Temporary orders concerning custody and support are typically obtained at or near the inception of a family law case. As temporary orders often remain in place during the pendency of a case, their importance should not be underestimated. Temporary orders play a particularly critical role in custody disputes because they can impact the “status quo” which existed prior to the filing of a Complaint for Divorce. For example, a parent who spends increased time with a child pursuant to a temporary order may then be able to demonstrate at the time of trial that he/she is prepared to parent the child with such an increased time-share on a permanent basis. For that reason, it is important to prepare a motion with supporting affidavits or a detailed opposition with competing claims for relief in order to provide the court with the admissible evidence it needs to make a sound decision in setting support or determining custody on a pendente lite basis.
IMPOUNDING A DIVORCE FILE
The cases filed in the Probate and Family Court, and the documents they contain, are open to public inspection. The court, however, has the authority to impound a file, or selected documents in it, pursuant to the Massachusetts Trial Court Rule VIII, Uniform Rules on Impoundment Procedure.
The Uniform Rules on Impoundment Procedure (URIP) govern impoundment of otherwise public case records that are filed in civil and criminal proceedings in each Department of the Trial Court. Case records are presumed to be open to the public, unless they are impounded or sealed as a matter of law, or impounded by a court order.
Trial Court Rule I.
When a file, or a portion of it, is impounded, the impounded documents are kept separate from the open file and are unavailable for public inspection. The only individuals who can view impounded documents are the court, clerk, authorized court personnel, attorneys of record and the parties to the case, unless otherwise ordered.
In order to impound a file, the court must find that good cause exists.
In determining good cause, the court shall consider all relevant factors, including, but not limited to, (i) the nature of the parties and the controversy, (ii) the type of information and the privacy interests involved, (iii) the extent of community interest, (iv) constitutional rights, and (v) the reason(s) for the request. Agreement of all parties, interested nonparties, or other persons in favor of impoundment shall not, in itself, be sufficient to constitute good cause.
Trial Court Rule 7.
Orders of impoundment are not common. When they are issued, they are narrowly tailored, encompassing only those documents for which good cause to impound has been demonstrated.
Are premarital assets subject to division at the time of divorce?
You started a company, grew it, and sold it. You took the substantial proceeds of sale and invested them. Then you fell in love. You got married. Now you’re getting divorced. Your soon-to-be ex says he/she is going to take it all – or at least half. Is that possible?
In Massachusetts, the court may assign to one party in a divorce proceeding all or part of the assets of the other acquired prior to marriage. “In addition to or in lieu of a judgment to pay alimony, the court may assign to either husband or wife all or any part of the estate of the other …” Massachusetts General Laws Chapter 208, Section 34. The term “estate” encompasses all property to which a party holds title, whenever and however acquired, and includes property obtained by a party before marriage.
Whether the court will divide premarital assets, or their appreciation in value during the marriage, is dependent on the facts of the case, including the length of marriage, the parties’ respective contributions to the marital partnership, whether a spouse contributed economically or non-economically to the asset, and the parties’ ability to obtain future income and assets, among other factors.
So, yes, the claim can legitimately be made but whether it will be successful is dependent on the parties’ circumstances and, as always, the arguments made in court.
Inheritances and the division of the marital estate
On Monday, you inherit a million dollars. On Tuesday, your spouse files and serves a Complaint for Divorce. Do you get to keep the million dollars?
In Massachusetts, the court has broad discretion in determining which assets belong to the marital estate and how they should be divided. Neither the date of acquisition nor the manner in which title is held necessarily determines whether an asset is to be included in the estate. Rather, the concept of marital property in Massachusetts, as defined by statute as well as applicable case law, is expansive. “Upon divorce … the court may assign to either husband or wife all or any part of the estate of the other …” Massachusetts General Laws, Chapter 208, Section 34.
In dividing the marital estate, the court is required to consider various factors: “… the length of the marriage, the conduct of the parties during the marriage, the age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities and needs of each of the parties, the opportunity of each for future acquisition of capital assets and income, and the amount and duration of alimony, if any. …” Massachusetts General Laws, Chapter 208, Section 34. While a mere expectancy under a will may be considered by the court as an opportunity for future acquisition of capital assets and income, a vested inheritance may be assigned upon divorce.
So, would the million dollars be included in the marital estate? Most likely, yes. Would you be allowed to keep it? Arguments could be made for both sides depending on the facts: For example, did you receive the inheritance after six months of marriage or after 20 years? Does your spouse expect to receive a substantial inheritance? Did you or your spouse incur debt in reliance on the anticipated inheritance? Did you participate in any activities for which you were not adequately compensated or due to which you lost opportunities (to the detriment of the marital estate) and, as a result, received the lump sum inheritance? Is your spouse financially self-sufficient? When did you separate – five years prior to your receipt of the inheritance or on the day you were served? Did you and your spouse rely on an income stream generated by the million dollars or access the principal? Presumably not since the inheritance was received twenty-four hours prior to the filing.
The answers to these questions do not necessarily resolve the issue in dispute, nor is any one determinative, but they may form the building blocks of an argument. An equitable division of the marital estate is the objective of the Probate and Family Court and, taking into account the parties’ facts and circumstances, the court will endeavor to do just that.
Bank Alert Notice: Residential Foreclosure
Another impediment related to residential foreclosure
Following a foreclosure, we all have been faced with the prospect of evicting the homeowner who becomes as we all thought, a tenant-at-will. The general rule was to provide a 30-day notice of termination of tenancy and then to begin a summary process hearing to evict the post-foreclosure “tenant” from the property.
A case which was just decided from the Southeastern Housing Court found that based upon the fact that there is no agreement between the homeowner and the lender as to its post-foreclosure tenancy status, that the 90-day notice period provided in the eviction statute applies for the purposes of the Notice to Quit for possession.
As you know, each case is fact specific and the court made clear that under these facts, a 30-day notice to quit was insufficient.
We think that this topic will start to appear more frequently as debtors continue to look for more creative ways to delay the inevitable. Some lenders are simply offering a cash payment following a foreclosure in exchange for keys.
Creditor protection of the assets of an IRA
The general rule is that an IRA which you created or inherited from your spouse is 100% protected from creditors in bankruptcy or general creditors. If, however, you inherit an IRA from a third party,then based upon a recent Supreme Court decision, the proceeds from that IRA are no longer protected from creditors of your bankruptcy. A suggested way around this problem would have been for the owner of the IRA to create a spendthrift trust and leave the proceeds of the IRA to that trust. If you inherit an IRA and have creditors you should meet with an attorney.
Paying your divorce attorney
Many people do not seek legal representation in their divorce case in fear of their inability to pay attorney fees.
Whether you are the plaintiff or the defendant in a divorce case, the probate and family court can order one spouse to pay a retainer fee for an attorney for the other spouse. The plaintiff or defendant must prove to the court that he or she does not have enough money to pay the retainer for an attorney and the other spouse has enough income or assets to pay for the retainer. The court will look at the financial statements of both parties to determine if it should order one party to pay the other parties legal fees.
Withdrawals from an IRA
By law, you are required to take minimum required distributions when you attain age 70 ½ from an IRA which you created or which your spouse created.
In the event that you inherit an IRA from a third party, other than your spouse, then you will be required to take minimum distributions beginning the year after the IRA’s creator died. The amount varies depending on the beneficiary’s age. If you fail to take the required minimum distribution, then you will incur a 50% penalty and income which you fail to take will be included in your federal and state income for the year in question. An exception to the rule is that if the creator died before attaining age 70 ½ then you will incur no penalty if you take all of the funds within five years after the creator’s death.
Annulment
Despite popular belief a couple cannot get an annulment because their marriage was short. To get an annulment, a party must prove that the marriage is “void” or “voidable”.
Your marriage is void if, one of the parties is already married to someone else or you married a close relative or close relative by marriage. A marriage is voidable if: for example, one of the spouses did not have the mental capacity to consent to the marriage at the time or one of the spouses was not old enough to get married. If one spouse has requested an annulment because the marriage is voidable, and the other spouse does not want their marriage annulled, he/she can request to affirm the marriage.
Bank Alert Notice: Right of Setoff
We recently reviewed a situation where a bank set off on a customer’s deposit account, following an event of default. The customer claimed that that bank did so wrongfully.
We all understand that the relationship between the bank and its customer with respect to the common law right of setoff is that of creditor (the “Depositor”) and debtor (the “Bank”). Once deposited, the money is then the property of the Bank subject to the customer’s right to retake such property. The Bank of course has a right of setoff, which allows it to exercise such right and seek redress of a claim in full or partial satisfaction of what it owes to the Depositor.
In exercising the right of setoff, there must be mutuality of obligations, which means that the Bank can only exercise such right against the Depositor in the same capacity that the Depositor owes money to the Bank. Moreover, the Depositor’s obligation to the Bank must be due. Certain deposits, such as a payroll account or other trust account will generally not be subject to set off. Furthermore, Chapter 167D of the Massachusetts General Laws imposes a requirement that state chartered banks notify a Depositor immediately following a set off by written notice, sent first class mail to their last known address. The failure to do so could jeopardize its set off.
Lastly, it is critically important that you review the Bank’s loan documents prior to the exercise of the right of setoff. In this case, the prior loan officer who negotiated the transaction documents, allowed the borrower’s counsel to modify the right of set off to make it subject to the Bank’s liquidation of “all collateral” securing the loan (“Marshalling Clause”). As such, the right of set off should not have been exercised until the collateral was liquidated.
Equally problematic was the way that the Marshalling Clause was written. This will be further explained next month.
John W. Davis is a graduate of Hamilton College (B.A., 1979) and Emory University School of Law (J.D., 1982) where he was a member of the Board of Editors for the Emory Law Journal.
Peter W. Shrair has held the position of Managing Principal at Cooley, Shrair P.C. since 2008. A 1983 graduate of Hobart College, Peter graduated with honors from the Boston University School of Law as an Edward F. Hennessey scholar in 1986 and later earned a Masters Degree in Taxation from the 
Leonardo Shrair
Motzart Shrair, a 90-pound Golden Doodle, was born on September 4, 2007, in Missoula, Montana and was appointed mascot of Cooley, Shrair P.C. shortly after relocating to Springfield. Since that time, he has been a fixture in the law firm. Motzart has developed a long list of loyal clients who often come to visit him to scratch him behind his ears or rub his belly. Motzart is especially fond of attending contract negotiations and he is happy to assist with the cleaning of a conference room if food drops during a meeting. He is full of life, love and can help take the edge off of many difficult situations.
David A. Shrair joined the firm of Cooley and Cooley in 1960, after graduating with honors from Boston University School of Law; where among other successful scholastic accomplishments, he was a Senior Editor of the Boston University Law Review. In 1978, David became Managing Principal of the firm, a position he held for the next 30 years. In 1991, the firm transitioned to its current name, Cooley, Shrair P.C.
Robert L. Dambrov is a 1969 graduate of the University of Massachusetts and a 1972 graduate of Boston College Law School.
Dawn D. McDonald, partner with Cooley Shrair, graduated from Westfield State College with a Bachelor of Science in Business Management in 1991. In May of 2000, she received her Juris Doctor from Western New England College School of Law. Attorney McDonald was admitted to the Bar of the Commonwealth of Massachusetts in January 2001; to the Bar of the State of Connecticut in May 2001; to the United States District Court of Massachusetts in February 2001; to the United States District Court of Connecticut in November 2002; and to the First Circuit Court of Appeals, June 2004. She is a member of the Litigation and Employment Law Sections of the Massachusetts Bar Association and a member of the Hampden County Bar Association.
Susan A. McCoy, partner with Cooley Shrair, manages our Estate Planning department. An Agawam native, Susan brings a diverse background of legal experience assisting clients with their personal and business planning.
Rona S. Fingold is a 1973 Boston University graduate and a 1978 graduate of Boston University School of Law. In addition, Rona received a Master of Science in Taxation from the Boston University Graduate School of Tax program in 1983. Rona, formerly a tax partner at Cooley Shrair, is now Of Counsel, providing valuable estate and tax planning advice and consultation for our clients from her home in Florida. Rona’s areas of focus for more than 25 years have been general tax, estate planning and tax exempt organizations.