This is a good example of why it’s important to carefully review retirement accounts when determining a divorce settlement.

According to court records, husband and wife married in 1993 and had one child together. After 20 years of marriage, wife filed a petition for divorce.more

At that time, the child was leaving for college and was considered emancipated, so there was no need to work out a child custody or support arrangement.

Among the marital assets that needed divvied up were three vested retirement accounts: A Military pension, a Civil Service Pension and a Thrift Savings Plan. The two parties presented expert witnesses that offered conflicting valuations of those accounts.

According to the husband’s expert, the military pension was valued at $265,500, the thrift pension was valued at $311,200 and the civil pension was valued at $290,000.

Both sides did agree that 62 percent of the civil and thrift accounts were earned during the marriage and 36 percent of the military pension was earned during the marriage. The rest of those accounts were earned by the husband before the couple married, and thus they were set aside and not considered marital assets for consideration in the Indiana divorce settlement.

The court adopted the husband’s calculation of the account values, awarding wife 15.5 percent of each the thrift and civil accounts and 9 percent of the military pension account. Husband was ordered to pay $52,000 on top of that as part of an equalization judgment. The order did not mention survivor benefits, should the husband die first. The court also ordered both parties to pay their own respective attorney fees.

Wife appealed, arguing the calculations of her share of the retirement accounts were incorrect and also challenging the decisions not to award her survivor benefits or attorney fees.

Specifically, wife contended the court improperly applied the coverture fraction. This is a formula that a trial court can use to distribute retirement plan benefits or pensions from the earning spouse to the non-earning spouse. This method involves taking the value of the retirement account and multiplying it by a fraction (based on the period of time during which the marriage lasted).

The problem was the coverture fraction method was applied incorrectly, she argued – and the Indiana Court of Appeals agreed.

For example, with regard to the civil and thrift plans, where 62 percent of the plans were considered marital assets. By dividing this 50/50, as the courts had decided to do, the wife should have received 31 percent – not 15.5 percent. The court had in effect divided the amount twice, instead of just once. Under the court’s calculation, she was awarded just one-fourth of the two-thirds that had accrued during the marriage, when in fact, she was entitled to one-half of the two-thirds.

The same issue was raised with regard to the military pension, of which she was entitled to 18 percent – not 9 percent.

Ultimately, that means wife was entitled to $116,000 more than what trial court awarded to her.

However, with regard to attorney fees and survivor benefits, the appeals court found the trial court acted appropriately within its discretion.

Indiana Family Law Attorney Burton A. Padove handles divorce and child custody matters throughout northern Indiana, including Gary and Hammond.

Additional Resources:

Ahls v. Ahls, March 11, 2016, Indiana Court of Appeals

More Blog Entries:

Carr v. Carr – Survivor Benefit is Marital Asset, Indiana Appeals Court Rules, Feb. 20, 2016, Hammond Divorce Lawyer Blog

That was the ruling handed down by the Indiana Court of Appeals in the recent case of In Re: the Marriage of Carr v. Carr.

This was a couple who had been married for 16 years and had two children together when the husband sought a divorce. For 14 years before the pair were married, husband had worked in the military, and his service continued while the pair were together. Prior to their marriage, the husband had begun building up his pension. During the marriage, that pension grew. He’d also earned a pension prior to the marriage from a private company.more

While the two were married, both made substantial contributions to the acquisition of marital assets, though husband’s contributions were more financial while wife’s were more non-economic.

Husband filed for divorce in Indiana while he was deployed overseas. He expected when he returned to leave the military and find a job that paid less, but his earning capacity still far outpaced his soon-to-be-ex-wife’s.

The pair agreed on most issues – including the parenting time schedule with the kids. However, they could not agree over the value and treatment of husband’s civilian and military pensions. An expert was hired to calculate the value of these assets. He determined the survivor benefit wife would earn if husband died was $2,750 a month or $226,500 total. The total amount that could be earned under the pension was $1.2 million.

Wife countered this by pointing out that her non-economic contributions to the marriage allowed her husband to stay in the military and if he’d not been able to do so, he would have no pension. She stated she counseled him to maximize his retirement benefits, and therefore she should be entitled to half of the $1.2 million.

Wife received half of the total military pension’s present value, which was $315,500.

There was dispute between parties about whether this should be considered a “marital asset.” If it was, wife would be entitled to fewer other assets in an equitable distribution arrangement. Wife pointed out – and trial court agreed – there was no guarantee she would ever collect survivors’ benefits because she would have to live longer than him to do so. Accordingly, the court didn’t count the survivor benefits as a marital asset. Ultimately, she was awarded more than $800,000 of a total marital estate of more than $1.3 million.

Husband appealed, arguing the survivor benefit plan should have been counted as a marital asset.

The appellate court agreed. Justices noted that actually, this benefit to the other spouse because it creates an incentive for the pension-earner to secure a survivor benefit plan in the first place.

The court ordered that the case be remanded to the trial court to either justify the 65/35 split of assets, or to conform it to the 60/40 split that resulted when the survivor benefit plan was added to the marital pot for distribution of assets.

Indiana Family Law Attorney Burton A. Padove handles divorce and child custody matters throughout northern Indiana, including Gary and Hammond.

Additional Resources:

In Re: the Marriage of Carr v. Carr , Jan. 27, 2016, Indiana Court of Appeals

More Blog Entries:

Gertiser v. Gertiser – Indiana Supreme Court Weighs Spousal Maintenance, Dec. 20, 2016, Hammond Divorce Lawyer Blog

Researchers analyzed a longitudinal study of more than 10,000 people – and some of their siblings – beginning in 1957. From this group, study authors identified 190 parents of biological children with developmental disabilities, as compared to 7,250 parents of children without disabilities. What they discovered was that the rate of divorce was about the same for both groups – 1 in 5. However, for parents of children with no developmental issues, risks of divorce were lowest with just one child, and increased with each subsequent child. This was not true though for parents of children with disabilities.

What this suggests is that other children may provide an important support and coping system in caring for a developmentally disabled child, researchers say. more

However, there have been previous studies to suggest divorce rates are higher for parents of older children and adolescents with specific conditions, like autism. Researchers at the University of Wisconsin-Madison found that parents of children with autism had a 24 percent chance of divorcing, compared to other parents, who faced a 14 percent chance of divorce.

Many times, parents of special needs children face intense daily demands, and the marital relationship isn’t the primary focus. That can have long-term implications.

In these situations, the decisions that must be made and the specifics of the Indiana divorce agreement can be more complex because it must take into account the needs and responsibilities for that child. Courts will look closely at the best interests of the child. There is no singular definition to that term, as it’s taken on a case-by-case basis.

Depending on the nature and scope of the disability, the American Bar Association has identified issues that may need to be addressed to ensure the child’s needs and best interests are met and advanced include:

• Visitation arrangements
• Educational decision-making
• Transition between homes
• Medical and health care needs
• Therapy and support services needs
• Childcare arrangements and costs
• Health insurance coverage

Occasionally, it happens that both parents agree on these issues, and all that’s necessary is for the court to formalize that agreement. However, in many cases, parents may disagree on the right approach or the amount of parenting time or the level of involvement in critical education and health care decisions.

It’s important that the final divorce decree be clear with regard to things like how decisions will be shared and how parents will resolve issues when they come to an impasse. This will help to ensure that necessary services to the child won’t be delayed any longer than necessary.

As the children get older, parents should have some outline of how they plan to work together to explore further education, training, employment, independent living and other goals. Children with special needs need both of their parents just as much after the divorce. Working out a plan that is flexible but clear is important.

In cases where disabilities are severe, parents may need to discuss elements such as estate planning, Social Security benefits for the child and all available health benefit resources.

For many of these families, co-parenting will be a lifelong endeavor. Both parents should ensure they are adequately represented.

Indiana Family Law Attorney Burton A. Padove handles divorce and child custody matters throughout northern Indiana, including Gary and Hammond.

Additional Resources:

The Relative Risk of Divorce in Parents of Children With Developmental Disabilities: Impacts of Lifelong Parenting, November 2015, American Association on Intellectual and Developmental Disabilities

More Blog Entries:

Carmer v. Carmer – Prenuptial Agreements, Personal Injury Annuities and Property Division, Nov. 20, 2015, Hammond Divorce Attorney Blog

Marital property is that which is acquired during marriage, while separate property is what a spouse owns prior to marriage or acquires by gift or inheritance during the marriage. Even so, a judge has the discretion to divide the couple’s property in any way that seems fair, regardless of when it was acquired or who actually owns it. Commingling happens when separate and marital property is mixed.

Factors that may be considered when dividing a couple’s property unequally would be:

• Economic situation of each spouse;
• Each spouse’s current earnings or earning potential;
• Conduct that resulted in dissipation or loss of property;
• Each spouse’s contributions to property acquisition or income.

more

In the recent case of Dant v. Dant before the Indiana Court of Appeals, division of property was at issue. Wife appealed trial court’s award of 69 percent of net marital estate to husband, while granting her just 31 percent. Trial court stated that when it excluded assets husband had prior to marriage, the division was approximately 53 percent to him and 47 percent to her.

Although wife presented much evidence refuting the findings of the trial court, the appeals court noted it could not reweigh or consider new evidence. It could only review for abuse of discretion, and it found none.

According to court records, the pair were married in 1991 and filed for Indiana divorce in 2014. Prior to marriage, husband worked as a sheriff’s deputy and, from 2003 through 2010, served as a local elected sheriff. During this time, he earned about $85,000 annually. However, after he was not re-elected, his salary dropped to $32,000 and later to $28,000 while serving as a patrol deputy. That was still his occupation/pay grade at the time of the divorce.

Wife worked for a large auto manufacturing firm, and has consistently earned about $100,000 annually since 1992.

Husband had a pension plan valued at $1.1 million, and he was drawing $5,000 a month from it at the time of divorce. He also had other retirement accounts valued at a total $119,000. Wife’s retirement plan was valued at a total of $410,000. Additionally, the pair owned four parcels of rel estate, including the marital residence.

In dividing the property, the court awarded wife the marital property and one other, while awarding husband the two remaining. The ultimate division was unequal, but that doesn’t necessarily mean it was unfair.

It’s important for those in the midst of a divorce to make sure they have adequate legal representation because it’s difficult to have such decisions reversed at the appellate level. The appeals court has held that division of marital property is within the sound discretion of the trial court, which means the only way to reverse is for abuse of discretion. This occurs when:

• Decision was clearly against logic and effect of the facts and circumstances;
• Trial court misinterpreted the law
• Decision discharged evidence of factors listed in controlling statutes.

Even when there are reasonable inferences and facts that could lead to a different conclusion, the appellate court isn’t going to substitute its judgment for that of the trial court. There is a strong presumption faced by the appellant that trial court complied with statute. Even in cases where one or more findings is clearly erroneous, the appeals court can affirm if the judgment is supported by other findings or evidence on record.

Here, court acknowledged wife’s monetary and non-monetary contributions to the marriage, but there is no legal authority that says the court had to assume those contributions were expressly for the husband’s benefit. Further, the court did not find an abuse of discretion regarding trial court’s award of two properties to the husband, even in light of wife’s ample evidence that one of those properties was purchased by the couple during the marriage. Appeals court declined to reweigh the evidence.

Indiana Family Law Attorney Burton A. Padove handles divorce and child custody matters throughout northern Indiana, including Gary and Hammond.

Additional Resources:

Dant v. Dant , Oct. 30, 2015, Indiana Court of Appeals

More Blog Entries:

Stekr v. Beecham – Deviation from Child Support Guidelines, Oct. 25, 2015, Hammond Divorce Lawyer Blog