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Free-Trader Agreements in North Carolina

Posted by on Jan 12, 2019 in Blog, divorce, Equitable Distribution of Marital Property and Debt, Family Law | 0 comments

Free-Trader Agreements in North Carolina

Free-Trader Agreements in North Carolina When a married couple separates, if they can reach an agreement on all of the issues between them, they may choose to sign a separation agreement. It is a contract that says how they have agreed to divide property and debt, how family support will be provided, if any, and what they will do about parenting time if they have children together. One of the usual terms contained in it is a free-trader-agreement (FTA). If there is no separation agreement, an FTA can be a short contract by itself. What’s the Problem? Many couples own real estate when they separate. After time passes but before the divorce is granted, some people consider home ownership. When married couples acquire a mortgage loan, both usually sign the promissory note, which means they both have a legal obligation to make mortgage payments. That’s pretty straightforward. But when only one spouse signs a promissory note, only he or she owes the money. To oversimplify the problem, if the home-owner dies before becoming divorced, the surviving spouse has no legal responsibility to make the mortgage payments. But regardless of the fact that a married couple is separated, as a spouse, the non-home-owner would still have certain inheritance and survivorship rights to the property. Remedy #1 – Free Trader Agreement Mortgage lenders require parties to sign an FTA, which is an agreed-upon right to buy (i.e., trade) freely (i.e., without interference). Mortgage lenders lend money to buy a home that will be theirs if they foreclose on the loan. They don’t want to share any ownership of the home with the surviving spouse (who isn’t obligated to make mortgage payments). The purpose of an FTA is for the spouse who is not buying the home agrees to waive all claim to it, including inheritance and/or survivorship rights. Usually recorded on public record at the office of the Register of Deeds, these contracts clarify that the spouse buying the home has exclusive ownership of it, even though he or she is married. Because the FTA is a contract, both parties must voluntarily agree to sign it.  Remedy #2 – The Divorce When a divorce decree is granted, the other person is no longer a spouse, so the mortgage lender no longer has the problem of an ex who is still a surviving spouse even if they were separated for some time when the home was purchased. However, in North Carolina, a spouse can’t even sign the divorce complaint, which generates the lawsuit, until he or she has been separated for at least one full year. When a spouse files for a divorce, it usually takes another two to three months before the divorce decree is granted. When the other spouse refuses to sign an FTA, the only remedy is the divorce, which is nearly impossible to contest because it is based on a one-year separation. Amy A. Edwards is a family law attorney at Amy Edwards & Associates, PLLC, in Greenville, NC. She is certified by the NC State Bar Board of Legal Specialization as a Family Law Specialist, and is licensed only in NC. Laws change. This article is current as of...

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Biofeedback: Another Tool For Managing Divorce Stress

Posted by on Dec 27, 2018 in Blog, Resources | 0 comments

Biofeedback: Another Tool For Managing Divorce Stress

Biofeedback: Another Tool For Managing Divorce Stress By Tami Maes Fragedakis, PhD, LPC, BCB, LRT, CTRS* Experiencing a divorce is ranked as the second highest stressor of all life transitions (Holmes-Rahe, 1967). While people may react differently to a divorce, the life changes and transitions that accompany this experience have consequences. The many negative effects that occur may be detrimental to one’s physical and mental health (Amato, 2012). Without proper coping tools, experiencing a stress response for a duration of time may result in dysfunctional patterns of behavior and additional psychological distress. Biofeedback is an alternative form of therapy that can be used to reduce stress and gain control over the physiological dysfunctions that accompany life’s transitions.   Biofeedback is a training modality used in conjunction with therapy. Through training, individuals are better able to understand and identify their personal, physiological responses to stress. In addition, individuals are able to manipulate their personal reactions, thus enabling control over the symptoms they experience. Non-invasive sensors are attached to the individual to measure the body’s internal reactions. These include heart rate variability, skin temperature, skin conductance, and electrical activity of the muscles. The sensors are connected to a biofeedback device which quantifies the data. The information is then displayed on a computer screen in the form of visual and auditory feedback.  The therapist helps the individual make sense of the information according to their symptoms experienced and then teaches the individual how to control these parameters. Working in the same way as biofeedback, neurofeedback entails non-invasive sensors which are attached with conductance paste on various places of the individual’s head. Electrical activity of the brain, or brain wave data, is then recorded and computed with the biofeedback equipment and displayed on a computer screen for the individual to see. The therapist explains these signals in relation to thoughts, emotions, and symptoms presented. The participant can then ‘see’ the electrical activity of their brain and how this activity changes with certain thought patterns and while experiencing various emotions. The brain creates loops or ‘highways’ of information. Neurofeedback allows the individual to see these feedback loops. Training thus enables the individual to change the feedback loops within the brain and create healthier pathways. The process allows the person to regulate their own brain wave activity to improve overall mental and emotional health and achieve their desired mental performance. Experiencing stress in response to life events is normal. How an individual handles this stress is imperative to their overall wellbeing. Biofeedback measurements provide a visual representation of the internal stress responses in real time, which increases their self-awareness, and provides validation for the individual’s lived experience. The primary goal of biofeedback training is to provide necessary tools for individuals to develop a skill-set in order to better control their stress response and become their best self. With the ability to self-regulate, participants are able to diminish the impact of stress on their daily life, decrease symptoms associated with mental health conditions, and achieve emotional well-being.   * Dr. Fragedakis is a Licensed Professional Counselor in the state of North Carolina and is board certified nationally in biofeedback. She owns Capital Biofeedback, Inc. in Cary, North...

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Second Thoughts About Separating: Should We Reconcile?

Posted by on Dec 16, 2018 in Blog, Relationships | 0 comments

Second Thoughts About Separating: Should We Reconcile?

Second Thoughts About Separating: Should We Reconcile? By Amy A. Edwards After spouses separate, they routinely hire attorneys and begin the negotiation and/or court process, which almost always causes the relationship to further deteriorate. But on occasion, there are couples who separate but then find their way back to each other. Separating and Reconciling In North Carolina, if spouses live in separate residences, and at least one of them has the intention to remain separated from the other, they are considered separated. But the law is murky on the topic of what it means to reconcile, resuming the marital relationship and “canceling” the separation. It is decided on a case-by-case basis, and is not proven by isolated incidents of sexual intercourse. NC Gen. Stat. §52-10.2. Although reconciling usually means both spouses moving into the same household together again, there are a number of complicating legal factors to decide whether the spouses have actually reconciled. This means a dispute over whether you have reconciled will probably be expensive. Why Does it Matter? The world of family law revolves around the date of separation. The law requires a full one-year separation before either party can file for a divorce. If the spouses separate and then reconcile, the clock starts over again, requiring a one-year-separation. Marital and non-marital assets and debts are defined, classified and valued based on the date of separation. Changing the date of separation by reconciling and separating again at a later date can have a huge financial consequence. Likewise, the date of separation can be critical in alimony and child support cases too. If the parties signed a separation agreement or there were court orders in place when spouses reconciled, that triggers another layer of problems beyond the scope of this article. What is the Motive for Reconciling? It can be difficult to know whether the other spouse’s reason for trying to mend their relationship is genuine. People should consider talking with a counselor or other professional who can address the personal relationship between the spouses. Like any other major decision, a spouse should think long and hard about jumping back into the same situation that has already caused so much grief and expense in the first place.  As for their legal relationship, the first question to ask is whether the other spouse has any legal incentive to reconcile. Fault can be a useful tool in alimony cases. If someone has committed marital fault in the eyes of the law, such as adultery, he or she probably has a good legal reason to seek forgiveness, regardless of whether there is heart-felt regret or even a personal desire to reconcile.  Serious Consequences An attorney might advise a spouse to move back into the family home and gain access to confidential information, sneak out personal property like jewelry, or avoid the cost of operating two households while he or she saves money to hire an attorney. Once that spouse feels he or she has the upper-hand, what will be necessary to get him or her out of the house again? That creates new risk for new marital fault, and it will almost certainly cost you more money to address again. If you are considering a reconciliation, talk with your attorney BEFORE making a final decision. Find out what you can...

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What in the World is Divisible Property?

Posted by on Dec 5, 2018 in Blog, Equitable Distribution of Marital Property and Debt | 0 comments

What in the World is Divisible Property?

What in the World is Divisible Property? By Amy A. Edwards Marital property is property that a married couple owns when they separate, as long as they acquired it during the marriage. Separate property includes property that you owned before marriage, property that was a gift to you individually, or inherited property. In 1997, North Carolina created something else, divisible property. [1] This article barely scratches the surface of it, and does not include divisible debt. What’s Included in “Divisible Property”? Only property owned on the date of the separation is marital property. But what happens to marital property after you separate? The time from the date of separation until the date that the case finally reaches the courtroom can easily be a year or longer. If the value of a marital asset changes, the court will decide what to do with that change in value. If the court says the change in value of marital assets is divisible property, the amount of that change will be divided 50/50. Otherwise, the change in value will not be divided and that change in value is kept as separate property. For Example . . . Assume your home is worth $200,000.00 when you separate, and that you still live there. By the time you reach the courtroom, after 13 months have passed, the value increases to $225,000.00. The judge will decide whether that $25,000.00 difference in value is divisible property. If so, it will be equally divided and each spouse would get value worth $12,500.00. On the other hand, if the difference is not divisible property, that increase in value is the separate property is yours. What Makes the Change in Value Divisible? The increases and decreases in the value of marital property after separation are assumed to be divisible property, and divided equally. This assumption is based on things such as inflation, changing economic conditions and market forces, the mere passage of time and changes in tax assessments. These increases in value are divisible property because they are natural changes, which the court calls these changes “passive” in nature, generally beyond either spouse’s control. What Makes the Change in Value Separate or Shared Property? Although the law assumes that the change in value is divisible property and equally divided because the change in value was passive, you can offer evidence to show why the change in value is not passive. In other words, if you want to show that the increase in value is your separate property, you have the burden of proof to show why. To meet that burden, you must prove the changes in value are directly caused by your action after separation. What counts as activity? For example, after the separation, you decide that the house would sell for a much higher price if you renovate the kitchen and add an extra bathroom. If you can prove that your individual actions actually caused the increase in value, the increase would not be divisible property. Therefore, the $25,000.00 increase in value from our example above would be awarded to you as your separate property.         [1]  NC Gen. Stat. §50-20(b)(4). Amy A. Edwards is a family law attorney at Amy Edwards & Associates, PLLC, in Greenville, NC, certified by the NC State Bar Board of...

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Can’t We Just Pick a Date of Separation and Get Our Divorce?

Posted by on Nov 22, 2018 in Blog, divorce | 0 comments

Can’t We Just Pick a Date of Separation and Get Our Divorce?

Can’t We Just Pick a Date of Separation and Get Our Divorce? We hear this question all the time. The short answer is no, you can’t choose a date of separation. In the real world, efficiency and common sense would suggest that you could. But this is not an agreement to apply for “services” from the government. It is a lawsuit, and a judge must use the law. Divorce is a legal status, similar to a legal status of biological parent in a paternity case, for example. Each state has laws dictating how long a married couple must be separated before they are eligible to divorce. Here in North Carolina, the law requires a one-year separation. This should not be confused with our residency requirement. It requires at least one spouse to live in this state for six months before he or she is allowed to file a claim for divorce, even if the parties have already been separated for a year when one spouse moves here. All Divorces Are Lawsuits It can be easy to forget that even uncontested divorces are filed by a plaintiff, served on a defendant, and ruled upon by a judge. In fact, most people don’t even have to be in court. Except for incurable insanity, the only ground for a divorce in North Carolina is a one-year separation. This requires that at least one spouse intends for the separation to be permanent, although there is no requirement that the lawsuit say which spouse intends to remain apart. Examples of one-year separations that don’t fit into this category are couples who are only separated by military service or incarceration. They are not separated unless one spouse intends to remain separated (i.e., that person does not want to move back home when no longer physically separated). The divorce complaint, the document that starts the lawsuit,  cannot even be signed until the day after the year has passed. When you sign the complaint, you do so under oath, under penalty of perjury, which is a crime. Worse yet, if you lie about the DOS, your fraudulently obtained divorce can be set aside (voided) because you were not separated for one full year. Why Do We Have to Wait a Year? The government doesn’t want you to have a fight with your husband or wife, separate for a few days or weeks, get divorced and then reconcile and remarry. Many lawyers, myself included, believe the length of separation is too long. Some states require a longer wait only if the couple has children, and let the non-parents divorce much sooner. Although many believe the waiting period is excessive, it is the law and we must all obey it. There are plenty of others who believe one year isn’t long enough. Our state laws used to require a two-year waiting period. Not too long ago, there was a proposed “Healthy Marriage Act” that would’ve restored the two-year waiting period. In fact, it would have required counseling of some sort for parents and non-parents alike. Can We Just Stay on Opposite Ends of the House? Although the idea of separating in the same house is a clever one, it is inadequate. A separation requires living under two different roofs. This can be difficult for couples who don’t have enough...

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Is Credit Card Debt Marital?

Posted by on Nov 12, 2018 in Blog, Equitable Distribution of Marital Property and Debt | 0 comments

Is Credit Card Debt Marital?

Is Credit Card Debt Marital? By Amy A. Edwards In short, credit card debts can be marital, just as any other type of debt. In contrast with marital property, the law doesn’t assume a debt is marital just because it was incurred during the marriage. If a debt is marital, each party is equally responsible for it, although the court usually assigns it to one party to equalize the net part of property each party gets. If a debt is separate, it isn’t calculated into the marital estate, and the person who has the account in his or her name is responsible for it. To understand credit card debt, we must first look at what a marital debt is. The Timing of Marital Debt A marital debt must generally be incurred by one or both spouses while they are married and before the date of separation (DOS). One exception to that rule is when one spouse takes a loan after DOS to pay off the “old” marital debt that existed on DOS. [1] Like marital property, marital debt must exist at DOS. If you just paid off your credit card with your bonus from work, and then you separate, the debt doesn’t exist at DOS and it is not a marital debt for which you would get credit for paying. What’s in a Name? Marital debt can be in the names of one spouse or both. However, there is one important distinction between debt and marital debt. The court can say who is responsible but only as between two spouses. But the court can’t tell a third party, such as Mastercard or Visa, that they can only enforce the debt against one person when two people signed the agreement to repay them. The court may indemnify a spouse, meaning that if the husband is assigned to pay the credit card debt and he fails to do so, he has to repay the wife if the credit card company sues her for payment. But if the other spouse had the money to repay you, he or she would’ve probably paid the debt in the first place. In practice, indemnification only goes so far. Joint Benefit: The Key Issue Unlike marital property, to call a debt marital, it must be incurred for the joint benefit of the parties. [2] There is no presumption that the debt was incurred for the benefit of both parties. If you want to prove the credit card debt is marital, you have the burden of proof to show that the charges were made before DOS and that the charges were incurred for the joint benefit of the parties. Courts have vast discretion in ruling on whether charges benefited both parties. Charges for groceries and gas probably are, but charges for one spouse’s dental treatment [3] or student loan debt probably aren’t. [4] Most people make on-going charges, including charges made after DOS. Another difficulty can be non-descriptive statements. It is difficult to prove what you purchased from Wal-Mart for $175.43 from six or seven months ago, and then prove it was a joint benefit. Another serious difficulty is proving what the outstanding credit card balance on DOS (none can be after DOS) was used to purchase. If the balance at DOS resulted from purchases made over the last three years, you still have to prove which ones were marital, incurred for the joint benefit...

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Standing: Who Can and Can’t File for Child Custody

Posted by on Oct 7, 2018 in Blog, Child custody, Court | 0 comments

Standing: Who Can and Can’t File for Child Custody

Standing: Who Can and Can’t File for Child Custody The ability to file a legitimate lawsuit for child custody is extremely limited. A person must have “standing” to file, which “relates . . . to the right of the party to have the court adjudicate a particular dispute.”[1] You must have some vested interest in something before you can even ask the court to rule on the controversy. Which Parents Can File? Parents automatically have standing to file for custody against each other because they both have equal constitutional right to the care and custody of their child. They have equal rights to their child unless there is a court order or they have a custody agreement. However, our statutes forbid anyone who is convicted of the following crimes, and which resulted in the conception of the minor child, from filing a child custody claim: first-degree forcible rape, second-degree forcible rape, statutory rape of a child by an adult or first-degree statutory rape. [2] Which Non-Parents Can File? When non-parents have custody, they are usually family-members because they are likely to see the child regularly, care for the child or have a strong bond with the child. It has little to do with which relative asks for custody. Instead, it has everything to do with the behavior of the parents. A non-parent only has standing to file for custody in the event that both parents are unfit or have taken actions that are inconsistent with their constitutional right to the care and custody of their child. This standard is the same as any non-parent. This even applies to grandparents who cannot sue for custody merely by virtue of their status as grandparents, although they may seek visitation in limited circumstances. Who Else Has Standing to File? Proving that the parents are unfit or that they have acted inconsistently with their rights is a huge hurdle. Constitutional rights protect parents who are merely adequate, or parents who don’t do a good job of parenting. But if the non-parent proves the parents are unfit or behaved inconsistently with their rights, our statutes set out a very broad list of potential custodians: “Any . . . other person, . . . claiming the right to custody . . . may institute a . . . proceeding for the custody of such child. . .” [2] But the non-parent cannot be a stranger to the child. He or she must have a relationship with the child that’s in the nature of a parent and child. These aren’t just magic words. To have standing, that non-parent must truly prove why the relationship is in the nature of parent and child, that they have bonded with the child. The statute also authorizes an “agency, organization or institution” to seek custody when authorized by law. This includes the NC Department of Social Services/Child Protective Services. [2] [1] Bunch v. Britton, 802 S.E.2d 462 (2017). [2] NC Gen. Stat. §50-13.1. Laws change. This article is current as of 2018....

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What is Marital Property in North Carolina?

Posted by on Sep 29, 2018 in Blog, Equitable Distribution of Marital Property and Debt, Family Law | 0 comments

What is Marital Property in North Carolina?

What is Marital Property in North Carolina? Before 1981, our state had traditional title ownership. This meant that the assets would be awarded to the person in whose name they were owned if a couple divorced. If the house or vehicle was in the husband’s name, for example, the wife received no share of the value for it. Reform: Equitable Distribution Some states have what they call community property. Instead, we use a process known as Equitable Distribution to divide marital property. After a particularly harsh result in a 1979 case that demanded reform, an equitable distribution statute was created, NC Gen. Stat. §50-20. Title ownership was fairly straight forward, but the newer process has lots or grey area. Instead of strictly using the law to simply look at the name on the deed or car title, the statute requires judges to divide property fairly (i.e., equitably) between spouses. When the court decides property is marital, it is given to (i.e., distributed to) one spouse or the other, even if his or her name is not on the title or other ownership title. Equity gives the judge discretion to award assets as he or she sees fit, so long as it is within the terms of the law. The law requires judges to divide marital property equally unless one uses his or her discretion to do otherwise when there are special reasons. Marital Property Definition Marital property includes land and personal property that is acquired by either or both spouses during the marriage but before they separate. It must also be owned at the time they separate. If it meets these requirements, the property is legally presumed to be marital. In other words, if a spouse wants to show that property is his or her separate property, he or she must prove it is separate property. To beat the legal assumption that it is marital property, he or she must prove the property was acquired before they married, after they separated, or acquired by a spouse by devise (property transferred by a will) or by descent (property inherited upon death). What Counts as Property? The current statute includes just about everything with a dollar sign on it, and a few things that don’t have any real value, such as photo albums, or even a negative value such as an overdrawn bank account. Other examples you might not think of include cemetery property, frequent flyer miles, gambling or lottery winnings, pets. Traditional assets include retirement and investments, businesses, royalties, collections of any kind, furniture and household property, and jewelry, to name just a few. However, all professional licenses and business licenses which would terminate on transfer are automatically separate property.  When marital asset has a lien or debt against it, like a car note or loan, that court typically ties the debt to that particular asset. If you receive the car, you usually get it along with financial responsibility for the car note and the payments. But the court has the authority to assign it to the other spouse. The law has an odd provision about gifts one spouse gives the other while they are together. They are marital unless the gift giver specifically says he or she intends the gift to separate property when the gift is given. As you might expect, that...

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Link Share: Domestic Violence Resources – www.domesticshelters.org

Posted by on Sep 22, 2018 in Blog, Domestic Violence | 0 comments

Link Share: Domestic Violence  Resources – www.domesticshelters.org

  I don’t usually share links to my blog posts but this site has incredible resources to offer. It is not just about shelters. Anyone who is facing domestic violence should bookmark it. I’ll also add it to our web site. 23 Ways Survivors Can Collect Evidence of Abuse www.domesticshelters.org  ...

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Life or Death Decisions: Healthcare Powers of Attorney

Posted by on Sep 15, 2018 in Blog, Elder Law | 0 comments

Life or Death Decisions: Healthcare Powers of Attorney

Life or Death Decisions: Healthcare Powers of Attorney By Amy A. Edwards Using a Healthcare Power of Attorney (HCPOA), you may designate an agent to make medical decisions for you if you are unable to do so. You must be legally competent to sign the HCPOA, but it remains in effect even if you later become legally incompetent. When is the HCPOA Triggered? The HCPOA becomes effective when an adult “lacks sufficient understanding or capacity to make or communicate decisions relating to [his or her] health care.” [1] You can choose the physician(s) that you trust to determine whether you are unable to make or communicate your healthcare decisions. The Agent’s Authority Your Health Care Agent makes decisions based on what you direct in your HCPOA. The default is to allow your agent to make any and all medical decisions for you. But it is your job to set any limits, restrictions, requirements or special conditions. Like any fiduciary, a trusted person given the ability to act on someone’s behalf, the agent must act in good faith when carrying out your instructions. Setting Limits in Your HCPOA General Health Care Decisions. Choose whether your agent has access to your medical records, can hire and fire medical providers, and the right to place you in, or release you from, a hospital or other facility, such as assisted living or nursing home. Mental Health Care. Authorize or prevent certain mental health treatment, such as psychoactive medications or shock treatment. Consider whether the agent can admit you to, or keep you in, a mental health facility, and if so, your preferred facility. The state can always keep you in a facility based on civil commitment laws, for example danger to yourself or others. Life Prolonging Measures. This is your right to a natural death. [2] Choose whether to allow or withhold life prolonging measures, such as a mechanical ventilator, artificial nutrition (i.e., feeding tube) or artificial hydration. Most people want “reasonable steps to keep me as clean, comfortable, and free of pain as possible so that my dignity is maintained, even though this care may hasten my death.” You can say that some/no life prolonging measures will be given in the following situations, described in that statute: An incurable or irreversible condition that will result in your death within a relatively short period of time; or You become unconscious and, to a high degree of medical certainty, will never regain consciousness; or You suffer from advanced dementia or any other condition resulting in the substantial loss of cognitive ability and that loss, to a high degree of medical certainty, is not reversible. Matters of Death. If you don’t already have valid arrangements when you die, the agent can request an autopsy or even dispose of your remains (i.e., cremated or buried). You may or may not want to donate any needed organs or parts, or to donate your body. See the NC Donor Registry for information about donating. Adding Things to Your HCPOA Add what’s important to you. You can identify welcomed visitors at any facility where you might be. Naming a legal guardian to care for you if you are unable to do so might avoid litigation among family members about who should serve, and whether to require bond. How Long is the HCPOA Effective? It ends when you revoke it or die, unless you authorize him or her to do other tasks related...

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