The entire opinion can be found here.

The court made two important rulings:  1.  That the trial court’s spousal support award of $4,000 per month against husband should be reduced to $400 per month; and 2.  That only Husband’s actual ownership portion in a piece of real property could be attributed to him.

Wife was unable to prove any future earning capacity for Husband.  The trial court, however, found that Husband had a high future earning capacity and thus awarded Wife the higher amount of spousal support.  The Court of Appeals held that in the absence of an estimate of Husband’s future earning or that he has the ability to pay the high amount of spousal support awarded by the trial court, that the trial cour erred in providing such a high support award.

The entire opinion can be found here:  http://www.publications.ojd.state.or.us/A138497.htm

The lawyers at Stephens Margolin PC can assist you with your spousal support legal matters from trial through appeal.

1. executed voluntarily
2. Not unconscionable when it was executed and, before signing, the party
3. Was  provided a fair and reasonable disclosure of the property or financial obligations of the other party;
4. voluntarily waives in writing, any right to disclosure of the property or financial obligations of the other party beyond the disclosure
5. provided; and
6. Had or could have had an adequate knowledge of the property or financial obligations of the other party.

Spousal support rights can be altered, however, if the support provisions would cause the spouse to go on public assistance, the court can order enough spousal support to prevent this from happening.

If you are contemplating a new marriage and have income or assets you wish to protect in the event of divorce, or if you are asked to sign a prenuptial agreement you should consult with a lawyer.  The lawyers at Stephens Margolin PC have substantial experience representing clients with prenuptial agreements.

Can spousal support be modified? Yes. In Oregon, spousal support is modifiable. The party seeking the change must show a  substantial, unanticipated change in economic circumstances. You can agree to make spousal support non-modifiable in your divorce judgment, but your divorce judgment must contain a specific waiver of your right to modify support. The reason the court awarded support has a lot to do with how the court will view a motion to modify.

Can spousal support be increased? Yes, but courts generally don’t increase spousal support awards absent extraordinary circumstances, like an ex spouse getting sick or becoming disabled.

Can spousal support payments be reduced? Yes, if the moving party can show a substantial, unanticipated change in their finances.  For example, if the paying ex spouse looses their job, the court may reduce support. Also, if the ex spouse receiving support increases their income, the court may also reduce support.

Can the duration of spousal support be extended or reduced? Yes, if the reason spousal support was awarded no longer exists. For example, if support is ordered to ease a spouse’s transition into the workforce, and they get a good job, support may no loner be necessary, or may be stopped altogether.  Also, if an ex spouse is not yet self sufficient and support is set to terminate, the court may extend the duration of support.

Can spousal support be reinstated after it stops? Yes, if the reason for the termination ceases to exist, and the motion to reinstate is filed during the original duration of the support award.

The above is an overview, and a careful analysis of  your finances, judgment and case  is critical defending or requesting a change in spousal support.   If you have questions about your spousal support rights or obligations and are thinking of modifying, you should talk to an experienced family law attorney about your support award.

The person paying spousal support should:

• Make a detailed spreadsheet which lists all payments made.  The method of payment, check number, date, and the address to which the check was sent or direct deposit made should all be listed.  In addition, a copy of the outgoing payment should be kept;
• If payments are going to be made in cash, then the payee should sign a receipt at the time payment is accepted. 

The person receiving support should:

• Make a detailed spreadsheet which lists all payments received.  Including, the date the payment was received, the amount received, the check number or electronic payment record, the bank and account from which the payment was made.
• In addition, a copy of the payment should be kept.

Both parties should be aware of the tax impact of spousal support payment or receipt and should discuss how to appropriately deal with tax issues with his/her CPA.  You should contact a lawyer if you have any questions about your current spousal support award.

The case dealt with what the proper amount of maintenance spousal support should be pursuant to ORS 107.105.  Wife assigns error only to the trial court’s award of transitional spousal support, in the amount of $2,000 per month for two years, arguing that, because of her health problems and the disparity in the parties’ earning capacities, the trial court should also have awarded indefinite maintenance support. The trial court recognized the disparity in the parties’ earning capacities– that wife had no income and some fixed expenses, and that husband had significant income and the ability to assist wife with her expenses.  The court further found that it was highly unlikely that, even with retraining, wife would ever attain the earning capacity of husband.  The court found, however, that because the parties kept their finances largely separate, wife has had little benefit from husband’s earnings during the relationship and has not enjoyed during the marriage a standard of living that would be commensurate with that level of income.  The court found further that wife has the ability to supplement her income and that, given wife’s employment skills and talents, she could be self-sufficient.  The court found that wife’s employment possibilities would be only minimally impacted by her physical problems.  Because husband had been providing wife with some financial help, the court awarded wife transitional support of $2,000 per month for two years so that she could retrain as a medical coder.

The court of appeals, basing its decision on the fact that maintenance support is designed not to allow the dependent spouse to become financially independent and self-supporting, ruled that wife should be granted an award of maintenance support in the amount of $1,500 per month for a period of seven years.

Spousal support awards are very fact specific. It is important to clearly tie the facts of a person’s need for support to the reasons articulated in Oregon’s statutory framework.

Husband and Wife were married for 22 years, and separated a few years prior to trial.  Wife gave up employment opportunities of her own to further Husband’s career.  The parties had a household income of $14,000 per month, consisting of Husband’s income of $10,700 and Wife’s income of $3,300. 

Husband argued that his income should be only $7,900 per month because the remainder was from a position that he termed temporary.  Husband also argued that Wife’s income should be presumed to be higher because she was underemployed.

Trial court awarded indefinite support in the amount of $1,500 per month. 

The Court of Appeals held that Wife was not underemployed as she was already working full time and is not, for spousal support purposes, required to work at the highest possible salary.  The amount of spousal support must be “just and equitable” under the totality of the circumstances.  Specifically, ORS 107.105(1)(d)(C) provides a nonexclusive list of factors that we consider in establishing a just and equitable support award for spousal maintenance support, which include (1) the duration of the marriage; (2) the standard of living established during the marriage; and (3) the parties’ age, income and earning capacities, training and employment skills, work experience, and financial needs and resources.  The Court of Appeals modified the support award up to $2,500 per month indefinitiely because “without a substantial award of spousal support, wife’s standard of living following the dissolution will be significantly diminished when compared to the parties’ predissolution lifestyle, which was based on a monthly household income of approximately $14,000.”

The opinion can be found here:  http://www.publications.ojd.state.or.us/A139055.htm

On August 5, 2009, the Court of Appeals ruled in the case of Morales and Morales, in which the court modifies the trial court’s ruling with respect to spousal support based upon the wife’s appeal.

Husband and Wife married when he was 22 and she was 17.  Their marriage lasted for over 35 years.  Wife raised the parties’ children, never working outside the home, while Husband served in the army.  Husband retired from the army in 1992, after 20 years of service, for medical reasons. 

Wife was awarded $2,000 per month in support at a temporary hearing, in order to cover joint family expenses along with her own individual expenses.  At the hearing, the trial court imputed minimum wage income to wife and advised her to obtain a job.

At the time of trial, husband’s income totaled approximately $5,200 after subtracting taxes and payment for his child’s health insurance.  His income included $3,210 in nontaxable disability payments.  Wife had attempted to find a job, but was still unemployed.  The trial court awarded wife spousal support in the amount of $1,000 per month for one year, $800 per month for two years, and then $500 per month indefinitely.  The court imputed minimum wage income to wife and made a ruling that the nontaxable disability income for husband could not be divided by the court.

On appeal, wife argues that the award of $500 per month is inequitable and husband counters that the award is appropriate based upon husband’s non-disability income. 

The court of appeals explains that husband’s nontaxable disability income is in to be considered income for support purposes, regardless of whether it can be divided as part of a property distribution.  Oregon law defines “income” for purposes of support payments, as, among other things, “any program or contract to provide substitute wages during times of unemployment or disability.”  ORS 25.010(7)(f); see also OAR 137-050-0340 (for purposes of support, “gross income includes income from any source including, but not limited to * * * disability insurance benefits” (emphasis added)).  In addition, the court held that federal law does not restrict the court’s ability to consider the disability payments as income. 

The court of appeals then goes on to consider what amount of support is “just and equitable.”  Based on the length of the parties marriage, the parties’ respective situations, and the parties’ respective incomes or ability to obtain employment, the court of appeals held that wife should be awarded an amount of $1,400 per month indefinitely. 

The entire opinion can be viewed here:  http://www.publications.ojd.state.or.us/A134242.htm
The lawyers at Stephens Margolin P.C. can assist you with your family law appellate questions. If you have any questions about Oregon appellate law please contact Daniel Margolin, who focuses part of his practice on family law appeals, or C. Sean Stephens at Stephens Margolin P.C.

On April 15, 2009, the Court of Appeals ruled in the case of McLauchlan and McLauchlan.

Husband appealed from the trial court’s ruling in his divorce with regard to the division of property and the award of spousal support to his ex-wife.

As part of the division of assets, the court awarded the “Butte Falls” property to wife provided that she could come up with a plan to refinance the property in order to pay to husband his equalizing judgment. On appeal, husband argued that the trial court did not have the authority to incorporate wife’s refinance plan into the divorce judgment, and that the trial court should have ordered the property sold rather than awarding it to wife. At issue was husband’s claim that wife, and thus the trial court, undervalued the property at trial. The court of appeals held that husband did not property preserve the error at the trial court level because he did not argue that the court lacked authority to do what it did and further that husband had the opportunity to present evidence regarding the value of Butte Falls but did not.

With regard to spousal support, the trial court ordered that husband pay spousal support to wife and reduced the amount of support to a “lump sum present value.” Husband disagreed witht both the amount and the reduction to a present value. Despite the fact that wife agreed with husband that it was error for the trial court to provide for a lump sum present value for spousal support, the court of appeals held that the parties misunderstand the law and that the trial court acted properly.

ORS 107.105 provides that a divorce judgment may provide for spousal support both “in gross or in installments or both.” The trial court awarded wife $1,000 per month for a period of five years and also provided that as part of the refinance of Butte Falls, she can deduct $54,000 (which the court deemed as the present value of the spousal support award). The court of appeals held that it was proper for the trial court to provide for alternative awards, both of which are proper under the terms of the statute.

The entire opinion can be viewed here: http://www.publications.ojd.state.or.us/A134002.htm

The lawyers, including Daniel Margolin, who focuses part of his pratice on family law appeals, at Stephens Margolin P.C. can assist you with your family law questions. As this case shows, it is crucial to have a competent attorney at both the trial court and appellate level. If you have any questions about Oregon appellate law please contact Daniel Margolin or C. Sean Stephens at Stephens Margolin P.C.

As part of any life insurance provision in a judgment, a clause is always added stating that a “constructive trust” will be established over the life insurance proceeds. On April 15, 2009, the Oregon Court of Appeals ruled on this issue in the case of Tupper v. Roan v. Tupper.

Jerry Tupper and Heather Tupper divorced in 2004. As part of the divorce, Jerry was required to provide a life insurance policy in the amount of $100,000 to secure his child support obligation. In addition, the judgment stated that a constructive trust would be established over the proceeds of any life insurance policy if a party designates a different beneficiary on the policy.

Jerry started living with Danette Roan shortly after the divorce and designated her as the beneficiary on his life insurance policy in direct violation of the terms of the judgment. Jerry died in 2006 and the proceeds of his policy went to Danette. Danette received $600,000 and no money went to Heather to secure Jerry’s child support obligation.

Heather sued Danette claiming that she improperly kept $100,000 in violation of the terms of the judgment. Danette’s response was that she was not aware of Jerry’s obligation to maintain a life insurance policy for child support before he died. Danette further asserted that the court could not impose a constructive trust over the $100,000 because Heather could not prove that Jerry transferred property to Danette that rightfully belonged to Heather and that Danette either knew or should have know of that wrongful conduct.

The court of appeals ruled in Danette’s favor, holding that since Jerry created the life insurance policy after the divorce, Heather did not have an interest in it at the time of the divorce and it was therefore never her property.

For clients, this case creates a difficult situation. Unless a party has a life insurance policy in place at the time of the divorce, the other spouse will likely have a very difficult time obtaining the funds from that policy unless the other spouse follows the requirement to maintain the beneficiary designation required by the terms of the judgment.

If you have questions about life insurance provisions in divorce, custody, or other support situations, the lawyers at Stephens Margolin P.C. would be happy to answer your questions. The entire opinion can be viewed here: http://www.publications.ojd.state.or.us/A136095.htm.