Last week, I blogged about the Information Asymmetry and how important it is for you to educate yourself going in to the divorce process so that you can meaningfully assist your attorney with your case.  But what about your attorney? And what about your Judge?  Isn’t it important for them to also be as informed as possible during the course of your case?

That is where experts come in.

ID-10095105 (Photo courtesy of freedigitalphotos.net.)

In divorce cases, there are oftentimes issues that arise that require the input of an expert.  For example, perhaps there is a dispute as to how much money your spouse is able to earn, how much his or her business is worth, or which one of you would be better to assume custody of the children.

Experts can assist your attorney present your case, and it can greatly assist the Court in deciding the case in your favor.  In fact, so important may an expert be in your situation that a Court may take it upon itself to appoint one on your behalf.

Below are the most common types of experts that you should consider when moving forward with your divorce, if appropriate given the facts and circumstances of your case:

1.         Vocational Expert:  This will tell the Court whether one spouse is underemployed and whether he or she is capable of making more money.  This expert will be important for the issue of support, which in New Jersey, is awarded in accordance with your earning capacity rather than your current income.  Also, if you or your spouse has been absent from the workforce for a period of time, a vocational expert will assist the Court in determining how realistic it will be to obtain employment consistent with prior earnings.

2.         Real Estate Appraiser:  If there is a dispute as to the value the marital home – which is typically the largest marital asset – or other property, such as a vacation home, second home, timeshare, etc., a real estate appraiser will be key.  This expert will assign a value to the property so that the equity can be appropriately divided.  He or she will also provide a detailed report outlining comparable sales prices for similar properties in your neighborhood, any improvements to your home which increase its value and make it unique, and an explanation of how the value of the property was decided. If this issue is not too hotly contested, it is typical to use a joint appraiser – that is, the parties will share the expert and the cost, subject, of course, to each party’s right to obtain a second opinion.

3.         Forensic Accountant:  A forensic accountant will take that mess of documents – bank statements, credit card bills, canceled checks – from your filing cabinet and turn it into a report that will tell your attorney and the Court about your marital income, assets, liabilities and expenses.  In short, this is the key document that will elucidate what your marital lifestyle was.  This will be important for the issue of alimony – which, in New Jersey, is awarded based in large part upon the lifestyle of the marriage – and equitable distribution.

4.         Business Valuator:  If one spouse has an interest in a business, it will be important to understand its value for equitable distribution purposes.  This does not only apply to commercial businesses.  It also applies to doctors’ practices, law firms and accounting firms.

5.         Custody Evaluator:  If custody is contested in a divorce, a custody evaluator will almost always be necessary.  The custody evaluator will make a recommendation, usually contained in a lengthy report, as to which parent is better suited to assume custody of the children following a divorce.  We often see cases with three custody experts: a joint or court appointed expert, the father’s expert and the mother’s expert – all with differing opinions.  It is therefore important to choose an expert that is highly qualified, well-respected in his or her field, and will command the attention of the Court.

Experts are not only helpful if your case goes to trial.  They are also helpful in settling your case.  For instance, if one party receives a favorable report, it may be used as a tool to obtain a advantageous settlement.  The opposite is also true.  If a party receives a report that is not as favorable, he or she may be more apt to settle the case rather than proceed to a hearing.

In sum, it is important not to underestimate the importance of experts when it comes to divorce.  They can be a great tool in settlement and a great asset on the stand.

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Eliana T. Baer is a frequent contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

What do divorce and economics have in common?  Well, a lot. But today I am focusing on the unlikely link between the theory of information asymmetry – which deals with the study of decisions in transactions where one party has more or better information than the other – and the New Jersey Divorce App.

Smartphone Info  (photo courtesy of freedigitalphotos.net)

According to the acclaimed book, Freakonomics, the theory of information asymmetry accounts for why we hire a real estate to sell our house, an insurance broker to purchase long-term health insurance, and a funeral director to purchase a coffin for a loved one that has passed.

So what does the information asymmetry have to do with divorce, you ask?  Well, typically, when getting divorce, you hire an expert – a divorce lawyer – to handle your case.  After all, we are well-versed on all things divorce, custody, alimony, child support, equitable distribution, tax issues, and many other issues with which you may not be familiar.

In other words, the divorce lawyer has an information asymmetry that the client seeks to tap into to achieve the best result possible.

But what if you could bridge the gap between the lawyer’s vast knowledge and your own?  Would you achieve a better result if you could actively participate in the process?

Possibly.

Just like studying up on the housing market may assist the person selling or buying their house when working with a real estate agent, having more information as a litigant during the divorce process may help you inform your attorney as to the issues in your case.

That is where the New Jersey Divorce App can help tremendously.  It is designed specifically for the client.  It takes information regarding the divorce process, synthesizes it, and presents it to the client in a way that they can easily understand.

For example, when you download the app, you will see a section called “Divorce Information,” which covers the following topics:

  • Overview of the Divorce Process;
  • Custody;
  • Child Support;
  • Alimony; and
  • Equitable Distribution.

Click on these larger topic headings, and you will get to a myriad of subtopics; many of which will pertain to your specific case.  This section is a great compliment to the Finance Tracker and Asset Identifier, which allow you to interface with your attorney like never before.

So just like you would not buy or sell a house without doing a little research, don’t go into your divorce without making that information asymmetry a little less asymmetrical.

For more information and to download the New Jersey Divorce App, click here.

______________________________________________________________________________ Eliana T. Baer is a frequent contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

Today, I am highlighting another feature of our New Jersey Divorce App, the Asset Identifier.  While the “Finance Tracker” gives you the ability to input your more commonly identifiable assets such as your house, car, boat, bank accounts, the Asset Identifier does something a little bit different.

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It is important when considering what each party will get in a divorce, to identify all of your assetS. This will guarantee you address all assets when dealing with settlement as well as monthly support payments.  However, many people with oftentimes overlook some less than obvious assets.

With the Asset Identifier, you have the ability to go through a list of assets that some people do not even realize should be divided in equitable distribution.  Eric Solotoff expounded further on what this may include in his February 2008 blog post – Hidden/Forgotten Assets.

For example, did you know that the following could be considered assets subject to equitable distribution in your divorce:

  • Frequent flyer mileage
  • Timeshare property
  • Country club memberships
  • Unused vacation or sick leave
  • Many, many more…

The Asset Identifier provides you with a full list of items that you may not have even considered in checklist form.  Once completed, you can then send it right off to your attorney so that he/she can make sure they are negotiating a complete and comprehensive settlement on your behalf.

For more information and to download the New Jersey Divorce App, click here.

______________________________________________________________________________ Eliana T. Baer is a frequent contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

Recently I lost a dear client and friend, Bill*, after his long battle with brain cancer.  Bill was a man with a kind-hearted spirit and a gentle disposition – one of those “really nice guys” that you just wanted to bend over backwards to help.

While Bill was fortunate enough to spend his last days with his loving wife, surrounded by her family, he also had the misfortune of spending his last days in a dispute with his former wife, who was still collecting alimony from him, garnished from his Social Security Disability Payments.

A while back, I posted Alimony Modification – A Judge’s Checklist.  Bill had each and every box checked off – there was no doubt that his income was reduced, his former wife’s income had increased exponentially, and it was undisputed that he was disabled permanently and involuntarily.

ID-10026029 (Image from freedigitalphotos.net)

We attempted to get the judge to see that Bill could no longer handle his alimony payments from his meager income and that his alimony should be terminated summarily – that is, without a hearing.  After all, according to the seminal alimony modification case in New Jersey, Lepis v. Lepis, the Court need not hold a hearing on every single modification case when there are no facts in dispute, which was the case here.

Nonetheless, the court insisted that a hearing be held. This is an interesting contrast to the cases where judges refuse to hold hearings when denying motions outright which I blogged about previously – Motions to Reduce Support: When Applications Are Denied Without a Plenary Hearing, What’s Next?

However, Bill was too weak and too sick to move forward.  He was dying of brain cancer.  Our only option was mediation.

We settled the case shortly prior to Bill’s passing.  He was able to pass with the knowledge that there would be no litigation for his wife to bear following his death and that the case was behind him.

Because the case was settled, it will never be a published decision, it will not be analyzed by family law experts and it will not be bound in the annals of case law in our State.  But it still begs the question: if this factual scenario did not warrant the termination of support without a hearing, what factual scenario does?

*Name has been changed to protect client confidence.

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Eliana T. Baer is a frequent contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

Oftentimes I hear from clients that gathering their financial information is the most daunting task they will face during the divorce process. They picture being buried in an avalanche of documents, account numbers and canceled checks.

The New Jersey Divorce App’s Finance Tracker can help.  In fact, I have recommended it to my clients before, with great results.

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The Finance Tracker is designed to help you focus in on the necessary information that you will need throughout the divorce process.

It is split up into 4 categories:

Income

Assets – like your house, car, bank accounts, retirement accounts, etc.

Expenses

Liabilities

Each section is then split into subcategories, which allows you to categorize the information in a way that makes sense.

Here is the best part: you can send the information directly to your attorney – straight from the app!

While the divorce process can be overwhelming at times, the New Jersey Divorce App, along with its Finance Tracker and other great features make things a little bit more manageable.

For more information and to download the New Jersey Divorce App, click here.

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Eliana T. Baer is a frequent contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

I came across several news outlets yesterday running a story about the “Divorce Fairy”, otherwise nicknamed the “Divorce Fixer” or the “Robin Hood for divorcing women”.  The story discussed a particular divorce finance firm located in Manhattan, which loans money to divorce litigants typically in the New York/New Jersey area, so that the litigant can purportedly fund his or her lifestyle, as well as litigation expenses, during what may be a lengthy and acrimonious proceeding.

The article went on to detail that a typical loan is approximately $250,000, at an interest rate of anywhere between 12-20 percent, where personal income and credit scores are not taken into account.  In determining whether to loan money, the firm evaluates the marital asset pool to determine the likelihood of the loan being repaid at the matter’s conclusion.  Considering that the typical loan is a quarter of a million dollars, the services provided are not going to be compatible with all matters or for all individuals.

As a threshold consideration, is such a service necessary?  On the one hand, it seems like a great idea, especially for spouses who had no control over the assets during the marriage and do not know how they are going to pay for a retainer, let alone the costs of an entire proceeding.  I recently had a potential client indicate that she wanted to retain our firm, but could not afford to pay a cent of a retainer – no credit card, no account access, no borrowing ability from family, friends, or a financial institution.  The other party had hired a very aggressive attorney and filed a Complaint for Divorce containing no less than eight (8) counts, and a motion to dismiss some of the counts was likely going to have to be filed at the outset.  In that case, considering the assets involved that would be available to repay a loan, she sounded like a good client for the services provided by a divorce financing firm.

Similarly, we recently represented a client who sought an amount of monthly interim support commensurate with that lived during the marriage.  The problem was, however, that she had no idea what the marital lifestyle was because the husband earned the income, controlled the assets, and paid the expenses.  This is not an unheard of scneario, but the trial judge took issue with the litigant’s inability to quantify the marital lifestyle, despite the husband earning upwards of $1 million annually.  Under these circumstances, being able to procure a loan from the financing firm would, perhaps, have eased her concerns about funding her monthly expenses and allowed her to litigate against a spouse with a bottomless war chest.

On the other hand, some would argue that such a service not only serves to unnecessarily drag out a litigation, but also circumvents many of the more standard avenues available to a payee spouse to ensure that her lifestyle is maintained during the divorce, and that she receives a counsel fee payment to “level the playing field” with the monied spouse.  This way, the monied spouse cannot financially intimidate the other spouse into an inequitable settlement or result.  When a motion to procure such relief is available where the monied spouse may be directed to pay interim support and fees from his income, rather than marital assets under his control, one can argue that it does not make sense for the non-monied spouse to incur such a substantial obligation to a creditor, with what some may consider to be a very high interest rate attached thereto (which is not surprising since credit scores and income levels are not considered).

It comes down to a cost-benefit analysis.  When a case finally reaches its conclusion, how does the non-monied spouse determine whether it was worth procuring the loan and its accompanying interest rate, rather than having filed a motion with the trial judge for interim financial relief, which would not carry the same debt obligation.  In addition, while evaluating an asset pool to determine if a loan can be repaid makes sense, oftentimes the asset pool available at the commencement of a matter is different from that at the end of the matter, for a variety of reasons including but not limited to, passive market forces.  While there are many cases where the loan can be repaid without difficulty, instances may arise where the non-monied spouse cannot repay the debt at a matter’s conclusion.  In the course of negotiating, the debtor spouse can ask that the monied spouse pay off the loan and any potential interest, or at least a part thereof, which is certainly that litigant’s right to request pursuant to various rules and cases applicable to support and counsel fee awards.

Ultimately, the divorce finance service is a very interesting and developing concept.  While it does not seem to be appropriate for every case or client, any litigant considering such an option should not only consider the debt obligation that will accrue in connection with such a service, but also how it measures in comparison to your rights as a divorce litigant, and other avenues of potential relief, such as the motion practice outlined above.  Be sure to discuss all such options with experienced matrimonial counsel before making this type of decision in connection with your divorce proceeding.

 

We don’t typically post about DYFS (now DCPP) or similar type cases on this blog as we usually focus on divorce and related issues. That said, for fun, I was reading the new cases that were decided yesterday and came upon a case that I found compelling, both because it indicated some systemic problems in custody cases and because it had some real strong language about parental rights – that while stating the obvious, perhaps, did so in a powerful way and in a way that needed to be reiterated. 

The case I’m talking about is  C.D., A.P. and D.D. v. N.D.M.  and A.L.   which was an unreported (non-precedential) decision released by the Appellate Division on January 8, 2013.  In that case, the aunt and grandparents received temporary custody of her niece and a best interest evaluation, to be completed within 90 days, was ordered.  The parties ultimately agreed to a joint expert to do the evaluation,  That evaluation, which by court order was to be completed in 90 days, took more than a year to complete.

SYSTEMIC ISSUE #1:  All custody and best interest evaluations are supposed to take 90 days or so.  That almost never happens.  Rather, it is not unusual for it to take 6 months or longer to get a report.  If it is a joint or court appointed expert, the party who doesn’t like the report has the right to get their own report so add another several months to the process.  As in this case, where the mother’s custody with her own child hinged upon this report, the prejudice cannot be quantified.

Continue Reading Getting Temporary Custody of a Relative Does Not Make You the Psychological Parent

An interesting issue was recently considered by the Court in the case of Muller v. Muller. Specifically, the Appellate Division examined whether a husband could compel the sale of the marital home when he had conveyed his interest by way of deed about ten years earlier, but the parties’ Property Settlement Agreement (“PSA”) had provided for the husband’s continued ownership.

The parties in Muller were married for 17 years. When they divorced in 1990, they entered into a PSA, which, in part, provided as follows:

EQUITABLE DISTRIBUTION
A. Husband and Wife agree to divide equally the personalty . . . upon sale of the premises or child’s emancipation, whichever shall first occur.
B. Upon execution of contract of sale of the above premises, Husband agrees to put his interest in the marital home in trust for Child.
. . . .

REAL ESTATE
A. Husband agrees to pay the mortgage payments [on the marital home] . . . until the time that child graduates from college, or reaches the age of 22, whichever shall first occur[.]

The husband paid the mortgage from the time of the divorce until around 1999 when he defaulted on the payments. The mortgagee instituted foreclosure proceedings in or around July of 2000. In order to avoid foreclosure, the wife borrowed about $60,000 and refinanced the property. The husband executed a deed and conveyed the wife his ownership interest in the property for consideration of $50,000. As a result, the wife exonerated him of the debt the he had incurred by defaulting on the mortgage payments. At the point, the child was 21 years old and had graduated from college.

Continue Reading Did a Property Transfer Occur? Husband Could not Rely on the Property Settlement Agreement to Compel the Sale of the Marital Home Because the Deed Controlled.

Oftentimes, a less economically able party is faced with a spouse or former spouse who insists on litigating time and again simply because they can, hoping that the “war of attrition” will force the other party to give them what they want to avoid further motion practice.  We as family practitioners know that while the Rules of Court provide a party with the ability to seek a counsel fee award from the other party for a variety of reasons including, but not limited to, “evening the financial playing field,” assisting a party in need where the other party has the ability to pay, or, commonly, addressing the other party’s unreasonable behavior, courts do not always award fees even in what may seem like an obvious situation to do so.

For example, a party bringing a motion to enforce litigant’s rights may not receive an award of fees even if they tried to settle to no avail before filing the motion, especially where the other party “remedies” the issues before the Court actually decides the motion.  Of course, the motion would not have been filed had the other party earlier complied, but the effort to render issues “moot” after the motion is filed oftentimes sways a court not to award fees even though it was the motion itself that compelled compliance.

I recently dealt with the “war of attrition” litigant, who has filed the same motion against our client time and again – literally, the same motion each and every year post-divorce.  In each of the three years since the divorce, he was denied his requested relief in three separate motions.  As sure as the sky is blue, the former spouse again filed a motion this year – his fourth – for the very same type of relief as to parenting time.  Notably, the former spouse also retains a different attorney for each motion in an effort to cleanse the court’s palette.  In two of the three prior denials of his requested relief, he was Ordered to pay our client substantial counsel fees since he makes six times the annual income of our client, and his repeated efforts to financially pressure our client into getting what he wants have proven transparent in the eyes of the court.

On this fourth occasion, the story was the same and, thankfully the result – a denial of the former spouse’s requested relief and an award of full counsel fees for our client.  While the immediate result was positive, as it has been after each prior motion, I have no doubt that the former husband will again file a motion for the very same relief in 2012, 2013 and beyond until the child is emancipated upon whom the requested relief was based.  While one can only hope that our client will continue to successfully fend off his attacks, the more unfortunate problem is that she cannot stop him from filing his motions.  In fact, when he was denied time around, he verbally questioned the judge, incredulous that he would be denied again despite the lengthy history of denials and him being found to have not only acted unreasonably, but in bad faith, as to his litigation tactics.  It was this response that only further confirmed that we will be back in court next year, starting anew the annual litigation cycle that not only leaves our client financially drained, but also causes great emotional strain upon her and her family that cannot be remedied by a mere award of counsel fees.

I have recently blogged about the need for courts to award counsel fees when a party successfully enforces an agreement or an Order.  As noted, all too often, court’s do not award counsel fees, or when then do, the award is not the entire amount of fees incurred.  This potentially empowers to wrong doer because there is no ramifications to their non-compliance.

That issue arose in the unreported (non-precedential) opinion in the case of Bello v. Bello decided on April 1, 2011.  After the parties’ divorce, the wife was forced to file 5 post-judgment enforcement applications.  She was successful and was awarded fees for each.  However, at the fifth motion, she was only awarded $1000 because the trial judge "stated that "I don’t want to cut off support for the [wife] in favor of counsel fees."  The wife unsuccessfully sought reconsideration contending that the amount was too low given the husband’s lavish lifestyle and significant assets.  She then appealed.

The Appellate Division reversed and remanded the matter back to the trial court to determine the proper amount holding:

After carefully considering the entire record, we conclude that the judge’s reasoning for limiting counsel fees to $1000 contradicted his finding that the husband had a substantial income and several assets. The husband lives in a home worth $1,000,000 with a tennis court and swimming pool, drives a 2007 Mercedes sedan, owns two other cars, pays $1500 per month for his mortgage, is the sole proprietor of Mendham Eyecare business, earns more than $200,0001 a year, and refused to pay his child support and alimony obligations. In addition to finding that the husband had "plenty of resources to pay his obligations," the judge found that a review of the husband’s case information statement demonstrated "at least $14,000 of excess [money available]."

We therefore reverse because the judge’s finding that the husband cannot afford a fee greater than $1000 is "manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence."

Perhaps this decision will be a deterrent and ensure future compliance.