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Law Tips: Be Vigilant Concerning Spousal Rights After the Death of One Party

Divorce Law vs. Estate Law

Is Filing For Divorce Close Enough? Does “It ain’t over ’til the fat lady sings” apply in divorce? What happens to all the spousal rights when a divorce is pending but one party dies before the final dissolution decree is entered? In most situations, not much. You are still husband and wife. Filing an action for dissolution does not terminate a spouse’s marital status for purposes of inheritance and other death-time rights. Only the decree of dissolution determines that the status of marriage has ended…

In our recent CLE entitled Divorce Law vs. Estate Law & Designated Beneficiaries Kent Jeffirs, our faculty participant who practices in Crown Point, Indiana, takes up issues such as “Death During Divorce: Is Filing For Divorce Close Enough?” and “Little Known Statutes that May Fight the Good Fight in Death During Divorce.” I’m pleased to bring Law Tips readers a bit of Kent’s expertise in preventing unfortunate and difficult-to-solve circumstances for your clients.

…While one could change his will while the divorce is pending, the spousal allowance and right to elect against the will remain until the final dissolution decree is entered. So no matter how contentious the divorce and no matter how long the parties have been separated, the surviving spouse in a divorce where no final decree of dissolution was entered can claim any individually titled property he stood to lose in the divorce, all jointly titled property as the surviving co-owner, plus a spousal allowance of $25,000 and an intestate or elective share of any assets of the deceased spouse’s estate that were titled in her name alone if the surviving spouse was fortuitous enough to have his spouse die while the divorce is pending. Indiana case law and statutes offer very few avenues for relief upon the mere filing for divorce if the final dissolution decree is not entered prior to the death of a party to the divorce.

“Little Known and Little Used Statutes that May be Used to “Fight the Good Fight” Upon the Death of a Party During a Dissolution of Marriage Action”

Two statutes contained in the Indiana Probate Code have remained as descendants of two statutes promulgated by the Indiana Legislature in the middle of the nineteenth century (the 1850′s!). These statutes have carried through what some consider to be antiquated concepts of penalizing “adultery” and “spousal abandonment” to modem times in spite of the law’s “more enlightened” transition to “no-fault” divorce. Indiana Code 29-1-2-14 and 29-1-2-15 provide as follows:

29-1-2-14. Adulterous husband or wife. If either a husband or wife shall have left the other and shall be living at the time of his or her death in adultery, he or she as the case may be shall take no part of the estate or trust of the deceased husband or wife.

29-1-2-15. Abandonment of spouse. If a person shall abandon his or her spouse without just cause, he or she shall take no part of his or her estate or trust.

See also I.C. 30-4-2.1-9. Applicability of adultery and abandonment forfeiture provisions.
(A trust of a deceased spouse is subject to the following: (1) I.C. 29-1-2-14 and (2) I.C. 29-1-2-15).

In Estate of Calcutt v. Calcutt, 576 N.E.2d 1288 (Ind. App. 1991), trans. denied, the court reaffirmed much earlier decisions that pursuant to I.C. 29-1-2-15, in order for the prohibition in 29-1-2-14 to apply, the surviving spouse must have “abandoned” the decedent before his or her death. See also In re Estate of Patrick, 958 N.E.2d 1155 (Ind. App. 2011 ) (Trial court properly denied estate’s motion to dismiss husband’s petition for survivor’s allowance under I.C. 29-1-4-1 as he did not “leave” his wife within the meaning of l.C. 29-1-2-14. Evidence supported trial court’s finding that husband and wife had separated by mutual consent, which did not support a finding of abandonment.)

One might ask if “abandonment” is necessary under I.C. 29-1-2-14 to prevent a surviving spouse from obtaining the survivor’s allowance or any portion of the estate, is 29-1-2-15 redundant? Note that under 29-1-2-15 no adultery is required. However, as reaffirmed by the above appellate decisions, 29-1-2-14 does require a finding of “abandonment” before a spouse will lose their spousal allowance or inheritance. Indiana Code 29-l-2-14′s requirement that a spouse “shall have left the other” has thus been interpreted as synonymous with “abandonment.”

These statutes should be utilized with extreme caution. Harking back to the days of having to prove fault as grounds for a divorce, many practitioners believe these statutes lead to extremely negative and costly litigation where an estate may try to take advantage of the surviving spouse in what had become a troubled marriage or may involve pitting “blended families” against one another in contentious litigation or even seek to assign blame when one spouse commits suicide.

While this author agrees with many of the negative sentiments expressed on this topic, repeal of these statutes while the law provides that the death of a party during a divorce has little or no effect on a soon-to-be-ex-spouse receiving all or a substantial share of the deceased spouse’s estate would be inequitable. Indiana’s Probate Code provides that a spouse cannot be appointed executor of the deceased spouse’s estate if a divorce is pending, but that divorcing spouse can nonetheless claim any individually owned property he stood to lose in the divorce, all jointly held property as the surviving co-owner, a spousal allowance of $25,000 and an intestate or elective inheritance if he is fortuitous enough to have his spouse die while the divorce is pending. If the “antiquated” Abandonment and  Adultery Statutes is to be changed, this harsh result should be changed also.

Thanks to Kent Jeffirs for his commentary on important issues concerning death during divorce. This conversation will continue in Law Tips next week as he provides more input for you on what divorce lawyers can do to protect clients’ estate rights. FYI, Kent offers a comprehensive discussion of the situations you may encounter with your clients during his CLE presentation, addressing subjects such as, executors, ERISA and divorce court jurisdiction. If you are interested in the Video Replay or the On Demand Seminar of  “The Main Event: Divorce Law vs. Estate Law & Designated Beneficiaries,”  Click Here.

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About our Law Tips faculty participants:
Kent A. Jeffirs is a sole practitioner in Crown Point, Indiana, who for the last 22 years has concentrated his legal practice in estate planning, probate and trust administration, guardianships, real estate and small business counseling. In 2007, Mr. Jeffirs was one of the first group of Indiana attorneys to be board certified as a Specialist in Wills, Trusts & Estates by the Indiana Trust and Estate Specialty Board. He has also testified in court proceedings as an expert witness on probate matters. Mr. Jeffirs received his B.A. degree, with honors, from the University of Notre Dame, and his J.D. degree, magna cum laude, from Indiana University, Bloomington.

About our Law Tips blogger:
Nancy Hurley has long-standing connections with Indiana lawyers. She was formerly a member of the ISBA and IBF staffs for over 30 years. Nancy’s latest lifestyle venture is with ICLEF. We are utilizing her exceptional writing and interviewing skills while exploring how her Indiana-lawyer background fits with ICLEF’s needs. When she isn’t ferreting out new topics for Law Tips, her work can be found in our Speaker Spotlight blogs, postings on the ICLEF Facebook and Twitter pages, and other places her legal experience lends itself.

Thank you for reading Law Tips. You may subscribe to this weekly blog through the RSS link at the top of this page.  Also, you are encouraged to comment below or email Nancy. She welcomes your input as she continues to sift through the treasure trove of knowledge of our CLE faculty to share with you.

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

Posted in Law Tips, News0 Comments

“Lawful Custody” Means Legal, Court Ordered Custody…

Case: In the Matter of the Adoption of B.C.H., a Minor 
by Mike Kohlhaas, Bingham Greenebaum Doll

HELD: Under the adoption statute’s requirement to give notice to, or receive consent from, persons having “lawful custody” of a child who is the subject the adoption, this term means legal, court-ordered custody of the child. Thus, Grandparents who asserted themselves to be de facto custodians of the child were not required to receive legal notice and/or consent to the adoption.

FACTS AND PROCEDURAL HISTORY:
Mother gave birth to Child in 2007, out of wedlock, while still in high school. Mother lived in an apartment, and not with her parents. It was apparently uncontroverted that for most of the first few years of Child’s life, Child lived with the maternal Grandparents, spending only a day or two per week with Mother.

In 2010, Mother married Stepfather, who later initiated proceedings for Stepfather to adopt Child. Grandparents received no legal notice of the adoption, but they were aware it had been filed by Stepfather and they made no effort to intervene to contest it. After the adoption was granted, Mother and Stepfather took physical custody of Child back from Grandparents.

In 2012, Grandparents moved to re-open the adoption under a Trial Rule 60 motion, arguing that the adoption was granted improperly without their notice or consent. That motion was eventually denied, from which Grandparents appealed.

The Grandparents’ theory on appeal was that they had de facto custody of Child which, in turn, conferred upon them rights as having “lawful custody” under the adoption statute’s notice and consent provision for “[e]ach person, agency, or local office having lawful custody of the child whose adoption is being sought.”

The Court of Appeals acknowledged this case to present two issues of first impression in Indiana: (1) whether “lawful custody” under the adoption statute means the same as “legal custody” that has been ordered by a court; and (2) whether Grandparents qualified as lawful custodians by meeting the statutory qualifications for being de facto custodians.

After an extended review of the rules of statutory construction, and particularly the obligation to construe statutes in derogation of the common law narrowly, the Court concluded that “lawful custody” under the adoption statute means “legal custody” that has been ordered by a Court.

In addition, the Court concluded that, even a judicial finding that the Grandparents were de facto custodians of Child would not give them “lawful custody” of the Child for purposes of the adoption statute. “[Q]ualification as a de facto custodian — even through court order — does not automatically result in legal custody. It is merely one factor in support of an award of legal custody.”

Thus, the trial court did not abuse its discretion in concluding that the Grandparents were not subject to the notice / consent provision of the adoption statute and denying their Trial Rule 60 motion.

Judge Mathias wrote a separate opinion, concurring in result, expressing his belief that, having established themselves as de facto custodians of the child, the Grandparents were entitled to notice of the adoption. However, because in this instance the Grandparents were actually aware of the adoption as it was filed and failed to intervene and object, that actual notice satisfied the procedural notice requirement.

To view the text of this opinion in its entirety, click here: In the Matter of the Adoption of B.C.H., a Minor

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The Indiana Family Law Update is a free service provided by the Matrimonial Law Group of Bingham Greenebaum Doll, LLP. While significant efforts are made to ensure an accurate summary and reproduction of each opinion, readers are advised to verify all content and analysis with a traditional case law reporter before relying on the content and analysis offered here.
ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

Posted in Family Law Case Review1 Comment

Trial Court Erred Modifying Custodial Arrangement Absent A Request From Either Parent

Case: Shelly Bailey v. Lance Bailey 
by Mike Kohlhaas, Bingham Greenebaum Doll

HELD: Trial court erred when it modified the custodial arrangement to joint physical custody in the absence of a request from either parent to do so.

FACTS AND PROCEDURAL HISTORY:
Mother and Father divorced in 2010, with two children. At the time of Decree, they were granted joint legal custody, with Mother having primary physical custody subject to Father’s age-appropriate parenting time schedule per the IPTG.

An extremely high-conflict relationship between Mother and Father followed. In early 2013, the trial court held a hearing on several pending motions: a contempt by Father against Mother for failing to pay a marital debt; a contempt by Father against Mother for denying Father’s parenting time; and a petition by Mother to restrict Father’s parenting time. At the end of the hearing, the trial court asked the attorneys: “do I have the ability to enter a Parallel Parenting Time Order based upon the pleadings that are before the Court?” Counsel for Mother responded in the affirmative.

After the hearing, the trial court denied all of the pending motions, but entered an order with sua sponte findings, concluding that Mother and Father “shall share joint physical and legal custody” of the children, providing for an alternating week parenting time schedule. Also, finding the parents to be “high conflict,” the trial court entered various provisions from the Parallel Parenting Time provisions of the newly-revised IPTG. Mother appealed.

The Court of Appeals reviewed the various procedural safeguards that govern modifications of custody. Generally, custody may be modified only when one party has filed a petition for modification, served notice of same on the other party, and a proper evidentiary hearing is held allowing both parties an opportunity to be heard. Finding this case did not comply with those safeguards, nor fit into any of the limited exceptions to the general rule, the trial court committed error.

The Court of Appeals also “emphatically” rejected Father’s argument that the order constituted only a modification of Father’s parenting time, not a change of custody. But the Court responded that an increase from the IPTG schedule, to equal time, constituted a “de facto modification of custody and requires compliance with the statutes governing custody modification.”

The trial court’s order was reversed.

Judge Baker dissented, concluding that the affirmation by Mother’s counsel that the trial court had the authority to issue a parallel parenting plan amount to consent that the trial court could issue the resulting order.

To view the text of this opinion in its entirety, click here: Shelly Bailey v. Lance Bailey

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The Indiana Family Law Update is a free service provided by the Matrimonial Law Group of Bingham Greenebaum Doll, LLP. While significant efforts are made to ensure an accurate summary and reproduction of each opinion, readers are advised to verify all content and analysis with a traditional case law reporter before relying on the content and analysis offered here.
ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

Posted in Family Law Case Review0 Comments

Marital Estate Divided 97% / 3% in Favor of Husband

Case: In re the Marriage of: Jose de Jesus Carrillo Perez and Maria Guadalupe Carrillo Perez, Maria Guadalupe Vidrios Zepeda f/k/a Maria Guadalupe Carrillo Perez v. Jose de Jesus Carrillo Perez 
by Mike Kohlhaas, Bingham Greenebaum Doll

HELD: Trial court acted within its discretion when it divided a marital estate more than 97 / 3% in favor of Husband, where the evidence established that almost the entire marital estate consisted of Husband’s lottery winnings, which Husband acquired well after the parties had physically separated and were living entirely separate lives, even though neither of them had filed for legal separation or dissolution.

FACTS AND PROCEDURAL HISTORY:
Husband and Wife married in 2002. They physically separated in March 2006. While neither party filed for legal separation or divorce, for the following six years they did not live together, spoke only a few times, had completely separate finances, and lead separate lives.

In January 2011, Husband won $2,000,000 in the Hoosier Lottery, and filed for dissolution of marriage two months later.

The trial court’s decree provided that each party would keep his/her respective property and liabilities, except that Husband would pay Wife $50,000 out of his lottery distributions, pay $2,852 of Wife’s attorneys fees, and assume $2,484 of Wife’s debts. Wife appealed.

It appeared uncontroverted that the lottery winnings were “marital property” as a matter of Indiana law. However, the Court of Appeals concluded it was within the trial court’s discretion to deviate so heavily in Husband’s favor in light of the lengthy estrangement during which the lottery winnings were acquired.

On appeal, Wife also advanced a second argument, that Husband failed to respond to a Request for Admission that a distribution of 70% of the lottery money to Wife would be “a fair and equitable distribution” of the marital estate. While the Court of Appeals agreed the request was deemed admitted by operation of law, the way the admission was worded – that suggested division was “a fair and equitable division,” not “the only fair and equitable division” – the trial court remained free to consider other fair and equitable divisions of the marital estate, including the one it decided upon.

The trial court’s Decree was affirmed.

To view the text of this opinion in its entirety, click here: In re the Marriage of: Jose de Jesus Carrillo Perez and Maria Guadalupe Carrillo Perez, Maria Guadalupe Vidrios Zepeda f/k/a Maria Guadalupe Carrillo Perez v. Jose de Jesus Carrillo Perez

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The Indiana Family Law Update is a free service provided by the Matrimonial Law Group of Bingham Greenebaum Doll, LLP. While significant efforts are made to ensure an accurate summary and reproduction of each opinion, readers are advised to verify all content and analysis with a traditional case law reporter before relying on the content and analysis offered here.
ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

Posted in Family Law Case Review0 Comments