The Lawletter Vol 41 No 9

Brett R. Turner, Senior Attorney,National Legal Research Group

     The South Carolina Supreme Court recently considered a case that provides a wealth of guidance on business valuation questions. Moore v. Moore, 414 S.C. 490, 779 S.E.2d 533 (2015).

     The issue was one that arises often in divorce cases—is the goodwill of a business part of the business's value for purposes of a divorce case? Adopting the majority rule nationwide, the court held that the enterprise goodwill of the business is included, but that the individual goodwill of the owner is not included. Stated differently, the value includes goodwill that is transferable to another owner, but it does not include goodwill that is not transferable and resides in the owner individually.

The practical question, which has arisen in dozens of cases nationwide, is how to distinguish between the two types of goodwill. The court recognized, as most other courts have done, that goodwill need not be entirely enterprise or entirely individual. Businesses get their customers from many sources, and it is quite possible that some of those sources are individual to the owner, while others are transferable with the enterprise. For example, a dental practice might draw half of its customers from the individual reputation of the dentists, but the other half from the convenient location of its office building.

The Lawletter Vol 41 No 4

Brett Turner, Senior Attorney, National Legal Research Group

     A perennial problem in family law practice is arbitrary judges who dislike family law cases and impose strict time limits upon trials. Appellate courts are aware of this problem, and in extreme cases they have granted relief.

     In Kilnapp v. Kilnapp, 140 So. 3d 1051 (Fla. Dist. Ct. App. 2014), the trial judge set a three-hour limit on the hearing. After only an hour had passed, the trial court abruptly ended the hearing. The wife had presented only one witness, and the husband's counsel had not even finished with direct examination of the husband. The appellate court summarily reversed. "The trial court erred when it denied the husband his basic and fundamental right to due process, specifically the right to be heard." Id. at 1054.

     The husband did not have, of course, a right to be heard at unlimited length. For example, even if the husband honestly wanted an entire week of testimony, the trial court had discretion to impose a reasonable time limit.

     But the time limit imposed in Kilnapp was unreasonable, in two different ways. First, a reasonable time limit should apply equally to both parties. In Kilnapp, the wife was able to present all of her evidence, while the husband was able to present only some of his.

The Lawletter Vol 40 No 12

Brett Turner, Senior Attorney, National Legal Research Group

     One of the hardest issues in all of family law is grandparent visitation. In Troxel v. Granville, 530 U.S. 57 (2000), the U.S. Supreme Court struck down a Washington state statute allowing the court to award grandparent visitation based only upon the best interests of the child, finding that such a broad standard violates the liberty interest of the parents in having custody of their children.

     But Troxel did not decide what the proper standard for grandparent visitation is; it decided only what that standard is not. Case law since Troxel has disagreed substantially as to what grandparents must prove in order to be awarded visitation.

     No state has written more opinions in fewer cases on this issue than Alabama. In Ex parte E.R.G., 73 So. 3d 634 (Ala.2011), a nine-judge court wrote six separate opinions on the subject. The end result was that the court struck down Alabama Code section 30-3-4.1, which allowed the court to award grandparent visitation on a pure best-interests basis.

The Lawletter Vol 40 No 8

Brett Turner, Senior Attorney, National Legal Research Group

     In In re Marriage of Iqbal & Khan, 2014 IL App (2d) 131306, 11 N.E.3d 1, the two parties, of the Islamic faith, signed a separation agreement ("PNA"). The PNA named a prominent member of the local Islamic community as Counselor. It then provided:

     Husband and Wife agree that an unreasonable divorce (without Counselor's express written approval) is a violation and contrary to the purposes and intents of this agreement, and an unreasonable divorce sought by either party will forfeit their rights to custody of the children and any rights conveyed in this agreement. If either party seeks an unreasonable divorce, they hereby agree to surrender full custody rights to the other, and agree to only reasonable visitation rights to the Children.

Id. ¶ 28, 11 N.E.3d at 10 (quoting PNA).

The Lawletter Vol 40 No 6

Brett Turner, Senior Attorney, National Legal Research Group

     All 50 states have now had child support guidelines for more than a decade. Increasing numbers of states are experimenting with spousal support guidelines, especially for temporary support while a divorce case is pending.

     When applying any set of guidelines for spousal or child support, the first step is always to compute the incomes of the parties. Such computation raises a set of tricky issues when retirement benefits are involved.

     In Milinovich v. Womack, 343 P.3d 924 (Ariz. Ct. App. 2015), the father was a retired professional baseball player. His income dropped materially when his playing years ended, and he filed a motion to reduce his child support. To compute the guideline amount of support, the court had to determine the father's income.

The Lawletter Vol 40 No 4

Brett Turner, Senior Attorney, National Legal Research Group

     A recent Utah Supreme Court decision sets forth a good example of how not to use out-of-state authority when writing an appellate brief on a question of first impression. Johnson v. Johnson, 2014 UT 21, 330 P.3d 704.

     In a divorce case, the court issued an order dividing the husband's military pension, but the wife never obtained the qualified order necessary to have the military pay a portion of the pension directly to her. Some years after the divorce, she petitioned for such an order. The husband argued that she had waited too long, and that her request was barred by laches. The trial court prospectively granted the wife's request, and the husband appealed.

     There was no Utah authority directly on point, so the husband cited two New York cases. The court was not unwilling to look outside Utah, but it criticized the manner in which the New York cases had been discussed, and ultimately dismissed the laches issue on grounds of insufficient briefing.

The Lawletter Vol 39 No 12

Brett Turner, Senior Attorney, National Legal Research Group

     No field of family law is as diverse or controversial as that of support payments made by one spouse for the support of the other after a marriage has ended in divorce. The law in this area is so divided that the states cannot even agree on the name of the payment. Some states use the traditional name, "alimony." Other states follow the lead of the Uniform Marriage and Divorce Act and call the payment "maintenance." Still other states call the payment "spousal support."

     Disagreement over the label is matched by disagreement over the purpose of the payments. Most states recognize several different types of spousal support. Traditional support is awarded after a long-term marriage so that the less wealthy spouse does not suffer a drop in living standard. Rehabilitative support is awarded when it will help the less wealthy spouse to develop a higher earning capacity. It differs subtly from time-limited support, which is awarded when the marriage was not long enough to justify a traditional support award. Reimbursement support is awarded when one spouse made contributions during the marriage to the other's earning capacity, such as by supporting a spouse through graduate or professional school. Some states even recognize transitional support to bridge the gaps between other forms of support.