Mississippi Family Law Blog

Downturn in housing market impacts divorce

The downturn in the housing market is impacting the ability of some to divorce. Quite frankly, they can not afford to divorce given they owe more on their home than it is worth. In an article out of California, the impact of the housing downturn is amplified. While housing prices were up, it was easier to split the couple's assets with the home usually being the largest asset. As one person quoted in the article said, "the hardest thing was picking a Realtor." But with the downturn in housing prices, it is more difficult. Even if one spouse wants to stay in the home, they must be able to afford the house payment as well as pay off the other spouse for their share of the equity (although that is diminishing as prices slide).

More troubling is when one spouse wants to sell and the other does not. This puts the courts in the position of deciding whether to order a sale or wait in hopes the real estate market will rebound. As the article points out, these economic times raise many issues when homeowners divorce.

Continue reading "Breaking up is harder to do" »

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Posted In: Divorce , Property Division

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Dividing Retirement Benefits in a Mississippi divorce

Continuing on with my previous post on this subject, the second step for the chancellor in dividing retirement benefits in a Mississippi divorce is valuing the assets. How much are the retirement benefits worth? With a defined contribution plan, this is relatively easy as you know how much money is in the account at the valuation date or you should be able to get that information from the plan administrator. However, what if some of the benefits benefits (the employer's contribution) are not vested (that is, the employee is entitled to at the time) and are those benefits valued the same? A more difficult proposition is if the employee's retirement benefits are a defined benefit plan. In this case, it will require a formula to calculate the value of the benefits earned during the marriage. This calculation can be complex and can require the assistance of a professional.

The final step for the chancellor is how to divide the retirement benefits. This falls back to the analysis discussed in earlier post regarding the division of marital property in a Mississippi divorce.

A review of these posts regarding dividing retirement benefits in a Mississippi divorce should make it apparent that this is not a job people should attempt on their own. While you may be able to work out the basic framework for dividing the retirement benefits, you should seek the advice of a divorce attorney to protect yourself against a potential minefield.

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Posted In: Divorce , Property Division

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If spouses are unable to agree on how to divide retirement benefits in a Mississippi divorce, then the job falls to the chancellor. Retirement benefits are no different than other property in a divorce. Essentially, there are three steps.

• Determine the character of the property;


• Determine the value of the property; and


• Determine how to divide the property.

Let's take each of these steps separately.

Continue reading "How the Mississippi judge divides the retirement nest egg" »

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Posted In: Divorce , Property Division

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Guess Who’s Not Coming to Dinner

Continuing on in the discussion of the pitfalls of ERISA when dividing retirement benefits during a divorce in Mississippi, this next case illustrates the importance of complying with ERISA as well as changing the beneficiary forms following a divorce.

In Kennedy v. DuPont, Mr. Kennedy was an employee of DuPont and participated in their savings and investment plan (SIP) that was an ERISA benefit plan. In 1971, Mr. Kennedy married and three years later signed a beneficiary designation identifying his new wife, Liv Kennedy, as the sole beneficiary of the SIP plan. Twenty years later, the couple divorced. As part of the divorce, the ex-wife agreed to relinquish all rights to husband’s pension benefits with DuPont. Although a QDRO was submitted and approved, the QDRO did not address the benefits in the husband’s SIP account nor did the husband ever change the beneficiary designation for the SIP account. It only addressed the other pension benefits Mr. Kennedy had at DuPont.

Continue reading "Divorce and Death—dividing the Nest Egg" »

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Posted In: Divorce , Property Division

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Too many pieces of the financial pie

In a recent 2008 decision from the Fifth Circuit Court of Appeals (which handles federal appeals out of Mississippi as well as Texas and Louisiana), the need for a properly drafted QDRO in a divorce was stressed. This case illustrates the problem of not complying with ERISA in drafting a QDRO. Seemingly, one attorney thought a court order was sufficient, while the Fifth Circuit reminded the attorney that ignoring the dictates of ERISA is at your own peril.

Taliaferro v. Goodyear Tire & Rubber Co.involved a man married and divorced twice. The husband, who worked for Goodyear Tire & Rubber, divorced his first wife. The divorce decree required the husband to pay child support but he fell behind. In 2001, his first ex-wife took him to court to collect the child support arrearages. The state district court granted the ex-wife a right to collect the child support from his retirement account at Goodyear. The attorney sent a notice to Goodyear claiming an interest in the retirement account. In response, Goodyear told the attorney he needed to provide a Qualified Domestic Relations Order (QDRO) and supplied the attorney with the guidelines. (NOTE: QDROs can be used to collect child support.) However, the attorney never provided Goodyear with a QDRO. Rather, Goodyear received two additional state court orders directing it to withhold child support payments from the husband’s retirement account. Each time, Goodyear told the parties a properly drafted QDRO was required and each time this request was ignored.

Continue reading "Competing claims for retirement benefits" »

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Posted In: Divorce , Property Division

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Dividing Pension Plans in a Mississippi Divorce

Two major concerns arise when dividing pension plans benefits governed by ERISA. First is whether the pension plan administrator will follow the directives of the divorcing spouses. The second is how can the transfers take place without the recipient spouse being taxed by the IRS for an early withdrawal.

Assuming the husband's retirement account (using our previous example) is controlled by ERISA (which controls most private employer accounts), the retirement plan administrator will require a Qualified Domestic Relations Order (QDRO) before he will divide the benefits. ERISA prohibits state laws from interfering with ERISA plans. An exception created by Congress is the QDRO. A QDRO is a judgment, decree, or order issued by a state court which:

Continue reading "Dividing the Nest Egg in Divorce" »

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The Nest Egg and Divorce in Mississippi

Here is a common situation I see as a Mississippi divorce lawyer. A wife wants to divorce her husband. The husband works for a large employer in Madison, Mississippi and has accumulated a nice retirement account from the employer while married to his spouse. In fact, other than the house, the husband’s retirement account is the largest asset this couple owns. The wife wants to know if she is entitled to any of the retirement account. If so, can it be divided.

The answer to the first question depends on how the retirement account was earned. Generally, a retirement account that was accumulated during the marriage is marital property. The reasoning is that wages and benefits of employment earned during the marriage are marital property. That brings up the second question—how can the retirement account be divided?

Continue reading "Pension Plans and Divorce" »

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Posted In: Divorce , Property Division

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How to divide the Retirement Nest Egg in a Mississippi Divorce

As a Mississippi divorce lawyer, it surprises me the number of people who overlook the implications of retirement benefits during a divorce. For most individuals, retirement benefits are usually their biggest asset outside of their home. In the next couple of posts, I will discuss some common issues seen with retirement benefits and divorce.

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Posted In: Divorce , Property Division

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But the decree said he was responsible for that bill!

A common misconception among people going through divorce in Mississippi is the responsibility of paying debts following divorce. Here is a classic example: Husband and wife have two cars, both financed through their bank and both of their names are on the loans. During the divorce negotiations, the wife and husband agree to each keep the vehicle they drive and each agrees to pay for their own car. Following the divorce, the wife is very diligent in making timely car payments. Six months after the divorce, she goes to the bank for a loan and is denied because her credit score is too low. Upon checking, she finds that her credit score was lowered because her ex-husband was not making the payments on his car. How can this happen? Didn’t the divorce split the debts? Didn’t her husband agree to pay the debt? Not so fast. She is still financially responsible for the debt because her name is on the loan.

Continue reading "Your credit score following divorce" »

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Posted In: Divorce , Property Division

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Property bought during a separation—who owns it?

As a Mississippi divorce attorney, I get a fair amount of questions concerning property ownership. An example is this one. If my husband and I separate and file for divorce, does my husband have a legal right to any property I buy after we separate but before the divorce is finalized?

Normally, all assets acquired during the marriage are presumed to be marital property. Given there is no such thing as a legal separation in Mississippi, any property acquired from the date of marriage until the date of divorce is presumed to be martial property. There is one exception. In Godwin v. Godwin, the Mississippi Supreme Court held that:

Continue reading "In a Mississippi, who owns property acquired during the pendency of the divorce?" »

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Posted In: Property Division

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Money can’t buy me love

The Beatles were right, at least according to a survey reported in Forbes. According to the article, a survey of those with a net worth of $1,000,000 or more found almost half of the respondents unhappy in their marriage. More surprising was the fact that 61% of the women surveyed and 43% of the men admitted to being unfaithful within the last 3 years. However, even though almost half were unhappy in their marriage, only 30% said they were contemplating divorce. The reason? According to three-quarters of the men, the fear as to how much money they would lose in a divorce. 51% of the women cited the number one reason for not divorcing was “interference with business dealings.”

The most telling aspect of the study was only about 6% of the respondents had a prenuptial agreement. A properly drafted prenuptial agreement may be able to protect your hard-earned assets in a divorce in Mississippi. If you are considering marriage in Mississippi, you should discuss the issue with your future spouse. While some are reluctant to bring up the issue feeling that it indicates they will divorce in the future, the fact is in today’s society, it is more than a possibility. A prenuptial agreement is an insurance policy. None of us plan on tragedy striking our lives, but we all plan for it everyday when we buy insurance. A prenuptial agreement is similar. Discuss the issue with your fiancé and discuss the matter with an experienced attorney.

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Posted In: Divorce , Marriage , Property Division

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Cover your financial bases

Here is an interesting article in the USA Today entitled "Breaking up is hard to do financially." It offers advice for the top 5 financial mistakes couples make when divorcing. For those divorcing in Mississippi, you should discuss this advice with your attorney to ensure you are protected financially.

Posted by Robert Kisselburgh | Permalink | Email This Post

Posted In: Alimony , Child Support , Divorce , Family Law News , Property Division

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Who is responsible for the debt?

Here is a common scenario. A husband and wife own a home in Madison, Mississippi. They finance $300,000 of the $350,000 purchase price with a lender. The mortgage is in both of their names. A year after they purchase the house, the husband wants a divorce. The husband moves out of the house in Madison and moves into a house in Brandon. As part of the divorce settlement, the divorce decree states that the wife will take possession of the home in Madison and is obligated to pay the mortgage. The husband thinks he is in the clear. However, the original note on the Madison home is not refinanced. About a year later, the wife quits making payments on the house in Madison and the mortgage goes into default. The result: The lender can sue both the wife and husband for the debt and probably will despite the fact that the divorce decree says that the wife is responsible for making the payments.

This is one of the financial scenarios of divorce discussed in a USA Today article yesterday. There is a common misunderstanding many have on who is responsible for the debt. In Mississippi, if that debt was incurred by both of you during your marriage (both of your names are on the mortgage or both of your names are on the credit card account), although the divorce decree may state one spouse is responsible for paying the debt, if that spouse quits paying, both spouses credit will be impacted and the holder of the note (bank or credit card company) can sue both for the debt. The divorce decree does not change the legal obligation you have to the lender. What can you do to ensure this does not happen?

Continue reading "Who is paying the mortgage?" »

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Posted In: Divorce , Property Division

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Is this all I get?

Being a Mississippi divorce lawyer, I get questions about whether a spouse is entitled to alimony. The answer is it depends. After the equitable distribution of the marital estate (see previous post), the chancellor will look at the whole spectrum of property available to both spouses—the marital property divided as well as the non-marital property under each spouse’s control. If one party is left with a deficit, then the chancellor is to consider awarding alimony. In Mississippi, there are four different types of alimony—periodic, lump sum, rehabilitative, and reimbursement.

Continue reading "Property Division (Part III)—Alimony in Mississippi" »

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Posted In: Alimony , Property Division

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Does equitable mean equal in Mississippi?

In a divorce, what is this “equitable distribution” scheme which Mississippi follows? In 1994, the Mississippi Supreme Court described it as:

The authority of the courts to award property legally owned by one spouse to the other spouse, and recognizes that a non-working spouse’s efforts contribute to the acquisition of the marital estate… Under the equitable distribution system, the marriage is viewed as a partnership with both spouses contributing to the marital estate in the manner which they have chosen.

Ferguson v. Ferguson, 639 So.2d 921 (Miss. 1994). Well, that is the justification for the system, but how does the chancellor divide the property?

Continue reading "Property Division (Part II)—What is “equitable distribution”?" »

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Who decides who gets what property in a Mississippi divorce?

The easy answer is that if you and your spouse can agree, then each of you have a say in how your property will be divided. That is how it works in the perfect world. Yet, many times, spouses are unable or unwilling to agree on how to split their assets as one spouse usually thinks they are entitled to more property than the other. So what happens? The chancellor will decide and is guided by case law in Mississippi.

Property division in Mississippi divorces has evolved over the years. For many years, Mississippi followed the “title” theory of property division. Under this system, the person who held “title” to the property received the property in a divorce. So if a husband held title to all the family property, a wife staying at home raising the children and carrying for her husband could end up with little property at the time of divorce even though she participated in the accumulation of wealth. This system had obvious inequities.

Although Mississippi followed the title system for many years, it evolved over the last 20 years trying different methods to minimize those inequities such as using alimony to offset one spouse's disproportionate share of property. Finally, in 1994, the Mississippi Supreme Court lay to rest the “title” system by adopting the system of “equitable distribution.” Note that I said “equitable distribution,” not “equal distribution.” There is a difference.

In coming posts, I will discuss the “equitable distribution” system of property division in Mississippi divorces.

Posted by Robert Kisselburgh | Permalink | Email This Post

Posted In: Property Division

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Software making decisions in a divorce?

Technology has now entered the divorce arena at a new level. A recent technology post reports on two Australian researchers who have developed software designed to assist couples in dividing their property in a divorce. However, the software designers admit it does not work well when it comes to issues surrounding the children. In those cases, they must still rely on a family law attorney or mediator to ensure the results are in the best interest of the children.

While the software takes a step in the right direction by attempting to get couples to assign differing levels of importance to property issues and de-emphasize the emotional aspects of property division, I suspect it will not be a commercial blockbuster. What it should remind divorcing couples is that a lot of time and money can be wasted in a divorce arguing over simple property matters. Exercising tips 5 through 7 in my previous post--7 Tips for a Better Divorce—will go a long way towards a less emotional and more satisfying process.

Posted by Robert Kisselburgh | Permalink | Email This Post

Posted In: Family Law News , Property Division

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