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Phoenix Divorce Law Blog

Oil baron's divorce among the costliest in history

Back in August, we wrote about the impending divorce case of self-made oil baron Harold Hamm. At that time, commentators were saying that the Oklahoma fracking tycoon's divorce could be one of the most expensive split-ups in history. This was being said because, according to Hamm's wife, his business has increased its wealth by $17 billion since the couple was married 25 years ago. Depending on the way Oklahoma property division was to be applied in the case, a lot was potentially at stake.

In Oklahoma, money which is earned by the efforts of one party can be subject to division, while property gained because of economic circumstances outside that individual's control is deemed separate. With Hamm's reputation as a self-made man, it was a hard sell to argue that he accidentally came into his wealth.

How do judges make spousal support determinations in AZ? P.2

In our last post, we began speaking about how judges in Arizona go about making determinations of spousal support. Again, the first thing judges need to determine is whether there is any entitlement to spousal support, and then how much the entitled party should receive over how much time.

As we noted in an October post, there are several types of alimony courts in Arizona may award depending on the circumstances. These include compensatory and rehabilitative alimony, temporary maintenance, and permanent alimony. The type of alimony awarded depends on the circumstances of the case and the reasons for the entitlement.

How do judges make spousal support determinations in AZ?

Spousal maintenance, also called alimony or spousal support, can be an important resource for a disadvantaged spouse after divorce. It can also be a significant burden to the paying spouse. When considering the issue of spousal support in Arizona, judges have broad discretion to award or not.

Generally, judges will first consider whether one spouse is entitled to spousal support. Arizona law spells out several reasons a court might find such entitlement. If one party does not have property to meet their reasonable needs, that can be a reason for support. Another reason might be that one spouse is not financially self-sufficient through employment or that, because of the need to care for a young or disabled child, a spouse is unable to seek employment or cannot find work that would bring in sufficient money.

Dealing with the family home in divorce

In divorce, it is not always an easy task to separate from a spouse in every way. This is particularly the case when there are children involved and both parents want to continue to be involved in their lives. It can also be the case when one or the other party wants to keep the family home but is unable to have the other spouse removed from the mortgage.

Typically, the party who is keeping the home after divorce will seek to have the mortgage loan refinanced in order to remove his or her ex from the loan. This is not always possible, though, particularly for large mortgages. Part of the problem with refinancing lies in the inability of many divorced individuals to demonstrate an acceptable debt-to-income ratio. Weak credit history can also be a barrier to refinancing for some divorcees.

Work with an experienced attorney in garnishment proceedings

Child support and spousal support can be challenging financial responsibilities to deal with for those who have gone through a divorce. In some cases, financial strain can lead to the inability to meet one's financial responsibilities to a former spouse and one's children, which can then result in a court issuing an order for garnishment of earnings.

Garnishment is the legal process under which a party is able to collect payments from another party who owes them money under a court judgment. This includes payments for spousal support and child support. In order to pursue garnishment in Arizona, the money one seeks to obtain must be located in Arizona rather than another state. Those who want to pursue payments from an out-of-state party need to do so under the laws of the state in which that individual is located.

Default property division rules can be trumped by effective premarital agreements

In recent posts, we've been speaking quite a bit about prenuptial agreements, particularly about their usefulness in divorce, provided they are wisely negotiated and properly executed. To understand the usefulness of prenuptial agreements in divorce, it is helpful to have a basic understanding of the default rules for property division in the state of Arizona, since these are the rules that apply in the absence of an agreement to the contrary.

Generally speaking, there are two approaches states take to property division. One is called equitable distribution, which involves a fair division of property and debts deemed to be marital. The other approach-which Arizona uses-is community property, an approach which generally involves equal distribution of marital assets and debts. That being said, Arizona is a bit different than other community property states in that courts are supposed to divide marital assets equitably.

What can a prenuptial agreement not deal with?

In a previous post on this blog, we wrote a post dealing with the topic of when prenuptial agreements can be set aside in the state of Arizona. As we mentioned there are two primary situations where this can happen: when a party to the agreement did not voluntarily sign the agreement; and when a party to the agreement didn't have sufficient knowledge about the other party's assets and liabilities. A prenup can also be set aside when it is not executed validly, which is more of a technicality.

Another important issue to be aware of with prenuptial agreements is that parties may not contract with respect to certain issues. Under Arizona law, the major one listed is the right of a child to support. This means that couples may not agree in advance that child support will be reduced or denied to the custodial party should the couple obtain a divorce down the road. The reason for this is obvious: child support is for the good of children and parents may not negatively harm the child's right to support.

Even the rich sometimes need child support modifications

Child support is a real burden for many divorced parents in the United States. This is particularly the case among low-income families. Unfortunately, failure to pay child support can lead to serious consequences of the delinquent parent. Fortunately, some noncustodial parents are able to obtain relief through a modification of the child support order when circumstances have changed enough to warrant a modification.

Even the richest among us can feel burdened by child support payments. Halle Berry, for instance, recently filed a motion to reduce her monthly support payments. Under the current support order, Berry reportedly owes $16,000 per month to Gabriel Aubry for the care of their six-year-old daughter Nahla. The couple reportedly has joint custody.

Prenuptial agreements useful even for those of modest wealth

When many people think of prenuptial agreements, they assume they are only useful to those who are wealthy and stand to lose a lot in divorce. While it is certainly true that prenuptial agreements are in greater use among the wealthy, such agreements can certainly benefit those of more modest wealth.

There are a variety of circumstances, other than being very wealthy, in which it may be wise for couples to consider a prenuptial agreement. One common situation is when one or both parties are professionals who own businesses, such as a law practice or a medical clinic. Because divorce can leave ownership interests in a business exposed, it is critical to prepare for the possibility before marriage.

When can a premarital agreement be set aside in Arizona?

Prenuptial agreements are an important tool couples can use to protect themselves from financial loss in the event of divorce. As we've mentioned previously on this blog, though, it is important to take care when negotiating and drafting these agreements to ensure everything is done correctly. A careless prenuptial agreement won't do a couple any good and will only result in unnecessary costs and court appearances.

Under Arizona law, there are two general conditions under which a prenuptial agreement will not be enforced by a court. One of these is when a court determines that the agreement was not executed voluntarily. An agreement executed under duress or coercion does not represent a real agreement, and courts will not recognize them.

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