On April 30, 2019, the Superior Court published a panel decision related to a retirement benefit divided in divorce.  This wasn’t just any pension, but one established for a Pennsylvania municipality.  As this author learned in organizing a recent seminar for the Doris Jonas Freed American Inn of Court, municipal pensions are a very special and unwieldy animal.  The decision in Conway v. Conway v. City of Erie Police Relief & Pension Association demonstrates why.

The facts are easy.  The Conway’s married in 1991 and separated in 2007.  Husband was a cop in Erie, Pennsylvania.  On August 19, 2016 they executed a Property Settlement Agreement by which husband would transfer to wife $30,000 from his Erie Deferred Compensation Plan and “a share of his pension,” via a Qualified Domestic Relations Order (QDRO).  The educated reader is stopping here to ask, “what share?”  A great question, but not one addressed in this case.

Municipal pensions are not the creatures of state or federal law.  State law authorizes them, but the plans are governed by municipal ordinance.  Erie’s 2011 pension ordinance expressly allowed for QDRO’s, and that such Orders could grant a former or surviving spouse a share of the employee’s pension.

The parties must have known that something was brewing in Erie’s City Council because they were divorced three days after the Settlement Agreement was signed.  But before they could race a QDRO through the courts, Erie passed an amendment to its Pension Ordinance expressly forbidding former spouses from acquiring any interest in a municipal pension.

The QDRO was drafted and submitted to the pension administrator six days after the new Ordinance was passed, seven days after the Decree incorporating the Agreement was entered. The Plan administrator rejected the QDRO because it did not conform to the current Ordinance. Wife appears to have sued to join the Pension Plan as an additional defendant and secure an order compelling it to honor the Agreement formed before the Pension Ordinance was changed. The Erie County Court decided in favor of the Plan noting that the amendment preceded the pension administrator’s receipt of the QDRO.

Wife appealed not to Commonwealth Court but to the Superior Court.  In a lengthy footnote, the Superior Court concludes that it is not the Pension Plan’s rights that are involved, but those of the employee.  This argument seems attenuated as the assets of the pension plan would seem to be the property of the Plan subject to the claims of its creditors, viz., the employees who are Plan participants.  A quick and incomplete search of pension cases decided in recent years seemed to show they were all brought to the Commonwealth Court as municipalities and their plans are creatures of statute.

As if matters were not complicated enough, husband had the misfortune to die a few months after the trial court decision.  This foreclosed any power a court might have asserted to modify the equitable distribution based upon impossibility.

Wife argued and the Superior Court ruled that her rights to the pension vested at execution of the Property Settlement Agreement and a subsequent amendment of the plan could not alter those vested rights.  The Appellate Court relies upon the law of contract to state that the courts are bound to apply the intent of the parties.  It then recites familiar principles of equity and even notes that wife could be without a remedy as husband has died.

Were the pension plan a mere custodian of funds as one might conclude with the deferred compensation plan, (which appears to be a define contribution plan) this argument might glide by easily.  However, a defined benefit plan of this kind is a contract between a municipality and a labor force employed by the municipality by which the latter agrees to pay money to the Plan, which agrees to pay annuities in accordance with prevailing municipal law.  Therefore, we have a couple of contracts here and we have a municipality, which would seem to have the right to alter or even discontinue a pension benefit.  Principles of equity and administrative law do not often work in harmony.

Having said that, husband worked and part of his compensation consisted of deferred retirement benefits paid on his behalf by the municipality to the pension plan.  He accrued those rights and he assigned a portion of those rights to his former spouse at a time when the Plan document expressly allowed assignment via QDRO.  Arguably, had he accrued marital benefits after the Plan was amended to exclude assignment, those benefits would not be assignable.  Nevertheless, this is an issue where some reference should have been made to the collective bargaining agreement with the Erie police.

In the end, the former spouse got her pension and that is the right result.  However, this case demonstrates just how unregulated the world of municipal pensions can be.  Since passage of the Retirement Equity Act in 1984, private pensions regulated by the U.S. Department of Labor are assignable under 26 U.S.C. 414.  But, state and local units of government are not subject to federal regulation in this area.  The Commonwealth has adopted statutes that closely mirror federal law in the area of assignability for state employees.  Here, however, a municipality of nearly 100,000 residents decided to pass regulations rolling back spousal assignment provisions.  A person who marries an Erie cop in September 2016 could stay married to that person for a generation or more and have no entitlement to their spouse’s pension because of the 2016 Amendment.

The author professes to have almost no knowledge of municipal law.  However, municipalities are the creature of state government, and as such, it would seem that the state could enact minimum standards for municipal pensions including provisions permitting assignments of pensions consistent with prevailing state law affecting state employees.  As we know, retirement benefits form a substantial portion of public employee compensation. They merit more careful protection than the whim of a city ordinance.  Because most municipalities in the Commonwealth have very few full-time pension eligible employees, local solicitors are often encouraged to give short shrift to the preparation and review of local pension documents.  Courts should not have to apply equitable principles to decide matters of such value and importance.

Beth Anne and Mark Weber were married and produced two children, one in 1984 and another in 1994.  In their 1999 divorce, they formed a Property Settlement Agreement containing provisions that they would share equally the costs of “an appropriate undergraduate college or other post-secondary education for the children.”

In 2007, Beth Anne filed to enforce the Agreement stating that Mark had not paid his share of their son’s tuition at Florida State University.  The son also intervened claiming status as a beneficiary of the contract.  For whatever reason, Beth Anne entered a nonsuit to her “special relief petition.”  Although granted standing the son did not prosecute his claim.  Then, anyway.

In 2016, the son filed his own special relief petition seeking payment of half of the $166,000.00 cost of his undergraduate education, which had concluded in 2011.  Father filed an answer asserting a four-year statute of limitations under 42 Pa.C.S. 5528(a)(8).  Although not in his petition itself, he also asserted that he was also entitled to recover half of the cost of his graduate education to secure a pharmacy degree.  The half cost of this endeavor was $98,000.00.  At argument on Mark’s defense, the court allowed son to amend his petition to include the graduate degree costs.

Following argument, the trial court in Crawford County denied the third party claim stating that the son’s claim was derivative of Beth Anne’s rights and he lacked standing in the wake of his mother’s election to withdraw her claims.  Son appealed and the trial court ruling was reversed in a published Opinion in 2017.

On remand, Father moved for summary judgment based upon the statute of limitations.  Although not clear from the Opinion, it appears that Beth Anne joined in her son’s claims at least on brief.  Nonetheless, the Trial Court held the statute of limitations applied to the undergraduate degree claims and that the Agreement language did not support the notion that “post-secondary education” included studies undertaken after college.  Son again appealed.

The Superior Court relied upon a 1992 case, delCastillo v. delCastillo, 617 A.2d 26 (Pa.Super. 1992) to hold that an agreement to pay for education “beyond the high school level,” did not encompass graduate studies.  The Opinion in this case by Judge Mary Murray noted that under contract law, the trial court interprets the contract where there is ambiguity.  What made the facts of this case more complex was an inconsistency in son’s factual statements.  In his early pleadings, he said he “finished” undergraduate studies and then began a graduate pharmacy program.  The facts at trial established that he was never awarded an undergraduate degree, but he was admitted to a pharmacy program in Florida nonetheless.  The degree of doctor of pharmacy can be awarded to an undergraduate.  The Trial Court found and the Superior Court affirmed the concept that a graduate degree was not within the contemplation of the Agreement formed.

On the statute of limitations issue related to the Florida State undergraduate studies, the Superior Court quotes language from a 2006 case, Crispo v. Crispo, 909 A.2d 308 (Pa. Super. 2006), which implies that contracts to pay debt in property agreements are “continuing” obligations for which the statute of limitations is inapplicable . Id. at 315.  It then contrasted Crispo  with a more recent case, K.A.R. v. T.G.L. 107 A.3d 770,775 (Pa. Super. 2014) where the court held that failure to enforce a onetime payment due under an agreement was subject to the limitations statute.  Crispo appears to have been distinguished because the time for the payment of the debt was not fixed.  In the instant case, the Superior Court approved of the Trial Court’s holding that once son ceased his undergraduate studies in 2011, the otherwise continuing obligation was fixed such that the statute of limitations would apply.

We wrote about K.A.R. in a blog published on January 26, 2015.  In that discussion we noted that, reconciling fixed from continuing obligations could be a tricky thing, but suggested that litigants should not be permitted to keep claims in the closet indefinitely.  The facts in Weber are indeed tricky.  We know that son stopped attending undergraduate school at Florida State in 2011.  We also know that when he filed for what he first called his graduate degree in 2016 he said he had been in graduate school since 2011.  This Opinion draws a line between the undergraduate and graduate educations, although it appears to also acknowledge that a person can complete an undergraduate degree and be awarded a doctor of pharmacy for those endeavors.  See Opinion at p. 11.  Query whether son could claim a continuing obligation had he taken eight years and $362,000.00 to finish a pharmacy degree of whatever Latin appellation, whether bachelor or doctor of pharmacy?

For the practitioner, this is an area where careful drafting counts.  The National Student Clearinghouse Center reported that only 58% of the students who started four-year College in 2012 had earned a degree six years later.  Agreements need to regulate if not capitate these investments of after tax income.

Weber v. Weber v. Weber, 2019 Pa. Super. 133 (4/26/2019)

As part of National Public Radio’s morning edition report for April 29, 2019, business correspondent Yuki Noguchi reported on a phenomenon we have witnessed, financial infidelity.  Ours is an age where credit is available everywhere 24/7.  Want to buy a power washer at 3 a.m.? Your friends at Amazon are not only prepared to take the order, they are also happy to discount the product if you will take a Chase Amazon Prime card as part of the transaction. If you watch CNN, an advertisement runs where a sales team realizes that it doesn’t have the financial resources to fill a new customer’s massive order for their product.  Instantly, an online banker appears and suggests the needed cash can be available in hours.

According to I Corinthians, we are tempted in the same way that everyone else is tempted.  But, God can be trusted not to let us be tempted too much, and he will show us how to escape from temptation.  According to the New York Federal Reserve, the temptation appears to be winning as consumer debt grew from 3.25 trillion in 2012 to almost 4.25 trillion in 2017.

What Noguchi was reporting upon was the fact that if you are married, your debt may be increasing without your knowing it.  A recent study indicates that within families 25-40% of adults are not being candid with their spouse about the debt they carry.  What made the story all the more poignant was that it told the story of a family where this occurred.  The husband had incurred some debt to make a career change to become a financial counselor.  When he opened his new practice, it did not instantly generate the revenue he expected and consumer credit became a convenient crutch.  As one might expect, a person who counsels people about money management would be embarrassed to reveal to his spouse that he was struggling with his own credit issues.  Ultimately, he confessed and it appears the couple worked things out, although the wife acknowledged that she was angry about the entire situation.

So suppose you were the “victim” in this situation.  Your spouse the “motor head” tells you that a classic car is going to auction.  He is certain that if he can buy it for $20,000, he can restore it and sell it for twice that amount.  While looking at the three other cars in the driveway you tell him he is crazy and that this investment and related debt service is nowhere in the family budget.  But, despite your protests, he independently borrows the money or taps your home equity line of credit to buy the car.  He gets his best friend to provide the garage space so you don’t even see the car.

Time goes on and for whatever reason the marriage starts to unravel.  Someone files for divorce and when husband provides his disclosures, you see $20,000 of consumer debt you did not know about is now $28,000 because he never made more than the minimum payment and there is $6,000 due to Chase/Amazon on his separate card for the crap he bought trying to fix the car.  His friendly neighbor is also saying that he wants $700 for the 10 months the car was “hidden/stored” in his garage while your husband was “restoring” it.  The restoration never was completed, so you have a half pulled apart car you did not know about and $35,000 worth of related debt.

The law is going to protect you here, right?  Well, maybe but maybe not.  Marital debt is any debt incurred by either spouse during the marriage to the date of separation.  It doesn’t say “known debt or disclosed debt”.  A judge or hearing officer may be sympathetic, especially if it is money spent on a boyfriend or girlfriend.  Courts have the discretion to award assets and liabilities in different percentages including “The car debt is all his; the PANDORA Jewelry debt is all hers.”  But the law is not firm on this subject.  Even less persuasive is the situation Noguchi reported where unknown debt was used to maintain the family lifestyle.  In that instance, wife will argue that she would not have taken the Disney vacation or had the house re-carpeted had she known that debt and not husband’s business was not the source of the money underwriting these projects.  Many courts take a laissez faire approach. “You both went to Disney and you both walked on the rugs so you both will share the experience of paying for that debt.”

The moral is “Know thy spouse.”  If you have doubts, perhaps you should demand an agreement that says neither of you will ask the other to contribute to debt that is not known and acknowledged in writing. You don’t want to be staring at $35,000 in car debt in a divorce proceeding only to listen to your spouse say, “She knew I wanted to get that car and fix it.” The truth is that you did know what he wanted; you just did not know that he did it.  A good beginning is to agree every year during tax season to secure your free credit report and share it with your spouse. Reluctance to make that exchange is a sure sign that financial trouble is either underway or about to occur. A failed marriage is a sad but recoverable event. A failed marriage coupled with undisclosed and unmanaged debt burden is not.

To answer a question with a question: “Isn’t the sensible answer ‘No’?” After all, people contemplating divorce are not children. This is an entirely adult decision made by an adult who decided to marry in the first place. The prospective client is the person living the marriage with all of its advantages and disadvantages. No matter how close the friend or family member, that person is not living the marriage.

In the past, my feelings on this subject were mixed and colored by the breadth of friends and family brought to these meetings.  In many instances, the guest is more adamant that there needs to be a divorce than the spouse doing the interview.  This can be especially true of parents who will often confess during an interview that he or she never liked the marriage or the other spouse in the first place.

Rule #1 is consider carefully who to bring and what motivates you to invite that person.  Recently, I had an initial interview with a prospect and a parent where it was clear within the first 20 minutes that while the prospective client had an enormous array of objective reasons to pursue divorce, however, her expressions and language made equally clear that she was not prepared to begin this journey.  Truth is clients who do not really believe they are entitled or could be better off by ending a marriage are very poor clients to represent.  They don’t believe in the mission even though they can articulate why they are in pursuit of it.  If you want to bring a guest, bring one who can help you process your real needs rather than endorse your uncertain mission.

Rule #2 relates to attorney client privilege.  What you tell a lawyer alone or in the office with a member of the lawyer’s staff is entirely confidential.  It is not to be revealed to anyone else.  But, if you bring an outsider to the meeting, the attorney client privilege is lost as it relates to confidences related with an outsider present.  Therefore, what you tell me in the presence of a guest is not confidential.  It does not mean that the attorney is at liberty to discuss what was said.  It does mean that if someone subpoenaed your friend or family member, what you told the lawyer in a meeting with an outsider can be revealed through examination of the guest.

Is this a justification for excluding others from an initial meeting?  No.  It just means that not all subjects should be on the table.  If you know of illegal, fraudulent or even embarrassing conduct on your part or that of your spouse, the meeting with an outsider is not the time to reveal it.  I typically tell clients about this by stating that, if there are such facts that need to be discussed, that should be the subject of a subsequent conversation with the lawyer alone.  Rarely does this conduct drive the transaction being considered in an initial interview. But it often colors how the case is handled.

If the discussion stopped here, it would appear an attorney interview should be conducted alone.  However, experience has taught me that some of the most productive initial interviews I have hosted have been conducted with an objective friend or family member.  These folks often see inconsistency or lack of candor in ways that the attorney does not.  They know their subject based upon observation of their friend and his or her marriage.  Just as important is the fact that there are now a second set of ears to hear and absorb what the lawyer is saying. Just as has been reported in relation to a patient’s ability to absorb what a physician is saying in a medical setting, people are usually nervous and somewhat distracted during an initial interview concerning separation and divorce.  Just as with a poor medical diagnosis, it is difficult to remain focused when discussing termination of a relationship built upon expectations it would last a lifetime.

In the end, it can be very helpful to bring someone with you when you are judging whether to terminate a marriage and whether the person doing the interview is “right” for you.  But as we have noted, think carefully beforehand, about who you bring and what you say.

We have written a fair amount about prenuptial agreements including a lengthy piece last October concerning difficult issues that young couples can face but rarely ever discuss.  Some recent litigation we have been managing prompts mention of a subject, which probably should be in a premarital agreement in almost every marriage.  In fact, we should probably all have these agreements.

The subject?  Debt.  Americans love it.  The average household owes $184,000 on the mortgage and $28,000 on the cars in the driveway.  The new and growing issue is student loans.  They exceeded $1.25 trillion in 2018.  The average household with these loans owes almost $48,000.  Then there is the “dirty” debt of credit cards.  It’s a relatively small $420 billion but about $7,000 per household.  What makes it dirty are the interest rates and fees associated with this debt.  The average rate on this debt appears to be just over 16%.

So what does this have to do with premarital agreements?  If you marry and buy a house, chances are good you know it.  Same with the family cars.  If your spouse is taking on consumer debt, the danger is more difficult to see.  Perhaps it is for a hobby, season tickets for hockey, or clothing.  You may see that stuff coming into the house, but you don’t necessarily know how it is paid for.  It is not common, but there are couples out there that owe $50,000 or more in revolving (i.e. credit card) debt.  In many cases, half the couple has no idea.

As an equitable distribution state, when divorce occurs, we divide the assets and the liabilities.  What about the liabilities your spouse incurred during the marriage but didn’t disclose to you while they were accruing.  Divorce is painful enough without learning at the end that your loved one racked up $30,000 in debt, which you never heard about until the divorce was filed.  And, then you are being asked to “share the pain?”  You thought that the trip last year to London to watch the Eagles take on the Jags was paid by his parents.  Wrong.

Don’t let the shame be on you.  You should have an agreement that says, “We are each individually responsible for debt incurred during the marriage without contribution from the other spouse unless: (a) the debt was joint; or, (b) there is a signed document saying we are treating it as joint.”  We all have bad habits, but because they are our bad habits, we should take responsibility for them and do so without asking for a contribution to underwrite our bad habits.

Bear in mind as well that if you establish a home equity line of credit, most lenders do not insist that the borrow be “joint” or for a lofty purpose.  Meanwhile the note and associated mortgage say whatever is drawn is a joint obligation without regard to how the borrowed money was employed.

Collectively, and without help from our much indebted federal, state and local governments, Americans personally owe $13.5 trillion.  That’s $135,700* per household.  Marital debt is any debt incurred during the marriage.  If you are going to be allocated some or all of that debt, shouldn’t you have a right to know about it before it is incurred?  Get that in writing.

*The reader may note this value is less than the mortgage debt referenced above.  That’s because some Americans actually don’t own houses or have actually paid them off.

The Center for Investigative Reporting at National Public Radio (NPR) published a report on March 9, 2019 about the longstanding controversy over parental alienation.  The broadcast includes recordings of actual testimony from a New Jersey child custody proceeding where a father suggested that the mother’s relationship with the children was “toxic.”  Parental alienation is a concept not formally embraced by the mental health community, which suggests that one parent can poison a child’s relationship with the other parent.  If you are enmeshed in a grave child custody dispute where you think the other parent is actively interfering, you know the pain it causes.

The actions of the New Jersey trial judge seem radical, even dangerous.  However, the psychologist who first identified parental alienation as a disorder, Richard Gardner, suggested that the only effective means to undo the damage of alienation was to place the child in the custody of the parent from whom the child was alienated.

As you listen to the actual conversations, the Judge’s conduct seems capricious.  But, you need to listen further, including a later conversation with a judge from Florida who describes just how frustrating it is to manage cases where a child says he or she wants no relationship with a parent.  These are not parents who have abused a child or otherwise engaged in criminal conduct.  One also senses that the parents in the reported case were not emotionally “out there.”  To this day, a decade after the custody case was concluded, the children report they are still scarred by the experience of losing contact with the parent they were most connected with.  The case also recalls the conversation between Alec Baldwin and his daughter Ireland where Baldwin asserts that Ireland’s mother, Kim Bassinger is destroying his relationship with his child.

The NPR report notes correctly that alienation is not accepted as a condition in the Diagnostic and Statistical Manual of Mental Disorders (DSM), the Bible of Mental Illness.  The report also notes that Richard Gardner had some very peculiar views about not just parental alienation, but other issues related to child abuse.  It is also suggested that parental alienation is a device used by fathers falsely to remove children from mothers and that the psychological community is complicit in these claims because there is a lot of money to be made in effecting “reunification” with a parent from whom the child is alienated.

One also hears from children, now adults, who claim that efforts to remedy “alienation” effectively destroyed their childhood by forcing them to live with a parent whom they disliked and depriving them of time they wanted to spend with a parent who they craved.  The children are articulate in describing their anguish.

The courts and the psychological community take the rap.  Even to this writer, the judicial interventions sound Orwellian, reminiscent of the “Kids for Cash” scandal that emerged in 2007 in Luzerne County, Pennsylvania.  Having been involved in child custody cases for almost four decades, I have seen the parental alienation problem from both sides.  Kids often tend to bond more to one parent than another and that bond can and often does change over time.  Minor children of all ages also tend to engage in “good/bad rationalization.”  It is only when we form adult relationships that we begin to see good and evil as relative.  Thus, kids tend to buy into suggestions that a parent with whom they are not closely aligned is bad or unworthy of affection.  But, now you are the judge; a 14 year old tells you that she doesn’t care if she ever sees her mother again.  The facts do not support the concept that mother is a virago.  In fact, the record often demonstrates with teenagers that the favored parent is one who tolerates whatever the child wants including absence from school, open sexual relationships with peers or patent refusal to obey rules of any kind.  These kinds of behavior often drive judges to employ extreme measures in an effort to reign in the child to conform with societal norms.  Other children will be “perfect” when in the custody of the favored parent but engage in intensely antisocial behavior when visiting the parent with whom they are at odds.

One thing is clear.  Whether parental alienation merits it owns category in the DSM is not a real concern if you are a parent dealing with an alienated child.  It also seems that Gardener’s idea of removing the child from any contact with the favored parent seems extreme if not dangerous.  Yet, granting the wish of complete removal from contact with a disfavored parent seems to signal that children rule the world.  That’s not a comforting thought either.  As an observer, it seems clear to me that parental alienation has been debated too much and studied too little.  I have watched a 10 year old tell a judge that he can see no redeeming qualities in a father.  Yet, as the judge began to probe precisely what caused this irreconcilable rift it became quite clear that the child either could not explain the sources for his animosity or employed adult conclusions such as “My dad is verbally abusive” or “He doesn’t consider my needs.”  In the end, alienation exists and rather than debate whether it belongs in a manual, we need to understand better what makes it form and fester.  It is either that or accept that alienated children will grow up in a single parent world.

The discussion merits a listen. Click here to go directly to the site.

Take a friendly lawyer to your local watering hole and ask him for a quick summary of annoying things that have occurred in the practice in the past 20 years.  Chances are two strong subjects will come up.  The first is the decision about two decades ago by the Superior Court and Commonwealth Court to issue non-precedential opinions.  In common parlance the opinions are called “non-published”, but truth is that they are published and you can read them but the court adopted a rule that they had no precedential value and could not be cited as authority, even though they were dispositive in the case decided.

Last year the Superior Court disposed of roughly 8,000 cases, but less than 400 had a precedential opinion.  Many of the other 7,600 decided some important legal matters, matters where precedent would be helpful, but the volume of decisions made the court nervous that it was issuing “precedent” where the three judges involved did not have the time or resources to consider the implications of a precedential opinion.

For the past several years the bar has been lobbying that the rule was too restrictive. Non-precedential cases should be worthy of citation and if the law was wrong or the precedent should be regarded as unique because of the facts, let the next team of lawyers fight over that when briefs and oral argument take place in their case.  In other words, the case is not binding as a matter of law but it should be influential unless the subsequent appellate litigants showed it should not be.

The fight ended with a victory of sorts for the common law.  The Supreme Court ordered that unpublished decisions decided as of May 1, 2019 may be cited in briefs and arguments but do not have the weight of stare decisis.  Decisions before May remain verboten but at least the door of precedent has been unlocked for the future.

Oh, and that second complaint that is driving the common lawyer to drink.  Client anonymity. Try standing in front of a mirror, let alone an appellate panel of judges and saying, “Your honors, K.M. versus J.M. is an unwarranted expansion of the ruling in K.K. versus K.L. and is in direct contravention of this Court’s en banc ruling in J.C. v. K.C.  If K.M. is allowed to become law, J.C. is effectively overruled.” All of this because of an ersatz fear that the children of these folks will be scarred should their names appear in published law reports.  Last year Facebook reported 2.3 billion users.  There are only 7.7 billion people on the planet.  May I suggest that judicial efforts to preserve anonymity in legal cases is but a speck in an ocean cluttered with people who can’t wait to share what they are up to and just how badly their ex-spouse or boyfriend treats the kids.

At the risk of appearing obsessed, I write a second time about the separation of Jeff and Makenzie Bezos. This time my subject is again borrowed from the Wall Street Journal, but it’s not about the money. Rather, the Journal produced a prominent and adulatory article about the divorce announcement by the couple (actually Jeff) on Twitter. I thought it interesting because anyone who separates from a spouse or long time relationship is left asking; how do I let people know?

In olden days, this was done either by phone or in person. It creates an awkward moment because if you are the person getting the news, you are not certain just how to react. After the “I’m sorry to hear that….” the question becomes how far does the inquiry go? It seems cold to stop with the vague “I hope it works out.” Yet, is the person making the announcement asking for absolution? Therapy?  There is no happy answer.

So, I think there is merit to a public announcement and despite my general abhorrence of Twitter, I see benefit in getting the word out. I don’t know whether it requires a “joint” announcement as the Bezos posting suggested. For most of us, separation does not suggest that we need to “calm the market” in Amazon stock. However, the many lawyers and therapists who commented upon the Bezos announcement liked the idea of controlling the message and communicating that the problems either have been or will be handled with civility.

If you read what was posted by Mr. Bezos, it was a bit treacly.  In part, it says:

“After a period of loving exploration and trial separation, we have decided to divorce and continue our shared lives as friends.”

Perhaps this was all so amicable, but the news was immediately accompanied by reports that Herr Bezos already has a girlfriend.  It also throws shade on the ambiguous phrase “loving exploration.”  But, back to the main point… People want to know if you are separating.  If they truly care about you, they would like to know things will be civil even if that is merely an aspiration. It is also a good way to signal to your spouse how you want him or her to respond. The beauty of the electronic approach is that it gets the word out and allows friends to control a responsive dialogue on their own terms.

I don’t do Twitter because I have witnessed a thousand prominent people see their public persona crash and burn. They did not think before they wrote. Twitter is best known as a place where people say stupid things.  But perhaps Twitter might actually become an instrument of civility rather than a semantic battleground.

What to say? Well it may be ideal to issue a joint announcement. It is rare for couples to be finished with each other at the same time.  Usually, one spouse is the catalyst. If that is your situation, keep it simple and avoid what will be perceived as over the top sentimentality.

“I wanted to let friends and family know that (Jeff ) and I are separating.  I am hopeful that this process will preserve our dignity and not draw you into a conflict where you will feel the need or desire to take a side.  I hope our friends will remain just that although we may no longer be a couple.”

Message sent.  Now, when you run into the neighbor in the frozen food aisle, they “know” and can ask either how it’s going or confine the conversation to whether chicken Florentine is good with arugula.  The recipients also know that you want to be an adult during the process.

So am I on the road to conversion as a Twitter acolyte? Perhaps. But then there is the recurring fear that if I joined the social media band no one would “follow.”

While writing about high profile divorces is a means of attracting readers, it really leaves most of us feeling “empty” when it comes to how it relates to our ordinary lives. But the announcement this week of the divorce agreement between Jeff and MacKenzie Bezos made the front page of the Wall Street Journal. There is a reason for this. Unlike the split of say P. Diddy and Cassandra Ventura announced in October, the Bezos divorce actually could affect our lives if we own anything besides a token piece of Amazon. Can that be? NBC announced the story Wednesday morning just as markets opened. Stock price then $1,656. It closed the day at $1659. But when markets opened this morning (1/10), they did so at $1,640. We don’t know what causes these variations but the Bezos divorce was front page of today’s major news outlets.

Why would anyone care? Mr. Diddy is estimated to be worth almost a billion dollars. What composes that billion is unknown to us. But Jeff Bezos is worth $150 billion and the far biggest piece of that is 16% of all Amazon stock, about 79,000,000 shares. If $150 billion is an accurate estimate and $130 billion of it is in AMZN stock, a lot of that stock is in play in the divorce process.

This was a long-term marriage (25 years) in an equitable distribution state. The latter phrase means that Mackenzie does not automatically get 50% as she would in a community property state. But, this transaction was most likely not: “you take the house(s) and the cars, I’ll keep my stock.” Lots of ink has been spilled in the Jack Welch and Frank McCourt divorces about what a non-entrepreneur spouse should get. But even if Ms. Bezos took only 30-40% of the marital estate and kept the house and 401(K), she is still going to walk away with a piece of Amazon that would rival those held by Vanguard and Blackrock. Vanguard and Blackrock represent hundreds of thousands of investors. Mackenzie Bezos is a party of one. As one of the tiny pieces of Vanguard, I bought knowing that Bezos was the lead dog and that lead dogs understand the responsibilities of owning 16% of the entire kennel. But all I know about Ms. Bezos is that she is a novelist who married her husband when Amazon was still a book distributor and that today she may have the power to put stock to the market in some ways that could create dangerous volatility for those of us with smaller stakes. If there is a consolation for the small investor, it is that the Bezos’ appear to live in Medina Washington where community property presumptions of 50/50 don’t apply. Then again, the Bezos do have homes in a couple of community property states so their real residence state may be not what we think. A community property state could signal a $75 billion dollar settlement and a larger piece of Amazon.

So what has this to do with mere mortals? The answer is liquidity. We commonly see business entrepreneurs or their spouses in a world where 70-90% of their wealth is enmeshed in a closely held business. They are divorced as commonly as anyone else is but they typically ignore the liquidity crisis which divorce can trigger. Folks like Bezos have some relief from this particular headache. Their stock is public and can be sold. But ask any senior executive in a publicly traded company how much freedom public securities offer them and they will respond: damn little. There are blackout periods when they cannot trade and every time they do, the investor community is combing the SEC records to see who sold and wonder why stock was sold unless the sky was ready to fall.

You don’t have to be a Bezos to have this problem. Every day we insure houses and their contents based upon an unlikely casualty contingency. In so doing we anticipate and hedge against a remote possibility. We do the same with both life and disability insurance policies. But few of us ever look at our own portfolio of assets and ask; what if my spouse announced “Game over.”  It is not a pleasant thing to think about. But chances of a house fire are pegged at about 1:3000. The number of divorces in the United States exceed the number of house fires by 2:1.

Most people reading this will dismiss it. “I’m not getting divorced.” Those deniers seem to think that they are the only spouse who could be unhappy in their marriage. So why diversity and attempt to arrange the balance sheet so that illiquid assets are a smaller piece of the portfolio. There is actually a second reason. It is reflected in the Greek tragedy called “Theranos” where a $10 billion dollar valuation in 2015 turned into criminal indictments of management three years later. Enron was $92 a share in 2000 and half that price a year later. GE lost half its market capitalization between June 2017 and the same time this year. It has declined another third since then. So there are many reasons to accept the bromide that there can be too much of a good thing. Even if you are a Bezos and even if you have 200 shares in your retirement plan.

Holidays are supposed to be a time of merriment and conviviality.  Experience has taught us that they are also a time of immense stress.  This is especially true where families are no longer intact.  Families bring with them a sense of “expectation” and holidays are full of rituals, whether it be the Thanksgiving family football game in the backyard or the Feast of the Seven Fishes at Christmas.  Your families expect you to be there and to be there in the company of your kids.

Sometimes scheduling doesn’t work so well, either by accident or design.  The annual Feast of the Seven Fishes is Christmas Eve and most divorced families alternate that evening so the children may miss it every other year.  So, there is your family on Christmas Eve asking you about the whereabouts of your kids for the important family event while your ex is at their house with the kids doing nothing except eating pizza and watching Toy Story for the hundredth time.

In olden days, which is to say before cell phones and electronic mail, you might have given thought to calling the ex and telling them just how selfish and stupid it was that the children were missing a special family event with grandparents and cousins.  But, chances are you didn’t make that call because that was going to be unpleasant at best.  Today, however, you have a new stealth missile in your communications arsenal. You can send a blazing email or text expressing every dark thought your mind can conjure, hit send and instantly turn the device off knowing that the missile will hit its target.

Don’t.  It is a temporary feel good moment for you but one which creates a permanent record of your anger and leaves collateral damage that affects the kids watching Toy Story and the co-parent from whom you will need a favor sooner or later.  Indeed, you are probably right that Fishes with Family should trump Toy Story, but all you are really doing is making your kids feel bad at a time of the year when the real goal is to spend time feeling good.