Month: October 2017

Dan v. Dan: Modification of Alimony in Connecticut Divorce Cases

This Week’s Blog by Eric J. Broder

The following is a discussion and summary of a seminal case when dealing with the modification of alimony in the state of Connecticut. Dan v Dan, 315 Conn. 1 (2014) has created quite a stir in the Connecticut divorce bar. It is an important case for practitioners and clients dealing with post-judgment alimony issues to understand. Below is an analysis of the case.

In 2000, a judgment of divorce was entered. The parties had been married more than twenty-nine years. They had three children, all of whom had attained the age of majority before the divorce. At that time of divorce, the Defendant’s base salary was $696,000.  The Agreement provided for the Plaintiff to receive $15,000 per month in alimony, as well as a sum equal to 25% of any bonus income that the Defendant received. The parties also agreed that the Defendant’s alimony obligation would cease when he reached the age of sixty-five or his retirement, whichever occurred first. The Defendant was 50 years old at the time of the divorce and the Plaintiff was 51 years old.

Ten years later, in 2010, the Plaintiff filed a modification of alimony, claiming that her medical expenses had “skyrocketed” and the Defendant’s income had increased substantially.   The Court found that the Plaintiff had failed to prove a substantial change in her circumstances because of an increase in her out-of-pocket medical expenses. The Defendant stipulated during the hearing, however, that he had a substantial increase in his income since the divorce and that this constituted a substantial change in circumstances.

In 2010, the Defendant worked excessively long hours to earn an annual salary of $3.24 million and an additional $3 million from cashing out stock options. At the time of the post-judgment proceeding, the Plaintiff was 61 years old, the Defendant 60 years old. Though the Plaintiff had several health problems, including diabetes that was poorly controlled, this was a circumstance which had existed at the time of the divorce. (The Plaintiff had no college degree and although she had once worked as a receptionist and executive assistant, she had not been employed since 1977.)

After addressing the statutory factors set forth in § 46b–82, the trial court granted the Plaintiff’s motion and increased the Plaintiff’s alimony award from $15,000 to $40,000 per month, plus 25% of any bonus in come that the Defendant received. The court modified the term of alimony to lifetime. In making its decision, the trial court focused on the length of the marriage, the health of the parties, the station and occupation of the parties, the amount and sources of income of each party, and the vocational skills of each party.

 The Supreme Court held that in the absence of certain exceptional circumstances, a substantial change in income standing alone was not sufficient to grant a motion to modify alimony.   The Court set forth a new inquiry to consider when the only substantial change is an increase in payor’s income: (1) Was the original award sufficient to fulfill the original purpose? (2) Does the award continue to fulfill the original purpose? The decision does not discuss in detail what exceptional circumstances might be.

In determining whether an alimony award should be modified when there has only been an increase in the payor spouse’s income, the trial court can only consider: the length of the marriage, the cause of the divorce, and the age, station, vocational skills and employability of the parties. However, these factors shall only be considered in the context of determining the initial intent of the alimony award.  They should not be considered as reasons for altering the purpose of the initial award.  The trial court does not have the discretion to retry issues that have already been decided.

The Supreme Court remanded for a new hearing because the trial court did not address the issue of whether exceptional circumstances existed in this case to justify a modification upward of alimony. The Supreme Court surmised that the original purpose of alimony in this case was to allow the Plaintiff to maintain the standard of living she had during the marriage. The trial court made no finding as to whether the original award continued to be sufficient to meet the original purpose of allowing the Plaintiff to maintain the standard of living she had during the marriage, which is a different question than whether her expenses are met.

Broder & Orland LLC featured in Greater Bridgeport Bar Association News Brief, October 2017

The September/October 2017 edition of the Greater Bridgeport Bar Association’s News Brief highlighted Broder & Orland LLC in multiple instances, including articles authored by attorney Sarah Murray and paralegal Stacy Koutikas. Sarah’s article discussed the importance of the prenuptial agreement, while Stacy, who also acts as the GBBA Paralegal Committee Chair, welcomed new members in her message.

Further, the edition offered an impressive press release on Powell-Ferri vs. Ferri, a landmark case in which Broder & Orland LLC represented the Husband.

Past editions of the News Brief, as well as upcoming events and helpful reference links, can all be found on the Greater Bridgeport Bar Association’s website.

Do I Need a Forensic Financial Expert in My Divorce?

In divorce cases at Broder & Orland LLC, we often add a forensic expert to our team. This is particularly true in the financial realm. Many of our cases emanating from Greenwich, Westport, and throughout Connecticut involve sophisticated financial structures, including interests in private equity, hedge funds, and venture capital entities. Disputes arise over valuation and issues like carried interest. It is therefore critical to involve a forensic with expertise in these areas.

Certain compensation structures involve stock options, restricted stock, phantom income, and deferred compensation. A financial forensic expert will assist counsel in analyzing documents so that nothing is left on the table. He or she will provide projections as to the realization of these items and help craft a mechanism for allocating them, sometimes “if, as and when” they are actually received, which is often after the divorce is finalized.

Another area requiring the involvement of an expert is the valuation of a business. The expert will review such items as tax returns, K-1s, profit and loss statements, balance sheets, general ledgers, operating agreements, partnership agreements, bank statements, and payroll documents. Additionally, the expert may do an analysis to normalize earnings to prevent double dipping, so that a reasonable compensation is extracted from the valuation of the business and not counted twice.

In other instances, we utilize a forensic expert to analyze spending in order to determine actual income. The expert will trace expenditures by reviewing bank account and credit card statements, as well as ATM withdrawals. It can be time consuming and laborious to pore over these documents, but it is especially necessary when a party has access to cash in a business.

We will occasionally involve an expert to trace offshore and foreign investments. The expert has access to a wide range of resources and industry tools that are helpful in tracking down these assets. He or she is well versed in analyzing and interpreting the data which is often complicated by design.

We also use forensic experts to analyze personal, partnership, and corporate tax returns. These returns often provide us with a trove of information which, when unscrambled by the expert, provides us with a clear picture of the parties’ finances. While experienced divorce counsel should have a good working knowledge of tax returns, we are typically not CPAs or accountants, and therefore consulting with such experts is often necessary.

So at what stage do we get the forensic financial expert involved? In our practice, it is often the very first call we make after our client retains us. Each expert brings personal strengths and perspectives to the case, and we want to make sure our client hires the optimal expert. Having our expert in at the outset also provides us with an overall understanding of the case and a roadmap as to the best and most efficient way to proceed. We have our expert design for us discovery requests which target the documentation we will need to prove our case, as well as to review and analyze those documents when we receive them.

We often use our expert during negotiations with our adversary, who most often has an expert as well. Many times, counsel instructs the two experts to talk to each other in order to resolve disputes and to assist in settling the case. This works particularly well when both experts are highly reputable and experienced and when they have mutual respect for one another. In many instances, we have our expert prepare us for depositions involving finances and sometimes we have our expert sit in on the deposition to assist as needed. A skilled expert can also be very valuable in the type of mediation we sometimes employ just prior to trial, where the model involves a former judge or esteemed member of the bar, counsel, and clients. It is usually the last best chance to settle the case and a talented expert can often be instrumental in arriving at a resolution.

Finally, in cases where trial is the only option, the financial forensic expert will not only assist in preparation, but also testify during the proceedings. The Court must qualify the expert before he or she can testify to substantive issues and before being allowed to render an opinion. Experts we use have been qualified many times in courts throughout the state, so it is rarely an issue in cases we handle. If an expert is to testify, counsel has previously filed a document known as an Expert Disclosure, which, according to our Rules of Procedure, Section 13-4, includes the field of expertise and the subject matter on which the witness is expected to offer expert testimony; the expert opinions to which the witness is expected to testify; and the substance of the grounds for each such expert opinion. A well-drafted Expert Disclosure, prepared with the assistance of an experienced expert, will prevent any qualification and evidentiary issues at trial.

At Broder & Orland LLC, we have included financial forensic experts to our team in a multitude of cases. We know which expert is best suited for a particular matter and are adept at maximizing that person’s expertise to achieve the best results for our clients. While hiring an expert appears to add cost to the case, in the long run, it usually makes for a more cost effective way of developing that case and typically maximizes the financial results for the client. In short, it is most often money well spent.

Five Attorneys Named as 2017 Super Lawyers®, October 17, 2017

Super Lawyers® selects outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement. Each year, no more than 5% of the lawyers in the state are selected to receive this honor.

Broder & Orland LLC is pleased to announce that five of our attorneys were designated as 2017 Connecticut Super Lawyers®. Congratulations to Carole Orland and Eric Broder, as well as Lauren Healy, Sarah Murray, and Chris DeMattie, who were named as Rising Stars!

Learn more about the Super Lawyers® selection process here.

Broder & Orland LLC is a Proud Sponsor of Pink Aid, October 2017

Pink Aid’s mission is to help underserved local women survive breast cancer treatment with support and dignity, to provide screening to women in financial need, and to empower breast cancer survivors to heal by helping and inspiring others.

October 5th marked the 7th annual Pink Aid Luncheon and Fashion Show. Broder & Orland LLC is a proud sponsor of Pink Aid and commends the work it does to support women throughout Fairfield County.

 

Eric J. Broder honored as NAFLA Featured Attorney, October 2017

The National Academy of Family Law Attorneys (NAFLA) “is an organization devoted to recognizing the top family law attorneys in the nation.” Each week, NAFLA showcases several carefully selected attorneys from across the country in order to celebrate their hard work and dedication. Broder & Orland LLC is proud to announce that co-founder and partner Eric Broder received the honor of a feature on the site’s home page this week!

See more on Attorney Broder’s feature

Alimony in a Divorce Action: What Factors Does a Court Consider in Entering an Order During the Pendency of an Action and as a Final Order?

Many clients come into our office from the towns of Fairfield County wondering whether they will be obligated to pay alimony to their spouse, or whether they will be receiving alimony from their spouse during the pendency of a divorce action, and/or upon the Court entering a final decree of divorce. While the Court may order either party to pay alimony to the other, the amount of alimony ordered and the duration of time that a party may be directed to pay alimony is not straightforward.

Pursuant to Connecticut General Statutes Annotated (“C.G.S.A.”) § 46b-83, the Court has the authority to enter order(s) concerning alimony during the pendency of a divorce proceeding (“pendente lite”).  The Court also has the authority to order alimony at the time of entering a final decree pursuant to C.G.S.A. § 46b-82. In entering an award of support, the Court shall consider several factors enumerated by statute, including but not limited to the following: the length of the marriage, the causes of the breakdown of the marriage, the age, health, station, occupation, amount and sources of income, earning capacity, employability, estate and needs of each of the parties in determining whether alimony shall be awarded, and the duration and amount of the award. In entering an award of alimony, while the Court is required to consider the factors enumerated by statute, it need not give each factor equal weight so long as the Court has considered all of the statutory criteria.

During a contested court matter concerning spousal support both parties will present evidence related to the criteria set forth by statute. The evidence presented may include information concerning each party’s educational background, his or her earning history, whether there are children to the marriage and each party’s ability to continue working and/or return to the workforce given this factor, as well as expert testimony on matters such as each party’s earning capacity and/or employability.  After a Hearing on the merits, the Court will then enter an order of alimony, setting forth the duration and amount of alimony to be awarded.

As a practical matter, the alimony duration will vary depending on the length of the marriage and the ages of the child(ren) if child(ren) are involved.  The amount of alimony will also vary depending on any child support component, and whether one or both of the parties are currently working and/or have the feasibility to continue working.  In establishing an amount of alimony awarded, depending on each party’s income structure, a Court may order for a party to pay the other a percentage of his or her income, but other times a party may be ordered to pay a specific monthly amount.  There are also circumstances in which it would be inequitable at the time of entering the alimony order for the Court to even establish an amount of alimony to be awarded.  However, rather than preventing a party from receiving alimony in the future, the Court may preserve that party’s right to return to Court to seek alimony during the alimony term.

At Broder & Orland LLC we understand the financial constraints that a pending divorce can pose on both parties to a divorce, and the importance of establishing an equitable amount and duration of alimony. We are adept at advising our clients on the strategies and the multitude of factors considered by a Court in establishing an alimony award. We also recognize the emotional and financial stress that a contested divorce proceeding can pose on the parties and we are empathetic to our clients’ needs.

Substance Abuse and Parenting During a Divorce

Substance abuse can create issues for many families and can play a significant role in a large number of divorce cases, especially those where there are minor children. At Broder & Orland LLC we have experience in handling divorce cases involving this issue throughout the towns of Greenwich, Stamford, Darien, New Canaan, and Westport. A divorce can be challenging enough on its own, but when one or both parties struggle with substance abuse, it creates added complications and can make the process seem insurmountable to the children and parties involved. Substance abuse in one form another can cripple a couple and devastate a family. It is also common for persons suffering from substance abuse to physically or mentally abuse their spouse and/or children. At Broder & Orland LLC we offer the experience and resources to understand and work through the specific issues of each case, including substance abuse.

Navigating a divorce with children when one or both parties have a substance abuse problem often requires a delicate approach. For example, one party may be fearful that his or her alcoholic spouse will drink and become intoxicated during parenting time with the children, or even worse, get behind the wheel of a car while intoxicated with the children. On the other hand, a spouse who is a recovering addict may worry that parenting time will be limited due to his or her past issues and behaviors.

Due to competing interests, it can be difficult for parties to agree on a Parenting Plan that each party believes is in the child’s best interest. The parties, their attorneys, and the Court must balance the competing interests all while making sure that any decision made or order entered into is in the best interest of the children.

There are multiple ways to ensure a child’s safety and properly deal with parenting issues in a dissolution action where one party has substance abuse issues.  One of the first steps that can be taken is to involve neutral third-party professionals, such as a Guardian Ad Litem. A Guardian Ad Litem is appointed by the court and is tasked with determining what is in the child’s best interest. A Guardian Ad Litem is also often able to speak to a party’s therapist or treatment provider to better understand a party’s mental and physical state and the impact it may have on the child.

A second way of ensuring the safety of all parties is to file a Motion with the Court asking that a party be randomly tested for drugs and/or alcohol. For alcoholics, this often means providing the party with a device that will randomly require him or her to participate in a breathalyzer test. The results of the test are then immediately sent to the test administrator. The usual protocol is then for attorneys to be notified if and when the party fails or misses a test. After a failed test it may be agreed to that all further parenting time is suspended or that the parent who failed a test may only exercise parenting time under supervision by another person.

A third option is to file a Motion for Supervised Visitation. This Motion asks the Court for an Order whereby all parenting time must take place in the presence of a third party. The third party may be Court appointed or may be someone mutually agreed upon by the parties. The goal is of course to protect the children and allow the parent to demonstrate their ability to parent appropriately.

In the Connecticut judicial system it is easy for families suffering from substance abuse to feel overwhelmed and helpless. At Broder & Orland LLC we have the ability to guide you through the process and ensure your safety and your children’s safety.

Near & Fair Aid Golf Classic a Success, September 2017

The Near & Fair Aid Golf Classic took place at the Country Club of Fairfield on September 14, 2017. Attorney Lauren M. Healy acted as co-chair of the event, while Broder & Orland LLC further contributed as one of several prestigious program sponsors.

Click here to access more information about the 2017 Golf Classic and the impressive work that Near & Fair Aid does throughout Fairfield County.