bankruptcy or to restrict the effect of such a filing. The parties also lack the power to contract away bankruptcy rights. If an individual could contract away bankruptcy rights then every contract would contain an anti-bankruptcy clause.

In some regards, bankruptcy law protects obligations created by Family Court in a divorce. Child support and alimony are domestic support obligations which are protected categories of debt. Property division does not receive protection under bankruptcy law. The proposed clause does not effect child support or alimony as these are already protected would not be effected by a contract clause that caused separation agreements to survive bankruptcy. This clause is aimed solely at property division.

In the case of In re Kroen, the court addressed a similar clause. The court found that the clause violated bankruptcy law and could not be enforced. The court found that this clause violated public policy. There are are long line of federal cases that hold that an agreement to make contracts non-dischargeable in bankruptcy are void as they all offend the public policy of promoting a fresh start for individual debtors.

Since the proposed clause is illegal and void under bankruptcy law, it can never be given any enforcement in either state or federal court. As such, the only possible purpose of the proposed clause is to make the parties think that property division in a divorce is non-dischargeable under bankruptcy law. In other words, the purpose is to mislead the parties into an incorrect understanding of the law. This is a violation of the ethical rules that lawyers follow.

The Rules of Professional Conduct for Lawyers prohibit lawyers from engaging in conduct involving dishonesty, fraud, deceit or misrepresentation or conduct that is prejudicial to the administration of justice. The proposed clause would mislead parties into thinking that they can file litigation in bankruptcy court and prevent the discharge in bankruptcy of property division obligations. Such a misleading action is conduct that involves misrepresentation. Since it encourages frivolous litigation it is also prejudicial to the administration of justice.

Drafting a separation agreement is a complicated process. People getting divorced should consult an lawyer experienced in family law before signing a separation agreement.

Prepare for a divorce—create a household inventory

In most cases, people anticipate a divorce before it happens. While some actions taken before a divorce can receive an adverse reaction from a spouse, creating an inventory should not. Creating an inventory can be helpful in case you suffer an insurance loss such as fire, theft, or flood. An inventory can also be helpful in a divorce.

In a divorce the two spouses will have to divide the household belongings. Sometimes this occurs leisurely and sometimes in a rush. An inventory will make a split easier. If a court issues an order removing one party from the house having an inventory will make it easier for that person to receive a fair distribution of the household assets. If you are dividing items from memory you are likely to forget items that you care about.

Another benefit of having a household inventory is to reduce the potential for items to disappear. After a person who is out of the house takes their initial list of items it is much more difficult to obtain items from the house. That book that you received from your grandmother is likely to be thrown out if you don't retrieve it in the initial group of items. With digital photography you can incorporate photographs into your inventory.  By having a list you can designate items to retrieve later and avoid having them thrown out or sold.

The earlier you start the inventory the better off you are. It is also helpful to consult an experienceddivorce lawyer as early as possible. Both an inventory and a divorce lawyer can help you work through the difficult times created by a divorce.

What will the Court do in a divorce when I prove that my spouse cheated?

Discovering that your spouse has been unfaithful can be an emotional disaster. To many people, this is a wrong that can never be corrected. It can destroy a marriage. People expect that infidelity will be punished by a Judge in a divorce and the innocent spouse will be rewarded by a favorable property division or alimony as a result. Some people think that a person who commits adultery should not have custody of children. While the actions of the courts vary depending on the specific facts of a case, usually, a Massachusetts Court will do very little when adultery is proved.

Grounds for Divorce

Massachusetts is a no-fault divorce state. There is no advantage to filing a fault grounds divorce if the other party will appear in the divorce action. While Massachusetts allows a divorce on the grounds of adultery, Judges will encourage parties to change the divorce to no-fault. If a divorce is filed on the grounds of adultery, a motion must be filed to name the third party who participated in the infidelity. Judges will deny this motion as soon as it is filed.

Alimony and Property Division

Alimony and property division in a divorce require a Judge to consider many factors. There is no factor specifically addressing marital fidelity. One of the factors is "conduct of the parties during the marriage." Certainly cheating should be considered wrongful conduct. However, it is hard to imagine a marriage where the only conduct by one party was bad conduct. Usually every person has good conduct and bad conduct during a relationship. The Judge must consider all conduct, good and bad. As a result, it is rare that a person has behaved so badly during a marriage that it has a significant affect on the outcome. Massachusetts divides marital property under a concept of equitable division. I have never heard a Judge describe any part of equitable division as including the concept of punishing a party for bad behavior.

Sometimes when Infidelity occurs one spouse has established an on-going relationship with a third party. Sexual infidelity may be a part of this relationship. Another part of the relationship may be using marital resources to benefit the third party. Expensive gifts or trips can constitute a diversion of marital assets. If spending of substantial money to conduct the affair or benefit the paramour occurred, then a Judge may be expected to take the expenditure into account when dividing assets. It is not the sexual acts that impact the property division, it is the spending of money.

Child Custody and Child Support

The standard for deciding custody is “the best interests of the child.” If the affair was unknown by the child and had no effect on the child, then the Judge should not consider the affair when deciding child custody or visitation. Although it is predictable that the paramour may be exposed to the child in the future, unless there is evidence of inappropriate sexual conduct occurring in the presence of the child, the Judge should not let an affair control a custody decision.

Child support is decided by application of the child support guidelines. Once child custody is determined, child support will follow. An affair is not related to the child support guidelines.


An affair may violate societal and religious morals. However, in most cases, it has almost no effect on an divorce. Of course, each case is fact specific and if your spouse has committed adultery you should consult an experienced family law attorney to discuss what effect, if any, this can have on a divorce.

Who gets the engagement ring when the wedding is called off?

In Massachusetts, an engagement ring is usually considered a conditional gift: given on the condition that the couple gets married. The normal expectation is that if the engagement is broken and the wedding doesn't occur, then the ring will be returned. However, it doesn't always work out this way. In the event a dispute about an engagement ring makes its way to court, the court will look at the circumstances surrounding the giving of the ring and the circumstances surrounding the breakup of the couple.

Some people give the ring on an important day in the calendar. An engagement ring given on a birthday or on Christmas can be a combination of a unconditional gift and a conditional gift. If a court determines that the ring was a birthday gift, then it is not conditional and should not be returned. This concept should encourage giving the ring on a day that is only special because the engagement occurs on that day.

The way in which the couple breaks up can decide who gets the ring. If it is a mutual decision to not get married, then the ring should be returned as the wedding did not occur. However, if one of the parties misbehaves and this causes the break up, then it is a different result. The party who is at fault for the end of the relationship can't get the ring. If there is fault such as an affair, physical abuse, or other wrongful conduct, then the ring will go to the party without fault. If neither party is at fault, then the ring is returned to the donor.

The result is different after the marriage if a divorce occurs. Once the marriage occurs, the condition of the conditional gift has been met and the recipient of the ring gets to keep the ring. Unlike an engagement, fault in the termination of the marriage does not effect ownership of the engagement ring. Once the condition of the marriage is met, the gift is complete. This doesn't mean that the ring can never be returned. In a divorce in Massachusetts, a divorce judge has great discretion in property division. The judge's power extends to almost all property including the engagement ring. This means that a judge can change ownership of the ring to fairly and equitably divide all property owned by the couple. As a general rule, a judge won't look to change ownership of a ring unless the ring has significant value. In most divorces, the judge will let the recipient keep the ring.

If you are getting divorced an experienced divorce lawyer can advise you on property division including the manner to treat the engagement ring.

What is a QDRO?

QDRO stands for “Qualified Domestic Relations Order.” The term is created by federal law and applies to retirement plans created under ERISA, the Employee Retirement Income Security Act. ERISA is the federal law that allows private employers and individuals to have retirement accounts which have tax advantages to encourage the creation of private retirement accounts. ERISA also protects retirement accounts from most creditors. As a result, a person can't be sued and lose their retirement accounts. The exceptions to this protection against creditors are child support and alimony. If the creditor is a spouse or someone entitled to child support, they can reach retirement accounts. Retirement accounts can be a source of funds to pay alimony or child support. In addition, retirement accounts can be divided pursuant to a property division in a divorce.

Retirement accounts are not intended to be liquidated before retirement age. As a result, it could be a problem to divide the asset in a divorce. Congress solved this problem by creating the concept of a QDRO. A QDRO is an order from a court where, pursuant to a divorce, the court orders a portion of a retirement account transferred to a spouse. This allows the transfer of money from one retirement account to the retirement account of a spouse without incurring tax penalties. A QDRO describes with particularity how the account shall be divided and allows for future contributions to the account that may not be divided pursuant to the divorce. Since retirement accounts have many different characteristics, the QDRO should be tailor made to the employer's account. The QDRO is typically drafted by an attorney and then submitted to the employer for approval. After the employer has approved the QDRO, a judge must approve the document. The QDRO will then be filed with the employer. The transfer will then occur and penalties for early withdrawal can be avoided.

What does it take for a party to get 90% of the assets in a divorce?

Property division in a divorce is controlled by G.L. c. 208, §34 which lists the factors for a judge to consider when making a decision about property division. Usually, the judge makes a division somewhere between a 50-50 split and a 60-40 split. Sometimes, the judge may make a more lopsided division of 65-35 or even 70-30. It is almost unheard of for a judge to divide the assets by an 80-20 split. In the recent case of Wolcott v. Wolcott, 78 Mass.App.Ct. 539 (2011), the court did the unthinkable and awarded the husband 90% of the assets. This lopsided division was based on highly unusual circumstances.
In this case, the wife tried to hire someone to kill the husband and may even have tried to kill him herself. She was convicted of attempting to hire a hitman and served three months in jail. The appeals court found that "conviction of a spouse of the crime of soliciting the murder of the other spouse" was "exceptional" conduct that shocked the conscience of the court and would "have an impact on the ‘conduct’ factor under [§ 34] irrespective of ‘economic impact.’" However, the attempt to murder the spouse alone, would not have justified such a lopsided result. In addition to the wrongful conduct, the court looked at the economic effect from the wrongful conduct. The court found that the wife’s conduct forced the husband to "take on total responsibility for the children’s care"; "makes [the husband] totally responsible for maintaining the parties’ home"; and will "always" adversely affect the husband as it "diminishes his ability to be totally focused on life and work issues." The wrongful conduct and the economic consequences justified an award to the husband of 90% of the marital assets.
The lesson learned from this case is that it is cheaper to divorce a spouse than to try to kill the spouse. As always, compliance with the law is better than violation of the law.

Do-it-yourself divorce kits

There are advertisements for legal services such as do-it-yourself kits for divorce, wills, powers of attorney, bankruptcy, etc. These kits are usually sold by non-lawyers. People should not use these kits or services of this nature. Decisions in legal matters of this nature have long lasting consequences. Failure to include all issues or failing to address an issue properly is likely to have unfortunate and expensive results. A divorce agreement should be custom designed for each couple and tailored for the state of the divorce. Kits of this nature may be general kits that accommodate most states but not all and accommodate some couples but not all. People should avoid kits and advice from non-lawyers.  Before finalizing an agreement from a do-it-yourself kit, you should consult an experienced divorce attorney.