Litigation

The court, however, found little evidence that Kalinowski ever told anyone about the purported exchange of vows. Other evidence, including the fact that the couple did not have any joint assets or bank accounts and that the Jim Thorpe residence they shared was in Kalinowski's name alone, further suggested against a finding of marriage. In addition, the court rejected Contino's assertion that a presumption of marriage existed, explaining that because she chose to offer testimony on the specifics of her exchange of marital words with Kalinowski, she had waived application of the Dead Man's Act and, thus, was not entitled to the presumption. “Even if applied, the evidence of constant cohabitation, reputation of marriage, and wearing of matrimonial jewelry was not persuasive enough to establish a marriage,” the court wrote in the memorandum opinion.

According to the opinion, Kalinowski and Contino briefly lived together in 1979 while separated from their respective spouses. They later reconciled and resumed cohabitation in 1996. Both had divorced their prior spouses and secured annulments through the Catholic Church. According to Contino's testimony, the couple privately exchanged marital vows on Christmas Eve 1996. Although there were no witnesses to the exchange, Contino introduced two witnesses during a trial court hearing who testified that Contino had told them about the ceremony shortly afterward. Both witnesses were unclear of the year the ceremony took place, and Contino herself stumbled at first before recalling that the ceremony occurred in 1996, the opinion states.

Kalinowski's son, Joseph Jr., and his brother, Daniel, testified that their father had never mentioned exchanging vows with Contino. The opinion states that Joseph Jr. also expressed his belief, given his father's devotion to the Catholic Church, that he would only have remarried in the church. Although Contino offered a medical form, completed by Kalinowski in 1998, naming her as next of kin, the court noted that Kalinowski also designated his marital status as “single” on that form. Furthermore, all household bills were in Kalinowski's name, and there was no evidence that Kalinowski and Contino held any joint assets, despite their cohabitation. Moreover, Kalinowski “did not include [Contino] on his health insurance policy nor was she named as a beneficiary on his retirement plan or life insurance,” the court noted. “Similarly, [Contino] did not carry [Kalinowski] on her health insurance or list him as her husband on her retirement plan.” Contino asserted that the community regarded the couple as husband and wife and that a wedding band she wore was purchased in anticipation of the 1996 marital ceremony. The superior court, nevertheless, concluded that Contino's proof of marriage was lacking. In reaching this conclusion, the court panel questioned the credibility of the testimony presented by Contino and the two witnesses, just as the trial court had done. “[Contino's] testimony, the only first-hand account, is best characterized as vacillating,” the court said. “She initially stumbled regarding the year of the ceremony, then recalled it occurred in 1996. Her corroborating witnesses did little to assist in establishing a wedding date as neither could remember the year of the ceremony. Finally, close members of [Kalinowski's] family were never told about the wedding. [Contino] simply could not meet the heavy burden imposed on a putative spouse championing a common law marriage.” On the presumption of marriage claim, the court held that Contino's waiver of the Dead Man's Act barred her from employing such an assertion. The trial court had rejected Contino's presumption of marriage claim because she had acknowledged that her relationship with Kalinowski began meretriciously. Considering the issue on appeal, the superior court turned to the Pennsylvania Supreme Court's decision in Staudenmayer v. Staudenmayer, 714 A.2d 1016 (Pa. 1998), in which the high court recognized that the Dead Man's Act “could act as a barrier to a surviving party claiming common law marriage, thereby permitting application of the presumption.” In Kalinowski, however, “the parties waived application of the Dead Man's Act, and witnesses were permitted to testify regarding what [Kalinowski] said or believed regarding his marital status,” the court said. The court added that even if the presumption were applied, there was scant evidence to establish a marriage. “[Contino] was unable to prove that the meretricious nature of her cohabitation with [Kalinowski] changed in character,” the panel wrote. “Also, the understanding of three witnesses, called by [Contino], hardly equates to a general community-wide acknowledgement of [Kalinowski] and [Contino] as husband and wife.”

Courts Can Use QDROs to Satisfy Judgment for Arrearage In re Marriage of Thomas, No. 2-02-0302 Ill.Ct.App.

The parties were divorced in 1981 when their only child was 9 years old. The original settlement established the husband's support obligation at $800 per month. After 36 months, it would change to the greater of $650 a month or 35% of the husband's net income. It would drop to $200 when the child was emancipated or the wife remarried There were several hearings during 1999 through 2002, and the court finally entered a judgment for the wife for arrearage in maintenance and reimbursement for their son's educational expenses. It granted the wife leave to file a proposed Qualified Domestic Relations Order (QDRO) attaching the husband's pension and retirement accounts for the purpose of collecting the arrearage. The court granted the wife attorney's fees, and entered a QDRO affecting several of the husband's retirement plans.

The husband filed an appeal; the wife moved to dismiss, but the court denied her motion, turning to the merits of the appeal. It admonished the wife for failing to use discovery methods other than a notice to appear and concluded that the trial court should have admitted relevant evidence regarding the husband's net income. On remand it encouraged the parties to use all appropriate discovery tools to obtain and present the most accurate evidence of the husband's net income.

Most interesting, however, was the court's holding with regard to the use of QDROs to assign the husband's pension benefits to the wife in payment of the judgment. The court reviewed ERISA as it related to the state's Marriage Act. Pension trust benefits earned by an employee spouse while married are property under state law and therefore subject to division between the spouses upon retirement benefits through the use of QDROs that recognize an alternate payee all or part of the benefits payable under the plan. A case of first impression in Illinois, other states such as Missouri, Maryland and Ohio, have determined that ERISA authorizes courts to enter orders assigning retirement benefits to former spouses to satisfy support arrearages The court found that a spouse is not a typical creditor when it seeks the assignment of the plan participants' benefits after obtaining a judgment for maintenance and child support arrearage. Because maintenance and child support are considered more important values than pension benefits by the society, the Code of Civil Procedure did not preclude the court from assigning the husband's pension and retirement benefits to his former spouse. However, the wife was only entitled to an assignment up to the value of the retirement accounts at the time of the divorce. On remand, the trial court was instructed to utilize one or more QDROs to transfer the husband's pension or retirement benefits to the wife in payment of any arrearage.

Attorneys' Fees Have Non-Dischargeable Priority Status in Bankruptcy In re Malcolm C. Foster, Case No. 02-15524-8W3 Bkrtcy. M.D. Fla., April 28, 2003

The debtor's ex-husband objected to a priority claim filed by his ex-wife for attorneys' fees rendered in connection with their divorce. The court rejected his argument that it should be filed as a general unsecured claim, and overruled his objection. The final judgment for the dissolution of the marriage provided that the wife was entitled to payment of her attorneys' fees and that the husband was in a better position to pay them. Subsequently, the husband filed for bankruptcy and the court awarded the wife's attorney 65% of her fees to be paid over 5 years. The court reviewed the legislative history of priority claims for alimony, maintenance or support under ' 507 of the Bankruptcy Code. While he did not dispute that attorneys' fees are non-dischargeable, the debtor argued that such fees should not be placed in the same priority as alimony and support because they are not mentioned in the statute. He attempted to distinguish the numerous cases cited by the court holding that attorneys' fees are generally included within the non-dischargeable alimony or support claims. Those cases, he claimed, were decided under a different section of the Code and were not controlling. The court, however, reasoned that the language of the two sections was identical (with the exception of the last sentence) and that courts generally construe phrases with identical language as having the same meaning. In addition, the policy behind the two sections is the same: to allow a financially needy party to pursue his or her substantive claims by permitting the court to award fees and costs for the needy party to be paid by the party in superior economic position. The debtor's concerns about the wife's ability to punish him by running up a bill with her attorney were answered by the court's statutory duty to review the fee request and award on reasonable fees. The court concluded that the case law and policy rationale supported the decision to include attorneys' fee awards as support, then the decision is based on the relative financial needs of the parties and their ability to pay.

Court Awards Ex-Wife More Than $230,000 in Arrears Clarke v. Clarke, Docket No. A-1900-01T3 N.J. Super., App.Div., April 25, 2003.

After 29 years of marriage, Phyllis and George Clarke were divorced. George was supposed to pay $100 per week in alimony but he never paid, despite Phyllis' repeated attempts to collect. He left the state and then the country to sail around the world. At one point, Phyllis agreed to drop an outstanding warrant for payment of the arrearage in exchange for George' promise to pay it, but he never did so. Phyllis then hired investigators and asked her son to try to locate George, but was not successful. George secured a promise from his son and youngest daughter, Linda, not to reveal his whereabouts to Phyllis. He did not speak to his other daughter, who ultimately discovered his whereabouts, and told Phyllis that he was in Florida. Before Phyllis could file an action, George died, having transferred his assets to Linda. Phyllis filed an action against Linda for fraudulent transfer, and obtained an injunction preventing Linda from spending the money. Linda claimed that her sister and brother were forcing their mother to take this action in order to reach their father's money. Linda maintained that Phyllis had deteriorated mentally and did not need the alimony. In addition, she contended that Phyllis was precluded from asserting a claim to the money by reason of laches, waiver or estoppel. The trial court awarded arrears, interest and attorneys' fees. Linda appealed and the appellate court affirmed, except as to the attorneys' fees. The court reviewed the record and concluded there was adequate evidence that Phyllis had not delayed in her efforts to collect the money, that George had not changed his position in reliance on her conduct, and that Phyllis had not acted in any way that could be construed as a waiver. It was George who had acted in bad faith throughout, and the trial court had properly awarded the arrears. As to the attorneys' fees, however, the court failed to address the pertinent factors of the applicable rule. The appellate court reversed the award of attorneys' fees and remanded that portion of the case for reconsideration.

The publisher of this newsletter is not engaged in rendering legal, accounting, financial, investment advisory or other professional services, and this publication is not meant to constitute legal, accounting, financial, investment advisory or other professional advice. If legal, financial, investment advisory or other professional assistance is required, the services of a competent professional person should be sought.

Finding of Marriage Insufficient to Elect Against Will

In Re Estate of Joseph Kalinowski PICS Case No. 03-0605 (Pa. Super. April 24, 2003) Memorandum (11 pages)

Finding scarce evidence of a common law marriage, a Pennsylvania Superior Court panel ruled that the live-in companion of a deceased resident of Carbon County cannot elect against his last will and testament as a surviving spouse. Joseph Kalinowski died testate in November 2001, leaving his estate to his son, Joseph Kalinowski Jr. His live-in companion, Constance Contino, petitioned Carbon County Orphan's Court to elect to take against the will as Kalinowski's common law surviving spouse. She claimed that the two had privately exchanged marital vows in their living room in 1996.

The court, however, found little evidence that Kalinowski ever told anyone about the purported exchange of vows. Other evidence, including the fact that the couple did not have any joint assets or bank accounts and that the Jim Thorpe residence they shared was in Kalinowski's name alone, further suggested against a finding of marriage. In addition, the court rejected Contino's assertion that a presumption of marriage existed, explaining that because she chose to offer testimony on the specifics of her exchange of marital words with Kalinowski, she had waived application of the Dead Man's Act and, thus, was not entitled to the presumption. “Even if applied, the evidence of constant cohabitation, reputation of marriage, and wearing of matrimonial jewelry was not persuasive enough to establish a marriage,” the court wrote in the memorandum opinion.

According to the opinion, Kalinowski and Contino briefly lived together in 1979 while separated from their respective spouses. They later reconciled and resumed cohabitation in 1996. Both had divorced their prior spouses and secured annulments through the Catholic Church. According to Contino's testimony, the couple privately exchanged marital vows on Christmas Eve 1996. Although there were no witnesses to the exchange, Contino introduced two witnesses during a trial court hearing who testified that Contino had told them about the ceremony shortly afterward. Both witnesses were unclear of the year the ceremony took place, and Contino herself stumbled at first before recalling that the ceremony occurred in 1996, the opinion states.

Kalinowski's son, Joseph Jr., and his brother, Daniel, testified that their father had never mentioned exchanging vows with Contino. The opinion states that Joseph Jr. also expressed his belief, given his father's devotion to the Catholic Church, that he would only have remarried in the church. Although Contino offered a medical form, completed by Kalinowski in 1998, naming her as next of kin, the court noted that Kalinowski also designated his marital status as “single” on that form. Furthermore, all household bills were in Kalinowski's name, and there was no evidence that Kalinowski and Contino held any joint assets, despite their cohabitation. Moreover, Kalinowski “did not include [Contino] on his health insurance policy nor was she named as a beneficiary on his retirement plan or life insurance,” the court noted. “Similarly, [Contino] did not carry [Kalinowski] on her health insurance or list him as her husband on her retirement plan.” Contino asserted that the community regarded the couple as husband and wife and that a wedding band she wore was purchased in anticipation of the 1996 marital ceremony. The superior court, nevertheless, concluded that Contino's proof of marriage was lacking. In reaching this conclusion, the court panel questioned the credibility of the testimony presented by Contino and the two witnesses, just as the trial court had done. “[Contino's] testimony, the only first-hand account, is best characterized as vacillating,” the court said. “She initially stumbled regarding the year of the ceremony, then recalled it occurred in 1996. Her corroborating witnesses did little to assist in establishing a wedding date as neither could remember the year of the ceremony. Finally, close members of [Kalinowski's] family were never told about the wedding. [Contino] simply could not meet the heavy burden imposed on a putative spouse championing a common law marriage.” On the presumption of marriage claim, the court held that Contino's waiver of the Dead Man's Act barred her from employing such an assertion. The trial court had rejected Contino's presumption of marriage claim because she had acknowledged that her relationship with Kalinowski began meretriciously. Considering the issue on appeal, the superior court turned to the Pennsylvania Supreme Court's decision in Staudenmayer v. Staudenmayer, 714 A.2d 1016 (Pa. 1998), in which the high court recognized that the Dead Man's Act “could act as a barrier to a surviving party claiming common law marriage, thereby permitting application of the presumption.” In Kalinowski, however, “the parties waived application of the Dead Man's Act, and witnesses were permitted to testify regarding what [Kalinowski] said or believed regarding his marital status,” the court said. The court added that even if the presumption were applied, there was scant evidence to establish a marriage. “[Contino] was unable to prove that the meretricious nature of her cohabitation with [Kalinowski] changed in character,” the panel wrote. “Also, the understanding of three witnesses, called by [Contino], hardly equates to a general community-wide acknowledgement of [Kalinowski] and [Contino] as husband and wife.”

Courts Can Use QDROs to Satisfy Judgment for Arrearage In re Marriage of Thomas, No. 2-02-0302 Ill.Ct.App.

The parties were divorced in 1981 when their only child was 9 years old. The original settlement established the husband's support obligation at $800 per month. After 36 months, it would change to the greater of $650 a month or 35% of the husband's net income. It would drop to $200 when the child was emancipated or the wife remarried There were several hearings during 1999 through 2002, and the court finally entered a judgment for the wife for arrearage in maintenance and reimbursement for their son's educational expenses. It granted the wife leave to file a proposed Qualified Domestic Relations Order (QDRO) attaching the husband's pension and retirement accounts for the purpose of collecting the arrearage. The court granted the wife attorney's fees, and entered a QDRO affecting several of the husband's retirement plans.

The husband filed an appeal; the wife moved to dismiss, but the court denied her motion, turning to the merits of the appeal. It admonished the wife for failing to use discovery methods other than a notice to appear and concluded that the trial court should have admitted relevant evidence regarding the husband's net income. On remand it encouraged the parties to use all appropriate discovery tools to obtain and present the most accurate evidence of the husband's net income.

Most interesting, however, was the court's holding with regard to the use of QDROs to assign the husband's pension benefits to the wife in payment of the judgment. The court reviewed ERISA as it related to the state's Marriage Act. Pension trust benefits earned by an employee spouse while married are property under state law and therefore subject to division between the spouses upon retirement benefits through the use of QDROs that recognize an alternate payee all or part of the benefits payable under the plan. A case of first impression in Illinois, other states such as Missouri, Maryland and Ohio, have determined that ERISA authorizes courts to enter orders assigning retirement benefits to former spouses to satisfy support arrearages The court found that a spouse is not a typical creditor when it seeks the assignment of the plan participants' benefits after obtaining a judgment for maintenance and child support arrearage. Because maintenance and child support are considered more important values than pension benefits by the society, the Code of Civil Procedure did not preclude the court from assigning the husband's pension and retirement benefits to his former spouse. However, the wife was only entitled to an assignment up to the value of the retirement accounts at the time of the divorce. On remand, the trial court was instructed to utilize one or more QDROs to transfer the husband's pension or retirement benefits to the wife in payment of any arrearage.

Attorneys' Fees Have Non-Dischargeable Priority Status in Bankruptcy In re Malcolm C. Foster, Case No. 02-15524-8W3 Bkrtcy. M.D. Fla., April 28, 2003

The debtor's ex-husband objected to a priority claim filed by his ex-wife for attorneys' fees rendered in connection with their divorce. The court rejected his argument that it should be filed as a general unsecured claim, and overruled his objection. The final judgment for the dissolution of the marriage provided that the wife was entitled to payment of her attorneys' fees and that the husband was in a better position to pay them. Subsequently, the husband filed for bankruptcy and the court awarded the wife's attorney 65% of her fees to be paid over 5 years. The court reviewed the legislative history of priority claims for alimony, maintenance or support under ' 507 of the Bankruptcy Code. While he did not dispute that attorneys' fees are non-dischargeable, the debtor argued that such fees should not be placed in the same priority as alimony and support because they are not mentioned in the statute. He attempted to distinguish the numerous cases cited by the court holding that attorneys' fees are generally included within the non-dischargeable alimony or support claims. Those cases, he claimed, were decided under a different section of the Code and were not controlling. The court, however, reasoned that the language of the two sections was identical (with the exception of the last sentence) and that courts generally construe phrases with identical language as having the same meaning. In addition, the policy behind the two sections is the same: to allow a financially needy party to pursue his or her substantive claims by permitting the court to award fees and costs for the needy party to be paid by the party in superior economic position. The debtor's concerns about the wife's ability to punish him by running up a bill with her attorney were answered by the court's statutory duty to review the fee request and award on reasonable fees. The court concluded that the case law and policy rationale supported the decision to include attorneys' fee awards as support, then the decision is based on the relative financial needs of the parties and their ability to pay.

Court Awards Ex-Wife More Than $230,000 in Arrears Clarke v. Clarke, Docket No. A-1900-01T3 N.J. Super., App.Div., April 25, 2003.

After 29 years of marriage, Phyllis and George Clarke were divorced. George was supposed to pay $100 per week in alimony but he never paid, despite Phyllis' repeated attempts to collect. He left the state and then the country to sail around the world. At one point, Phyllis agreed to drop an outstanding warrant for payment of the arrearage in exchange for George' promise to pay it, but he never did so. Phyllis then hired investigators and asked her son to try to locate George, but was not successful. George secured a promise from his son and youngest daughter, Linda, not to reveal his whereabouts to Phyllis. He did not speak to his other daughter, who ultimately discovered his whereabouts, and told Phyllis that he was in Florida. Before Phyllis could file an action, George died, having transferred his assets to Linda. Phyllis filed an action against Linda for fraudulent transfer, and obtained an injunction preventing Linda from spending the money. Linda claimed that her sister and brother were forcing their mother to take this action in order to reach their father's money. Linda maintained that Phyllis had deteriorated mentally and did not need the alimony. In addition, she contended that Phyllis was precluded from asserting a claim to the money by reason of laches, waiver or estoppel. The trial court awarded arrears, interest and attorneys' fees. Linda appealed and the appellate court affirmed, except as to the attorneys' fees. The court reviewed the record and concluded there was adequate evidence that Phyllis had not delayed in her efforts to collect the money, that George had not changed his position in reliance on her conduct, and that Phyllis had not acted in any way that could be construed as a waiver. It was George who had acted in bad faith throughout, and the trial court had properly awarded the arrears. As to the attorneys' fees, however, the court failed to address the pertinent factors of the applicable rule. The appellate court reversed the award of attorneys' fees and remanded that portion of the case for reconsideration.

The publisher of this newsletter is not engaged in rendering legal, accounting, financial, investment advisory or other professional services, and this publication is not meant to constitute legal, accounting, financial, investment advisory or other professional advice. If legal, financial, investment advisory or other professional assistance is required, the services of a competent professional person should be sought.