Category Archives: Family Law

Family Law – Interpreting Antenuptial Agreements in Minnesota

The Minnesota Court of Appeals recently addressed antenuptial agreements in Peterson v. Deeb, A13-2259 (Apr. 27, 2015).  As opposed to the more well-known “prenuptial agreement,” antenuptial agreements are made between partners after they are already married. The details agreed to in the contract are typically the same as those in prenuptial agreements, including property division, support, and similar matter.


Minnesota courts have long recognized antenuptial agreements, which change the statutory provisions for dividing both marital and nonmarital property when marriages are dissolved. Minnesota Statute Section 519.11 codifies the state law on antenuptial agreements.  Agreements are enforceable if the parties provide each other with a full and fair disclosure of their assets and income and the parties have the opportunity to consult with independent legal counsel of their own choice.  When these two requirements are met, the party who challenges the agreement has the burden of proof to show that the agreement was invalid.


New MN Family Law Case


In this case, the wife had been the sole owner of the parties’ home before the marriage; her equity was $75,000.  There was no dispute that the parties disclosed all of their assets and were represented separately by independent counsel throughout the negotiations and drafting of the agreement.  Under the terms of the agreement, the wife retained her $75,000 nonmarital interest in the home, but the parties agreed that any future increase in value would be considered marital property.  Thus, within 30 days after the marriage ended, the homestead was to be transferred into joint tenancy, with both parties as obligors of the mortgage.


After the antenuptial agreement was signed, the parties refinanced the homestead and used that money to purchase a cabin.  The district court found that the parties’ equity in the homestead, including both marital and nonmarital assets, had been eliminated by both the refinancing and by a decline in market value.  Thus, the district court found that selling the parties’ cabin and other real property would enable them to pay each for their nonmarital contributions to the purchase of these assets.  However, the district court awarded the wife $75,000, her interest in the homestead protected in the antenuptial agreement, and the husband was awarded $15,417 for his nonmarital contribution.


Points of Contention


In this case, the issue was the interpretation of the agreement, not the validity of the antenuptial agreement itself. The district court rejected the husband’s argument that the wife’s nonmarital interest of $75,000 was eliminated when the parties refinanced the homestead and its value decreased.  The Court of Appeal upheld the district court ruling.


In reviewing that lower court decision, the Court of Appeals noted that the purpose of contract interpretation is “to give effect to the parties’ intent,” and that a court should “avoid any interpretation that would make a contractual provision meaningless.” The Court of Appeals found that the “overriding purpose and intent of the parties” was to protect each party’s nonmarital party in the event the marriage was dissolved, including both the wife’s $75,000 in equity and the husband’s separate bank account.  The agreement itself did not indicate that purchasing other assets with non marital funds or commingling marital and nonmarital property would result in the marital property being eliminated.


The district court held (and the Appeals Court agreed) that the husband’s interpretation, which would eliminate the wife’s nonmarital asset, was “unconscionable” and unfair.   The Appeals Court also found that the district court’s enforcement of the agreement was fair and equitable.  When the parties married, their only real estate asset was the wife’s $75,000 in equity.  When they divorced, more than twelve years later, their equity had increased to $235,000, so the wife’s nonmarital asset ($75,000) was now only 31.9% of the parties’ total equity.  After the awards to each party of their nonmarital assets, 61.5% of the equity remained to be distributed as marital property.   Thus, the parties had obtained a significant increase in their joint assets during the course of the marriage.


Get Legal Help
This case illustrates the importance of obtaining legal counsel whenever an antenuptial agreement is considered.  For questions about these or any other Minnesota family law issues, be sure to seek out the aid of an experienced family law attorney for tailored guidance.


In Arnold v. Arnold, A14-1097 (Minn. Ct. App. Apr. 27, 2015), the Court of Appeals upheld an order for protection (OFP) although the husband argued that the wife was not presently being harmed, finding that the district court could infer a present intent to commit domestic abuse based on the totality of the circumstances.  The abuser’s past behavior may be considered, but it is not dispositive.


The Family Law Case

Minnesota’s Domestic Abuse Act, Minn. Stat. Section 518B.01, allows a family member to petition for an OFP in case of domestic abuse.  The statute defines domestic abuse as:  “(1) physical harm, bodily injury, or assault; (2) the infliction of fear of imminent physical harm, bodily injury, or assault; or (3) terroristic threats, criminal sexual conduct, or interference with an emergency call.”   518B.01, subd. 2(a).  To find domestic abuse, there must be a showing of present harm or an intention to do present harm.  The Act is remedial and, therefore, intended to protect domestic abuse victims, not to punish the abusers.

In Arnold, the court found three separate abusive acts occurred on the same day, December 21st.    First, he put his hand in the shape of a gun against her temple, making the sound of the gun and yelling a curse at her, and poked her with his fingertips and caused pain which the court found was both   (1) physical harm, bodily injury or assault and (2) the infliction of fear of imminent physical harm, bodily injury or assault.  Second, he threw a vase at her although it hit the wall; the court found that was (2) the infliction of fear of imminent physical harm, bodily injury, or assault.  Third, when his wife tried to call 911, he grabbed the phone out of her hands; the court found that was (3) interference with an emergency call.

The huRow of law books on shelfsband argued that subsequent events showed she was not afraid of him and, even if she was afraid, her fear was unreasonable.  He noted that he had petitioned for divorce, and they exchanged text messages.  The Minnesota Court of Appeals noted that it accords great deference to the district court’s determinations regarding credibility, and the district court had found the wife’s testimony credible, noting text messages with her mother from the time in question.

The court also found that the four-month span between the events in question and the wife’s filing for the order of protection was an insufficient gap to weigh against an OFP.  The court noted that a two-year gap between an incident of domestic abuse and filing for an order for protection is a long passage of time that may weigh against an order of protection, a four-month span of time is not so remote.   Therefore, the court upheld the order for protection.

This case does suggest that it is a good idea to pursue an order for protection quickly. It is always best to promptly petition for an order of protection rather than waiting months or years to file. As in most legal arenas, timeliness is in your best interests.

If you need an order for protection or someone has sought an order of protection against you in our area, you may want to consider consulting an experienced Woodbury family law attorney today.

How to Help Your Children When You Separate or Divorce

For people who are childless, divorce is relatively straightforward; once they are divorced, they never have to see each other again.  But when people have children, they are bound together for life in some ways, regardless of their marital status. They also have to worry about the third parties to the separation and divorce, their children.  It is critical to focus on what is best for the children.  In addition, if you are ever in litigation with your ex-spouse, having a record of having acted in the best interest of your children will serve you well).

HelpGuide has a great guide on helping children of any age cope with separation and divorce.  The Mayo Clinic also has a good discussion of this topic. Parents can help their children by providing stability and reassurance to the children.  Remember, that your children’s needs come first, and they need to feel loved by both their parents, and they usually want both parents to remain an important part of their life.   They also need to know that the separation or divorce was a grown-up decision that had nothing to do with them.

You may not be married anymore, but you are parenting partners for life

You need to take the long view.  If your children are young, you and your spouse, or a court, will get to decide how much time each parent has with the child.  However, once they are adults, they will get to decide how much, if any, time they spend with their parents.  If you nurture a warm loving relationship with your children, you may be invited to share their lives.

Also, no matter how bitter and unhappy you and your ex are now, you will likely come together for family events for the rest of your lives.  If your children are young, there will be school events and extracurricular events where both parents are invited.  As children get older, there will be graduations, and possibly weddings and grandchildren.  Will you be together for the children’s birthdays or will you celebrate them separately? Will you alternate Christmas and Thanksgiving?

Sad child in front of arguing parentsBecause parental conflict can be traumatic for children, it is best if you and your spouse can form a partnership, working together for the best interest of the school.  Otherwise, your children may learn to manipulate you and play one parent against the other.  You will need to bite your tongue and not say anything derogatory about your ex to your child; your relationship with your ex is your decision, but your children love both parents and need both parents in their lives (unless one parent has been abusive either to you or to the children – that’s a different situation).

If tensions are high with your ex, see if you can arrange drop-offs and pick-ups so that you do not need to see each other.  Today, you can handle arrangements with a Google calendar and communicate by texting or email, reducing the opportunities for person contact.  Do not confide problems with your ex to your children.  You will need to develop other friends that you can confide in.

Telling children about the news about the big change

You and your ex need to think carefully about how you will explain this change in your lives.  You should do the best you can to be on the same page, and anticipate what will be of most concern for your children.  They will want to know where they will live and when they will see both parents.  If they are teens, they will want to spend time with their friends as well as with their parents.   Ideally, you would both sit down together with the children and explain what will happen.

  •       Tell them the truth, but remember you don’t have to tell them everything.  Be sure you let them know that while parents can fall out of love with each other, they can never stop loving their children.
  •       Tell them you love them.
  •       Share information about the logistics of their new life. Will they stay in their current home and school?  Will then need to move?  Will their parents share custody?  When will they see each parent?  What if they want to spend time with their friends?

Help your children grieve

For many children, a separation or a divorce is traumatic, a major change in their lives imposed by their parents.  You can help by giving your children choices, and by helping them grieve.  Be sure to listen to them and encourage them to express their feelings.  And acknowledge their feelings rather than dismiss them.

Stay connected to your children

Being the noncustodial parent can be painful, but it is important to stay in touch with your children.  Technology has made it so much easier to stay in touch; even if you live far away, you can Skype regularly and call.  Sometimes its useful for even young children to have their own telephone, so parents can contact them directly.

If you need legal help with any family law matter in Minnesota, including custody issues, contact Arrigoni Law today.

The Divorce Process

Going through a divorce is a difficult, emotional time in most people’s lives. It also can be very expensive if you end up in protracted litigation,a trial,and an appeal. In the last five years the courts have tried to streamline the process by implementing an Early Case Management Program. The program is designed to encourage court intervention within three to four weeks of the filing of a case.

After a case is filed an Initial Case Management Conference (ICMC) is scheduled with the judge or referee that will be assigned to your case (except in Dakota County where you do not receive an assigned judge). This hearing is normally scheduled within a month after the filing of the case with the court. The purpose of the ICMC hearing is to meet your judicial officer and have his or her immediate input into the process and your case. Normally at this hearing the parties are barred from bringing any motions, but are required to submit some general financial data and other background information, including information about children, the issues, assets and income.

At the hearing the parties discuss Alternative Dispute Resolution (ADR) options such as Mediation, Social Early Neutral Evaluation (SENE) and Financial Early Neutral Evaluation (FENE). Normally it is mandatory for the parties to agree on a Mediator or a professional to conduct a SENE or FENE as part of the Alternative Dispute Resolution Process, which is required,except under a few exceptions. Discovery(the exchange of information) and scheduling issues are also discussed to establish deadlines to move the case forward. Prior to the Early Case Management process, often a party would not see a judge until a Temporary Hearing, which could take longer to schedule. This also would be an adversarial hearing right from the start to litigate temporary custody, temporary child support, temporary spousal maintenance,homestead possession, or temporary debt division

Most judges now require immediate ADR before the scheduling of a temporary hearing unless there is an emergency or unusual circumstances. This is designed to encourage ADR and lessen litigation with the hope that people can reach settlements without the destructive personal attacks and the expense and time on the court system for a temporary hearing.

Issues involving custody, parenting time, or the children are addressed in a Social ENE (SENE). All financial matters such as spousal maintenance, child support, property division, debts and attorney fees are addressed in a Financial Early Neutral Evaluation (FENE). Each county has a roster to select an evaluator.  The evaluators are highly experienced in that respective area of the law or in custody and parenting time issues. Normally it is expected and required the ENE will occur promptly and that both parties and their attorneys will be mandated to attend.

At the ENE meetings both sides present relevant facts, information and data or financial information about income, assets, debts or about custody and parenting and may be questioned by the evaluator about necessary information so they can provide an evaluative opinion about what a particular court may likely to do with their case as far as the likely outcome. This process is totally confidential and no information or recommendations made by the evaluator can be used or presented to the court at a later time. If a complete settlement is reached the parties can waive the confidentiality of the meeting and present the complete final settlement. Neither side has to accept the recommendation, but are encouraged to consider it to be used as a starting point to mediate or reach a compromise on the issues. Each county has a sliding fee schedule governing the costs and fees for an ENE.

If the parties are still unsuccessful in reaching a settlement the court is notified the process has been completed and a settlement has not been reached. The rules bar the parties, counsel or the evaluator from discussing what occurred at the ENE. The matter then moves forward and proceeds to a Pretrial and if still unsettled a Trial.

It is important to have experienced counsel to guide you through this process and prepare you for the ENE as well as assist with the selection of a quality Evaluator. Often times there are also negotiations that take place if either party rejects the Evaluator’s opinion and a party would benefit greatly by having the input of an experienced divorce lawyer.

Jeff is trained and serves as Early Neutral Evaluator for both a SENE and a FENE and is also a mediator and  Rule 114 Neutral.  With 31 years of experience as an attorney he can successfully guide you through the process.


Finding of Parental Alienation Leads Court to Modify Award of Custody

In Busch v. Christian, A14-0687 (Minn. Ct. App. Mar. 9, 2015), the Minnesota Court of Appeal upheld a decision of the trial court modifying a custody order to award sole legal and physical custody to a father because the mother had been alienating the child from the father.   In this case, the parents had never been married, but the father’s paternity was recognized soon after the child’s birth.  The initial child custody order had awarded both parties joint legal custody, with sole custody to the mother and parenting time to the father, increasing as the child got older.

Relying on Minnesota Statute section 518.18, the court found that four elements had to be established in order to modify a prior custody order:  (1) a change in the circumstances of the child or custodian; (2) modification would serve the child’s best interest; (3) the child’s physical or emotional health or emotional development is endangered by the current environment; and (4) the harm to the child likely to be caused by changing the environment is outweighed by the advantages of the change.   The court found that all four elements were met. books

The court found that there had been a sufficient change in the circumstances of the child or custodian to support modification of custody because the mother had constantly negatively referred to the father and refused as many as 29 days of parenting time since the last order and her actions caused the father’s relationship with his daughter to deteriorate.

The court found that modification was in the child’s best interests and provided a detailed analysis of the statutory factors.  The mother challenged the court’s conclusion on four of the factors.  First, the court found that the intimacy of the relationship of the parent and child favored the father, as he genuinely loved the child while the mother tried to alienate the child from the father.  The court was convinced that the mother had an unhealthy relationship with the child, noting that after the father had physical custody, the mother went to the child’s school every day to have lunch with her.  It was noted that the daughter was afraid to tell her mom that she loved her dad because of her mother’s constant negative state.

Second, the court found that the child’s adjustment to home, school, and community favored the father.  The court found that the child was better adjusted at school and with her peers after her father had custody.  It was again noted that the mother’s daily lunches with the child at school interfered with the child’s independence and were inappropriate.

Third, the court found that the continuity of a stable, satisfactory environment favored the father even though the child had lived for a longer period of time with the mother.  There was concerned that, since the change in custody to the father, the child was no longer sleeping in her own room but was sleeping with her mother when she had parenting time with her mother.

Fourth, the court found that the physical and mental health of the parents and child favored the father even though he had a recent DUI conviction because of the court’s concern that the mother because of the mother’s “persistent, uninterrupted and outrageous” interference with the father’s visitation.

It was also noted that the child had adjusted well to her father’s custody. And that she had improved in some significant aspects, including her hygiene.  Although she continued to have difficulties in school, the father had hired a tutor for her.

If you are involved in a custody dispute, you should consider retaining an experienced family law attorney who can assist you in developing a record that will support your claim for custody in light of the statutory factors.

Relocation of 6 Year Old Child Out of State Permitted and Child’s Preference Considered

In S.M.K.v.D.M.K.,A14-1070(Minn..App.March 2 2015) the court appeals affirmed a trial court decision permitting a mother to move and relocate the parties’ six year old child to Florida. The Court analyzed all the factors in Minnesota Statute 518.175,subd.3, and ruled the trial court did not abuse its discretion in finding the move was in the child’s best interest.

The father claimed it was ,in part, error to consider the six year old child’s desire to move to Florida.The court accepted mother’s assertion  that although the child is a young age, he has expressed a desire to move to Florida and understands he will see his father less, but wishes to continue to live with his mother and maternal grandparents. Father claimed it was error to accept mother’s claim without any inquiry due to possible manipulation by the mother. The Court of Appeals affirmed the trial court and accepted its finding that there was no evidence in the record to support that the minor child cannot comprehend the meaning of the move to Florida.

The court cited to Peterson v. Peterson, 394 N.W.2d 586,588(Minn.App.1986)(court accepts trial court’s ruling that a seven-year-old child could express a custodial preference)rev. denied(Minn.1986).

The court also rejected Father’s argument that the trial court erred by not awarding him 25% of parenting time, which is the minimum rebuttable presumption under Minnesota Statute 518.175,subd.1(g)(2014). Father claimed the court made no finding why 51 days a year is in the best interests of the child when he should have received 91 days a year. The court found since that argument was raised for the first time in the Motion for Amended Findings it was not properly before the court and the trial court acted within its extensive discretion in granting parenting time less than 25%.

Lastly father claimed the trial court court erred in making the parenting time subject to be agreed upon by the parties without a specific schedule,claiming this would be a cruel joke to try to work out the details of the parenting time, subject to the whim of the mother.The court noted to the extent practicable a court must include a specific schedule for parenting time,including the frequency and duration of visitation and visitation during holidays and vacations as required by Minnesota Statutes 518.175, subd.1(e)(2014).

The trial court ordered two periods of two weeks during the summer months as agreed upon by the parties,one week during the child’s winter break,every spring break,every other Thanksgiving and Christmas holiday, and two of the child’s long weekend breaks from school as set forth in the school calendar, as well as such other parenting time as mutually agreed upon. The Court of Appeals affirmed this schedule noting the father did not propose a specific parenting time schedule to the court and that if there were problems or issues he could seek relief from the trial court, and the schedule  was not an abuse of discretion.

Divorce Proceedings, the Death of a Spouse, and Marital Assets

Divorce Proceedings, the Death of a Spouse, and Marital Assets

In Nelson v. Nelson, A14-0200, (Minn. Ct. App. Oct. 6, 2014), the Minnesota Court of Appeals held that Minn. Stat. 518.58, subdivision 1a, which prohibits spouses contemplating divorce from transacting in or using marital assets so as to obtain a loss or profit without first getting consent from the other spouse’s consent, applies only to dissolution proceedings, and, therefore, do not apply when dissolution proceedings are terminated by a party’s death.

Nelson v. Nelson

In this case, the appellant, Kimberlee Nelson and her husband, Michael Nelson, were married in 1996. His will intentionally omitted his wife as a beneficiary of the estate. In 2007, he bought a life insurance policy with a million dollar benefit, naming his wife as the primary beneficiary, with the premiums being paid by his business. Then, in February 2012 he asked an attorney to prepare a joint petition and stipulation to dissolve his marriage to Kimberlee. Before he initiated the divorce proceedings, he changed the beneficiary of his life insurance policy to his parents and sister. After doing so, in May 2012 he served Kimberlee with a summons and petition for divorce. He died in September 2012, before the marriage could be dissolved.

After Michael died, his mother was appointed personal representative, and Kimberlee, his widow, asked for the rights of a surviving spouse despite the being excluded from her husband’s will, including homestead rights, a family allowance, household furnishings, and an elective share of his estate. She also brought a declaratory judgment action, claiming that the change of designated beneficiary of the life insurance policy constituted a transfer of marital assets in contemplation of divorce, which is barred by Minnesota Statute Section 518.58, subdivision 1a. The district court granted summary judgment to Michael’s parents and sister, and an appeal followed.

The Minnesota Court of Appeals affirmed the district court’s decision and held that the statutory prohibition on transferring assets did not apply in this case because there was no dissolution proceeding, as the husband died. The court held that the only remedy available under Section 518.58, subdivision 1a, is one imposed in a dissolution proceeding during the division of marital property. Thus, if one spouse has violated the provision, the court “may impute the entire value of an asset and a fair return on the asset to the party who transferred, encumbered, concealed, or disposed of it” in the dissolution proceeding. But, because Michael was dead, there was no dissolution proceeding available for a remedy. Under Minnesota law, when a party to a marriage dies during the pendency of a dissolution proceeding, the dissolution proceeding is terminated because the marriage, having been ended by death, no longer needs to be dissolved. Thus, when Michael died, his wife was his surviving spouse, and had no dissolution proceeding pending to obtain the requested relief.

The Minnesota Court of Appeals made clear that it frowns on “double-dipping,” namely using rights as a surviving spouse and as a party to a dissolution proceeding. Thus, Kimberlee was limited to her rights as a surviving spouse, and a spouse only vests in life insurance benefits if she is the beneficiary at the time of death.

Spousal Maintenance Extended Because Karon Waiver Was Ineffective without Specific Provisions in the Decree and Judgment

Spousal Maintenance Extended Because Karon Waiver Was Ineffective without Specific Provisions in the Decree and Judgment

In Hietpas v. Reed, A14-0105 (Minn. Ct. App. Dec. 8, 2014), the Minnesota Court of Appeals upheld a district court order modifying spousal maintenance because the judgment and decree did not have a proper Karon waiver. The parties had divorced in May 2008, and the agreement provided for spousal maintenance of $3,650 until Dec. 31, 2012, when maintenance was to end.   The agreement recited that the wife waived future maintenance after Dec. 31, 2012 based on a Karon waiver, the length of the marriage, and her ability to earn sufficient income to support herself and the minor children.

Requirements of a Karon Waiver

Because the courts have no jurisdiction to modify spousal maintenance when the parties execute a Karon waiver, the court first held that the decree did not include a proper Karon waiver.   There are four requirements for a valid Karon waiver:

  1. The stipulation includes a contractual waiver of the parties’ right to modify spousal maintenance.
  2. The stipulation expressly provides that the district court has been divested of jurisdiction over maintenance.
  3. The stipulation is incorporated into the final judgment and decree.
  4. The court has specifically found “that the stipulation is fair and equitable, is supported by consideration described in the findings, and that full disclosure of each party’s financial circumstances has occurred.”

The first two requirements, the contractual waiver and express language regarding jurisdiction, are required to divest the court of jurisdiction. In this case, there was no dispute that the judgment and decree included the contractual waiver; the problem was the absence of specific language in the decree stating that the court was divested of jurisdiction over future motions. Although the hearing on the agreement included testimony by the wife that she understood that the court would not have jurisdiction to entertain a motion to continue maintenance, the judgment and decree did not contain specific language regarding divestiture of jurisdiction or language incorporating the stipulation in court. Further, there were no specific findings that the agreement was fair and equitable. The court held that referencing the Karon waiver in the agreement was not sufficient because the Karon waiver limits the court’s jurisdiction as well as the party’s ability to modify the support order.

The Minnesota Court of Appeals also held that, given the parties’ extended conflict, the court did not abuse its discretion or lose jurisdiction by waiving the requirement that the parties engage in mediation.

Modification of Spousal Maintenance

The Court of Appeals also held that the district court did not abuse its discretion in modifying spousal maintenance. The parties had stipulated at the time of the divorce that the wife would be capable of earning at least $50,000 annually by the time maintenance ceased. The wife was an attorney, and she earned $48,400 in 2012, including eight months of employment in a position that she lost due to insufficient workload, unemployment insurance, and short-term work. She had applied for many jobs and had registered with four employment search organizations. The district court found she did not have the ability to earn the amount contemplated in the judgment and decree because of her difficulty both in finding work and, more significantly, keeping a job. The district court included that her potential annual income at the time of the motion was $32,597.

The Court of Appeals held that the district court did not err in finding that the wife’s mental health problems affected her ability to earn income even though the wife had testified that she lost her high paying job because of a lack of work, not her performance or mental health problem. It concluded that her testimony did not mean that her mental health problems had not prevented her from meeting her job’s billable hours requirement or finding another similar high-paying job.

It found that the wife’s income was more than 20% less than the $50,000 that had been estimated at the time of the divorce, and that amount created a presumption of a substantial change of circumstances, leading to a rebuttable presumption that the existing maintenance award was unfair. It held that the five-year extension of additional maintenance was supported by the record. It held that the district court did not abuse its discretion by failing to consider evidence that the wife had recently been hired for a $52,000 job, as it was not evidence that she would be able to sustain employment, which was her particular problem.

The Court of Appeals held that the district court did abuse its discretion by prohibiting the husband from bringing a motion to modify spousal maintenance for twelve months, as there could be many reasons under Minnesota law, Minnesota Statute Section 518A.39 subd. 2, why a motion to modify spousal maintenance would be appropriate other than a change in the wife’s income, including a change in the husband’s income.

This case illustrates the importance of having good legal advice in crafting an order and judgment dissolving a marriage. If you need a divorce or are considering a motion to modify an order and judgment dissolving a marriage, you may find it useful to consult with an experienced family law attorney.

Minnesota Court of Appeals Upholds Denial of Spousal Maintenance Award to Wife Who Is Receiving Disability Benefits

Minnesota Court of Appeals Upholds Denial of Spousal Maintenance Award to Wife Who Is Receiving Disability Benefits

In Rakow v. Rakow, A#14-281 (Minn. Ct. App. (Dec. 8, 2014)(unpublished), the Minnesota Court of Appeals affirmed a district court decision denying current spousal maintenance payments while reserving a future award to a wife who was receiving Social Security disability benefits due to a work-related injury, noting that the district court had awarded the wife a larger share of the couple’s property than the husband received. The couple had been married for ten years when the wife petitioned to dissolve the marriage and asked for permanent spousal maintenance, and they apparently did not have any children.


Spousal Support in Minnesota

The Court of Appeals noted that district courts have broad discretion in awarding spousal maintenance. Under Minnesota Statutes Section 518.003, subd. 3a, spousal maintenance “is an award of payments from the future income or earnings of one spouse for the support and maintenance of the other.” Further, under Minnesota Statute Section 518.552, subd. 1, a district court can award spousal maintenance to a spouse if she

  1. lacks sufficient property, including marital property apportioned to the spouse, to provide for reasonable needs of the spouse considering the standard of living established during the marriage, especially, but not limited to a period of training or education, or
  2. is unable to provide adequate self-support, after considering the standard of living established during the marriage and all relevant circumstances, through appropriate employment . . .

That statute, in subdivision B, sets out eight factors that should be considered, along with other relevant factors in awarding spousal maintenance:

  • the resources of the party seeking maintenance, including the property settlement and their ability to meet their needs;
  • the time to complete education and training to become self-sufficient and the likelihood, given the spouse’s age and skills, of becoming full or partially self-sufficient;S
  • the marital standard of living;
  • the length of the marriage and, in the case of a homemaker, the length of absence from employment and the extent to which earning capacity was diminished due to the time out of the workforce;
  • the loss of earnings, seniority, retirement benefits, and other employment opportunities forgone by the spouse seeking spousal maintenance;
  • the age, and the physical and emotional condition of the spouse seeking maintenance
  • the ability of the spouse who is being asked to pay maintenance to meet needs while also meeting the other spouse’s needs; and
  • each party’s contribution to the amount or value of marital property as well as a homemaker’s contribution to furthering the other party’s employment or business.

The Minnesota Court of Appeals found that the district court had adequately considered the relevant factors. In this case, while the wife had not worked at all since August 2012 and her doctor had not been released to work by her doctor, she was planning on back surgery in the next few months which could enable her to return to work. The court noted that she injured her back in a work-related injury and had not lost any income or employment opportunities because of her marriage, and she had worked until her injury.

Further, the court noted that the standard of living during the marriage was beyond the parties’ means, as they had incurred debt to maintain their standard of living, including mortgage debt, loans, and credit card debt.

The court noted that the wife’s monthly income was $1,373 while her monthly expenses totaled $3,108, leaving a deficit of $1,735. In comparison, the husband’s monthly income was $5,108.55 with reasonable monthly expenses of $5,146.68, for a deficit of $38.13. The court did not compare the parties’ post-divorce living expenses or compare them to the parties’ marital standard of living.

The court had taken into consideration the parties’ economic circumstances in crafting the property settlement. Thus, the wife was awarded the entire $14,575 in motor vehicle value and one half of the marital portion of the husband’s pension and his entire employment thrift savings plan, which was more than $20,000, while the husband was to be solely liable for the negative home equity balance, which was close to $70,000.

If the wife is unable to return to work, or she exhausts the property settlement, or her circumstances otherwise change, she would be able to petition for an award of spousal maintenance as the court did reserve the ability to make a future maintenance award.

In any case in which spousal maintenance is an issue, it is useful to consult with an attorney experienced in family law.

Non-Marital Property Becomes Marital Property when Commingled with Marital Property

Be Careful: Non-Marital Property Becomes Marital Property when Commingled with Marital Property

In Wallace v. Wallace, A13-2167 (Oct. 6, 2014), the Minnesota Court of Appeals held that non-marital property in bank accounts became marital property when the funds were commingled with marital property acquired during the marriage.

In this case, the wife asked that funds in a checking account and a savings account be awarded to her as non-marital property. Both accounts had belonged to her before the marriage. However, after she was married, she deposited her wages in the checking account and used the funds in that checking account to pay the couple’s monthly bills. She also made use of the funds in her savings account, by moving funds from the savings account to the checking account when needed to pay bills; she would then repay the savings account with her wages earned during the marriage.

The district court accepted the wife’s argument and awarded her $1,182.27 of the funds in the checking account and $20,076.91 of the funds in the savings account. The husband appealed.

The Minnesota Court of Appeals reversed the district court. The court noted that there is a rebuttable presumption that any property acquired by a married person during the marriage is marital property as well as a presumption that property acquired before the marriage is non-marital property. Minn. Stat. Section 518.003, subd. 3b. When a marriage is dissolved, the non-marital party goes to the party to whom it belongs while the marital party is divided equitably between the parties. Minn. Stat. Section 518.58, subd. 1.

Here, there was no dispute that the spouses commingled the marital property (the wife’s income during the marriage) with the non-marital property that she held before the marriage.   The wife argued that, looking at the balances of the accounts at the start of the marriage, the deposits, withdrawals, and balances at the end of the marriage, the non-marital property could be determined. The court rejected her argument, finding that the only way to maintain the non-marital character of the funds is either to maintain it in a separate account distinct from marital assets or to trace the funds by showing particular items of tangible property that were bought with non-marital funds.


How the Court Decided

The court relied on precedents that have held that commingling marital and non-marital funds converts all money in the account into marital property when the account is used for ordinary living expenses and the non-marital funds are not traced to a particular asset.

In order for non-marital assets to remain non-marital assets and belong solely to one spouse, the funds must either be segregated and not used for any marital expenses or must be used to purchase a tangible asset, enabling them to be traced to that asset. Thus, if non-marital assets are used to purchase (in full) a specific item, such as a valuable painting, that painting becomes a non-marital asset. But if the non-marital asset is used for living expenses, then it becomes a marital asset, in the absence of a premarital agreement.

Thus, the court held that all the funds in the accounts were marital property and, therefore, needed to be divided equitably.

In this case, the wife did not file a responsive brief to the Minnesota Court of Appeals. As this case illustrates, even if a party has won at the district court, if the case has been appealed, the party should file a brief in the appellate court. If you have any questions about preserving the non-marital character of your property, you should consult a family law attorney.