Having just finished one of these, I searched our database and noted that we had written very little about it.

In my case earlier this week, my adversary and I had been negotiating a child support order. After several rounds, we reached a mutually acceptable conclusion. When I wrote to confirm our “terms” I received a responsive email that the child’s father wanted to claim the child as a dependent on his federal income tax returns “every other year.”  My client would justly ask:  What does that concession mean and what is it worth?”

If you do your own income taxes at the federal level, you know that on page 1 of the return you are asked to name your “dependents” and on page 2 you can claim a deduction reducing your taxable income by $4,000 for every eligible dependent including yourself. So if Mr. and Mrs. Hubbard are living in the same shoe and they have two minor children, they can take a total of $16,000 in exemptions (i.e. deductions) from their income ($4,000 x 4).  But what happens when Father Hubbard splits to live with another storybook character?  Clearly, if the Hubbard’s continue to file joint returns, nothing much changes.  But Father Hubbard is now paying some deductible alimony to Mother and he needs to file separately in order to claim it.  And since he is paying child support as well why can’t he deduct at least one of the kids?

Well the Internal Revenue Service is on this and since 1984 they have taken the position that the deduction associated with a child goes to that parent who had primary physical custody.

The parties can agree to split the deductions (one parent takes each child) but absent an agreement, the deduction stays with the parent who has the kid most of the overnights, even though the non-custodial parent may be paying most or all of the freight. More recently as we have seen increases in shared physical (50/50) custody, the service has held that the deduction in that instance goes to the parent with the larger adjusted gross income.  See our blog on this 11/1/12.

As we have noted, the deduction can be traded and the IRS has a Form called No. 8332 that allows parents to do that. So what is the deduction worth?  $4,000 right?  Well, not so fast.

The real value of the deduction depends on your taxable income for single folks with taxable income under $10,000; the deduction is only worth 10% of the face amount or $400. But for a head of household with taxable income over $50,000 it is worth 25% or $1,000.  Get that taxable income up into the $200,000 range and the deduction accelerates to 33% or $1,320.  The value of the deduction tops out at 39.6% or $1,584 but your taxable income has to top $400,000 to get that amount.  Beware that as adjusted gross income (AGI) starts to exceed $150,000 the IRS begins to nibble away at the value of the exemption through a “phase out.”  For many high income taxpayers, there is effectively no personal exemption to deduct because of the phase out.

One other thing to know. Assigning the exemption to another does not affect a taxpayer’s right to be a head of household and to use those slightly lower tables in determining the actual tax due. But one thing is clear; while dependency exemptions do reduce your taxes, they do not do so dollar for dollar. An exemption is, at best worth the equivalent of $110 per month and, at worst worth about $35 monthly.

N.B. IRS Publication 504 is the best place for a layperson to consult on line.  Every one of the rules described above has a plethora of exceptions.

A Friendly Amendment To Our Blog On Dependency Exemptions:

I heard from one reader with a very apt point. As income rises, into levels above $150,000, the dependency exemption does phase out and there is a level where it disappears completely.  So I was incorrect to suggest that it has a minimal value.  It can be zero and you certainly don’t want to get into a fight over “nothing.”

One of the things the Pennsylvania Bar Association makes a part of its mission is to review and, where appropriate, comment on legislation introduced for consideration by the General Assembly. These proposed laws cover a large swath of public policy territory.  Earlier this year the legislature passed a bill creating a presumption of consent to divorce where a violent crime had occurred between spouses.  Today there is a bill to reduce the separation period required to obtain a consent divorce from 2 years to 1.  It may well pass before the end of the month. There is another bill to affect how custody proceedings may change upon a parent’s military deployment.

The Family Law Section was recently asked to comment on House Bill 1975, a bill introduced by Representative Todd Stephens of Montgomery County and 18 of his colleagues imposing interest on support arrears. While this writer sees limitations in the bill as currently drafted, the subject is one that certainly merits legislative consideration.

The nub of the problem can be described as follows: Two parents separate on January 1, 2016 and parent A has primary custody of their child.  Parent A applies to the court for a child support order and on March 1, a conference is held and an interim order of $1,000 a month is issued.  The Court instantly attaches the wages of Parent B and the matter is referred for a hearing to establish a final order.  That hearing takes place on June 1 and a decision is rendered setting support at $2,000 a month on June 30, 2016.  This means that the support account would be set at $12,000 (6x $2,000) against which there would be credits for the $4,000 for those payments collected under the interim order (Mar, Apr, May, Jun).  Thus the account would show what lawyers call an arrearage of $8,000.  The technical legal term is called “past due support.”  When it enters a final order, courts are also supposed to address liquidation of the past due support.  Typically, courts add 10% to the order to reduce the arrearage over time.  An award of $2,000 would be increased to $2,200 per month with $200 being applied to eliminate the $8,000 arrearage.

Those facile at long division and the “time value of money” will see the immediate inequity. Parent B paid no support for two months and half the correct amount of support for the next four months while the final order was being decided. At $200 per month it will take 40 months to pay off the overdue support.  At the legal rate of 6%, the interest that should be applied to this payout would be about $48 per month or $1,920.  But under prevailing law, Parent B gets the payout interest free.  So, the effective rate of the payout is not $200 a month but $152.

House Bill 1975 does not change this if Parent B unfailingly remits $2,200 per month as the June 30 order mandated. But if Parent B, fails to make the correct payment amount each and every month, the “past due support” becomes “overdue support.”  And that is not just the particular missed payment but all past due support (arrearages).  Under Bill 1975, if Parent B paid only $2,100 per month in September, 2016, all past due support would become overdue and subject to interest at the legal rate of 6%.*

*The proposed bill applies interest at 6% or Wall St Journal Prime +1%, whichever is greater.

The statute does not specify the date the interest would be calculated from. Should it be from the date the case was initiated; the date the order became final or the date of the default. There are meritorious arguments for all three dates.

But there is also reason not to apply these interest rates or to apply them at a rate that is today 25% above prime rate. One cannot reasonably defend an interest free loan of what the law defines as essential support for dependent minor children.  On the other hand, many if not most support obligors incur unusual expenses at separation (e.g., moving, rental or home purchase deposits and related soft costs) and the economies of one family under one roof are erased.  Another concern is the new trend toward spasmodic employment.  In the past decade employers have increasingly relied on computer models to instantly add and/or terminate employees.  Payor parents who find themselves terminated often forget to put on their “to do” list a visit to modify support based on unemployment.  So the employee who neglects to make $2,200 a month payment in the month immediately following his/her termination risks falling into the “overdue support” bin that would trigger interest rates at a time when the payor is least able to make the full payment.  Presumably, this might be rectified in subsequent modification proceedings but that requires recalculation of not only the support but any interest which began to accrue.

In a conference call of the state bar association’s family law section, the discussion focused upon the complex interest algorithms that would need to be written to trigger and calculate interest and to revise those numbers if, as, and when a modification is granted. In our example Parent B pays his $2,200 in July, August and September but is fired on September 30 and pays only $1,000 in October.  Now his past due support is overdue support and the computer calculates and adds interest to his arrearage.  In November, he applies for a reduction and in January, his support is modified to $750 a month because his income is vastly reduced.  Are we still charging interest on $7,400 arrearage balance at 6% despite his reduced condition?

Lest we be accused of shilling for the payor, the plain fact is that there are times when lengthy payouts of past due support should be subject to some form of interest. Often Courts routinely apply their unwritten 10% on arrears rule despite the fact that the parties have large deposits that could easily satisfy the arrearage.  At its worst, in one case, the arrearage on a $45,000 a month order was well in excess of $1,500,000.  Despite the fact that the payor had reported income 5x the arrearage, the Court ordered a token payment of $5,000 a month in reduction of the past due amount.  The effect was a 26 year interest free loan.  The Superior Court deemed this alleged error to be harmless.  See Karp v. Karp, 686 A.2d 1325 (Pa. Super. 1996)

Is there a middle ground? Encourage courts to award modest interest to incentive Payors to liquidate their obligation.  Apply it to all final orders but allow it to be suspended where justice would make such accruals inappropriate in the court’s discretion.  This might create the proper tension between interest free payment of past due support and debilitating interest assessments against those not really in a position to pay interest.  Research provided to us by Summer Clerks Eunice Kim and Kelsey O’Neil informs us that 28 states apply interest on past due support and 40 states charge it on overdue support as H>B. 1975 suggests.  When states such as Alabama, Mississippi, and Arkansas are charging 7.5-10% interest, one has to ask whether this is another example of “Carville was right” except that we might be a little less modern.

For a list of which states charge interest and how search http://www.ncsl.org/research/human-services/interest-on-child-support-arrears.aspx

 

 

For those of you who practice in this area or are “regulars” in the child support system, you know that every four years, the statewide child support guidelines are due for an update. The purpose is to try to keep pace with the economic times and the cost of raising children.  For the 2008 and 2012 revisions, the Domestic Relations Procedural Rules Committee retained Dr. Jane Venohr of the Center for Policy Research in Denver, CO. to compile economic data.  Dr. Venohr is again involved in the 2016 process.

The Rules Committee published its proposed guidelines on April 21. For now, they are subject to comment from any interested individual and should be directed through Bruce Ferguson, Esquire (domesticrules@pacourts.us) as counsel to the Committee.  Once the comment period closes, a final version will be sent to the Pennsylvania Supreme Court for its review and decision.  Because the guidelines typically do not present policy issues, the Court has usually adopted the proposal without amendment.

The current draft guidelines make no substantive changes to the procedures by which a support order is established or modified. At the same time there is another proposed substantive modification to Pa. R.C.P. 1910-16-4(d) which may be adopted by the Supreme Court known as Recommendation 146.

Generally, the news is that costs have increased and so have the guidelines. The self-support reserve has increased 5.1% to $981.  Support for children has also increased.  Using two children for illustrative purposes, the amount of support to be allocated between the parents looks like this:

Combined income                              2012                      Proposed

5000                                                    1369                      1415

10000                                                  1981                      2044

15000                                                  2532                      2586

20000                                                  2997                      3052

25000                                                  3425                      3492

30000                                                  3836                      3902

Above 30,000                                      11.6%                    11.8%

Generally the increase ranges from 3.3% at the lower end to 1.6% at the top. The data analyzed to arrive at these values comes from September, 2015 data.  During this period the CPI for all Urban Consumers in the Northeast rose from 243.323 to 252.922.  One could suggest from this that the guidelines are not keeping pace.  But then the guidelines do not include the costs of health insurance and related expenses, which are allocated by net income “on top” of the guideline amount.  Needless to say, a major driver of consumer prices is the cost of health insurance and related care.  The same can be said for day care costs, which also travel outside the guideline amount.

We live in interesting times. We have recently reported on significant cases discussing who has legal standing to seek custody of a child and whether that “standing” comes with a child support obligation.  But one bedrock that has been around for a while is what is called the presumption that a husband is father unless someone proves he had no access or was incapable of procreation.

It has been a presumption which today stands despite the fact that science now allows us to show otherwise. Genetic testing has been around for about 20 years and today it is considered the standard.  But the presumption of paternity is an interesting one. “A” may sleep with “B’s” wife but if wife becomes pregnant and B decides that he wants to play dad, the fact that “A” can prove that he is the real father is of no consequence.  That’s the law of Pennsylvania although this author believes it has some constitutional weaknesses.

In M.L. v. J.G.M, a case decided on January 4, 2016, the two parties were married in 2001.  They separated in late 2011 and divorced in September 2014, they had one child together who is today 10 years old.

As is happening with some frequency, the once separated Father started to have some thoughts about whether his child was, in fact, his child. Today, paternity tests are freely available so he administered one on the child (typically it involves an oral swab) and the test came back excluding him as the father.  Almost two years after separation he filed a petition in Berks County to terminate support.  He also sought blood testing within the court system to confirm that his drugstore test was accurate.  Mother filed to prevent the test.  The Berks County Court ordered the blood test because the marriage was no longer intact and the parties having been divorced several months before the motion was heard.

But the battle did not end there. The Superior Court had to wrestle with the Supreme Court’s ruling in K.E.M. v. P.C.S., 38 A.3d 798 (2012).  There the court held that paternity by estoppel will apply only where the doctrine promotes the best interests of the child.  In that case the father continued to promote his role as father even after learning from a biological viewpoint that the facts were not with him.  The Supreme Court ruling contained an eloquent reflection on how the passage of time leaves the child with no hope of finding the actual parent and the clear harm of losing the only father the child had known.  The language is moving but, unfortunately, science “moved” faster.

In current case as well as an earlier Superior Court case decided in 2011 (R.J.K. v. S.P.K., 32 A.2d 3d 841), the matter was remanded to develop a full record including psychological testimony related to the bond between the child and the presumed father.  The opinion of Judge Lazarus does a thorough job of analyzing what courts are to look to when building that record. But, build it as you may, when the dust settles there are going to be some angry adults and a bewildered child.  Typically we assume that these children are accidents or the product of loose morals on the part of both biological parents.  But not every man who sleeps with a woman gets an honest answer about her marital status or her views on birth control even if he does inquire.

And the forgiving husband who adopts the child of the casual relationship despite the infidelity may not always remain so honorable or caring. The difficulty we face today is that anyone can buy and employ a genetic testing service.  So while a Court may rule that “B” is officially Father in the Courtroom and the schoolhouse, it can’t, in practical terms try to prevent “A” from reaching out to his child or compel “B” to maintain a physical or emotional relationship.  In this case, it appears that damage has been done as J.G.M. terminated contact with the child just after her eighth birthday.  We can label him “dad” and we can compel him to pay support for her. But we can’t make him love her or “fix up” a family for this innocent child.

Almost twenty years ago, I was appointed to a committee of the state bar association to address this presumption issue. I was and, remain in a decided minority when I suggested that there be mandatory paternity testing at the hospital before a child is released.  If that had been done in this case the cards would have been on the table.  And knowing that the testing would be required, many couples would be forced to be more honest early on.  The trouble is that far too often, a secret is kept and the longer it is kept, the more damaging it becomes to the child involved.

On September 28, 2014 Aaron Weems posted a blog in which he reported on a panel Decision of the Superior Court holding that a Father’s contractual undertaking to pay $10,000 to a Mother each time he sought to modify an agreed custody arrangement was enforceable. When the Mother sued to enforce the contract term and the Father filed objections stating that the contract was in derogation of public policy.  The Trial Court sustained his objections and Mother appealed.  The three judge panel decision reversed the trial court but the ruling was later withdrawn so that it could be considered by a full bench; nine of the fifteen commissioned judges.  The matter was argued in the Fall, 2015 and a new decision was issued on February 5.

The crux of the issue remains the same. The parties indeed made a contract containing this $10,000 modification “honorarium.”  When Mother sought to enforce Father (a lawyer) claimed that while he did sign the contract, the provision could not be enforced.  The law of contracts has long held that some provisions are against public policy and that those are unenforceable.  The typical examples are contracts involving illegal activities.  But Pennsylvania also has a long history of cases holding that agreements that limit child support are subject to being set aside where the Court determines that the arrangement does not promote the best interests of the child.  The Granddaddy of these cases is one where a Mother agreed to $5 a month in child support because she felt confident that helping the Father afford medical school would ultimately benefit their child.

The defendant in Huss v. Weaver 2016 Pa. Super. 24 tried to argue his way into the tent affording protection from his own agreement on the basis that paying the $10,000 charge was in some way bargaining the rights of the subject child.  The Superior Court was not buying that; noting that this was not money coming from support or a fund for the child, but Husband’s own resources.  The Court also found that the agreement in controversy contained a statement that Father was an attorney capable of earning “a large salary.”  It also distinguished a case where the Court voided an agreement that provided for one parent to pay the other parent’s legal fees if she later sought to modify the support agreement formed by the parties. Kraisinger v. Kraisinger 928, A.2d 333, 345 (Pa. Super, 2007).

There is language in this opinion which suggests that at hearing on this claim, the Defendant may be able to assert that he should be absolved of his contractual undertaking if he could show that the $10,000 payment was an impediment to his seeking modification of custody. See Slip opinion at p. 12. That, however, is not a basis to hold the agreement as violating public policy on the basis of the pleadings.  The case was remanded for hearing.

Four of the judges joined in a concurring opinion that cautioned the trial court that if the Defendant develops the right record, he might win. Penalty provisions that do not relate to actual damages are not favored in law.  The concurring opinion also notes that if facts were established that the $10,000 payment was impeding a bona fide action to protect the interests of the child, the court might come out with a different result.  So in the end, all we really know is that this kind of payment clause is not per se a violation of public policy but that its invocation will be viewed with suspicion even when agreed.

In a year when there have been relatively few published opinions and few of those offering much precedential value, the year ends with an important ruling by the Pennsylvania Supreme Court.

The question in A.S. v. I.S. (8 MAP 2015) revolved around the matter of when a step-parent can owe child support.  In this case, a mother gave birth to children in Serbia in 1998 and later married the Defendant. Together they brought the children to America and the Serbian father of the children lost contact by 2006.  In 2009 Mother and step-father separated.  In July 2012 Mother expressed an intention to move to California.  Step-father filed to prevent that asserting that he was in loco parentis (in the place of a parent) and as such had custody rights under the statute governing standing.  Standing was sustained and the custody case concluded with the parents being awarded shared legal and physical custody of the children.  No doubt chastened by having her plans to relocate foiled, Mother filed an action for support to which step-father objected stating that his position in loco parentis did not imply a financial duty to the children.

Father’s position was sustained by both the trial and Superior Courts. Mother petitioned the Supreme Court to hear the matter and review was granted.

The 3-1-1 decision issued on December 29, 2015 does not establish a bright line test. Fundamentally, it sustains the view found in Com. ex rel McNutt. v. McNutt that step-parents are not generally liable to support children who are neither their progeny nor their adopted children. 496 A.2d 816,817 (Pa. Super. 1985).  See also DeNomme v. DeNomme, 544 A.2d 63,65 (Pa. Super. 1988)   It also approves the holding in Drawbaugh v. Drawbaugh, holding that assertion of “minimal” continuing contact with a step-child does not trigger a duty of support. 647 A, 240,242-3 (Pa. Super. 1994).

But here, step-father’s action to prevent mother’s relocation and his pursuit of shared legal and physical custody was enough to upset the general rule.

Noting that this case was analogous to L.S.K. v. H.A.N., 813 A.2d  872 and Fish v. Behers, 741 A.2d 721 (Pa. 1999) which dealt with facts giving rise to a form of equitable estoppel, Justice Baer writes that where a party assertively hold himself out as a child’s parent, that party may be held to the correlative duties of a parent.  He notes that step-father in this case assumed and vigorously pursued parental duties in trying to halt the relocation and in pursuing shared custody.

As noted, this is not a bright line test. One can read the majority language in page 13 of the opinion as holding that a step-parent may cross the “support” line by invoking judicial remedies of any kind.  Such an interpretation appears to be inconsistent with Drawbaugh. So finding the line where support may be due from a step-parent may not be easy but it seems clear from this case that stopping relocation and then securing shared custody is “enough.”

The opinion does also present a conundrum of sorts. The parties separated in 2009.  Step-father filed for divorce in 2010.  His complaint for custody was not filed until 2012.  All we are offered about the period between the 2009 separation date and the 2012 filing date is that the parties “informally shared custody of the children.”  We don’t know what that three year “sharing” involved in a physical sense and that prompts the question of how soon after a separation must a step-parent act to assert in loco parentis before he or she loses that status. Alternatively, what kind of sharing effectively “tolls” any temporal limitation?  In an age when serial live in relationships without benefits of marriage are increasingly the “norm”, can Boyfriend 1 sue for custodial rights when mother and child now reside with Boyfriend 3.

On October 5th of this year, the Superior Court disposed of an alimony modification request that was decided by the trial court in October, 2014.  The facts and the ruling present a tale of how divorce practitioners need to pay heed to language when modifying an order of alimony.

Egan v. Egan, 2015 Pa. Super. 2013 was decided in Montgomery County, Pennsylvania but began as a divorce in Montgomery County, Maryland.  In 2002, the Maryland Court issued a divorce decree with an alimony order providing for one year of alimony at $4,000 per month and then alimony of $3,000 per month “thereafter.”   In 2004 the former husband filed to register the alimony award in Montgomery County, Pennsylvania and in April 2005, the parties formed a stipulation that transferred both the alimony and child support to Pennsylvania.  The Pennsylvania order made several modifications to alimony, child support and arrearages.  The Pennsylvania Order contained a provision that should father succeed in reducing his child support, his alimony obligation would have a corresponding increase.  We have seen these kinds of arrangements in agreements for many years, but this is the first time we have seen this discussed in an appellate case.  If Father petitioned to decrease child support, the agreed upon increase in alimony was also to render the revised alimony number, non-modifiable.  This agreement was made an order of court in April, 2005 in Pennsylvania.

In February, 2013 Husband/Father filed in Pennsylvania to modify the alimony.  Wife/Mother countered that the alimony was non-modifiable because what was submitted in 2005 was a stipulation or “agreement”.  In a ruling made without a hearing, the trial court ruled as a matter of law that the 2005 document was an agreement under Section 3105 of the Divorce Code and therefor was not subject to modification.  It also held a hearing on Wife’s counterclaim and held Husband in contempt for failure to comply with the 2005 stipulation.  Husband or rather ex-husband appealed.

Because the Maryland divorce decree mandated payment of indefinite alimony, it appears that the Pennsylvania court viewed the alimony award as modifiable as registered here in 2004.  But the “agreement” to modify the alimony and child support provisions of the Maryland decree after registration in Pennsylvania was “agreed”.  The Superior Court ruling is a determination that in resolving the modification of alimony by “agreement”, the parties took an order that otherwise was subject to modification under Section 3701(e) and converted it to an agreement under Section 3105(c).

Section 3105 (c) states that an agreement regarding disposition of existing alimony shall not be subject to modification absent “a specific provision to the contrary.”  In this case, husband argued that Section 3105 governed only those cases where there was a comprehensive agreement.  The Superior Court rejected the argument that agreements under Section 3105 need to be comprehensive, holding instead that if he wanted his 2015 modification to continue to permit further modification, that language needed to be written into the modification instrument.  His argument that alimony was modifiable because he never did seek a modification in child support was rejected for similar reasons.  By reaching the agreement embodied in the 2005 stipulation, husband took an otherwise modifiable alimony order and transformed it into a non-modifiable agreement.

The opinion discussed at length the policy reasons behind the difference in modifiability between Court ordered and agreed alimony.  In a word, the view expressed is that parties to an agreement understand that non-modifiable alimony under Section 3105 is a fundamentally different animal than agreed alimony under Section 3105, and that the parties have to understand that when they negotiate agreements.

The net of the ruling is that a party seeking to modify judicially ordered alimony needs to understand that unless the right to modify again is clearly enunciated, the right is lost where an agreement is reached.  This might be said to have a chilling effect upon such agreements, but the Superior Court found the statutes in controversy to be unambiguous.  It also found the argument that the unmodifiable alimony obligation was onerous (62% of payor’s net monthly income) to be unworthy of consideration.

To the practitioner, the lesson is to draft alimony modifications with great care. To the layperson, the lesson is, do not try to modify your own alimony orders without someone with experience looking at your modification documents.

 

 

Ashley Madison Data Breach only Slightly Less Obvious
Ashley Madison Data Breach only Slightly Less Obvious than Lip Stick on the Collar

 

When I first heard of the Ashley Madison data breach, I seem to be one of the few family law attorneys who felt somewhat cool to the idea it was going to result in a crescendo of divorce filings. First, due to Ashley Madison not having an email verification protocol, the presence of an email on the list is not in any way a confirmation that the legitimate owner of the email registered it with the website. Secondly, I had to assume that anyone with common sense was not using a “real” email and the chance for exposure would be minimal. Thirdly, I assumed that of the millions of identified users, perhaps a smaller percentage were active users and a portion were fake emails or users who registered as a goof; I imaged a much smaller pool relative to amount of registered users. Finally, I considered the other spouse and whether they would have the wherewithal or suspicion to search for their spouse’s email (emails?) among the users. Overall, I imagined a smattering of “Ashley Madison motivated divorces” being reported, but nothing that would move the needle on average filings.

If initial reports are accurate, I clearly overestimated the common sense of many Ashley Madison users and grossly underestimated their laziness in not opening anonymous, dedicated email accounts to register to the site.

Now that the data has been dumped and various websites are combing the data for notable users and email suffixes, I am much more certain that there will be some serious fall-out for relationships, certainly, but also for the employment of users. The news coverage surrounding the breach also brought to light what might end up being the most relevant aspect of the breach for any future divorce cases: the expense. Again, while the presence of an email is not dispositive of use, the credit card records are pretty conclusive.

Based on the price scaling reported, a motivated philanderer could rack up a fairly significant bill on Ashley Madison before they ever get to their first illicit rendezvous. When you factor in the costs of carrying on an affair (i.e. meals, travel, and gifts) the expenses increase exponentially. Each dollar applied to the affair is a dollar inappropriately dissipated from the marital estate.  Once the affair is exposed and a case is in litigation, a forensic accounting of bank accounts and credit cards will occur and eventually the financial scope of the affair will emerge.

The affair, in of itself, may not have a tremendous impact on a case since equitable distribution in Pennsylvania is blind to the bad actions of parties (unless those actions have a financial impact on the estate). For members of the armed forces, however, adultery is a punishable crime which could lead to dishonorable discharge and loss of financial benefits, such as pensions. Losing a pension adversely impacts not just the service member, but the service member’s spouse. Losing a retirement account due to such behavior would undoubtedly be argued as a dissipation of that marital asset and with the value of the lost pension being assigned to the service member and corresponding assets given to the spouse (assuming there are any).

Other people may be in sensitive positions involving confidential data or public positions where the appearance of impropriety from an exposed affair has a greater impact than whether the affair affects their ability to do their job. Losing a job over an affair could be interpreted as a “voluntary decrease” in income, not unlike being fired for cause or voluntarily taking a lower paying position to avoid a support obligation.

The real story about Ashley Madison data drop is not the salacious exposure of people seeking out affairs, but the breach of security for an organization relying so heavily on confidentiality – their entire business model and marketing campaign hinges on it. Go see our blog on data security for more information on such topics.

What will continue to generate news for the coming weeks, however, will be the cases where Ashley Madison data will be presented as evidence for economic loss in divorce or support cases, and the jumping off point for investigations into certain registered users. After the initial fireworks of the disclosures, this will be a slow burn story as more people are exposed and the repercussions are felt. The easy joke is that this is a boon for divorce lawyers, but I think it will be the family therapists and accountants who end up the busiest in the end.

(Photo Credit: Copyright a href=’httpwww.123rf.comprofile_toniton’toniton  123RF Stock Photoa)

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Aaron Weems is an attorney and editor of the Pennsylvania Family Law Blog. Aaron is a partner in Fox Rothschild’s Blue Bell, Pennsylvania office and practices throughout the greater Philadelphia region. Aaron can be reached at 610-397-7989; aweems@foxrothschild.com, and on Twitter@AaronWeemsAtty

In February we mentioned the introduction of a bill in the Pennsylvania state Senate which would allow the termination of a rapist’s parental rights, but preserve the victim’s (and state’s) ability to seek child support. The bill progressed through the Senate by unanimous vote recently and is now headed to the state House of Representatives for consideration. This was introduced by Republican Senator Randy Vulakovich of the 38th District (Allegheny Co.; Pittsburgh area) and is an important bill to protect the rights and dignity of rape survivors and their children. Though the number of cases this law impacts may be few in number, it should never be a possibility for even a single case. I expect this bill will be passed by the House and signed into law by Governor Wolf later this year.

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Aaron Weems is an attorney and editor of the Pennsylvania Family Law Blog. Aaron is a partner in Fox Rothschild’s Blue Bell, Pennsylvania office and practices throughout the greater Philadelphia region. Aaron can be reached at 610-397-7989; aweems@foxrothschild.com, and on Twitter @AaronWeemsAtty.

Recently the Superior Court considered a case in which a party died during the pendency of a support action. In the divorce case for Moser v. Ronald R. Renninger, et al., No. 1065 MDA 2014, the husband and wife were separated with the wife having filed for divorce and sought spousal support against the husband, receiving an interim support order of $394.10 per month plus arrears in an unspecified amount.

As an interim order, this matter was scheduled for an evidentiary hearing and designated complex which allowed the parties to conduct discovery (typically “simple” support cases do not permit discovery). Approximately two months after the interim order was entered, the husband died and, without having established grounds for the divorce, the divorce action and the husband’s estate filed a motion to terminate the support action and Support Order on the basis that without a divorce action, alimony pendente lite is not available to the wife.

While the wife agreed that the support obligation terminated upon the husband’s death, she argued that it is appropriate to apply a support order to the estate for the purposes of paying the accumulated arrearages. Basically, wife argues that she is a creditor to the estate.

At trial, the court found that wife could proceed with an arrearage-only spousal support case. On appeal, the estate asked the Superior Court to consider: 1) whether the failure to dismiss the support case is an error of law and an abuse of discretion; 2) that the record does not support finding that wife is entitled to receive spousal support; 3) error of law and abuse of discretion were committed in miscalculating (husband’s) income.

Though acknowledging that she was no longer eligible for APL, wife pursued her claim for a separately filed spousal support action and disputed that such action necessarily abates with husband’s death.  The Superior Court followed the reasoning of the trial court in finding that while a support order cannot be entered post-death, the interim order was valid and wife could continue her support action on the basis that a surviving spouse can collect unpaid support from the estate of the deceased spouse.

For the second issue, the estate attempts to argue that the husband had a defense to spousal support. Unlike APL which is a statutory entitlement to the dependent spouse, the payor in the spousal support case can offer defenses to the payee’s entitlement to spousal support. In this case, the estate points to trial court’s failure – in their opinion – to adequately consider a protection from abuse petition filed by husband and that wife voluntarily deserted husband.  The trial court, however, noted these events and cited that both parties filed PFA’s and both voluntarily withdrew them. Mutual allegations of abuse, the trial court reasoned, are inadequate defenses to a duty of support.  The Superior Court again sided with the trial court’s reasoning.

The final issue involves the calculation of husband’s income. The estate contends that the trial court improperly allowed evidence which was not authenticated and failed to consider the husband’s 2011 tax return. Basically, the estate objected to the introduction of PACSES records generated as part of the support conference on the basis that it is hearsay requiring authentication by the custodian of records. The support master found the information provided to be maintained by the Pennsylvania Department of Labor and reliable.

The trial court acknowledged the problem of authentication and that the record did not fall within an exception to hearsay evidence.  The Superior Court agreed with the trial court, however, they also cite the trial court’s reliance on corroborating evidence which established husband’s income and supported the records offered at the master’s hearing. So while an authentication and hearsay issued existed, it was not enough to justify remanding the case back to the trial court.

While the support case terminated, the wife remained a creditor to the estate. This case highlights a few issues, but the more important being that the death of a party without grounds having been established may not justify stopping all the actions in the case. Careful consideration must be made of what can abate and what requires the court’s review.