DOMESTIC PARTNERSHIPS IN ARIZONA

I have recently been asked, by a number of people, whether Arizona recognizes Domestic Partnerships, and how it compares to marital rights.   Domestic partnerships are recognized in Arizona, but only for limited purposes, such as where a patient in a hospital is unable to make or communicate healthcare treatment decisions.  Arizona Revised Statutes §36-3231 provides that, in cases where the patient is unmarried, a domestic partner may be allowed to act as a surrogate.  Certain cities in Arizona recognize domestic partnerships and have registries where partners can file a declaration of domestic partnership or a civil union, but their rights are generally restricted to visiting the other partner in a hospital or health care facility.  Some insurance companies provide options for domestic partners, and others don’t.  You would have to contact your insurance company to determine what, if any, benefits are provided.
It is important to note that there is no law in Arizona giving domestic partners the same or similar rights as a couple who is married.  By law, married couples in Arizona have inheritance rights; the right to be covered on health insurance policies; the right to make healthcare decisions for a spouse under certain circumstances; and, in the event of a divorce, the right to a fair division of community property, the right to receive spousal maintenance (if they qualify under the statute), and parental rights.  For domestic partners, however, none of those things are automatic, and some of them (such as a community propertydivision, and receiving spousal maintenance) are precluded under Arizona law.

Now that both heterosexual and same-sex couples have the right to marry in Arizona and all other states, domestic partnerships and civil unions are not as favored, and the development of laws around these forms of partnership has slowed.  A marriage provides far more legal protection than a domestic partnership, a civil union, or cohabitation.

If you have questions about domestic partnership law and your legal rights, I suggest that you make an appointment for a consultation with a Family Law attorney.

Gary Frank & Jacinda Chen

 

Gary J. Frank is an attorney and mediator with over thirty years of Family Law experience in dealing in divorcecustody, and parenting issues. For many years he acted as a Judge Pro Tempore in the Maricopa County Superior Court, which gave him an insight into the inner workings of the courts that many attorneys lack.  In addition to representing Family Law clients in litigation, we are also willing to help people by working with them on a Limited-Scope or Consultation-Only basis.  Our office is located in the Biltmore area of central Phoenix, with satellite offices in Scottsdale and Paradise Valley, Arizona.  We can be reached by telephone (602-383-3610); or by email at [email protected]  You can also reach us through our website at www.garyfranklaw.com.  If you are in need of a consultation regarding any area of Family Law, contact us today.  We’d be happy to help.

SAME-SEX FAMILY LAW — WE CAN PROTECT YOUR INTERESTS

Our attorney, Gary Frank, has long been a staunch supporter of civil rights, including marital rights for the LGBT community.  Now that same-sex marriage is finally a reality, it is important for gay and lesbian couples to understand their new rights, and how to protect themselves in the unfortunate event that a divorce or separation occurs.

We can help you preserve your property before a marriage takes place by preparing a Prenuptial Agreement.  And we can protect you throughout the divorceprocess by making sure you receive a fair division of property; and that spousal maintenance is awarded if a party is entitled to it under Arizona law.  If you have children, we will work hard to ensure that you come away with a legal decision-makingand parenting-time plan that is in their best interests and yours, and that child support is included. 

If divorce is inevitable, it is always a good idea to explore peaceful alternatives as a first option, before jumping headlong into an adversarial and often expensive litigation.  Mediation and collaborative divorce are two such options.  Mr. Frank is a compassionate mediator with many years of experience working with families, including LGBT couples. 

When acting as a divorce attorney, Mr. Frank encourages his clients to engage in mediation.  He will help you choose a top-notch mediator and he’ll guide you through the process, giving you the best odds of a favorable outcome.  But while mediation is often successful it does not always result in a settlement, and sometimes divorcing parties have no choice but to turn to the courts to resolve their issues.  In that scenario, Mr. Frank is a strong and experienced Family Law litigator who will fight to protect your interests.   


If you are in need of representation, or even if you’d just like a consultation to learn about your legal rights, please do not hesitate to contact us. You can reach the Law Firm of Gary J. Frank P.C. by telephone at 602-383-3610, or by email at [email protected].  We’d be happy to help you.

DIVIDING PROPERTY IN A DIVORCE – HOW THE ARIZONA FAMILY COURT DOES IT

One of the first and most vital steps in a divorce is figuring out the division of property.  Naturally, people want to know how Arizona courts will divide their property.  Below are some of the most commonly asked questions that I hear from clients:
How does Arizona divide property in a divorce?
All states are either community property states or equitable division states.  Arizona is one of nine community property states.  Community Property is based on the theory that a married couple is a team, and the role that each spouse plays benefits the team.  One may be the breadwinner, the other might care for the children; or they may both work and share the childcare responsibilities – but it’s a team effort.  Therefore, the law provides that income earned by either party, and anything purchased or accumulated with that income during the marriage, is considered to be community property, belonging to both parties 50/50.  If the parties later divorce, then the community property will be divided substantially equally.
How does the court determine what is Community Property versus Separate Property?
In a divorce, the court must determine what constitutes “Separate Property,”  and what constitutes “Community Property.”
Arizona Revised Statutes § 25-211 defines Community Property as all property acquired during marriage except for property acquired by gift, devise, or descent (inheritance).  This means that salary, bonuses, and commissions earned by each spouse through employment are community property.  Employment income placed in a bank account (regardless of the name on the account) is generally considered to be community property.  Stocks, bonds, and brokerage accounts accumulated during the marriage are community property. Houses and cars purchased with marital funds constitute community property (unless the other spouse signs a deed disclaiming his or her community property interest).  Furniture and personal items purchased with community monies will be considered community property, unless there is evidence that it was a gift. And monies contributed to pensions, 401k,’s IRA’s, and other retirement accounts during the marriage are considered to be community property.

Arizona Revised Statutes, § 25-213 defines Separate Property as anything acquired by a spouse before the date of marriage or after service of petition for divorce (if the divorce actually goes through).  Gifts and/or money received by way of inheritance during the marriage are also separate property.  All of the rents, profits, earnings, dividends, and interest on separate property remain separate property.

In other words, your old baseball card collection is separate property.   The Barbie dolls your mother saved from when you were a kid – separate property.  That family heirloom your Aunt Gladys gave you last Christmas – separate property.  The money your grandfather left you when he died – separate property.  The 60” TV and surround sound system you bought with that inheritance – separate property.  The stock you purchased with grandpa’s money (which went up 10% last year) – also separate property.  If you owned a house prior to your marriage, then rented it out after you got married — the rental income is your separate property.  If you later sold that house and used the money to buy another house in your own name – well, that new house is your separate property, too (even if you and your new spouse are living in it).

BUT WARNING:  If you’re not careful, what starts out as separate property can be magically changed into community property during the marriage – as will be explained below.

The “marital community” terminates when a spouse files and serves a Petition for Dissolution of Marriage, or an Annulment.  Thereafter, income earned by either party (which was considered to be community property) is now the separate property of the person who earns it.

What does the statute mean when it says the court divides community property “equitably”?
Equitable division does not always mean an equal division.  What it really means is a “fair” division.  The court is not required to divide community property exactly equally; but it cannot, without reason, create a gross disparity or make its award arbitrarily.  In the absence of sound reasons which justify contrary results, apportionment of the community estate upon dissolution of marriage must be “substantially equal.”
In making an equitable division, the court may consider the length of marriage as part of any unequal division. The court can also divide property unequally if it determines that one of the spouses wasted community assets (for example, if one of the spouses gambled away thousands of dollars, or spent community funds on drugs, etc.)
What happens if separate property is commingled with community property?
When community property is mixed with separate property, the potential issue of “commingling” arises.  Commingling happens when, for instance, a spouse puts the funds from her grandmother’s inheritance into a joint account that belongs to both spouses; or when a spouse’s salary from work (community property) is deposited into the checking account that he set up prior to the marriage in his own name (separate property).
Mixing separate and community funds makes for a confusing situation, and it can lead to the loss of your separate monies.  Funds that are mixed can retain their character as separate property, but only if you can still figure out what funds come from where.  You must be able to trace the separate assets.  However, when separate and community monies are mixed there is a legal presumption that the new “pot” of commingled funds is entirely community property.  The burden is upon the one claiming that the proceeds are separate property to prove, by clear and satisfactory evidence,” that the separate property portion can be traced. And this is no easy task.
Can property lose its character as separate property and become “transmuted” into community property?
Absolutely!  Here’s an example:  If you are depositing your separate funds into a community property account and, over time, you are writing checks, making deposits and withdrawals, etc. — eventually the separate and community monies will become mixed to such an extent that you can’t trace it or figure out what belongs to who.  At that point, it has undergone “transmutation.”  Your separate money has lost its character separate property.  It is now community property and will be divided essentially equally in a divorce.
Can a person unintentionally make a “gift” of separate property to the marital community?
Yes.  A common scenario is where a party contributes separate funds to pay a down-payment on a marital home that is taken in joint tenancy.  Years later, one of the parties files for divorce and, when the house is sold, the party who contributed the separate funds for the down-payment wants his/her money back, claiming that it was intended as a loan, and not a gift.
The necessary elements to find that a gift was made include: (1) donative intent, meaning that you intended to make a gift, (2) delivery, meaning that the gift was actually delivered to the other person’s possession, and (3) a vesting of irrevocable title upon such delivery, meaning that you delivered the gift with no intention of retaining any sort of interest in the piece of property any longer.
Under Arizona law, there is a presumption that contribution of separate assets to community property equals a gift.  The presumption can be rebutted through clear and convincing evidence showing that there was no intent to make the alleged gift.  But this is a steep hill to climb.  In the scenario above, rebutting the presumption of a gift will be extremely difficult without a written memo or other persuasive evidence of intent.
How can I protect my separate property?
Here are some ways that you can protect your separate property:
·      (1)  Keep your pre-marital monies in a separate bank account in your own name;
·      (2)  Avoid commingling;
·      (3)  If you are buying a house together and you are contributing your separate monies to the down payment, be sure to draft a written memo confirming your intention that the use of separate funds to pay the down payment (or any other payment) is a loan from the marital community and is to be paid back upon sale of the property – and make sure your spouse signs the memo;
·      (4)  Place your separate property in a living revocable trust;
·      (5)  Obtain “innocent spouse” status (the IRS provides this status to spouses to relieve them of the responsibility for paying taxes that the other spouse owes);

·      (6)  If you receive an inheritance, place the money in a bank account in your name alone, and do not mix it with community funds (for instance, make sure not to deposit your employment income into that account).

If you have substantial separate-property assets and/or if you do not want your employment income to be considered community property, then you would be well-advised to have an attorney prepare a valid Prenuptial Agreement (or a Postnuptial agreement, if you are already married).  The agreement will need to conform to the law and be signed by both spouses.

 

Our Family Law Firm is here to help you work through even the most difficult and complicated property division matters. Gary J. Frank is an Arizona attorney and former Judge Pro Tem with over thirty years of experience in dealing with custody and parenting time issues in Family Court.  Hanna Juncaj is a highly skilled litigator, a compassionate counselor, and a strong advocate for every one of her Family Law clients. To schedule a personal consultation with our attorneys, you may contact us by telephone at 602-383-3610, or by email through our web site at www.garyfranklaw.com.

The issues in this blog are provided general informational purposes only and should not be relied on as legal advice in your particular case, nor should it be construed as forming an attorney-client relationship.  Every Family Court case is unique.  If you have a matter that appears similar to any of the scenarios that you read in this blog, you should be aware that: (1) even a slight difference in a factual situation can lead to a vastly different result; and (2) the laws are constantly changing and new laws are continually being enacted.  Legal advice cannot be given without a full consideration of all relevant information relating to your individual situation.  Therefore, if you have an important legal issue, you should obtain a consultation with a qualified attorney.  


ASK THE LAWYER – Helpful Hints on Divorce & Custody Issues from a Phoenix Family Law Attorney

My purpose in writing this blog is to give you, the reader, some useful information on topics related to Family Law.   Contemplating divorce, or running into problems involving custody or parenting time after the marriage has been dissolved, can be stressful and even frightening.  It is often hard to know where to turn for information – and without good, solid information, it is hard to make an intelligent decision.  Hopefully, this blog will provide some of the important information you need and point you in the right direction.

On my web site, I have a section entitled “Ask the Lawyer.”  In that section, you will find questions that clients and others have asked me concerning a wide range of Family Law problems, along with my answers.  The topics include everything from custody and parenting time, to relocation, child support, spousal maintenance, property division, and many other issues that arise when a marriage comes apart.  Some of those issues may apply to your own situation. 

If you are interested in looking at my answers to Family Law questions, check out our website at https://www.garyfranklaw.com/ and click the “Ask the Lawyer” link.

Spousal Maintence vs. Property Equalization Payment – Which is Best?

When negotiating a settlement agreement in which a monthly payment is to be made following a divorce, parties are sometimes faced with a decision:  Should we designate the payment as spousal maintenance — or should it be considered a property equalization payment?  There are pros and cons to both options. 



The purpose of Spousal Maintenance is to provide financial support for a former spouse who qualifies under A.R.S. §25-319.  Under Arizona law, spousal maintenance payments are taxable to the spouse who receives the payment and deductable to the payor.  Since the person on the receiving end will have to pay income tax on the payment, she or he will wind up with something less than the full amount.  On the other hand, there is a measure of security since it is very difficult to avoid one’s obligation to pay spousal maintenance – especially if it is designated as “non-modifiable.”  Under 11 U.S.C. 523(a)(5) the Bankruptcy Court has no power to discharge a debt for payment of spousal support.  Knowing that the spousal maintenance award cannot be discharged in bankruptcy provides a level of safety that may be important.


A “property equalization payment” is intended to equalize the final division of property between parties to a divorce.  It can be paid in a lump sum or by installment payments.  Unlike spousal maintenance, a property equalization payment does not result in a taxable obligation.  Thus, the receiving party “pockets” the entire amount.  However, if the person obligated to pay a property equalization payment files for bankruptcy, the entire unpaid balance could be discharged under 11 U.S.C. 523(a)(15), and the party on the receiving end could wind up with nothing.


In our struggling-economy, I’ve handled a growing number of cases in which a former spouse threatens to cut off his or her spousal support obligation by filing for bankruptcy.  Current bankruptcy law makes that an idle threat.  However, if the payment is determined not to be spousal support but, rather, a property equalization payment, then there is a danger that the debt could be discharged in bankruptcy.

The decision whether to structure a payment as spousal maintenance or an equalization payment should be made only after a careful and thorough examination of all relevant factors.  Once that decision is made, the provision must be worded precisely in order to assure that there will be no confusion about the parties’ intent.  Gary J. Frank has over 25 years of experience in handling complex divorce and property division matters.  If you have questions or concerns about your own situation, please do not hesitate to call for a consultation.  Our phone number is 602-383-3610.  For more information, contact us be email or check out our web site at www.garyfranklaw.com.