Will husband’s adultery result in a less than 50% share of marital property upon divorce?

Will husband’s adultery result in a less than 50% share of marital property upon divorce?

Yes, in the case of Kyger v. Kyger, Case No: CL17-2132 in the Circuit Court of Rockingham County, Virginia.  Virginia does not start equitable distribution with an even or 50-50 split of marital property, as restated in Robbins v. Robbins, 48 Va. App. 466, 632 S.E.2d 615 (2006), “Under settled principles, Virginia law “does not establish a presumption of equal distribution of marital assets.” Watts v. Watts, 40 Va.App. 685, 702, 581 S.E.2d 224, 233 (2003) (citation omitted).”  Accordingly, in the Kyger case, the Virginia Circuit Court judge divided the marital property on a 42-58% basis due to husband’s adultery, which affected his wife and their poultry business.

In Kyger, the parties were married thirty-three years before separating due to husband’s adultery.  During the marriage, they acquired substantial assets, including the marital residence and a poultry business.  While wife contributed $50,000 of her separate funds toward the improvement of what became the marital residence, she was unable to prove through tracing the existence of those funds in marital property at the time of separation.  The husband left the wife and the poultry business, which wife was unable to run on her own, in order to continue his extramarital affair with a co-worker.  The husband’s affair started while his wife was suffering from various bouts with basal cell carcinoma.  Prior to leaving his wife, husband had been engaging in sexual intercourse at different times with his wife and his paramour, unbeknownst to his paramour.  While wife desired to preserve the marriage for religious reason, she gave husband an ultimatum, which led to the separation of the parties.

At trial, the judge found the wife to be credible and accepted her appraiser’s value for the farm.   The judge found the husband was not credible and discounted his expert’s testimony on valuation due to errors in calculation. The judge found that the husband’s adultery had a direct adverse effect the poultry business, as he chose to leave the business.  The wife was awarded the martial residence and the poultry business, in return for a lump sum payment to husband from wife, while husband received mountain land.  The judge awarded wife total allocated assets less allocated debts worth $680,231.48, while husband received $498,431.93.  Splitting the difference, one could conclude that husband’s adultery cost him $90,899.78.

You should consult with your Virginia divorce lawyer or Glen Allen divorce lawyer James H. Wilson, Jr., to discuss how adultery might affect the outcome of your divorce case.

Can a Virginia court order a devoted and financially responsible husband to pay spousal support to his adulterous wife based merely on a gross disparity in income?

Can a Virginia court order a devoted and financially responsible husband to pay spousal support to his adulterous wife based merely on a gross disparity in income?

No, not in the case of Mundy v. Mundy, 66 Va. App. 177, 783 S.E.2d 535 (2016), where the Virginia Court of Appeals reversed the decision of the Circuit Court judge recognizing the manifest injustice exception to the bar on alimony to an adulterous spouse.

The parties were married for more than twenty-five years and husband was the primary breadwinner, earning as much as $850,000 per year.  The wife worked part time for less than a year.  The husband was a financially responsible and devoted spouse and father, who took his family on vacations and supported his spouse.  The husband treated his wife to dinners out and entertainment, and supported her interests in the arts and in a rock band. The husband provided daily care to his children and was involved in their extracurricular activities.

Wife admitted to adultery with a member of her rock band and with her personal trainer before separating and two post-separation adulterous relationships with others.

The parties entered into a property settlement agreement in which wife received assets worth $1.8 million dollars, including retirement funds.  Husband received the marital residence and agreed to pay for their children’s college expenses.  The parties did not address spousal support in their property settlement agreement, but left it for a decision by the trial court.

At trial, husband’s vocational rehabilitation expert testified to wife’s earning capacity, which would allow her to earn a sufficient income to support herself.  During closing argument, wife’s attorney admitted that there was no fault on husband’s part.  Nevertheless, the trial court judge recognized the manifest injustice exception to the Virginia bar on spousal support to an adulterous spouse due to the disparities in income of the parties.  The husband appealed the decision to the Virginia Court of Appeals.

The appellate court first recognized the standard of review.  The trial court’s fact findings would not be overturned unless plainly wrong or without evidence to support them.  Further, the appellate court recognized that undisputed or uncontradicted evidence that is not inherently incredible may not be arbitrarily disregarded by the trial court judge, citing Stroud v. Stroud, 49 Va. App. 359, 372, 641 Se.E.2d 142, 148 (2007), quoting Schweider v. Schweider, 243 Va. 245, 250, 415 S.E.2d 135, 138 (1992).

The court then recognized the bar to spousal support under Virginia Code §20-107.1(B) for adulterous conduct under Virginia Code § 20-91(A)(1), and the narrow exception to that bar for manifest injustice, which must be proved by clear and convincing evidence, Congdon v. Condon, 40 Va. App. 255, 578 S.E.2d 833 (2003), based on the respective degrees of fault and the relative economic circumstances of the parties.  The court stated that a “manifest injustice” had been found to be equivalent to a “miscarriage of justice”, citing Harris v. DiMattina, 250 Va. App. 306, 462 S.E.2d 338 (1995).

The appellate court distinguished the facts in Mundy from its decision upholding a manifest injustice in Congdon v. Condon, 40 Va. App. 255, 578 S.E.2d 833 (2003).  Both fault and relative economic circumstances must be considered together to find a manifest injustice.  In Congdon, the husband had abused the wife, his children and other family members, constituting unusual fault on husband’s part.  Further, the wife had been left with no assets and earned only $10 per hour.  In contrast, the wife in Mundy was left with assets in excess of a million dollars, had a mechanical engineering degree from Rice, and was capable of earning $27,500 to $33,000 per year.  Further, the wife in Mundy was 55 years old and would soon be able to access retirement funds.  The Virginia Court of Appeals ruled that the disparity in incomes found by the trial judge was not a sufficient manifest injustice and reversed the award of spousal support.

You should consult with your Virginia divorce lawyer or Richmond divorce lawyer James H. Wilson, Jr., to discuss how adultery might affect the outcome of your divorce case.

Does wife’s alleged prior infidelity invalidate a separation agreement incorporated into a final decree of divorce?

Does wife’s alleged prior infidelity invalidate a separation agreement incorporated into a final decree of divorce?

Not in the case of Kahn V. McNicholas, 67 Va. App. 215, 795 S.E.2d 485 (2017), where the Virginia Court of Appeals upheld the Circuit Court ruling the attorney ex-husband was in contempt of court for failing to abide by the terms of the final decree.  While the primary issue involved in Kahn is the court’s ability to hold a spouse in contempt for failing to pay a monetary obligation, the ex-husband also raised wife’s prior adultery as a defense to enforcement of the separation agreement.

In Kahn, the parties voluntarily separated after more than ten years of marriage.  The husband, a licensed practicing attorney in Virginia, drew up the written separation agreement and the final decree of divorce.  In the written separation agreement, he agreed to pay his wife $40,000 in sixteen monthly installments of $2,500 and the parties waived each’s right to spousal support.  In the final decree of divorce, husband’s monetary obligation to wife was described as spousal support in that portion of the form decree he used incorporating the language required by Virginia Code Section 20-60.3 (which is only required in orders directing the payment of spousal or child support, including one created by the incorporation of a written separation agreement).  Husband also agreed to cover wife’s insurance for the remainder of the year of divorce.

After making ten monthly payments, husband stopping making the monthly payments, claiming the agreement was invalidated by wife’s prior adultery.  Wife filed a petition for a rule to show cause, and the court summoned the husband to appear and show cause why he should not be held in contempt of court for violating the terms of the final decree.  In addition to his argument about wife’s prior infidelity, the husband argued the court could not hold him in contempt for violating a monetary obligation, citing Brown v. Brown, 5 Va. App. 238, 361 S.E.2d 364 (1987).  Further, husband alleged wife and her attorney should be sanctioned for describing the monetary obligations as support.  The court disagreed with all of husband’s arguments and gave him a month to purge his contempt by curing the default in payments.  Husband’s appeal of this order was dismissed as the order was interlocutory and not final.  After husband failed to purge his contempt, the Circuit Court judge held husband in contempt for violating both the interlocutory order and the final decree of divorce.

On appeal, the Virginia Court of Appeals recognized that the applicable standard for reviewing a trial court’s ruling that a party was in contempt of court was the abuse of discretion standard, citing Epps v. Commonwealth, 47 Va. App. 687, 626 S.E.2d 912 (2006).  In addition, the evidence would be viewed in the light most favorable to the appellee wife, who was the prevailing party, and reasonable inferences would be drawn in her favor.  Congdon v. Congdon, 40 Va. App. 255, 578 S.E.2d 833 (2003).

The Virginia Court of Appeals disagreed with husband’s arguments and upheld the trial court’s ruling of contempt of court.  The written separation agreement was properly made a part of the final decree by virtue of Virginia Code Section 20-109.1, and was enforceable as any court order, even though spousal support is different from other monetary obligations.  Alternatively, the monetary obligation could be seen as part of the final decree pursuant to the court’s authority to enter a lump sum money judgment under Virginia Code Section 20-197.3.  The appellate court held that the ruling in Brown v. Brown was superceded by amendments to Virginia’s equitable distribution statute in 1991.  Specifically, Virginia Code Section 20-107.3(K) now provides that the court has the authority to “..[p]unish as contempt of court any willful failure of a party to comply with the provisions of any order made by the court [under the equitable distribution statute]”.  The Virginia Court of Appeals disagreed with husband’s argument for sanctions, as he drafted the final decree which described the payments as support, and the characterization of the payments as support was, at worst, an inadvertent error which did not deprive husband of his ability to defend the show cause.

You should discuss any alleged violations of a separation agreement or final decree with your Virginia divorce lawyer, or Richmond Divorce Lawyer James H. Wilson, Jr.

Can a Virginia court award a legal separation based on adultery?

Can a Virginia court award a legal separation based on adultery?

No, a divorce from bed and board or a legal separation may not be granted based on adultery in Virginia; adultery is only a fault ground for a full divorce, a divorce from the bond of matrimony.  In the unpublished case of Garrett v. Garrett, Record No: 1440-16-4 (Va. App. 2017), the Virginia Court of Appeals remanded a divorce case back to the trial court for a nunc pro tunc (“now for then”) order granting a divorce from the bond of matrimony for adultery, to correct what the appellate court believed was a clerical error in granting a divorce a mensa et thoro instead, a divorce from bed and board or what the court called a legal separation.

In Garrett, the parties were married for fifteen years before separating, after husband confessed to wife that he was having an affair with his ex-wife.  After the confession, husband became suicidal and checked himself into the hospital, never to return to the marital residence.  While husband was in the hospital wife removed $65,000 from the couple’s joint account.  The husband had been employed as a defense contractor making approximately $110,000 a year in salary, but had been fired due to poor job performance and missed work.  The wife filed for divorce based on husband’s adultery.  Subsequently, the wife obtained a protective order against the husband.  The husband appeared in the protective order proceeding, but did not appear for the trial on the divorce case.  The wife failed to call her corroborating witness, and husband’s counsel moved to strike wife’s case.  The divorce court judge permitted wife to reopen her case to call her corroborating witness, who she argued was not previously called due to an inadvertent mistake, even though the witness had been present in the courtroom.

Approximately two weeks after the trial, the husband moved the court to reopen the case to allow him to testify and present his evidence.  The court denied husband’s motion, based on a hospitalization due to his mental illness, as not credible.  The court granted the wife a divorce a mensa et thoro based on husband’s adultery.  Both parties appealed.  The husband based his appeal on the court’s refusal to reopen the case, its granting the motion to reopen to wife, its awarding GI Bill benefits to the wife, its imputation of income to him, its award of the $65,000 to wife, and its refusal to allow him extra time to review the final decree for errors. The wife based her appeal on the court’s granting her a divorce from bed and board instead of a divorce from the bond of matrimony based on husband’s adultery.

The Virginia Court of Appeals found there was no abuse of discretion by the trial judge in denying husband’s request for a continuance or denying his motion to reopen the case.  In contrast to husband’s motion to reopen several weeks after trial and his failure to show prejudice from a denial, wife’s motion was made immediately at the conclusion of trial and was properly granted as within the trial court’s discretion.  The appellate court did agree with husband’s argument that the trial court lacked the legal authority to award husband’s GI Bill benefits to wife, and reversed that portion of the divorce decree.

The court refused to rule on the trial court’s award of the $65,000 from the joint account to wife, because it did not rule in husband’s favor on his argument to reopen and for a continuance, but it did allow the trial court to reconsider equitable distribution based on the record, in lights of its reversal of the GI Bill benefits.

The Virginia Court of Appeals upheld the trial court’s imputation of income to husband for purposes of calculating spousal support and child support, as he was at fault for losing his job, but reversed the trial court’s award of nonmodifiable spousal support, as being in contravention of Virginia Code §20-109(A), which provides that court ordered support may always be modified.  The appellate court also reversed the trial court’s award of all of husband’s military pension to wife, as exceeding the limit of 50% prescribed by Virginia Code §20-107.3(G).

Finally, the appellate court remanded the case to correct the clerical error of awarding only a divorce from bed and board, not a full divorce, based on adultery.  Virginia has an intermediate form of divorce known as a divorce from bed and board, which does not allow the parties to remarry, but recognizes that they are no longer sharing the same bed and table.  A divorce from bed and board, filed under Virginia Code §20-95, may be filed immediately, without any minimum separation period, and only on the fault grounds of cruelty, reasonable apprehension of physical harm, desertion and abandonment.  Divorce lawyers use the divorce from bed and board in Virginia as a way to file the case right away and obtain the temporary or pendente lite relief available incidental to a divorce.  Interestingly, the Court of Appeals referred to the divorce from bed and board as a legal separation.

You should contact your Virginia divorce lawyer or Glen Allen divorce lawyer James H. Wilson, Jr., to discuss your options in the event of adultery in a marriage.

 

 

Will a court award spousal support of $12,000 a month to wife on top of a $2.5 million dollar equitable distribution award, when husband’s adultery was a significant, but not a primary cause of the end of the marriage?

Will a court award spousal support of $12,000 a month to wife on top of a $2.5 million dollar equitable distribution award, when husband’s adultery was a significant, but not a primary cause of the end of the marriage?

Yes, in the case of Gordon v. Gordon, Record No: 2038-16-02 (Va. App. 2017), where the Virginia Court of Appeals upheld the Chesterfield County Circuit Court judge’s award of spousal support to wife in the amount of $12,000 a month, on top of a $2.5 million dollar equitable distribution award.  The husband and wife were married for twenty-seven years before separating.  One child was born of the marriage and the wife stopped working outside the home to take care of the child.  In the six years before the equitable distribution hearing, the husband earned between $360,000 to $900,000 per year as a financial advisor.  Nevertheless, the family lived well below its means on approximately $9,000 a month, and managed to amass marital assets of approximately $4.5 million dollars.

At trial, husband’s vocational expert testified that the wife was capable of making between $24,000 to $29,000 a year.  The husband’s financial advisor expert testified that wife could expect to receive $65,000 a year, after taxes, from a potential recovery of $1.5 million dollars in equitable distribution.  Wife’s expert witness CPA testified that wife would have to pay income taxes of $4,678 on spousal support of $15,000 a month.  The wife’s evidence showed monthly living expenses of $28,578, while husband’s evidence of wife’s expenses was only $5,867.

The trial court judge found that husband’s adultery was significant, but not the primary cause of the end of the marriage.  While the husband made the primarily monetary contributions to the family, the wife contributed to the accumulation of marital assets by agreeing to live below the couple’s substantial means and by taking care of their son and home.  The divorce judge awarded wife half the marital assets in the amount of $2.5 million dollars, plus $12,000 a month in spousal support and $35,000 for her attorney’s fees and costs.  The court did not impute income to the wife because of her long absence from the workforce, and would not consider income from her award of equitable distribution as she would have to deplete her share of marital assets while husband kept his.

On appeal, the Virginia Court of Appeals affirmed the decisions of the trial court judge and denied wife’s request of attorney’s fees and costs for defending the appeal.  The court recognized that the standard of review on appeal for an award of spousal support was an abuse of discretion, citing Fox v. Fox, 61 Va. App. 185, 734 S.E.2d 662 (2012).  To overturn such a decision, the appellate court must find that it was plainly wrong or without evidence to support it, citing Robinson v. Robinson, 54 Va. App. 87, 675 S.E.2d 873 (2009).  While the wife has the burden of proof to support an award of support, Robbins v. Robbins, 48 Va. App. 466, 632 S.E.2d 615 (2004), the appellate court will view the evidence in the light most favorable to the wife.  The Duncan appellate opinion includes the following primer on the law of spousal support in Virginia:
“In fashioning an award of spousal support, a circuit court “must consider all the factors enumerated in Code § 20-107.1(E).” Fox, 61 Va. App. at 203, 734 S.E.2d at 671. Specifically, the court “shall consider the circumstances and factors which contributed to the dissolution of the marriage.” Code § 20-107.1(E). In addition, it is required to consider the parties’ needs, financial resources, standard of living during the marriage, ages, nonmonetary and monetary contributions to the well-being of the family, contributions to each other’s careers, property interests, and earning capacities. Id. Further, the court must take into account the duration of the marriage, equitable distribution of the marital property, and “[s]uch other factors . . . as are necessary to consider the equities between the parties.” Id. However, the court “is not ‘required to quantify or elaborate exactly what weight or consideration it has given’” each of the factors enumerated in Code § 20-107.1(E). Fox, 61 Va. App. at 203, 734 S.E.2d at 671 (quoting Woolley, 3 Va. App. at 345, 349 S.E.2d at 426). “Where [an] evidentiary foundation exists and the record discloses that the trial court has given consideration to each of the statutory factors, we will not disturb its determination as to spousal support on appeal.” Id. at 203-04, 734 S.E.2d at 671.”

In considering the equitable distribution award, the appellate court first pointed out the distinction between the considerations in equitable distribution and the considerations for spousal support, that spousal support requires a consideration of the equities between the parties and the standard of living established during the marriage while equitable distribution is concerned with the acquisition, growth and preservation of marital assets, citing Lightburn v. Lightburn, 22 Va. App. 612, 619, 472 S.E.2d 281, 284 (1996) and Robinson v. Robinson, 54 Va. App. 87, 92, 675 S.E.2d 873, 875 (2009).  Here, the trial court judge did consider the earnings from marital assets, but chose to reject the expert witnesses’ testimony because it would result in a depletion of wife’s marital assets while husband retained his.  How the judge chooses to weigh the evidence he considers is not properly the subject of an appeal.

Further, the appellate court noted that the trial court judge properly considered the factors in Virginia Code Section 20-107.1(E), including husband’s adultery which was significant but not the ultimate cause of the dissolution of the marriage.  The circuit court provided the reasoning and the factual basis for its award of spousal support.  As such, the record supported the judge’s factual findings and the judge did not abuse his discretion.  The judge was not plainly wrong in failing to impute income to the wife as he considered her earning capacity, but recognized her difficulty in obtaining meaningful employment after her absence from the job market.  The appellate court disregarded the husband’s argument that the award of spousal support was excessive relative to its finding of her monthly exceptions, as his misunderstanding that an award of spousal support is solely designed to maintain the spouse at her former standard of living during the marriage, citing Robinson and Miller v. Cox, 44 Va. App. 674, 685, 607 S.E.2d 126, 131 (2005).

The lesson of the Gordon case is that divorce trial judges have a great deal of discretion in Virginia, and you take your chances when you try a divorce case.

You should consult with your Virginia divorce lawyer or Glen Allen divorce lawyer James H. Wilson, Jr., to discuss your options and the best course of action.

Should adultery or some other fault ground for divorce in Virginia, determine the amount and duration of spousal support or alimony?

Should adultery or some other fault ground for divorce in Virginia, determine the amount and duration of spousal support or alimony?

The decision whether to award spousal support and the amount and duration of spousal support to be awarded are left to the judge’s discretion in Virginia.  The court is required, under §20-107.1(E), to consider the circumstances and factors which contributed to the dissolution of the marriage, specifically including adultery, conviction of a felony, cruelty, reasonable apprehension of bodily hurt, or willful desertion or abandonment.  This is a threshold determination that can affect whether a spouse is entitled to support, but that should not affect the duration or amount of support, which should be decided according to the factors numbered 1 through 13 in §20-107.1(E).  A judge must deny spousal support to the guilty spouse when the fault ground of adultery is proven, unless clear and convincing evidence demonstrates that the denial would result in a manifest injustice, as provided in Virginia Code Section 20-107.1(B).

The Virginia Court of Appeals addressed the relationship between fault and support in the unpublished case of Lothar W. Nass v. Arlene Wolin Nass, Record No. 1882-00-1 (April 10, 2001).  In Nass, the parties were married twenty years before separating.  No children were born of the marriage, or adopted.  The husband filed first for a divorce from bed and board under Virginia Code Section 20-95.  The wife filed a cross bill (now properly a counter-claim under Rule 3:9 of the Supreme Court of Virginia for divorce and equitable distribution, alleging cruelty and desertion by husband.  In Virginia, evidence in a divorce case can be presented directly to the court ore tenus or to a commissioner in chancery under Virginia Code Section 8.01-607, a quasi-judicial officer appointed by the court who can make findings of fact and report to the court, or, in some cases, though written or oral depositions.  In Nass, the commissioner found that husband was guilty of cruelty tantamount to constructive desertion and recommended a divorce a vinculo matrimonii or final divorce be entered in favor of the wife.  The husband objected to the commissioner’s report on the grounds that the parties had agreed, during the hearing, to proceed on a no-fault, one year separation, basis, as permitted by Virginia Code Section 20-121.02.  The Virginia Circuit Court overruled husband’s objection granted the wife a divorce on the grounds of desertion and denied husband’s request for spousal support.

On appeal, the Virginia Court of Appeals reversed the trial court’s ruling with respect to the divorce based on constructive desertion, holding that the record demonstrated that husband had validly moved the court for a no-fault divorce under Section 20-121.02 and the evidence supported the relief he requested.  The Virginia Court of Appeals remanded the case to the trial judge to enter a divorce based on living separate and apart for a year, instead of the fault ground of constructive desertion in favor of the wife.

With regard to spousal support, the appellate court first recognized that “[w]hether and how much spousal support will be awarded is a matter of discretion for the trial court”, citing Barker v. Barker, 27 Va. App. 519, 500 S.E.2d 240 (1998).  The Virginia Court of Appeals then noted that under Section 20-91(A)(9)(c), the entry of a no fault divorce decree does not lessen the obligation of either spouse to support his or her spouse, unless the spouse proves the existence of a fault ground in his or her favor.   The court further noted that the spousal support section, Section 20-107.1, did not specify how fault grounds were to be considered in making the threshold determination of whether spousal support would be appropriate.  If an award of spousal support were appropriate, then the trial court should consider the factors listed in Section 20-107.1(E).  In this case, the Virginia Court of Appeals found evidence in the record of husband’s egregious conduct toward wife, thus justifying the divorce court judge’s ruling that husband was not entitled to spousal support.

You should consult with your Virginia divorce lawyer concerning whether any fault grounds would prevent you or your spouse from obtaining spousal support.

 

Does a Virginia equitable distribution award to wife based on husband’s adultery, drinking, gambling and verbal abuse require a showing of adverse economic impact?

Does a Virginia equitable distribution award to wife based on husband’s adultery, drinking, gambling and verbal abuse require a showing of adverse economic impact?

Not in the case of Attiliis v. Attiliis,  where the Virginia Court of Appeals ruled that husband’s drinking, adultery, gambling and verbal abuse constituted negative nonmonetary contributions to the well-being of the family entitling wife to a Virginia equitable distribution award of $65,000 without a showing of adverse economic impact , citing Watts v. Watts, 40 Va. App. 685, 581 S.E.2d 224 (2003) .

In Attiliis, the Virginia Court of Appeals addressed four equitable distribution decisions of the trial court: the distribution of a capital loss carry-forward tax credit; an order to maintain wife as a beneficiary on husband’s life insurance; an award to wife for waste, dissipation of assets, and negative non-monetary contributions; and a finding that husband’s adultery was the primary cause of the dissolution of the marriage.  The Virginia Court of Appeals first restated the rule that it will not reverse the divorce court’s discretion in fashioning an equitable distribution award unless it appears from the record that the divorce court abused its discretion, failed to consider or misapplied the factors in the equitable distribution statute, Virginia Code Section 20-107.3(E), or made essential fact findings unsupported by the evidence.

The Virginia Circuit Court in the Attillis case was reversed on its findings with respect to a $75,000 long-term capital loss carry forward and a $40,070 short-term capital loss carry forward as unsupported by the evidence at trial.  Although Wife had listed a $75,000 capital loss shown on tax returns as an asset on a list of assets in evidence, Wife offered just the couple’s 2005 tax return into evidence, which did not reveal the disputed $75,000 capital loss tax credit.  Further, Wife’s attorney did not cross-examine Husband with respect to the exact amount of the capital loss tax credit when he denied the $75,000 figure, and conceded in his closing argument that Wife was claiming half of a $37,070 capital loss carry forward.

The Circuit Court was also reversed on its ruling that husband was required to maintain wife as a beneficiary on his life insurance policy as without statutory support in Virginia Code Section 20-107.3(G)(2).  Although Virginia Code Section 20-108.1(D) allows a court to order a party to maintain an existing life insurance policy with a child as the beneficiary in a child support proceeding for the duration of a child support obligation, and Virginia Code Section 20-111.1 provides that an existing written contract with a revocable death benefit is revoked upon entry of a divorce decree, unless the parties’ contract or the divorce decree provides otherwise, nothing in the Virginia Code allows a judge to order a spouse to maintain life insurance for the other spouse’s benefit.

With respect to the divorce court’s findings and rulings on waste, dissipation of assets, and negative non-monetary contributions, the Virginia Court of Appeals first reversed the Circuit Court’s equitable distribution award for waste of a bank account following execution of the couple’s separation agreement because the award did not account for husband’s half interest in the wasted funds and thus was unsupported by the evidence.  The court next reversed the divorce court’s award of $50,000 for dissipation of assets as without supporting evidence because waste and dissipation of assets are the same thing and do not occur over the course of the marriage, but instead only while the marriage is undergoing an irreconciliable breakdown.  Finally, the Virginia Court of Appeals upheld the divorce court’s award of $65,000 for husband’s adultery, drinking and verbal abuse because the trial court’s considerations of non-monetary contributions to the well-being of the family do not require a showing of an adverse economic impact, as contended by Husband.

The Virginia Court of Appeals ruled that husband had waived his argument that the circuit court erred in ruling that Husband’s adultery was the primary cause of the dissolution of the marriage because Husband failed to cite legal authority in support of his argument in his appellate opening brief as required by Rule 5A:20 of the Rules of the Supreme Court of Virginia.

You should consult with your Virginia divorce lawyer concerning the likely effects of spousal misbehavior on an equitable distribution award.

When a Virginia divorce is based on adultery, would it be a manifest injustice to deny spousal support to a wife who is still living with her paramour and their son?

When a Virginia divorce is based on adultery, would it be a manifest injustice to deny spousal support to a wife who is still living with her paramour and their son?

Not according to the City of Salem, Virginia, Circuit Court judge in the case of Carter v. Carter , Case No: CL09-524, who denied permanent spousal support or maintenance to the wife who was guilty of adultery and continued to live with her paramour and their child.  While the case does not directly concern bankruptcy law, it does highlight some of the financial repercussions of the fault ground of adultery in a Virginia divorce case.  Under Virginia Code Section 20-107.1, a Virginia divorce court judge shall not award permanent maintenance or support to a guilty spouse when the fault ground of adultery, sodomy or buggery committed outside the marriage exists, under Virginia Code Section 20-91(1), unless the denial of support and maintenance would constitute a manifest injustice, as shown by the higher civil burden of proof of clear and convincing evidence.  The divorce court trial judge would examine the respective degrees of fault during the marriage and the relative economic circumstances of the parties in determining whether such a manifest injustice would result from a denial of alimony or permanent spousal support.

In Carter, the couple were married for sixteen years and had seven children before separating.  The wife had worked prior to the marriage, but did not work outside the home after the marriage.  Both parties were deeply involved with their church and the wife had home schooled the children.  The evidence indicated that the husband abused his role as the spiritual head of the household (in accordance with the parties’ religious beliefs) by belittling his wife and treating her as a child, strictly limiting her budget and holding her accountable for all her spending.  The wife tired of the husband’s neglect and controlling treatment of her and withdrew from the marriage, concentrating on raising her children.  She contacted an old boyfriend through the internet and began going out at night to meet him.  The husband became even more controlling, taking the wife’s cell phone and her car keys from her.  The wife eventually left the marital residence to live with her paramour, with whom she had a child.

The Virginia Circuit Court judge appointed a guardian ad litem to represent the interests of the minor children of the parties in the custody dispute portion of the divorce case.  The report of the guardian ad litem reflected the different views of the husband and the wife toward the marriage, which the husband found fulfilling and the wife found stifling.  The Circuit Court judge held that the wife’s adultery was the legal fault for the divorce of the parties and a negative non-monetary contribution to the marriage.  While the trial judge noted that the adultery was the result of mental neglect, domination and control by the husband, he concluded that those factors did not authorize the adultery.  The judge found the wife to be the more credible party based on the parties’ testimony, but he nevertheless awarded physical custody of the minor children to the husband and denied permanent spousal support or maintenance to the wife.  In equitable distribution, the judge did award a higher portion of the equity in the marital residence to wife rather than husband.

In denying spousal support to the wife, the judge stated that he was bound by the dictates of §20-107.1 of the Code of Virginia, and concluded that no manifest injustice would result from a denial of alimony, without revealing the factual support for that conclusion.  Although the wife had stayed at home to take care of the children for the entire duration of the marriage, the judge did impute income to her at the minimum wage in calculating child support, indicating his belief that she could or should be working now.  The fact that she was still living with her paramour would suggest that she was not without support.  One could reasonable assume that as the judge concluded that the fault ultimately rested on wife’s adultery and her financial circumstances did not leave her destitute, it was not a manifest injustice to deny permanent spousal support to her.

You should discuss with your Virginia divorce lawyer or Richmond divorce lawyer James H. Wilson, Jr., whether the marital fault of adultery might result in a denial of permanent spousal support or alimony in your Virginia divorce case.

Will a separation agreement challenged as fraudulent and unconscionable be upheld in a Virginia divorce brought on grounds of adultery?

Will a separation agreement challenged as fraudulent and unconscionable be upheld in a Virginia divorce brought on grounds of adultery?

Not in the case of Derby v. Derby, 8 Va.App.19, 378 S.E.2d 74 (1989), where the Virginia Court of Appeals affirmed the trial court’s findings that the allegations of adultery were sufficient to support a divorce on those grounds and that the separation agreement should be set aside as invalid.

George and Sandra Derby were married on April 19, 1961, and during their twenty-two years of marriage, the parties had two children. On October 6, 1983, Mrs. Derby filed for divorce, claiming cruelty, and Mr. Derby filed a cross-bill alleging adultery on several specified occasions. Approximately ten months after filing for divorce, Mrs. Derby went to the beauty shop owned by both her and her husband. She brought a copy of a settlement agreement her lawyer had drafted, providing for equal distribution of the parties’ assets.  Mrs. Derby, however, called her husband into the parking lot. After a brief discussion, Mr. Derby signed the agreement with a revision granting Mrs. Derby the majority of the parties’ property assets, including all of the parties’ real property. Mr. Derby alleged he signed the agreement while under the impression that if he did so, Mrs. Derby would return to the family home.

In the lower court proceeding, the Court held that the private investigator’s findings of adultery were sufficient to grant a divorce on those grounds but held that the property settlement as invalid. Mrs. Derby challenged the invalidation, arguing that Mr. Derby did not demonstrate fraud, duress, or undue influence by clear and convincing evidence.  To determine whether this invalidation was proper, the Court examined Virginia Code §20-109.1, which states, “[A]ny court may affirm, ratify and incorporate by reference in its decree dissolving a marriage or decree of divorce whether from the bond of matrimony or from bed and board, any valid agreement between the parties.” At issue in this case was the question of validity, which the Court addresses prior to incorporation in the divorce decree unless otherwise uncontested by the parties. See Forrest v. Forrest, 3 Va.App.236, 349 S.E.2d 157 (1986).

The trial court held that the separation agreement should be declared invalid on the basis of constructive fraud. Constructive fraud requires, “[B]reach of legal or equitable duty which, irrespective of moral guilt, is declared by law to be fraudulent because of its tendency to deceive others or violate confidence.” Wells v. Weston, 229 Va. 72, 77, 326 S.E.2d 672, 275-6 (1985). Here, the lower court ruled that Mrs. Derby’s actions of hiding her adultery from her husband and having him sign the agreement knowing he was fostering ideas of her return constituted constructive fraud; however, the Court of Appeals disagreed, stating that the fiduciary duty between the parties was severed by the separation and retention of attorneys, and, therefore, Mrs. Derby’s actions did not breach any duty. See Barnes v. Barnes, 231 Va. 39, 42, 340 S.E.2d 803, 804 (1986) (holding that when a husband and wife separate and employ attorneys, their former confidential and fiduciary relationship ends).

After examining the issue of fraud, the Court turned to whether the separation agreement should be set aside on the issue of unconscionability, which according to the Restatement, means the agreement “was such as no man in his senses and not under delusion would make on the one hand, and as no honest and fair man would accept on the other.  Restatement (Second) of Contracts § 208 comment b.  In cases of unconscionability, the court examines whether the disparity of values exchanged and the process involved in the reaching of the agreement were such that one party signed at a severe personal detriment. Here, the Court ruled that the terms were so disproportionate and the means of acquiring Mr. Derby’s signature suggested that the contract was unconscionable and should be set aside. Moreover, the Court held that the misrepresentation of Mrs. Derby about her infidelity and her possible return to the marriage, coupled with her preying on Mr. Derby’s emotional weakness created a situation where it would be inequitable to uphold the agreement. Therefore, the Court of Appeals affirmed the trial court’s decision, although it established a different basis for its decision in regards to the separation agreement.

You should consult with your Virginia divorce lawyer concerning the possibility of setting aside your separation agreement.