Gislason & Hunter Law Blog

In Divorce Decrees, the Devil is in the Details

2013-05-13T14:05:19-07:00

Reading your divorce decree is not exactly a fun task. Not only is reviewing the document dissolving your marriage emotionally difficult for many people, the documents are usually full of "legalese" and not always drafted with any eye toward making the document easy to read. For complex cases, there may be more than one document to read of the parties agreed to "bifurcate" or deal with property issues separate from custody and parenting time, for example. Complex cases can result in divorce decrees that look like (and weigh as much as) a book when they are done.

It would be a big mistake to avoid reading and understanding these documents just because they are complex or picking them up causes a flood of emotions. These documents guide and direct much of your life going forward, whether it is when and how you must pick up and drop off your kids in the absence of an agreement with your ex-spouse or under what circumstances and when your ex-spouse has to chip in for unreimbursed medical expenses, you need to know and understand what your divorce decree actually says. If you don’t understand something, call your lawyer and have him or her explain it to you—preferably before you sign it.

Andrew M. Tatge is a partner and chair of the Family Law and Divorce Practice Group at Gislason & Hunter LLP (www.gislason.com). He regularly represents farmers, business owners, professionals, and other high earning and high net worth individuals (or their spouses) in divorce and related actions. Andrew can be reached at atatge@gislason.com or (507) 387-1115. This information is general in nature and should not be construed as tax or legal advice.

Workers’ Compensation, Independent Contractors and the Family Farm - An Unfair Trade from Bygone Days

2013-05-10T00:00:00-07:00

The Family Farm brings a certain image to the minds of those who grew up in the Mid-west before the farm crisis of the early 1980’s. However, our traditional visions of Mom, Dad, and the kids working the fields on a few hundred acres and having a couple of farm animals in the big red barn no longer match the reality of the modern farm. The modern farm operation more and more consists of thousands of acres of crops and/or thousands of head of livestock. These modern farm operations use many non-family workers to complete the heavy seasonal work around planting and harvest, as well as the maintenance and care of large herds of livestock. Despite this change in agriculture, the Minnesota Workers’ Compensation Act still operates under a tradeoff based on this old view of the family farm, a tradeoff which is no longer fair to the modern farm.

Really? The Judge Can Sell My Home?

2013-05-02T08:48:42-07:00

In Minnesota divorce cases, trial judges have significant power to determine when and how to award marital assets. Rarely are their decisions overturned on appeal.

Even before a divorce is final, judges have the power to permanently divide or dispose of marital assets. If a judge believes it is necessary to preserve marital assets, the judge can order a sale of the homestead (or sale of any other marital asset—including business interests, farm land, etc.) and can also dispose of the funds from that sale as the Court deems fair and just. The judge may also make a partial distribution of assets to one party or the other for good cause shown. “Good cause” is hard to define, but most judges would probably say that they know it when they see it.

Pre-decree sale and disposition statutes give judges the power to preserve assets, protect the parties’ interests, and otherwise "keep things fair" while a divorce case moves through the system. Of course, the parties are free to avoid judicial involvement and divide or protect their assets on their own, but to do so requires cooperation.

Reverification of Your Employee’s Work Authorization Status—The Second Coming of the I-9 Form

2013-04-02T09:00:00-07:00

Every employer who employs an individual who performs work inside the territorial boundaries of the United States must have a properly completed I-9 form for each of their employees on file during the course of their employment. Each employee must, after being offered a job and accepting it, complete Section One of an I-9 prior to performing any work for the employer. An employee must then, within three business days, provide sufficient original documentation to allow the employer to complete Section Two of the I-9. If the employee cannot provide such sufficient documentation, then the employee can no longer work until he or she does provide the sufficient documentation.

Should Your Company Consider Arbitration Agreements

2013-03-13T00:00:00-07:00

No business wants to be sued by an employee or former employee. It is expensive to defend employment lawsuits. In addition, such litigation is time consuming for management and may decrease company morale. There is a means by which employers can minimize employee lawsuits. Your company can require that employees sign arbitration agreements and thus waive their right to file lawsuits in certain situations when they have a dispute with their employers.

Warning to Agricultural Employers—Watch that Overtime Exemption

2013-03-06T12:00:00-08:00

The Minnesota Fair Labor Standards Act (MFLSA) contains a multitude of exemptions for agricultural employers from its overtime provisions. However, a recent Minnesota Court of Appeals case illustrates that while the state’s agricultural exemptions are fairly broad, their boundaries must be respected in practice. Failure to do to so can subject a farming operation to unexpected severe, liabilities, all caused by a failure to follow and respect the plain requirements of the exemptions.

"Divorce-Proof" Your Business Through Proper Business and Estate Planning

2013-03-01T08:27:00-08:00

Divorces happen. Even if your own marriage is rock solid, your life can be significantly impacted by the divorce of someone close to you, such as a business partner or a family member.

If you have completed your estate planning or are thinking about what you would like your estate plan to look like, think about the impact a divorce may have on your intended plan. If you intend to leave property to a child, but your Will names your child’s spouse also, that spouse may have a claim in your estate—even if your child and the spouse divorce.

Business co-owners may divorce too and it is important to have in place appropriate mechanisms to avoid your business partner’s spouse from having a say in the ongoing operation of the business. Buy-Sell Agreements, Antenuptial Agreements, and Postnuptial Agreements, along with approriate estate planning, is essential to minimize the risk of divorce impacting your assets, your business, your plan, or otherwise disrupting your life. And divorces do happen.

The Value of Expert Witnesses in Divorce

2013-02-14T08:44:00-08:00

Many time, a significant discussion needs to occur early on in a divorce case about the possible benefits of securing expert witnesses to help with the divorce.

In divorce cases, the expert witnesses needed may vary. Expert witnesses can include real estate appraisers, forensic accountants, business evaluation experts, and vocational experts, among many others. Many clients want to hold off on retaining expert witnesses and try and settle a case without them in order to avoid the cost. Sometimes that works; however, in a lot of divorces—especially those involving complex assets, significant income, or a high net worth—that is not the right move. This is because expert witnesses add value. They help the attorneys prepare for temporary motion hearings and settlement discussions. They narrow down the issues and can provide credible expertise and testimony to a case.

Instead of thinking of an expert witness as a cost, think of an expert witness as someone who can add value to your case.

Andrew M. Tatge is a partner and chair of the Family Law and Divorce Practice Group at Gislason & Hunter LLP (www.gislason.com). He regularly represents farmers, business owners, professionals, and other high earning and high net worth individuals (or their spouses) in divorce, business, and related legal matters. Andrew can be reached at atatge@gislason.com or (507) 387-1115. This information is general in nature and should not be construed as tax or legal advice.

Wills, “Illegitimate” Children, and the Modern Family (Or, Why You Need to Read the Definition Section of Your Will, Even If It’s Boring)

2013-01-23T15:07:00-08:00

It’s very common for wills to grant property to a particular person, then add that if that particular person doesn’t survive the testator (person who makes a will), the property goes to that person’s “descendants.” “Descendants” (or sometimes “issue”) is an extremely important word in many wills, but what does it mean? The short answer is, it means whatever your will says it means, so you need to make sure the definition in your will matches your intentions.

Who Am I Excluding From My Will If I Exclude “Illegitimate” Descendants?

Particularly in older wills, it’s common for the definition of family terms like “descendants” and “issue” to specifically exclude “illegitimate” children. For example, one option in the Minnesota CLE Drafting Wills and Trust Agreements (6^th Ed.) suggests:

“Descendants” means all persons who are lineally descended from the person whose descendants are referred to (including legally adopted lineal descendants) but excludes illegitimate descendants and their descendants. For the purposes of this Will, an illegitimate descendant is a person (other than an adopted descendant) whose biological parents were not married at the time of such person’sconception or anytime after such conception and prior to the Settlor’s death.

This definition meets the needs of many families, but that’s not the right question to ask when making your will. You want a will that meets the needs of your family.

First, the term “legitimacy” may not accurately reflect who you consider a part of your extended family and intend to remember in your will. According to the National Center for Health Statistics, 41% of all U.S. births in 2009 occurred outside of marriage, up from 11% in 1970. Changing social trends in the acceptance of non-marital relationships also mean that more of these babies are being accepted as “part of the family” by grandparents, aunts and uncles, and other extended family members.

Even more dramatically, both the law and society in general are shying away from treating non-marital children differently from marital children. Note that the above definition of “descendants” wouldn’t disinherit a descendant that had a non-marital relationship, which the testator may disapprove. It would disinherit the child born from that relationship, who did nothing to “deserve” disinheritance. If that is not your intent, you may want to consider a definition of “descendants” that doesn’t use a term like “legitimate” at all.

Second, if your will has a clause excluding “illegitimate” descendants from inheriting, does your will define what “illegitimate” means, as the example above does? Some wills—particularly older ones—may not, assuming that everyone would understand and agree on what “illegitimate” means.

That’s not the case anymore. The words “legitimate” and “illegitimate” are no longer used to describe children in the Minnesota Statutes.* Some older definitions of the word “legitimate” even exclude children whose parents marry after the child is born.

Third, even if your will defines “illegitimate” the way the above example does, children resulting from some modern family structures don’t always fall neatly into either the “legitimate” or “illegitimate” category. For example, what if a child only ever had one “parent” in the legal sense, such as when a single woman has a child using a sperm donor? What about a child born to a same-sex couple who are married under the laws of one state, but not under the laws of the state where the testator lives, or maybe even where the couple lives?

Or what about a situation like that in Astrue v. Capato, a recent Supreme Court case involving a widow who, with his permission, used her late husband’s frozen sperm to have children born two years after his death? Technically, those children are “illegitimate” under the example definition above. The widow wasn’t married at the time of the children’s conception or afterwards, because you can’t be married to a dead person. Would the late husband’s parents really intend to disinherit their biological grandchildren in a situation like that?

How Should I Handle So Many Different “What If’s” in My Will?

If all of these questions feel too overwhelming, you may want to consider having broader definitions in some places in your will than in others. For example, you may know you and your spouse only have “legitimate,” marital children, but you don’t want to accidentally disinherit a great-grandchild just because, years from now, one of your grandchildren might have a child in one of these less-traditional ways. In that case, you could ask your attorney to limit the definition of “children” in your will, but have a broad definition for descendants in later generations.

The truth is, you can’t expect to foresee exactly how your extended family will grow and change over time. That’s one of the reasons why it’s important for you to talk to your estate planner on a regular basis. Explain your definition of “family” and what your intentions are in limiting who is included in your will. And if you already know that someone in your family has a non-traditional family of their own, tell your estate planner. Part of an estate planning attorney’s job is to come up with a will that best fits your desires and your family, no matter how traditional or unique your family’s structure may be.

*The preferred term for children born outside of wedlock—and the one Minnesota Statutes now uses—is “non-marital children.”

Kaitlin M. Pals is a business and estate planning attorney with Gislason & Hunter LLP (www.gislason.com), who also practices in the family law areas of assisted reproductive technology, adoption, and guardianships. Kaitlin can be reached at kpals@gislason.com or (507) 354-3111. This information is general in nature and should not be construed as tax or legal advice.

Buying the Farm: Things to Look for in Negotiating a Farm Divorce Settlement

2013-01-03T13:28:25-08:00

In Minnesota, divorces involving farms and farming operations can be some of the most complex and difficult matters to resolve. In addition to the emotional issues concerning the family farm or a farming operation that has been in existence for some time, there are also significant financial and cash flow considerations to take into account as well.

It is vitally important when negotiating and resolving a property division involving a farm to understand the nature and character of the farm assets and to take into account issues of cash flow and valuation. Particularly in the current economic climate, the substantial value of a farm operation may be tied up in the land—which the farming spouse needs to retain in order to continue operations. If there is a lack of significant liquid or other assets to divide or transfer in exchange for the land, a circumstance can arise where it is impossible to equitably divide the marital estate at the time of divorce, meaning that payments will need to be made in the future to provide an equitable division. When this occurs, some of the many details which should be discussed and addressed include the following:

The amount of payment.

The payment schedule. For example, will payments be made on a yearly basis, monthly basis, or some other schedule?

Will interest be paid on the principal of the outstanding amount or not?

Will there be a lien on property awarded to the farming spouse to ensure payment of the cash settlement? Are security agreements and other documents necessary to adequately protect the spouse who will be obtaining future payments in exchange for the farming spouse being awarded the farm assets?

Should assets awarded to the farming spouse be titled in his or her name immediately, or should that transfer be delayed until sometime in the future?

Should there be option agreements or are other sophisticated transactions appropriate or desirable between the parties? If so, what are the triggering events?

What happens if the farming spouse does not pay? Should there be specific provisions about the other spouse obtaining assets through repossession or some other consequence, including payment of attorney’s fees, indemnification, etc.?

Should spousal maintenance be reserved until the cash settlement is paid in full?

Many times it is necessary or appropriate for divorcing parties engaged in a farming operation to enter into settlement agreements which allow cash flow to the farming spouse and a reasonable and equitable payment over time to the non-farming spouse. It is important to understand and work with experienced attorneys who regularly represent parties in farm divorces to adequately protect your interests.