Family Law Prof Blog

Editor: Margaret Ryznar
Indiana University
Robert H. McKinney School of Law

Wednesday, December 9, 2009

Monopoli: "Marriage, Property and [In]Equality: Remedying Erisa's Disparate Impact on Spousal Wealth"

Paula Monopoli (University of Maryland School of Law) has posted "Marriage, Property and [In]Equality: Remedying Erisa's Disparate Impact on Spousal Wealth," Yale Law Journal Online, Vol. 119, p. 61-65 on SSRN.  Here is the abstract:

Congress is considering pension reform in the wake of the tremendous loss in market value of retirement plans during the current recession. This article suggests that this is a historic moment to remedy a previously unidentified, unintended but profound gender disparity embedded in the federal law governing retirement plans in this country. It explores the common perception that while contemporary law and policy aim to facilitate equality within marriage, including in the area of property ownership, embracing equitable distribution in reallocating property upon divorce, the Employment Retirement Income Security Act’s (ERISA) structuring of retirement asset accumulation runs counter to this trend and in fact incentivizes the concentration of wealth in the hands of husbands rather than wives within intact marriages. It suggests that in order to remedy this inconsistency and facilitate equality within intact marriages, Congress should amend ERISA to confer an immediate ownership interest in one-half of the assets in each spouse as they are earned and contributed by one spouse, akin to a community property theory of ownership. Each half should then be allocated to a separate account, one in each spouses’s name. While this second step may be somewhat inconsistent with the view of marriage as a partnership, it minimizes the risk that one spouse will dominate investment decisions with regard to the assets. In the alternative, ERISA should at least provide that each spouse’s defined contribution plan be held in a joint account as a default rule. A less fundamental but equally important additional reform would be to allow married couples to equalize ownership by transferring unlimited amounts between their accounts without triggering income taxation and the 10% early withdrawal penalty. This would be akin to the existing unlimited marital deduction as applied to transfers under the current federal gift tax. The article concludes that, with these amendments, Congress could align federal pension law with the overall movement toward gender equality in marital property law.

AC

December 9, 2009 in Property Division | Permalink | Comments (2) | TrackBack (0)

Tuesday, December 8, 2009

Are the Christmas Gifts You Give Your Spouse Community Property?

Maybe.  A California Court of Appeals just ruled (reversing the lower court's decision) that a Porsche bought for husband with wife's separate funds was to be classified as community property.  California law generally requires a writing to transmute the classification of property, but there is an exception for gifts of "tangible articles of a personal nature."  The California court held that a Porsche was not such property.  Read the full opinion here.  And if you're in a community property state, delight in the fact that you'll still own a portion of most items you gift to your spouse!

AC

December 8, 2009 in Property Division | Permalink | Comments (1) | TrackBack (0)

Thursday, October 29, 2009

Are the Dodgers Community Property?

We'll find out soon enough.  With the filing of a petition for divorce on Tuesday, Jamie and Frank McCourt have begun what seems likely to become a long and bitter divorce battle.  Among the issues raised in the petition for divorce is ownership of the Los Angeles Dodgers.  Frank claims he is the sole owner of the team.  Jamie claims the team is community property.  A 2004 marital property agreement executed just after the Dodgers purchase indicates that the team may be Frank's separate property.  No doubt the enforceability of that agreement will be questioned, and there are reports that Frank himself did not believe the agreement made him sole owner of the team.  Read early news coverage of the case here and here.

AC

October 29, 2009 in Property Division | Permalink | Comments (0) | TrackBack (0)

Tuesday, October 20, 2009

Working Around Preemption of Community Property Rules

When spouses in a community property regime hold certain federal assets, the doctrine of preemption often results in the inability of state community property law to step in to regulate their classification.  The United States Supreme Court's decision in Boggs v. Boggs is a classic example in the pension context, though there are countless other such assets (intellectual property, IRAs, social security benefits, just to name a few).

Louisiana has an interesting 2001 statute clearly designed to work around preemption (La. Rev. Stat. 9:2801.1).  It provides:

When federal law or the provisions of a statutory pension or retirement plan, state or federal, preempt or preclude community classification of property that would have been classified as community property under the principles of the Civil Code, the spouse of the person entitled to such property shall be allocated or assigned the ownership of community property equal in value to such property prior to the division of the rest of the community property...

A Louisiana appellate court, in the first decision directly applying the statute, recently approved use of the statute to allocate more community property to wife because preemption required that her husband's social security benefits, earned through effort expended during the marriage, be classified as husband's separate property.  The opinion includes no discussion of the constitutional implications of so blatantly undermining the result of the preemption doctrine.

Are there other examples of state law which so clearly undermine federal preemption?

AC

October 20, 2009 in Property Division | Permalink | Comments (0) | TrackBack (0)

Wednesday, October 14, 2009

Marriage as a Lottery?

Some people may think they win the lottery solely by marrying their soul mates.  Others may think, in the age of high divorce rates, that to achieve life-long marriage is to hit the jackpot.  A recent newspaper article in Bermuda, however, suggests that divorce laws favoring near equal property division between spouses, particularly in the United Kingdom (as covered in a recent post), transform marriage into a big lotto payday upon divorce.  From the view of higher income spouses, therefore, one needs to potentially pay to play in the marriage game.  From the view of lower income spouses, there may be an incentive to view marriage as a career choice, or lotto ticket.  Marriage as a lottery--quite the multi-layered metaphor!

Luckily, it's still a more pleasant lottery to play than Shirley Jackson's.

                                                                    Cards

MR

October 14, 2009 in Property Division | Permalink | Comments (0) | TrackBack (0)

Wednesday, January 14, 2009

Kidney as marital asset?

Images In a case from NY that sounds like an examination question, the legal issue might be expressed as whether a kidney is a marital asset. 
According to the BBC,

He said he had not only given his heart to his wife, Dawnell, but donated his kidney to save her life.

But divorce lawyers say a donated organ is not a marital asset to be divided.

Dr Batista married Dawnell in 1990 and donated the kidney to her in 2001. She filed for divorce in 2005 and a settlement has still not been reached.

CBS has some videos here, as well as an analysis of how valuable the kidney might be (she had other relatives who might have donated a kidney).  More coverage (local) by Newsday here, which will be the site to watch for updates.

RR

January 14, 2009 in Property Division | Permalink | Comments (0) | TrackBack (3)

Friday, August 24, 2007

Case Law Development: QDRO Sole Route to Waiver of Pension Rights

The Fifth Circuit Court of Appeals holds that a QDRO is the only route to waiver of pension rights upon divorce.  This case involved Decedent-Husband, who was a DuPont employee and participant in its savings and investment plan (SIP). Decedent had signed a beneficiary-designation form in 1974, identifying Wife as the SIP’s sole beneficiary. Decedent and Wife were divorced in 1994. In the divorce decree, Wife agreed to be divested of “all right, title, interest, and claim in and to … the proceeds therefrom, and any other rights related to any … retirement plan, pension plan, or like benefit program existing by reason of [decedent’s] employment.” However, no QDRO was ever submitted to DuPont.  Decedent never changed or removed the Wife as the SIP beneficiary. 

Decedent’s estate demanded DuPont distribute SIP funds to the estate, claiming that Wife’s beneficiary designation was invalid under the Texas Family Code, which provides that spousal beneficiary designations are rendered invalid by a divorce.  While the district court held that federal law preempted state law, it found that a federal common law approach applied, allowing waiver of the benefits.

The court of appeals reversed, finding that the anti-alienation provision of ERISA applied to this plan because it was a pension plan, distinguishing the district court’s common-law waiver approach as having been applied only to life insurance plans, to which the anti-alienation provision does not apply.Moreover, the court rejected the estate’s argument that a “waiver” is not an “alienation” and thus does not run afoul of the anti-alienation provision.  Rather the court concluded that:

In the marital-dissolution context, the QDRO provisions supply the sole exception to the anti-alienation provision, they exempt a state domestic-relations order determined to be a QDRO, under the standards set forth in ERISA… When, as here, ERISA provides a specific mechanism – the QDRO – for addressing the elimination of a souse’s interest in plan benefits, but that mechanism is not invoked, there is no basis to formulate a federal-common-law rule. Requiring DuPont to recognize the waiver in this situation would conflict with ERISA by purporting to determine rights to pension-plan benefits in a manner not authorized by the QDRO provisions, 29 U.S.C. § 1056(d)(3), and therefore, not permitted by the anti-alienation provision, 29 U.S.C. § 1056(d)(1).

Kennedy v. Plan Administrator for DuPont Saving and Investment Plan, U.S Court of Appeals for the Fifth Circuit, August 15, 2007
Opinion online (last visited August 24, 2007 bgf)

August 24, 2007 in Property Division | Permalink | Comments (0) | TrackBack (0)

Saturday, August 18, 2007

Case Law Development: Contempt Appropriate Remedy for Failure to Abide by Divorce Decree's Hold Harmless Provision

In a divorce decree, Husband was ordered to make certain credit card and mortgage payments and to hold Wife harmless with regard to the debts. Husband failed to do so and Wife requested that he be held in contempt.  The trial court ruled that it could not use contempt as a remedy for failure to abide by hold-harmless agreements.  The Indiana Court of Appeals reversed, holdindg that while contempt could not be used to remedy noncompliance with a money judgment, Ind. Code § 31-15-7-10(1) made contempt an available remedy for other noncompliance with a dissolution decree.  Because the noncompliance in this case did not involve a money judgment, the trial court could properly use its contempt powers to enforce the order.

Mitchell v. Mitchell, 2007 Ind. App. LEXIS 1805 (August 8, 2007)
Opinion online (last visited August 18, 2007 bgf)

Continue reading

August 18, 2007 in Property Division | Permalink | Comments (0) | TrackBack (0)

Friday, August 3, 2007

Case Law Development: Division of Increased Value of Separate Property in Missouri Explained

The Missouri Court of Appeals reviewed the division of the increased value of several pieces of real property that were Husband's separate property in an opinion that nicely demonstrates the operation of the "proportionate share" approach to dividing increased value. 

The case involved a couple who were divorcing after thirteen years.  They had entered into a antenuptial agreement before the marriage that declared that each party would keep their separate property as separate; however, Husband failed to plead the antenuptial as an affirmative defense so that the court of appeals held that the trial court had erred in allowing the agreement to be introduced into evidence.

The properties at issue included some unimproved land Husband had owned before the marriage and an additional parcel of land he inherited during the marriage.  Under Missouri law, property owned before marriage or acquired by gift, bequest or devise is separate property.  However, Missouri also applies the rule that income from separate property is marital and the the increase in the value of separate property may be considered marital to the extent it is the product of marital contributions.  The trial court had held that the entire equity of both parcels was marital property because of improvements that were financed by rental from the properties and loans paid by marital funds.  However the court of appeals reversed the trial court's calculation, noting that the increased value that is marital should be determined by a percentage reflecting the ratio of marital contribution to total contributions. 

The case provides detailed financial accounting for each item of property and would make an excellent exercise for students in considering the various approaches used to divide increase in value.

Holman v. Holman, 2007 Mo. App. LEXIS 1073 (July 26, 2007)
Opinion online (Last visited August 2, 2007 bgf)

August 3, 2007 in Property Division | Permalink | Comments (0) | TrackBack (0)

Thursday, August 2, 2007

Case Law Development: Dividing Proceeds of Wrongful Death Award upon Divorce

The Iowa Supreme Court addressed equitable division of a wrongful death award.  The case involved a couple who were divorcing after a 22-year marriage.  Fifteen years earlier, the couple's oldest son was killed in an auto accident.  His mother witnessed the accident.  Both parents filed wrongful death actions and settled their separate claims, with mother receiving a settlement of over $400,000 more than father.  Both parents received payments on the settlements, which were treated as marital income by the couple.  Upon divorce, the court divided the future payments made to either party to be divided equally.  Mother argues that  she should have been awarded a larger share of the payments because the difference between her and her husband's awards represented the compensation for the emotional distress she suffered from witnessing the accident.  However, the court was unable to determine the portion of the award that was attributable to her emotional distress and concluded that an equal division of the award was not inequitable.

In re Marriage of Arends, 2007 Iowa App. LEXIS 846 (July 25, 2007)
Opinion online (last visited August 1, 2007 bgf)

August 2, 2007 in Property Division | Permalink | Comments (0) | TrackBack (0)

Tuesday, July 31, 2007

Case Law Development: Dividing Increase in Asset Value

In a case that would provide a fine basis for a class discussion problem, the Supreme Court of Iowa considers equitable distribution of asset appreciation in a 15-year marriage.  The court held that the trial court had erred in not dividing the increase in the value of both spouses’ premarital assets.  The trial court had awarded each spouse the passive increase in the value of their premarital assets but had divided the increase it attributed to marital efforts. 

The Supreme Court reversed, finding that marital contributions were of little help in determining what was equitable in a 15-year marriage: 

We do not find the parties’ respective contributions to the marriage justify treating the parties differently. Michele’s biggest criticism of Ted is his “failure without good cause to contribute financially to the marriage consistent with his earning capacity.” However, we have never held or even insinuated that spouses should maximize their earning potential or risk being punished in the distribution of the parties’ property.

Iowa is a no-fault state. … It is important to remember marriage does not come with a ledger. … Spouses agree to accept one another “for better or worse.” Each person’s total contributions to the marriage cannot be reduced to a dollar amount. Many contributions are incapable of calculation, such as love, support, and companionship. “Financial matters . . . must not be emphasized over the other contributions made to a marriage in determining an equitable distribution.” … Nor do we find it appropriate when dividing property to emphasize how each asset appreciated—fortuitously versus laboriously—when the parties have been married for nearly fifteen years.

The court did, however, allocate to husband $22,000 of debt that he had incurred after wife’s petition for divorce.  Because husband was unable to explain why he had incurred this debt or how it had been spent, the court found it equitable to allocate this debt exclusively to husband.  The opinion provides a fine summary of Iowa law on dissipation of marital assets and division of debt.

In Re Marriage of Fennelly, (July 20, 2007)

Opinion online (last visited July 30, 2007 bgf)

July 31, 2007 in Property Division | Permalink | Comments (0) | TrackBack (0)

Tuesday, June 5, 2007

Largest Divorce Award in History?

"An energy magnate's estranged wife was awarded $184 million Monday in what appears to be one of the biggest divorce verdicts in U.S. history.

Citing irreconcilable differences, Maya Polsky, a 55-year-old art gallery owner, filed for divorce from her husband, Michael Polsky, in 2003.

Judge William Boyd ruled in October that Maya Polsky was entitled to half of the Chicago couple's cash and assets, with her share valued at $176 million. On Monday, the judge amended his decision to include previously omitted assets that increased the value of her award to $184 million.

Maya Polsky's attorney, Howard Rosenfeld, said more than $170 million of the award is nontaxable cash. He said that in researching the case he could find nothing in which a homemaker wife received such a significant award.

"She's very much satisfied with the court's decision. She thinks she was fairly treated by the court," Rosenfeld said."  AP, CNN.com Link to Article (last visited 6-5-07 NVS)

June 5, 2007 in Property Division | Permalink | Comments (1) | TrackBack (0)

Monday, February 26, 2007

Case Law Development: The Costs of Divorce

The Missouri Court of Appeals decided a case involving a divorce from a 27-year marriage in which maintenance, division of property and attorneys fees were disputed.  The court affirmed the trial court's decision to award maintenance to wife, who had been a homemaker for most of the marriage and who had health problems and few job skills, and to award her a portion of the husband's retirement account, as well as the decision to award attorneys fees. 

That the trial court's decisions were upheld is not particularly surprising given the high degree of deference given to trial courts on these issues and the fact that Missouri allows marital fault to impact these decisions. 

What is striking about the case from a teaching perspective are the numbers:

Wife stayed at home for most of the marriage and never had earned more than $2000 a year. 
At the time of trial, Husband had a monthly income of $3900, working as a machinest.

The couple had arrived at a settlement agreement and divided most of their marital property and debts.  After the trial court divided the retirement account, the total property Wife received under the judgment was $9908. The total value of the property awarded to Husband, less the marital debt, came to $14,341. The trial court ordered Husband to pay modifiable maintenance to Wife in the amount of $550 per month.

Each party incurred about $3000 in attorneys fees for the dissolution action. For the appeal, Wife was awarded $6000 attorneys fees for her representation on appeal; Husband paid $18,000 for his representation on appeal.

Russum v. Russum, February 20, 2007
Opinion on the web (last visited February 26, 2007 bgf)

February 26, 2007 in Attorneys, Maintenance (alimony), Property Division | Permalink | Comments (0) | TrackBack (0)

Thursday, February 15, 2007

Case Law Development: Use of Liens to Secure Divorce Judgments to Be Paid Over Time

The Iowa Supreme Court reviewed a property division in an unusual case involving a couple who, during their 10-year marriage, built up a business together with assets of over ten million dollars, but who kept all the business assets in wife's name to protect them from creditors.   The trial court had ordered that wife be granted the business assets but that she make payments to her ex husband over a period of  years, with each payment to become a judgment when due.  The court granted husband an equitable lien on the company to secure these payments. 

However, the Iowa Supreme Court found the trial court's approach to leave husband with too little protection.  First, the court found that the trial court should have issued a judgement for the entire amount, with an allowance of periodic payments, so that a judgment lien would attach to the business's real property. Second, it found the trial court's refusal to assess interest on the judgment to be in error.  Finally, it reversed the grant of the equitable lien, finding a combination of a judgment lien and a UCC lien to be the best combination of protections for the ex husband.

In re Keener, 2007 Iowa Sup. LEXIS 13 (February 9, 2007)
Opinion on web (last visited February 11, 2007 bgf)

February 15, 2007 in Property Division | Permalink | Comments (0) | TrackBack (0)

Sunday, January 21, 2007

Divorcing Couple Divide House - Literally

The BBC News reports that a bickering New York couple have had a dividing wall constructed inside their home as part of an acrimonious divorce. Chana and Simon Taub, both 57, have endured two years of divorce negotiations, but neither is prepared to give up their Brooklyn home.  Now a white partition wall has been built through the heart of the house to keep the pair apart. Mr Taub asked a judge to allow him to erect the partition when the couple's divorce stalled over financial details.

Read the story and see the picture (last visited January 22, 2006 bgf)

January 21, 2007 in Property Division | Permalink | Comments (0) | TrackBack (0)

Wednesday, December 13, 2006

Case Law Development: Kentucky Rejects Distinction between Enterprise and Personal Goodwill

In a case in which the value of wife's solo medical practice was the subject of considerable dispute, the Kentucky Court of Appeals refuses the invitation to join the majority of state that distinguish between enterprise goodwill and personal goodwill in valuing a business upon dissolution.  The court reviewed a number of cases from other jurisdicitons on either side of the issue and concluded that "After considering the issue and the facts of this case, we are not inclined to deviate from long-standing precedent by creating a wholesale change of law holding that "personal" and "enterprise" goodwill should be distinguished for purposes of property valuation in a divorce proceeding - even given that [Wife's] practice is a sole proprietorship. Issues of stare decisis aside, we believe that "[i]t would be inequitable to hold that the form of the business enterprise can defeat the community's interest in the professional goodwill. Such a result ignores the contribution made by the non-professional spouse to the success of the professional ...."  The court noted that the husband made a number of contributions directly to the wife's medical practice, including "training a number of administrative personnel and handling a number of financial aspects of the practice."

A dissenting judge found the arguments in favor of distinguishing between the two forms of goodwill, but agreed with the majority that that matter was for the Kentucky Supreme Court.

Gaskill v. Robbins, 2006 Ky. App. LEXIS 364 (December 8, 2006)
Opinion on the web (last visited December 13, 2006 bgf)

December 13, 2006 in Property Division | Permalink | Comments (1) | TrackBack (0)

Wednesday, October 25, 2006

Case Law Development: Division of Debt Caused By One Partner Spouse's Criminal Conduct

Just in time for Halloween, the Michigan Court of Appeals decides a case in which the husband's arguments for assigning fault in the characterization of debt as marital sound like something an Edgar Allen Poe character would construct.

The case involved a division of debt owed to the insurance company due to husband's actions in burning down the marital home on the evening after Wife had left the home and announced her intention to get a divorce.  The trial court allocated to Husband all of the $300,000 is restitution owed to the insurance company. Husband argued that Wife should split that debt with him because he had acted in response to her adulterous affair. 

The court of appeals affirmed, in its unpublished opinion, concluding:

We agree with the trial court that it is difficult to take seriously defendant’s
contention that his wife’s affair so outraged him as to make his act of arson her fault when
indeed he had conducted numerous affairs himself during the course of the marriage. We find illogical, and distasteful, defendant’s attempts to characterize his conduct as different from his wife’s conduct for the reason that he never intended his affairs to end the marriage, while she did. We find puzzling defendant’s suggestion that the trial court should have, and this Court should now, consider the alternative scenario where defendant’s conduct resulted from being physically poisoned by his wife. In short, we find no error in the trial court’s assessment of fault in the breakdown of this marriage.

The court noted that "the courts of this state have not spoken specifically to the issue of whether an innocent spouse may be liable for criminal restitution debt incurred by the partner spouse during the course of the marriage, probably because such an illogical and unreasonable argument has not before been made."

Thanks to Jeanne Hannah, of the Updates in Michigan Family Law Blog, for highlighting this case!

League v League, 2006 Mich. App. LEXIS 3063 (October 19, 2006)
Opinion on the web (last visited October 24, 2006 bgf)

October 25, 2006 in Property Division | Permalink | Comments (0) | TrackBack (0)

Friday, October 20, 2006

Case Law Development: No Duty to Disclose Pending Sales Discussions of Property in Divorce Settlement

The New York Court of Appeals dismissed an action to set aside a divorce settlement in a high-dollar divorce between Actress Lora Kojovic and her husband Neal Goldman, who owned a minority share of an Internet information service Capital IQ.  Wife signed a divorce settlement agreement in August 2004 that gave her nearly $1.5 million.  However, about one month later, Standard & Poor's purchased her husband's company for $225 million, with his share being $18 million.   Wife then brought an action to set aside the settlement agreement on the basis of fraud and unconscionability.

Wife argued that husband affirmatively misrepresented the liquidity of the company and the talks that were underway for purchase of the company.  However, the court disagreed, finding that husband had disclosed the assets and that it was up to wife to inquire further.  However, wife, who had been represented by counsel in negotiating the agreement, had acknowledged that she had the right to inquire further into the financial aspects but waived this right.

The court noted its "disdain for post-divorce claims of concealment" and found that "[T]he wife concedes, as she must, that the husband consistently and accurately disclosed the full extent of his minority interest in Capital IQ, an asset of speculative value at the time the settlement agreement was executed... That the wife now believes her husband privately harbored a more optimistic assessment of the potential value of his minority interest in that company, or even had additional information that he kept to himself, is irrelevant... wife has only herself to blame for her failure to inquire further. Such failure is not, however, a basis upon which to vacate the settlement."

"... given her professional background and the advice furnished by her counsel and accountant, [wife] should have been aware of the distinct possibility that Capital IQ would be sold," the panel held. "That she opted for an immediate and certain payout instead of the uncertainty of an eventual sale does not afford a basis for setting aside the agreement."

Kojovic v. Goldman, (NY App. Div. October 19, 2006)
Opinion on the web (last visited October 20, 2006 bgf)

October 20, 2006 in Property Division | Permalink | Comments (0) | TrackBack (0)

Friday, September 29, 2006

Case Law Development: Third-Party Interests in Marital Property During Divorce

Students often have trouble conceptualizing how a court might treat the interests of third parties in marital property.  This case from the Alabama court of appeals provides a somewhat tidy example:

During the marriage, Husband purchased about 15% of the shares in a closely held corporation, using marital funds.  All the shareholders in the corporation had a buy-sell agreement, giving them the right to purchase stock in the event of an involuntary transfer being ordered.  In a subsequent divorce, the trial court ordered Husband to transfer to Wife 300 shares of the stock or to pay to her the agreed price from the buy-sell agreement.  The court of appeals of Alabama reversed, finding no error in the trial court's order to Husband to transfer the stock, but holding that the court failing to order that the company and the other shareholders have the right to purchase the shares awarded to the wife. The court reversed and remanded the entire property division and maintenance award on the basis of this error (one judge dissented on the basis that the order's allowance to Husband that he could pay the buy-sell agreement price in lieu of transferring the stock was sufficient protection of the shareholders). 

In a second appeal arising out of the case, the shareholders had sought to intervene in the divorce action, but the court found no right to intervene  because the husband, who was both a shareholder in the food company and a party to the buy-sell agreement, opposed the trial court's making an in-kind award of stock to the wife, and thus adequately represented the interests of both the company and the other shareholders. 

Kelley v. Kelley, 2006 Ala. Civ. App. LEXIS 579 (September 22, 2006 bgf)

September 29, 2006 in Property Division | Permalink | Comments (0) | TrackBack (0)

Wednesday, September 6, 2006

Case Law Development: Waiver of Trial De Novo of Arbitration Awards

The Oregon Court of Appeals has held that parties cannot by their agreement convert a court-annexed arbitration of property division in divorce into a binding arbitration under the Oregon Arbitration Act, thereby divesting the trial court of its authority to conduct a trial de novo.  However, the court did conclude that parties could waive their right to seek such a review, rejecting an argument that allowing waivers of trials de novo would violate public policy.

In the case before it, however, the court concluded that the parties' agreement that their arbitration would be binding, subject only to appeal to the court of appeals, was based on a mutual mistake in that appellate review was not available from arbitration awards.   Thus the court found this mistake made any waiver of a trial de novo it might have implied to be invalid.

Woods v. Woods, 2006 Ore. App. LEXIS 1242 (August 30, 2006)
http://www.publications.ojd.state.or.us/A124747.htm

September 6, 2006 in Property Division | Permalink | Comments (0) | TrackBack (0)