by homeatvilla » Tue Dec 27, 2011 03:10 am
Hi, I was the sole beneficiary of my sons sgli. After receiving the proceeds I am now going through a divorce and my spouse is wanting half the money. Indiana is a state where everything is considered marital property. However, from what I've read SGLI is federally mandated and is not included. The attorneys are telling me I am reading this incorrectly. Can someone guide me on this? Also, per code 38 5301 - I read this as what I have spent of the money isn't his either but am I reading this wrong also? Please advise.
Posted: Tue Dec 27, 2011 04:39 pm Post Subject:
As you have stated, Indiana state laws deem everything as marital property. If your son’s SGIL was still in effect, your husband would not have been able to stake a claim in the proceeds since you were the sole beneficiary. Now that you have claimed the proceeds, the terms of the SGLI contract has been fulfilled and is no longer in effect to establish you as the beneficiary. In the eyes of the law, what you have right now is a sizable amount of money which can be counted as marital property.
Attorneys are expensive and they just might be trying to drag the case in order to make some money. You are right on both counts, that of SGLI being federally mandated and in interpreting US Code: Title 38,5301. What you can do is contact the SGLI authorities and clarify the details of the case.
Posted: Wed Dec 28, 2011 11:59 am Post Subject:
Homeatvilla . . .
All is not lost, and none of it is as bleak as the attorneys are telling you.
Here's a better answer than you've received above or from any other attorney so far.
In the case of Carrington v. Carrington (No. 17A03-0703-CV-126) [available at http://www.in.gov/judiciary/opinions/pdf/09170701ewn.pdf ], on page four of the Appellate Court's "Memorandum Decision" it restated the trial court's finding:
17. The Court finds that the total inheritance received by [Wife] from her mother’s estate is a marital asset[;] however, the portion therefrom that was never co-mingled, never added to or managed by [Husband], should not be divisible by the Court and is therefore set aside to [Wife] free and clear from any claim thereto by [Husband] without comparable award to him.
A subsequent finding (#19) seemed to contradict this, resulting in the matter being kicked up to the Court of Appeals. There, the justices reasoned that such unequal division of "marital" property can be upheld, but it is up to the trial court to consider all five tests under Indiana law necessary to make such an award.
According to the Appellate opinion, although the unequal division of assets was, superficially reasonable, and that the wife had satisfactorily rebutted the presumption of an equal division of most of her inheritance, because it was not "clear" that the trial court had "reviewed" all five factors under Indiana law, the case was remanded to the trial court "to state the reasons for its disposition of Wife’s inheritance." It did not foreclose the wife's ability to keep the money as her own. It just said to Judge Carpenter, "Lookie here, Kirk, you failed to write down what was going through your mind. We can't read your mind. We just need to see more specifically how you arrived at this decision" and nothing else -- because it looks like you did the right thing.
So, unlike the words from Gilmore above
what you have right now is a sizable amount of money which can be counted as marital property.
your matter is not as black and white as all that. Yes, it can be counted, and No, it can be kept separate as well. It's up to your attorney to make the unequal division appear reasonable to the court and to make it stick.
Here are the five tests enumerated in Indiana Code 31-15-7-5 to which the Court of Appeals referred:
Presumption for equal division of marital property; rebuttal
-----Sec. 5. The court shall presume that an equal division of the marital property between the parties is just and reasonable. However, this presumption may be rebutted by a party who presents relevant evidence, including evidence concerning the following factors, that an equal division would not be just and reasonable:
--------(1) The contribution of each spouse to the acquisition of the property, regardless of whether the contribution was income producing.
--------(2) The extent to which the property was acquired by each spouse:
------------(A) before the marriage; or
------------(B) through inheritance or gift.
--------(3) The economic circumstances of each spouse at the time the disposition of the property is to become effective, including the desirability of awarding the family residence or the right to dwell in the family residence for such periods as the court considers just to the spouse having custody of any children.
--------(4) The conduct of the parties during the marriage as related to the disposition or dissipation of their property.
--------(5) The earnings or earning ability of the parties as related to:
------------(A) a final division of property; and
------------(B) a final determination of the property rights of the parties.
If you have treated the SGLI payment as your sole and separate property, not commingled it with other marital assets, not used any of it to pay for marital debts or obligations (such as food, utilities, etc), as I read the plain words of IN 31-15-7-5, you CAN be entitled to keep the SGLI proceeds as your separate property. It requires your lawyer to set out the facts and make proper inquiries at trial as to your husband's (1) contribution to the inherited money (little or none?), (3) the economic circumstances of both you and your husband at the time of the divorce, (4) your conduct and that of your husband's with respect to "dissipation" (aka: spending) of such assets during the course of your marriage (perhaps with more weight given to later in the marriage), and (5) you and your husband's earnings or earnings ability at the time of the divorce.
It appears to me that the answers to these tests are not hard to establish. If your attorney is not capable of overcoming this presumption of equal distribution, then you need to find another attorney ASAP. I don't see it as being very difficult at all. (3) and (5) should be easy -- if your husband has employment that provides an income greater than yours, or if you do not work, it should be a "no-brainer" as to who wins that debate. As to (4), if both of you managed to fritter away each other's money in fairly equal shares, then this, too, should be a moot point for the trial court to consider. If your husband did a much better job of it than you ever thought of doing, then the scale certainly should tip in your favor. If you were the profligate spender in the house, then your husband could make a case that half of the SGLI money would compensate him for your prior "excesses". Only you can answer that question.
But I would like to inquire about something else. You wrote "my son" rather than "our son". Is that indicative of anything in particular? Like, your husband is not the father of your child? That would certainly help with test (1).
Passing four out of five tests should be good enough. The law only says the court must "presume" in the absence of other evidence -- the rebuttable presumption -- the equal division of marital property. It does not state that all five tests must be met. The opinion of Court of Appeals only requires that the trial court give proper "review" and document its findings:
We remand with instructions for the trial court to issue a revised Decree in accordance with this Opinion. In particular, in its revised Decree, the trial court should make findings showing that the court has taken into account not only Wife’s inheritance but the other statutory factors listed in Indiana Code Section 31-15-7-5 and state the reasons for its disposition of Wife’s inheritance.
It should be noted that this opinion was a "Memorandum Decision -- Not for Publication" which only means it may not be cited as precedence. It can be used for the purpose of establishing a defense of res judicata (the civil equivalent of criminal double jeopardy), and for collateral estoppel (if your matter has already been tried and decided, it would prevent a retrial -- again, one of those civil "double jeopardy" matters).
If you haven't been to trial yet, it cannot be used precedentially. But it certainly gives you a clear view of how to defend your position.
And you can be sure that the Court remembers what it has said even though it is "unpublished" -- you cannot unring the bell -- and a similar case on appeal will get similar treatment. If the trial court, at the urging of your attorney, does a great job of "reviewing" the five tests and "documenting its findings", the matter will not be overturned or remanded on appeal.
You ask about 38 USC 5301. I don't think it preempts state law concerning the money after it has reached your hands. You received the SGLI money. The requirement of 38 USC 5301 was met -- no one interfered with your receipt of the money. Beyond that, however, I believe only state laws apply.
So, I think your best course of action is what I outlined above. Rebut the presumption of equal distribution by attacking all five tests. Number (2) is a given -- you inherited the money as a death benefit listing you as the sole beneficiary, and it cannot be presumed that the decedent meant something else. Three of the other four should be simple. The fourth one could go either way, but should not overwhelm the outcome -- it's just 20% of the court's "reasoning".
Let us know how things eventually turn out for you. And as the proud parent of an active duty US Marine Corps staff sergeant who served in both Iraq and Afghanistan, my profound condolences for your loss. Too many young men and women have died in these last 10 years for reasons that are not entirely clear to the American public.
Posted: Fri Dec 30, 2011 07:44 am Post Subject:
Max,
Do you write a novel every time someone asks a question? Your e-mail chains with clients must be insanely long.
Posted: Fri Dec 30, 2011 10:04 am Post Subject:
Do you write a novel every time someone asks a question?
Hey! Anything to earn 22 cents, right? But the answer to your question is NO, I don't.
However, in the case of the post above, I was just trying to give the poster the information she needs to defend her right to keep the money she's received for the death of her son. Everyone else she's talked to is telling her to give it up.
My 22 cents' worth of words above were intended to give the lady $200,000 worth of hope. What have her attorneys done for her except bill for their time?
Posted: Fri Dec 30, 2011 10:07 pm Post Subject: Great Answer Max!
I just could not resist making a comment on this post and telling Max what a wonderful answer he gave.
That is what I am talking about!
Not only did he answer her question in full, but he gave her the case law that he obtained the answer from. Good stuff!
Posted: Thu Jan 05, 2012 04:14 am Post Subject: SGLI Divorce
Thank you for your time and words of advice. I have an appointment with my lawyer tomorrow to discuss the "equal distribution ". As for your question, yes my son is actually mine and my husbands. We had two children and neither care for him. He has always been controlling and verbally abusive and finally went into physically abusive. We have been married seven years (this time, we were divorced for 13 years prior to this) I know! Anyway, he quit his job two weeks after we got married. Always stated "I paid my dues". Now he is claiming to be disabled. No he isn't disabled, I have plenty of witnesses for this. I'll let you know how it all turns out. Again, thank you so much for your time and advice. It is good to know there is such wonderful people in the world as you. Also, you are correct about these young men and women that volunteer to serve in the military. They are such special people. Many don't realize the sacrifices they make to do this. Whether in war or overseas or in the United States they sacrifice so much and deserve a lot of thanks and respect. Thank your son or daughter for me for their service. It is appreciated.
Posted: Thu Jan 05, 2012 05:08 am Post Subject:
(this time, we were divorced for 13 years prior to this)
That's the bargaining chip you need to demonstrate his [lack of] "contribution" to the effort to divide the money to establish test #1 in your favor. You put most of the effort into raising your son, and deserve the recognition that your son gave you as his beneficiary.
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