Olympian learns she’s about to be divorced on Twitter

It isn’t unusual for couples considering divorce to physically separate while they sort out their feelings.

It is a little unusual, however, to talk about your impending divorce on Twitter before you’ve bothered to tell your spouse that you’ve decide to proceed.

That’s the unpleasant way that Olympian figure skater Michelle Kwan found out that her husband of four years had decided to go ahead with a divorce. After reading the tweet, she found an article online where her spouse announced that he’d filed for divorce in California, the state where he’s currently living.

Kwan is currently living in their home in Rhode Island and would prefer that the divorce case be handled by that state’s court. She’s attempted to serve her spouse with the Rhode Island divorce complaint 10 times — indicating that he must be going to great lengths to avoid being served.

Likely, his reluctance to be located has to do with his preference for California’s court system. When couples separate prior to divorcing and move into different states, jurisdictional disputes can be a problem. Not every state follows the same rules in a divorce, and it’s likely that Kwan’s husband prefers California’s marital property laws over those in Rhode Island.

California considers everything acquired after a marriage to be community property — and the general rule for dividing it up is “share and share alike.” In the majority of cases, community property is divided equally between the divorcing spouses regardless of factors like who contributed most to the marital assets.

Rhode Island, by comparison, has a much more complicated process for the division of marital property known as equitable distribution. Equitable distribution takes an approach that is best described as “fair but not necessarily equal.” When dividing up the marital assets, the judge is free to consider not only the contributions of each spouse toward the marital assets but a host of other factors. Some of the things considered are the length of the marriage, each spouse’s conduct within the marriage, the occupation of each spouse and his or her relative earning capacity.

Jurisdictional disputes in a divorce can quickly become complicated issues. If you suspect that you may have a jurisdictional issue with your spouse sometime soon, talk to an attorney today.

Source: Vanity Fair, “Michelle Kwan's Divorce Kicked Off with an Unpleasant Surprise,” Hilary Weaver, May 11, 2017

Fiduciary Duties of Managing Community Property: What a Managing Spouse Must Know

by Indy Colbath

Under California law, spouses owe each other certain duties both during the marriage, and after separation before the property is divided. These duties are fiduciary in nature, and held to the same standard as those between business partners. Family Code section 721(b) states in pertinent part that: “…This confidential relationship is a fiduciary relationship subject to the same rights and duties of nonmarital business partners…included but not limited to the following: 1. Providing each spouse access at all times to any books kept regarding a transaction for the purposes of inspection and copying; 2. Rendering upon request, true and full information of all things affecting any transaction which concerns the community property. Nothing in this section is intended to impose a duty for either spouse to keep detailed books and records of community property transactions, and 3. Accounting to the spouse, and holding as a trustee, any benefit or profit derived from any transaction by one spouse without the consent of the other spouse which concerns the community property.”

The California Legislature passed this statute with the recognition that married couples commingle finances and place confidence in the other that the financial well-being of the community is being properly managed. Frequently, one spouse is tasked with managing community property, and is oftentimes required to make quick decisions, thus not being afforded the opportunity to have long discussions with the non-manager spouse regarding the potential risks and rewards of a certain financial course of action. This statute was also passed with the recognition that there are some bad actors who amidst divorce would seek to take advantage of the confidential relationship, and purposefully try and defraud their former spouse.

One fiduciary duty imposed upon each spouse by section 721 is the duty of managing community and separate property. (For a crash course on the difference between community and separate property, click here.) The strictest duty applies to a spouse managing the separate property of another spouse, while lesser duties are imposed for the management of the community property, or the manager spouse’s own separate property. This article discusses the law governing the management of community property only.

So what is considered mismanagement of community property under California family law? The seminal case on this issue is Marriage of Duffy, (2001) 91 Cal.App. 4th 926. In this case, the trial court awarded Wife damages of $400,684 due to Husband’s investments of community monies held in an IRA that led to the community sustaining losses. The trial court considered the evidence before it and determined that Wife had asked Husband about investments, and Husband was “dismissive” in his answers. The record also demonstrated that Wife had been aware of Husband’s investments, and even signed purchase agreements. On appeal, the court found that Husband had not violated his fiduciary duties. In reaching this result, the court analyzed the legislative history of enforced duties between spouses, and concluded that the legislative intent was not to impose the “prudent investor rule” upon spouses when managing community property. In other words, spouses owe a duty of loyalty and good faith when managing community property, but do not owe a duty of care.

Family Code section 721 defines the duty owed between spouses as the same as owed between business partners, and specifically references California Corporations code section 16404. Subsection (c) states that “a partner’s duty of care…in the conduct of…partnership business is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct or a knowing violation of the law.”(Emphasis added). The rule in Duffy, Family Code section 721 and California Corporations Code section 16404 enables spouses to make investment decisions in managing community property, so long as the decisions are not grossly negligent, reckless, or knowingly violate the law. Simply losing money in an investment by itself does not amount to a breach of fiduciary duty.

While the law somewhat relieves the managing spouse from the strict application of the prudent investor rule, it’s always a good idea to consult with a family law attorney prior to making any major decisions regarding the management of community property, particularly post-separation and prior to the division of the community assets and debts. The attorney’s advice may vary, depending on the facts of the case.

[It should be noted that the fiduciary duty of management of community assets is dictated by different rules than the fiduciary duty of disclosure. For a discussion of the importance of full and accurate disclosures in divorce, click here.]

The risk of parental abduction: How likely is it?

Sometimes, a parent who is engaged in a volatile and bitter custody battle will momentarily lose all sense of perspective and decide that abducting the child is a wiser course of action than trying to fight about it in court.

What are some of the risk factors that indicate it could happen to you and your child?

If you’re the child’s biological mother, you stand a bigger chance of being victimized this way, statistically, than any other group. Biological mothers abduct their own children only 25 percent of the time. Male parental figures are generally responsible for two out of every three abductions. Biological fathers are behind parental abductions 53 percent of the time, and grandparents are the abductors 14 percent of the time. Other close relatives that have served as caretakers, like step-parents or biological aunts and uncles, account for the remaining 8 percent of abductions.

Most of the time, abductions are impulsive and emotional, rather than carefully planned out. Often, the abductor may be scared that he or she is about to lose all custody or visitation rights, which makes abduction seem like it’s a somehow reasonable course of action — which is probably why the majority of abductions happen right after a court-ordered change in parenting or visitation.

The information we know about parental abduction isn’t all bad, however. For example, it’s important to keep in mind that almost all of the children — 94 percent — who are abducted by a parental figure are eventually returned to their legal custodian. Almost half of those will be returned within the first week after the abduction once tempers cool and reality starts to sink in around the abductor.

If you are concerned about the possibility of a parental abduction because your child’s other parent, grandparent or some other relative has made threats, discuss the situation with your attorney and ask what can be done to limit the possibility until tempers cool down. Sometimes supervised visitation may be in order for a while. For more information on how our law firm may be able to assist you in custody matters, please visit our website.

How to survive a divorce from a narcissist

Narcissistic personality disorder is a real psychological problem that can have devastating emotional effects on the entire family.

Studies indicate that about 8 percent of men and 5 percent of women have narcissistic personality disorder — and it’s a condition that really has no cure (especially because the narcissist is never convinced that he or she has a problem). If you’ve finally decided that you need a divorce, you can just about guarantee that you aren’t going to have an amicable one that’s resolved through something like mediation.

Here are some tips for surviving a divorce from a narcissist:

1. Expect the narcissist to treat the divorce like a stage.

Your divorce is now the biggest dramatic event in history, and the courtroom is just a stage on which the narcissist can perform the dual role of victim and martyr in front of a captive audience. In order to keep the plot engaging, the narcissist will portray you as a miserable low-life and a horrible human being who has been a monster to live with all along.

How do you deal with this?

— The first thing you can do is get into counseling, if you aren’t already.

— Second, remember that just because your spouse is saying these horrible things doesn’t mean that the judge believes what he or she is hearing. Judges are pretty savvy, and they’ve heard it all. Unless your spouse can back up the horror stories with evidence, don’t engage in the drama.

— Finally, try to separate yourself emotionally from the staged show in front of you. The more you think of it as a melodramatic soap opera, the easier it is to disengage yourself.

2. Avoid communication about anything other than necessary issues.

The narcissist is adept at bringing the focus of every conversation back to what he or she really wants to discuss: why you are such a horrible person.

While you may have to communicate in order to discuss settlement offers, division of assets, and (if you have children) visitation times, try to ignore any communications that aren’t on point.

That may mean blatantly ignoring questions, baiting comments and entire emails. Just remember that you have the right to refuse to engage or discuss issues that no longer matter now that you’re divorcing.

For more help with divorce issues, consider talking to an attorney today.

Source: Elite Daily, “Things Your Narcissist Ex Will Do Post-Breakup That Prove You Were Right To End It,” Vishal Sharma, April 09, 2017

Could looming divorce change Zynga’s power structure?

The founder and chairman of Zynga, which is arguably the world’s favorite developer of online social games like Farmville and Words With Friends, is getting a divorce.

Like many people with a lot of assets, he had a prenuptial agreement drawn up before he married his wife. However, his wife is challenging its terms. If she’s successful, that could mean that the man who now owns 70 percent of Zynga’s shareholder vote could eventually lose the tight control he has over the company, since he may have to liquidate some of his holdings in order to divide up his property evenly under California’s law.

It’s important to note that prenups are actually hard to challenge in California. The current court filings haven’t revealed the basis for the challenge, but there are only a few reasons that the court will generally consider:

— The agreement wasn’t properly executed, due to some technical failing.

— The signer was pressured into the agreement. Generally, a prenup has to be presented and signed a significant amount of time before the actual wedding to avoid the appearance of last-minute pressure.

— There are invalid provisions or it heavily favors one spouse over the other to the point of being grossly unfair.

— One spouse lied about his or her finances or withheld information about finances and assets — essentially deceiving the signer from the start.

— The signer didn’t have independent counsel at the time the prenup was signed, which means there was nobody looking out for his or her legal rights.

Challenging a prenup can also be risky — it can cause the challenger to lose any benefits that his or her spouse previously agreed to give in the written agreement.

Experts point out, however, that divorce is never just a family affair when big business is involved. Divorce can shake up a company by changing its major stakeholders, key players, or even impact the strategy and thinking of the person going through the divorce — which could ultimately lead to unwise decisions and risky behavior.

If you’re going through a high-profile divorce that could affect your business holdings, seek legal counsel immediately in order to lessen the impact on both your personal and professional lives.

Source: San Francisco Chronicle, “Divorce may loosen Pincus' grip on Zynga,” Thomas Le, April 05, 2017

Jason Patric wins appeal establishing paternity

Fatherhood isn’t easy, but for some men it’s hard just to win the right to be one.

In California, there is no automatic right to paternity when the parents are unmarried. Legal fatherhood can only be achieved by voluntary acknowledgement or a finding of paternity by the court.

Actor Jason Patric has had to take his case trying to establish legal paternity over the child of an ex-girlfriend that was conceived using in-vitro fertilization (IVF) with his donated sperm all the way to the California court of appeals.

The child’s mother had been in relationship with the actor for several years, during which they unsuccessfully tried to have a child. Even after they broke-up, however, the actor offered to donate his sperm for the IVF procedure, and he and the child’s mother continued to have a tangled romantic relationship until around their son’s second birthday before the custody battle began.

Although the actor had expressed doubts about his ability to be a father even before he donated his sperm, the appeals court ruled that it was his actions after his genetic contribution to the conception that established his paternity. Far from remaining an anonymous sperm donor, Patric had actively participated in his son’s life, and the boy’s mother had both permitted and encouraged that participation.

That was the ultimate deciding factor. The court has a vested interest in maintaining parental relationships where it can, since they give children “social and emotional strength and stability.”

Additionally, a finding of paternity gives the actor full rights and responsibilities over his child. Part of those responsibilities includes child support going back to birth, which the actor did not contest. The child’s mother, however, was not in favor of giving Patric all the rights of fatherhood — namely, visitation or joint custody.

She protested a lower court’s decision to recognize his parentage and give him joint custody based on allegations that he had engaged in domestic violence against her. It’s likely, however, that Patric will be given the opportunity to participate in joint and individual counseling in order to rebut any presumption of domestic violence and gain joint custody of his son.

This sort of case illustrates just how complicated some child custody cases can be. If you need assistance establishing paternity in order to gain custody, talk to an attorney today.

Source: Hollywood Reporter, “Jason Patric Is Legal Parent of IVF-Conceived Child, Appeals Court Rules,” Ashley Cullins, March 16, 2017

Remember to think of divorce as a financial transaction

It doesn’t matter if you have $10 sitting in your bank account or $10 million — the emotional cost of giving up on your marriage is about the same. However, high-asset divorces can be a lot more cumbersome and difficult to get through simply because there’s a lot more worth fighting over.

What’s the best way to get through a high-asset divorce? Start thinking of your divorce as a business transaction — because that’s largely what it is.

Keeping that in mind, realize that you need to do the following:

— Educate yourself.

If you were never heavily involved in the family financial dealings, now is the time to take a crash course and educate yourself about what you and your spouse jointly hold. The more you understand about your family’s personal and business holdings, the more prepared you’ll be to negotiate what you want and recognize a fair (or unfair) settlement when you see it.

— Look for hidden assets.

If artwork, jewelry, coin collections or even cars go missing, you’d probably notice — but your spouse might not count on you noticing unusual transfers out of the joint account for non-existent bills or bogus business “expenses” that are just pretexts used to hide cash while the business is being valued.

— Keep records.

Look for records that not only indicate what money you have, but where it originally came from and what it was used to buy. If you had any assets that were separate from your spouse’s money that you wish to keep, make sure you look for proof of where those assets came from, like wills, trusts, financial statements and insurance policies. Make copies of everything you can so that you and your attorney can use them as a starting point for negotiations.

— Keep future costs in mind.

It won’t do you any good to keep the vacation house in the divorce if you can’t afford the property taxes and upkeep and have to turn around and sell it a year later.

Know when it’s smarter to walk away from something that could just be a drain on your more limited finances post-divorce.

Having an attorney who is familiar with the quirks of a high-asset divorce is important, especially if you’re not used to thinking in purely business-like terms. For more information on how we approach high-asset divorces, please visit our page.