Who Is Responsible for Student-Loan Debt in New York Divorce Proceedings?

July 5, 2017 | Law and Mediation Office of Darren M. Shapiro, P.C.

When a marriage is ending, unless there is a valid agreement between the parties, it is left up to the judge to determine the financial responsibilities of the parties in what they call in New York equitable distribution. In most cases, this requires the judge to figure out all of the marital assets as well as the marital debts. Student-loan debt is no exception; however, calculating which party is responsible for the payment of student-loan debt may be more complicated that it initially seems.

Student-Loan Debt Incurred Before the Marriage

As a general rule, student-loan debt that is incurred prior to the marriage is not considered a marital debt, and the party who took the loan out will be solely responsible for the payment of that debt. However, student-loan debt that is incurred during the marriage presents a more difficult situation and often requires the court to apply a multi-faceted test to determine which percentage of the debt, if any, is attributable to the spouse who did not incur the debt.

Student-Loan Debt Incurred During the Marriage

Under New York case law that was decided prior to the 2015-2016 updates to the New York Domestic Relations law student-loan debt may be considered marital debt that is subject to equitable distribution, depending on all of the surrounding circumstances. However, prior to the 2015-2016 update to the New York Domestic Relations law this used to also means that the degree or professional license that was obtained through the procurement of the debt may also be subject to equitable distribution. The updated Domestic Relations law, however, specifically changed the law to say that degrees were not subject to equitable distribution. In one of my next blogs we will examine whether the change to the New York Domestic Relations Law about degrees being subject to equitable distribution has altered the landscape about student loan debt.

Divorce, Disability Pensions, Pensions, Retirement Assets and Equitable Distribution

June 4, 2017 | Law and Mediation Office of Darren M. Shapiro, P.C.

Equitable distribution is one of the matters that I deal with most often as a divorce attorney for New York and LongIsland. Though all the intricacies involved in equitable distribution can be a concept that’s difficult to understand without a background in family law, it can become more challenging when an individual is facing the concerns of splitting unique elements, such as retirement benefits.

It’s relatively well know that the marital portions of retirement plans like 401ks, pensions and deferred compensation plans, are typically subject to equitable distribution in the case of a divorce. However, determining the right course of action can become more complex when it comes to disability pensions. After all, the divorce lawyers and the New York courts in cases of disagreements need to determine whether the asset is one that was accumulated during the marriage and what is appropriate as far as equitable distribution, or something that should be regarded like a personal injury award. Continue reading ›

What Happens If the Sale of the Marital Home Is Delayed Until After Divorce in New York?

April 21, 2017 | Law and Mediation Office of Darren M. Shapiro, P.C.

When two spouses get a divorce in New York, they must address multiple complicated issues, including the equitable distribution of marital property. This often includes the marital home. A divorce agreement, or a court order granting a divorce, usually includes provisions for the disposition of the marital home. The sale of a home might not be practical or even possible at the time of the divorce for a variety of reasons. What happens when a home is to be sold after a divorce? Should the person paying the mortgage get credit for the full amount of the payments or some other amount? As for the person waiting to receive their share of the sales proceeds, should they receive interest in some form? These questions have no easy answers, but they are worth exploring.

Section 236(B)(5)(a) of the New York Domestic Relations Law requires a court to resolve all issues of marital property distribution in, or prior to, a final judgment of divorce, except for issues regarding which the parties have entered into an agreement. Postponing the sale of a marital residence requires careful planning in the hopes of avoiding a return to court. A court is unlikely to approve the future sale of the home without both parties’ agreement, along with a plan for either selling it or otherwise disposing of one spouse’s marital property interest.

Divorcing spouses have several options when postponing the sale. One spouse may buy out the other spouse’s share of the marital interest, either in cash or with a promissory note. This arrangement, along with most other postponements, creates potential problems with a mortgage lender. Any postponed sale means that one spouse must continue making mortgage payments, while the other spouse remains liable for missed payments.

Dividing Retirement Savings in New York or Long Island Divorce

December 11, 2016 | Law and Mediation Office of Darren M. Shapiro, P.C.

When it comes to equitably dividing the assets that have been gathered during the course of a marriage in a divorce –retirement assets from pensions to IRAs to Annuities are important ones. Though many couples are busy fretting about who’s going to get the house or how custody agreements are going to be determined – there’s also something to be said for the importance of properly splitting retirement accounts and plans. After all, depending on the income of either spouse and the age of those spouses when the divorce takes place, retirement savings can frequently be one of the most valuable assets that any person owns. As such, we regard them as a very important matter to consider when figuring out which assets should go where for the best interests of both parties.

Unfortunately, the issue with retirement savings is that they have their own unique intricacies. These packages of money are subject to various complicated factors, such as tax implications, and this can mean that people struggle to handle them appropriately when figuring out how to divide assets. As a family lawyer, I’m left to do what I can to guide my clients carefully when they’re making decisions about financial plans and the potential options that might be available to them during the divorce.

Do You Have to Share Your Retirement Savings?

This is a question that many people have when they approach me with matters regarding the distribution of assets during a divorce. The short answer is probably yes to the extent that the assets were earned during the marriage. Portions of retirement assets which were earned before the marriage or after the end date of the marital estate (often the filing date of the divorce), are usually separate property and not shared on the other hand. People often wonder whether they can avoid sharing their savings with their soon to be ex-spouse in some way. However, most of the time, if you are going through a divorce or legal separation and your spouse or you have some money sitting in retirement savings accounts, then you will be required to share these assets amongst yourselves in an equitable fashion – either through negotiation with collaborative lawyers, an agreement made in mediation, settlement negotiations or through litigation in which a decision will be made for you by the courts of New York if your case is one of the few that does not settle before the ultimate trial. In certain cases, the assets that have built up within a retirement savings account may be awarded to one single party – but this only takes place when specific circumstances are in play. Continue reading ›

New York and Long Island Divorce and the Home

November 20, 2016 | Law and Mediation Office of Darren M. Shapiro, P.C.

Divorce and the Marital Residence

Divorces often aren’t easy. I have spent a number of years now guiding clients through the complications of divorce throughout Long Island, and New York. I’ve seen very few cases, although they exist, where there is a big dispute over lower priced property like furniture. Often if there is a dispute over assets it involves higher priced items like the marital residence. For most couples undergoing divorce, the biggest shared asset to consider is the family real estate, marital residence or former matrimonial home, as it is referred to in legal circles. The family home is an emotive subject, and often the largest asset to share amongst parties – though investments, businesses, savings, retirement assets and pensions could be worth more or be considerable assets too.

Although it’s possible to leave the concerns of asset distribution to a judge – I often find that this leads to dissatisfaction for both spouses involved. In most cases, it seems that couples are best served when they exercise their right to come up with personal solutions themselves. My office gets involved with litigated matters, settlement negotiations, and alternative dispute resolution like mediation and collaborative law.

Agreeing on an Outcome

I often find that if both parties within a divorce still have a civil relationship, and would prefer to end their marriage with a simple, clean, and quick break – selling the property might be a good idea. The only issue that presents itself here is that the individuals involved will need to think about how the proceeds from the home are going to be divided between spouses. Regardless of how you choose to break up the family home, it’s important to remember that if you can agree to a solution using mediation or collaborative law, you can often find a solution that both parties can live with. If the attempt to come up with a solution outside of the courtroom fails, like through settlement negotiations between the lawyers on a case, then the judge presiding over the divorce case in New York will need to make a determination based on existing facts and laws. However, that process will remove the parties’ ability to create a better arrangement between themselves – sometimes causing both parties dissatisfaction with the outcome. Continue reading ›

Proof of Marital Debt and Divorce

November 12, 2016 | Law and Mediation Office of Darren M. Shapiro, P.C.

There are various subcategories of issues that need to be addressed in a divorce settlement or final order from acourt. Not only do you need to make decisions about various different things – including the debt that you and your spouse have gathered over the years – but you also need to think about what steps you can take to protect your financial future. Parties sometimes expect their debt and loans will be split in a certain way – only to find that a court may see things differently.

Just like a marital home, and various other assets, debt acquired during the course of a marriage can be regarded as marital debt, and therefore allocated between the spouses involved. Commonly, this means that couples during a divorce will have a choice to either settle the responsibility for debt before filing for divorce in a negotiation, mediation, collaborative law or other process, or a determination or agreement will be made while a divorce makes its way through the court system. Ultimately, the court will make the decision if the parties do not settle ahead of time.

The New York Domestic Relations Law indicates that financial obligations taking place through a marriage which aren’t the sole responsibility of one spouse, can be offset against the total marital assets that need to be divided. However, there needs to be some kind of proof showing that the debts in question were created for marital purposes. In other words – it’s up to the person who is claiming marital debt to prove that the debt they’re referring to was incurred for marital purposes (like paying household bills, rather than a separate vacation for example). Continue reading ›

What are the Underlying Concerns of Mature and Senior Divorces?

October 28, 2016 | Law and Mediation Office of Darren M. Shapiro, P.C.

There are many reasons why couples may choose to get a divorce at a later stage in their lives. Indeed, divorces cantake place for many of the same reasons attributed to younger breakups – including financial pressures, infidelity and more. Between 1990 and 2010, the divorce rate for people between the ages of 50 and older in the U.S. doubled according to a study by sociologists at Bowling Green State University, indicating that the further we move into the future, the more natural it is to consider divorce as a solution to an unhappy marriage. One thing I notice regularly about divorces that take place between older partners, is that there are a different set of concerns in play than the worries that might have taken precedence during divorce at an early stage. For instance, when seniors get a divorce, the main focus is on both the immediate and future financial security of those individuals. Child custody, parenting time, and child support might still be at issue. Often, however, with more mature couples, there are no issues regarding child support and child custody – as the children have grown into adults who can care for themselves. Instead, the primary issues are on things like the distribution of pensions and 401ks, the choice of whether a house is sold or kept, and whether maintenance, alimony or spousal support should be awarded.

In mature people and senior divorce cases, the financial issues can be particularly crucial because if both of the people involved are already retired, then there is less likelihood that either spouse will be in a position to create new assets or income. Even if one individual is still working, they may choose to retire and find that their earned income ceases. One of the first considerations in these divorce circumstances will often be maintenance. While many young couples agree to maintenance agreement that provides support for an ex for a shorter period of time, those exiting in long-term marriages might be seeking maintenance for a longer duration. The New York 2016 maintenance law does contain not only guidelines for maintenance amounts based on income, but it also has guidelines for the duration of post divorce maintenance. Continue reading ›

Validity of a Universal Life Church Marriage and Prenuptial Agreement

September 19, 2016 | Law and Mediation Office of Darren M. Shapiro, P.C.

In New York, an antenuptial agreement that goes into effect once the parties are married may be valid even if the minister that solemnized the marriage received his authority from an unconventional religion. In Oswald v. Oswald, the court considered the effect of a antenuptial or prenuptial agreement after a marriage ceremony performed by a Universal Life Church minister. The parties had executed the agreement three days before the ceremony, but its terms only took effect after the “solemnization of the marriage.”

The plaintiff sued five years after the marriage asking the court to declare the marriage void from the beginning and the antenuptial agreement unenforceable because the person performing the ceremony did not have legal authority to solemnize the marriage. Alternatively, he wanted a divorce. The defendant responded by denying the marriage was invalid and counterclaiming for a divorce. The parties both moved for summary judgment.

The lower court granted the plaintiff’s motion. The defendant appealed, arguing that the plaintiff should not be allowed to argue the marriage was void because he represented otherwise on their joint tax returns. The court agreed that a litigant could be prevented from taking a position contrary to the position taken for purposes of filing taxes. However, it explained that a marriage that is void couldn’t be retroactively validated because the party held themselves out as being married.

Enforceability of Marital Agreements in New York Involving Jewish Law

August 15, 2016 | Law and Mediation Office of Darren M. Shapiro, P.C.

New York has a history of having a concentrated population of Jewish people who observe Jewish law. Currently, observant Jews who want to be divorced must effectuate a divorce that is valid under both Jewish law and New York state law, or they can choose not to marry under secular law and not be concerned with the way these two different systems intersect. Jewish law recognizes private marriages and private divorces that do not require court supervision.

However, Jews bound by both religious law and secular law are in a more difficult position when trying to obtain a divorce. One way in which the Orthodox community in New York ensures that traditional Jewish values are part of divorce proceedings is to use prenuptial agreements that are signed by both parties, allowing determinations to be made by the Beth Din of America, which is the largest rabbinical court in the United States.

In the 1983 case of Avitzur v. Avitzur, a New York court considered the enforceability of the Ketubah entered into as part of the religious marriage ceremony. The Ketubah is supposed to show the bridegroom’s intent to cherish the wife and provide for her, as well as the wife’s willingness to carry out her obligations according to Jewish law. The couple agreed to recognize the Beth Din of the Rabbinical Assembly and a Jewish seminary to have authority to counsel them and impose compensation as it saw fit for failing to respond to its decision appropriately.

Enforceability of Islamic Marriage Agreements in New York Made in Front of an Imam

August 7, 2016 | Law and Mediation Office of Darren M. Shapiro, P.C.

Under Islamic law, marriage itself is a civil contract, and both spouses must have the legal ability to make a contract to create an enforceable marriage. Traditional Muslim marriage contracts include a provision called mahr. The mahr is automatically a wife’s separate property under Islamic law, and it supposed to help the wife financially after the dissolution of a marriage and to discourage a husband from exercising the right to repudiate the marriage.

Before entering into a marriage contract, the parties customarily discuss the amount of mahr. However, it’s not “consideration” for the marriage, and the mahr isn’t a prenuptial agreement, according to Islamic attorneys and scholars. The actual giving of the gift is postponed to the dissolution of the marriage or the death of the husband. Within Islamic law, the mahr is considered a gift that a husband must give the wife once a marriage contract is concluded.

New York courts, however, have usually interpreted the mahr as a dowry or a prenuptial agreement, rather than a simple contract. If they are approached as a simple contract, mahr and other agreements before an Imam are likely to be enforced. However, prenuptial agreements in New York must also be in writing and signed before the marriage. Although there is no obligation to make financial disclosures, if they are voluntarily made, they must be true.