Virginia Family Law Appeals

Judd v. Judd: CUSTODY – RELOCATION.

 The husband and father thought that he had a good technical-procedural, or even constitutional, argument against letting his wife, in the initial custody determination in a divorce case, argue her relocation issue (that she wanted to move the children from Warrenton to Wisconsin).  His argument was that since there is a statute requiring 30 days notice of intent to relocate, and there was a pendente lite custody order with the same statutory requirement recited, the wife had no business coming into court and arguing her relocation case.  However, to the trial judge in Culpeper County it seemed a highly artificial way to go about this thing if he made the wife try the initial custody determination case with the relocation elephant standing in the corner and everyone pretending it wasn’t there.  This is indeed what the husband apparently wanted the judge to make her do, and then she couldn’t move until she had given 30 days notice from at least the time of the new final order -- and then she’d be seeking an instant modification.  That just didn’t persuade the trial judge, and it didn’t persuade the Court of Appeals.  The judge explained very simply and clearly why he wanted to take a practical approach for the sake of judicial economy, common sense and everything else.  And since he gave this full explanation, and the judge’s position was rational, and his decision awarding the mother custody and allowing her to move the children out of state, will stand.  The Court of Appeals goes to some rather complex efforts to explain its approval of this procedure, which is a lot more appealing than the Supreme Court’s position in Parrish v. Spaulding was, and some of its reasoning going beyond all that may be regarded by some as questionable, but the result reached would seem in any case to be fairly sound.  Judd v. Judd, 53 Va. App. 578, 673 S.E.2d 913 (3/17/09).

Shanklin v. Commonwealth: CHILD NEGLECT – FELONY – WILLFULNESS.

 Felony child neglect simply has a few more elements than the Commonwealth and the judge below were willing to recognize, the Court of Appeals explained as it reversed the conviction in a case called Shanklin v. Commonwealth, __ Va. App. ___, ___ S.E.2d ___, 23 VLW 1225 (4/7/09).  This woman babysat a four-year-old child a few times, and the evidence was that his foot and his hands incurred second degree burns while the tot was in the care of this woman’s son.  Sitting with the child for a five-hour period on a July day, she did notice that the child was sleepy and lethargic and could not walk, and that the locations of his burns were wrapped up in large amounts of duct tape, but she did not question the son when he came to pick the child up and take him back.  This was all there was in the case, though the trial court made a finding that the amount of duct tape was “massive,” and thus should serve as a sign that there was something terribly wrong.  The Commonwealth’s theory was that it was this woman’s duty to summon immediate medical help but, as the Court of Appeals explains, in these felony cases “the Commonwealth must show more than mere inattention and inadvertence; defendant’s negligence must rise to the standard of gross negligence.”  The evidence here didn’t show that the babysitter recognized how bad the injuries were, nor that she disregarded a need for medical assistance of which she was not aware.  It was clear from the record that she did not know how bad the burns were, and thus had no real reason to make an emergency doctor call, nor even to quiz her son about it.  To show felony child neglect, the prosecutors would have to have shown that she made a willful decision to neglect known immediate medical needs.  The Court of Appeals then went through the child’s behavior for possible red flags that would trigger this woman’s responsibility.  The appellate judges find it significant that the child did not show any signs of discomfort, but simply was lethargic while he played and while he dined.  And while duct tape as bandages may be unorthodox, the opinion by Judge Elder notes, it does work for a minor injury, and defendant not knowing what was under the duct tape she had no reason to tear it off.  In fact she did ask her son when the child was dropped off what had happened to him and the son told her the kid burned himself with hot water.  There was no discussion of how serious the injuries might be and it is obvious that there are numerous reasons a young child might be lethargic. 

Judd v. Judd: PROPERTY DIVISION – PENSION DIVISION – PROPORTIONS.

In the case named Judd v. Judd, 53 Va. App. 578, 673_ S.E.2d 913, 23 VLW 1178 (3/17/09), which is also here under “CUSTODY”,  the Court decided it was justified in dividing the wife’s pension so as to give 100% to her.  This unusual situation concerned a spouse who had made by far the most monetary contributions, and the Court decided, the most non-monetary contribution and had spent most of her time being employed outside the home as well as raising a family, and that spouse happened to be the wife.  All things considered, it seemed fair and just to let her have her retirement.  Husband had an IRA that was totally separate, and his retirement and the wife’s pension were very close in value.  The husband had brought the real estate into the marriage and the Court recognized his right to credit for that.

Lewis v. Lewis: PROPERTY DIVISION – REMEDIES – ORDER TO PROCURE LIFE INSURANCE FOR WIFE – NO STATUTORY AUTHORITY.

When the Chesterfield trial judge in Lewis v. Lewis, 53 Va. App. 528, 673 S.E.2d 888, (3/24/09), felt the husband had subjected the wife to an outrageous injustice when he retired early and thus “deprived wife of her option, specifically granted to her under the terms of the PSA, to receive her portion of the ... pension over the course of her lifetime,” it afforded wife the remedy she sought: ordering the husband to obtain $200,000 of life insurance with her as beneficiary.  Husband of course protested that there is no statutory authority for this, and the Court of Appeals agreed that the rule of Lapidus v. Lapidus, 226 Va. 575, 579; 311 S.E.2d 786, 788 (1984), still stands.  It thus stated “We conclude that, although the trial court did not err in determining that wife was entitled to some remedy … the trial court did not have authority to order that husband obtain life insurance … .”  So a few things we have always assumed remain true – at least for now.  And if that wasn’t plain enough, The Court of Appeals explained that “under Code §20-107.3(G)(2), a trial court cannot order that a person obtain life insurance on himself for the benefit of the former spouse, although a court can order that a person elect to have survivor’s benefits on their [sic] pension or annuity.”  After unsuccessfully citing cases from other states, wife argued that the delayed-QDRO provision of the statute, §20-107.3(K), in authorizing “additional orders” to effectuate parties’ agreements, allowed the insurance-provision order.  However, the Court did not believe that the general authorization of subsection (K) could control or override the “specific provision in subsection (G) ….”  Thus, entitled as this wife may be to some remedy, “the trial court crafted the wrong remedy here.”  In a footnote, the appellate court hastens to assure the trial judge that it is by no means foreclosing the invention of some kind of remedy, so long as it is a proper one.

Favors v. Favors: ALIMONY – IMPUTATION – PAYEE IMPUTATION.

 So just what does it take to impute income, even a token modicum of income, to an alimony-seeking wife?  From a recent unpublished Court of Appeals opinion it appears to take (other than a judge who doesn’t regard it as unthinkable heresy) some thorough, imaginative and pushy cross-examination, and some stunningly damning admissions.  Oh yes, and an expert witness for the payee who’s either too honest or too naive to serve an adversary advocate’s one-sided purposes.  In Favors v. Favors, 23 VLW 1155 (3/17/09), the Court of Appeals said that it “summarily” affirmed everything, but it took them eight pages to do it, and this unorthodox holding on the payee imputation issue is thoroughly and resoundingly rationalized.  Starting in 1999, the wife in this ultimately 19-year marriage went to a doctor for fatigue and he diagnosed quite a list of ailments that sound pretty real, although they are all of a sort that is more or less subjectively diagnosed and difficult to prove or disprove – and depression.  After husband filed a divorce complaint in 2007, she answered and cross-complained, she went to “therapy” with a psychiatrist, blamed the depression on her bad marriage, and in September 2007 got temporary spousal support.  In the April/July 2008 trial, payee imputation was litigated and the judge pegged her at modest earning capacity, apparently the $19,800 to $23,800 testified to by the husband’s vocational expert, so that her permanent alimony was only $833 per month.  She got $3,000 in attorneys fees and appealed from these decisions.  Husband’s expert had testified that he thought her “mild” medical impairments would not necessarily keep her “from being in the work place on a daily basis,” and noted that the wife’s symptoms and conditions were subjective.  That expert also referred to the August 2007 psychiatric evaluation by wife’s psychiatrist.  Unfortunately for her, when she called her primary care physician, who apparently had not seen her since the 2004 consultation and did not know she had gone to the welfare department to get psychology and psychiatry, he said that if properly motivated she should be able to do some light work “but from a psychological standpoint … she’s not mentally and emotionally capable of working” because of depression.  She did not follow the recommendations of the psychologist he referred her to in 2004.  The physician had been unaware that even though she had depression back as far as 1990 from the marital problems she had continued to work from then on.  Wife’s problem got worse when her psychiatrist, a Dr. Shah, first met with her after the divorce complaint, when she sought his treatment for depression.  At trial he stated his conclusion that she was unable to work because of depression.  He added that this depression was aggravated by her marital problems and something which is not defined in regular dictionaries but would appear to be some sort of skin condition.  He testified that she sure told him frequently enough that she was depressed because of her marriage, but on cross examination he admitted that there would be less of that stress once she had a divorce.  And when his notes came out, it appeared that one of them from October 2007 said “She wanted me to document this so she can use it in court when the judge asks her why she is not working.”  Over all wife’s objections, the Court of Appeals approved the trial judge’s discretionary decision to go with one expert’s testimony over another’s, and finding that expert more credible.  Wife did make the argument that Virginia cases hold that a wife should have a reasonable time to find employment before income can be imputed by a judge.  But the Court of Appeals distinguished McKee v. McKee, 52 Va. App. 482, 664 S.E.2d 505 (2008) (en banc) on the ground that Mrs. McKee had three children at home and Mrs. Favors had indeed had her opportunity to find employment because she had been separated for approximately five years at the time of the trial court’s ruling.  Moreover, she had had ample opportunity to address her mental health problems in 2004 when she first was referred to a psychologist, but did not choose to do so until post litem motam in 2007.  Wife not only continued to help husband with his business until the separation, but remained quite active in her church activities all during the separation, and in fact had told Dr. Shah that she did not want to work because she wanted to continue these church activities.  Finally, the alimony amount ordered and the amount of the fee award were well within the trial judge’s discretion.  The request from each party for appellate attorney fees were denied.

Riley v. Riley: PROPERTY DIVISION – MARITAL AND SEPARATE – SOURCE OF FUNDS – TRACING PROOF.

A husband who apparently thought he would have little trouble keeping property he acquired with separate property out of the marital property division in his divorce was entirely disappointed by the trial court and the Court of Appeals in Riley v. Riley, unpublished, 23 VLW 1128 (3/10/09).  Though the husband argued that the money to buy and build a waterfront lot and the building on it came from liquidation of real property he owned before marriage, his 401K, and a premarital insurance policy, the proof, it was held, just wasn’t there.  Nor did he succeed in proving that the property was, at least to the extent he argued, partly separate.  Though he said that his contribution to the purchase and the building from separate funds was such that the Brandenburg formula would give him 80% of the net proceeds at its sale, he did not meet his burden and refute the marital property presumption on any of these counts.  The Court didn’t consider it proved that the separate funds he started this with were not commingled with marital money.  The trial court wanted “third-party institutional proof” for this tracing, and so did the Court of Appeals.  Sure the husband had had the 401K before marriage, but he didn’t show any paper to prove that he kept it separate after marriage by not contributing money or work to it.  The trial court thought he had probably used some separate money to pay the builders, but it could not tell how much separate money was used, or even how much marital money was used. As to proceeds from the sale of his pre-marital house, that was, once again, not sufficient proof to tell, to the satisfaction of either court, what were the marital and the separate components of that. 

Gilliam v. McGrady: PROPERTY DIVISION – DEBT – BUSINESSMAN’S UNPAID PAYROLL TAXES – BLAME FOR ORIGINAL DELINQUENCY v. BLAME FOR CONTINUING DELAY OF PAYMENT.

The subject of apportioning or allocating debt between spouses in an equitable distribution case under §20-107.3, which has remained somewhat mysterious heretofore, is elucidated somewhat by the Court of Appeals’s decision in Gilliam v. McGrady, No. 0288-08-2 (Va. App. 03/04/2009).  A painting contractor whose wife had a salaried job as a paralegal left his employment taxes unpaid and the debt was still there to divide as negative property at their divorce.  So how is it fair to do this – by calling it separate and leaving it with the businessman husband, or calling it marital and dividing it, and if dividing, then how?  The unchallenged evidence showed that the husband let this important matter go originally, but the wife, knowing fully about it, went on helping him live beyond their means and willingly participated in leaving the delinquency uncured.  So if it’s a matter of reward and blame, should it be allocated to the one who originally let it go, or to both of them who willingly let it continue, accumulating even more interest and penalties?  The trial court thought both, but the Court of Appeals had other ideas.  (More precisely, the trial court split the original debt 50-50 and the interest and penalties husband 65% and wife 35%).  Since the trial judge began with a ruling that the debt should be considered marital because it benefited both the parties, the Court of Appeals said you must consider more factors than that.  Who originally incurred the debt is surely a factor, along with the original purpose of the expenditure (i.e., to benefit the business by leaving unpaid that portion of the employees’ salaries which should go to the federal or state government or both).  The Court of Appeals says that since it’s illogical to divide positive property and negative property with different burdens of proof, the presumption of all property being marital must apply to debt as well.  It had already been held as a factual determination at trial that both parties benefited because they both spent this money that hadn’t been timely paid in taxes.  But the trial court reasoned erroneously, the appellate judges say, and should instead have looked at both the benefit the parties got from spending the money and the use that the business got out of this unpaid money (or unpaid labor).  No, the Court of Appeals says, the judge should look at the purpose of the original debt and not to who bears responsibility for the later non-payment.  The latter treatment ignores the statutory requirement to consider the “purpose” of the debt.  The Court of Appeals considers it unfair to allocate any to the spouse who participated willingly in letting it continue unpaid.  The appellate court sees the blames as different: the duty violated by the husband was to obey the criminal law and the civil law – avoiding non-payment of federal taxes as well as fulfilling the general duties of an honest person and good citizen to pay all one’s creditors in full.  Since husband had both duties but wife had just the general duty, it would be unfair to saddle her with an equal portion of the blame.  What the Court of Appeals does affirm is the trial court’s holding that the wife had the burden of proving that the taxes were not marital debt.  That lower-court ruling was valid, because if the presumption of marital debt applies to both positive and negative property, that’s the result you get.

Lewis: PROPERTY DIVISION – PENSIONS – REMEDIES – SEPARATION AGREEMENTS – RETIREMENT EARLIER THAN EXPECTED – POST-DIVORCE QDRO.

When Virginia’s pension division statute was first sold to and passed by the Legislature, the assumption on everyone’s part, and the way you explained it to people, was that the non-employee spouse gets her cut of each monthly pension check if, as, and when received – so she doesn’t get paid until he gets paid. And if he retires early and gets a lump sum she gets a lump sum, and if he takes it out monthly over the rest of his remaining years that’s how he gets his and she gets hers, and what could be fairer than that?  But now it appears, from a Court of Appeals opinion known as Lewis v. Lewis, 53 Va. App. 528, 673 S.E.2d 888, (3/24/09), there is a whole moral and sexual-political dimension to this, of which we hitherto have been totally unaware. But the Court of Appeals, if you give them time, will explain it all to you in their fifteen-page opinion.      

     Most Virginia lawyers, if you asked them what happened in the Lewis case, would probably answer “Oh some kind of huge QDRO mess.” But FLN, having had to do so, sought to explore it fully and will do its best at an explanation which it at least hopes is accurate.

       A Chesterfield husband apparently executed a separation agreement dividing his pension from Philip Morris, as well as his profit-sharing plan. The separation agreement more or less contemplated a retirement date much later than the one that husband in fact took. As the Court of Appeals saw it, the separation agreement didn’t deal – or at least didn’t deal satisfactorily – with the apparently unforeseen eventuality of his “retiring early.”  The Court of Appeals uses lots of morally judgmental terms, such as “unilateral” which by now has a whole pejorative subtext, to describe what he did to the hapless wife by taking this early retirement date. So just what exactly did he do to her by pulling the rug out from under the agreement’s comfortable assumptions?  He deprived her of the sacred and inalienable right to choose between getting her pension in measured increments over the course of her remaining life. To say that the unilateralness deprived her of a choice is a bit confusing, since the Plan seemed not to let her choose lump sum if the husband didn’t choose lump sum, but as with alimony, losing the periodicity was an enormously churlish deprivation of a major substantive benefit. Could the trial court give effect to the intent of the separation agreement and afford wife a remedy for this delict?  Indeed it could, and it did, and properly so, according to the Court of Appeals. This husband worked for Philip Morris throughout the 20-year marriage, and was still working there when the parties separated in 2003. They signed a separation agreement in 2004 that gave her alimony, but only until the time of his retirement. Upon retirement, the agreement did not exactly give wife an if/as/when award as such, but stated that “the marital share of Husband’s pension shall be divided 50/50 by a QDRO, by applying a coverture fraction to the accrued benefit as of the date of separation, and Wife shall receive a separate share paid to her for her lifetime based on her actuarial life expectancy.”  Apparently the ambiguous relationship between actual life and actuarial life was not clarified very much by this agreement, but the word coverture did throw some law clerk for a loop, as a lengthy footnote hastens to explain to us all that this oft-used legal term “is an archaic term referring to the condition of being a married woman” according to Black’s, and goes on to explain at great length, with citations to Turner, etc., that some archaic persons use a “coverture fraction” to do that mysterious thing that we do all the time with marital pensions.

     Now the old-fashioned lawyers who drafted this archaic agreement also divided a profit-sharing plan, requiring the trial court to enter a QDRO directing Philip Morris to pay an appropriate part of the profit-sharing account to wife, and another one directing the same from his monthly pension payments. The Court entered the divorce decree, leaving the QDROs still being fine-tuned and argued over, but this decree specifically stated that it was not final but was reserving QDRO authority. But before any QDROs got entered, the husband “unilaterally retired” and stopped paying the alimony, and then filled out his retirement forms by checking a box indicating that he wanted his pension “as a single life annuity, and without any survivor benefit.”  He thus got the full pension amount each month until his employer froze the pension benefits because of the pending case. Wife got her pension split for the term of his life, not hers, and (something on which “the parties agree”) that was because the rule at Philip Morris seems to be that after retirement begins, “the current payouts under the pension plan cannot be altered to provide wife with benefits for her lifetime,” and thus for this couple all payments stop upon husband’s death.

As for the profit-sharing account, husband withdrew the entire balance of $1,114,905 without consulting wife, and bought himself two annuities – which he certainly did not share with her. And although he withdrew $44,565 from one and $8,242 from the other over the next six months, the combined balance of the two accounts still grew by over $24,000 over that period. Apparently it was stipulated that at the time of separation, wife’s part of the profit-sharing account would have been $187,517. The wife then filed a motion asking the court to enter a QDRO to give her $1,658 per month from the date of retirement, and that husband be ordered to procure life insurance to make up for her ill-treatment. The court agreed and awarded the wife $1,246 per month from the pension, required that he obtain $200,000 in life insurance and awarded wife her share of the profit-sharing account, with interest from the time of separation, plus attorneys’ fees.    

     Husband argued, first, that the court’s award gave wife pension benefits based on and earned by his employment after the 2003 separation date. The evidence, the Court says, supports the trial court’s finding that the pension benefit was worth $3,719.92 per month on the June 1, 2003 separation date, and that the appropriate value was used in applying the coverture fraction to determine the statutory “marital share.”  The evidence did not, however, support husband’s argument that wife was getting, by virtue of the $3,719.92 per month valuation a split of the benefits that he earned after separation. A very lengthy footnote explains that divorcing parties usually divide the marital portion of a pension by an if/as/when award without needing to know the actual amount of the future monthly benefits. Thus the court did not err either in the valuing nor the dividing of the pension plan. As to the profit-sharing account, the agreement gave the wife “half of the marital share” of that account, and husband conceded that wife was due $187,517 of the balance on the separation date. But he contended that she could not get any interest that accrued after that date, and that the trial court erroneously awarded her the growth on that account after separation. Concluding that neither Fahey v. Fahey, 24 Va. App. 254, 481 S.E.2d 496 (1997), nor Baker v. Baker, 38 Va. App. 384, 564 S.E.2d 164 (2002), applies to a separation agreement provision like this one, the Court upheld the trial judge. Here, no court order nor agreement provision stated that the wife was entitled to half the marital share “as of” any particular date. The agreement nowhere specifically states that wife was intended to have only half the actual amount in the account as of the separation date, but just says that she gets half of the marital share. The marital share, the Court says, is something which accrued passive interest after the separation and after the agreement’s execution. The interest is clearly not part of his separate portion of the account, nor of his part of the marital share. The interest on wife’s portion of the marital share belongs to her. And moreover, in this case “husband took from wife the ability to control her portion of the profit-sharing account, without her permission. He exerted control over her portion after the PSA had specifically divided that account so that husband was no longer entitled to control that money.” In awarding the wife the growth on her part of the account after the husband took the money and put it into the annuities, “the trial court simply gave effect to this intention of the PSA, which husband had frustrated.”  In fact, the cCourt says, with even more indignation, “husband acted unilaterally, taking upon himself the responsibility for wife’s money,” and he should not be entitled to profit from that.

Hamilton: CHILD SUPPORT – MODIFICATION AND CONTEMPT – WILLFULNESS ELEMENT – PAYEE IMPUTATION.

In a rare opinion that combines downward modification and payee imputation as to child support, the Court of Appeals says a couple of things which, were it not an unpublished opinion, would raise some doubt about the time-honored, if draconian, rules in this area.  In Hamilton v. Hamilton, unpublished, 23 VLW 527 (10/7/08), the Court of Appeals said it was all right for a Fairfax Circuit Court to impute income to the mother, who had retired from the Navy and obtained (you might say) another job paying $24.55 per hour but then had (sort of) quit that and gone to work as a part-time social worker at $14.71 per hour.  The only reason the mother gave for the job change was that she wanted to “work with troubled youth.”  As for the mother’s interesting objection that the trial court had no business reducing the father’s support when he was in arrears or in some respect non-compliant with the existing order (in fact, he unilaterally halved his payments when a child aged out), the trial court’s reasoning was that he was not in contempt of the old order, because — listen up — because the element of willfulness hadn’t been proved, and the Court of Appeals affirms that.