YOU HAVE YOUR COURT APPROVED PROPERTY SETTLEMENT AGREEMENT: NOW WHAT?
This is a companion to my article, “So You Have Your Child Custody Agreement: Now What?” http://hunterlawfirm.net/so-you-have-your-child-custody-agreement-now-what/
I was prompted to write the first one because of a client who had a good parenting agreement but no clue how to enforce it. Six months after the court approved it, she found herself back in Court trying to enforce and change it. I wrote “….Now What?” to empower her and the rest of my clients.
Now I do the same thing for you regarding that property settlement agreement.
This spring I was startled to meet two people who simply had no idea what was in their divorce property agreements. Each had been served with a contempt petition. And each was so clearly wrong about the terms of the agreement that I had to admit to myself, as if I hadn’t seen it hundreds of time, that people believe what they want to believe.
Stubborn refusal to comply with the agreement can lead to a contempt petition and incarceration. Leaving loose ends can cost a party thousands of dollars.
This is advice to my colleagues and my clients. I hope you will “take it to heart”.
I have written elsewhere about using checklists and having systems. Our file closing checklist is part of our family law practice system. We cannot close the file until the checklist items have been checked. So, have a checklist.
Here are things to recall:
1. Litigants, do your own checklist. Use your “PSA” as your guide.
2. If bank accounts are divided, be sure your or your former spouse’s names are removed from the account.
3. The same for credit card accounts. Don’t let your credit be impaired by failing to attend to this, and if it is a loan or credit card account, mark your own calendar or task reminder until you are released from that account. e.g some banks require six timely payments before they release the second party. When in doubt, call the institution during mediation and ask.
4. If the other side agrees to refinance within a specified period, or to reapply periodically, say annually, to refinance, never fail to remind the other party or to request politely for documentation such as a loan application and bank denial letter.
5. E-mail or texting may work, but be sure to save the sent communication.
6. Consider my “trick” of sending your reminder by a. Regular mail; and, b. By certified mail; and c. Attaching a “certificate of service” that certifies you sent the described documents to a specific address on a specific address. Use both regular and certified. That is essential! This works with the person who refuses to pick up the certified envelope.
7. The same for your side. Do not forget to apply for that refinance or to insist the bank tell you how many timely payments you must make in order for the other side to be released. You can reasonably be requested to provide the full loan application and denial letter!
8. Then follow up! You gave your word, and the Court ordered you to keep your word, so just do it!
9. Remember to transfer titles to vehicles. If the bank is holding the title, be sure that lender has a copy of the order/agreement.
10. Remember to exchange keys; and get receipts for them. For your home and storage buildings, know when you should replace the locks.
11. Do NOT put off dividing “the stuff”; get friends with a truck, and divide it!
12. And, remember that a divorce order requiring a division of retirement benefits does NOT divide them. Such divisions are governed by the Federal E.R.I.S.A. law. Therefore, 401K plans, IRAs, and pensions are likely to require a “qualified domestic relations order”, a QDRO (ph: “quad row”).
a. Most companies have forms or form language online for QDROs. But do not try to do this yourselves. Many family courts require them to be prepared by a lawyer.
b. Some pension plans, including the military who won’t divide a retirement if it is less than ten years, require you to make a “survivorship election” that you may have already done. If so, that’s binding.
c. Such an election decreases the overall monthly benefit by approximately 10% as it lasts for the longer of two lives. Be sure this is clear in your PSA and then make sure the “Plan Administrator” approves what you have agreed to.
d. If you did not get the other side to agree to it in writing in the PSA, don’t expect a “gift” when the QDRO is drafted.
e. Do not hire a lawyer who puts in her/his contract that they will not be responsible for the QDRO. If it’s too complicated for them, it will be too complicated for you, and getting another lawyer to do it for you may cost you twice as much and take twice as long. And, what conscientious lawyer will leave this huge “loose end” for you to deal with.?
f. You need the retirement “plan administrator” to pre-approve the QDRO.
g. The other party needs to approve the QDRO.
h. Then your Family Court needs to sign, or “enter”, the QDRO.
i. Then your lawyer needs to send a certified copy of the QDRO to the plan administrator.
j. The plan administrator then needs to approve the QDRO so that it become “certified”.
k. That’s a lot of work but it MUST be done. And, the lawyer who leaves you to do it knows exactly what she is doing! Think about it.
13. Then there is ALIMONY. Is it modifiable, or fixed? If modifiable, be alert to substantial and material changes such as an employment layoff, a big pay raise, a lottery win, or remarriage.
14. If fixed, but you just can’t pay, all may not be lost. Call your lawyer, or, even better, call me!
15. Do not forget that award of attorney fees. If you are going to refrain from filing a contempt petition, work out a monthly payment plan, and make the other side adhere to it.
16. If you get the house, you will need a deed! But, depending whether you are the grantor or grantee, you must make sure that the release from the mortgage and delivery of the deed are coordinated. Perhaps the deed will have to be held by an “escrow agreement”. Do not wait until you’ve paid the mortgage to track down your former spouse. By then, they may live in Tibet or not live at all. You need a closing, a date, place, closing agent, and closing checklist!
So, do not think you can walk out of that Courtroom for the last time and forget the parenting plan or the property settlement agreement.
Like your garden, they each need tending!
This post was written by Burton Hunter