Spousal Maintenance | Interview with Bob Howard | Network Arizona

Bob Howard Interview 3

Bob Howard Interview 3 – 12-14-15

Carol : Welcome back. My guest has been on the air with me several times before. I have with me Bob Howard. He is with the office, the Stewart Law Office.
Bob : Stewart Law Group that is.
Carol : I’m going to say this, first of all there’s a lot of things that have changed. You’ve been coming on here for a long time now. Since then not only has he changed his name a couple times it’s the Stewart Law Group. He also has 6 offices throughout the Valley.
Bob : That’s right, we’re all over the place.
Carol : Now, I want to also get out some information about you all. First of all, it’s a great time to come on because so many people right now they’re fighting. They’re fighting, they might hold it in a little bit, but they’re fighting.
Bob : The holidays are tough.
Carol : They’re tough, tough times. Let’s talk a little bit about you and want you do.
Bob : Well, I do family law, which includes everything from divorce, to legal separations, to modifications of decree. I also do prenups, if people are thinking about getting married but want to get their financial affairs in order first we do that.
Carol : Right, now they have 6 offices throughout the Valley. They do consultations for everyone. I’m going to say this, I know a lot of people right now you’re thinking, thinking, thinking it’s really a good idea if you call them and get this initial consultation out of the way. You may not necessarily go through it right today. We know that.
Bob : That’s absolutely true. Actually we do a lot of consultations in December.
Carol : Right.
Bob : Lot of people are planning on making a big change come January 1. You’d be surprised January is actually … If divorce were seasonal, January would be the season.
Carol : Right, and there’s a reason for that. They want the gift.
Bob : Well, they get through the holidays and nobody wants to cause extra stress during the holidays by filing in December. Once the holidays are over and a lot of times people makes those New Year’s resolutions and so forth. This is the year, surprising by January’s a big month. Lot of filings in January.
Carol : Write this number down it’s 602-548-4600. Their website is Arizonalawgroup.com and we always give away to everyone who calls in the book The Arizona Divorce Handbook it’s your step-by-stop guide to navigating an Arizona divorce. Scott David Stewart wrote it. I think everybody should have it because it’s fantastic. Easy to read and it helps everybody whether or not your thinking about going through a divorce, going through a divorce, or even if you’ve been divorced.
Bob : Been through a divorce there’s a lot of good information in there, exactly.
Carol : I don’t care what you think. If you think that you’re through the divorce, you’re not.
Bob : It’s not over till it’s over. Who said that, Yogi Bear I think. Yeah, as long as there are children under the age of 18. As long as there are spousal maintenance obligations it’s not quite over.
Carol : Right.
Bob : Until you’ve retired it’s not quite over because of a pension goes into payout. There’s a lot of loose ends after the divorce is over.
Carol : There’s always a reason, there’s a reason first of all to get the book. Everybody should have it. Our number here is 602-277-5369, toll free it’s 1-866-536-1100. Check them out Arizonalawgroup.com. We want to give everyone this book and to have you start making your calls now. Get those consultations underway so that after the first of the year you’re all set to go.
Bob : Exactly.
Carol : Okay, spousal maintenance. What are we going to talk about today?
Bob : That’s what we’re going to talk about today, spousal maintenance. Now, last time I think we talked about litigating child custody, and parenting time, and decision making authority as they call it these days. The second biggest reason why cases go to trial is spousal maintenance. Spousal maintenance is an obligation by one spouse to pay the other spouse some money so they can continue to be supported for some period of time.
Carol : Well, how about the people that were supposed to get it that don’t get it too? There’s a lot of people and that’s why they need to hire you.
Bob : Well exactly. We have obtained spousal maintenance on occasion and we’ve defended against spousal maintenance claims. I’ve been on both sides of that story and been successful on both sides sometime obviously successful as others, but certainly reduce the obligation less than what the other side wanted.
Carol : Who gets the spousal maintenance?
Bob : It depends. It depends on the spouse that is entitled to the maintenance. Now usually that’s going to be the lesser earning spouse. You never see a situation where the higher earning spouse gets spousal maintenance from the lesser earning spouse. Just because there’s a lesser earning spouse doesn’t mean they’re going to be entitled to spousal maintenance. Our statute works, it has 2 different sections. The first section is just to determine whether or not you’re entitled. There are 4 grounds for entitlement.
The first one is whether you lack sufficient property, including the property you get from the divorce to provide for your reasonable needs.
Carol : Reasonable.
Bob : Reasonable needs. This is where that standard of living sort of things comes into. You hear people, I want to be supported in the same manner I was supported during the marriage. For some people reasonable means $50,000 a year, for some people reasonable might be $200,000 a year. It’s sort of kind of depends.
Carol : I like the $200,000 Bob myself. Go ahead.
Bob : I got to tell you though even though that’s what the statute says. The reason it’s litigated so often is that that statute leaves a lot of discretion to our judges. We have 40 or 50 divorce judges in Maricopa County. They serve usually for 2 or 3 years and then they rotate off and go do something else. Guess what, there’s a little bit of inconsistency between 1 judge and the next. It’s kind of like rolling the dice.
Our statute does not give a precise formula it just gives a lot of factors the court can consider. As to this particular section sort of the feeling I’m getting right now from the judges is that if you have a decent job, decent making $35,000-$40-50,000 a year most of the judges are going to conclude that you can support yourself pretty reasonably on that kind of money.
You may not get spousal maintenance just because you had a really great lifestyle when you were married to this other party that made a lot more money than that. It’s in the statute you can make the agreement and that’s where you need a good attorney to be able to fashion that argument. It’s going to be an uphill battle a lot of time.
The second basis is whether you can be … If somebody’s unable to be self-sufficient through appropriate employment or is the custodian of a child whose age or condition is such that the custodian should not be required to seek employment. Sometimes you have long duration marriages where 1 spouse has never worked so they don’t have any job skill at all. They can’t do anything other than maybe make minimum wage. That might not self-sufficient or they’ve got a minor child or maybe a child with some sort of disability and they have to be the caretakers for that child. Clearly you’re going to get spousal maintenance in that kind of instance. That’s what that part of the statute is for.
There’s another part, the statute says, if you contributed to the educational opportunities of the other spouse. What do we get? We get the wife who has slaved away while the husband went to med school for 8 years. Then 1 year out of med school and or into his practice he falls in love with some nurse and dumps the wife.
Carol : Happens all the time.
Bob : It happens all the time unfortunately. That’s what this section of the statute is. If you’re in that situation where you’ve supported somebody through school. You’re still going to get to share in some of the fruits of that labor by getting a spousal maintenance award.
The other section of the statute talks about having a marriage of long duration and is of an age that would preclude the possibility of gaining employment adequate to be self-sufficient. We get that self-sufficient theme running throughout the statute here.
You have to fall under 1 of those 4 categories or you don’t even get beyond to the consideration of how much and for how long. If you can fall in 1 of those categories you’re going get an award of spousal maintenance.
Carol : It certainly depends on your situation and you have to find this out through a consultation. That’s why I say write this number down it’s a great time now just to give them a call. Talk to them. They do consultations with everyone. Their number is 602-548-4600. Check them out at Arizona, I’ll spell that Arizonalawgroup.com they have 6 offices throughout the Valley. We’re giving everyone their book, which is written by Scott David Stewart. It’s the Arizona Divorce Handbook. Really quickly what do you want to say before we go to break?
Bob : I’m going to tell you some more stories.
Carol : I can’t wait.
Bob : I will tell you about a couple of results I’ve had in the courts which are all over the map. Some of them are quite interesting. I once had a case where the wife was actually a licensed attorney. She hadn’t practiced in 10 years. The husband was an attorney. The judge granted her spousal maintenance lifetime award, $8,000 a month until the husband retired. Then it went down I think $3,000 a month. It was a pretty good result.
Carol : I’ll tell you something, we’re going to go to a break. When we come back we want to hear some more of those war stories. Everybody has them. You can also call in if you want to. You can call in, you can ask your question. You can tell your war story. You’re going to get the book our number here is 602-277-5369. It’s the Arizona Divorce Handbook. Give us a call.
Our lines are open here. We’re talking war stories with divorce. We always like that. I always get excited about listening to the war stories. Now our number here is 602-277-5369, toll free it’s 1-866-536-1100.
I love when Bob comes on because it’s all educational. That’s really what it’s all about. You love teaching them. Our lines are open here everyone is getting the Arizona Divorce Handbook. It’s your step-by-step guide to navigating an Arizona divorce. Our number here is 602-277-5369, toll free it’s 1-866-536-1100. They do consultations. 6 offices throughout the Valley, Arizonalawgroup.com. Oh, my gosh tell us about some of those.
Bob : Yeah, let me fill in a little of the blanks on that last story. How does somebody who’s got a law degree end up getting spousal maintenance. Well, usually in these cases you bring in a vocational expert who testifies as to the earning capacity of the individual client. In this case I didn’t do that. My client had 3 diagnosed mental disorders. She had ADD/ADHD, whatever you want to call it.
Carol : She was an attorney?
Bob : She had … Well, she had got her law degree before these things really developed.
Carol : Shows you anyone can. Go ahead.
Bob : I proved her case by bring in her psychologist to testify about her psychological disorders. Then quite honestly, I put her on the stand.
Carol : Oh, that’s all you needed to do.
Bob : That’s all, 15 minutes into it the judge said, “Mr. Howard, if you we keep going we’ll be here all day.” I knew I had proved my case at that point.
Carol : That’s awesome.
Bob : You see all kinds of different requests and requirements. I had a case one time, I was representing the husband in this case. The wife was making a claim for substantial spousal maintenance. Husband made over 350K a year. She had not been working but she was qualified as a paralegal and could have done some work there.
Well, the facts of the case were that she was going to be able to walk out this marriage with a house that was free and clear out in Fountain Hills I think. A substantial pension plan and over 6 figures in the bank. She wanted spousal maintenance for well it was an 18 year marriage. She was looking for about $8-9,000 a month for 9 years. Judge gave her $2500 for 2 years and another $1500 for 1 year. My client was happy with that result. That was fair under the circumstances. This just shows you how the results vary widely. The court will consider all kinds of factors.
Let’s talk about some of those factors. Let’s assume they made the decision okay spousal maintenance applies we’re going to award some, what factors do they look at. Well, they look at the duration of the marriage. If you were only married for a year or 2 don’t be expecting any long term spousal maintenance. The longer you’re married the longer the spousal maintenance will be.
Carol : Hang in there.
Bob : They look at the age of the parties. They look at their prior education. They’re earnings history during the marriage. The standard of living that they had during the marriage. They will look whether somebody contributed to the other party’s employment. For instances sometimes people get transferred in these big companies and the other spouse has to quit their job and start over when they move. They’ll look at that kind of consideration.
The consider what the cost is going to be for the health insurance for the spouse that’s no longer going to be covered under the working spouses insurance plan. They’ll even look at how much money each party can put aside for the kids to go to college. They can also look at normal or excessive expenditures during the marriage. They don’t consider fault, but if somebody has really been, done something fraudulent during the marriage or something like that to dissipate the community assets they can consider that. As you can see the judge can consider anything and everything in making his decision which is why these cases get tried so often.
Carol : We mentioned of course many times people think that the woman is going to get the spousal maintenance. It’s not always the case.
Bob : It’s not always the case. There are more and more a lot of, for lack of a better term, house husbands. The husbands that stay home and take care of the kids and handle that because the wife has a better earning capacity. We’re seeing more and more those situations.
Carol : How about when they want to. There’s also some cases, not all the time, but there are some cases where the mother didn’t want them really and they end up with the father for whatever reason.
Bob : For whatever reason.
Carol : It might be for that it could be whatever.
Bob : Whatever it might be. Men can get spousal maintenance there’s no question about that. Now is there still a little bit of a gender bias in our society? Well, yeah I think there is. It does become a little bit harder to get spousal maintenance when it’s the man. The statute is gender blind. The judges should be gender blind. You can still make the claim it doesn’t make a difference.
Carol : This is important, okay. Because we kind of answered how long to go and this and that. I wanted to know if you can modify it? How do you modify it?
Bob : Well, you can. Now there’s 2 types of spousal maintenance. There’s 1 rule that applies no matter what. If either of the spouses dies or if the receiving spouse get remarried spousal maintenance stops. That is written in stone, doesn’t matter whether it’s modifiable or non-modifiable. It comes in 2 categories, if the judge orders spousal maintenance after a trial it will always be modifiable. Meaning you can come in and argue for an increase, or a decrease, or a lengthening of the time, or a shortening of the time based on significant change in circumstances.
On the other hand if the parties reach a statement they do have an option. They can create what is called a non-modifiable spousal maintenance. That means nobody can change the amount or the duration. It will still stop if one of them dies or if the party receiving spousal maintenance gets married. Otherwise it will go for the full duration of whatever they agreed to.
Carol : Well what about this … Go ahead.
Bob : I was going to say and I’ll tell you again, a lot of times I see the men want non-modifiable spousal maintenance because they’re worried about the wife coming back and asking for more. Let’s say they get spousal maintenance for 6 years, at 5 years and 11 months here comes the petition to modify, gee we need another 3 or 4 years. Yeah, that’s a possibility but my general experience, that I’ve found, is there aren’t a lot of increases in spousal maintenance. Whatever the judge orders at the time of the trial is probably going to be the most the other spouse is going to get. There might be a decrease if for instance one of the spouses becomes disabled gets hit by a truck can’t earn money any more. That’s a substantial change in circumstances. You might see a decrease in spousal maintenance.
When 1 spouse 3 years after the marriage becomes wildly successful and makes a lot more money they generally don’t let the previous spouse share in that. I don’t know if the men should really be all that concerned about having non-modifiable. I can give you an example where it went back to bite the guy.
We had a case I had represented the wife. The husband insisted on non-modifiable spousal maintenance. My clients said that was okay. She was good with that. 6 months after the divorce sure enough he lost his job. Ended up selling something out of Kiosk at the mall. Obviously, a pretty lower paying job. He was stuck still paying the same amount of spousal maintenance as before because he wanted non-modifiable. We’ll it’s a risk that can go both ways.
Carol : What about, because I think this is important now, I’m looking at this thinking it might be something people want to at least think about. What are tax treatments?
Bob : Spousal maintenance is deductible by the party paying. It comes right off the top of your income. Uncle Sam’s going to help you pay your spousal maintenance if you have a spousal maintenance obligation. If you’re in a 30% tax bracket 30% of that money would have been paid to taxes anyway. Uncle Sam is going to subsidize your spousal maintenance payment.
If you’re on the receiving end it’s taxable income. You’ve got to pay tax on that spousal maintenance down the road. There is a little prevision called recapture. You have to be careful about if you change the amounts too much during the first 3 years the government might come in and disallow the deduction or change the treatment on the receiving end. Check with your tax accountant.
Your attorney will know enough to send to a tax accountant if you’ve got a situation like that. That only applied during the first 3 years changes after …. We often get cases where spousal maintenance is 1 amount for 5 years, a different amount for another 3 years. Even a lower amount for the last 2 years, maybe on a 10 year award.
It can be very flexible. Whatever the parties want to agree to. I’ve had cases where the spousal maintenance started out lower and then became higher down the road because of the particular situation involved. Ideally, I think what the courts are looking to do what everyone’s looking to do is to get the spouse that’s being divorced back on their feet again. Typical is that an award for 4 or 5 years assuming the spouse would go back get some training. Go to college. Do whatever and then become employed and you see that quite a lot.
Carol : Right, now and that’s really what it was for in the beginning. For the woman, or whoever, the man to get back on their feet.
Bob : Well, Carol that’s the interesting thing. Back in ’73 when the women’s movement was really going running and gunning and the changed the divorce statutes to make it a no-fault statute, and the assumption was that everybody 4 years of college training you’ll be back to making the same amount of money. Well they actually liberalized the spousal maintenance back statute back in the late 80’s because they forgot. The men had been on the power crew forever. The women are just starting they’re never going to reach the earnings capacity. They actually liberalized it a lot in the late 80’s.
Carol : Give them a call their number is 602-548-4600. It’s Arizonalawgroup.com.