DUTIES OF A PARENT OF A CHILD WHO REFUSES TO VISIT THE OTHER PARENT - A CASE OF FIRST IMPRESSION

Mom and dad marry in 1997 and divorce in 2003. They have one child. This case was highly contentious. Multiple filings about custody ensue.

In 2013 after their daughter reached 14 years of age, mom stopped bringing her to visitations. Daughter signed an affidavit with numerous complaints about dad and said she did not want to visit him. Mom filed multiple pleadings. Mom had remarried. As part of the flurry of new pleadings, her new husband petitioned for stepparent adoption.

Dad filed motion to hold mom in contempt for failure to comply with parenting plan after several orders directing the visitation schedule in the parenting plan to be followed -- and mom never brought the child to visit. Mom stated that she left it up to the child and the child did not want to see dad.

The trial court found mom in contempt and issued an order finding that she had committed Rule 11 violations and would be required to pay dad's attorney fees. The trial court also ordered that mom had to obtain the court's permission to file any further pleadings.

Mom appeals. Affirmed and remanded for the trial court to determine attorney fees, as the appeal of the Rule 11 finding was not a final order without the determination of attorney fees.

In this case of first impression, the Supreme Court found that when a parent fails to make reasonable efforts to require a recalcitrant child to attend visitation, the parent has not made a good faith effort to comply with the parenting plan and can be held in contempt.

Ordinarily, contempt orders are not appealable. However in family law cases, they are appealable if issued with an order affecting the substantive rights of the parties. Here the trial court ruled on numerous substantive issues. The trial court may only be reversed for a blatant abuse of discretion, a very high bar. The Supreme Court found no blatant abuse of discretion.

Here is a quotation that summarizes the Court view:

"¶34 A parent is not "a powerless bystander" in the decisions and actions of a child, and has "an obligation to attempt to overcome the child's resistance" to visitation. Rideout, 77 P.3d at 1182. A parent has "a great deal of influence over [a child's] ideas and feelings," which carries with it an affirmative responsibility to nurture in the child a positive regard for his or her other parent. Ermel, 469 A.2d at 685. Although we recognize the difficulty, at times, of compelling a child's compliance with parental—or judicial—directives, a parent must make a good faith effort to do so."

Marriage of Marez 2014 MT 333

COMPLEX TAX CONSEQUENCES SUBJECT TO LATER DO-OVER AFTER IRS RULES?

Missoula divorce involving a single corporation owning a grocery business and a ranch. Long term marriage with three grown children. The most significant issue was taxation. Wife claimed that the ranch could be transferred tax free to a subsidiary corporation, then to her tax free. 

Corporation was a C Corporation until 2010 when S Corporation elected, but with 10 year period of potential tax exposure. Wife's expert testified that an IRS regulated Divisive Reorganization (D Reorg) procedure could be used. Husband owned the corporation 100%. Under IRC 1041 the final transfer to wife of the new subsidiary corporation with the ranch assets only would be tax free. 

Trial Court accepted the Wife's expert opinion, despite contradicting testimony from Husband's corporate accountant that the D Reorg was impossible under tax law, and would result in a $272,000 estimated tax liability that was not taken into account by the trial court. 

The trial court issued an order in response to Husband's motion to amend that said a "... private letter ruling" would now be appropriate and alternative proposals to mitigate tax consequences considered if there is an adverse ruling from the IRS." Husband appeals on various valuation issues, but primarily on the tax issue. Husband argues the trial court failed to specify how or when alternative proposals would be "considered". 

The Supreme Court affirmed. The Supreme Court stated that if there was an adverse letter ruling or the IRS rejected the D Reorg, "Jim could then explore other options, including moving to modify the judgment." Paragraph 26. The Supreme Court did not say how long Husband had to figure this out or what the ultimate result would be. 

They state that the Husband could file a motion to amend the judgment later after a definitive ruling by the IRS to adjust the distribution of the marital estate to incorporate tax consequences. That itself is rife with problems, however. For example, if there is a substantial tax consequence, what valuation date should one use for determining the ultimate distribution to be equitable. If there are intervening valuation changes in the ranch, or the business does poorly – what then? Also, will there be an issue about whether the Husband (who opposes this D Reorg) has done an effective job of presenting this to the IRS when he is on the record stating it cannot be done? Interesting.

Edwards v. Edwards 2015 MT 9