Family Law

Q: What should unmarried couples consider when jointly buying a house?

A: Unmarried couples would be wise to seek independent legal and financial advice prior to the joint purchase of any real estate to avoid later complications should the relationship sour. Unlike couples who divorce, unmarried couples are not afforded an equitable approach, unless they create a specific agreement to do so. The agreement should address proof of each partner’s financial contributions and documentation of each person’s payment of household bills. Also, if parties decide to marry after buying a house, the pre-marital real estate could be partitioned rather than equitably distributed — a lengthy and costly process. Advisors, including real estate agents, accountants, financial planners and legal counsel, should guide the couple to act like practical business partners, negotiating a written agreement prior to settlement on jointly titled property. Getting sound legal advice in advanced will lead to less expense and heartache in the future.
Mark R. Fischer, Jr. and Mary Cushing Doherty, May 2012

Q: The Value of Civility in the Legal Profession.

A: Civility is the cornerstone of the legal profession. Notwithstanding all the attorney jokes that reflect so poorly on members of my profession’s integrity, attorney’s are subject to an extensive body of rules that govern their professional conduct. Clients should not misinterpret an attorney’s civility as weakness. Civility does not require that the attorney sacrifice the client’s interest or not be forceful at the right moments. Many judges and opponents look favorably on the arguments of an attorney with itegreity. You should select an attorney who is a passionate advocate, but one who adheres to ethical obligations. As a profession, attorneys are highly regulated, and all but a few take their ethical obligations quite seriously.
Melissa M. Boyd, February 2012

Q: Why am I getting inquiries about the company’s or my employee’s performance from Support Court after I submitted recent income information?

A: When someone is facing a child support or alimony obligation, “earning capacity” is not the same as income. Support obligations are usually calculated based on each party’s income. If the Court assigns an “earning capacity,” this signals a party should be earning more than what was reported. Given the tough economic times, this term of art should reflect realistic income. Will business records reflect that gross receipts are down or expenses have increased? Has an employee met his/her obligations to contribute to productivity? In a robust economy, a decline in business cash flow or bonuses will be viewed with skepticism. In the current economic climate, the Courts are more likely to accept that market forces, not resentful estranged spouses, are driving down income.
Mary Cushing Doherty, August 2010

Q: At what date is a business valued for divorce?

A: One’s ownership in a business as of date of separation is a marital asset. In Pennsylvania, the divorce Court expects valuation data at separation and close to date of trial. The Court considers the reasons for significant differences in values to decide which valuation date is fair. If the Court finds the owner purposely depleted business assets since separation, or the owner enhanced the value due to post-separation efforts, the date of separation value is the logical choice. If the Court finds the business grew or declined due to market conditions, current value is usually selected. Consider that the buyout of the business interest could be paid over time and the value may plummet post-divorce. The business owner’s attorney should address this at trial.
Mary Cushing Doherty, August 2009

Q: Is a Prenuptial Agreement Right for Your Business?

A: When one or both partners in a marriage are also business owners, it becomes particularly important to have an understanding about how the assets of those businesses will be divided if a divorce occurs. Using a prenuptial agreement to describe and protect a spouse’s accumulated business assets before, during and after marriage will ensure that his or her stake in the business is protected. The content of a prenuptial agreement can vary from a limited agreement that addresses only a specific asset (like a business), to an agreement that addresses all present and future property assets, income, and spousal support both during the marriage and in the event of divorce. If you are considering marriage and have assets to protect, a prenuptial agreement is a wise investment.
Melissa M. Boyd, March 2009

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