Split Ends: What Happens When the Rich Divorce

$plit ends By LINDA STASI Last Updated: 11:37 AM, March 29, 2011 Posted: 11:11 PM, March 28, 2011

The most shocking thing about tonight's quite interesting CNBC documentary, "Divorce Wars," is the discovery that for insanely greedy newly-rich people, a bad divorce will cost them even more than their out-of-control, million-dollar-plus weddings!

Correspondent Melissa Francis takes a look at some of the most repulsively fascinating -- and expensive -- divorces of recent times including the divorce of the guy who brought us PayPal, Elon Musk. According to divorce-attorney-to-the-rich Raoul Felder, now that we're in the age of no-fault community property splits, divorces are no longer about which spouses cheat -- but about how spouses try to cheat each other out of the shared assets. Take the Musks, for example. He and his future wife, Justine, met when they were in college. Shortly thereafter, they moved in together into a terrible college apartment with two roommates and three dogs. They got married after he struck it rich, and he had her sign a post-nup agreement. Eight years and five kids later, they split and then all hell broke loose. He was worth billions, and she had agreed to a $750,000 post-nup pay out. Fair? Wrong? Incredibly greedy? How much does one guy need?

Then, there's the infamous case of Margaret Spenlinhauer, the Connecticut housewife and mother of scores of kids whose very rich husband immediately seemed to suddenly be not very wealthy after they split up. It took 18 -- yes, 18 -- years for her to personally find the money he'd hidden. And his deception amounted to fraud -- a criminal offense. Another rich guy's wife snooped in his computer, opened his journal and discovered that he considered her an unfit mother. What did she do? Loaded up his computer with kiddie porn and then took it to her attorney. Millions of dollars and a federal investigation later revealed that she had loaded it all up during one week -- when he was out of town -- and then erased the memory so it couldn't be traced back to her. The result? It was so dastardly a deed that she even lost custody of her own kids.

But, seriously, what kind of idiot keeps a journal on his computer? A psycho, that's who.

As Felder says, "If you go into a marriage without a pre-nup, you don't need a lawyer, you need a psychiatrist."

Financially Preparing for a Divorce

Financially preparing for a divorce

It's the busiest time of the year for divorce lawyers. Family law attorney Kelly Chang talks with Tess Vigeland about why so many people seek to end a marriage at this time, the average cost of divorce and what she thinks about pre-nups.


Click here to listen to the interview.

TEXT OF INTERVIEW

TESS VIGELAND: We've gone a couple of weeks now without hearing about it being the "most wonderful time of the year." So let's get right to the not-so-wonderful part of the year. January is considered the busy season for divorce attorneys. And as the economy returns -- somewhat -- to normal, the American Academy of Matrimonial Lawyers reports an uptick in clients wanting to end their marriages.

Los Angeles family law attorney Kelly Chang is here to talk money, marriage, and the dissolution thereof. Welcome.

KELLY CHANG: Thank you. It's good to be here.

VIGELAND: What is it about this time of year that encourages people to take that first step toward ending a marriage. Were they just hoping to get through the holidays?

CHANG: Yes. There's a lot of that. And it's also the same reason you see long lines at the gym. It's New Year's resolution to be single.

VIGELAND: So much of this is circumstantial based on the individual lifestyle, but what does the average divorce cost?

CHANG: Well, it really depends. If you hire a divorce lawyer, they're going to bill you by the hour. You can do it on your own for relatively cheap. So it really depends. It's kind of like a roof -- you can do it for cheap or you can hire a professional contractor to do it for a lot more.

VIGELAND: Let's talk a little bit about how people can prepare themselves for this happening. What should each party start doing with their finances?

CHANG: Generally, I see in a couple, in a relationship, somebody assumes the total responsibility, leaving the other person in the dark. So if you're the person in the dark, I would get out of the dark. Find the latest statements -- they're mailed the house or you could call the bank. What matters, if you don't have a pre-nup, is what is acquired during the marriage and that includes credit card debt.

VIGELAND: What do you find in terms of the cost for trying to get a settlement between yourselves versus going to court?

CHANG: Much better.

VIGELAND: Court has to be more expensive.

CHANG: Everything costs money, so if it takes up too much time, it's costing too much money. So if you can reach a settlement agreement, do it on your own. It saves money.

VIGELAND: What do you find in terms of couples being able to do that. Is there a ratio of amicable to not amicable divorces?

CHANG: It's interesting. I think in the past few years, I have seen a rise in more amicable behavior in the divorces and it's probably because people can't afford to fight.

VIGELAND: Ah, because of the economy?

CHANG: Correct.

VIGELAND: Because I have a divorce attorney in the studio with me, I do have to ask about your thoughts on pre-nups. Based on your experience with couples going through a divorce, does it help? Does it make things easier or worse?

CHANG: I think it makes things much easier. Get a pre-nup. Marriage is grand. Divorce is twenty grand. Get a pre-nup. Get a pre-nup. I don't care if you don't have anything. You have to come in. If you have a 401(k), half of that could be belonging to your spouse, whatever is accumulated during the marriage. You have to protect yourself.

VIGELAND: Kelly Chang is a family law attorney here in Los Angeles, and we've been talking about January as a big month for, unfortunately, divorces. Thanks for coming in.

CHANG: Thank you, Tess.

Why Buy the Cow When You Can Get the Milk For Free? Answer: Cuz It Ain't Free!

Live-in lovers break up... then pay up: Court hearings boom for unmarried couples
By Tamara Cohen




Couples who break up following a live-in relationship are paying tens of thousands of pounds in settlements to their former partners.


A new phenomenon of ‘break-up payments’ is increasingly common because more and more couples are living together for several years without marrying.


When a marriage collapses, a spouse is usually entitled to half the couple’s assets, but for cohabitees the legalities can be a minefield.

Law firm Pannone has reported a 40 per cent rise in these payments in the past five years, claiming people are taking advantage of the uncertain legal status of unmarried couples to issue ‘nuisance’ demands.

Some people were willing to pay up to £100,000 to former partners to avoid lengthy legal action which can last up to 18 months, it said.

Recent actions have involved custody of children, jointly owned property, bank accounts and even pets.

There are 2.3million cohabiting couples and the number is expected to double in the next 25 years. One in four children is born to cohabitees.

Vicki McLynn, a senior associate at Pannone, suggested the problem was partly due to such disputes being dealt with using property rather than family law, as no legislation had yet been passed making clear the rights of unmarried partners when they split up.

She said: ‘It can ultimately be a case of “he said, she said” – one partner’s ability to be more convincing than the other in court can be crucial in determining how cases are settled.

‘Given that element of risk and the assets at stake, many family and litigation lawyers in our firm and elsewhere are seeing clients wanting to pay up to end the matter.’

Unmarried couple Jim Carrey and Jenny McCarthy split after five years together. They are not thought to have sought settlements from each other

In 2007, the Law Commission published a series of recommendations for the government following a review of the rights of unmarried couples. It concluded that the ‘unclear’ current law made for ‘unfair’ outcomes.

The commission urged a series of reforms including legislation enabling unmarried men or women who had lived together for at least two years to make a claim against their ex-partner. The recommendations have so far not been acted upon.

Miss McLynn suggested that while some disputes involved individuals who had genuinely made contributions to building up joint assets, others featured demands which could best be described as ‘nuisance’.

She said: ‘We have seen instances in which people have issued demands to complicate their exes’ new relationships.’

Earlier this year, family law firms reported a 15 per cent rise in the number of cohabiting clients seeking advice on relationship breakdown as a result of the recession.

Marriage Advice for William and Kate

LONDON (AP) — Prince William and fiancee Kate Middleton have another chore on their must-do pre-wedding list: Sit down with priests to think about the vows they will make.

The couple are expected to meet Archbishop of Canterbury Rowan Williams and Bishop of London Richard Chartres before they marry April 29, palace officials said Wednesday. Both clergy will be involved in the wedding ceremony at London's Westminster Abbey.

"It's customary for a priest to meet with the couple before their wedding," said Maria Papworth, Williams' spokeswoman.

These marriage preparation sessions include discussions on how to handle marital disagreements and how to prepare for the changes brought on by parenthood. Meetings often take place in groups, but talks for the soon-to-be royal couple will be private and strictly confidential.

The marriage of William's parents, Prince Charles and Princess Diana, ended in divorce. St. James Palace would not comment on whether they also received similar attention, but it is normal practice for a Church of England wedding.

For more marriage advice (from a divorce lawyer), see here.
Copyright © 2010 The Associated Press. All rights reserved.

Dodgers Divorce: Judge Gordon Throws Out Postnup

Judge rules in favor of Jamie McCourt in Dodgers ownership struggle








See the Statement of Decision.

The decision denying Frank McCourt's claim to sole ownership of the team is not expected to immediately affect day-to-day operations. He may use other legal strategies to challenge his ex-wife's case.

By Bill Shaikin and Carla Hall

Frank McCourt is not the sole owner of the Dodgers, a judge ruled Tuesday, a decision that keeps the team in legal limbo for what might be several more years.

Los Angeles Superior Court Judge Scott Gordon granted Jamie McCourt's plea to throw out a 2004 marital agreement that would have left her without an ownership share in the Dodgers.

"The court finds that the marital property agreement is not a valid and enforceable agreement," Gordon wrote in his ruling. "The court orders that the marital property agreement is set aside."

The ruling is not expected to have an immediate impact on the day-to-day operations of the team. Frank is expected to employ other legal strategies to dispute his ex-wife's claim to co-ownership of the team.

Frank could decide to appeal Tuesday's ruling. He already has notified the court he wants to use a different legal strategy in another claim to sole ownership of the Dodgers, one based on the concept that he bought the team with a company he established before his marriage to Jamie.

Frank's attorneys have said such a trial could be completed in one day and that all the necessary evidence is in the court record. Jamie's attorneys have said such a trial could require up to 60 days, preceded by months to collect new evidence.

Dennis Wasser, an attorney for Jamie, said he hoped the ruling would enable both sides to settle the case, for what he said would be the good of the Dodgers and the community. "We are very pleased that the marital property agreement has been invalidated. Now that Jamie has prevailed in this case, we hope it will be possible to resolve the matter in a reasonable way going forward."

Major League Baseball Commissioner Bud Selig has declined to comment on the case. The Times reported in September that the possibility of years of legal battles between the McCourts had prompted him to consider intervening on behalf of the Dodgers, but it is uncertain what options he might contemplate.

The McCourts also could use Gordon's ruling to renew settlement talks, with the validity of the 2004 marital agreement no longer a wild card in negotiations.

The sides have been unable to reach a settlement despite several rounds of discussions -- with and without mediators -- over the last year.

In the absence of a settlement, Gordon eventually would determine permanent spousal support. In May, Gordon ordered Frank to pay Jamie $637,159 per month in temporary support, including costs associated with the couple's homes.

The McCourts filed for divorce on Oct. 27, 2009, one week shy of what would have been their 30th anniversary.

In March 2004, two months after baseball owners approved their purchase of the Dodgers, the McCourts each signed a marital property agreement that specified the team belonged solely to Frank and the couple's homes belonged solely to Jamie.

In the initial phase of the divorce case -- and in a trial that lasted 11 days -- the only question before Gordon was whether the agreement was valid.

Frank asked Gordon to enforce the deal, arguing that Jamie was the driving force behind the agreement and that she had gotten exactly what she wanted from it -- that is, to protect the homes from creditors should the Dodgers suffer severe financial losses.

Jamie asked Gordon to overturn the agreement, claiming she never intended to surrender her rights to Dodgers ownership and never would have signed the document had she been explicitly informed of its impact in the event of divorce. She said she should be considered co-owner of the Dodgers.

As the trial approached, lawyers discovered the McCourts had signed six copies of the agreement, three of which listed the Dodgers as Frank's sole property and three that did not.

Larry Silverstein, the Boston lawyer who drew up the agreement, testified that he had botched the wording in the latter three copies and had corrected his mistake by replacing the relevant page in the agreement -- after the McCourts had signed the document, and without informing either of them of the alleged error.

Frank argued that Silverstein had made an unfortunate mistake but corrected it to conform with what Jamie had wanted -- that is, no financial responsibility for the Dodgers.

Jamie argued that Silverstein's blunder, whether innocent or intentional, resulted in two versions of the agreement with materially opposite terms. If one version said Frank owned the Dodgers and the other version did not, she contended, there never could have been an agreement in the first place.

bill.shaikin@latimes.com

carla.hall@latimes.com

Copyright © 2010, Los Angeles Times

Mediation for the McCourts

Mediation scheduled in McCourt divorce case

By GREG RISLING (AP) – 4 days ago

LOS ANGELES — Divorce lawyers for Frank and Jamie McCourt are planning to go into mediation as soon as Friday over who owns the Los Angeles Dodgers, The Associated Press has learned.

A person familiar with the case who requested anonymity because he was not authorized to speak publicly about settlement discussions told the AP late Tuesday that the two sides would meet in a downtown Los Angeles courtroom on Friday.

The mediation talks were first reported by Yahoo! Sports.

Jamie McCourt contends that she deserves a part of the team, while Frank McCourt argues that he is the team's sole owner. Earlier this week, she testified that she didn't read a postnuptial marital agreement which gave her estranged husband sole possession of the Dodgers.

An attorney who represented the couple and drafted the agreement said he replaced an addendum that excluded the Dodgers from Frank McCourt's separate property with wording that included the team and didn't notify Jamie McCourt about the switch.

Larry Silverstein, who is expected to resume his testimony Wednesday, said he made a "drafting error" when he prepared the agreement that didn't include the Dodgers, the stadium and the surrounding land, worth hundreds of millions of dollars from Frank McCourt's side of the ledger.

When Silverstein gave the documents to the McCourts to sign in March 2004, three had the team as Frank McCourt's separate property, and three others didn't. Jamie McCourt ended up signing all six; Frank McCourt signed three at the couple's Massachusetts home and the remaining three a couple of weeks later while he was in California.

The agreement is at the center of the dispute between the McCourts and could decide who owns the Dodgers. Superior Court Judge Scott Gordon must decide whether the pact is valid. He also could order the sale of the team.

Silverstein said the original plan was to have three copies of the agreement, one each for Frank and Jamie McCourt and one for himself. However, he decided at the last minute before the couple signed them to produce three other copies out of an abundance of caution.

"I was simply trying to have a set of protective documents," he said.

Silverstein said he doesn't recall switching the versions Frank McCourt signed in California that excluded the Dodgers with wording that did include the team, but believes he did so shortly thereafter after he looked at company records.

It wasn't until a few months ago, after forensic analysts were hired by both sides to examine the six copies, that it was determined Silverstein made the changes.

Jamie McCourt's attorney David Boies asked Silverstein if he thought it was OK to switch a legal document after it had been signed and notarized.

"In certain circumstances, yes," Silverstein replied.

Boies asked his fellow litigator, who has practiced law for more than 30 years, if he ever recalled a situation where an attorney had removed part of a legal document and replaced it with something else without the written permission of both parties.

"Express permission or implicit permission, no," Silverstein added.

Silverstein said he didn't tell Jamie McCourt about replacing the addendum that gave her husband the Dodgers. On Monday, she testified she never read the agreement, nor did anyone tell her, namely Silverstein, that she would be giving up her purported ownership stake in the team.

However, another attorney who worked at the same firm as Silverstein said he was directed by Jamie McCourt to come up with the marital agreement during a meeting at Dodger Stadium shortly after the team was bought in February 2004 for about $430 million.

Reynolds Cafferata said in conversations he had with Jamie McCourt, she asked him questions about California's community property provision and told him it was a family practice to keep assets separate.

"She said 'We do things differently. I own the houses, Frank owns the businesses,'" said Cafferata, who added Jamie McCourt wanted a draft agreement created quickly. "She was interested in having this done immediately."

Gordon on Tuesday excused several witnesses from testifying at the trial, including Major League Baseball general counsel Thomas Ostertag. The trial could end early next week. Gordon then has 90 days to make a ruling.

Copyright © 2010 The Associated Press. All rights reserved.

Madonna Divorce Rumors

Hollywood 411 summoned me to come discuss Madonna's impending divorce on air today. Unfortunately, I had other obligations.

Apparently, the couple who married December 22, 2000 (almost 8 years), are fighting nasty divorce rumors. Madonna has reportedly consulted with a divorce attorney. They allegedly have no premarital agreement.

Madonna is reportedly worth $595 million. So...What's at stake?

Properties

A £7 million family townhouse in Marylebone, London and a 10-bedroom, £6million property next door.

Two mews cottages for £2million each.

A £3.6million building in the West End used as the Kabbalah headquarters and a £1.6 million five-storey townhouse in Regents Park also used by the sect.

A £10million Ashcombe House estate in Wiltshire.

A £2million apartment in Manhattan, New York which overlooks Central Park and an adjoining apartment next door worth the same amount.



Cars

The couples vehicles include a £47,000 Audi Q7 4x4 a £35,000 Mercedes Benz people carrier and a £58,000 Range Rover 4.2 V8.

Here is a photo of the currently-intact family:


I do hope they can work it out.

Should I get a Prenup, and When?

Today, I received a phone call from a client wanting a prenuptial agreement. His fiancee drafted a prenup, and gave it to him. He wants changes. His wedding is on Saturday. "It's too late," I told him.

California Family Code section 1615 (c)(2) clearly states that "It shall be deemed that a premarital agreement was not executed voluntarily unless the court finds in writing or on the record all of the following: THE PARTY AGAINST WHOM ENFORCEMENT IS SOUGHT HAD NOT LESS THAN SEVEN (7) CALENDAR DAYS BETWEEN TIME THE PARTY WAS FIRST PRESENTED WITH THE AGREEMENT AND ADVISED TO SEEK INDEPENDENT LEGAL COUNSEL AND THE TIME THE AGREEMENT WAS SIGNED.

Obviously, this can be interpreted in several ways. I tend to be very protective of my clients, so my policy is that the FINAL AGREEMENT must be presented and accepted as final by all parties, then a waiting period of 7 days, AND THEN signatures. The signature may even occur on the date of the wedding, but to be safe, I recommend one week. This means, you should leave yourself AT LEAST two (2) weeks prior to the wedding to have a finalized agreement.

THIS MEANS you need to hire an attorney AT LEAST 4 -6 weeks prior to your wedding, so the planning, drafting, and negotiating can take place.

If you are planning a wedding, you need to make your premarital agreement part of the process. It is THE TO-DO on your list of to-do's.

I turned down the prospective client. I told him that the prenup is no good. Beware of attorneys out there who will draft a prenup 5 days prior to the wedding. You may as well do it yourself on a piece of toilet paper, and then flush it.

If you want to learn more about premarital agreements, please read my highly-informative ARTICLE.