California Marital Settlements: March 1997 Summary

Legal Developments

Deductibility of Attorney's Fees

Pursuant to Internal Revenue Service Tech. Advice Memo 9542001 (released 10/20/95), in order for attorney fees payable to an attorney to qualify as spousal support, they must terminate upon the death of the payee spouse. If the obligation to the attorney is absolute, it runs afoul of Internal Revenue Code Section 71 (b)(1)(D), which states that a payment will qualify as spousal support if there is no liability to make such payment for any period after the death of the payee spouse and if there is no liability to make any payment (in cash or property) as a substitute for such payment. The IRS has held that payments that had the potential to continue beyond the payee's death were not deductible as spousal support. The program now asks if you want to include a provision terminating the obligation to pay attorney's fees after the death of the payee spouse, if you're treating ongoing payments as deductible spousal support.

Notarized Signatures Required in Default Proceedings

The program has always encouraged you to obtain notarized signatures of the parties where possible. Commentary now reminds you that newly enacted Family Code Section 2338.5 requires notarization where the divorce is to be granted upon the default of one of the parties.

Job Training

Newly enacted Family Code Section 3558 provides: "In a proceeding involving child or family support, a court may require either parent to attend job training, job placement and vocational rehabilitation, and work programs, as designated by the court, at regular intervals and times and for durations specified by the court, and provide documentation of participation in the programs, in a format that is acceptable to the court, in order to enable the court to make a finding that good faith attempts at job training and placement have been undertaken by the parent." The program allows you to insert a requirement for job training, although it remains to be seen what courts will actually order (given the availability of such programs), what parties will realistically agree to, and what impact this will have on improving support.

Health Insurance Provided for Children

Family Code Section 3751 provides, in part, that in any case in which an amount is set for current support, the court shall require that health insurance coverage for a supported child be maintained by either or both parents if that insurance is available at no cost or at reasonable cost to the parent. If the court determines that health insurance coverage is not available at a reasonable cost, the support order shall provide that health insurance coverage shall be obtained if it becomes available at no or reasonable cost. In those situations where the parties are not currently providing health insurance for supported children, the program now offers you the opportunity to require that health insurance be obtained if it becomes reasonably available in the future.

Intellectual Property

Commentary now reminds you of the pitfalls encountered in Roddenberry v. Roddenberry (1996) 44 Cal.App.4th 634, 51 Cal.Rptr.2d 907, of not clearly specifying the scope of intellectual property rights being divided.