North Carolina is the only southern state without a constitutional ban on same-sex marriage, at least potentially until today –  May 8 – when citizens of North Carolina will have the chance to vote on Amendment One.  Amendment One is intended to go beyond the North Carolina state law, Statute §51-1.2, that already prohibits same-sex marriages “whether created by common law, contracted, or performed outside of North Carolina.” Amendment One, if approved, would rewrite the North Carolina constitution to provide that marriage between one man and one woman is the “only domestic legal union that shall be valid or recognized in this State.”

This is an extraordinary step that significantly reduced the civil liberties of same sex couples in North Carolina.  That state is one of many states grappling with ballot measures to ban same-sex marriage. In 2008, California adopted Proposition 8 that amended California’s constitution to define marriage as that between a man and a woman. Proposition 8 was adopted to counteract a 2008 California Supreme Court decision, In re Marriage Cases, granting same-sex couples the right to marry. Proposition 8 was successfully challenged in a 2010 district court decision, Perry v. Schwarzenegger, which declared the amendment unconstitutional. Recently, the Ninth Circuit upheld Perry but the ability of same-sex couples to marry is on hold pending further appeal.

While the future of same-sex marriage in California is as yet undetermined, same-sex domestic partnerships will continue to be recognized in California, thus affording same-sex couples some of the important benefits granted to married couples. The domestic partnership laws in California stand in stark contrast to Amendment One. Indeed, what is unique (and particularly troubling) about Amendment One is that it goes beyond a ban on same-sex marriage and bans same-sex civil unions and domestic partnerships. Some legal analysts have even suggested that the language of the amendment prohibits opposite-sex civil unions and domestic partnerships leaving marriage as the only legally recognizable “union.”

In eliminating domestic partnerships and civil unions, Amendment One poses serious problems for same-sex couples seeking to protect their rights relating to inheritance, child custody, property ownership and health-care decision-making. Although Amendment One seems to allow for private contracting to set forth these rights, certain agreements relating to child custody, health-care directives, death benefits, etc may not be protected unless civil unions or domestic partnerships are legally recognized. Consequently, same-sex couples in California ought to pay attention to the outcome of the May 8 vote on Amendment One, and not only for how it will impact same-sex couples in North Carolina. Amendment One serves as an important, albeit sobering, lesson for same-sex couples everywhere: it is imperative to understand what rights exist for same-sex couples in your jurisdiction and how to protect those rights. For that reason, it is useful to contact an expert in domestic partnerships as various groups continue to attempt to diminish existing protections.

To learn more, contact one of our domestic partnership attorneys.

The Pew Economic Mobility Project has a new fact sheet out that includes a very interesting chart.  It turns out that women are no longer suffering the huge income drop following a divorce that they once did.  This is good news for obvious reasons, and speaks to the increasingly balanced socioeconomic roles between the genders.  We have also noticed this trend in our office – more and more women are coming to us as the primary breadwinners in their families.  As a result more women are seeking prenups and asking us questions about asset protection in the divorce context.

Economic Impact of Divorce on Women

I have always said that when approached gracefully, a premarital agreement can strengthen a relationship. I do believe that is true, but the simple reality is that most people have no earthly idea how to approach a prenup gracefully. From either side. Too often, one fiancé dumps the idea of a prenup in the other fiancée’s lap unexpectedly at the last minute, or god forbid has a lawyer call instead. Or alternatively, the recipient bursts in to tears at the mere mention of the idea, having no idea what the prenup actually says. Not good moves to build trust.

So how exactly does one approach a prenup gracefully? Good question. I have four tips for you.

1. First, know that you have a prenup already, whether you want one or not. The default rules of the State dictate what happens to your assets during and after any marriage. That, my friends, is a prenup. So the question here isn’t whether you want a prenup, it’s whether the prenup the State gave you supports your philosophy of marriage. If not, then you might want an agreement that better captures what you and your future spouse believe.

2. Second, approach the prenup conversation from the perspective that you want to make your coming marriage stronger by discussing difficult subjects in advance. Trust me, I’m a divorce lawyer and I know what I’m talking about here – sooner or later, disagreements about money will come up, and they’ll stay up. The more you discuss in advance, the less strain you experience later. It’s that simple. Talk about it now.

3. Third, put yourself in your fiancé’s shoes before you bring up the idea of a prenup. This one is not easy, of course, but it’s vital to do before you begin. You’ve got to imagine the needs and concerns your future partner has with regards to money. For better or worse, once you become married, you become financially responsible for your spouse. You really need to understand what that means, and what challenges your spouse is facing before you can envision a good prenup. An experienced family lawyer can help you understand the financial considerations that the other party is facing.

4. Fourth, consider alternative approaches to drafting the agreement such as mediation and collaborative drafting. More and more couples are mediating prenups these days – that means that the couples hire one lawyer to help them come up with the agreement, then hire separate lawyers to review it. The cost is bit higher, but the result is often much stronger. If that seems too expensive, then the collaborative approach might work for you – in this process, all lawyers and both parties meet together in conference to come up with the terms. This way you only need two lawyers instead of three.

5. Finally, be transparent. Involve your fiancé in each step of the process you go through to come up with the terms of the agreement. Your fiancé is your partner – treat him as such. (To be clear, I’m not suggesting you bring your fiancé to office meeting with your attorney – those meetings should remain private).

If you follow these five steps, your process should not only be palatable, but useful for your marriage as well. We handle quite a few prenups in our office, and they happen to be my favorite area of practice, so I’m happy to chat anytime on the issue. If you have questions feel free to give us a call.

There is a rumor that embattled former senator and presidential contender John Edwards is going to marry his one-time mistress, Rielle Hunter.  Edwards is accused of conspiring to violate campaign finance laws by using approximately $1 million from campaign donors to cover up his affair and the child he fathered with Rielle Hunter.  If Edwards does marry Hunter, she would not be required to testify against him at the trial if she did not want to, and some theorists believe this is the only reason he wants to marry Ms. Hunter.  This is due to the testimonial privilege between spouses.  If this matter were a divorce, however, the privilege against spouses testifying against each other would not apply.

The spousal testimonial privilege can be a very powerful bar to testimony.  The privilege has two parts.  There is a privilege not to testify against one’s spouse and a privilege not to be called as a witness against one’s spouse.  A married person has a privilege not to testify against his or her spouse in any proceeding.  Additionally, a married person whose spouse is a party to the case has a privilege not to be called as a witness by an adverse party without the prior express consent of the spouse having the privilege.

The spousal testimonial privilege does not apply in divorce cases.  Spouses are often at odds regarding the way child custody and visitation should be decided or how assets
should be divided.  Anything a spouse says can be used against them in Court when disputing these issues.  One spouse admitting to hiding assets in a Swiss bank account, for example, cannot claim a privilege against having his wife testify against him when she wants to be compensated for losing access to the money.  People are wise not to say anything around their spouses that could later open the door to an unfavorable court action.

There are multiple ways that a spouse can communicate with their other half – in person, on the phone, email, text messages, etc.  During the family law litigation process, all
of these forms of communication and more can be discovered and used as evidence at trial.  Either spouse can get on the stand and state word for word what her spouse told her through any form of communication.  The other spouse is powerless to keep her quiet.

It is incredibly important to have excellent legal counsel to manage not only the formal process of a divorce, but also the communication between the parties.  In the Bay Area, a person is wise to engage the best San Francisco divorce lawyer available to help navigate these dangerous waters.

Social media accounts like Twitter and Facebook are beginning to take their place in the pantheon of highly contested properties for divorcing couples in California. As we all know, couples dissolving their marriages divide a wide range of assets already – everything from cars and homes to stock options, businesses and artwork. The unavoidable fact is that social media accounts are property, and as the value of such property increases, so too will the litigation surrounding them.

In California, absent a prenup, any asset acquired during marriage is considered community property and must be divided evenly between divorcing spouses. Any property acquired before marriage, after the date of separation, or through gift or bequest (meaning inheritance) is considered separate property and immune from division. There are of course exceptions to these rules, but that’s a good overview.

By this definition, social media accounts created during marriage will almost certainly be characterized as community property. Accounts created prior to marriage may also be defined as community property in part, depending on whether the value increased during the marriage, and whether the personal effort of either spouse contributed to that increase (which of course it would have).

The terms of service of the various social media companies also play a role in defining whether an account is considered property and subject to division. Twitter, for example, defines the content which users create as the property of the user. Twitter sees the content as separate from the account services themselves which Twitter provides. Arguably, the right to access the account and manipulate the content is a kind of property as well.

The content within the accounts, and the right to access the accounts both increasingly have economic value, and couples understandably want to add all value to the marital asset division calculus.

The big hurdle, of course, is valuing the accounts. Valuation has always been more of an art than a science. This is even more the case when it comes to untested intellectual property assets like social media accounts. Some parties are looking to the actual business flowing from the accounts as a benchmark for determining value. Others are more inclined to take a multiple of earnings – the challenge being that earnings are just beginning to manifest for these assets.

This area of property division is new, but it’s heating up. Asset division provides many challenges to divorcing couples. Careful attention needs to be paid to properly value and divide IP, particularly this distinctly tricky type of IP. A person seeking to divide a social media account, just like any asset, is well advised to seek the counsel of an experienced California family law attorney.

Our office practices family law in San Francisco and the Bay Area. As a result, we work on the forefront of many of these issues. If you have questions, feel free to give us a call.

Jessica Simpson and Kobe Bryant have been in the news recently, both because of their respective prenups. I thought I would take a moment to reflect on the nature of celebrity marriage contracts, and what this can tell us about the marriages of mere mortals.

To recap in case you’ve missed the news, Kobe Bryant’s wife has just filed for divorce, and there’s no prenup. Kobe’s wealth is estimated to be around $150 Million. Assuming the entire fortune was earned during marriage, it’s all community property, meaning Vanessa is entitled to half of it. Moreover, because Kobe continues to earn an income, and because Vanessa will likely gain custody of the children, Bryant could end up paying spousal and child support on top of losing half his net worth. Not to mention the attorney’s fees he’s going to pay.

Jessica Simpson appears to be on the first chapter of a similar story. Her fiancé has apparently backed away from signing a prenup, citing his belief in true love. Like any celebrity, Jessica’s income streams are fairly complex. She is apparently worth approximately $20 Million, and in addition to earning fees for appearances, she continues to earn royalties from her licensing contract with the Camuto Group who bought her clothing brand in 2005. Absent a prenup, Jessica’s income from all of these sources could very well become community property during a marriage. The same, of course, would hold true for her fiancé’s income, assuming he has any.

When celebrities marry, the process is very much like a corporate merger. All of the various income streams need to be charted. The books need to be balanced. The liabilities disclosed. The expectations for future growth must be set, and an exit strategy mapped. Without this process, a split becomes a financial disaster. This is true of course for all marriages, it’s simply more evident with celebrities.

The procedures necessary to create a valid prenup are time consuming, confronting, and tedious. There’s no way around that fact. Nonetheless, celebrities with complex financial structures would be insane to attempt marriage without a prenup, just as a corporation would breach it’s duties to shareholders by merging without a contract.

More important than those obvious considerations, however, is the opportunity that a prenup presents to lay the groundwork for a strong marriage. This is the point that we miss in the gossip columns, and that most people forget when proposing a prenup to a partner.

Premarital agreements require couples to take a very serious look at their expectations for finances and relationship. These expectations say a lot about the marriage, they say a lot about love, and they say a lot about how the couple works through adversity. Celebrities need prenups – that goes without saying. What isn’t said often enough is that they could also use the process to avoid rather than to foreshadow divorce. And the same goes for the rest of us.

The issue of whether marriage rights should be granted equally to everyone is, inexplicably, an on-going debate around the country.  Complicating the conversation is the fact laws are applied differently from state to state, and that federal and state law conflict at various points.  As of the writing of this post, lesbian and gay couples who are legally married under state laws are nonetheless denied federal benefits because of the so-called “Defense of Marriage Act” (DOMA).

For this reason, it is important to understand which rights marriage traditionally confers, and how these rights differ between state law and federal law.  This knowledge can allow both gay and unmarried heterosexual couples to protect their families.

Many gay and lesbian couples attempt to use premarital agreements and estate planning methodologies to overcome some of the federal inequities.   This can be effective to an extent, but the use of wills, powers of attorney, advanced healthcare directives, and cohabitation agreements simply cannot resolve all of the problems created by DOMA.   For instance, these strategies do nothing for lesbian and gay couples who wish to keep their non-citizen spouse or partner in the U.S. and avoid deportation.  The estate planning alternatives are little comfort to a family torn apart my immigration policy.

The following is a highlight of many of the Rights and Responsibilities afforded to California married couples and California Registered Domestic Partners (RDPs)
1. Joint parental rights of children if born during the marriage or RDP
2. Joint adoption
3. Joint Insurance Plans
4. Status as “next-of-kin” for hospital visits and medical decisions
5. Bereavement or sick leave to care for partner or children
6. Right to make a decision about the disposal of loved ones remains
7. Crime victims recovery benefits
8. Standing to sue for wrongful death or for “loss of consortium”
9. Wrongful death benefits for surviving partner and children
10. Welfare and public assistance
11. Domestic violence protection orders
12. Judicial protections and immunity—testimonial privilege in court proceedings
13. Automatic inheritance in the absence of a will (or in the event that a will is invalidated)
14. Filing of joint state income tax returns
15. Testimonial privilege in state court proceedings
16. Spousal protection from property tax increase upon the death of a co-owner spouse

Here is a list of some of the most important Federal Rights & Responsibilities of Marriage, which are denied to same-sex couples because of DOMA.
1. Immigration and residency for spouses from other countries
2. Crime victims recovery benefits
3. Judicial protections and immunity in federal court
4. Joint filing of bankruptcy petitions
5. Spousal veterans benefits
6. Social Security benefits
7. Medicare benefits
8. Joint filing of federal tax returns
9. Income tax deductions, credits, rates exemption and estimates
10. Deferred Compensation for pension and IRAs
11. Estate and gift tax benefits  (there are substantial estate tax benefits to marriage)
12. Medical care for survivors and dependents of certain veterans

Our office regularly advises clients on how to protect themselves and their families, whether or not they decide to marry.  If you have any questions about your rights in the light of DOMA or other federal statues, you should contact a qualified family attorney.  We’re happy to help.

Legal fees are expensive – there is no way around that simple fact. The language in the California Family Code, however, attempts to ensure that everyone has access to legal representation during his or her divorce. An indigent party may qualify for pro-bono or reduced-fee legal services, and for a waiver of court fees. Needs-based legal assistance, however, is difficult to qualify for, leaving many people in a financial bind when affording legal services. Therefore, under appropriate circumstances, the court will order one party to pay for the fees of the other.

Under Family Code Section 2030 whether you are entitled to attorney’s fees for your divorce is based on two primary factors. First, the court looks to determine whether there is a great disparity in available financial resources between the two parties. Second, the court determines whether one party is able to afford to pay fees for both parties. If these conditions are met, the court may order an award for attorney’s fees and costs.

Under Family Code Section 270 and 271, courts may also award attorney’s fees or costs as a “sanction” against a party for bad behavior. In these cases, courts may only impose fees and costs on a party that the party can afford it. With sanctions, the party requesting attorney’s fees does not have to demonstrate financial need, and the payment will come out of the sanctioned party’s assets or his or her share of community property.

If you believe you qualify for an Attorney Fees award, you should contact a qualified San Francisco Divorce or Family Lawyer immediately.

Working with divorce every day, I am very aware of the financial struggles that couples face at the end of marriage.  None of these issues are strawberries and ice cream, but the one area that causes more heads to explode than any other is without a doubt, the area of spousal support.  Spousal support (also called alimony in some States) is the payment that the higher earning spouse typically makes to the lower earning spouse after a separation or divorce.

Rather than go through a lengthy explanation of support law in California, I thought I would dedicate this post to a brief discussion of perspective.  Higher earning spouses always want to know why the heck they have to pay.  So here’s a primer for you.

The historical concept of marriage is that two people come together to form one financial unit.  When that happens, a division of labor is generally efficient.  One person does laundry, the other dishes.  More traditionally, one takes care of children while the other takes care of money.  Or perhaps one plugs away at their small business while the other stops working to manage construction on a house.

Either way, the upshot is that typically, one spouse is advancing their career and saving money while the other is not.  This works just fine so long as the family unit remains intact. Without the rules we have in place for division of community property and payment of spousal support, non-working spouses could be left without anything to live on after divorce.

California wants to protect the non-working spouse so that the welfare system doesn’t have to feed those people.  On the other hand, public policy also detests abuse and does not want to overpay recipient spouses.  For this reason judge’s have quite a lot of discretion to limit support when appropriate.

The point is, California has rules in place that are intended to protect both parties in a marriage. Both sides typically think the rules are unfair when they’re being enforced, but the legislature hasn’t come up with anything better.

If you are concerned about the payment of spousal support in your marriage, the best way to minimize it is to have signed a valid premarital agreement (prenup).  Postmarital agreements can also be effective in this area.  Absent those documents, however,  support is virtually guaranteed when there are disparate incomes.

Many people fear that drafting a prenup means that they are admitting their marriage will end before it has even begun. The fact is (and please forgive my being a trifle morbid here) that all marriages end – if not in divorce, then in death. For this reason, the California state legislature (and every other state in the Union for that matter) has helpfully crafted a default (read “generic”) plan for you in case you die without an estate plan, or divorce without a prenup. So the question you should really be asking yourself, is not whether a prenup means your marriage will end, but whether the government’s generic plan is the right plan for you.

A prenup, like an estate plan, is nothing more than a document allowing you to take control over your property. Most people believe they are better suited to decide how their property should pass at death than the government, and the same logic often applies to divorce. Many couples also find that defining their expectations before marriage helps minimize conflict later.

If you have a prenup or are planning to have one, then you have already determined that the cookie-cutter government plan is not right for you and your family. Chances are that the government plan for how your property should be divided at death will not meet your standards either.

So with those preliminary points out of the way, let’s turn to the meat of this posting: the intersection of the two documents.

It is important for married couples and registered domestic partners to make sure that their estate plans and their premarital agreements are not in conflict. It is not uncommon for estate planning attorneys who do not have experience with family law to narrowly focus on issues such as minimizing “death taxes” at the exclusion of other previous intentions of their clients. A common mistake is for an estate planning attorney to re-title property for the sake of the estate plan, but in contravention of the premarital agreement. This can have the unfortunate effect of negating the premarital agreement entirely, and you can imagine the negative impact that might have.

Another example is that many clients on a second marriage want to ensure that their property will pass to their children from the first marriage, and not to the new spouse’s family. This is possible, but the estate plan and the prenup need to work in conjunction with one another to be effective. One document cannot do the job if the other is not in agreement.

For these reasons, it is extremely important that your attorney have an understanding of both estate planning and family law. The law around property varies greatly depending on the context and circumstances. Failure to have an attorney review your unique situation from a global perspective can have serious unintended and very expensive consequences.