“Serious bidness”

A few moons ago when I was in law school, Shelton Hand taught Domestic Relations.  The class covered most of the actions (legal actions, not crazy behavior of clients) that occur in Chancery Court.  More than a few times, he would make a point about a subject and then say “This is serious bidness” with a little southern drawl.  He was absolutely correct.  The practice of law with respect to marriage, divorce, and child custody is serious bidness that should not be taken lightly.

Within that area of law, there is often no singularly more important document than the 8.05 financial statment submitted by the parties.  Chancellor Primeaux recently emphasized the importance of 8.05 statements in Tip 6 and Tip 9 of his “Top Ten Tips to Impress a Chancellor at Trial” series.

An 8.05 should be prepared by each party with assistance from their attorney and if needed, other professionals.  Full disclosure is required.  No hiding the ball.  More appropriately, I guess I should say no hiding the income or assets.  Nobody hides debt unless it is in the name of the other party.  However, when it comes time to discuss income and assets in the setting of a divorce, clients sometimes develop what I call “Chancery Amnesia.”  For so long as the case is proceeding, they can’t remember diddly about money.  Show them a check stub and ask them if it is accurate and the response will be something along the lines of “I guess” “maybe” or “I am not sure.”  They will however, testify with absolute certainty about expenses, debt and that the other spouse is the cause of the expenses and debt.

In Rogers v. Rogers handed down yesterday from the Court of Appeals, it appears Charles Rogers played fast and loose with his financial disclosures.  The Chancellor initially granted a divorce to the parties along with an equitable distribution.  Later, contempt issues were brought back before the court.  Then came a 60(b) motion for relief from the final judgment based on alleged misrepresentations on the part of Mr. Rogers with respect to disclosure of his gross income.  The problem?  His 8.05 didn’t match his income tax return and his testimony was anything but clear.

The Chancellor found fraud and modified the alimony award.  In fact, the modification increased the amount of rehabilitative alimony from $400 a month to $1000 a month.  Ouch.  A majority at the Court of Appeals noted the high burden of proving fraud by clear and convincing evidence and reversed the Chancellor’s fraud decision.

Although Charles’s Rule 8.05 statement incorrectly reflected his monthly salary, the record shows that he explained the discrepancy several times in his trial testimony. As a result, we find that the chancellor erred in considering Charles’s Rule 8.05 statement only, and not also his trial testimony, in determining that Charles’s misrepresentation of his income rose to the level of fraud. In her July 6, 2010 judgment, the chancellor erroneously found that Julianne proved by clear and convincing evidence that Charles perpetrated a fraud upon the court. Therefore, the chancellor erred in vacating the prior decree and revising the final divorce decree by increasing the alimony award.

On the other hand, Judge Barnes, joined by Judges Griffis and Fair, dissented and found it

reasonable for the chancellor to have relied on Charles’s Rule 8.05 statement, rather than try to weigh and determine which portion of his testimony was true or was not true. At no time during the original hearing did Charles indicate that the Rule 8.05 statement’s representation of “gross monthly income” was inaccurate.

Rogers, at paragraph 38.  All of this mess could have been avoided had Mr. Rogers provided an accurate 8.05 financial statement with the following supporting documents required by 8.05:

copies of the preceding year’s Federal and State Income Tax returns, in full form as filed, or copies of W-2s if the return has not yet been filed; and, a general statement of the providing party describing employment history and earnings from the inception of the marriage or from the date of divorce, whichever is applicable.

Look for this case to make a trip to the Mississippi Supreme Court before it is over with.  I hate to see a rule allowing a party to flat out lie on an 8.05 financial statement and get away with it.  Of course, it is hard to prove fraud on the Court by clear and convincing evidence where there is reference to three different gross incomes, but the Chancellor chooses to believe only one of them. What is the Chancellor to believe?


About randywallace
I am a husband, father, attorney, outdoorsman and cook.

One Response to “Serious bidness”

  1. While I am not practicing in Mississippi, I do run into some of these types of situations that you describe from time to time in my Virginia family law practice. Huge red flags waive before my eyes when my new family law client seems, strangely, recalcitrant about providing me (their lawyer!) with even the most basic of financial/personal information that I request for them to fill out on my standard Domestic Relations Questionnaire. My first concern is determining whether it is an issue of trust (because, if they don’t trust me, then how can I possibly competently represent them?) or whether they are hiding something. In most of these situations, it turns out to be the latter, for which (ironically) developing more attorney-client trust is often an effective panacea.

    Most of the time, a similar pattern of evasiveness becomes apparent with the other party as well, as I and opposing counsel scratch our heads and shrug our shoulders in a collective sort of oneness. In those situations, we (the attorneys) know that both of our clients may be skirting certain legalities, they both know it, and neither wants to tell the attorneys anything about it. In these sorts of “mutual ax hanging over the head” situations, I am absolutely fine with the concept of entering into an in lieu of litigation agreement that both parties can live with, that is not overly unfair to any one party in particular, and that resolves the issues short of court intervention. I do, after all, have a certain duty to protect my client and to zealousy represent them within the bounds of the law (which may sometimes include the instinct not to probe too far into the actual facts when both sides seem to want to evade them).

    However, even for the most sensitive, observant, and astute attorney, a few occasionally get passed you. My worst of these “Tales from the Trenches” stories comes from a case in Fairfax, VA about 5 years ago or so. At that time, one of my several “jobs” included a part-time senior associate/contract attorney position for another firm. The file ended up “on my desk” about 3 weeks before trial. NO discovery had been done and I had never even heard of the client, much less met with or spoken to him. To all of my fellow attorneys, I don’t think I even need to explain the extreme disadvantage one might be operating under having been handed a case with an unknown client three weeks before trial. Yes, I asked a lot of questions and, from the client, I was given answers (but no time to independently obtain, subpoena, and/or review documents).

    So, the trial date arrives and we appear. I put on my case with all of the information and documentation that I have been provided in that three week window. Opposing counsel seems similarly unprepared to refute any of this evidence. Then, counsel for DCSE steps up to the dais…oh, man, and do they ever have some information — such as, my client makes more than $100,000 over and above any of the evidence presented so far at trial. Being an attorney whose reputation with counsel and the court was completely unblemished up to that point, I was so devastated that I had to fight back the tears. It was all I could do to get my client through that proceeding without any contempt or perjury charges AND not having child support increased based on the “new” information that was introduced vis-a-vis the DCSE.

    As a consequence of that particular experience, I quit that particular part-time/contract gig and I make it a practice to NEVER take a case 3 weeks or so (more like 6 months) before trial…ever again.

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