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The McDermott Law Offices Blog is a place where you can find information on legal developments affecting you, your family and your business:

NY Divorce Law Amended

MPMM Law - Tuesday, September 22, 2009

New York Divorce Law Amended

Automatic Restraining Orders Against Transfer Of Assets

Immediately In Effect When Divorce Case Started

A new law has gone into effect for New York divorce cases as of September 2009.

Starting September 1, 2009 automatic orders will now immediately go into effect whenever someone is served with both a summons and a copy of the automatic orders.

These automatic orders are basically concerned with preserving the financial status quo of the parties.

The automatic orders:

(1) Restrict a party from disposing of property in any way without the consent of the court or the other party.

(2) Restrict any funds, stocks or other assets from being disposed or altered.

(3) Prevent unreasonable debts from being incurred against the parties' interests or property.

(4) Require that all health insurance policies be maintained and unaltered for the parties and their families.

(5) Requires that all life, home and auto insurance policies will be maintained and shall not be altered.

These automatic orders may reduce the need for early motions to restrict such funds and property in divorce actions.

Below is a sample of the text of the automatic orders to be served with the summons:

AUTOMATIC ORDERS

Pursuant to New York DRL Section 236(B)(2) the following automatic orders are binding upon the Plaintiff immediately upon the filing of the summons, or summons and complaint, and upon the Defendant immediately upon the service of these automatic orders with the summons. The automatic orders shall remain in full force and effect during the pendency of this action, unless terminated, modified or amended by further order of this Court upon motion of either of the parties or upon written agreement between the parties duly executed and acknowledged. The automatic orders are as follows:

(1) Neither party shall sell, transfer, encumber, conceal, assign, remove or in any way dispose of, without the consent of the other party in writing, or by order of the court, any property (including, but not limited to, real estate, personal property, cash accounts, stocks, mutual funds, bank accounts, cars and boats) individually or jointly held by the parties, except in the usual course of business, for customary and usual household expenses or for reasonable attorney's fee in connection with this action.

(2) Neither party shall transfer, encumber, assign, remove, withdraw or in any way dispose of any tax deferred funds, stocks or other assets held in any individual retirement accounts, 401k accounts, profit sharing plans, Keough accounts, or any other pension or retirement account, and the parties shall further refrain from applying for or requesting the payment of retirement benefits or annuity payments of any kind, without the consent of the other party in writing, or upon further order of this Court.

(3) Neither party shall incur unreasonable debts hereafter, including, but not limited to, further borrowing against any credit line secured by the family residence, further encumbrancing any assets, or unreasonably using credit cards or cash advances against credit cards, except in the usual course of business or for customary or usual housing expenses, or for reasonable attorney's fees in connection with this action.

(4) Neither party shall cause the other party or the children of the marriage to be removed from any existing medical, hospital and dental insurance coverage, and each party shall maintain the existing medical, hospital and dental insurance coverage in full force and effect.

(5) Neither party shall change the beneficiaries of any existing life insurance policies, and each party shall maintain the existing life insurance, automobile insurance, homeowners and renters insurance policies in full force and effect.

© Copyright September 2009 - Robert G. McDermott, Esq.

Failure To Pay Child Support Now A Crime In New York

MPMM Law - Tuesday, November 11, 2008

The New York Legislature is intent on getting far more serious with "deadbeat" parents who do not pay child support.

Effective November 1, 2008, failure to pay child support may mean criminal problems for the "deadbeat" parent.

The Legislature amended New York Penal Law § 260.05(2), effective November 1, 2008, as follows:

Pursuant to New York Penal Law § 260.05(2), commencing November 1, 2008, the following will become effective:

Being a parent, guardian or other person obligated to make child support payments by an order of child support entered by a court of competent jurisdiction for a child less than eighteen years old, he or she knowingly fails or refuses without lawful excuse to provide support for such child when he or she is able to do so, or becomes unable to do so, when, though employable, he or she voluntarily terminates his or her employment, voluntarily reduces his or her earning capacity, or fails to diligently seek employment. If a person is convicted of the non-support of a child in the second degree, he or she is charged with a Class A misdemeanor.

Also, commencing November 1, 2008, New York Penal Law § 260.06(1)(a) will be added so that if the party is guilty pursuant to New York Penal Law § 260.05 and was previously convicted within the preceding five (5) years for a crime in that same section, the party will be charged with non-support of a child in the first degree, a class E. Felony.

One quirk in the new law: This new law applies only to the failure to support children under the age of 18, when a child is entitled to be supported in New York until the age of 21 or sooner emancipated.

How Will It Be Implemented?

Will matrimonial judges now automatically refer "deadbeat" parents who do not pay child support to the criminal authorities?

Do attorneys have an ethical obligation to report this new crime if they have clear proof that the crime of non support of a child is occurring?

Will the District Attorney follow through on "deadbeats" and truly prosecute?

There are unanswered questions about the implementation of this new tough standard.

However, one message is crystal clear to those who are ordered to pay support: the stakes just went up. You failure to pay could run you into having a permanent criminal record, as well as potential jail time.

The best advice appears to be simple: Pay your child support!

Change In New York Law Cuts Off Designation Of Former Spouse As Beneficiary Of Assets On Death

MPMM Law - Thursday, July 31, 2008

Divorce or Annulment Now Revokes Any Revocable Disposition or Appointment of Property to a Former Spouse

Under former law a divorce did not revoke many revocable dispositions ( "testamentary substitutes"), such as lifetime revocable trusts (including Totten Trusts), life insurance policies, or joint tenancies (including joint bank accounts). Nor did a divorce revoke a power of attorney given to a former Spouse under provisions of the General Obligations Law.

But an important amendment to the law has changed all that. Existing Estates, Powers and Trusts Law (EPTL) 5-1.4 has been repealed and a new EPTL 5-1.4 has been enacted which provides that a divorce or annulment will now revoke any revocable disposition or appointment of property to a former Spouse, including a disposition or appointment by will, by beneficiary designation, or by revocable trust (including a bank account in trust form). It also revokes any revocable provision conferring a power of appointment on the former spouse and any revocable nomination of the former Spouse to serve in a fiduciary or representative capacity, such as nomination of the former Spouse as a personal representative, executor, trustee, guardian, agent, or attorney-in-fact.

A divorce would sever joint tenancies between former Spouses (including joint bank accounts) and transform them into tenancies in common. According to the Sponsor’s Memorandum the new statute does not change the New York case law concerning the effect of divorce on tenancies by the entirety. (See Kahn v Kahn, 43 NY2d 203 (1977); Anello v Anello, 22 AD2d 694 (1964)). Laws of 2008, Chapter 173, § 2, effective July 7, 2008.

Custody Disputes - Children's Bill Of Rights

MPMM Law - Sunday, June 24, 2007

In our practice, we repeatedly see divorcing parents take extremely destructive, hurtful and even downright stupid actions in custody/visitation disputes.

These parents, who often are hell bent on "getting even" with their spouse, sometimes do and say the most outrageous things in the name of revenge, and confuse and emotionally damage their children in the process.

Divorce is certainly hard enough on adults. For children, it can be devastating. Their worlds are turned upside down by the breakdown of their household. This upheaval can be made many times worse by the venomous animosity and destructive actions they sometimes witness by their parents.

We frequently consult with adults who vividly remember how a divorcing parent behaved during a divorce case when that adult was a child.

Some of these adults have been psychologically traumatized for a lifetime by what they saw or heard. They often tell us that they wish their parents had just "settled it" like adults, and lament how their parents acted like spoiled children themselves, while ignoring the fact that everything said and done during this difficult time had a magnified impact on them as youngsters.

In the spirit of reminding those involved in divorce disputes involving children that it is their responsibility to act like mature, responsible adults to protect the most vulnerable parties to a divorce litigation ---- their precious children -----, we reprint here a copy of the "Children's Bill of Rights", which is not a legal doctrine or enforceable set of rules, but a common sense reminder of what a parent should be doing vis-a-vis a child when custody & visitation disputes arise.

Children's Bill of Rights

We the children of the divorcing parents, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish these Bill Of Rights for all children.

The right not to be asked to "choose sides" or be put in a situation where I would have to take sides between my parents.

The right to be treated as a person and not as a pawn, possession or a negotiating chip.

The right to freely and privately communicate with both parents.

The right not to be asked questions by one parent about the other.

The right not to be a messenger.

The right to express my feelings.

The right to adequate visitation with the non-custodial parent which will best serve my needs and wishes.

The right to love and have a relationship with both parents without being made to feel guilty.

The right not to hear either parent say anything bad about the other.

The right to the same educational opportunities and economic support that I would have had if my parents did not divorce.

The right to have what is in my best interest protected at all times.

The right to maintain my status as a child and not to take on adult responsibilities for the sake of the parent's well being.

The right to request my parents seek appropriate emotional and social support when needed.

The right to expect consistent parenting at a time when little in my life seems constant or secure.

The right to expect healthy relationship modeling, despite the recent events.

The right to expect the utmost support when taking the time and steps needed to secure a healthy adjustment to the current situation.

If you are fighting with your spouse about your children, please reread this, and then do it again.

These common sense reminders are too often cast aside during the emotional turmoil involved in divorce cases.

You are the adult. Your children did not ask for a divorce from either parent. Your children will remember and be forever impacted by how you conduct yourself. Keep this in mind when you are dealing with your spouse on child related issues.

New York's Home Equity Theft Prevention Act

MPMM Law - Thursday, February 01, 2007

New York has enacted The Home Equity Theft Prevention Act effective February 1, 2007. The Act creates two new statutory provisions: Real Property Actions & Proceedings Law Secs. 265-a and 1303, and amends Section 595-a of the Banking Law.

The new law requires require written disclosure to homeowners regarding the terms of the title transfer and provide a right to cancel the deal for five days after signing the contract. It would prohibit making false statements with intent to defraud the homeowner and would establish civil and criminal penalties for violating the law.

The Act protects a homeowner who has conveyed a deed to a predator (or anyone later identified to be engaged in the practice of deed stealing or equity theft). The Act requires foreclosing lenders to issue certain notices warning about scams.

Failure on the part of foreclosing lenders to properly advise distressed homeowners could result in the nullification of the foreclosure action. Any transfer of title in material violation of the Act is voidable, and can be rescinded by the Seller within two years of recording the deed.

The practical effect of how the implementation of this law will impact real estate brokers, lenders, mortgage brokers, purchasers of distressed properties and attorneys is unclear at this point.

However, the text of the Act will require major restructuring of legal language in certain real estate contracts and foreclosure action notices. The Act also imposes a requirement that certain contracts of sale be produced in both English and Spanish if Spanish is the primary language of the equity seller. On the bi-lingual contracts, an initial question is whose responsibility is it to determine if the equity seller uses Spanish as his or her primary language? Will it be necessary to produce copies in both languages to protect everyone else involved in the transaction ---- better safe than sorry? Who is responsible to pay for the translation of the contracts into Spanish? The Act raises many questions that need to be resolved.

NYS Law Update - New Right To Decide In Advance Who Will Handle Your Funeral/Burial Arrangements

MPMM Law - Friday, September 01, 2006

Sept. 1, 2006 - A New York law recently taking effect now gives domestic partners the right to control the disposition of the remains of a decease partner when one of the partners dies (See New York's Public Health Law Sec. 4201, which is effective as of 8/2/06).

The new law places a domestic partner, just like a spouse, ahead of parents, children, or other blood relatives in terms of funeral decisions.

Under the new statute, top priority goes to the person designated in a written document signed by the deceased. A simple statutory form has been created to make such a written designation easy to accomplish.

This type of law is important not only to unmarried couples, but to all unmarried Americans. While it has always been assumed that a surviving spouse will control funeral arrangements, things can get difficult when a single person dies, and estranged relatives try to step ahead of a surviving partner in making final funeral related arrangements.

This new law gives people the right to decide, in advance, who will handle their funeral arrangements provided they execute the correct paperwork in advance.

Please call us if you would like to discuss this new law and its place in your personal financial and estate planning.

NYS Law Update - Termination Of Parental Rights Terminates Inheritance Right Of Parent

MPMM Law - Saturday, August 26, 2006

A Parent Who Loses Rights to Child Also Loses Inheritance Right in NY

On July 26, 2006 Governor Pataki signed into law (chapter 285) a new EPTL, 4-1.4.

This new law provides that a parent whose parental rights to a child were terminated under Social Services Law § 384 (b) is disqualified from sharing in intestacy in any distributive share of the child’s estate (a person who dies in intestacy has no will, and his or her relatives identified under ETPL 4-1.1 share in that deceased person's estate).

The effect of this new law is to prevent a parent who was found to have abused a child from sharing in that child’s estate. The statute continues to provide for a parent’s disqualification where the parent is found to have abandoned or failed to support the child during his or her minority.

What Do I Need To Know To Do To A Will And Plan My Estate?

MPMM Law - Thursday, March 30, 2006

This is a question we hear regularly from clients. In order to assist you in addressing this question for yourself, here are some of the important basics for you to know:

Your Last Will and Testament ("Will") is a legal document that sets forth, in detail, what is to happen to your property after you die.

Your Will controls what happens to your probate estate. All property owned solely in your own name, plus any and all other property interests that do not pass to somebody else by "operation of law" are included in your probate estate, and are distributed under the terms of your Will.

If an asset is held jointly with right of survivorship (for example, a house that is held jointly with right of survivorship, or a joint bank account) the survivor gets 100% ownership at the very moment of the other owner's death. Also, if you name a designated beneficiary of an asset (for example, a beneficiary of a life insurance or pension death benefit), that designated beneficiary will inherit the asset immediately at the owner's death.

An asset that passes by "operation of state law" is not passed through the probate estate and is therefore not controlled by the Will.

However, all assets in which the deceased person had an interest are part of the taxable estate. There is a big distinction between one's probate estate and taxable estate. Avoiding probate does not mean avoiding taxes, and specialized estate tax planning, which is beyond the scope of this basic summary, can be accomplished with the help of an experienced estate planning attorney familiar with federal estate tax law.

If you die without a Will, your assets will be distributed among the persons (usually one or more family members) as dictated by the intestacy law in your state. You may be surprised to learn that in New York, and many other states, your surviving spouse will not automatically inherit your assets through intestacy if you have children.

If you die intestate, the court will choose the person responsible for wrapping up your affairs. This person is called an Administrator, and might not be the person you would have wanted. Sadly, family bickering often develops over who should be appointed by the judge. Sometimes, a public official called the Public Administrator is appointed, and must be paid with estate funds. Here are some important components and issues to consider for a basic Will designed for a husband and wife with small children, and an estate that is less than the federal estate tax limit so that complex estate tax reduction planning is not required:

1. Naming of Executor. The Executor is the person who is appointed to wind up your affairs, including paying all final expenses, making sure court papers are filed, taxes paid, and money distributed as set forth in the Will. Usually the spouse is named, but there should be an alternate, too.

2. Payment of debts and taxes. Most wills contain a clause spelling out that debts and taxes are to be satisfied, and how these costs are to be shared among the estate beneficiaries.

3. Specific Bequests of tangible property or cash can be made. For example, "My beloved cousin John Smith is hereby given, devised and bequeathed the sum of $ 10,000.00"

4. Disposition of the remainder (or residue) of property. This consists of everything that remains after steps 1 through 3, above. Usually, people want it this way: "If I die first, everything goes to my spouse. If my spouse has already died, all to the children, in equal shares, per stirpes." (Latin for, "If a child dies before the parent, that child's children split the share.")

5. When there are minor children, a Will should always be used to name a guardian(s) of their persons and property. Alternates should also be named. This should not be done any other way. Of course, if there is a surviving parent, he/she automatically is guardian, if living in the same household. Be aware, too, that the court will probably have to approve the proposed guardian eventually, even if named in a Will (unless he/she is the surviving parent, in the same household). The purpose of the Will in this regard, though, is to guide the court, and to avoid family arguments over who is better qualified.

The person you choose as guardian is the person who will raise your children. It is generally suggested that they share your views, moral and religious beliefs so that your children are raised in a manner of which you would approve. The guardian will also control any property received by your children from sources outside your estate (or from your estate if you do not name a trustee as discussed in #6 below).

6. A trustee should be appointed for children who inherit money from your estae before they are of age.

Consider carefully, however, the appropriateness of leaving money or other property outright to young children, even if a qualified guardian is available. Guardianship is a cumbersome way to manage financial affairs. Periodic reports and accounting to the court are required, and flexibility is limited by law. More important, for many, is that guardianship ends at the age of legal adulthood (usually 18, sometimes 21).

From then on, any property left to a child is exclusively owned and controlled by him/her. Most people recognize that it is bad to die intestate, unintentionally leaving half (or more) of everything to small children. Sometimes they forget it might be no better to die with a Will, if it allows the same result, i.e., leaving property to minor children.

If significant assets are to be committed immediately at death to the direct benefit of your children (as opposed to their surviving parent), a Trust is the way to go. A trust can keep your estate from eventually falling into the hands of inexperienced and immature teenagers, if you have left your children money and die while they are young.

A properly drafted trust can put the trustee, a person you choose to control the money until the child reaches a designated age, in the position of a "gatekeeper" who makes sure your youthful and inexperienced child is not left in control of a large sum of money after reaching 18 or 21 without appropriate financial supervision. A trust can defer the outright control until some later age, often 25, 30 or later, while still allowing the trustee to spend sums he or she deems appropriate for important expenses like education, healthcare, purchase of a home, etc. The foregoing is merely a general overview of some of the principles involved in basic estate planning, and should not be construed as legal or tax advice for a specific situation.

Estate planning encompasses both property distribution planning, and estate tax reduction planning if your estate exceeds the federal estate tax exemption limit. Personal preferences, goals and psychological factors relative to estate planning should be considered before making a Will.

Preparation of a power of attorney and healthcare proxy and living will should also be considered when planning your estate. These documents allow you to appoint a competent and trusted person to handle your financial and medical affairs if you are too ill to speak for yourself. The unfortuate case of Terri Schiavo a few years ago reminds us just how important these planning tools can be. They allow you, not the courts, to decide who should speak for you. It is important to explore the facts with competent legal counsel, and specific legal and tax advice should be sought prior to making any estate plan.

Copyright Robert G. McDermott - March 2006.