Virginia Family Law Appeals

Negative equity, divisible at Judge's discretion - Va.Ct.App.

PROPERTY DIVISION – DIVISION OF NEGATIVE  EQUITY. It would seem to be elementary common sense that if there ain’t no equity -- nothing  there – you can’t divide it. But as you all know, when lawyers get involved, nothing is the  way it seems, nor simple either. And when eager, ambitious lawyers get involved (and greedy  --- though on their clients’ behalf of course), such adversary advocacy , especially when driven by the paranoia of the defensive practice mind - set  and the VSB’s concept of zealous loyalty to all clients, makes  them feel an obligation that dictates running every abstract and convoluted new theory up the flagpole.  It would seem that most trial judges have remained unreceptive to the negative-equity-division theory. Debt can always be divided, and dissipation remedied when proved, but negative equity has other abstract and theoretical dimensions that there’s no need and no excuse for courts going into – certainly not when the same can be skinned another and simpler way. And now we know that the Court of Appeals agrees. So says   Fox v. Fox, 61 Va App 185, 734 SE 2d 662 (12/4/12).  If the judge went through the three mandatory steps and divided the property interests according to all the listed factors of § 20 – 107.3 E that apply – not abusing his or her discretion in the process – the Court of Appeals can’t and won’t second-guess him/her and re-distribute it. Of course the  Court has already said this simply and plainly in Hodges v. Hodges, 2 Va. App. 508, 347 SE 2d 134, in 1986, and said it is simply and plainly as it could (page 667). But Hodges involved a monetary award, of course, and that is not exactly, in so many words, a property division. And to satisfy all possible critics or non-comprehenders, the Court plays around with the negative-equity-division idea for a while. Explaining what else, besides just not going there, the judge could have done here. (Summarizing in one paragraph). It almost explains, as it did in Alphin, 15 VA APP 395, 424 SE572 (1992), that the “may” in §20 – 107.3 (C) – “the judge may divide jointly owned marital property” – is (yes, Virginia) discretionary, and not, as the appellant husband argued, “permissive only to the extent that the trial court has several options in dividing or transferring” property, but without the option of just refraining from dividing it. Explaining with examples, it says that awarding one party whole value of the property or requiring one party to buy the other’s half or ordering public sale of the zero-value property, were options which “were useless and absurd and grossly inequitable in the circumstances, as ”Code §20 – 107.3 does not mandate such draconian result.” Here both parties, for whatever reason, requested the court to divide it, but evenly, so the judge did not abuse discretion by refusing.

"Seen and Objected" sufficient on appeal - Va.Ct.App.

CHILD SUPPORT ENFORCEMENT – USIFA – REGISTRATION-INTERSTATE MODIFICATION – APPEALS – RULES 5A:18, 5A:20 – LEE v. LEE – NEW TAKE ON “SEEN AND OBJECTED”. The subtleties and complexities that bedevil lawyers trying to litigate cases under the Uniform Interstate Family Support Act, §§ 20-88.32 – 82 here in Virginia, show up with a vengeance in Moncrief v. DCSE, 60 Va. App. 721, 732 S.E.2d 714 (10/9/12). There the parties, the lawyers and the circuit court below wrestled with those complexities and the Court of Appeals patiently sorts it all out. The defendant father argued that registration of the North Carolina order by Virginia perverted the process, modifying his child support obligation by extending it, which registration and interstate enforcement is not supposed to do. The short answer to all this from the Court of Appeals is that the registration can’t be overturned now, and it has to embody exactly what the North Carolina court did in 1997, even if that court acted improperly by turning an order from New York (where liability extends to age 21) into a Carolina order. But perhaps the biggest news – if this precedent should happen to hold – is that the Court of Appeals, perhaps wanting to hear this case, rejected the appellee DCSE’s argument that the father should be out of court because the order below was endorsed “Seen and Objected To” for reasons stated in oral argument and noted on the face of the appealed order. This, the Court of Appeals says this time, is enough: it preserves the claim, because after all, the appellant made the trial court aware of his position below. He had written pleadings setting forth his objections and arguments against the registration, he had filed some sort of objections three months before that final order, and these are exactly the same arguments he now makes on appeal. And although such common-sense reasoning has never cut any ice for many years now, since Lee v. Lee first came down, all of this has to be enough, the Court of Appeals says, and thus it complies with Rule 5A:18. Then DCSE tried a 5A:20 (c) objection that father made no clear or exact reference to the pages where he had reserved each assignment of error and the pages in the appendix that showed each fact in his Statement of Facts. But the Court of Appeals, now on a roll, says that the appellant’s failure to adhere strictly to the requirements of Rule 5A:20 (c) were “insignificant and not so substantial as to preclude us from addressing the merits of the case.” Sure it might look like the father had a good argument because the 1997 North Carolina order improperly extended the duration of his support obligation for three years, essentially turning a North Carolina order into a New York order, doing something North Carolina law doesn’t allow -- but when a new state registers a foreign order, they can only register it like it is, and that makes it “the controlling order.” Well wouldn’t this be a case where North Carolina didn’t properly have jurisdiction to do a thing like that? Not so, the Court of Appeals explains, because New York lost continuing exclusive jurisdiction when everybody moved out of New York, so North Carolina had the jurisdiction to do this, and the fact that the new court followed New York law and not North Carolina law and ended up extending a support obligation beyond Carolina limits can’t be challenged now (as it could if North Carolina had not had jurisdiction). North Carolina got continuing exclusive jurisdiction when the whole family moved there, and the Carolina court did not err in finding that its order was now the controlling order by 1997. And what about the fact that the North Carolina order doesn’t mention duration at all? All this means, the Court of Appeals explains, is that a North Carolina court did just what the Virginia Court of Appeals now says it did. Its silence did not mean that it automatically turned the New York order into one which complied (concerning duration) with North Carolina law. Rather, this order was not really silent because the 1997 NC order declared that all provisions of previous orders not modified therein should remain in full force and effect. Therefore, the Virginia trial court didn’t err in looking to the original 1994 NY order to determine how long support would last, and concluding that it was to age 21.

Unmarried "illegitimate" fathers' rights protected - Va.S.Ct.

LEGITIMACY & PATERNITY – FATHERS’ RIGHTS – RULING ON ILLEGITIMATE FATHER’S RIGHT TO ESTABLISH PATERNITY AND PARENTHOOD UPHELD. The Court of Appeals holding in Breit v. Mason, 59 Va. App. 322, 718 S.E.2d 482 (2011), was affirmed by the Virginia Supreme Court in an opinion by Justice Mims on January 10 as L.F. v. Breit, 285 Va. 163, 736 S.E.2d 711 (2013). The Supreme Court agreed with the Court of Appeals that  the Assisted Conception Statute must not   be read to exclude from legal fatherhood an illegitimate father simply because he and the mother did not marry. Though the statute intends to prohibit “sperm donors” from suing to establish parental rights, it cannot properly or constitutionally be interpreted to exclude those who undertake with a willing lady friend a joint project  to become  unmarried parents in the same household. Moreover, that statute cannot be applied to exclude a father in a case like this, who enters into a binding voluntary contract as to custody and care of the planned child.

Rule 4.2, ending conversations with unrepresented adversary party, "immediately does not mean simultaneously" - Va.S.Ct.

LEGAL ETHICS – RULE 4.2, CONTACT WITH REPRESENTED ADVERSARY – 60-SECOND CALL – VICTORY FOR COURTESY AND COMMON SENSE. Maybe this is the kind of thing our society gets…Strike that. Obviously this is precisely what our society, and our profession, get from praising, applauding, and glorying in the much-celebrated “zero-tolerance” policies which encourage the wooden, dictatorial absoluteness, and encourage those in even the lowest positions of power to oppress their fellow humans with a self-righteous and ruthless missionary zeal. The same mind-set is obvious in school teachers and administrators decreeing the ultimate sanctions in their arsenals upon little boys pointing their fingers at others in a supposedly gun-like manner, doing the same with little sausages or half-eaten sandwiches, or bringing a two-inch plastic battle axe from a Crackerjack box to school. As we all know, Disciplinary Rule 4.2 prohibits contact with an unrepresented adversary party, and as careful lawyers know, it has a Comment 3 which adds that that this applies even when the party contacts you, and that when that happens you must terminate the conversation “immediately.” And by now we all know about the nice young lawyer who had to take a call for her partner in his absence, and once she realized who the caller was, referred her to her own lawyer and ended the conversation politely but firmly after about 60 seconds — and was punished for not doing it by hanging up immediately without saying anything. Though it was sustained by the three-judge court, our Virginia Supreme Court reversed that holding on February 28 in Zaug v. VSB , ____Va.____, ____S.E. 2d_____, Record Number 121656. The opinion is very instructive, for in holding that “immediately” does not necessarily mean simultaneously, the Supreme Court patiently and perceptively analyzes the issue, giving good guidance for future cases. The ethics rules and the oath a lawyer takes upon joining the Bar require professionalism and courtesy, and to force a lawyer to suppress even a tiny showing of concern for human misery, and punish her for even the most minimal use of courtesy in refusing to talk to the opponent would require her to violate the Rules, her oath, and the Bar’s recently-adopted “principles of professionalism”. (Never heard of them? Well of course, you have to go to the VSB web site for that.) The facts were partly in dispute at the disciplinary hearing, and the Supreme Court explains that it re-examines all the facts in these cases and the State has the burden of proving the violation by clear and convincing evidence. The Supreme Court after its “independent examination of the entire record” gives the trial court’s conclusions less than the weight of a jury verdict, but will sustain them unless they are “not justified by a reasonable view of the evidence or are contrary to law.” The interpretation of the Rules of Professional Conduct is a question of law, reviewed de novo. Now Comment 3 says the lawyer must immediately terminate the communication initiated by an adverse party when the lawyer learns that she is speaking with that prohibited person. The only exception Comment 3 allows to this is when the represented party is seeking a second opinion or replacement counsel. (Though one does wonder how that would work if this seeker of second opinions, etc., is contacting her present opposing counsel.) The three-judge panel “resolved” the factual dispute by a summary affirmance, without any factual findings and without an opinion. So everything remained for the Supreme Court to resolve. Ms. Zaug admitted that as soon as the call came in she could deduce that it concerned the deposition in this case, which her partner had already left to attend. But the disputed and ambiguous record, the Supreme Court says, “does not disclose when she became aware that the caller was a represented person.” She testified that she did not know that it was Yanira Copcutt, one of the plaintiffs in this medical malpractice case, until the caller started describing the emotional toll the litigation was having on her family. (The lawyer described a sort of cascade of feelings as “an emotional outburst.”) The caller later said in a disqualification hearing that it was obvious from the beginning that the lawyer knew who she was, that the lawyer asked her what was wrong with the deposition she was objecting to, and heard Yanira say she wanted to dismiss the lawsuit. Another lawyer in the office came along in time to hear Zaug’s side of the conversation, only for about the last 30 seconds of the call, and he corroborated Zaug’s version. Actually, the Supreme Court observes, the Bar’s district committee made no findings resolving the factual dispute. The Supreme Court patiently explains, there are three separate facts the Bar must establish for a violation of Rule 4.2: first, that the attorney knew she was communicating with a person represented by counsel; second, that the communication was about the subject of the representation; and third, that the lawyer was not “otherwise authorized by law to engage in the communication”. Since the record does not disclose when Ms. Zaug became aware of who the caller was, a crucial element was not established. Now the district committee’s only fact-finding on the crucial point was that the lawyer “was aware she was speaking with Copcutt either at the time she took the telephone call or concomitantly therewith.” The Supreme Court says only, “We are unable to decipher the meaning of this finding.” It recites Webster’s dictionary definition of concomitant, but to no particularly useful purpose. Anyway, that finding “does not determine whether  Zaug knew both (a) the identity of the party with whom she was communicating and (b) the subject of the communication.” And further, “at oral argument, the State Bar conceded that there was no evidence of how much time had elapsed between the instant Zaug knew both pieces of information and the end of the call.” The lawyer testified that she said only “I’m sorry. I can’t help you. You need to try to reach [your attorney]. I’ll try to contact [her colleague] and they’ll have to sort this out,” and hung up. As for the meaning of “immediately” in Comment 3, the State Bar argued that she should have hung up instantly upon realizing who the caller was. Zaug argued “that such conduct would violate the principles of professionalism which infuse and imbue the proper practice of law.” She further argued that “immediately” does not mean “instantaneously,” and that the rule “does not obligate an attorney to hang up on a represented person without regard to courtesy.” The Supreme Court responds simply, “We agree with Zaug.” Being admitted to the Virginia Supreme Court bar, the Court noted, attorneys swear that they will “faithfully, honestly, professionally, and courteously” demean themselves in the practice of law. And the State Bar “principles of professionalism” begin with “from Thomas Jefferson to Oliver Hill, Virginia lawyers have epitomized our profession’s highest ideals. Without losing sight of what lawyers do for their clients… All Virginia lawyers pledge to demean themselves ‘professionally and courteously.’” Those principles of professionalism include a lawyer’s recitation that “I should treat everyone as I want to be treated – with respect and courtesy.” As for the Rules of Professional Conduct, the Supreme Court says, “they exist to further, not to obstruct, the professionalism of Virginia attorneys. Professionalism embraces common courtesy and good manners, and it informs the Rules and defines their scope. Accordingly, we will not construe the Rule to penalize an attorney for an act that is simultaneously non-malicious and polite.” Now the State Bar argued that to permit this young lady’s conduct would create a “distraught caller exception” or a “60-second call exception” to Rule 4.2, “obscuring an otherwise bright-line rule of ethical conduct.” And while the Supreme Court admits that the Rule “categorically and unambiguously … requires an attorney to disengage from such communications when they are initiated by others,” it declares that “the rule does not require attorneys to be discourteous or impolite when they do so.” Supplying some valuable guidance for various future cases that might arise, the Supreme Court noted that this case includes no evidence that the lawyer “intended to gain advantage from it,” and no evidence that she “deliberately or affirmatively prolonged it.” It concludes: “On these specific and narrow facts, in construing Rule 4.2 to advance behavior that is both professional and ethical, we conclude that no violation occurred in this case.”

PROPERTY DIVISION – MARITAL & SEPARATE – TRANSMUTATION – USE AS COLLATERAL FOR REPAID MARITAL LOAN - Va.Ct.App.

In case you wondered, as many of
us did for a while, whether the use of separate property as security
for a loan that was used for and repaid from marital funds will
necessarily transmute it, that question was before the Court of
Appeals in Layman v. Layman, 62 Va. App. 134, 742 S.E. 2d 890
(6/11/13), where inherited separate property was mortgaged for money
that was spent, for clearly marital purposes, and the loan is repaid
with marital property, but had already been fully paid off. Sure the
trial court erred in classifying this property as marital, the Court
of Appeals said. For those who need any more analysis, equity in the
inherited property had already been built up, and paying off the loan
did not increase its value. Increases in the value of all the parties’
combined real estate was conceded and the trial court said that
discharge of any debt secured thereon affects the results and the
increase in equity in the asset increases its value, citing Gilman v.
Gilman, 32 Va. App. 104, 119; 526 S.E. 2d 763, 770 (2000). The trial
court viewed this as co-mingling, so that all the real estate together
should be considered marital property. In short, the Court of Appeals
did not say and mean these things in Gilman, and it went extensively
into the facts of that case to show that its words had been
misunderstood. It said that “the trial court’s error is manifest,
because nowhere in Gilman did we discuss the effect of repaying the
balloon note on the classification of the… stock.” Inherent in the
bailment relationship is that the property is to be returned to the
bailor.

Costs awarded, fees denied to respondent in Hague Convention case - Va.Ct.

CUSTODY – INTERNATIONAL REMOVAL – HAGUE CONVENTION – FEES. Interpreting the Hague Convention on parental abduction and the International Child Abduction Remedies Act, the federal district court for the Eastern District came to a conclusion that is hard to avoid from the wording of the Convention itself and the implementing federal statute, 42 U.S.C. §11607, and denied a successful respondent custodial mother a fee award. The federal judge did find that he was authorized to award her costs under Federal Rule of Civil Procedure 54(e)(1), using inherent powers of the court. However, as it enumerates the costs that she doesn’t get, one wonders what non-fee costs might be left for her to collect. The husband and wife were living together in Switzerland when they separated. The father is a British subject and the mother an Iranian citizen, and the child is a Swiss citizen. After hearing at some length from experts on Swiss law, the court came to the inescapable conclusion that the Swiss court’s award of full sole custody to the mother gave her the unqualified right to remove the child over the father’s objection, which she did, coming here. The judge understandably concluded that the ICARA fee provision makes fees available to only a prevailing practitioner, not a respondent. Not only does the ICARA not provide for “two-way fee shifting,” but it would be inappropriate under such circumstances to try to invoke the court’s “inherent powers” to do so. The court found authority from other circuits going the same way, but the fee shifting provision in §11607(e)(3) is quite clear. There is no authority under subsections (b)(1) or (b)(2). Finding no bad faith or abusive actions on the plaintiff father’s part, and his claims not frivolous, the court considered this just. He failed to prove by a preponderance, though he did bring on some evidence, that removing the child violated his rights under Swiss law, or was for the purpose of denying him his visitation rights. The issues being close, the court still found it equitable to award some costs, but specifically excluded transportation, courier, copying, faxing and scanning. White v. White, ___ F. Supp. ___, (9/13/12), opinion by Judge Ellis of the Alexandria Division.

Process service to multiple addresses unnecessary - Va.S.Ct

PROCEDURE – SERVICE OF PROCESS – SUBSTITUTED – MAILING ADDRESSES. A recent service-of-process case, though the point may seem obvious to some, will be of considerable use to some family lawyers. In a situation where service by mail is permitted by one of the bewildering multitude of service statutes, this case answers the question whether a plaintiff who has two mailing addresses for the defendant has to serve at both of them. This commercial case involved, in fact, a contract which said that any notices for the company had to be sent to a Miami P. O. Box, and the fact that Virginia Tech also knew of a street address did not mean, the Supreme Court said, that it had to serve the street address too. The Supreme Court did not just go with the contract point as ending debate, but waded into the due process & statutory-construction areas anyway. The defendant made the novel argument that a statute that lets a plaintiff “pick and choose” among service addresses is facially unconstitutional. Certainly the substituted-service statutes such as the §8.01-329(B) and default judgment statute, §8.01-428(D), the Supreme Court said, do bring into play basic due process principles of fairness and substantial justice, requiring a likelihood that the chosen method of service will in fact inform the party of the litigation pending against it. But the Supreme Court considered those principles well served when a plaintiff having two addresses (for a corporation after all) uses but one of them. The company tried a downright silly argument that it had a right to double mailing service because the statute uses “the” last known address rather than “a” last known address, but the Court patiently explained to the company what “the” means and what “a” means, resisting any temptation to speculate about how counsel got them backwards. It does quote a few of the many cases saying that the construction of statutes should go by the plain, common and accepted meaning. Virginia Polytechnic Institute & State University v. Prosper Financial, Inc., ___ Va. ___, 732 S.E.2d 246, (9/14/12)

U.S. Supreme Court "Summer of Family Law" Began By Preempting Virginia Life Insurance Law

 FEDERAL LIFE INSURANCE (FEGLI) BENEFITS – BENEFICIARY DESIGNATION CONTROLS. It probably comes as no surprise to many lawyers that the U.S. Supreme Court upheld the Virginia Supreme Court’s ruling in Maretta v. Hillman. This was on June 3, and now it’s Hillman v. Maretta of course. You may remember that Mr. Hillman, the federal employee, who had been divorced in 1998, had not changed his employee designation of beneficiary when he died in 2008. Federal statutory law says the designation designates and determines it, and the federal statutory law controls. Virginia law is preempted, as the Constitution’s Supremacy Clause is pretty clear. So is the practice pointer here, and you have probably been told already numerous times that you should tell your federal employee client who wants or is facing a divorce to get that designation changed right away – which, considering the formal requirements for designation change and the role of an existing spouse or former spouse, is easier said than done (but perhaps a lawyer can consider his or her job done once the basic admonition is uttered – and recorded).

Related articles

Retired U.S. Supreme Court Justice Sandra Day O'Connor Reflects on Her Career and the Judiciary in Exclusive New Video Series