There are many highly emotional issues associated with divorce that may become matters of contention, especially when the parties are unaware of the advantages of finding a compromise. From determining child custody to the division of marital assets, it is important to be able to recognize the consequences and effects that your decisions may have on the legal process, your emotional health, and your family's best interests both during and after your divorce.
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Hosted by: Dan Couvrette, CEO, Divorce Magazine
Guest speakers: John Harding – Family Law Attorney. John Harding is the principal of the law firm of Harding & Associates in Northern California. He practices family law litigation and divorce mediation exclusively. John has been recognized with an AV certification by Martindale Hubbell Peer Review Ratings and is a Northern California Super Lawyer, and has been since 2004. He has written and lectured in the areas of civil litigation, family law, trial skills, case management, and legal technology. Learn more at www.hardinglaw.com.
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Read the Transcript of this Podcast Below.
So, I’m going to give you a question that a divorcing person wrote into us, and the first question is, “Now that my spouse and I have officially separated, I’ve moved out of our home last month. Am I responsible for debts he may incur or is he 100% responsible for new debts? I ask because he’s in the process of financing a new car.”
Harding: Dan, for that new car, and for most debts that are created after a couple has separated, there is not joint responsibility. I’m responsible for the new debt that I create after the separation and you are responsible for the new debt that you create after separation. And you can take comfort in the fact that no matter how many new bills I’m racking up out there, you don’t have any responsibility for them.
Now, that doesn’t say that you and I aren’t going to continue to share responsibility for certain debts that we had during the marriage. For example, the $10,000 credit card bill that we had when we separated or the existing loan on a car that you and I have been driving during the marriage. But as far as new debt is concerned, yours is yours and what is mine is mine.
I see. And what happens in the case where one spouse thinks that the other spouse is hiding assets? What do they do to determine whether that’s true or not? Can you help them with that?
Harding: Well, that doubt is not misplaced. Unfortunately, there are lots of folks who, once they go through a divorce, invest a lot of time and energy in trying to conceal information. In fact, it is a problem that is so severe and so significant that, here in California, our legislature has actually enacted very, very substantial legal sets that require spouses of divorce to disclose any and all property, and any and all information
regarding income, assets, and debts.
So if you are going to go through a California divorce, you are going to be compelled to disclose all of that information whether you want to or not. And the other spouse, when they receive those disclosures, is going to have some idea as to whether or not their premonition about concealment was right or wrong. Beyond those mandatory disclosures, there are also other tools that are available to the divorce lawyer to make sure that all property, all assets, all debts, and all income are being disclosed and addressed in the divorce case. So, while your feelings are certainly warranted, hopefully by utilization of the disclosure laws that exist in California and by availment to the discovery tools that exist in family law litigation, we can assure that there is no actual concealment once the actual divorce case takes place.
And is there a consequence, John, if somebody doesn’t disclose assets that they have and they are found out as having not disclosed those assets?
Harding: Absolutely, absolutely. And, Dan, they can be quite severe under California law. For the most part, California is what is called a no-fault state. The court isn’t going to spend a lot of time asking why the parties are going to get divorced. They are just going to accept the representation that the marriage is at an end and then energy is going to be spent in terminating that marriage through the legal process. However, if it is determined that one of the spouses has failed to satisfy or meet the disclosure obligations that exist or that spouse has intentionally withheld information, then we can make an exception to the idea of no-fault. California can convert the case to a fault case and then the court can make a disproportionate division of all of the property.
If you and I are getting a divorce and it is found that I have withheld information to your disadvantage, then the court can punish me by giving you all of our marital property. A classic example that many people are already familiar with is the woman who bought a lottery ticket while she was married. The couple separated. She won. She won a million dollars from the California lottery. She did not disclose those winnings as part of her divorce case. Later, the now ex-husband gathered enough information that he was able to discover on his own that she had won a million dollars in the lottery. He took the ex-wife back to court and to punish her for her failure to disclose those lottery winnings, and the entirety of those one million dollars was awarded to the husband as the innocent spouse in that concealment. So, there can be very, very draconian consequences if there is an intentional failure to disclose or an intentional concealment of information.
John, what happens when one spouse has been the stay-at-home spouse and the other one has been out working, and the one that’s working has the feeling that, “Gee, I shouldn’t have to give half of my assets to my spouse.” Is there anything they can do about that?
Harding: Probably not, Dan. The essence of community property system like that that exists in California is that any property acquired during the marriage is presumed to be community, meaning it is presumed that each spouse has an undivided 50% interest in that property. At the time of divorce, all of that community property is going to get divided 50/50.
Now, there are some exceptions, but they are very limited. So, if you were the spouse who went to work all day, every day, during the marriage and you feel that there is an injustice now that there is a divorce, you are just going to have to accept that your personal position is inconsistent with the law that has existed in California forever.
What happens in a case where one spouse is to pay the other spouse spousal support or child support? Can they be forced to get life insurance on themselves, so that, in case something happens to them, those payments would keep on coming or there would be some compensation for the person receiving the payments?
Harding: There is precedent in California for the forced purchase of life insurance to replace support if the paying party should pass away. So yes, that is within the power of the California family law judge. Before the California family law judge can exercise that power, she has to find that the spouse paying the support has the financial means to make those life insurance premium payments.
Harding: So yes, it’s very, very common.
And what happens in the case of medical insurance where one spouse is covered by the other spouse’s medical insurance that they get through their work? Would they still be covered through that medical insurance or does that end?
Harding: They probably will not be covered.
Mini-lecture on insurance law: most insurance policies have language within the actual policy that provides that a spouse will be eligible for coverage. Once the divorce is terminated, we no longer have a spouse who can be eligible for continuing life insurance coverage under that policy. So, the general rule is that no, once you get a divorce, you will not be able to stay on your ex-spouse’s health insurance and you are going to have to go out and purchase your own insurance.
I see. What happens in a case of shared debt? Say during a marriage, for instance, one of the spouses started a business and lost money. Are both of the spouses equally responsible for that debt that they may have got as a result of that failed business?
Harding: Yes, that’s the general rule in California and that goes back to the idea of community property. It is not just assets that come within the definition of community property; it’s also debts. And just as assets are presumptively divided 50/50 at divorce, so, too, are debts.
Now, there are certain specific exemptions to that, one example—the strongest example—being student loans. But the general rule is that debt is going to be allocated 50/50, unless that 50/50 would work in extreme and rare hardship upon one of the spouses.
I see. Is that also the case regarding pensions? Are they split on a 50/50 basis as well?
Harding: They are, Dan. And that can be a very, very emotional issue for a lot of people. Many times, after a house, a pension is going to be the single biggest asset that exists. And a pension is oftentimes interpreted as the sweat equity of the employee who went to work each day and who created those pension benefits through effort everyday on the job.
We tend to look as a pension as mine, mine, mine, because I’m the one who did the work to earn it. But that’s not how it’s interpreted under California law. Those pension plan benefits that were earned during the marriage are, again, community property. If the entirety of your pension was earned while you were married, then the entirety of that pension is community property and it is going to be divided 50/50.
Okay, staying on the subject of money, I just want to talk about alimony for a moment. How long can somebody expect to collect alimony if they actually are awarded it during their divorce?
Harding: Well, we have to answer that question in two parts for California.
California has a law on the books that defines a marriage of less than ten years as a short-term marriage. By the laws in California, if there is going to be an award of spousal support in a short-term marriage, the presumption is that the duration of that spousal support should not be for more than one-half the length of the marriage. So, if you have a four-year marriage, if there is going to be an award of spousal support, it
shouldn’t be for more than two years.
There is not a similar law for marriages that are longer than ten years. That can be a real guessing game for the parties of the divorce case and for their lawyers in trying to settle the issue of spousal support in a long-term marriage. Because all the laws tell us is that it is left up to the discretion of the judge, so whatever the judge thinks is fair is what will stand as a court order.
It’s a guessing game because the primary goal in a divorce is to keep the case out of court. So, when we are negotiating spousal support on a long-term marriage, we are trying to guess at what a judge is going to do when the last thing we want to have happen is for us to have to actually get in front of that judge. It is quite possible in a long-term marriage, a twenty or thirty year marriage as an example, for there to be a
life-time spousal support.
Right. So, you don’t want to take your chances in front of a judge if you can help it because you want to come to an agreement through negotiation.
Harding: Yeah. Fortunately, we do have the statute of the law of a short-term marriage that gives us very strong guidance so that we can get that issue resolved in a shorter marriage. We do have some indications for a long-term marriage. They’re not perfect. It does require some creativity to resolve that issue, short of going to court. But that’s certainly what you want to try and do.
Right. Let’s move on to talk about children for a moment. How will custody of the children be handled in the divorce? What’s the process for that?
Harding: Again, let’s remind our listeners that everything in a divorce is negotiable. And we would certainly hope that, through negotiation, the parents themselves could come up with their own solutions for their children. Who better to decide the fate of children than their own parents? Unfortunately, that doesn’t always happen because we see thousands of cases in courtrooms in California every day where they’re fighting over the kids.
The legal test the court applies is based on what is in the best interest of the children. It’s not what mom wants, it’s not what mom needs, it’s not what dad needs. It’s what the children need so that they can thrive.
And what happens in divorce negotiations, what happens in the court system, is that we all invest energy in trying to come up with a parenting plan that allows our children to grow and to thrive as people. We are trying to set up the best living environment for the children. We are trying to create the best social environment for the children. We are trying to facilitate a schedule that allows the children to be with each parent as much time as possible, while still allowing them to live all of the other elements of their lives. We really want to fashion a parenting plan that creates the greatest environment physically, emotionally, and intellectually for the kids that we can. That’s what we’re after.
And you want the parents to be actively involved in creating that plan for them. How does something like a joint custody usually work? Just to give some people some guidance in that area who might be listening.
Harding: Well, a joint custody contemplates equal time for each parent with the children. We refer to it in the trade as a 50/50 schedule.
Now, that just boils down to counting the days. In a true joint custody agreement, each parent is spending 50% of the children’s time with the children. We can break that down any way we want. The easiest way to visualize is a week-on, week-off arrangement. Every Sunday, the kids move from one parent’s house to the other. Though we are only limited by our own creativity and, again, what we think is best for the kids.
For younger children, a week away from a parent may not be the best thing for those children. So we are going to come up with a schedule that has more exchanges, but then allows less away time for a parent. We might have a two-three schedule—two days with mom, two days with dad, three days with mom and then we repeat the process, but two days with dad, two days with mom, three days with dad. We’re dealing with seven-day weeks. Seven is an odd number. So we are going to have to adjust to get to a true 50/50. But that’s what happens under a joint custody.
As the children grow and become a bit more mature, they become better able to be away from each parent for longer periods of time, so that’s when you start working on transitioning towards that week-on, week-off schedule. We do know that the actual exchange, the transfer of the child from one parent’s house to the other, can be an emotional experience for the children. Even young kids would prefer that there be fewer exchanges, rather than more frequent exchanges. So one of the concepts that we’re dealing with is allowing the kids to be with each parent as much as is possible, but with as few transitions from one house to the other as is workable.
It’s really just a matter of creativity, Dan, and being able to admit what is best for the kids, rather than what is best for you. We all love our kids, there’s no doubt about that. We all want to be with our kids 100% of the time. In a divorced family, that’s just not possible. So we spend a lot of time as family law lawyers getting our clients to appreciate that they focusing on what they need, not what their child needs. Let’s recalibrate, refocus, and try to get comfortable with the idea that we’re creating a parenting plan that the child needs, even though it might cause some heartache for the parents.
Talking about the child’s interest, John, is there a situation where the child might get to choose where they live? Or is that not the proper consideration?
Harding: It’s possible, Dan. If a California couple finds themselves actually going to court to fight over custody, before they walk into that courtroom that couple is going to have to go meet with a psychologist that is employed by the court. The process is called child custody mediation, or child custody counselling. The parties are going to be forced to meet with that mediator to try and resolve their parenting disputes before they actually set foot in the courtroom in front of the judge. And that mediator, or that child custody counsellor, utilizing his or her mental health training and professional training in this context, is going to try and negotiate a resolution.
But if that negotiation and that settlement is not possible, then what that child custody mediator does is becomes an advisor to the court, actually submitting a written report to the judge explaining the interaction that she has had with each parent and explaining the requests that each parent is making. Then that mediator recommends a particular parenting plan to the judge and, as part of that process, that mediator has the prerogative to interview the children. It doesn’t always happen, but when it does, that’s when the children have a say. That’s when they provide input. They provide it to the mediator, who then reports it to the judge.
As far as when the children are entitled to have that say, it is really left up the discretion of the mediator. What the mediator is looking for is children who have reached a level of maturity such that they can communicate a preference without suffering some other collateral damage and can communicate a preference that is reflective of genuine thought on the child’s part, rather than conditioning or guilt being driven in by a parent.
Harding: To fully answer the question though, I should also deal with the idea of children actually appearing in the courtroom. That is very, very, very rare. Most judges, and most experienced family law layers, would say that the worst place you can put a child is on a witness stand in a courtroom where that child is forced to testify right in front of mom and dad. The potential for emotional damage is overwhelming and we really want to protect kids from that.
When kids are meeting with a mediator, it’s in a one-on-one private meeting. Mom isn’t listening in. Dad isn’t listening in. Neither parent is scrutinizing the situation. Under our rules of evidence and given the fact that parties have the right to cross-examine witnesses, you don’t enjoy those protections in a courtroom. That’s why we’re all very, very reticent to put a child on a witness stand. There are laws that allow it to happen, but those laws are very rarely applied because we are all trying to protect the children and do what’s best for the children. And forcing them to testify against their parents is rarely what’s best for the kids.
And what happens in a case, John, where the spouse who is supposed to be paying child support isn’t paying it? Is there a remedy for the spouse who is supposed to be receiving child support?
Harding: Yes, we have several options in California. If a parent is not paying child support, we always have the opportunity to file a contempt of court action.
If there is a valid and enforceable court order for child support and that court order is not being complied with, then, in theory, that non-compliant spouse is in contempt of court. We can file a contempt action, take that non-paying parent back to court, and if we successfully prove to the court that that child support order is not being complied with, then that non-compliant spouse can be subject to severe penalties—first and foremost being jail time.
There are other, less severe measures that we can resort to in California to get child support orders satisfied. We have a government agency called the Department of Child Support Services (DCSS). If you are a parent who is receiving child support, or the parent who is paying it, for that matter, you can register your court order with the DCSS and they will then set up a computerized invoicing system so that a bill is sent to the payer spouse each month as a reminder. Then a system can be set up so the payments are sent straight to the DCSS for forwarding to the recipient spouse.
The DCSS also has enforcement tools available to assist the recipient spouse in getting his or her support, like the ability to freeze a driver’s license as pressure to compel that supporting parent to make the payments. They can also freeze contractor’s licenses or seize tax refunds.
Another tool that is available to the DCSS, to me as a family law attorney, and to a recipient parent in a family law system is what is called in income withholding order for support. It’s a simple document that gets issued by the family law judge and is served on the employer of the spouse who is obligated to pay child support. Then that employer has its own independent duty to withhold the child support from the employee’s paycheque, and to forward that child support payment to the recipient parent. So, there are myriad tools and processes by which we can enforce the payment of child support in California. For the most part, they usually are pretty effective.
John, I want to give you a moment to highlight–and I know you exclusively focused your practice on family law, but can you tell me if there is anything that you do different in your practice than what you think other family lawyers are doing in Northern California, or maybe California, period?
Harding: There are some unique things we do at Harding & Associates Dan.
California is a huge state. It has a very, very complicated legal system. There are thousands of divorces that are filed up and down the state every year. One of the ways that we are better able to represent our clients is by limiting the geographical area that we practice in. We only take cases in three Northern California counties: Alameda Country, Contra Costa County, and Santa Clara County. By focusing the scope of our practice to those three counties, we feel that we are more in tune with the family law courts in those counties. We are better able to predict what the judges are going to do in family law cases in those counties. And we are able to provide a more intimate knowledge of family law practice and family law courts for our clients than if we were practicing up and down the entirety of a state as huge as California. So, we
think that is a unique element of our practice by which we are able to deliver superior legal representation to our clients.
Another area that we have pioneered is in the utilization of technology in our family law practice. For our listeners, I would just let them know you and I are both very, very tech savvy, and one of the ways that I came to know Dan Couvrette is through our mutual love of technology in the work that we do. And, as an early adopter of technology in family law lawyering, we really did pioneer the use of technology in our practice. Everything that we do is digitized and/or computer-based. Through the utilization of these technologies we are able to provide our clients with better, more efficient, more thorough, and more timely representation, all for the benefit of the client.