June 14, 2007
Judges Orders Man not to have a Girlfriend
The Associated Press reports that a judge has ruled that a 24-year-old Canadian man is not allowed to have a girlfriend for the next three years. The ruling came after Steven Cranley pleaded guilty on Tuesday to several charges stemming from an assault on a former girlfriend. Cranley, who has been diagnosed with a dependent personality disorder, attacked his girlfriend in an argument after their breakup.
Read the New York Times story (last visited June 14, 2007 bgf)
Case Law Development: Prerequisites for Order to Arbitrate of Divorce Actions
A three-judge panel of the Michigan Court of Appeals reverses a divorce court's grant of default judgment against Husband based on his refusal to participate in arbitration. An important issue in the case was when the parties separated (the case provides great facts for a hypothetical on this issue). The litigation at trial was complicated by being heard by three different judges, none of whom had provided the necessary disclosures regarding arbitration required by Michigan's domestic relations arbitration statute. The majority held that the trial court erred in granting default judgment in light of is failure to comply with the requirements of the statute regarding written agreements to arbitrate and judicial disclosures regarding the process.
The dissent by Judge Murray agreed that the trial court had not complied with the statutory requirements but would have upheld the default judgment as a sanction for the Husband's failure to comply with a court order. The concurring opinion by Judge O'Connell agrees that, while litigants must obey court orders, court must equally follow statutory dictates. The exchange between the two judges in their opinions provides a lovely example of policy argumentation for our students. For example, Judge O'Connell argues:
plaintiff was ordered to forego recourse to our primary institution of justice, surrender his rights, and submit the substance of his legal dispute to the discretion of an unknown, unelected, unappointed, and largely unaccountable third party. Although our courts have always respected a party's consent or contractual freedom to take a more streamlined approach to dispute resolution, they have never shirked their constitutional duty by requiring litigation in an alternative, unofficial forum. ... Domestic relations necessarily involve personal, rather than pecuniary, issues, so our legal system has been especially slow to sanction extrajudicial resolution of any of these matters, even when founded on the parties' mutual assent.
Johnson v. Johnson, 2007 Mich. App. LEXIS 1480 (June 7, 2007)
Case Law Development: Dischargeability of Mortgage Payments Required by Divorce Decree
In a chapter from a "protracted and ugly" divorce case, the bankruptcy court held that a Husband's obligation to "assume and pay and hold [Ex-Wife] harmless from . . . the second mortgage on the parties' home" was in the nature of support and thus was not dischargeable in bankruptcy. The case would be useful for students to read not only for the bankruptcy analysis, but as a demonstration that securing a divorce decree is only the first step in enforcing support obligatiosn. As the court here noted, the husband's attempts to discharge the mortgage obligation "has almost exhausted the resources of both the federal and state courts of Utah."
As to the characterization of the obligation itself, the court noted that whether an order is in the nature of support is a matter of federal bankruptcy law, so that "a debt could be in the 'nature of support' under [bankruptcy law] even though it would not legally qualify as alimony or support under state law." Here the court correctly determined that to the extent the mortgage obligation was premised on the right of the Debtor's children to live in the home until age 18.
The court split on the issue of whether attorneys fees were properly awarded.
Busch v. Hancock (In re Busch), US Bankruptcy Appellate Panel of the 10th Circuit (June 4, 2007)
Read opinion (last visited June 14, 2007 bgf)
Case Law Development: Characterizing Awards for Tax Purposes
The tax court, in a recent summary opinion, provides a good example for our students of the importance of careful drafting in light of the interrelationship between the tax code and state law when determining the tax consequences of divorce. In this case, the divorce decree provided that Husband would pay Wife $1200 a month in “rehabilitative alimony” and an additional $72,000 in “lump-sum alimony”, payable in installments of $600 a month. The decree did not indicate whether this lump sum
award would terminate upon Wife’s death.
Under section 71(b) of the tax code, alimony is not deductible if it does not terminate upon the payee spouse’s death. Because the Florida courts have held that an award of lump-sum alimony survives the death of both the obligor and the obligee, the alimony was not properly deductible.
Hinson v. Commissioner, US Tax Court Summary Opinion 2007-92 (June 7, 2007)
Read opinion (last visited June 14, 2007 bgf)