LGBTQ Rights Going Forward – Possible Impact of a Trump Presidency

During this campaign cycle, we saw the backlash to broad spectrum of efforts to obtain full equality. While Obama was not perfect, under his administration, movements of the people flourished. Immigrant communities organized, raised awareness, and applied pressure achieving at least a few minor gains, like the DREAM Act. Black Lives Matter flourished. While the president was not as forceful as I would have liked, he did defend the movement and under his leadership investigations occurred into police accountability/abuse and reports were issued that have the power to create some systemic change. He raised awareness of about the abuse of our system of incarceration and took steps available on the federal level.

The LGBTQ movement was also able to thrive under Obama. He appointed several members of our LGBTQ community into key leadership positions. Questions about fair housing, included questions about whether LGBTQ people were discriminated against. He also took a position that the ban on marriage discrimination was wrong. When the Supreme Court finally remedied the long standing practice of denying marriage to same-sex couples, the Obama administration went to work on finding all of the places where the federal government was involved and removing any barriers to equality.

It is hard to believe sometimes that Lawrence v. Texas was decided in 2003. How on earth was it only about 13 years ago that some states still outlawed homosexual conduct (i.e., sodomy)?  When the barriers finally began to fall, full equality felt like it came at a rapid pace. This is why, despite all the growth we have had, in many ways the changing administration doesn’t change the longstanding advice for the LGBTQ community.

The people dedicated to these issues have issued FAQs and information. Lambda Legal has Post-Election Facts – Covering marriage (unlikely to see much change), trans youth, conversion therapy, hospital visitation, HIV and concerns about the repeal of Obamacare and hate crimes. NCLR has several blogs, Shannon Minter, their super smart legal director has this to say about the unlikely outcome of repealing marriage. The NCLR is also one of the best resources out there to understand state-by-state differences. The Transgender Law Center issued this Statement on the election.

In addition to these thoughts, I will add, no president, congress, or court has ever simply given the LGBTQ people rights. It has been a hard fought battle, that was based in some incredible activism changing hearts and minds.

It also doesn’t hurt our cause that LGBTQ people are everywhere. Race, religion, ethnicity, and many other identities find people still segregated, largely due to historic discrimination issues, but also because sometimes it is easier to live in communities where you see yourself, you know you are less likely to be targeted for harassment and violence, you know when you go to the store they will have beauty products for your hair, or a grocery store that will meet your kosher needs. This segregation doesn’t occur in the same way for the LGBTQ people, while as grown-ups we may seek out gayborhoods, we are raised Muslim, Evangelical, atheist, Jewish and every other religion. We are Black, Asian, Latinx, Native American/First Nations/Indigenous, White and every other race and combination of race and/or ethnicity. We come from conservative families to progressive to anarchistic families. It is simply impossible to shield yourself from loving someone, a son, daughter, auntie, uncle, parent, who may come out as LGBTQ and the more accepting world expanded the safety area for people to come out. It is impossible to exist in any identity without also having LGBTQ people as a part of that identity.

However, this change is recent. We have not lived in a post-Obergefell (Supreme Court case affirming the dignity of same-sex marriages and holding discriminating against same-sex people in marriage liscenses violated our constitution) world long enough to have let our guard down. Attorneys advising same-sex clients were still saying, get your documents and don’t delay.

What kind of documents should you get?

Transgender people should make sure their identity documents match their gender identity (to the extent possible as they predominately exist in the male/female binary). One place to turn for information on this available at the Transgender Law Center Identity Document Resources– it’s California focused, but it does have information about federal changes. Looking at the California info may also help you figure out how to look for the same in your own state.

Protect your relationship to your children. If you have read any other blogs I have written or seem me present, you have heard me say marriage equality does not equal parentage equalityGet a court order affirming parents are parents. This can be done a couple of ways. Many people are most comfortable with adoptions. There is case law to support that court orders adjudicating parentage will be given full faith and credit, this is essentially an order of parentage, similar to what has been historically called paternity. In Washington State, our law regarding determining parentage is gender neutral (Uniform Parentage Act / UPA, which despite its name is not uniform and many states haven’t adopted it, or they tweak it. Washington tweaked our UPA to be clear it included same-sex couples).

If you haven’t done this, and your family is splitting up, you can make sure that your parenting plan has a finding that you are the legal parents. Parenting plans have extra security under a law called the Uniform Child Custody Jurisdiction and Enforcement Act (UCCJEA – and unlike the UPA it actually is uniform). There is also something called the Hague convention and signatory countries (countries who have agreed to follow the Hague rules) will also help with the enforcement of parenting plans). There are some concerns with something like this and possible rights and benefits that could flow to your child upon your death, so you should definitely explore other possibilities.

All LGBTQ couples should have estate planning documents – which a way of making you sound wealthy, but really means that you should have a power of attorney, medical directives, a will. These kind of documents are fairly easy to obtain. The reason for having them is mainly to have an additional weapon against discriminatory individuals at important times. These are also the kinds of documents people absolutely needed when there was no marriage. It was the only way that same-sex couples could link themselves in the eyes of the state.

Pay Attention – More Advice Will Come Out Once Trump is in Office with a Republican Congress

There is so much more we will learn in the coming months and years. The hateful rhetoric connected to this election has all of us justifiably nervous. The thing that helps keep me from panicking is remember that our government was set up to thwart major sweeping changes. It took a long time to get where we are and it will not be unwound easily.

Perhaps it means as states that are happy with having the marriage issue decided can try to clean up their statutes that banned marriage and explicitly say that same-sex marriage is allowed in their state (this would mean absent an amendment to our constitution marriages would still have state protection). While states are at it, they should make their laws regarding parentage and have two things clear (1) that families can affirm their parentage if they meet the terms of the UPA (which is basically that you consented to assisted reproduction while married or that you have lived with the child since birth for several years and held the child out as your own) and that the provision apply on a gender neutral basis, i.e., biology is not the only factor in determining parentage.

Also, be sure to reach out when you experience discrimination. The national organizations like Lambda Legal, NCLR, Transgender Law Center, and the Southern Poverty Law Center, need to know what’s happening in people’s lives to respond to it. Also, let your state organizations know. In Washington, groups like Legal Voice and the ACLU have been spearheading many efforts. Our Attorney General created a Civil Rights Division. The QLaw Foundation has a legal clinic that provides free legal advice on civil question (i.e., non-criminal).  Gender Justice League has resources on health insurance issues (among many other things). Ingersoll Gender Center has support groups, resources, and information about providers. There are also many other groups that focus on intersectionality: Entre Hermanos, Trikone NW, NQAPIA, and many more.

I’ll keep trying to update about what’s happening in Washington as several interesting cases concerning LGBTQ people are before our state Supreme Court this week.

Parting thought: Please take care of yourself, legally, socially, and emotionally.

Family Law Unpublished Decisions from Division 1 -June 15, 2015

There have not been many published family law cases of late. I thought since there were a couple of unpublished decisions, I would mention them, even though they do not seem to offer much in terms of legal interpretations, but sometimes it’s interesting to see what’s happening in other family law cases.

In Re Marriage Of: Halligan,, App., Docket No. 71391-4; Opinion Author: Linda Lau; Concurring; Dwyer and Shindler; Counsel for Appellant John Halligan (Pro Se); Counsel for Respondent Micheal Schein

Brief Facts: Couple married 9/1995 and separated 6/2012. One child born in 2011. Husband gross income ~$13,000; W gross income ~$3,200. Total assets about $564k distributed 60% to Wife and 40% to Husband. For a seventeen year marriage, wife was awarded five years of maintenance at $3,500. There was also a child support award amount, but the amount was unclear (at one point it looked as if the $3,500 may have been maintenance and child support, but I think it was on top of the $3,500 in maintenance).

Issue 1: Retirement Benefits: The parties used Steven Kessler, whom the court described as “an experienced certified public accountant” to calculate the value of their retirement plans. Husband did not challenge the valuation of one of the retirement pensions during the expert’s testimony, but did on his direct testimony. The admission of the report without objection and the lack of questioning the expert on this point were significant factors and the court felt his opinion was largely unchallenged factored heavily into the court’s decisions as there was nothing in the record to indicate that the trial court’s decision to rely on Kessler’s opinion was unreasonable or an abuse of discretion.

Issue 2: Attorney’s Fees: Husband also challenge the award of attorney’s fees to Wife at the trial level. When a party seeks to challenge the attorney’s fees, they must establish that “the court used its discretion in an untenable or manifestly unreasonable manner.” Wife had incurred attorneys fees of $60,621 and the court awarded $18,000 in attorney’s fees. Division 1 declined to overturn the court’s award of attorney’s fees.

Issue 3: Exclusion of Expert Witness: Husband attempted to provide the testimony and report of Neil Bennett, a vocation counselor. He did not disclose it in a timely manner and the court sanctioned Husband by excluding the witness. Here Division I notes that in Husband’s appeal he made factual assertions not supported by the record in violation of RAP 10.3(a)(6). Division I noted that when a trial court imposes a severe sanction, such as witness exclusion, the record must clearly demonstrate that the court considered (1) whether the violation was willful or deliberate; (2) whether the violation substantially prejudiced the opponent’s ability to prepare for trial; and (3) whether a lesser sanction would probably suffice. Division I noted that the trial court considered all three factors on the record and there is no evidence of abuse of discretion in the exclusion of the testimony.

An notes is that the trial court rejected the claim that a continuance automatically extended all discovery deadlines without entry of a new case scheduling order or the court’s approval.

Issue 4: Post-Separation Payments to Fidelity 401(k): The post-separation payments to the 401(k) were connected to a loan from the 401(k) to buy the property. The trial court noted this and found no need to provide credit for payment to a debt assigned under temporary orders. Division I found no abuse of discretion and also noted that mischaracterization of property is not grounds for setting aside the trial court’s property distribution if the division of the property is fair and equitable and that this post-separation payment was not crucial to the court’s decision.

Issue 5: Federal Tax Exemption: Husband made an argument that there was a scrivener’s error in allocating the tax exemption to the Wife instead of alternating, but the record indicates that the tax exemptions were awarded in connection with the amount of child support payments.

issue 6: Verification of Work-Related Daycare Expenses: Husband wanted some sort of proof for work-related daycare expenses, but he failed to provide any meaningful legal argument or citation to relevant authority and the court declined to consider his argument.

Attorney’s Fees on Appeal: Despite an overall tone of the opinion that sounded like there were at least some points the court thought were without merit, the court did not award attorney’s fees on appeal.

 

In Re The Marriage Of: Robin Maelee Hitz, Res. And Eric James Hitz, App.; Docket No. 71413-9; Opinion Author: Spearman, Concurring: Applewick & Dwyer; Counsel for Appellant: T Reinhard G ‘ron’ Wolff;  Counsel for Respondent: Robin Maelee Hitz   (Appearing Pro Se). 

Husband appeals, claiming that the trial court “lost jurisdiction” (Division I’s quote) ove the case. Division I notes Husband misrepresents relevant facts and that no authority supports is claim that the dissolution became a new proceeding for purposes of the statutory entitlement to a change of a judge when the bankruptcy court lifted a stay and allowed the dissolution to proceed.

Brief Facts: Husband and Wife owned a business together. The judge disclosed a relationship owned by his family and the bank and the parties waived any potential conflict. There was a nine-day trial. The decree assigned Wife the responsibility of liquidating the community assets as paying debts owed. Husband didn’t cooperate and his parents filed a lawsuit against the parties in 2012 claiming an unsecured promissory note (the judge disqualified itself from this case, but noted he thought it had been unnecessary). In April 2012, funds were ordered to be divided between the bank, the parents pursuant to their lawsuit and the parties. Husband filed motions for recusal without noting his motions for hearing. At some point Husband also filed for bankruptcy. After a stay lifted pursuant to the bankruptcy filing, the court denied the motion for recusal, awarded Wife $18,000 in attorney fees and entered a restraining order against Husband. The court also denied Husband’s motion for reconsideration an imposed sanctions against Husband of $5,000 under CR 11.

Division I Discussion: Division I notes that appellant’s brief must contain an argument with legal authority and references to the relevant part of the orders and that Husband’s legal arguments are based on assertions of fact largely unsupported by any reference to the records and that some citations are inaccurate or contradicted by the record.

Recusal – Division I notes that Husband’s argument is factually incorrect as the judge recused himself in a different case and expressly declined to recuse himself in this case. The affidavit of prejudice was also untimely and Husband’s argument that the bankruptcy court granting relief from the automatic stay did not somehow create a new action. It was not a modification, but a continuation of the original issue.

Attorney’s Fees – Husband’s request for attorney’s fees was denied. The court did find that appeal was frivolous, but did not impose additional sanctions. The court did award attorney’s fees for wife.

 

Nathan Brown, Iii, Appellant V. Mi K. Brown, Respondent, Docket No. 71398-1, Opinion Author: Dwyer; Concurring: Spearmand and Appelwick; Attorney for Appellant: Nathan Brown III   (Appearing Pro Se); Attorney for Respondent: Joseph Orry-leroy Baker  

Father’s petition for a parenting plan modification was dismissed and sanctions were imposed for his failure to comply with the court’s scheduling order. Court affirmed and found his appeal frivolous and awarded fees to Mother.

Basic Facts: Original parenting plan provided three sons reside a majority of time with Mother. Father sought to modify. A superior court commissioner entered orders finding adequate cause for a trial and appointed a GAL. After the GAL filed her report Father filed a motion for a temporary order adopting his proposed parenting plan and “several provisions of the GAL report” and terminating child support based on the age of the oldest child and requesting a change of residence for the other two children. The commissioner denied the request for change in the residential schedule pending trial and stated that no child support adjustment was properly before the court. Over the next couple of months Father did not file pleadings required by the case schedule or the pretrial conference order, including no witness or exhibit list, no financial declaration, and no trial brief. Mother filed a motion to dismiss the petition with prejudice and terms based on Father’s file to comply with the case schedule. The court found there was “absolute noncompliance” with court orders and nothing would suggest mitigating circumstances and awarded terms in the amount of 75% of Mother’s attorney fees.

Division I Discussion: While dismissal is disfavored it is justified when a party willfully and deliberately disregards reasonable court orders, resulting in prejudice to the other party, and impairing the efficient administration of justice under CR 41(b). Disregard of a court order without reasonable excuse or justification is deemed willful.

Division I rejects the following claims by Father:

1 – Commissioner’s temporary order resolved issues making trial unnecessary (new issue on appeal). The temporary order was only temporary pending trial – argument rejected.

2 – The “or” was disjunctive and therefore terms and sanctions should not have been awarded. Plain language is clear that this is not what the statute intends- argument rejected.

3- The trial court erred in placing the sanctions on Father instead of Father’s attorney. Statute is clear sanctions can be on individual or attorney – argument rejected.

4- Mother was not prejudiced and that Mother failed to sufficiently mitigate her prejudice. Mother’s attorney had to prepare and also attempted to follow-up with Father’s attorney to make sure deadlines were met – argument rejected.

5- Father was not sufficiently warned about sanctions (new issues on appeal). Terms are clear under KCLCR 4(g)(4), plus Mother’s attorney had numerous calls, e-mails and letters to Father’s counsel regarding failure to comply with case schedule – argument rejected.

Division I granted Mother’s request for fees on appeal. The court stated that Father’s appeal presented no debatable issues and mother entitled to an award of fees and costs on appeal.

Lundy v. Lundy – ERISA and Divorce

 

When couples divorce, sometimes it can be challenging to figure out how to divide up assets, especially when valuing the assets is complicated or there are a variety of state or federal laws impacting the ability to divide the assets.

Assets can include stocks, real property (houses), bank accounts, and retirement. Some of these items are easier than others to divide up, like a bank account. In a bank account, money is money and there are no rules about accessing money.

Retirement and pensions are a different matter. For some couples, retirement or pension may be one of their only assets. There are often rules about how and when retirement funds can be transferred. It is not unusual for couples who have enough assets to try to divide their other property in a manner that allows the spouse with the retirement to keep the retirement account.

A recent Division 1 case discussed a case where the parties may have attempted to waive the Wife’s retirement interest in Husband’s account: Craig S. Lundy, Resp. vs. Kelly Lundy, App., Docket No. 71900-9 -I, File Date: June 1, 2015; Opinion Appelwick, Counsel for Appellant: J. Bruce Smith and Phillip James Buri; Counsel for Respondent: Perry William McConnell 

This case involved a couple that was married in 1984 and divorced in 2009. They both worked and had retirement accounts. Their divorce decree awarded “all retirement funds and 401Ks in [his/her] name.” The couple did not have children.

About four years later Husband died without a will and without any children. At the time of Husband’s death, his retirement account was valued at about half a million dollars. Husband worked at Boeing and his retirement account controlled by ERISA, a federal scheme for regulating employee benefit plans. Wife was listed as the beneficiary of the account.

Husband’s estate (managed by a sibling) petitioned to get the retirement funds from Wife, relying on RCW 11.07.010(2)(a), which provides that the designation of a spouse as beneficiary of a nonprobate asset is automatically revoked upon dissolution of marriage. Wife argued that the statute was preempted by ERISA, meaning the law didn’t not apply to his retirement because federal law supersedes state law.

The question here is whether Wife was able to retain funds, not whether the plan properly provided the funds to Wife.

Division 1 cited a 2001 U.S. Supreme Court case, Egelhoff v. Egelhoff, 532 U.S. 141, (2001) that the statute is preempted “to the extent it applies to ERISA plans.” The Court said that after Egelhoff, there is no doubt that RCW 11.07.010 is inapplicable to ERISA benefits. Division 1 also discussed a recent Supreme Court case which discussed ownership of similar benefits after distribution, Hillman v. Maretta, U.S. , 133 S. Ct. 1943, 1952, 186 L. Ed. 2d 43 (2013), noting that this case is not on point, but it suggests the same outcome would be appropriate in this situation.

Division 1 discussed other U.S. Supreme Court ERISA cases: Boggs v. Boggs, 520 U.S. 833, 835-36, 841, 117 S. Ct. 1754, 138 L. Ed. 2d 45 (1997) and Kennedy v. Plan Administrator for Dupont Savings and Investment, 555 U.S. 285, 129 S. Ct. 865, 172 L. Ed. 2d 662 (2009), both basically holding that what the ERISA type plan says regarding distribution applies to the plan administrator and post-distribution to whomever received the benefits.

Division 1 also discussed Ninth Circuit Cases, Carmona v. Carmona. 603 F.3d 1041,1062 (2008) and a pre-Egelhoff case, Emard v. Hughes Aircraft. Inc.. 153 F.3d 949 (9th Cir. 1998). abrogated by Egelhoff. 532 U.S. 141. See 603 F.3d at 1061- 62.  The Carmona court observed, Emard was abrogated by Egelhoff. 

In the Carmona, when Husband had already retired and the plan refused to change the beneficiary, noting that beneficiary was irrevocable upon his retirement. In the couple’s divorce a Nevada court attempted to award Husband both pension plans as his separate property. Husband tried to get new wife placed as his survivor beneficiary. The Nevada court said former-wife waived her right to the plan benefits and she would be unjustly enriched if she remained the beneficiary. The court ordered the plan administrators to change the survivor beneficiary to New Wife or for Former Wife to place funds in a constructive trust with the New Wife as the beneficiary. The Ninth Circuit overturned the court’s orders, finding constructive trusts are impermissible as it was clearly an attempt to avoid ERISA and it is preempted.

The state cannot revive a preempted statute simply by applying it in a post-distribution argument. The court also says that waiver is not apparent on the face of the dissolution decree. Wife did not expressly disavow any interest in the proceeds of the account as beneficiary. “Disclaiming an ownership interest is not the same as disclaiming future rights as a beneficiary.”  

In order to waive a future interest, the ex-spouse must explicitly waive the right to receive ERISA proceeds. The court provides the following examples: See, e.g.. Kennedy. 555 U.S. at 289 (exspouse divested of “‘all right, title, interest, and claim in'” ERISA accounts); Andochick v. Bvrd. 709 F.3d 296, 297 (2013) (ex-spouse waived “any interest, including but not limited to any survivor benefits” and “‘released and relinquished any future rights as a beneficiary under”‘ ERISA plans), cert, denied. 134 S. Ct. 235, 187 L. Ed. 2d 145 (2013); Estate of Kensinger v. URL Pharma. Inc.. 674 F.3d 131, 132-33 (2012) (ex-spouse agreed to “waive, release, and relinquish any and all right, title and interest” in ERISA accounts).

In the absence of an express agreement, waiver requires “unequivocal acts or conduct evincing an intent to waive.” Wagner v. Wagner. 95 Wn.2d 94, 102, 621 P.2d 1279 (1980).

Bottom Line for Divorcing Parties: (1) Determine whether your plan is governed under ERISA, if it is, make sure to include explicit language regarding any waiver of ERISA proceeds (see language court referenced above). (2) Whenever you divorce, update your beneficiary designations, make sure that prior to divorce you investigate what it would take to update your beneficiary designations from your plan administrator and consider including a provision in the divorce decree that the other party comply with all requirements.

Side note for attorneys regarding Motions to Strike and Impose Sanctions: Motions to Strike sentences or sections out of briefs waste everyone’s time and it is a practice the court discourages.  See Footnote 6: We also deny the parties’ various motions to strike and impose sanctions. Both parties engaged in practices that we discourage. Motions to strike sentences or sections out of briefs waste everyone’s time. O’Neill v. City of Shoreline, 183 Wn. App. 15, 24, 332 P.3d 1099 (2014). The citations to unpublished cases in the briefing was in violation of our rules. GR 14.1(a): Johnson v. Allstate Ins. Co.. 126 Wn. App. 510, 519, 108 P.3d 1273 (2005). However, we do not welcome motions from the parties seeking sanctions for doing so. This court is aware of its authority to award sanctions and can determine on its own when to do so. See RAP 18.9(a) (“The appellate court on its own initiative . . . may order a party or counsel [who] fails to comply with these rules to pay terms or compensatory damages to any other party who has been harmed by the delay or the failure to comply or to pay sanctions to the court.”

 

Characterizing Family Operated Businesses in a Dissolution

Family operated business can make the dissolution of a marriage more complicated. A recent published Division III case discusses characterizing the farm ground and equipment of a family farm where Husband worked the farm that the Father-in-Law tried to create as separate property for wife. Division III of Court of Appeals determined that the trial court erred in failing to recognize the community interest in the farming operations and assets and sent the case back to the trial court for a determination of whether the distribution would have been the same if the property was properly characterized.

The court’s ruling affirms a piece of advice from a KCBA Family Law Meeting presentation by Shelby Lemmel on April 3, 2015. Whenever possible, have a trial court clarify if it would have distributed property in the same manner regardless of the character of the property. It’s also good advice for judges who don’t want any part of their decisions remanded. If the court would have distributed the property in the same manner whether it was characterized as separate or community, and the court order stated this, the parties would not have to go back to trial.

In re the Marriage of: Jeannie Kile & Gordon B. Kendall, Docket No. 31523-1-III, File Date: 04/09/2015; Opinion: Siddoway; Counsel for Appellant Craig Mason; Counsel for Respondent Martin Louis Salina

The oversimplified facts of this case are Husband and Wife were together for approximate 28 years and had two adult children together. Wife’s father had a messy divorce and he was trying to keep the farm as his daughter’s separate property.  Husband learned farming business from Wife’s father and eventually quit his day job to farm the land full-time. He was paid for his work, the testimony was that he was paid fairly, but there was no evidence in of market wages or benefits in the record. Interestingly, Husband was in charge of determining how much he was paid.

It seems that from the appellate court’s perspective, one of the places where Father may have gone wrong to actualize this intent was charging fair market value for the lease, especially since Wife did not have separate property assets to pay the lease. Instead, the community and Husband bore “burdens and risks in performing the lease obligations.” Another interesting point was that the couple hadn’t entered into any kind of agreement regarding farm lease to clarify that there intent was that it would be separate property. There was another parcel of land where Husband issued a quit claim deed and the court found that (among other things) kept it as separate property (possibly with a right of community reimbursement for payments).

After Wife filed for divorce in 2011, her father sent a notice terminating the farm lease based on dissatisfaction with Husband’s performance asking that Wife turn the farming operations over to her son. Wife’s father died in January 2012, leaving the farm ground in trust in which Wife and Son have beneficial interests.

Husband was awarded about 80% of the parties’ separate property.

Regarding the Farm Lease as a gift “gift,” the court’s analysis focused on the concept of a gift as a voluntary transfer or property without consideration and that here, since there was an exchange of consideration because there was a lease/contract. Offering a contract on market terms is not a gift.

Turning next to the question of whether it qualified for separate property under RCW 26.16.010, rents, issues, and profits of separate property, the court noted that, where a spouse has separate property, the statute recognizes his or her authority to manage it “as fully, and to the same extent or in the same manner as though he or she were unmarried.” Here the court noted that it was not separate property in existence prior to marriage, Husband used part of his retirement to help fund the operations (even if they were restored at a later time) and Wife trusted Husband to pay himself a wage based on what was good for the farm. The court found that this was a spousal enterprise and did not qualify as separate property of a spouse, instead it fell squarely in the “fundamental premise of the community property system that both spouses contribute to property acquisitions in a joint effort to promote the welfare of the relationship.”

Wife failed to overcome the presumption of the community character of the farm lease. Wife admitted that the parties never executed any joint property agreement that would change the legal character of the farm lease and its profits from community to separate property.

In the case of the equipment lease, the father had forgiven a debt of approximately $50,000 and this evidence was determined to be sufficient to rebut any presumption of a gift to the community.

There was another property that was purchased during the marriage. Not only did the undisputed evidence support the trial court’s findings that the conveyancing deeds reflected Wife’s purchase in her name as separate property, but Husband also executed a quit claim dead. The court noted that since the farm made payments and the farm was determined to be community property there may be a right of community reimbursement but it does not result in a change (“transmutation”) of the property from separate to community.

The appellate court noted that remand was required where, “it appears the trial court’s division of property was dictated by a mischaracterization of the separate or community nature of the property.” The court said it is unclear whether the court would have divided the property the same way had the assets been properly characterized, which required remand to enable the trial court to make a just and equitable division of the property considering its correct characterization.

On the issue of spousal maintenance, the trial court found that Husband’s request was vague and there was no information regarding his willingness or ability to work. The spousal support statute is permissive (a court “may” grant). RCW 26.09.090. Trial court awarded Husband $650,000, including 80 percent of the parties’ community property and the court found that Husband failed to establish any abuse of discretion for failing to award maintenance on top of this. Though the court did note that with the re-characterization of property, the trial court has the authority to revisit its decision on maintenance on remand.

Family Law Unpublished Decisions – L&I settlements & converting separate and community property

The vast majority of legal cases settle, this is true in family law as well. Possibly even more important in family law cases with children, because trial is so adversarial and damaging to family relationship. But there are times in which the issues are too important for one party to settle. There are sometimes emotional factors that prevent settlement too. Of the cases that actually make it trial, far fewer are appealed. Of those that are appealed only some of them are published, meaning that they are allowed to be cited to support a theory of a case. Nevertheless, unpublished opinions provide a glimpse into issue that people struggle with and arguments that are made and either accepted or rejected by the appellate courts. These can be a useful tool for attorneys in advising their clients on the possible outcomes of a case. A quick summary of the nonpublished family law type cases in the last 14 days is below.

In re Marriage of Bierline, 71344-2-I  – Opinion- Author: Judge Spearman, concurring Judges: Trickey and Lau. Attorney for Appellant – Jason Woehler; Attorney for Respondent James Gallagher. 

Wife was granted a share of Husband’s pending L&I settlement in the dissolution decree in 2003. Husband failed to inform Wife or trial court that he reached a settlement in March 2003, about three months before the dissolution was finalized. A couple months after the dissolution was finalized, Wife noted a motion for an order enforcing the decree, clarifying and compelling payments, and entry of judgment. Right before the hearing Husband filed for bankruptcy, so Wife’s motion was stayed. Bankruptcy Court found Husband had engaged in bad faith and other deceptive practices and dismissed the bankruptcy in February 2004.

Wife  re-noted her hearing and in March 2004, the trial court ordered a specific sum. No further action was taken for more than nine years, when in October 2013, Wife made a claim, which the trial court granted. Husband filed a motion to quash the order of examination and halt further enforcement proceedings as time barred under RCW 4.16.02 and 6.17.020. Wife did not respond or appear at this hearing. Court granted the motion that it was time-barred.

When Wife appealed. The appellate court noted that Wife’s claim that the settlement date was not the date that the started the time clock could not be heard on appeal because she failed to raise it below. Nor did she seek reconsideration of the order granting the motion under CR 59 or move to vacate the order under CR 60. The court rejected her claim that she could raise the issues under RAP 2.5(a).

There were also errors in the perfecting the record on appeal (making sure the appellate court had all the files from the trial court necessary to review claims in the appeal).

The appellate court rejected the claim that CR 11 motions for sanctions should be granted. The court did grant attorney’s fees because appellant did not preserve issues for appellate review and did not merit discretion review and so they found that the appeal was frivolous and awarded reasonable attorneys fees and costs on appeals in compliance with RAP 18.1(d).

In re Marriage of Bolton and Schneider71212-8-1  –Opinion Author: Judge Cox; Concurring Judges: Schindler and Verellen. Attorney for Appellant – Kenneth Karlberg, Attorney for Respondent Michael Finesilver. 

Separate property was converted to community property and even if it weren’t husband failed to argue that the characterization impacted the overall distribution of property.

This is a case about converting separate property into community property. The court cited the standard that, in order to convert separate property to community property, the presumption of its separate character must be overcome by clear, cogent, and convincing evidenceIn re Estate of Borqhi. 167 Wn.2d 480, 484-85, 491-92, 219 P.3d 932 (2009). The appellate court agreed with the trial court that in this case the burden had been met and affirmed the trial court’s distribution of property.

Overall facts, it was a mid-length marriage – 13 years. The couple had lived in a home purchased by Husband 10 years before their marriage. They did several different projects on the home throughout their marriage and refinanced the mortgage. Husband also executed a quit claim deed that conveyed the property to both Husband and Wife and noted that the consideration of the conveyance is “to create community property.”

After concluding that the home was community property, the court found that an equal division of the assets was equitable. The court awarded the home to Husband and the three rental properties in Arizona to Wife, but the court awarded the proceeds from the post-separation sale of the Arizona vacation home to Husband.

Husband appealed claiming the trial court erred in characterizing the residential home as community property. The appellate court held that the quit claim deed and related documents show by clear, cogent, and convincing evidence Husband had converted his separate property to community property. The trial court and the appellate court rejected Husband’s claim that he did not intend to transfer the property – that he executed the deed merely to satisfy the bank’s requirement to secure the loan for the remodel. The appellate court held that he clearly executed the quite claim deed and his motive is irrelevant.

The court distinguishes this case from In re Estate of Borqhi, which was a State Supreme Court plurality decision involving a third party placing the title of real property the wife owned in both spouses name, but both spouses had passed away at the time of this case and there was no evidence in the record as to why the third party placed both names on the title. In this case, Wife’s name wasn’t simply added to the title, a quitclaim deed was executed, one thing the Borghi court explictly stated could transfer property and demonstrate intent to transfer property from separate to community.

The court also noted that more importantly to the characterization of the property that Husband did not contend or demonstrate that the trial court’s characterization of the residential home was crucial to its overall distribution of property or that the alleged mischaracterization resulted in an inequitable division of assets. Thus, even if Husband was correct regarding the legal characterization, he failed to establish an error in characterizing the property would be grounds for reversal.

Attorney’s fees on appeal denied.

Friday, November 7, Appellate Case Round-Up

There were not many cases that addressed family law in the last two weeks. There were two cases that touch on family law issues, both from Division One, both unpublished.

The Post Dissolution Property Dissolution Issues

In re Marriage of Gass and Abdel-Wahed, involved property distribution, and whether a party could use the homestead statute exemption. Basically, the couple divorced and Husband was awarded the home. Wife was awarded assets that Husband was supposed to provide along with an order of spousal maintenance.

Husband did not make the spousal maintenance payments and did not provide the wife with the assets. Husband was found in contempt.

The court issued a judgment for the past-due spousal maintenance and the value of the assets that should have been transferred, plus attorney’s fees, interest, and costs. The judgment ordered the marital home be sold. Through another order, Husband was removed from the home.

The home was sold. From the proceeds of the sale, Wife received the funds to cover spousal support. Husband sought to withhold the rest of the funds under the protection of the homestead statute. Wife argued that she should be able to receive the funds from the judgment for what was ordered to her at the time of dissolution. The trial court imposed a constructive trust to hold the funds pending a decision. Husband objected to the constructive trust.

The court of appeals held that Husband’s attempt to insert a homestead exemption argument and attempt to convert the decree into a lien under RCW 6.13.090, where the homestead statute would apply, was improper. The court noted that Homestead Statute exemption arguments cannot be used to facilitate unjust enrichment or fraud, and the court in equity may impose a constructive trust.

The court found that Husband’s failure to transfer money per the order was intentionally culpable conduct, basically, he was attempting to use the homestead exemption to avoid paying for the home.

The court also awarded attorney’s fees to the wife because it was a continuation of the original dissolution action and the losing party’s conduct constituted bad faith.

 

The Dependency Decision

The second decision falls out side of the classic definition of family law because it is a dependency action and is therefore between the state and a parent instead of being between private parties. In re Dependency of L.D. (family law cases involving minors normally do not use the child’s full name in an effort to protect the child’s privacy.)

While unpublished decisions cannot be cited by courts, they do some times provide information that is helpful in understanding how courts view issues. This case provides little guidance and is very much a fact-specific case. There were concerns noted about the child’s safety because of abuse of the child and abuse of the child’s mother as well as the father driving while intoxicated with the child.

The trial court found that the child was dependent and ordered services to be provided to the father. Subsequently, Father completed the domestic violence assessment and the child had been returned to his care. Because of this, the court found the issue the father raised about procedural due process was moot, meaning they were no longer relevant and the court would not issue an opinion on the matter.

 

Another Committed Intimate Relationship Case

A couple weeks ago, Division II issued an opinion regarding a Committed Intimate Relationship Case (CIR), which was blawged about here. In that case, the court said the a CIR cannot begin prior to a couple living together. On October 7, Division III addressed, whether a CIR has to be plead in  In re Neumiller

When a dissolution (divorce) is filed, a petition is filed, in Washington State, the Petition simply asks for the marriage date. For years, Jill Mullins-Cannon, has done presentations for attorneys representing same-sex couples and has advised practitioners to include the date the petitioner believes is the start date of the marriage-like relationship and list it separately so that there is no confusion about that date.

The Neumiller case presents the first discussion on whether the CIR date must be plead. At the trial level, the trial court said that it had to be plead earlier (in this case the petition was amended on date of the trail). The Court of Appeals disagreed and reversed this decision.

The Court of Appeals said that a CIR does not need to be in the pleading when it is “merely an evidentiary fact in a marriage dissolution proceeding.” The court said it’s an evidence issue and like evidence, it doesn’t have to be in the pleadings. It also wouldn’t be a discovery violation (when you don’t provide evidence to the other side that you should have provided) because the husband had knowledge of when they lived together and that the wife disagreed with his characterization of property as separate as opposed to community.

This case is important, especially for same-sex relationships that may have been in existence long before the law recognized those relationships. The CIR doctrine helps protect the community property and ensures a just and equitable distribution at the end of the relationship. This means that one partner does not become economically advantaged at the expense of the other other party. For same-sex couples in particular, it means that they won’t be put at a significant disadvantage from opposite-sex couples simply because the law didn’t recognize their relationship earlier. If they don’t file a petition that includes the start date of their CIR, that time will still be included in determining community and separate property.

It will be interesting to see whether the husband tries to appeal this case to the State Supreme Court. Regardless, best practice is still to include the CIR start date in pleadings. It is important to know upfront if there is going to be any disagreement about the start date of the CIR. Putting it in the pleadings will flag the possibility of a dispute at the outset of the case.