Divorce Law Journal

No To Be Published Ky COA Family Law Opinions This Week

We are up-to-date in posting all Kentucky published family law opinions.

No Ky S.Ct. To Be Published Family Law Opinions This Month; Review Granted In One

The Kentucky Supreme Court accepted discretionary review of one unpublished family law case, Noe v. Artrip. The issues are whether a thrift saving plan withdrawal is income for child support calculation and whether a non-custodial, non-disabled parent is entitled to a credit toward his/her child support based on the child's receipt of social security benefit paid on account of the other parent's disability.

Money v. Money, Ky COA, Modification of Marital Settlement Agreements

Money v. Money, ____S.W.3d____ (Ky. App. 2009)

 

Ex-Husband appealed from TC’s order assigning him additional marital debt subsequent to a marital settlement agreement (“MSA”), arguing that MSA was ambiguous and that TC erred by assigning him additional debt, which he alleged was unknown at the time of MSA. On cross-appeal, Ex-Wife argued that MSA was unconscionable.

 

FACTS:

After parties attended mediation with counsel, MSA was entered and incorporated into the decree of dissolution.  MSA provided that Ex-Wife would receive several investment accounts worth over $100K but would assume indebtedness on real estate and balances owed on two credit cards; Ex-Husband was to pay “all other indebtedness.”  It was later determined that there existed a margin loan account with a negative cash balance of $58,469.52, and this

debt was not reflected in MSA. This margin loan account was placed in Ex-Wife’s name as she received the asset securing the debt.  Ex-Wife filed three motions: (1) to transfer the margin

loan account to Gary’s name; (2) to find MSA unconscionable; and (3) to alter, amend, or vacate the judgment. TC granted the motion to transfer the margin loan account. It denied the other two motions, specifically finding the motion to alter, amend or vacate untimely.

 

ANALYSIS:

Ex-Husband argued that MSA is ambiguous regarding the assignment of the margin loan account and must be interpreted against Ex-Wife because her counsel drafted it.

CA found provision that Ex-Husband was to pay “all other indebtedness” unambiguous and that Ex-Husband must pay it per terms of MSA.

 

Ex-Husband next contended that, per CR 59.02 and 59.05, Ex-Wife’s motion to assign the margin loan account to him was untimely because it occurred more than 10 days after the decree of dissolution was entered. CA disagreed, finding that motion was filed to request enforcement of the terms of the agreement as written and therefore there was no time limit on TC’s jurisdiction to do so. On cross-appeal, Ex-Wife argued that MSA was unconscionable because the proportion of the property division is manifestly unfair.  While noting that

An MSA initially approved by TC may be later modified if the party challenging MSA can demonstrate that it has become unconscionable because of changed circumstances, CA found that Ex-Wife did not allege a change of circumstances that rendered the agreement unconscionable and that a mere discrepancy in the amounts received by each party under a settlement agreement is not enough to render the agreement unconscionable. TC affirmed.

 

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

Snodgrass v. Snodgrass, Ky COA, CR60.02(f), Military Retired Pay

Snodgrass v. Snodgrass, __ S.W.3d __ (Ky. App. 2009)

 

 In divorce proceedings, the parties agreed on all issues, except for the division of husband’s military retirement.  Husband served in the military for approximately 4 years prior to the parties’ approximate 14 year marriage.  A hearing was held before a Domestic Relations Commissioner on the division of retirement benefits; however, there is no proof in the record that husband actually received notice of it, waived his right to participate in it, waived his right to have the hearing recorded, or waived any other right or protection on account of his military service.  Husband was deployed overseas during the proceedings and unrepresented by counsel.  The trial court adopted the DRC’s recommendations and awarded the wife 46% of husband’s retirement.  No further activity took place on this matter for over six years.  Eight months prior to husband’s retirement, the wife submitted a form to DFAS requesting 46% of husband’s disposable retired pay, with no distinction between marital and nonmarital portions.  This translated to wife receiving 82% of the marital portion of the benefit and husband receiving 18%.  It was not until his retirement that husband realized something was wrong.  He hired counsel and filed a motion for relief pursuant to CR 60.02(f).  Due to several procedural and substantive delays, husband’s motion was not heard for another year and a half.  The trial court denied his motion, except it did prohibit the wife from receiving any portion of the benefit attributable to husband’s post-divorce increases in rank and pay.  Husband appealed.

    There are three factors that must be met in order to obtain relief under CR 60.02(f):  1) none of the provisions of CR 60.02 (a)-(e) apply, 2) whether the moving party had a fair opportunity to present his claim at the trial on the merits, and 3) whether the granting of relief would be inequitable to other parties.  COA found all three factors weighed in husband’s favor: 1) No evidence supports the applicability of CR 60.02 (a)-(e), 2) Husband lacked the opportunity to be present at the hearing, and 3) Granting relief would not be inequitable to wife because the court had already held that she is only entitled to a share of the marital portion of the retirement benefit and husband did not seek more than that.

    The decree that originally awarded wife 46% of the retirement benefits contained no distinction between marital and nonmarital property.  Therefore, the decree conflicted with the court’s order denying CR 60.02 (f) relief, which states that wife is only entitled to a share of the marital portion of the benefits, and must be corrected.  The decree is also problematic since it did not explicitly first assign each spouse their nonmarital property before dividing the marital property.  As a result, it is unclear what the decree intended the outcome to be for the division of military retirement benefits.  The COA came up with four different possibilities, and narrowed it down to two using logic and the law: 1) the trial court intended to award wife 46% of the marital portion and 0% of the nonmarital portion, or 2) the trial court intended to award wife 46% of the benefit earned up to the point of divorce, but not what husband earned after the divorce.  The COA remanded for the trial court to determine how the decree should be corrected and/or clarified.  The COA referred the trial court to DFAS’s pamphlet entitled Uniformed Services Former Spouses’ Protection Act, Dividing Military Retired Pay for guidance and recommended language.  When dealing with the division of military retired pay of an as-yet-ineligible service member, COA found the language in section IV.c. of the pamphlet regarding “hypothetical awards” to be consistent with Kentucky law. 

Next, COA noted that although husband chose to proceed unrepresented by counsel, he was still protected by the Soldiers’ and Sailors’ Civil Relief Act of 1940.  Thus, even when a service member does not ask for a stay in the proceedings, the Act requires that the trial court determine that the military service of the party would not have a material, adverse effect upon his rights before going forward.                    

Finally, COA did not find error in the fact that husband had not appealed the decree or that he waited years to file a CR 60.02 motion.  The decree on its face seemed to accomplish what husband wanted and he only realized the error shortly before he retired.  Husband promptly acted upon finding the error. 

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Two Published Ky COA Family Law Opinions Today

Money v. Money. Investment account had margin debt but agreement allocated account to wife and provided that husband pay all debt except mortgage and two credit cards. In enforcing agreement court assigned margin debt to husband and was affirmed.

Snodgrass v. Snodgrass. Trial court's denial of  CR60.02(f) relief to restore nonmarital portion of military retirement pay was reversed.

Digests to follow. 

 

Crowder V. Rearden, Ky COA, Civil Contempt

Crowder v. Rearden, __ S.W.3d __ (Ky. App. 2009)

    This is a companion appeal to Rearden v. Rearden, No. 2006-CA-002362-MR. 

   

Kimberly Joy Crowder, formerly Rearden, appealed from two orders, in which the trial court found her in contempt for failure to cooperate with the sale of the marital residence and for failure to pay her portion of the mortgage.  The trial court sentenced her to thirty days in jail.  She only served five days with work release and the remainder of the time was probated for two years.  Crowder also appealed the denial of her motion to alter, amend or vacate the contempt orders.  On appeal Crowder argued that 1) the court jailed her solely for nonpayment of the mortgage without determining her ability to pay, 2) her failure to comply with court orders was not the result of disrespect, but rather impossibility, and 3) the court did not require the husband to mitigate his damages. 

    COA affirmed, finding that the trial court was more than patient with Crowder and did not abuse its discretion in finding her in contempt for failing to obey multiple orders.  Crowder was found in contempt for failure to comply with a myriad of court orders, not just nonpayment of the mortgage.  The original order requiring her to pay the mortgage was based on a review of her finances as submitted in the mandatory case disclosure.  Crowder never challenged that order and allowed it to become final.  She also made three full mortgage payments on the residence.  Thus, the record shows she had the ability to pay.

The Court found Crowder’s mitigation of damages argument ironic at best.  She claims that the husband should have paid the mortgage to avoid having the house fall into foreclosure and damage his credit rating.  She made the argument while offering no proof that the husband could access enough funds to pay the full mortgage himself, the same thing she criticized the trial court for doing when holding her in contempt.  Crowder also failed to cite any case law that demonstrates a party is required to mitigate damages so a former spouse could avoid being held in contempt.

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Ky COA, Jail Sentence For Civil Contempt

 Crowder v. Rearden, decided last Friday, is still not on the minutes. We mention this because the link provided is to a scanned copy which will not automatically be updated. The Westlaw cite is 2009WL3231360.  Digest to follow.

Rearden v. Rearden, Ky COA, Classification Of Property, Attorney Fees

Rearden v. Rearden, __ S.W.3d __ (Ky. App. 2009)

 

The parties divorced after approximately 6 months of marriage.  No children were born during the marriage.  Thus, the primary issues at trial and on appeal concerned the classification of assets as marital or non-marital property:

 

Down payment on marital residence:  The trial court classified the husband’s pre-wedding down payment of $3000.00 from his personal money market account on the marital residence as marital.  Following the Source of Funds Rule, the COA found that the down payment was an identifiable portion of the purchase price and it was made by the husband prior to the wedding.  However, the husband could not trace the $526.87 refund received from the down payment during the marriage as a result of calculations in the closing documents.  COA held that $526.87 refund was marital property and that the remaining $2473.13 was husband’s non-marital property.

 

The treadmill, dining room suite, and bed/mattress:  The trial court classified these items as marital property since the husband could not sufficiently prove they were purchased with his non-marital funds.  COA agreed. Husband purchased the items with his personal credit card, but paid some of the credit card transactions using funds from the parties’ joint account.  The fact that the wife did not challenge husband’s testimony that he used non-marital funds to buy the items does not equate to an admission by the wife.  Husband still had to meet his burden of proof. 

 

Husband’s military retirement benefits:  The trial court found that since the parties were married for 2 months of husband’s 270 months of service credit, wife was entitled to $8.08 per month for the remainder of husband’s life.  Instead of requiring the husband to make such a small monthly payment to the wife, the court ordered husband to pay the wife a lump sum of $3000.  The court did not give an explanation of how it arrived at the lump sum amount.  COA agreed that the wife would be entitled to $8.08 per month for the rest of the husband’s life and that the trial court had discretion to convert the payments to a lump sum.  COA reversed and remanded for an explanation of how the court arrived at $3000.00 as a fair calculation of the wife’s future interest. 

 

The final issue on appeal concerned whether the trial court erred in not awarding the husband attorney fees after finding the wife to be in contempt of court more than once.  COA affirmed, finding that the trial court is not authorized to consider any other factors beyond the financial positions of the parties when awarding attorney fees.  COA also noted that the husband was awarded attorney fees in the companion appeal, specifically addressing the finding of contempt. 

 

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Today's Ky Court of Appeals Published Family Law Opinions

Rearden v. Rearden,  concerning classification of marital/nonmarital property and award of fees in dissolution. A digest will follow. The case mentions a companion contempt appeal considered simultaniously, Crowder v. Readen, but we don't see that one posted in the minutes. We will follow up.

Daunhauer v. Daunhauer, Ky COA, Modification of Maintenance

DAUNHAUER v. DAUNHAUER, ___S.W.3d___ (Ky. App. 2009)

PUBLISHED: REVERSING
ACREE PRESIDING; NICKELL AND SENIOR JUDGE KNOPF CONCUR
COUNTY:JEFFERSON

Ex-Ex-Husband appealed from TC’s order denying his motion to terminate his maintenance obligation, arguing that Ex-Wife was no longer dependent upon that maintenance to meet her needs. 

FACTS:

Ex-Husband and Ex-Wife were married for 21 years.  At time of divorce, Ex-Husband was 48 and working as a dentist, earning $22,000 per year, and Ex-Wife was 42 and working as a secretary, earning $10,000 per year.  Ex-Wife relocated to California before Decree entered.  Parties entered agreement in which Ex-Husband would pay Ex-Wife maintenance of $400 per month, with such amount being modifiable after two years.  TC reduced maintenance to $200 per month after three years, when Ex-Wife’s income as a medical assistant was $26,000 per year and Ex-Husband’s income as a dentist was $36,000 per year.  Five years after that, TC denied Ex-Husband’s next motion for maintenance reduction, finding insufficient change in circumstances.  In 2006, at age 66, Ex-Husband injured himself and needed surgery and physical therapy, so he decided to sell his dental practice and retire.  He filed a motion to terminate maintenance, and although TC found retirement reasonable, TC denied motion as it found parties’ circumstances had not sufficiently changed.  Ex-Husband appealed.

ANALYSIS:

CA held that goal of maintenance award per KRS 403.200 is to facilitate one’s transition from dependence on a former spouse to independence.  CA held that original maintenance award was rehabilitative, and that the most appropriate reason for modification is Ex-Wife’s ability to live independently of maintenance.  Although it is appropriate in some cases to have maintenance not terminate, that occurs only when the claimant’s prospects of self-sufficiency are dismal.  The policy underlying KRS 403.250, requiring a substantial change of circumstances for modification, is relative stability.  CA found these two policies are not at odds.  Because Ex-Husband’s voluntary retirement was reasonable, TC could consider his resulting change of circumstances.  Ex-Wife earned more income than Ex-Husband at time of hearing.  Both parties had expenses in excess of their income.  CA held that if Ex-Wife achieved self-sufficiency, then post-decree increases in Ex-Husband’s income or assets are irrelevant.  Self-sufficiency is determined with reference to standard of living acquired during marriage, not post-decree.  CA also found that TC erred by considering the “relatively small” amount of maintenance and the higher cost of living in California.  If a claimant has achieved self-sufficiency, any amount of maintenance is inappropriate.  Further, since Ex-Wife has sufficient income to meet her needs, the higher cost of living is irrelevant.  CA reversed and remanded. 

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

Mauldin v. Bearden, Ky. S. Ct., Child Custody, CR 60, Continuing Jurisdiction

Mauldin v. Bearden, ___S.W. 3d___ (Ky. 2009)

PUBLISHED: REVERSING
OPINION BY JUSTICE NOBLE; ABRAMSON, CUNNINGHAM, SCHRODER, AND VENTERS, JJ., CONCUR; MINTON, C.J., CONCURS IN RESULT ONLY
COUNTY:

JEFFERSON

Paternal Grandparents appealed from CA decision reversing Jefferson Family Court’s (FC’s) order denying Mom’s motion to set aside FC's judgment awarding permanent custody of Daughter to Paternal Grandparents and her motion for visitation, where FC found that it lacked jurisdiction to consider visitation. 

FACTS: 

At time of Daughter’s birth, Mom and Dad were alcoholics and physically abusive to each other.  Mom had been drunk more than once during her pregnancy and while breastfeeding.  She had also been arrested for PI and DUI during her pregnancy.  Paternal Grandparents filed a petition for temporary and permanent custody and an ex parte emergency motion for temporary custody of Daughter four days after birth of Daughter.  Maternal Grandparents supported the motion, providing an Affidavit regarding both Mom’s and Dad’s unfitness to parent.  FC entered temporary custody order that day and referred the matter to CFC for investigation.    Daughter was immediately taken to Alabama to live with Paternal Grandparents.  CFC subsequently filed DNA action a few days later, which was transferred to same division as custody action consistent with principle of “one family, one judge,” which underlies Family Court, though the actions had and continued to have separate case names and numbers.  The following day, a hearing was held in which both Mom and Dad appeared drunk and were taken into custody. FC reaffirmed its award of temporary custody to Paternal Grandparents.  At a subsequent hearing, Mom and Dad were ordered to participate in a course of rehabilitative treatment and testing and were allowed supervised visitation, though neither ever exercised that right.  Neither Mom nor Dad filed a responsive pleading during this time.

Paternal Grandparents filed a motion asking the court to enter a default judgment granting them permanent custody of Daughter. Neither Mom nor Dad appeared at the hearing or filed   a response. FC entered a default judgment granting Paternal Grandparents permanent custody.  The supervised visitation order from the DNA proceeding remained in effect, but as CFC was taking no further action, there was no termination of parental rights that would have prevented the ordered visitation.  Mom and Dad were still living together.  Paternal Grandparents then initiated proceedings in Alabama, then the home state of Daughter, to formally adopt Daughter. Daughter had then been living there for nearly a year. Alabama entered temporary decree granting custody to Paternal Grandparents and set a dispositional hearing.  Mom participated in the Alabama proceeding through counsel.  She then filed a motion with Jefferson Family Court (FC) under case numbers for both custody and DNA actions, but noticed only for DNA docket, asking for custody of Daughter.  FC denied her motion as improper on DNA docket.

Mom then filed a motion to set aside the default judgment entered against her and to set a custody hearing, pursuant to CR 60.02(d) and (f). In support of her motion, Mom did not provide a Memorandum but filed affidavits signed by herself, Dad and Maternal Grandparents. Mom's affidavit stated that she believed Dad and Paternal Grandparents had conspired with Dad to prevent her participation; that Dad’s threats of abuse and her lack of access to vehicle or phone prevented her from participating in the permanent custody hearing; and that she otherwise would have defended herself, though she did not provide the basis for her defense.  Dad corroborated the abuse and conspiracy.  Maternal Grandparents stated that Mom was now capable of having custody of Daughter.   

After reviewing rebuttal affidavits and hearing the arguments of counsel, FC denied Mom an evidentiary hearing on the merits of her motion and issued an order finding that Mom failed to allege fraud or other improper conduct by Paternal Grandparents or collusion occurring between Dad and Paternal Grandparents and that Paternal Grandparents had done nothing wrong in their pursuit of custody of Daughter. FC noted that Mom and Dad stipulated in DNA proceeding that Daughter was at risk of neglect due to their alcohol abuse.  FC agreed that it had jurisdiction, but that that there was no basis pursuant to CR 60.02 to set aside the judgment granting permanent custody to Paternal Grandparents. 

Mom filed a motion for visitation and a motion to alter, amend or vacate its order denying her relief under CR 60.02.  FC denied Mom's motion to alter, amend or vacate, declining to exercise jurisdiction and deferring the visitation issue to Alabama as the home state of the child.  Mom appealed.  CA reversed, vacated and remanded, holding that affidavits submitted by Mom alleged facts that, if true, demonstrated fraud justifying vacation of the judgment, and that FC should hold a full evidentiary hearing with testimony.  CA also found that Kentuckyhad continuing jurisdiction under KRS 403.824, but did not address the fact that FC expressly declined jurisdiction. 

Questions:

Did FC properly deny Mom’s CR 60.02 motion without conducting full evidentiary hearing on fraud allegations?

Does FC have continuing exclusive jurisdiction such that it must make decisions regarding visitation? 

Analysis:

CR 60.02:

SC found that given what FC judge had from affidavits, record, and what he knew from case, he had sufficient information to determine facts and judge credibility of parties without taking further testimony.  FC was well within its discretion to take allegations on their face, and determine if further proof was necessary, as specificity of fraud allegations would be fleshed out by further testimony but not fundamentally changed.  FC judge had already had numerous contacts with parties to judge credibility of the affidavits.  Also, as a policy matter, FC’s decision spared family further turmoil from redundant testimony.

SC further found that Mom did not have nor did she allege defense at time of default judgment, as required by CR 60.02, and that although abuse and addiction are factors that are proper for a court to consider, neither standing alone equate to “facts of an extraordinary nature” required to be present under CR 60.02.  

Continuing Jurisdiction:

SC found that FC did have jurisdiction over actions concerning Daughter because she was born in Kentucky

and had resided here the entire eight days of her life when action was filed. 

SC nonetheless noted several procedural errors.  Paternal Grandparents filed Petition for custody under KRS 403.828, 403.270, and 405.020.  However, none of those statutes were applicable to Paternal Grandparents at that time. KRS 403.270 and KRS 405.020 applied to parents and/or de facto custodians and, since Paternal Grandparents had not had physical custody of nor provided financial support for Daughter for previous 6 months, they were not de facto custodians.  KRS 403.828 grants emergency jurisdiction to Kentucky when a child is brought in from another state that has jurisdiction over the child but is not exercising it.  As Daughter was resident of Kentucky at the time, this statute did not apply. 

SC noted that Paternal Grandparents could have filed a DNA petition under KRS 620.070 and FC could have issued emergency custody order to Paternal Grandparents under KRS 620.060, but that this order would only have been effective for 72 hours and that temporary removal hearing with full notice to both parents would have had to be held during that time.  That did not occur in this case.  Only when FC “renewed” its temporary custody order and ordered supervised visitation for Mom and Dad in the DNA docket did Paternal Grandparents have full legal custody.  FC should not have refused to hear Mom’s motion to modify custody orders just because Mom filed in the DNA action rather than the KRS 403 action.  SC opined that “it makes little sense… to continue to treat this subject matter as separate actions, if the purpose of the family court system is ‘one family, one judge,’” and that, “one a legitimate party properly invokes the court’s jurisdiction…continued compartmentalization of the proceedings—before the same judge—works only to disadvantage some litigants without a sound reason for doing so.”  SC nonetheless found that these problems did not affect the ultimate outcome, for when Kentucky declined to exercise jurisdiction and deferred to Alabama, proper UCCJEA provisions were followed regarding custody and visitation.  Moreover, UCCJEA does not apply to adoption proceedings and FC could make no ruling affecting Alabama

adoption proceeding.

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

Goldstein v. Feeley, Ky. S. Ct., Jurisdiction, Writs of Prohibition and Mandamus

Goldstein v. Feeley, __ S.W.3d __ (Ky. 2009)

A limited Decree of Dissolution was entered in 2003, dissolving the marriage of Ruby JoAnn Young-Layer and Robert James Layer and reserving the remaining issues, including the division of marital property, for future determination. In 2006, Robert died.  No property issues had been resolved.  Upon the wife’s motion, Robert’s estate was substituted as the real party in interest in the dissolution matter.  In March 2008, on the wife’s motion, the court entered a restraining order to prevent Appellant from transferring any interest in the estate’s assets without court order or agreement of the wife.  Appellant then filed motions to set aside the restraining order and to dismiss the dissolution action for lack of personal jurisdiction.  The court denied his motions.  The wife then asked the court for a temporary injunction in place of the restraining order.  Before the court could hold hearing on the matter, Appellant petitioned the COA for a writ of mandamus and prohibition. The COA denied the petition on the grounds that Appellant had an available remedy through an interlocutory appeal of the injunction.

SC affirmed.  Such writs are authorized in two circumstances: 1) where a court is acting out of its (subject matter) jurisdiction, and 2) where the lower court has jurisdiction but is proceeding erroneously and there is no adequate remedy by appeal. Because the question of personal jurisdiction is reviewable on appeal, writs are unavailable to litigants claiming lack of personal jurisdiction.  Therefore, the COA correctly denied Appellant’s writ.  Regardless of the question of personal jurisdiction, the trial court retained in rem jurisdiction to determine the nature and extent of the marital property and the authority to equitably divide it.      

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Ky Court of Appeals Publishes One Family Law Opinion Today

Daunhauer v. Daunhauer,  COA reversed trial court’s denial of motion to terminate maintenance. Discussion of rehabilitative maintenance. Digest to follow.

Young v. Holmes, Joint Custody, Ky COA Affirmed Order Of Religious School

Young v. Holmes, __ S.W.3d __ (Ky. App. 2009)

           The parties share joint custody of their minor child and could not agree as to where the child should attend kindergarten.  The trial court held a hearing and found that it was in the best interests of the child to attend St. Athanasius School.  Young appealed.  Young argued that the order violates her First Amendment right to religious freedom and that the court could only appropriately order the child to attend St.Athanasius if it found that he had special needs that would require him to attend a private school. 

COA affirmed.  The trial court used the correct standard of best interests of the child and did not base its decision on religious interests.  Young had the burden to prove that “the decision of the trial court was based upon religious interests and such impropriety would not be presumed merely because the school selected had a religious connotation in addition to its academic offerings.”  Therefore, the order did not violate the First Amendment.  Further, the trial court was not required to find that the child had special needs prior to ordering that he attend a private school, since Holmes voluntarily undertook the additional cost of the child’s private education.  Miller v. Miller and Smith v. Smith, cited by Young for that proposition, addressed situations where the trial court had imposed upon a party the additional cost of private education, and thus were not controlling authority in the instant case.    

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

P.C.C. v. C.M.C., Ky COA, Step-parent Adoption, Termination Of Parental Rights,Due Process

P.C.C. v. C.M.C., __ S.W.3d __ (Ky. App. 2009)

           P.C.C. appealed the judgment of adoption which effectively terminated his parental rights and allowed the child’s stepfather to adopt him.  P.C.C. and K.R.C. were married and had a son.  The parties divorced and agreed that K would have sole custody and P would have a set visitation schedule with the child.  K then married C.M.C., who filed a Petition for Adoption and Termination of Parental Rights.  P objected, arguing that C lacked standing to initiate termination proceedings, and he filed a motion to enforce his visitation rights in the divorce matter.  The trial court refused to hear P’s visitation motion unless the adoption petition was ultimately denied.  Pursuant to KRS 199.502, the court granted the adoption petition and terminated P’s parental rights on the theory that P had abandoned the child for more than 90 days by failing to exercise his visitation rights.

            COA reversed and remanded.  P was not afforded fundamental due process throughout the litigation.  C also failed to meet his burden of proof that P abandoned the child.  The evidence indicated that throughout the child’s life his father’s attempts to visit with him had been “systematically thwarted” by the child’s mother.

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Two Ky Court of Appeals Published Opinions Released August 28, 2009

Young v. Holmes

No error nor constitutional violation where trial court determined the child’s best interests would be served by the child attending the father’s choice of parochial school when parents could not agree.

 

Wilder v. Wilder 

After decree entered one party received 2008 federal stimulus check based on parties’ 2007 income. After other party filed CR60 motion, court ordered it to be equally divided and was affirmed.

Digests to follow.

Two Ky Supreme Court Family Law Published Opinions Rendered August 27, 2009

Mauldin v. Bearden

Questions Presented:

Child Custody and Visitation. Issues include whether Kentucky retained jurisdiction over visitation under KRS 403.824, a UCCJEA provision adopted in 2004.

 

Goldstein v. Feeley

Questions Presented: Petition for writ of mandamus and prohibition properly denied where there was an available remedy through an interlocutory appeal of an injunction via CR 65.07. Regardless of the question of in personam jurisdiction over the Executor, trial court retained subject matter jurisdiction over the marital property when one party died after the entry of the decree of marital dissolution but before resolution of the marital property issues.

 

Digests to follow

 

One To Be Published Ky COA Opinion August 21, 2009

C. ( P.C.) v. C. (C.M.) , step-parent adoption reversed where no substantial proof of abandonment by natural father. Digest to follow.

We're Up-To-Date

There have been no Kentucky to be published family law opinions the past few weeks. We are up-to-date.

Lawson v. Lawson, Ky COA, Marital Settlement Agreement, CR 60.02 Corrected)

Oops! Wife received $24 million in the settlement. What's another $20M?

 

 Lawson v. Lawson, ___S.W.3d __ (Ky.App. 2009); 2008-CA-000824-MR

 The parties divorced in 2006.  The wife sought and received an expedited divorce without conducting discovery into the extent of the marital estate.  In the settlement agreement, wife received approximately 4 million dollars of assets and immediately began accepting the benefits of same following the divorce.  Eleven months later, wife filed a CR 60.02 motion challenging the separation agreement based on claims of intimidation, overreaching and/or mental incompetence.  The trial court denied her motion for three reasons:  1) the claims of intimidation, overreaching and/or mental incompetence were unsupported, 2) even if her claims were true, she ratified the agreement by continuing to pursue the benefits of it, and 3) the CR 60.02 motion was not brought within a reasonable amount of time.  Wife appealed.

The COA affirmed.  The trial court did not abuse its discretion in finding that her claims were unsupported or that the motion was not brought within a reasonable time period.  Wife had testified to the trial court that the agreement was fair, the record showed that the parties had negotiated the terms of the agreement, and her attorney had written the wife letters, which wife had signed as well, explaining all the risks of signing an expedited settlement agreement.  The COA did not address whether wife had ratified the agreement by her actions. 

Senior Judge Harris, Concurring opinion:  The majority reached the right result.  However, had the CR 60.02 motion been timely presented, the trial court would have had to grant the wife an evidentiary hearing on her mental capacity claim and then render a specific finding of fact as to her mental capacity at the time she signed the agreement. 

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Stipp v. Charles, Ky COA, Venue, Division Of Marital Property, Amount Of Maintenance

STIPP V. CHARLES

TO BE PUBLISHED:  AFFIRMED

PANEL:  ACREE PRESIDING; NICKELL AND KNOPF CONCUR

COUNTY: JEFFERSON
DATE RENDERED: 7/2/2009

 

Ex-Husband appealed TC’s order finding that he waived his objection to improper venue and dividing marital assets and awarding maintenance, claiming error.   

 

FACTS:

 

The parties separated after 20 years of marriage.  They had one teenage child.  At the time of separation, the parties resided in Oldham County near the Jefferson County line.  The most Ex-Husband earned in one year was about $35,000, while Ex-Wife was earning $235,000 at the time of separation in addition to receiving bonuses, stocks, and stock options.  Ex-Husband did not work and provided primary care for the parties’ son for a period of time. 

 

Ex-Wife filed for divorce in Jefferson County.  Subsequently, she filed a domestic violence petition in Oldham County and an emergency protection order was entered.  Ex-Husband filed his response to the divorce petition in Jefferson County, noting that neither party resided in Jefferson County and that the proper venue was Oldham County; but rather than objecting to the venue, stated that he “reserves the right to ask [the] court to transfer [the] case to the Oldham Circuit Court.”  He then filed his mandatory case disclosure in Jefferson County. 

A case management conference was scheduled by the Jefferson family court and mediation was also scheduled.  Both parties also filed other motions with the Jefferson court, as well as an Agreed Order dismissing the Oldham County domestic violence order.  Only after these filings did Ex-Husband then file a motion requesting a transfer of the case from Jefferson County to Oldham County on grounds of improper venue. The Jefferson family court proceeded with the case management conference, finding the motion for transfer to be untimely and denied it on that basis.  After final hearing, the Jefferson family court awarded Ex-Wife 57% of the marital assets and 43% to Ex-Husband, awarded Ex-Husband maintenance of $2,000 per month for a period of six Years, and required Ex-Wife to continue providing health insurance coverage for Ex-Husband through COBRA for three years, which the court reduced to eighteen months in response to Ex-Wife’s motion to alter, amend or vacate, as this was the period of allowable coverage under Ex-Wife’s health insurance plan.

Ex-Husband then appealed.

 

ANALYSIS:

 

Venue.  At the time the case was filed, Oldham County was the proper venue. 

“Improper venue” is a defense, CR 12.02(c), which a party must assert, either in a responsive pleading or by motion, within 20 days after service

of the summons upon him/her.  If the defense is not so asserted, it is waived.   As Ex-Husband did not timely raise his objection under the Rules, he waived the objection. 

Furthermore, Ex-Husband availed himself of the Jefferson family court’s time and judicial resources by filing documents with the court and entry of Agreed Orders with that court.   Were the court to allow Ex-Husband’s “reservation” as an assertion of the improper venue defense beyond the time allotted by the Civil Rules, the court would enable a form of forum shopping, allowing a party to subjectively assess how the litigation is progressing before seeking a different venue. If Ex-Husband wanted the case transferred to another county after failing to object to improper venue in his responsive pleading, the legal basis of such a post-pleading motion was the doctrine of forum non conveniens. Even if Ex-Husband’s motion were viewed under this doctrine, the Jefferson family court did not err in denial of the motion, as it had already expended judicial resources in the case and the parties’ residence was far from inconvenient.

 

Distribution Of Marital Assets.  Ex-Husband also claims TC erred by failing to distribute the marital assets equally. CA found that, in determining the division, TC followed the statute and considered “all relevant factors,” including those listed in KRS 403.190(1)(a)-(d), and found no error. 

 

Award Of Maintenance.  Ex-Husband also contended TC abused its discretion by awarding him maintenance of only $2,000 per month for six years. He argued the

CA found that TC properly considered the nature of Ex-Wife’s financial resources, the standard of living established by the parties during the marriage, the duration of the marriage, and the ability of Ex-Husband to meet his own reasonable needs, and found no error.      

 

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

 

 

No Ky COA Family Law To Be Published Opinions July 10, 2009

One To Be Published COA Opinion Rendered Today

Stipp v. St. Charles, re venue, division of marital property, maintenance. Digest to follow.

Holland v. Holland, Motion Required Before Child Support May Be Modified

Holland v. Holland, __ S.W.3d __ (Ky. App. 2009), 2008-CA-002115-ME

       At the time the parties divorced in 2007, the father was living in Hardin County, Kentucky and the mother was living in Jefferson County, Kentucky.  The trial court entered an order outlining various contingencies regarding parenting time and child support.  If the father moved to Louisville within ninety days of entry of the court’s order, the parties would share equal parenting time and determine an appropriate child support obligation.  If the parties could not agree on child support within 30 days of his relocation, the father could file a motion for modification of child support.  When the father actually relocated to Louisville, the parties could not agree on child support.  A hearing was scheduled on the matter on December 4, 2007, but the father never filed a written motion for modification.  Following the hearing, the trial court entered an order requiring that the new parenting schedule begin on December 8, 2007.  Then the court entered an order in May 2008 reducing his child support obligation.  The father asked the trial court to make the reduction retroactive to December 8, 2007, the date the new parenting schedule began.  The trial court denied his request since no written motion for modification of child support had been filed.     

The COA affirmed.  No oral or written motion for modification of child support had been filed.  The mother cannot be divested of child support payments that have already been accrued.  Since a court speaks through its written orders, no child support modification occurred until May 2008.  Pursuant to KRS 403.213(1), a written motion for modification is required before a trial court may change a child support award. 

Digested by Sarah Jost  Nielsen, Diana L. Skaggs + Associates

Ky COA Decides Child Support Modification Case Today

Holland v. Holland, digest to follow.

Howard v. Howard, Ky COA, Child Support Modification, Discharge Of Debt In Bankruptcy

HOWARD V. HOWARD

CHILD SUPPORT MODIFICATION; DISCHARGE OF MARITAL DEBT IN BANKRUPTCY
TO BE PUBLISHED:  AFFIRMED

PANEL:  SENIOR JUDGE LAMBERT PRESIDING; CLAYTON AND THOMPSON CONCUR

COUNTY: LAUREL
DATE RENDERED: 6/12/2009

Dad appealed TC’s finding that he was voluntarily underemployed and corollary order denying his motion for modification of child support, as well as TC’s finding that Dad was in contempt for his failure to pay a deficiency judgment related to a marital debt. 

Motion for Modification of Child Support:  While parties’ divorce was pending, Dad quit federal job, claiming medical grounds, but TC found after trial that Dad was voluntarily underemployed and imputed income to him based on his prior earnings.  The following year, Dad filed his Motion for Modification of Child Support, claiming that his income had dropped to less than half that of his former employment.  TC reiterated its previous finding that Dad was voluntarily underemployed and held that he had presented no new evidence since the prior determination.

CA held that Dad failed to make a showing of a substantial and continuing material change in circumstance, as required by statute for child support modification, as the circumstance he presented to the court at the modification hearing was not materially different than that presented to the court at the trial. 

Finding of Contempt regarding failure to pay Debt:  The parties’ divorce decree provided that Dad was to pay a deficiency judgment arising from repossession of an automobile.  Dad subsequently sought bankruptcy protection, listing the automobile debt as an obligation.  At the modification hearing, Dad was held in contempt for failure to pay this debt.  Dad appealed the finding of contempt, claiming discharge in bankruptcy, in part because Mom did not object in bankruptcy court.  Mom argued that Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 precludes bankruptcy discharge of all marital and domestic relations obligations. 

After noting that state courts have concurrent jurisdiction with federal courts over whether a debt has been discharged, CA held that because the automobile debt was agreed to by the parties and imposed on Dad by decree, it was “in connection with a divorce decree” and was therefore non-dischargeable in bankruptcy.  Thus, TC used its power of contempt to enforce its orders, and did so without error. 

TC affirmed.

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

One To Be Published Family Law Opinion Issued By Ky COA June 12, 2009

Howard v. Howard The issues presented here are whether the trial court was clearly erroneous in its determination that Appellant was voluntarily underemployed, thereby justifying the trial court’s refusal to modify its prior child support order; and whether the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, 11 U.S.C. Sections 523(a)(5) and (15), precludes discharge in bankruptcy of Appellant’s obligation to pay for the Dodge Durango automobile as required by the court’s final decree. Digest to follow.

Kessler v. Switzer, Ky COA, No Hearing Required For Extension of DVO

Kessler v. Switzer, __ S.W.3d __ (Ky. App. 2009); 2008-CA-002083-ME

Switzer filed a motion to extend a domestic violence order (DVO) and attached an affidavit stating that she had filed charges against Kessler for violation of the DVO and that she was still in fear of Kessler. When the matter came before the court, Switzer’s counsel informed the court that the charges had been dismissed. Kessler objected to the court ordering the extension without holding a hearing in which Switzer could testify and be cross-examined. He also objected to the extension on the grounds that there was no legal standard for granting such extensions. The trial court granted the extension and this appeal followed.

The COA affirmed. The statute does not require that a hearing be held or that evidence of additional acts of domestic violence be presented in order for the court to grant an extension of a DVO. The trial court properly considered the facts and circumstances of the case. COA also found that Kessler waived his constitutional claims since he failed to follow the proper procedure pursuant to KRS 418.075.

Judge Caperton’s dissent: The trial court should not have accepted the allegations made in Switzer’s affidavit without the test of cross-examination.

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Gaskill v. Robbins Now Final

Here is the final opinion, which was not modified.

Discretionary Review Granted In Lichtenstein v. Barbanel

The Kentucky Supreme Court granted discretionary review in Lichenstein v. Barbanel, a child support enforcement case. The Court of Appeals opinion was designated not to be published. We will digest that opinion soon.

Nelson v. Nelson, Ky COA, Support For Adult Dependant Child

Nelson v. Nelson, _ S.W.3d _ (Ky. App. 2009); 2008-CA-001861-ME

The parties divorced in 2004. Their property settlement agreement provided that the mother would not request financial assistance from the father for their adult dependent daughter for a period of two years. After two years, the father would provide financial assistance, not to exceed $150 per month, if necessary. In 2008, the mother requested that the father contribute to their daughter’s support. The daughter was only able to work six to nine hours per week at Ponderosa due to multiple disabilities, but did not qualify for disability benefits. Her reasonable expenses were found to exceed $740 per month. The family court ordered the father to contribute $729 per month towards the daughter’s support pursuant to KRS 405.020(2). Father appealed.
The COA affirmed. Although the agreement stated that the father’s contribution would not exceed $150 per month, the daughter’s need for support changed when she was denied disability benefits. Pursuant to KRS 405.020(2), both parents share a joint obligation to support children who are wholly dependent because of a permanent physical or mental disability. Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Ky COA Publishes One Family Law Decision Yesterday

Nelson v. Nelson, support of adult child. Digest to follow

Conn v. Ingram, Ky COA, Adult Adoption, Residency

CONN v. INGRAM ADOPTION RESIDENCY REQUIREMENTS 2007-CA-002255 PUBLISHED: AFFIRMED PANEL: NICKELL PRESIDING; CAPERTON AND KELLER CONCUR COUNTY: MENIFEE DATE RENDERED: 4/24/2009

Dad appealed from TC order dismissing his petition to adopt his adult natural born Daughter because he failed to satisfy the residency requirement stated in KRS 199.470(1). Dad claimed that the statute’s residency requirement applied to Daughter, not to him.

Dad’s petition for adoption stated that he was a resident of Missouri and Daughter a resident of Kentucky. An adult may be adopted in Kentucky under the same laws for adoption of a child, with the exception that only the adult’s consent is needed. Kentucky’s adoption law provides that the person filing the petition must be a resident of Kentucky for one year prior to filing the adoption petition. Dad argued that this residency requirement is relevant only to the adoption of minors. CA disagreed, holding that the residency requirement stated in KRS 199.470(1) applies to all adoptions and recognizing that the Kentucky Supreme Court had previously stated that the residency requirement of the adoption statute must be strictly enforced.

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

One Ky Court of Appeals To Be Published Family Law Opinion Today

Conn v. Ingram, affirmed order dismissing petition to adopt adult because petitioner failed to meet residency requirement of KRS 199.470(1). A digest will follow.

Ky Supreme Court Minutes Yesterday

No family law to be published opinions were released, but discretionary review was granted in Commonwealth, Cabinet for Health and Family Services, v. L.J.P., et al. A digest of the court of appeals opinion and link to the decision is here. Briefing will be expedited and oral arguments will be held August 12, 2009 at 11 a.m.

J.G. v. J.C., Ky COA, Defacto Custodian

J.G. v. J. C. , _ S.W.3d _ (Ky. App. 2009), 2008-CA-1023

Parents appeal the judgment holding that the grandparents are the de facto custodians of S.G. The parents have three other children, all of whom had been previously removed. Due to previous issues, social services placed S.G. with the grandparents three days after she was born. A couple of weeks later the parents filed a motion to terminate the temporary custody order and have S.G. returned to their care. The trial court denied the motion. The parents then participated with social services to try to regain custody of S.G. After about eleven months, the grandparents filed a petition for declaration of de facto custodian and permanent custody. After numerous hearings, the DRC recommended that the grandparents be deemed the de facto custodians of the child and be awarded permanent custody. The trial court adopted the DRC recommendations. The parents filed exceptions to the findings, a motion to alter the court’s decision, and a motion for further findings of fact. The trial court denied the motions and this appeal followed.

COA found that the grandparents did not meet the statutory requirements for being declared the child’s de facto custodians. COA reversed and remanded, ordering the trial court to make further findings of fact. First, the trial court must determine whether the grandparents met the one year time requirement pursuant to KRS 403.270, especially in light of the tolling requirement of KRS 403.270(1)(a). The time between when the parents filed their motion to terminate the temporary custody order and when the court ruled on that motion does not count toward the de facto custodian time requirement. Next, the trial court must make the findings requested by the parents in a previous motion. Finally, the COA noted that a married couple is considered a single unit for the purpose of de facto custodianship, and therefore a couple may be deemed de facto custodians as opposed to a single individual.

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Kentucky Supreme Court Oral Family Law Arguments Scheduled

Discretionary review was granted in Mullins v. Picklesimer, (child custody, lesbian partner of biological mother). The Court of Appeals opinion is here and our digest is here. Oral argument will be held April 15, 2009 at 9:00 a.m. Discretionary review was also granted in Mauldin v. Bearden,(child custody, grandparents, UCCJEA) online here and digested here. Oral arguments will be heard April 16, 2009 at 9:00 a.m. Watch them live here.

Hold Your Horses; Gaskill v. Robbins Not Yet Final

The landmark goodwill case in divorce business valuations, Gaskill v. Robbins, rendered February 19, 2009 is not yet final. A petition for rehearing is pending.

No Ky. S. Ct. Published Family Law Decisions This Month

No To Be Published Ky COA Family Law Decisions Issued Today

Gaskill V. Robbins, Goodwill In Business Value, 50/50 Property Division

GASKILL V. ROBBINS DIVISION OF MARITAL PROPERTY, GOODWILL 2007-SC-000190-DGE PUBLISHED: AFFIRMED PANEL: NOBLE PRESIDING; CUNNINGHAM, SCHRODER, VENTERS AND SCOTT CONCUR; ABRAMSON CONCURS IN PART AND DISSENTS IN PART COUNTY: WARREN DATE RENDERED: 2/13/2009

SC considered whether the goodwill of a closely held or sole proprietorship business can have both personal and enterprise values, and whether TC improperly assumed that it must make a 50-50 division of the marital assets.

FACTS: During the marriage, Wife worked as owner and sole practitioner of an oral and maxillofacial surgery practice, while Husband worked as a salaried employee with several businesses. At the time of trial, the parties had amassed a marital estate of over $4 million, including the value of the practice at about $670,000. Wife earned about 90% of the income during the marriage, and testimony indicated that she was very hard-working and responsible both for management of the office and patient acquisition, although Husband did provide minor assistance with the business. At trial, Wife’s expert testified that, on an asset-based analysis, the practice was worth about $221,000, which included a value of $0 for goodwill of the business because Wife’s role in the business amounted to a “non-marketable controlling interest.” Husband’s expert used the average of the values derived from four different methodologies, assuming the existence of Wife’s non-compete agreement and goodwill, and arrived at a value of $670,000. TC accepted Husband’s expert’s valuation, relying on the premise that there was no authority for the distinction between personal and enterprise goodwill in Kentucky law. CA reversed on TC’s goodwill ruling because it believed TC was under incorrect impression that goodwill must be assigned a value greater than $0, and it recognized that not all businesses have goodwill. TC determined that marital property should be divided 50-50, relying on the parties’ equal contribution to the marital estate, including duties at home and raising their child, as well as Wife’s greater ability to rebuild her estate.

ANALYSIS: Valuation of Goodwill: If the reputation of a business will draw customers and get them to return, the business has goodwill. Previous KY cases recognize that everything of value in a business, including transferable goodwill, must be counted. None of those cases recognized a distinction between personal and enterprise goodwill, but they did not prohibit the distinction. Enterprise goodwill is based on the intangible, but generally marketable, existence in a business of established relations with employees, customers, and suppliers. On the other hand, much like professional degrees, personal goodwill is nontransferable, belonging primarily or only to the individual. If the value of a business is to be decided on a fair and reasonable basis, and property divided equitably, this must be considered. SC found that the skill, personality, work ethic, reputation, and relationships developed by Wife are hers alone and cannot be sold to a subsequent practitioner. This personal goodwill is nonmarital property that will continue with her regardless of the presence of any spouse. SC held that to consider this personal goodwill as marital property would effectively attach her future earnings, to which Husband has no claim. Further, if Husband were then awarded maintenance, this would amount to double-dipping and cause a dual inequity to Wife. Lastly, SC recognized that the distinction between enterprise and personal goodwill is as susceptible to expert valuation as goodwill on the whole is.
Valuation Methods: SC held that using an average of values to obtain a value of a business, without some basis other than an inability to choose between conflicting and competing valuation methods, is nothing more than making up a number, for there is no evidentiary basis to support that specific number. The trial court must fix a value, and there should be an evidence-based articulation for why that is the value used. Further, the business must be valued in its existing state, and a non-existing non-compete clause cannot be considered.
Equitable Division of Marital Property: TC recognized that there is no presumption of a 50-50 division without regard to the evidence. However, SC held that because a court must divide the property in “just proportions,” starting the parties off in an even position in order to determine how to apportion is not unreasonable, provided that TC considers all the relevant factors of KRS 403.190. This statute requires consideration of each spouse’s contribution to acquiring the marital estate, and here, Wife clearly contributed more monetarily than Husband did. However, the ability to work with the support of a spouse/co-parent is an intangible that goes beyond dollars. Within the marital arrangement, abilities are often unequal, the use of one’s time varies according to present need, and each spouse does things to accommodate the other. How the parties earn money and build wealth is affected by these variables, but is done for common purpose. Thus, SC held, the term “contribution” has tangible and intangible components that must be weighed by TC. Furthermore, in its division of property, TC should also consider parties’ ability to earn after divorce, and Wife clearly has the advantage here.

CA’s decision re goodwill and TC’s valuation and division of practice affirmed on other grounds, and TC’s 50-50 division of property affirmed. Remanded to TC to determine value of practice and divide marital estate.

DISSENT IN PART BY ABRAMSON: If expert testimony establishes that covenants not to compete are an integral part of a sale of a profession practice, as they typically are, the expert should be able to take them into account in assessing the value of the practice.

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

No To Be Published Ky COA Family Law Opinions Today

R.M. v. R.B., KY COA, Adoption, Termination Of Parental Rights

R.M. v. R.B. , _ S.W.3d _ (Ky. App. 2009); 2008-CA-001099-ME

Trial court denied adoption of A.E.B. by her maternal aunt and uncle, R.M. and R. M., and further denied the involuntary termination of parental rights of the child’s father, R.B. R.M. and R.M. appealed. COA held that adoption is statutory right and that Kentucky Courts require strict compliance with the statutory mandates set out in KRS Chapter 199. Several statutory procedures were not followed by the trial court. First, the petition for adoption contained no allegations against R.B. sufficient to establish grounds for terminating his parental rights. Second, the trial court conducted an adoption hearing without submission of the Cabinet’s required report regarding its investigation of the proposed adoption. There was no record that the Cabinet had even investigated the adoption pursuant to KRS 199.510. Nevertheless, COA affirmed the trial court. Even thought the trial court made its decision based on the wrong reasons, it reached the correct result. COA noted that appellants are not barred from filing another petition that complies with the adoption statutes.

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Herald v. Herald, UCCJEA (Child Custody Jurisdiction)

HERALD V. HERALD CHILD CUSTODY JURISDICTION (UCCJEA) 2008-CA-000601 PUBLISHED: VACATING AND REMANDING PANEL: THOMPSON PRESIDING; STUMBO AND GUIDUGLI CONCUR COUNTY: KENTON DATE RENDERED: 2/13/2009

Dad appealed KY TC’s ruling awarding custody of 3 children to Mom, contending that KY TC lacked jurisdiction to make such an order under UCCJEA.

FACTS: Family lived in NC for several years before parties separated and Wife and children moved to KY in April 2007. Dad, a marine, stayed in NC awaiting deployment. In June 2007, parties entered into a separation agreement giving Dad custody of kids, and kids returned to NC where they stayed until Mom removed them again in October. Mom then filed Petition for Dissolution of Marriage in KY in January 2008. A few weeks later, Dad then removed the kids back to NC, refusing to tell Mom of kids’ location or to allow her to speak with him and informing her that he was soon to be deployed to Iraq.

Mom subsequently filed Motion for custody in KY. TC issued order scheduling status hearing for February 19th. On February 15th, Mom filed and was granted an ex parte motion for emergency custody. Dad’s NC counsel corresponded with KY court on February 18, advising that Dad was deployed, kids had lived in KY only 2 ½ months, and providing copy of his motion for custody filed in NC court on February 15. KY TC nonetheless conducted hearing on February 19. Mom testified, but Dad did not appear. KY TC indicated at end of hearing that it would communicate with NC court re proper jurisdiction under UCCJEA, but this never occurred. KY TC gave Mom custody a week later. Dad entered special appearance a month later to move to dismiss case due to KY TC’s lack of subject matter jurisdiction and in personam jurisdiction over him. KY TC declined to dismiss Mom’s custody petition but did stay action under Soldiers’ and Sailors’ Civil Relief Act.

ANALYSIS: Parties conceded that KY was not home state of children for six months, nor that NC had declined to exercise jurisdiction; therefore, KRS 403.822 did not apply. Mom alleged that KY had jurisdiction under KRS 403.828, the temporary emergency jurisdiction provision of the UCCJEA. This statute allows KY jurisdiction where a child in KY has been abandoned or needs emergency protection to prevent or escape from mistreatment or abuse. CA found no allegations of mistreatment or abuse by Mom in refusal to inform her of location of children. Although Dad was due to be deployed to Iraq, TC cannot use this fact against Dad because those serving in military should not be automatically deprived custody of their kids. Furthermore, to allow such justification for exercise of “emergency” jurisdiction would allow a parent seeking custody to file such a petition in any state moment before deployment.
KY TC’s order vacated and remanded for order dismissing petition for custody.

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

One To Be Published Ky COA Adoption Case Decided Today

A digest of R.M. v. R.B. will follow.

No To Be Published KY COA Family Law Cases Released Today

Unless you consider David V. Johnson, that is. Decedent's step-child who was not legally adopted may not recover share of damages under wrongful death statute.

Ky S. Ct. Decides Buisness Valuation Goodwill Case Today

Kentucky finally joins the majority in distinguishing between personal and enterprise goodwill in business valuations. Court also cannot factor in a non-existent non-compete agreement to enhance a professional practice valuation. It's about time! Gaskill v. Robbins, online here. Digest to follow.

Ky UCCJEA COA Decision February 13, 2009

A digest of Hearld v. Hearld, custody jurisdiction under UCCJEA, will be posted soon

Hines v. Carpenter, Ky COA, Damages From Supersedeas Bond Pending Appeal Of Child Support

Hines v. Carpenter, _ S.W.3d _ (Ky. App. 2009), 2006-CA-002173-MR

The trial court entered a summary judgment in favor of Hines for back child support owed by Carpenter.  Carpenter appealed the judgment and posted a supersedeas bond to stay the collection of the judgment while the appeal was pending.  The Court of Appeals affirmed the summary judgment in favor of Hines.  Then a QDRO was entered by the trial court, requiring that Hines be paid 50% of Carpenter’s monthly benefit until the sum of $149,495.01 was paid in full, or the Appellants die, or Carpenter dies, whichever first occurs. Hines then filed a motion to compel Carpenter to pay a lump sum of $14,175 for damages allegedly incurred by the posting of the supersedeas bond.  The trial court denied the motion to compel.  This appeal followed.  
   The sum of $14,175 is equivalent to the 21 monthly payments that Hines would have received during the pendency of the appeal.  Hines argued the motion to compel should have been granted because interest on the uncollected judgment was accruing at more than twice the rate of the current monthly payments by the pension plan.  She also argued that the full judgment would never be recouped since Carpenter, who was sixty-two years old at the time the motion to compel was filed, would have to live another 18 years for them to receive just the principal amount of the judgment.  
KRS 26A.300(1) prohibits the collection of damages on a first appeal as a matter of right.  Carpenter’s appeal was his first on this issue.  Therefore, the relief Hines requested was statutorily forbidden.  
AFFIRMED

Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

Ruby v. Ruby, Ky COA, Domestic Violence, Recusal,Voluntary Dismissal

Ruby v. Ruby DOMESTIC VIOLENCE HEARINGS AND VOLUNTARY DISMISSAL 2008-CA-000122 PUBLISHED: REVERSING AND REMANDING PANEL: THOMPSON PRESIDING; MOORE CONCURS; HENRY CONCURS IN PART AND DISSENTS IN PART COUNTY: JEFFERSON DATE RENDERED: 1/23/2009

Husband appealed from TC’s entry of DVO, asserting that TC judge should have recused; that it should have granted his request for continuance and his request to obtain Wife’s mental health and prescription records; that his constitutional rights were violated because he was denied assistance of counsel, the right to confront witnesses against him, and to present his own witnesses; and that TC should have vacated DVO pursuant to an agreed order entered by the parties.

FACTS: EPO was issued against Husband after Petition for DVO filed by Wife. DVO hearing was scheduled to occur 11 days later, but Husband requested and was granted over Wife’s objection a continuance and the hearing was rescheduled to occur 15 days later. At the rescheduled hearing, Wife and her attorney appeared but Husband did not. Substitute counsel appeared on Husband’s attorney’s behalf and stated that Husband’s attorney was ill and that court staff informed Husband’s attorney that the hearing was continued. TC learned from staff that they did not inform Husband’s attorney that hearing was continued. TC contacted Husband’s attorney at home and informed him that the hearing would proceed. Substitute counsel moved for TC judge to recuse himself as Husband was an attorney that had practiced in his court. TC judge refused.

Wife testified as to extensive injury inflicted by Husband, and Husband’s substitute counsel was given the opportunity to cross-examine Wife. TC then ordered that it would hear testimony from Husband one week later, but that no other testimony would be heard. At that hearing, Husband testified that argument between Husband and Wife occurred because of Wife’s irrational behavior and that her injuries resulted from her tripping over an open dishwasher door.

One week after Husband’s testimony, TC found that Husband abused Wife and that abuse may occur in future and therefore entered DVO prohibiting contact between parties. Two days later, Husband filed motion to vacate DVO, stating that parties were attempting reconciliation and included Agreed Order in which Husband and Wife requested DVO dismissal. TC denied motion but amended DVO from “no contact” order to “no unlawful contact” order.

Judge Recusal: CA held that recusal is not necessary merely because an attorney has practiced before a judge. Only when a judge would be biased against one party is recusal required.

Continuance of Hearing and Constitutional Issues: KRS 403.740 requires that a DVO hearing be conducted within a limited time. Husband had already been granted one continuance, thus it was not an abuse of discretion for TC to deny second continuance. Regarding Husband’s contention that he was not allowed to present witnesses on his behalf, CA held that TC could have entered its decision based only on evidence presented at initial hearing date, which would not have included Husband’s testimony, and that TC gave Husband more than he was entitled to by granting the additional date for Husband to testify. Regarding his claim that he could not confront witnesses, substitute counsel for Husband did cross-examine Wife though Husband was not present.

Husband also contended that he should have been able to call Witnesses to testify on his behalf and specifically complained that though he subpoenaed Wife’s brother and sister-in-law to appear at the second hearing date, TC judge refused to hold those witnesses in contempt. CA held that language of Kentucky statutes regarding disobedience of a subpoena is permissive and does not require the court to issue contempt citation or warrant to bring witnesses before court. The effect of issuing the citation or warrant would be to grant Husband’s second continuance, and weighing this against the possible relevancy of the testimony in question, TC’s refusal to hold witnesses in contempt was justified. The same reasoning applied to Husband’s complaint that TC should have granted his motion to compel Wife’s medical and psychiatric records; not only was the motion improperly noticed, but granting the motion would have given Husband his second continuance.

Joint Motion to Vacate DVO: Though TC found that domestic violence had occurred and would probably re-occur, parties requested just two days later to have DVO vacated. CA held that while a domestic violence petition is pending, victim can seek dismissal under CR 41. Where DVO has been entered, however, TC has discretion to deny parties’ requests to vacate, after inquiring into the voluntariness of victim’s participation in the request. TC here only asked Wife if she agreed to vacating DVO, to which she responded only “yes.” CA held that TC should have inquired further into circumstances that caused her to enter the agreement and could deny the motion only after making specific findings supporting its denial.

Reversed and remanded.

DISSENT:

TC is in best position to determine whether hearing should be required on Joint Motion to Dismiss. Given that Motion was filed such a short time after DVO entered, there was no abuse of discretion.

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates