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August 3, 2015

Lawyers Misleading Clients - Trying to Predict Outcomes...

As part of my concern about lawyers' advertising, and misrepresenting themselves to clients, I recall an interesting interview with a prospective client a number of years ago.

A client [name and gender sanitized] came to see me, referred from another lawyer [name and gender sanitized]. The spouse had owned a house prior to the marriage and had kept it in his name. Because of pay downs on the loans secured by the property, the community was entitled to some reimbursement. Basically, the pay down of principal [and a few other things] is added back to the community property to be divided, and by a series of formulas known as Moore/Marsden an interest in appreciation is also divided. The rules come generally from two old cases involving the marriages of the Moores, and the Marsdens - for shorthand, we refer to the rules by the names of the cases from which they were derived.

I asked the person a series of questions trying to quantify what her interest might be: How much did your spouse pay for it? What was owed on it when you got married? What is the balance today? What do you think it's worth? And a couple of more.

I then did some quick math and told her my best guess if all the answers were accurate, she would receive something between $30-40,000 in reimbursement for that asset, from an estimated equity of about $300,000.

Her response was "That's not what the other lawyer told me." I hadn't known she was shopping.

I then asked who the other lawyer was: Someone I view as very competent and experienced. So I asked what the lawyer told her about the house. She responded "Well, she said she couldn't tell me what I would get, but that it would be less than $150,000," which would have been half the equity.

I responded "Isn't $30-40,000 less than half?" She looked at me like she didn't understand the question. So I told her that I had tried to put real numbers on her situation so that she could have some degree of predictability. Yes, the other lawyer could easily tell her she wouldn't get half the house, since it remained the husband's separate property, subject to reimbursements - it wasn't a lie, but the answer wasn't really helpful to the client.

Of course I couldn't tell her what she would get, as we were using estimates all along, with no documents to support the discussion. Maybe it had been an interest only loan, and she was just guessing at the amounts, or maybe the loan had been paid down with a separate property inheritance. These things are never known at this stage, but I knew she wasn't going to walk away with a large bundle of money from the house.

So, of course, the prospective client went back and hired the first lawyer, as she made her feel more positive about what she would get.

Can't argue with that logic, but the client wasn't prepared for the ultimate outcome.

August 1, 2015

Date of Separation for Divorces - In re Marriage of Davis [2015]

California became one of the first states to enact legislation stating that marital property stops being earned when the parties began to live separate and apart. This has been our rule for about 35 years.

In a community property state like California and a number of other western states, the rule made sense; why would we divide income and assets once the two spouses are not working together in some semblance of a shared relationship. Community property recognizes that courts aren't good at valuing the services of the husband and wife, such as where one may work and the other cares for a home. When it became a state, California decided that the value of the parent staying home to raise children could have the same value as the spouse who went to work knowing the home was secure, and selected the community property system. Alright, so that type of relationship may be a fiction, but we also don't want to litigate these issues, so we have a general rule.

As California had the minority rule, some experts have speculated that judges tried to find exceptions to the rule, perhaps to bring us back in line with other states. As a result, we have had varied outcomes when these cases are litigated. Sometimes living separate and apart had no meaning because of the exceptions created - the most famous was a doctor who wasn't living separate and apart on his boat with his girlfriend, in part because he still took his laundry home for his wife to do. [His wife wanted half his earnings after he moved out, and the girlfriend tried to claim the other half.]

One battlefield has been over situations where the parties continue to live together, but one wants to claim the marriage was over, so they were living separate and apart. Last week, in the case of Marriage of Davis, the California Supreme Court decided that "living separate and apart" means that the parties have to be living separate and apart to be separated - in other words, you can't keep living at home, earning income and acquiring assets that you don't have to share with your spouse. What a bizarre outcome - judges who actually got it right. Of course, to muck it up they had to insert a footnote leaving an opening for more exceptions.

I vote for bright lines, like "living separate and apart." Sharp lines limit litigation, which is usually a good goal. Appellate judges live in ivory towers, and don't have to answer to clients when the law does foolish things.

August 1, 2015

Lawyers' Ads, and Reality....

I had a conversation this week with a young lawyer who has been an associate in a small law firm for 2 years. The lawyer is looking for another job that has better long term prospects. I will call the lawyer Bill, which is not the real name, and no inference should be drawn from using the male pronoun as to whether Bill was male or female.

When Bill told me the firms with which he had interviewed, I knew them all well. He said the biggest surprise of the process was the posturing of each firm, and how it represented itself to new prospects. Little they said about themselves matched what he had seen of them and their work.

Much the same happens when you read a lawyer's advertisements, especially on the web. I have regularly complained about lawyers' advertising, as it leads clients to pay more than the should, get worse service, and be more unhappy with the process. Lawyers were better when they got their business by hard work and referrals from other lawyers and past clients.

I address these issues again as this was my last week as a litigator, except to close up some loose ends on a couple of a cases that are almost over.

As I look back on my career, one thing clients cannot legitimately say about me is that I mislead them about the law or the facts of their case in order to et their business. Some client's go away and hire someone who makes them feel more positive about their situation - but getting a divorce is rarely going to have favorable results for either party, and the prospective client should be prepared from the beginning.

In my next blog, I will write about a gimmick for getting business most of us never considered.

July 11, 2014

Shasta Superior Court Family Judge Gibson Denies Existence of Constitution

OK, so the headline is a slight exaggeration, but the effect is the same: Shasta's Judge Gary Gibson doesn't seem to think you have a Constitutional right to refuse to be a witness against yourself, and God protect the attorney who tells you about that right. [Or at least California's Commission on Judicial Performance, which rarely does anything as far as I can tell, might protect you]

We all know about 5th Amendment rights: Basically, the part where you can't be compelled to provide testimony against yourself. Right there, just a couple of amendments below the gun rights part: Been interpreted many thousands of times, so the rule is pretty clear, and not that hard to understand what the courts think it means. It's a lot more than not being able to beat a confession out of you.

It appears from my sources that Judge Gibson, a recent appointee to the bench sitting in a Family Law department, hasn't heard about it. When an attorney told his client not to fill out a portion of a court form based on that right, the attorney was cited by the judge to show why he [the lawyer] shouldn't be sanctioned for giving valid legal advice.

Any lawyer with a 3 digit IQ, and more than a couple of years of experience [or who went to a decent law school], knows that right includes the right not to disclose any fact that could in any way cause someone to think you may have some involvement in criminal activity or tend to prove it - not that you are engaged in a criminal act, but that someone might think you are or were, and might cause you legal grief because of it. Something like: "Have you ever driven a motor vehicle after drinking alcohol?" Pretty innocuous question, but you have a Constitutional [both State and Federal] right not to answer. Now, if you assert your right in a civil matter, the judge may be able draw an inference against you [although not in a criminal case], but he cannot compel you to provide testimony that may tend to incriminate you in any way. [Now, please don't nitpick, I'm trying to simplify this.]

Well, Judge Gibson doesn't care. If you don't put the answer on a court form, citing advice of counsel and the 5th amendment, he feels he can order you to do so, and then cite the attorney to court to explain why the attorney, who is doing what he is supposed to do, should not be punished simply for doing his job.

And, my sources on this point run fairly deep: Not just some whining attorney or self-represented litigant. I don't know the parties, the lawyers, or the guy unfortunately wearing the robe, but I have reliable sources. I don't know the question, and don't know what the client's answer would have been, but it is enough that a lawyer has to go to court to justify legal advice, out of fear of sanctions by an out of control judicial officer.

The unfortunate part of the story is that no one chose to run for election against Gibson this time, his first, so Shasta County is stuck with him for another 6 1/2 years until he has to run again. [A newly appointed judge must sit at an early election where the voters have a chance to second guess the Governor - usually, that person hasn't done enough damage to enough people to run a risk of drawing a willing opponent, because incumbency carries a lot of weight with voters in judicial elections.]

Not having a challenger this time, he must feel pretty safe - often happens with the ignorant and arrogant. Now, as I've said, I don't know Judge Gibson, but I'm told he's not too bright. We've had a lot of such judges on the bench - the best ones make up for it by not going out of their way to make waves, and have long careers. The worst make it to the front page, or have lawyers blog about them.

July 25, 2013

Domestic Violence Prevention, Death, and Law Enforcement

New York City has stepped up Domestic Violence Enforcement, according to a recent article in the New York Times.

The basic premise behind most Domestic Violence laws is to protect victims, obviously, but also to stop minor problems from becoming big problems because pushing and shoving turns to more serious conduct over time.

While some parties and lawyers view Domestic Violence restraining orders as a tactic to gain an advantage at the beginning of a case, such orders may serve a cooling off period that prevents the parties from escalating to more serious behavior out of frustration. As a tactic, however, such orders frequently serve to cause more anger that interferes with the ability to settle cases.

Increasing police involvement to head off bigger problems, as a precaution, may prevent serious injuries and deaths. In the case described in the article, the female kept allowing the male to return, despite police visits - it appears she lied to them the next to the last time police officers went to investigate whether the boyfriend was coming back. The last time was to investigate the females stabbing by him, and her death, a week later.

May 16, 2013

Collecting Delinquent Child Support, License Suspension....

Under a 2012 law, the Indiana Secretary of State suspended the licenses of two Indiana stockbrokers for failure to pay child support - one was from California, but he was licensed in Indiana. We tend to forget that this remedy is available for the very delinquent, but this case brings it back into our focus.

Through the Department of Child Support Services, such remedies have been available in California for many years,

Although DCSS requires that the recipient open a claim with that office, which has its own problems in pursuing support in many cases [including many months of delay and inadequate use of discovery to obtain information], DCSS has available to it several remedies such as this that are not available to private lawyers. We frequently have clients open a file at DCSS so that we can have the advantage of that remedy, while still representing our clients in conducting discovery to determine income and wealth, as well as doing other types of enforcement where a competent, private Certified Family Law Specialist can be more efficient and effective.

License suspension can included driver's licenses, licenses to practice law, dentistry, or medicine, real estate licenses, barber's licenses, and almost any approval from the state required to engage in business. Commonly, we are looking at suspension of building contractor's licenses. In most cases, these actions spur the payor to at least make an effort to pay what is owed, since it can impact his or her ability to earn a living, or even drive a car without fear of being stopped by the police.

Periodically, DCSS will send a list to the U.S. State Department, which interferes with the right to renew or obtain a passport for foreign travel - since you now need one to go to Mexico and Canada, and be able to return, that can cause quite an inconvenience. No more European cruises for the truly delinquent.

May 15, 2013

No Money for California Divorce Courts, etc.

In a recent article in The Recorder, it was reported that Governor Jerry Brown's revised spending plan [his 2013-14 budget] contains no additional money for our courts.

The story quotes a Judicial Counsel lobbyist as stating that the courts will not be able to make payroll by July, 2014, the start of the fiscal year, because of new changes proposed by Brown that will prohibit courts from maintaining a reserve account of any sizable amount for cash flow purposes.

If you have been in a family law department in the last year in San Diego County, you will see part of what budget cuts have done - hearings are set many months out for important issues like child support and custody - court reporters are only available in each department a few days each week, which means that there is no record of the proceedings the other days if you don't bring in your own court reporter - and, no, you aren't allowed to record hearings, so with no record there is no agreement on orders and no ability to be able to mount an effective appeal.

As usual, if you have money, you can take your case out of the court system, but the middle class can no longer afford court hearings even if they can afford lawyers.

May 9, 2013

Valuation of Assets, Businesses and Professional Practices.

The general rule in family law cases in California is that assets are valued as of the date of trial [or settlement, which is how most of our cases are resolved].

From time to time, there are reasons for a different date to be used: For example, an asset that has been damaged or destroyed, or a business that has substantially changed in value allegedly due to the activities of one spouse.

If you have a case involving a business or other asset that has changed value since separation to your detriment, it is important to do two things: Hire an attorney who specializes in business or property matters, and file a motion to request that the court set an alternate valuation date. If you don't, you might find the value set at the date of division [trial], with the other party walking away with a windfall.

This issue comes up most often in valuation of professional practices, such as attorneys, doctors, dentists, and architects. Typically, the value changes substantially after separation, either because the spouse in charge works harder, longer hours, or stops seeking new business [or even starts hiding more income and padding out expenses].

Since the late 1970's, California has provided that anything a spouse earns after the date of separation is his or her separate property - in the U.S., this has been the minority rule. That means that the efforts of a spouse that contribute to the increase in value of the business belong to the working spouse, and the former spouse should not benefit. The other side of the coin is the working spouse not working as hard, etc. These can substantially alter the division of assets, primarily dependent on the date chosen by the court to use as the date of valuation.

In a recent case, a Husband requested the use of an alternate date, in an unpublished appellate court decision, and was denied on the basis that he waited too long to make the request - the trial judge decided that the delay prejudiced the Wife, as the period for conducting discovery had passed when Husband asserted the request. It was affirmed on appeal. [See elsewhere on this blog for a discussion of what happens when an appellate decision isn't published.]

May 7, 2013

Unpublished Appeals Court Opinions

From time to time, you may read or hear about appellate court decisions that are unpublished. These are decisions of a court of appeal that do not find their way into the state's official reports of the courts. While these decisions are important to the litigants, the appellate court may feel that the rules in the decision are repetitive, or they just don't want the results made part of the official record, either because the facts are very unusual, or they don't want courts and lawyers relying on the reasoning that resolved a particular case.

For lawyers, such decisions create several problems. Because they are not in the official reports, they may be difficult to find and are usually not indexed so they can be searched. They are often sought out by us to find the law cited by the opposing parties from which we can draw research or arguments on a particular subject where there are no reported decisions, or where we don't like results in cases that are reported They also may have been read by the trial judges, who may rely on the reasoning in forming their own conclusions about the law, and we don't know what they think as a result.

In California, from the lawyers' standpoint a big problem with such decisions is that they cannot be cited as the law in court or in the legal arguments we file with the court in support of our clients' legal positions. For courtroom purposes, although they may impact the beliefs of the judges and lawyers, they do not exist.

November 20, 2011

Training Lawyers and a Lack of Legal Training...

Several years ago, a New York Times article discussed the lack of legal training designed to help a lawyer practice law, and changes coming in firms and law schools that recognize the problems this lack of training creates.

Contrary to public opinion, law school doesn't prepare a lawyer to practice law - graduating and passing the bar exam merely gives you the opportunity to practice. The system assumes some form of mentoring as the young lawyer goes from knowing nothing to bare competence - from there, skills should improve over the years as the lawyer gains experience, largely through trial and error, often making mistakes in smaller cases. As you gained skills and experience, people would h

As a beginner under the old system, the young lawyer had one advantage: Lots of free time. He or she could research any issue very thoroughly, where the older, experienced lawyer with a busy practice often relied on memory of statutes or appellate court decisions he or she had read over the years, which may no longer be fresh in his or her mind.

Continue reading "Training Lawyers and a Lack of Legal Training..." »

September 1, 2011

Fox News, Maternity Leave, Government Benefits, & Hypocrisy...

If you watched John Stewart August 11th, you got a clear look at Fox News Hypocrisy.

A "reporter", fresh from maternity leave, confronted a talk show host who had called such leave a racket, and when he objected that men don't get such leave she proudly announced "oh, yes they do," to justify her defense of taking the benefit from her employer. She was very vocal about the need for such a social program forced on employers by the government, and how good it is for society.

Now, as a small business man, I have a problem with maternity leave for small businesses, where the loss of a key employee can have a devastating effect - often a person who cannot be replaced without months of training of someone to take his or her place must be replaced for a few months, but that is a nuance about application rather than opposition entirely as a matter of social policy. It would have a major impact on my law practice if I lost one of my paralegals for 3 months.

The problem is that this reporter had previously railed against such benefits as Socialism. Stewart was pointing out the problem when you take a benefit that affects you, but object to the same or similar benefits when they affect someone else. This happens over and over again on the network, but also among those who use the "conservative" badge to advance their own causes.

A prime example is Michelle Bachman and her family - she gladly accepts subsidies for one family business, and Medicare payments that support another. Another is the red state politicians demanding aide from FEMA for the recent floods, while those from states that weren't flooded insisting the government cut other programs before helping with the cleanup and rebuilding programs, let alone the need to help individuals feed, clothe, and house themselves on a short term basis.

There are good and bad in most such programs - that's why I take a more nuanced view, where you tailor the program so that it does a combination of good, without too much bad. This happens time and time again in government, and why compromise is essential.

June 28, 2011

It's the Lawyers' Fault.....

Here's a typical client's excuse: Felon blames his lawyers.

Invariably, no one wants to accept responsibility for their own wrongdoing. Here's a guy who plead guilty for bribing a congressman, among his many woes. As he sits in jail, his excuse is that he didn't read the plea agreement he signed, just before he was sent to jail to serve the agreed upon sentence - he wants us to believe he thought he was just going to get a slap on the wrist and go about his business, and the lawyers didn't explain it to him properly. He claims that the only reason he was sent to jail was that he wouldn't name the other congressmen he'd bribed. I like that story, and it's certainly funnier than "the lawyers made me do it."

Last week I watched as a former client testified in court that he wasn't at fault for putting his girlfriend down as his spouse on his income tax forms. He "relied on the professional," his accountant, to put her income on the form someplace and it wasn't his fault she was listed as his spouse. The other testimony was that he'd said that "The judge will certainly understand that I was just trying to save money." He claimed she wasn't his wife when she wanted support and some of his earnings - the judge agreed she wasn't his wife, but entitled to the same rights as a wife because he had claimed her as such for years - year after year, in fact, until he was done with her.

April 1, 2011

E-mail, Instant Messaging, Facebook, and other electronic communications...

Watch what you write - those e-mails and instant messages may come back to haunt you. In a recent trial in Federal District Court in Florida, an instant message between two parties to a business contract were found to have made a major modification to their contract. A more complete report can be found here. One party to the exchange didn't like the court adopting what it deemed to be a modification of a prior written agreement - where a contract required any modification to be in writing, the court found that the IM exchanges satisfied that requirement even though they were very cryptic.

It is amazing how quickly people dash off messages, forgetting they may be read much later - the electronic form allows speed without much consideration. Or they make an agreement, but later forget they have done so. And once the message is turned into electrons, it can last forever with endless copies being made and transmitted.

In Family Law, we see people post things on their Facebook pages or send what they believe to be a witty remark - usually we see them for the first time when someone attempts to produce them at a hearing. They can sure be embarrassing.

March 31, 2011

Divorce in San Diego, Elkins, Court Resources and Delay....

Several years ago, Mr. Elkins was getting a divorce in Contra Costa County - he ran into a buzz saw when he showed up for trial. Much to his surprise, the judge essentially wouldn't let him present a case because he hadn't followed local court rules - mainly, he hadn't reduced all the testimony he wanted to present into declaration form. Those rules were specifically designed to eliminate trials in Family Law matters in that county.

San Diego is what is known as a Reifler County - pursuant to a California court case in the Marriage of Reifler, on a county by county basis, courts have been allowed to use declarations in lieu of oral testimony in family law cases - it's clearly faster and more convenient, and in the vast majority of cases justice is done by that process - if you want oral testimony, there is a procedure to follow, but the judge has discretion not to allow it. For trials, however, San Diego has always required oral testimony.

In theory, the Elkins decision had no impact on San Diego divorce cases. Unfortunately, for most litigants it isn't that easy. After Elkins, an "Elkins Task Force" was created to solve all the problems in the family law courts. [Insert smiley face here] They ran with the ball and have managed to make a major upheaval by permitting testimony in all hearings as a matter of right, and allowing children to testify in their parents' divorce.

These changes, part in force now and part in 2012, are going to make family law cases much more expensive and much more complicated. Rather than increasing justice, they will deprive more people of their ability to effectively present their cases. In the best of times, divorce courts have been the poor stepchild of the law - the worst court rooms, an insufficient number of judges, and judges poorly trained in the subject matter.

The high volume quickly too its toll on the best of judges, let alone those with no prior family law experience. Because of the high volume of cases assigned to each judge, the emotions attendant to the decisions, the number of substantive decisions that need to be made in each case, and the effect on families of mistakes, burn out among judges often comes quickly.

Where are the judges going to come from to handle the increased work load required by so much oral testimony? Certainly not from the judges who have the seniority to balk if assigned to a family law department.

Where it may take two to four months to get a hearing on a one hour matter before the new changes in the law, what will happen if it takes twice as long to get a hearing because the judge is busy hearing hour after hour of senseless testimony? Increasing chaos, less justice, and higher cost overall.

February 24, 2011

Gays, Marriage, the Constitution, and Defense of Marriage Act....

Irrespective of your view of gay marriage, if you studied Constitutional Law you had to conclude that the Defense of Marriage Act [DOMA] wasn't constitutional. Essentially, this Clinton era legislation was to appease those who didn't like the idea of homosexuals getting married - this Federal law provides that a state is not required to recognize same sex marriages conducted legally in another state.

This became big news this week when the administration announced it no longer intended to waste time and energy enforcing the law. For students of the Constitution, however, it's not really big news except that a government employee has openly sided with reality.

The problem with the law is a provision in the U.S. Constitution that requires one state to provide "full faith and credit" to the public acts, laws, and court decisions from every other state: Article IV, Section 1. In simple terms, this means such things as a court ruling in one state being entitled to enforcement in another, or a contract validly made in one state is enforceable in another.

When the DOMA was enacted, it was my first reaction that the law violated this provision of the Constitution. There is a strong need for too many politicians to make it look like they are doing something to satisfy their core constituents. Where I have a problem is that they won't admit that they are wasting a lot of time and effort on window dressing to satisfy the ignorance of the voters. Unfortunately, those who claim to want strict enforcement of the country's founding document really only want to enforce the parts of the Constitution they like best, and don't see the hypocrisy. After all, the document is more than the 2nd amendment.