On December 23, 2009, the Oregon Court of Appeals filed its decision in Baker and Andrews, a dissolution of domestic partnership case.  The entire opinion can be found here:  http://www.publications.ojd.state.or.us/A135564.htm.

                Baker and Andrews were an opposite sex couple who lived together for many years.  Baker appealed the trial court’s order that no domestic partnership existed and from an order of the court awarding Andrews sanctions against both Baker and her attorney.  The court of appeals agreed with the trial court with respect to its ruling that no domestic partnership existed, but reversed the trial court with respect to its ruling on sanctions.

                They lived together for 24 years, and shared a home and bed and raised their own separate children to adulthood in the home during that time.  They maintained separate bank accounts. Baker did some work outside of the home and Andrews owned a business (that Baker did some work for without pay).  Baker also worked as a homemaker.   They had no agreement as to their financial relationship.  Andrews added Baker to the title on the house in 1994, but Baker then signed a quitclaim deed releasing her interest in the home in 2004.  She also filed for SSI disability, stating in her application that she did not expect anything from the home and that she lives financially separately from Andrews.

                The trial court did not find Baker to be credible, a finding upon which the court of appeals must rely. 

                Oregon does not recognize common law marriage.  Under the court’s decision in Beal and Beal and subsequent cases, however, Oregon has a body of case law that recognizes that where parties intend to create a domestic partnership that the court can then equitably divide their property and debts.  The court of appeals describes this as follows:  “In general, an equitable property division on dissolution of domestic partnership is appropriate where the parties’ intent to share assets and expenses is shown by evidence that they have jointly purchased, built, or maintained property, held joint accounts, and made substantial economic and noneconomic contributions to the household for mutual benefit.” There cannot be an award of spousal support, nor can there be a claim for attorney fees made in such a proceeding.

                Here the court of appeals found that there was insufficient evidence of financial commingling sufficient to support Baker’s claim of the existence of a domestic partnership.

                Even though a party has no entitlement to attorney fees in this form of proceeding, if the other party files a frivolous case then the offended party can seek sanctions under Oregon Rule of Civil Procedure 17.   The court of appeals did not reach the issue of whether the filing was in fact frivolous, because it decided that the trial court’s manner of assessing sanctions was legally improper.  The matter was remanded to the trial court to decide if sanctions were warranted under ORCP 17.

As a Portland Oregon divorce law firm, Stephens Margolin P.C. is dedicated to keeping up to date on Oregon Court of Appeals and Oregon Supreme Court opinions.  As a service of The Oregon Divorce Blog, we will be providing updates as new opinions come out.

On February 11, 2009, the Oregon Court of Appeals published an opinion in Branam and Beaver.  The case is an appeal from a trial court ruling on the division of assets in a long term domestic partnership.  The main question before the court was how to divide the proceeds from the sale of the parties’ home.

Beaver and Branam are a man and woman who lived together in a domestic partnership but never married. Branam had received an inheritance from her former husband. She used part of the money to buy a house. The parties never discussed what would happen if they decided to separate. When Beaver moved into the house, Branam agreed to put his name on the house. Beaver argued that this meant that he owned half the house and should receive half of the equity in the house after they broke up. Beaver said that she never intended for him to receive the money originally paid for the house and that she added his name as a way to insure that he could live in the house if she died.  The parties sold the house and the trial court decided to award half of the apprectiation of the value of the house to each party and to award 100% of the original value to Branam.  On appeal, Beaver contends that the court erred in reimbursing the purchase price to Branam.

In its opinion, the court of appeals explainst that Oregon law, based on the court of appeals’ ruling in Beal and Beal and that case’s progeny, provides that, in the dissolution of a domestic partnership, courts are required to divide property according to the express or implied intent of the parties at the time that they established their partnership. If the court cannot discern the parties’ intent, the court may exercise its equitable powers to reach a fair dissolution of the parties’ partnership. How the parties held legal title to real property is evidence of the parties’ intent, but it is not dispositive. Where there is no express agreement of the parties regarding the division of their property in the event of dissolution of their domestic partnership, “courts should closely examine the facts in evidence to determine what the parties implicitly agreed upon.” Beal, 282 Or at 122. The court then looks at the following factors to determine the intent of the parties: 1. Inferences drawn from the way the parties lived; 2. The fact of cohabitation can be evidence of an intent to share incomes during the time the parties live together; and 3. Joint acts of a financial nature (joint checking account, joint savings account, joint purchases, etc…) may give rise to an inference of a intention to share equally. Where the evidence establishes that parties in a domestic partnership intend to share property equally but one party makes a greater initial contribution to the property, the property will be divided equally but the party making the greater initial contribution will be credited for that contribution.

In this case, since there was no evidence that the parties intended to split the initial contribution made by Branam, it was proper for the court to split the appreciation in the property equally, but to award the initial purchase price to Branam.

The entire opinion can be found at http://www.publications.ojd.state.or.us/A133414.htm.

The case teaches us that unmarried couples who intend to share their financial lives would be well advised to set forth their intentions in a formal document.  If not, the court will decide for them how to split up their possessions and finances when they break up.

The lawyers, including Daniel Margolin, who focuses part of his pratice on family law appeals, at Stephens Margolin P.C. can assist parties going through the dissolution of a domestic partnerhip or who want information on dometic partnership agreements and in better understanding the law in Oregon regarding divorce. If you have any questions about Oregon appellate law please contact Daniel Margolin or C. Sean Stephens at Stephens Margolin P.C.

Let’s start with what seems like the easy part: what are domestic partnerships? Under OFFA, same-sex couples over 18 may register as partners. However, heterosexual couples may not register as partners (primarily because they already have the ability to receive these benefits through marriage). Because the Oregon Constitution limits marriage to heterosexual couples, a separate mechanism for uniting families was required. (Check out the Basic Rights Oregon website for a wonderful guide to the legislation.)

But what are these automatic rights married couples get that unmarried and unregistered domestic partners don’t have?

Some rights are obvious: for example, to make medical decisions for a partner when the partner is unable to make those decisions him or herself or to automatically inherit property if a partner dies without a will. Others aren’t as obvious, like the ability to claim wrongful death benefits or crime victim survivor benefits if a partner is killed.

Some rights are provided by the state, like the automatic inheritance of a partner or how custody would be determined in a partnership dissolution, because inheritance and family laws are set by the state. Other rights are federal, like the ability to file jointly on federal income taxes. Oregon’s domestic partnership law can only affect state-provided rights. Subsection 9 of the legislation provides that “any privilege, immunity, right or ben3efit granted by statute, administrative or court rule, policy, common law or any other law to an individual because the individual is or was married….is granted on equivalent terms, substantive and procedural, to an individual because the individual is or was in a domestic partnership…”

It doesn’t get more equal than that in Oregon, save in name alone. Additionally, registered partners also have all the same responsibilities as married couples!

But since this is a legal blog, we’re mostly concerned about the juicy bits – those rights dealing with estate planning, wrongful death claims, adoptions, custody, and, of course, dissolution of the partnership.

But first, a little history. Some readers might be surprised to learn that domestic partnerships in family law courts aren’t new in Oregon. In fact, Oregon family law courts have dissolved an increasing number of heterosexual domestic partnerships. In doing so, the court would look back and determine whether or not the parties actually intended to form a domestic partnership: even though these are relationship dissolutions, frequently one party argues it was not a partnership (usually the party with assets) and the other argues that it was (usually the party with fewer assets). To find out what the parties intended, the court uses a test usually used in the context of business partnerships – did the parties intend to pool resources and share liabilities? If the answer is yes, then the court tries to find an equitable way to divvy up the parties’ resources. If no, then the parties keep their separate property.

Sounds easy, right? But it’s not. The court can’t order spousal support. Custody of children is very complex, because for a non-biological parent to receive custody or visitation, another action must be filed (although in fairness, it may be joined to the dissolution of domestic partnership action). Basically, in the absence of a clear statute, the family law court exercises its equity powers — basically, whatever the court thinks is fair on that day. This means results can vary even more widely than they can with the assistance of statutes.

What OFFA does for same-sex couples is give the court all of the well-developed tools the legislature has enacted over the years for the dissolution of marriage cases, as well as providing more options for determining custody of children in a partnership dissolution. (If you want to know just how busy the legislature has been in developing and honing those family laws, take a gander at ORS 107 and ORS 109!)

We hope domestic partnerships thrive. However, if you have registered a partnership and wish to dissolve it, think carefully about your next steps and consult with an attorney well versed in dissolution of marriage procedures. Due to the sensitivity of the subject matter, don’t be shy about asking your attorney what he or she thinks of your lifestyle. It does matter. It’s important that there be an open and trusting atmosphere in your dealings with your dissolution attorney.

*Although states are supposed to give each other’s laws “full faith and credit” under the US Constitution – and this includes honoring marriages – states do not have to do so when another state’s laws violate public policy in that state. This was, generally, the way the law was practiced before the enaction of the so-called “Defense of Marriage Act” (or DOMA) in 1996, but it’s now the law of the land. So, for example, if a couple marries at the age of 14, and that is legal in the state in which they reside, but is illegal in another state, the question of the marriage’s validity in the second state is up for grabs, depending on the policy implication of 14 year olds marrying. If thinking about this makes your head hurt, you’re not alone: the topic of marriages alone took up weeks in my Conflicts of Law class.