“What You Need to Know Before and After the Final Decree”

Presented By:

Texas Advanced Paralegal Seminar (TAPS)October 3 – 5, 2012

Crowne Plaza Hotel, 14315 Midway Road, Addison, TX

1What You Need to Know Before and After the Final Decree

After litigation of the case, the informal settlement agreement (ISA), the mediated settlement agreement (MSA) and/or the Judge’s ruling from the bench, it is now time to document the agreements and/or rulings into a final document called…

Final Decree of DivorceWhat You Need to Know Before and After the Final Decree 2

What you need to know BEFORE the

Final Decree…

What You Need to Know Before and After the Final Decree 3

Effects of a Final Decree of Divorce

(1)Dissolution of Marriage

The primary effect of a divorce decree is to terminate the marriage and restore the parties to the status of single persons.

In addition, a dissolution of marriage has a number of other immediate effects, including the following:

4What You Need to Know Before and After the Final Decree

Establishing that the parties were in fact married prior to the divorce, which is especially important in the case of an informal or common-law marriage.

Ending the marital community. Voiding all provisions in a spouse’s will that purport to be

in favor of the other spouse. Disqualifying the parties from the tax advantages

available to, and relieving the parties from the tax burdens placed on, married persons, generally beginning with the year of divorce.

Destroying the parties’ respective privileges to keep each other from giving adverse testimony in criminal prosecutions occurring after the divorce. Interspousal communications made during the marriage, however, remain privileged in both civil and criminal cases.

5What You Need to Know Before and After the Final Decree

Basic Items in a Final Decree of Divorce:

AppearancesPetitioner/Respondent

Record of Testimony

Jurisdiction

Children of the Marriage

6What You Need to Know Before and After the Final Decree

Grounds for Divorce (Section 6.001)InsupportabilityCrueltyAdulteryAbandonment

Living apartConfined in a mental facilityConviction of a felony

7What You Need to Know Before and After the Final Decree

• Property and DebtsHusband’s Separate PropertyWife’s Separate PropertyHusband’s Community PropertyWife’s Community PropertyHusband’s DebtsWife’s Debts

• Name Change Court CostsAttorney’s FeesOther OrdersSignatures

8What You Need to Know Before and After the Final Decree

Name Change

A lot of client’s are unsure about a name change during a divorce proceeding. You must advise your client’s that this is their one chance, their “get out of jail free card” for changing their name.

If they decide later to do a name change it will cost them!

We will re-visit this Name Change in further detail after the divorce decree.

9What You Need to Know Before and After the Final Decree

10

Health Insurance

Depending on who your client is, you may need to address the issue of health insurance.

A client with health issues that is relying solely on their spouses health insurance for coverage may need to consider asking for additional support to help cover the costs associated with COBRA.

What You Need to Know Before and After the Final Decree

11

Property Division – Although the most broad portion of the decree, this can also be the most problematic. A few words of wisdom…

Divide what you can ahead of time!Personal property items (i.e.

knifes, forks, you know, the important stuff!)

Gifts and furniture itemsCell phonesEtc…

Document ALL pick-ups!What You Need to Know Before and After the Final Decree

12

DEBT

Before your client signs the final decree of divorce, you should advise them to research each and every account that the decree references no matter if that account falls under the “Husband” or “Wife” section.

Who’s name are the accounts under?Consider refinancing jointly held debt.Liquidating assets to re-pay the debt such as

the car, house, real property, 401(k).

What You Need to Know Before and After the Final Decree

13

Deeds

Special Warranty Deed

Use legal descriptions in your decree as your decree can be used to transfer title in some instances.

Deed of Trust to Secure Assumption

Owelty Lien

What You Need to Know Before and After the Final Decree

14

QDRO’s

What is a QDRO?Qualified Domestic Relations Order

The first step in preparing a QDRO is to contact the plan administration for a sample QDRO.

Once you have drafted your QDRO, send back to the plan administrator for pre-approval to avoid future problems.

What You Need to Know Before and After the Final Decree

1515

Vehicle(s)

A POA will be needed to transfer title on a vehicle in the other spouses name or a vehicle in both spouses name.

An Assignment of Interest will be needed for the purposes of a leased vehicle.

Not getting these documents signed before the signing of the decree can cause your client unnecessary headaches in the future!

What You Need to Know Before and After the Final Decree

16

Children

Withholding Order – you want to make sure your client understands when the actual Order will take affect.

Visitation schedule – Visitation, especially summer visitation, can be very confusing for clients, make sure they understand BEFORE signing the decree.

Taxes – You may want to speak with your clients CPA before the decree is final, it could save them money!

Mediation Clauses – Beneficial for some, NOT for others.

What You Need to Know Before and After the Final Decree

1717

AFTER the Final Decree - this is when the REAL work begins for your client!

What You Need to Know Before and After the Final Decree

18

Child IssuesYour client should immediately notify

schools or day care facilities of any changes in the pickup or delivery schedule and whether there are any changes in who has authority to pick up the child.

Your client should advise the school if there are any changes of address or telephone number for either party so that each parent will receive notices, mailings, and reports.

If any of the events occur as set forth in the decree to require the notifications also listed in the decree (such as change of address or employment), your client should make the required notifications immediately.

What You Need to Know Before and After the Final Decree

19

Properties Awarded in the Decree

Your client will need to record any documents necessary to transfer title into their name. Your client will also need to contact the holder of the mortgage to make certain all escrow deposits and any other benefits (such as private mortgage insurance) accruing from their ownership of the property are also transferred into their name.

You should have secured a power of attorney on the vehicle[s] awarded to your client. Your client should take this power of attorney, the title[s] to the vehicle[s], and evidence of liability insurance to the auto registration office to have the title[s] changed to their name.

What You Need to Know Before and After the Final Decree

20

If your client was awarded a portion of a retirement plan, they will need to submit to the plan administrator the necessary qualified domestic relations order (QDRO) to transfer their portion into an account solely in their name. Once the QDRO has qualified with the plan requirements, the plan administrator will send certain documents directly to your client. Your client may wish to seek the advice of a financial planner or tax advisor to determine whether they should roll the account over into another type of plan.

What You Need to Know Before and After the Final Decree

21

Health Insurance

If your client had health insurance under their ex-spouse's group employment insurance, they have the right under federal law to convert their coverage into their name in accordance with COBRA. Your client only has thirty days, however, from the date the decree was signed to give notice to their ex-spouse's employer and insurance company that they are making that election. They must do so within the thirty-day period, or they may waive their ability to have this coverage.

What You Need to Know Before and After the Final Decree

22

Address and Name ChangesIf your client’s address has changed or if

their name was changed in the decree, they will need to contact the following to determine what they need to do to change their information on their records:Department of Public Safety Driver's License

Division;Social Security Administration;Credit card companies; Insurance - vehicle, home, life, and so forth; Internal Revenue Service;Mortgage holders;Utilities on residence;State licensing agencies;Credit Reporting Agencies.

What You Need to Know Before and After the Final Decree

23

Basic Post Divorce Estate Planning

New Will

Your client will need to have a new will prepared to make certain the people they want will receive properties owned by them in the event of their death.

Because a will may not affect certain assets (retirement plans, financial accounts, and life insurance), your client will need to contact the companies through whom they have those assets and sign whatever documents they require to change beneficiaries.What You Need to Know Before and After

the Final Decree

24

Changing Beneficiaries

Your client should review the payee of the survivor benefits under their 401(k) or other retirement plan. Sometimes the grant of a divorce will not have the effect of changing the beneficiaries.

Contact the insurance companies on any life insurance policies your client received or policies covering any asset they received (house, vehicle, and so forth) to make certain all transfer and other forms have been signed to properly effectuate the intent of the decree. What You Need to Know Before and After

the Final Decree

2525

Financial Accounts

Specifically in connection with financial accounts that were awarded to your client (bank accounts, individual retirement accounts, stocks and bonds, and so forth), they will need to contact the financial institutions holding those accounts and follow their advice to make certain their ex-spouse's name is not on the accounts and that their ex-spouse has no authority over the accounts.

What You Need to Know Before and After the Final Decree

Miscellaneous Items for clients:

Change any computer or phone passwords to ensure Internet privacy.

Contact a certified public accountant, accountant, or other person to make certain your client has everything from the divorce proceeding that they will need for preparation of their next tax return and to make certain they take whatever action may be required that will be necessary or that may benefit them in the payment of taxes.

26What You Need to Know Before and After the Final Decree

In some instances, your law firm may hold certain originals or copies of documents in connection with your client’s case. Call to set up a time for your client to pick up any documents they want to keep. Advise your client that your firm will retain their file for however long, after which it will be destroyed.

27What You Need to Know Before and After the Final Decree

Conclusion

28

Surprisingly, most law firms do not take the time or effort to consider a majority of the items we discussed today. I believe this to be an incredible disservice to the client and can cause unnecessary headache for the client who is already going through an extremely difficult time.

Presentation written by:Gary Ashmore, Attorney at Law

Amy Tarno, ParalegalThe Ashmore Law Firm

3636 Maple AvenueDallas, Texas 75219

214-559-7202www.ashmorelaw.com

What You Need to Know Before and After the Final Decree

KEEP UP WITH US ON THE WEB!FACEBOOK

facebook.com/AshmoreLawTWITTER

Twitter.com/AshmoreLawYOUTUBE

YouTube.com/AshmoreLawESTATE PLANNING BLOG FAMILY LAW BLOGPERSONAL INJURY BLOG

www.ashmorelaw.com 29

Use your smart phoneQR app to scan theQR code above.

What You Need to Know Before and After the Final Decree

“This material is a publication of The Ashmore Law Firm, P.C. and should not be construed as offering legal

advice.  This material is not a privileged communication and does not create a lawyer-client relationship.”

What You Need to Know Before and After the Final Decree 30