How To Catch Your Cheating Spouse? Get a Parrot.

Posted by Daniel Clement on June 29, 2007

I thought it would be great to end a hot summer week with three strange tales of  parrots ratting out their owners, who were committing adultery.  Thanks to Stephen Worrall at the Georgia Family Law Blog for finding this piece on DarnDivorce.  

parrottalk.jpg:November 19, 1937: According to the LA Times, Mr. James J. Reynolds wanted to put his parrot on the stand to testify concerning its knowledge of the domestic affairs of him and his wife by showing that the bird had learned to call Reynolds certain abusive names and that the bird’s teacher could have been none other than Mrs. Reynolds. Superior Judge Brand, however, refused to allow a parrot to testify declaring the procedure was a little too irregular in that the parrot probably could not be placed under oath and furthermore probably could not recall who had taught it anything it might have learned.”

November 28, 2005: Frank Ficker of Freiburg (try saying that five times straight) thought he had it all: successful wife, nice home, and a mistress on the side. But the family parrot, a pro at imitating Frank, spilled the beans on his cheating ways. That’s how Mrs. Ficker found out about her husband’s affair with a woman named Uta. “Hugo always liked to mimic Frank and he could do his voice perfectly,” said his wife. But one day Mrs. Ficker heard the bird repeating something she’d never heard before. “I heard him doing Frank’s voice, but saying ‘Uta, Uta,’” she said. According to DW-World, the unfamiliar word got the wife searching their house where she eventually came across two plane tickets to Paris, one for Frank, another for Uta (who was, evidently, the other woman.) “I kicked him straight out,” she said. “It’s just me and my parrot now.” Divorce proceedings are pending.

February 27, 2006: Argentina - Angry wife Rosella DeGambos got her blabbermouth parrot Bozo to testify in court, who then spilled all the family secrets within a two-hour appearance. “I knew he’d seen everything that my husband Carlos did when my back was turned,” Mrs. DeGambos said in an interview about her bizarre divorce court ploy. “And I knew he had the vocabulary to describe what he’d witnessed. According to Nature’s Corner, the parrot described three “pretty dollies” that Carlos had “tickled” while his wife was away. He also identified the women in photographs, calling them by their correct names. “I used to think that Carlos was a faithful husband but Bozo let me know about a year ago that something was up when I wasn’t home,” Mrs. DeGambos said. “He was using new words, words of love. And he began giggling in a high-pitched feminine voice. He kept saying, “No Carlos, not here,” and things like that. I knew if the lawyers could get him to testify, there was plenty of information they could get from him.” Shown one picture of the 23-year-old beautician Carlos allegedly wooed in his home, the bird shrieked, “Honeybun, I love you.” When Mrs. DeGambos’ attorney asked the bird, “Who loves Carlos?” the winged witness said, “Ruby loves Carlos, Ruby loves her baby.” Coincidently, Ruby is DeGambos’ young and voluptuous secretary. Judge Agusto, let Bozo’s testimony stand and granted the Mrs. her divorce. The first such ruling in the world.

I guess if you are going to cheat on your spouse, you better keep it secret from your pet as well.

A Parent's Obligation to Pay for College Does Not Include Graduate Studies

Posted by Daniel Clement on June 27, 2007
A father, who had agreed to contribute to his child’s college education, was not responsible for contributing to the costs of the child’s post-graduate degree. In the recently decided case of Robinson v. Gerny (New York Law Journal) (subscription required), the Court ruled that “The word ‘college’ denotes attendance at an undergraduate program resulting in a bachelor’s degree.”

The Court ruled that the fact that the child was seeking a graduate degree was not “contemplated as within the plain meaning of college.”

This dispute could have easily been prevented by carefully drafting the parties’ settlement agreement. It is not uncommon to provide in a settlement agreement that child support will be paid for so long as a child is registered and attending an undergraduate degree on a full time basis. Indeed, Justice Pines decided this case by applying basic tenets of contract construction, giving words and phrases their plain and ordinary meaning.

If there is a lesson to be learned from this case, it is that the scope and duration of a party’s obligation to contribute to a child’s higher education should be clearly defined in clear and unambiguous language

How Much Child Support is Too Much - Ask 50 Cent

Posted by Daniel Clement on June 26, 2007
Rapper 50 Cent is seeking a modification of the order which required him to pay $25,000 as child support for his son. According to ABC News, the mother says this amount is inadequate, particularly since 50 Cent earned $33 million last year.

Child support is calculated as a percentage of income. Problems arise when the non-custodial parent’s income is so large that the calculation results in absurd amount of child support.

In New York, the child support guidelines are to be applied to the parents’ combined income up to $80,000. The court has discretion to apply the guideline percentage to the income in excess of $80,000. The real question becomes, at what point should the guidelines cease to be applied? Should, for instance, the guidelines be applied to all of 50 Cent’s $33 million annual income?

As the Maryland Family Law Blog points out, there is a presumption that parents who earn more, spend more on their children.

While 50 Cent’s obligation to pay $300,000 per year as child support seems, at first blush, exorbitant, consideration has to be given to the lifestyle the child would have enjoyed if he lived with his father. 50 Cent reportedly came to court in an armored SUV equipped with a satellite dish. Shouldn’t the child be able to enjoy some of the luxuries and the lifestyle commensurate with his father’s income and lifestyle?

The Basics of Divorce and Taxes

Posted by Daniel Clement on June 22, 2007
The Oklahoma Family Law Blog highlights some of the basic tax concerns that need be considered in connection with divorce.  

• Alimony is taxable and deductible. The person who provides alimony can claim the payments as a deduction, while the person who receives it can avoid a large end-of-year tax bill by paying estimated taxes during the year. Unlike alimony, child support is not deductible or taxable.
• Who claims the children? The parent who has custody of a child usually can claim the child as a dependent. However, with the custodial parent’s consent, the parent without custody can claim the child. (The custodial parent may still be able to claim certain tax benefits related to the child, including head of household filing status, the Earned Income Tax Credit, and the child-care credit.)
• Who is a head of household? There are several factors for determining the head of a household. A few include being considered “unmarried” on the last day of the year, having children or other dependents who live with you, and paying more than half the cost of providing a home for dependents. Taxpayers should consult with a tax professional to determine if they qualify for head of household status.
• Divorce, annulment and legal separation are considered the same by the IRS for tax purposes. The way a tax return is affected by the situation depends on how the decree is worded, and in cases where state and federal law differ, the IRS will side with the federal government.

Taxes may even be used to facilitate settlements. For instance, by using the differential in tax rates between spouses, a settlement can be structured so that, in essence, taxes subsidize some maintenance payment.

For this reason I suggest that a settlement proposal be examined by a tax professional or a certified divorce financial planner.

How is child support calculated in New York?

Posted by Daniel Clement on June 21, 2007
Child support in New York is calculated pursuant to the Child Support Standards Act ("CSSA") (Domestic Relations Law §240(1-b) and Family Court Act § 413(1)(b)).

To simplify, CSSA provides that unless the court finds that the non-custodial parent's pro rata share of the "basic child support obligation" to be unjust or inappropriate after considering the ten enumerated factors, it must order the non-custodial parent to pay his or her pro rata share of the "basic child support obligation".

The "basic child support obligation" is calculated by multiplying the "combined parental income" by the appropriate "child support percentage. Income" is defined as "gross income as was or should have been reported on the most recent federal income tax return" less deductions for, inter alia, social security and New York City and Yonkers income taxes.

The "child support percentage" is fixed at:

a)17% of the combined parental income for one child;
b)25% of the combined parental income for two children;
c)29% of the combined parental income for three children;
d)31% of the combined parental income for four children; and
e)no less than 35% of the combined parental income for five or more children.

Where the combined parental income exceeds $80,000 per year, the court has discretion to depart from the child support percentages as to those portions of income in excess of $80,000.00.

So, what does this really mean? Let's suppose, a mother, with an income of $30,000 after social security and New York City taxes , is the custodial parent of two children. The Father’s income is $50,000 after social security and New York City taxes

The couple’s combined annual income is $80,000. Since there are two children, the applicable guideline percentage is 25% or $20,000 per year.  The father’s share of the child support payment is 5/8 of $20,000 or $12,500 per year or $1,042 per month.

Where the combined parental income exceeds $80,000 per year, the court has discretion to depart from the child support percentages as to those portions of income in excess of $80,000.00.

In addition to ordering the payment of child support, the Court can order the non-custodial parent to pay his\her pro rata share of the children's un-reimbursed health care expenses, the child care expenses when the custodial parent is working or attending school, the children’s educational expenses, as well as the costs of extra-curricular activities.

Divorce and Taxes: How to Avoid Costly Mistakes

Posted by Daniel Clement on June 14, 2007
The Wall Street Journal in an article entitled Divorce: Counting Money Gets Tougher, highlights the common mistakes made by unwary litigants. These mistakes can have dire tax consequences.

Some common blunders: Dividing a stock portfolio down the middle without checking for losses or gains -- which can trigger either a tax break or a big capital-gains tax hit.

There are steps you can take to avoid house-related tax hits. If you keep the house and retitle it in your name, but end up selling it after the split, you may be able to shield only as much as $250,000 of the gains from capital-gains taxes. Consider selling the house while you're still married, or include specific provisions for the sale of the house in the divorce decree, to shield as much as $500,000 from capital-gains taxes.

The QDRO -- short for Qualified Domestic Relations Order -- is a court order that spells out who gets what in an employer-sponsored retirement plan such as a pension or a 401(k). QDROs must be approved by both the employer's retirement-plan administrator and the divorce-court judge.

The document lets you make transfers to an Individual Retirement Account, or make early fund withdrawals from the plan without paying the usual 10% IRS penalty if you're under age 59½. (You'll still have to pay income taxes on withdrawals.)

Try to complete the QDRO before the divorce is finalized. Otherwise, if your ex should die, remarry or leave the company, it may be tough to receive any retirement money.

Adding to the confusion, IRAs don't require QDROs. If you write it in your divorce agreement, you can split an IRA by transferring the funds directly into other IRAs without being subject to penalties or taxes.

If you're paying alimony, you can claim the payments as a deduction. But if you receive alimony payments, they count as taxable income. Child-support payments are neither deductible nor taxable.

Other tips: Take out a term life-insurance policy on the alimony-paying spouse. And update wills, trusts and beneficiary designations on retirement plans and insurance policies, so that your ex doesn't end up inheriting an unintended windfall.

An easy way to avoid making bad financial decisions incident to the divorce is to consult with a certified divorce financial planner. I have found, in some cases, a certified divorce financial planners assistance to be invaluable.

After analyzing the client’s finances, cash flow, work and income history, this professional can run “what-if" and tax impacted scenarios on settlement proposals. In this way, a settlement can be specifically structured to the client’s present and future after tax financial needs.

What Are the Grounds for Divorce in New York

Posted by Daniel Clement on June 13, 2007

I have written a lot on this blog, about the fact that New York does not have a “No Fault” grounds for divorce. What that means is that in New York, in order to obtain a divorce, a party has to allege and prove grounds in order to obtain a divorce.

So, what are the grounds for divorce in New York  Domestic Relations Law §170 sets forth the six grounds for divorce. Of the six grounds, four are fault based. This means meaning that one of the spouses has done something wrong. The four fault based grounds for divorce are:

  1. The cruel and inhuman treatment of the plaintiff by the defendant such that the conduct of the defendant so endangers the physical or mental well being of the plaintiff as renders it unsafe or improper for the plaintiff to cohabit with the defendant.
  2. The abandonment of the plaintiff by the defendant for a period of one or more years.
  3. The confinement of the defendant in prison for a period of three or more consecutive years after the marriage of plaintiff and defendant.
  4. The commission of an act of adultery.

Perhaps the most common fault based ground for divorce is “constructive abandonment.” A constructive abandonment occurs when one spouse refuses to have sexual relations with the other, without excuse or justification, for a period of one year preceding the filing of the action for divorce.

The two non-fault grounds are based upon a separation of, at least, one year, pursuant to a judgment of separation or written separation agreement. It is important to note that a separation in the absence of a judgment or an agreement executed with the required formalities will not be a basis for a divorce.

What Effect does a Bankruptcy Filing Have on Child Support?

Posted by Daniel Clement on June 13, 2007

A bankruptcy filing does not discharge an obligation to pay child support.   To the contrary, since other debts are discharged, funds that might have been paid toward other debts can be freed up to pay child support.

The Child Support Blog cites the recent case of  former NFL wide receiver André Rison to illustrate this point.  A bankruptcy court  ordered Rison into involuntary bankruptcy so that  $105,000 in child support arrears can be paid.

While some unsecured debts can be wiped out or reduced in a bankruptcy, other obligations, like child support, are "nondischargeable." This means that the bankruptcy filing does not wipe them out or reduce them. These debts must be paid regardless of the bankruptcy.

In fact, the 2005 revisions to the Bankruptcy Code made “domestic  support obligations” like alimony and child support a top priority. In order to obtain a discharge under Chapter 13, the debtor must provide for full payment of priority debts, including arrearages in domestic support obligations and certify that all post-petition domestic support obligations have been met.

Children of Divorce Prescribed Ritalin Twice as Often

Posted by Daniel Clement on June 07, 2007

A new study appearing in the Canadian Medical Association Journal reports that children are twice as likely to be prescribed Ritalin after their parents divorce.

According to Mind Hacks, Ritalin is the trade name for the amphetamine-like drug methylphenidate. It is typically prescribed for ADHD, a diagnosis which describes problems with staying focused, impulsiveness and / or hyperactivity.

The full study can be read here.

As questioned in the Earthquake in Zipland blog,  “Is it possible that divorce acts as a stressful life event that creates adjustment problems for children, which might increase acting out behavior, leading to a prescription for Ritalin?”

Could another reason be that children of divorce are more likely to be studied and observed more than children from intact families? Children of divorce are routinely given the opportunity to work out their issues with mental health professionals. For this reason, I am certain that the percentage of children in therapy is highest among children from broken homes.  Could this then account for the greater number of diagnoses and prescriptions?

Wife Granted $184,000,000 in Equitable Distribution

Posted by Daniel Clement on June 06, 2007

A wife was granted $184 million as equitable distribution after trial in a Chicago divorce action. This equitable distribution award is reported to be the largest in history.  

Charles Meyer reports in the Pennsylvania Law Blog that  “this is a rags to riches story, as the parties came to the United States from Eastern Europe with only $500.  Husband became a huge success in the energy business, and later sold his business for several hundred million dollars.

At issue in the case was the wife’s contribution to the wealth. 

David Sarnacki writes in Domestic Diversions that:

They would walk together after dinners, and Michael would share details of his work, looking for empathy, advice or merely an open ear,” Rosenfeld wrote in court filings. “For many years, their marital partnership flourished. Michael provided sustenance and security, and Maya provided love, support, advice and counsel

While the numbers  may seem obscene, the result seems just.   The reported facts reveal that the marriage was a true economic partnership. All of the wealth was created during the long term marriage through the joint efforts of the couple. It seems only fair that the marital property be divided equally.   Quite frankly, even if the division of marital assets should not have been equal, would a 60-40 split  of  the nearly $400 million marital estate really made that much of a difference to these parties?          

It is, disappointing that this couple did not follow the lead of Blixseths, who divided their fortune amicably over a bottle of wine.