Who should have a premarital agreement?

The simple answer is anybody who comes to the marriage with something to protect when the marriage terminates should have a premarital agreement when they get married. The general categories of people who can benefit are people with children from a prior relationship, significant family assets, or people who own a business which comprises a major source of income.

If there are children from a prior relationship, they may not inherit when their parent dies without a premarital agreement. The laws of inheritance give preference to a surviving spouse. Even if a will exists, the law still gives preference to a spouse. The best way to make sure that children can inherit is to write a prenuptial agreement. When one spouse owns a business or a portion of the business in which they receive significant income, it may be desirable to make certain that the new spouse can't receive a portion of the business in a divorce. It can be devastating to the business to have a person own a business when they are not qualified to run the business. It can also be very difficult for one spouse to suddenly work for an ex-spouse.

Another group of people who should have a premarital agreement are people who are religious and whose religion offers a religious termination of a marriage.  Catholics, Muslims, and Jews can all obtain a religious decision that a marriage is terminated or never existed.  Some people will want both a secular divorce and a religious divorce or annulment.  Anyone in this group can benefit from a premarital agreement because an agreement can make a religious termination occur without a fight and at minimal cost.

Premarital agreements can successfully protect against these problems and others.  Consulting an experienced family law attorney before getting married can eliminate problems and fighting when the marriage terminates.

What is a pre-nuptial agreement?

A pre-nuptial agreement is an agreement between a couple who intend to get married which determines financial obligations upon termination of the marriage. All marriages terminate either by divorce or by death. A pre-nuptial agreement should determine rights and obligations for both methods of termination. A pre-nuptial agreement must be fair at the time of creation and fair at the time of enforcement. Fairness at the time of creation means that both parties must make a full and fair disclosure of their income, assets, expenses, and liabilities. Fairness at the time of enforcement requires a fair distribution of income and assets at the time of termination. This doesn't mean an equal distribution but one party can't be left destitute. As parties can't contract away children's rights, a pre-nuptial agreement can't determine child custody or support issues.

An experienced family law attorney can help avoid problems upon termination of the marriage.

Tenants' rights after foreclosure

In the recent case of Bank of New York v. Bailey, 460 Mass. 327, (SJC-10801, August 4, 2011) the court ruled that a tenant has the right to challenge the title of a owner who obtained their title to the property from a foreclosure.

While this is considered by some as a landmark ruling, it shouldn't be a surprise to lawyers who are familiar with landlord tenant law. In order to evict a tenant, the plaintiff must claim that they have a superior title to the tenant. In order to have a superior title, the plaintiff must have a valid ownership interest. In the Bailey case, the plaintiff claimed that a foreclosure deed, on its face, established their superior title and that the tenant couldn't contest this. If a deed by itself is sufficient to establish title, what stops a person from forging a deed and then trying to extort money from a tenant by starting an eviction case? I believe that it is unconstitutional to evict a person without allowing them the opportunity to challenge a forged deed. Yet the Bank of New York argued that their foreclosure deed was above challenge. The court decision does not go into great detail on BNY's arguments. However, it it possible that BNY argued that tenants generally can't contest the landlord's claim of title. This is correct but with different facts. If a person, claiming to own the property, gives a tenant keys and allows them to enter the property, the tenant can't claim that person is not the owner of the property. This doctrine of title by estoppel is based on the concept that a tenant who takes advantage of a claim of title by taking possession can't then challenge the very same claim of title. In the Bailey case, the tenant did not take possession of the property from BNY. They took title from someone else and BNY claimed that they took the title away by a foreclosure. There is no estoppel in this situation. The argument by BNY ignores another concept in eviction law. A summary process action (eviction) is an action to take away a property interest. This is called a forfeiture action. Forfeiture actions are abhorred by the law and require strict compliance with all formalities. This strict compliance with all formalities is also present in foreclosure actions for the same reason. The only way a court can discover if a foreclosure strictly complied with all formalities is by holding a trial. 

The decision of the Supreme Judicial Court complied with existing law.

Contempts and the right to counsel

In the case of Turner v. Rogers, U.S Sup.Ct. No 10-10 June 30, 2011, the Supreme Court addressed the question of is a court appointed attorney required in civil contempt proceedings for the collection of child support. The simple answer is sometimes yes and sometimes no. Probably, most of the time, court appointed counsel will not be required. It is my opinion that under present Massachusetts practice, court appointed counsel must be appointed. If Massachusetts makes some minor changes, counsel won't be required in the majority of cases.

The decision of the court makes it clear that incarceration as a result of a contempt finding is just as harmful as incarceration in a criminal case. Before jail can be imposed for non-payment of child support, the court must either appoint an attorney to represent the defendant or provide “substitute procedural safeguards.” Substitute procedural safeguards include (1) notice to the defendant that his “ability to pay” is a critical issue in the contempt proceeding; (2) the use of a form (or the equivalent) to elicit relevant financial information from him; (3) an opportunity at the hearing for him to respond to statements and questions about his financial status; and (4) an express finding by the court that the defendant has the ability to pay. Massachusetts practice includes the last three of these safeguards. What is lacking is the notice to the defendant that his ability to pay is a critical issue.

Notice of a complaint for contempt is provided by service of a summons and a complaint. The current form of a summons does not have any language that provides notice that ability to pay is a critical issue. As long as Massachusetts lacks this essential notice, it appears that Massachusetts will have to appoint attorneys to represent defendants in contempt cases. It should be a simple and inexpensive remedy for the state to revise the form of summons and include the language that is now constitutionally required. Until this is done, the language can be added to complaints or court appointed attorneys must be provided.

While the Supreme Court decision does not go further, I think that the decision requires more than notice and filling out a financial statement. It appears to require that the Defendant have the ability to understand the issue of ability to pay and to present testimony on this issue to the court. If the defendant lacks this ability, then the court needs to appoint counsel.

Assents in Probate

Recently, I was asked to explain an assent form for the administration of an estate of a deceased person.  In the probate process, there are a number of actions of the Executor that require approval by the Judge. Our probate system generally works on the assumption that the parties to the estate have the most knowledge. If the parties (heirs) want to object to the actions of the executor, then the court will look at the actions with more care. Otherwise, the court can assume that everything is proper. So when a judge's approval is requested, the heirs and other parties are given notice of the issue and given an opportunity to approve or object. If all parties approve, it can expedite the process and decrease the cost. If a person objects, it may create an issue for the court to investigate and hold hearings to resolve. The third choice is to do nothing and let the court decide what action to take without guidance from the parties.

If a party is requested to sign an assent, there are documents that will be submitted to the court which explain the proposed action. The first opportunity to assent is to approve the will and appoint the executor. The subsequent assents could be all sorts of things. Nobody should sign an assent unless they have copies of the documents relating to the issue and understand the contents. The assent will identify the document that is submitted to the judge. An assent says to the court that you approve the proposed action of the executor. It also says to the court that you don't need further notice of the proposed action.

The following is an example of how this works. When the probate is filed, the petitioner files a copy of the will with a petition to probate, a death certificate, and a bond. If you sign the assent, you probably won't get further notice of the petition to probate. If you don't sign the assent, you will be "served" (probably by mail but possibly by a sheriff) with a court document called an order of notice that tells you the petition and will were filed and that you are an interested party and have the right to object to the petition. It will also tell you the date by which you must file your objection. If you don't file the objection by that date, you will not have the right to contest the will or appointment.

Alimony Reform Act Part 2 - Types of Alimony

In Massachusetts, a judge can order alimony in a divorce or not. An award of alimony will last until there is a change of circumstances. The only way alimony can terminate based on a period of time is if the parties agree. Without such an agreement, alimony lasts until a party dies, the recipient remarries, or a change of circumstances exists.
The proposed Alimony Reform Act will allow different types of alimony. The bill will allow General Term Alimony, Rehabilitative Alimony, Reimbursement Alimony, and Transitional Alimony.
General Term Alimony is the equivalent of alimony under current law. However, under the new law, the court will limit alimony to a period of time unless the court makes findings that alimony should exceed the time limits. The time limits start at 50% of the length of the marriage for marriages under five years and can be indefinite for marriages over 20 years.
Rehabilitative Alimony provides support while a spouse acquires skills to become self-supporting. This will allow support while a spouse gets an education or job training.
Reimbursement Alimony is not based on need but provides compensation for support or other contribution to the family. It is not unusual for one spouse to sacrifice their education and work while the other spouse gets an education.
Transitional Alimony provides support while a spouse "transitions" to a new location or an adjusted lifestyle. Usually, this would be a one time payment. Under current law, a court can order payments of this nature but it would be part of a property division order and not alimony. Allowing payments of this nature as alimony will give Judges more flexibility in making judgments.
The proposed law, with different types of alimony, will provide more flexibility and more fairness in divorce decrees.

Alimony Reform Act of 2011 Part 1

In 2011 the Massachusetts legislature passed a law that changed  alimony  in  Massachusetts. The law is called the Alimony Reform Act of 2011.  I will discuss the proposed changes in this blog. I will post a number of articles as there are too many changes to discuss in one posting. The first topic will be the factors a court will consider when deciding an alimony issue.
Alimony is sometimes awarded when couples get divorced in Massachusetts.  It is controlled by G.L. c. 208, § 34.  The new bill, if passed, will be a complete overhaul of the law of alimony in the state.
I have created a chart which compares the alimony factors under present law and the proposed law which is included at the end of this article. The new law includes all of the factors that a judge must consider and may consider under current law and adds additional factors. However, the biggest change is a catch all concept that allows the judge to consider any additional factors as the court may deem relevant and material. There have been many decisions where judges have lamented the current limitations that restrict the factors to the those stated in G.L. c. 208, § 34. Under the new law, the Judges won’t have this limitation. This should result in fairer and more equitable results.
While the current factors are preserved, there is additional language that places an emphasis on certain behavior. Abuse that causes physical or mental harm that interferes with a party’s ability to earn income is specifically mentioned in the new law. It appears that health issues that effect one’s ability to earn money are emphasized in the new law as additional language is added to the health factor.
Under current law, alimony may be ordered by a Judge or not ordered. A Judge has no ability to limit an alimony award to a period of time. The proposed law will allow a Judge to impose time limitations. Thus a new factor will be considered: the appropriate period of time for alimony. This new concept in Massachusetts should create more just and fair alimony awards in divorces.

　

Current Law G.L. c. 208, § 34.	Proposed Law Alimony Reform Act of 2011
length of the marriage	length of the marriage
conduct of the parties during the marriage	conduct of the parties during the marriage including a party’s inability to provide for his or her own support by reason of physical or mental abuse by the payor
age	age
health	health including advanced age; chronic illness; or unusual health circumstances of either party
station	station and marital lifestyle
	ability of each party to maintain the marital lifestyle
occupation	occupation and if a party is unemployed or underemployed
amount and sources of income and employability	both parties’ income, employment and employability, including employability through reasonable diligence and additional training
vocational skills	vocational skills
estate	estate
liabilities	liabilities
needs of the each of the parties	needs of the each of the parties
opportunity of each for future acquisition of capital assets and income	opportunity of each for future acquisition of capital assets and income

	amount and duration of alimony
	ability to pay alimony
	economic or noneconomic contribution to the financial resources of the payor spouse and to the marriage
	Significant premarital cohabitation that included economic partnership and/or marital separation of significant duration
	lost economic opportunity as a result of the marriage and a party’s inability to provide for his or her own support by reason of a party’s deficiency’s of property, maintenance or employment opportunity
	such other factors as the court may deem relevant and material
	Tax considerations applicable to the parties
	Whether the payor spouse is providing health insurance and the cost of heath insurance for the recipient spouse
	Whether the payor spouse has been ordered to secure life insurance for the benefit of the recipient spouse and the cost of such insurance
	Sources and amounts of unearned income, including capital gains, interest and dividends, annuity and investment income from assets that were not allocated in the parties divorce

　
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Landlords must strictly comply with security deposit law

The Massachusetts security deposit law imposes severe obligations on landlords. Tenants have argued a strict interpretation of the law and landlords have argued for good faith compliance. In the case of Lopes v. Williams, 2010 Mass. App. Div. 227 (2010) the court sided with tenants in this argument. In this case, the landlord failed to place the security deposit in an escrow account. This failure required the landlord to return the security deposit to the tenant within thirty days of receiving the security deposit. An argument advanced in the past was that the tenant had to request the return of the security deposit. This case makes it clear. The landlord either holds the money properly in an escrow account or must return the security deposit to the tenant in thirty days even if the tenant does not request a return of the money. Failure to do so will cause the landlord to pay three months rent and attorney fees to the tenant. This case also dismissed the good faith argument. It is clear that landlord’s intentions or understanding of the law is not relevant to the landlord’s obligations and liabilities. The landlord must strictly follow the requirements of the security deposit law.

I think that this law is so difficult for landlords that unless they are professional landlords, they shouldn’t take a security deposit. They shouldn’t run the risk of paying three months rent and attorney fees.

Is the Ibanez decision a landmark case?

The Massachusetts Supreme Judicial Court recently issued a decision in the case of U.S. BANK NATIONAL ASSO. v. IBANEZ, (Mass. 172011) (Jan 7, 2011) in which the court held that two foreclosures in Massachusetts were void. Some commentators have treated this decision as a landmark decision in real estate that will shake up the mortgage industry. I think that this case is a reaffirmation of traditional concepts in real estate law. It may help some homeowners understand their rights, Some people who have lost their homes to foreclosure may even get their homes back. It should cause mortgage companies to be more careful in their attention to the paperwork and detail of mortgages and foreclosure.
Massachusetts law of mortgages and foreclosure was created in a day before computers when banks treated mortgages one at a time. Usually, banks loaned money and held the mortgage until it was paid off. Today, banks loan money for mortgages and sell them to other investors before the ink dries on the promissory note. Mortgages are bundled together and sold to investors in large groupings of mortgages. Paperwork has changed from selling a single transaction to selling thousands of loans at a time by transferring them to a trust or other entity. This process, called securitization, may have to change in light of the Ibanez decision.
In Ibanez, two properties were foreclosed upon and then the banks that bought the properties brought actions in land court to declare that they held good title to the properties. To the suprise of the banks, the court held that they did not have good title. The foreclosures were void.
Massachusetts has always held that any legal action that causes a forfeiture must strictly comply with the procedures required. Failure to comply with the formalities will result in failure to cause the forfeiture. This applies to foreclosures, evictions, or any other action that the law considers a forfeiture. The Ibanez decision was based on this concept that the mortgage companies failed to strictly comply with the formalities of foreclosures.
In Ibanez, the mortgages were sold many times before the foreclosure. The documentation of the transfers or assignments was not properly filled out until after the foreclosure process was started. Since a foreclosure can only be conducted by the party who holds the mortgage, the failure to properly assign the mortgage makes any subsequent foreclosure void. This doesn’t mean that assignments must be recorded at the registry to be valid. It does mean that the banking industry must take care to check the paperwork before foreclosing.
What does this case mean for future foreclosures? Actually, it makes very little difference. Banks and bank attorneys will have to do more work to prepare for foreclosures. If the paperwork isn’t correct, they need to correct it before a foreclosure is conducted. This may slow down the process a little. It should not be a significant difference. Homeowners may consult hire attorneys about stopping or reversing foreclosures. Since most people face foreclosure because they can’t make the payments, this won’t change the result. This case doesn’t put money in the pockets of homeowners. It merely forces banks to pay more attention to detail. A homeowner can hire a lawyer to fight a foreclosure but if the homeowner can’t find the money to bring the mortgage current, foreclosure will still occur. Eventually, the bank will own the property.
The Ibanez case is important but it is not earth shattering. Massachusetts law didn’t change. Instead, mortgage companies will change their practices a little.

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.

How does the father protect his parental rights when he is not married to the mother?

Men are suppose to have equal rights with women in Massachusetts. However, a recent case explains that when it comes to children from parents who are not married to each other, men don’t have equal rights unless they take certain steps to protect those rights. Ideally, men and women have equal rights under the law. However, science does not afford the same level of equality. When a child is born, there is no question of the identity of the mother of the child. Therefore, the law recognizes the mother and her parental rights immediately upon birth. Biology does not make identification of the father so easy. A man may be present at birth, have his name on his birth certificate, and support the child. However, these actions are not sufficient to instill the man with parental rights. An alleged father of a nonmarital child may become a legal parent in one of two ways only: through an adjudication by a judge, or by filing a voluntary acknowledgment of paternity executed by both parents. The man’s name on the birth certificate is not sufficient.
The recent case of SMITH v. McDONALD, SJC-10670 (Mass. 12-14-2010) explained that prior to a legal determination of paternity, the child's mother is vested with sole physical and legal custody, and that custody arrangement continues even after paternity is established until modified by a court. So if no court action has been filed, the mother has sole custody of the child even if the parties have executed a voluntary acknowledgement of paternity.
A man who wants to protect his parental rights must have a judge determine that he is the father and grant him joint legal or joint legal and physical custody. Even if the parties are living together, when a child is born of a non marital relationship, the parties should execute a voluntary acknowledgment of paternity and go to Probate Court and have the court grant joint custody to the father and mother. This will protect the child’s rights as well as the father’s rights.

Massachusetts has a new homestead law.

Massachusetts has changed the homestead law effective in March 2011. These changes will benefit every person in Massachusetts that owns a home. A homestead is a statutory exemption protecting a principal residence against the rights of creditors. This means that a homeowner who owes money for a debt has some protection against losing his home to the creditor. The new homestead law provides an automatic homestead in the amount of $125,000.00 and three other types of optional homesteads that provide protection of $500,000.00. I recommend that every homeowner should take advantage of the homestead law and file a declaration of homestead to take advantage of the full $500,000.00 protection.
A homestead does not prevent a creditor from attaching a home. As an example of the way this law works, take the example of Homeowner A who causes an auto accident and gets sued for $1,000.000.00. The damages sought exceed the amount of A’s auto insurance so the victim of the accident obtains an attachment of A’s home. If there was no homestead, the victim could force a sale of A’s home to get the equity in the house. However, with the homestead, the victim could still force a sale of the house but the first $500,000.00 in equity ($125,000.00 if it’s the automatic homestead only) goes to A and not the victim. This means that the victim won’t force a sale of the house unless A has more than $500,000.00 in equity.
There are many improvements in the new law that will benefit homeowners. The new law extends the homestead protection to spouses and other family members. The law also protects against prior debts that are not yet secured by the house. Of course, it doesn’t protect against voluntary liens on the real estate such as mortgages.
I recommend that every person in Massachusetts who lives in a house that they own declare a homestead.

Bullying in a divorce

There has been much discussion in Massachusetts lately about bullying in schools. However, bullying is not limited to that arena. Bullying occurs everywhere in society including marriages and divorce. However, in a divorce, bullying can be particularly harmful. Bullying can effect the outcome of a divorce and this can have ramifications for the rest of a person's life. In fact, frequently, bullying is conducted for the sole purpose of effecting the outcome of the divorce.

It is not unusual for one party in a marriage to be overbearing to their spouse. When the parties get divorced, it is typical for the overbearing conduct to get worse. This conduct can vary from merely being rude to being highly destructive to spouse and children. Bullying should be recognized as a form of abuse. It is a course of conduct that is designed to control the spouse and should never be tolerated in a divorce.

Unless this conduct is addressed, you can expect that it will continue and get worse. If there are children, it is possible that this conduct will last for the joint lives of the parties. While they may be getting divorced, they will still have to deal with each other because of the children.

How do you deal with bullying? The first step is to recognize conduct as bullying. Then take the person to an authority that can punish the conduct.

Bullying involves repeated acts attempting to create or enforce a person's power over another and creating an imbalance of power. Bullying consists of three basic types of abuse – emotional, verbal and physical. Wikipedia. Massachusetts defines bullying in schools as: "the repeated use by one or more students of a written, verbal or electronic expression or a physical act or gesture or any combination thereof, directed at a victim that: (i) causes physical or emotional harm to the victim or damage to the victim's property; (ii) places the victim in reasonable fear of harm to himself or of damage to his property; (iii) creates a hostile environment at school for the victim; (iv) infringes on the rights of the victim at school; or (v) materially and substantially disrupts the education process or the orderly operation of a school. For the purposes of this section, bullying shall include cyber-bullying." G.L.c. 71, § 37O. These definitions apply to divorces as well.

Bullying needs to be brought to the attention of the court. Only the court can punish this conduct. If the behavior involves physical conduct or a threat of physical abuse, then a domestic abuse restraining order can be obtained under G.L. c. 209A. Other conduct can be addressed by the court’s powers in a divorce or paternity action. It is not unusual for orders of the court to address this behavior without knowing that bullying is occurring. Usual orders include language that no conduct can occur that denigrates a party and that the parties have to treat each other with respect.

If bullying occurs, get an order to prevent the specific conduct and then bring a contempt to address the wrongful behavior if it continues.  Abuse should never be tolerated.

Perhaps the best way to deal with bullying in a divorce is to hire an experienced family law attorney.   This attorney should act as a barrier between the bully and the victim.  I find a very effective course of conduct is to direct the anger of the abuser to the attorney instead of the spouse.   When the bully blames the lawyer, they usually back off from abusing the spouse.